FIRST DIVISION FILED: MAY 16, 2011
NOS. 1-10-0427 and 1-10-1348, cons.
_________________________________________________________________
IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT _________________________________________________________________
PALMOLIVE TOWER CONDOMINIUMS, LLC, a ) APPEAL FROM THE Delaware limited liability company, ) CIRCUIT COURT OF ) COOK COUNTY Plaintiff-Appellee ) ) v. ) No. 09 CH 01399 ) MARY SIMON, as Trustee of the Marcy ) Simon Revocable Trust dated September ) 19, 1991, and MARC SIMON ) HONORABLE ) STUART E. PALMER Defendants-Appellants. ) JUDGE PRESIDING. _________________________________________________________________
JUSTICE HOFFMAN delivered the judgment of the court, with opinion. Presiding Justice Hall and Justice Lampkin concurred in the judgment and opinion.
OPINION
The defendants, Mary and Marc Simon, appeal from the circuit
court judgments dismissing their counterclaims against the
plaintiff, Palmolive Tower Condominiums, LLC, and granting the plaintiff judgment on the pleadings on count I of its complaint.
For the reasons that follow, we affirm the trial court’s judgment
dismissing the defendants’ counterclaims, and we dismiss the
defendants’ appeal of the trial court’s judgment on count I of the
plaintiff’s complaint.
In its complaint, the plaintiff alleged that it and the
defendants entered into a condominium purchase agreement in July
2003, before the plaintiff had finished construction on the site. NOS. 1-10-0427 and 1-10-1348, cons. That agreement provided as follows:
"4(c)(i) If Seller fails to substantially complete the
Unit on or before December 31, 2005 ***, Purchaser, as its
sole remedy for such failure, shall have the right to
terminate this Agreement ***. In the event Purchaser
exercises its Right to Terminate hereunder, Purchaser shall be
only entitled to a refund of the Earnest Money and all
interest earned thereon and this Agreement shall terminate. ***
(ii) Notwithstanding the foregoing, if the Closing does
not occur by August 31, 2005, Seller shall, as compensation
for the delay, at Purchaser’s option, (A) pay to Purchaser
[$7,500] per month ***, or (B) provide to Purchaser [an
apartment and parking]. If Purchaser is entitled to receive
(A) or (B) under this paragraph ***, such shall be provided by
Seller from July 1, 2005[,] through and including the earlier
of *** the Closing Date *** or *** the effective date of the
Purchaser’s termination of [the Agreement]."
According to the plaintiff’s complaint, on January 17, 2006,
it and the defendants entered into a closing agreement, which
provided as follows, in relevant part:
"Whereas, Seller has not yet completed construction of
the *** Building ***; and
Whereas, *** purchaser is not obligated to close the
purchase of the Premises until such [construction] has been
2 NOS. 1-10-0427 and 1-10-1348, cons. completed; and
Whereas, the parties have agreed to close the purchase
and sale of the Premises in accordance with and in material
reliance upon the provisions of this Closing Agreement.
Now, therefore, the parties agree as follows:
* * *
2. At closing, [part of] the sales proceeds shall [be
deposited into escrow]. Seller represents and warrants to Purchaser that Seller has completed construction *** except
for construction to be performed on [two floors of the
building on which the plaintiffs’ condominium is not located]
***. The escrowed funds shall be held in escrow until [the
construction is completed, in which case the seller will
receive the funds, or until three years pass, in which case
the purchaser will receive the funds]. ***
3. Seller represents and warrants to Purchaser that
Seller has heretofore closed the sale of three *** condominium
units in the Building, has signed contracts with no less than
10% earnest money deposited for the sale of [83] condominium
units and there are no more than [15] condominium units
remaining unsold.
4. Seller represents and warrants to Purchaser that it is
Seller’s good faith belief that construction of no less than
25% of the condominium units in the Building will be completed
by March 1, 2006, 50% by June 1, 2006, 75% by September 1,
3 NOS. 1-10-0427 and 1-10-1348, cons. 2006[,] and 100% by December 1, 2006.
5. At closing, Purchaser will receive a credit of
[$25,000] ***."
The plaintiff alleged, and the defendants in their answer
admitted, that the defendants took possession of their condominium
on the date of the closing agreement and began residing there just
over one week later. However, according to the complaint, even
after the plaintiff obtained the required construction approval for the project, the defendants declined to release the escrow money to
the plaintiff. The plaintiff’s complaint contained three counts,
seeking a declaration of the plaintiff’s entitlement to the
escrowed funds, damages for breach of the parties’ agreements, and
specific performance of the parties’ agreements.
The defendants thereafter filed counterclaims against
plaintiff for breach of contract, negligence, and fraud. The
counter-complaint contained the following allegations:
"12. When informed by [the plaintiff] that the Unit was
habitable, the [defendants] agreed to close on January 17,
2006.
16. By closing on January 17, 2006, the [defendants] gave
up their rights to receive a payment of $7,500 per month ***.
20. On information and belief, the representation and
warranty [the plaintiff set out in the closing agreement,
4 NOS. 1-10-0427 and 1-10-1348, cons. regarding the construction and sales of other units] was
untrue and therefore breached."
The counter-claim then detailed the defendants’ reasons for
believing that sales and construction progress were not as the
plaintiff had warranted and setting forth the plaintiff’s
involvement with the sales and construction processes. According
to the counter-claim, construction on the project was not finally
finished until October 2008. In their count for breach of contract, the defendants alleged
that the plaintiff’s failure to honor the warranties made in the
closing agreement "[s]ubjected the [defendants] to the risk that
the project would fail," "[c]aused the [defendants] to be
inconvenienced by [the plaintiff’s] construction work including
lack of access to all elevators, dirt, dust and debris in their
Unit, on their deck and their cars, the cost of which was not less
than $10,000.00," caused the defendants to "give up what was
essentially a free option on [the property]" due to their right to
terminate the agreement, caused the defendants to "[give] up the
opportunity to earn interest on [the cost of the condominium] ***
and [begin] paying taxes and assessments," caused the defendants to
begin using a property tax freeze earlier than if they had waited
to close, and caused them to forgo their right to a monthly $7,500
credit.
In their fraud count, the defendants alleged that the
plaintiff knew the representations in the closing agreement to be
5 NOS. 1-10-0427 and 1-10-1348, cons. false but made them anyway in an attempt to induce the defendants’
agreement to close. The fraud count alleged that the defendants
were damaged in the same ways described in the breach of contract
count.
The plaintiffs filed a motion to dismiss the defendants’
counterclaims as well as a motion for judgment on the pleadings.
In January 2010, the circuit court granted the plaintiff’s motion
to dismiss the counterclaims in an order that also stated, "This is a final and appealable order there being no just reason to delay
enforcement or appeal." The defendants thereafter filed a notice
of appeal relating to that order, and the matter was docketed in
this court as case number 1-10-0427. In April 2010, the circuit
court granted the plaintiff’s motion for judgment on the pleadings
in part, by granting judgment on the first count of the plaintiff’s
multi-count complaint. The order stated, "This order is final and
appealable." The defendants filed a second notice of appeal
challenging the April 2010 order. We docketed the matter as case
number 1-10-1348, and we later consolidated it for decision with
the defendants’ prior appeal.
We begin by addressing the defendants’ appeal in case number
1-10-1348. Although the parties agree that we have jurisdiction
over that appeal, we have an independent duty to consider the issue
and dismiss the appeal where our jurisdiction is lacking. Mund v.
Brown, 393 Ill. App. 3d 994, 996, 919 N.E.2d 1225 (2009). We
conclude that we do not have jurisdiction over this appeal.
6 NOS. 1-10-0427 and 1-10-1348, cons. "If multiple parties or multiple claims for relief are
involved in an action, an appeal may be taken from a final judgment
as to one or more but fewer than all of the parties or claims only
if the trial court has made an express written finding that there
is no just reason for delaying either enforcement or appeal or
both." Ill. Sup. Ct. R. 304(a) (eff. Feb. 26, 2010). Here, the
defendants seek to appeal an order that resolved only one count of
the plaintiff’s multi-count complaint and therefore unquestionably resolved fewer than all of the claims between the parties.
Accordingly, under Rule 304(a) the order was not appealable unless
it was accompanied by the circuit court’s express written finding
that there was "no just reason for delaying either enforcement or
appeal or both." For their stance that the circuit court’s April
10 order is appealable, the parties cite the court’s statement that
the order was "final and appealable." That order, however,
contains no reference either to Rule 304(a), to the justness of
delaying enforcement or appealability, or to the propriety of
immediate appeal.
Our supreme court does not require that a circuit court parrot
Rule 304(a) exactly in order to invoke it. Indeed, in In re
Application of Du Page County Collector, 152 Ill. 2d 545, 605
N.E.2d 567 (1992), the court explained that an order accompanied by
language referencing only "appealability" or "enforceability" may
be reviewed under Rule 304(a) depending on the circumstances.
According to the supreme court in Du Page County Collector, "where
7 NOS. 1-10-0427 and 1-10-1348, cons. the written finding makes [a judgment that confers a legal right
capable of enforcement] immediately enforceable and it is clear
from the record that Rule 304(a) is intended to be invoked,
reference to appealability is unnecessary as surplusage." Du Page
County Collector, 152 Ill. 2d at 549. On the other hand,
judgments, such as dismissals of claims, that leave nothing to be
enforced may be appealed pursuant to a finding "that there is no
just reason to delay appeal." Du Page County Collector, 152 Ill. 2d at 549. (Rule 304(a) was later amended to reflect the holding
in Du Page County Collector by stating more clearly that a circuit
court must find that there is no just reason for delaying "either"
enforcement or appeal "or both." Ill. S. Ct. R. 304(a), Committee
Comments (adopted Dec. 17, 1993).)
Although it created some leeway for the language that may be
used to invoke Rule 304(a), the supreme court in Du Page County
Collector stopped short of indicating that Rule 304(a) does not
require some reference to immediate enforcement or appealability or
the justness of delaying enforcement or appealability. In fact,
the supreme court was careful not to excise those qualifications
from its articulation of Rule 304(a)’s requirements. See Du Page
County Collector, 152 Ill. 2d at 549 ("It would be proper in such
cases to find only that there is no reason to delay appeal from
such a judgment"); 152 Ill. 2d at 550 ("where it is clear *** that
review is sought *** pursuant to Rule 304(a) and the judgment
confers a legal right capable of enforcement, the required written
8 NOS. 1-10-0427 and 1-10-1348, cons. finding is sufficient *** if it refers to either the judgment’s
immediate enforceability or its immediate appealability" (emphases
added)); see also Burnham Management Co. v. Davis, 302 Ill. App. 3d
263, 269, 704 N.E.2d 974 (1998) (citing Du Page County Collector
for the proposition that a written finding triggers Rule 304(a)
"only if it refers either to the judgment’s immediate
enforceability or its immediate appealability").
The supreme court had good reason for retaining the requirement that a court refer to immediate enforceability or
appealability or to the justness of delaying either. The rationale
underlying Rule 304(a) is that it allows appeals to be taken before
the final disposition of a case where the circuit court considers
an immediate appeal to be appropriate. Matson v. Department of
Human Rights, 322 Ill. App. 3d 932, 937, 750 N.E.2d 1273 (2001).
Thus, Rule 304(a) allows a circuit court to limit piecemeal appeals
yet still allow early appeals when, in its discretion, doing so
"would have the effect of expediting the resolution of the
controversy, would be fair to the parties, and would conserve
judicial resources." Matson, 322 Ill. App. 3d at 938. A circuit
court’s declaration that an order is "final and appealable,"
without reference to the justness of delay, or even reference to
immediate appealability, evinces no application of the discretion
Rule 304(a) contemplates. See Matson, 322 Ill. App. 3d at 939.
Instead, absent some other indication from the record that the
court intended to invoke Rule 304(a) (see Coryell, 245 Ill. App. 3d
9 NOS. 1-10-0427 and 1-10-1348, cons. at 5 (noting that court was not asked to make a Rule 304(a) finding
and that Rule 304(a) was not referenced in the court’s order)), a
circuit court’s declaration that an order is "final and appealable"
amounts to nothing more than a non-binding interpretation. See
Com-Co Ins. Co. v. Service Industry Agency, Inc., 321 Ill. App. 3d
816, 819, 748 N.E.2d 298 (2001) (citing a supreme court decision
discussing only finality for the proposition that the "trial
court’s declaration of finality and appealability is not enough, standing alone, to make an order appealable").
For these reasons, a circuit court order accompanied by
language indicating that it is "final and appealable," but not
referencing immediate appeal, the justness of delay, or Rule
304(a), does not trigger the rule. See Coryell v. Village of La
Grange, 245 Ill. App. 3d 1, 5, 614 N.E.2d 148 (1993) (discussing Du
Page County Collector and holding that circuit court’s finding that
an order was "final and appealable," without reference to justness
of delay, did not trigger Rule 304(a)). See also Hopkins v.
Illinois Masonic Medical Center, 211 Ill. App. 3d 652, 654, 570
N.E.2d 575 (1991) (prior to the supreme court’s decision in Du Page
County Collector, holding that circuit court finding that order was
"Final and Appealable" was insufficient); Lurz v. Panek, 166 Ill.
App. 3d 179, 181-92, 519 N.E.2d 1110 (1988) (same); Hamer v. Lentz,
155 Ill. App. 3d 692, 695, 508 N.E.2d 324 (1987) (same). Because
the April 2010 order did none of those things, it was not
appealable.
10 NOS. 1-10-0427 and 1-10-1348, cons. In so holding, we recognize our departure from Com-Co
Insurance Agency, Inc. In that case, this court, confronted with
what appears to have been the same circuit court language we
encounter here, concluded that a circuit court declaration that an
order was "final and appealable" sufficed to invoke Rule 304(a).
See Com-Co Insurance Agency, Inc., 321 Ill. App. 3d at 819
(summarizing, but not quoting, relevant language). The court
reached this conclusion based on the following reasoning: "The trial court’s declaration of finality and
appealability is not enough, standing alone, to make an order
appealable. [Citation.] If the order finally disposed of the
rights of the parties on some definite and separate branch of
the controversy, then the court’s statement of enforceability
or appealability makes the order immediately appealable under
Supreme Court Rule 304(a). [Citations.]
The court’s language need not match the wording in Rule
304(a) precisely. ‘[W]here appeal is sought pursuant to Rule
304(a) from a judgment which defeats a claim or is in the
nature of a dismissal, the written finding is sufficient only
if it refers to appealability.’ [Citation to Du Page County
Collector].
Here, the court appropriately referred to appealability.
We agree with the trial court’s implicit holding that the
claim *** is sufficiently separable *** for immediate appeal."
Com-Co Insurance Agency, Inc., 321 Ill. App. 3d at 819.
11 NOS. 1-10-0427 and 1-10-1348, cons. We find this reasoning to be unpersuasive, for three reasons.
First, the reasoning, which begins with a statement that a circuit
court declaration of appealability is not controlling, but ends by
saying that a reference to appealability is sufficient, is
internally contradictory. Second, the reasoning oversimplifies,
and thus misstates, the holding from Du Page County Collector,
which, as explained above, held that a circuit court’s reference to
appealability, without a reference to enforceability, could invoke Rule 304(a), but did not hold that the reference to appealability
could invoke Rule 304(a) without any reference to immediacy or the
justness of delaying the appeal. Third, the reasoning relies on
what it terms a circuit court’s "implicit holding" that Rule 304(a)
applied; the language of Rule 304(a), however, calls emphatically
for "an express" finding. Ill. Sup. Ct. R. 304(a) (eff. Feb. 26,
2010). For these reasons, we depart from Com-Co Insurance Agency,
Inc. and instead hold to our own interpretation of Rule 304(a) as
requiring something more than a circuit court declaration that an
order is "final and appealable." Because the April 2010 order the
defendants seek to appeal in case number 1-10-1348 stated only that
it was "final and appealable," it was not appealable under Rule
304(a). As a result, we have no jurisdiction to review that order,
and we must dismiss the defendants’ appeal in case number 1-10-
1348.
Unlike the April 2010 order in case number 1-10-1348, the
January 2010 order the defendants seek to appeal in case number 1-
12 NOS. 1-10-0427 and 1-10-1348, cons. 10-0427, contains the language required by Rule 304(a), and
therefore constitutes an appealable order that we have jurisdiction
to review. The defendants ask that we reverse that order, which
granted the plaintiff’s motion to dismiss on the grounds that the
defendants counterclaims failed to state causes of action and
failed to allege damages.
Although it was not so labeled, the plaintiff’s motion to
dismiss presumably was brought pursuant to section 2-615 of the Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2008)). A
motion to dismiss pursuant to section 2-615 of the Code attacks the
legal sufficiency of a complaint by alleging defects appearing on
the face of the complaint. Irizarry v. Illinois Central R.R. Co.,
377 Ill. App. 3d 486, 488, 879 N.E.2d 1007 (2007). Such a motion
should be granted if the complaint does not allege sufficient facts
to state a cause of action. Irizarry, 377 Ill. App. 3d at 488. A
challenge to the propriety of a decision to grant a section 2-615
motion to dismiss presents a legal question that we review de novo.
YPI 180 N. LaSalle Owner, LLC v. 180 N. LaSalle II, LLC, 403 Ill.
App. 3d 1, 8, 933 N.E.2d 860 (2010).
Among the circuit court’s reasons for dismissing the
defendants’ counterclaims was its conclusion that the defendants
failed to plead damages. A legally sufficient claim for breach of
contract or fraud must allege the existence of damages. Doe v.
Northwestern University, 289 Ill. App. 3d 39, 45, 682 N.E.2d 145
(1997). The purpose of damages for breach of contract is to put
13 NOS. 1-10-0427 and 1-10-1348, cons. the injured party in the position it would have been in had the
contract been fully performed. Anderson v. Long Grove Country Club
Estates, Inc., 111 Ill. App. 2d 127, 141, 249 N.E.2d 343 (1969).
In a cause of action for fraud, a defrauded party is entitled to
those damages that enable it to be "placed in the same financial
position as [it] would have been had the misrepresentation in fact
been true." Brown v. Broadway Perryville Lumber Co., 156 Ill. App.
3d 16, 25, 508 N.E.2d 1170 (1987). To argue that the circuit court erred in concluding that they
did not allege damages sufficiently, the defendants point to
several rights--their right to a monthly $7,500 payment until
closing, their option to terminate the purchase agreement upon a
late closing, their option to allow the closing to be further
delayed, and their ability to accrue interest on their purchase
money--that they forwent by entering into the closing agreement.
The measure of the defendants’ damages, however, is not the value
of the items they bargained away as part of the closing agreement,
but the difference in their current position and the position they
would have attained if the plaintiff had fully performed its duties
under the contract (or if its representations had been true).
Accordingly, we agree with the circuit court that none of the above
points constitute proper damages allegations.
The defendants’ remaining damages argument asserts that the
alleged breaches or misrepresentations caused a disparity between
their expected value for the condominium and the actual value of
14 NOS. 1-10-0427 and 1-10-1348, cons. the condominium, due to the "risks inherent in a building that has
not yet achieved a minimum threshold of sales" or that is still
undergoing construction. However, to the extent those factors
detracted from the value of the defendants’ purchase, they were
only transitory and, even according to the defendants’
counterclaim, were resolved with no intervention from the
defendants. Cf. Hudlin v. City of East St. Louis, 227 Ill. App. 3d
817, 834, 591 N.E.2d 541 (1992) (if an injury to real estate is not permanent, then the measure of damages is the cost of restoration).
The defendants make no allegation that the plaintiff did not
eventually complete the requisite construction and sales so that
those problems no longer affect the defendants, nor do they allege
that they were in any way harmed by any temporary diminution in
value, for example by failed efforts to sell their condominium or
obtain loans based on its value. For these reasons, we reject the
defendants’ final argument that they properly alleged damages from
the plaintiff’s alleged misconduct. As a result, we agree with the
circuit court that the defendants failed to allege damages and that
their counterclaims should have been dismissed.
For the foregoing reasons, we affirm the judgment of the
circuit court in case number 1-10-0427, and we dismiss the
defendants’ appeal in case number 1-10-1348.
No. 1-10-0427, Affirmed.
No. 1-10-1348, Dismissed.
15 NOS. 1-10-0427 and 1-10-1348, cons.
REPORTER OF DECISIONS - ILLINOIS APPELLATE COURT (Front Sheet to be attached to Each Opinion)
PALMOLIVE TOWER CONDOMINIUMS, LLC, A, Please use the Delaware limited liability company, following form: Plaintiff-Appellee,
Complete v. TITLE MARY SIMON, as Trustee of the Marcy Simon Revocable Trust dated September 19, 1991, and MARC SIMON,
Defendants-Appellants.
Docket No. No. 1-10-0427 and 1-10-1348, cons. Court Appellate Court of Illinois First District, First Division Opinion Filed May 16 , 2011 (Give month, day and year)
JUSTICE THOMAS E. HOFFMAN, delivered the opinion of the Court.
HALL, P.J. and LAMPKIN, J., , concur[s]. JUSTICES , dissent.
Appeal from the Lower Court and trial Judge(s) in form indicated in margin: Circuit Court of Cook County; the Appeal from the Circuit Court of Cook County. Judge Presiding. The Hon.(s) STUART E. PALMER , Judge(s) Presiding.
For Appellants, Indicate if attorney represents APPELLANTS or APPELLEES and include John Doe, of attorneys of counsel. Indicate the word NONE if not represented. Chicago. FOR APPELLANT: Sperling & Slater, P.C. of Chicago. Steven C. Florsheim & Diana For Appellees, G. Rollman, of counsel. Smith & Smith, Robert A. Weisman, LTD., of Chicago. Robert A. Weisman of counsel. of Chicago.
Also add attorneys for third party appellants and/or FOR APPELLEES:. K&L Gates LLP, of Chicago. Abram I. Moore & Daniel G. Rosenberg, appellees. of counsel.
Cassiday Schade, LLP, of Chicago. Julie A Teuseher &
16 NOS. 1-10-0427 and 1-10-1348, cons. Richard A. Barrett, Jr., of counsel. .
(USE REVERSE SIDE IF NEEDED)