Reazuddin v. Gold Coast Exotic Imports, LLC

2022 IL App (1st) 210763-U

• Court: Appellate Court of Illinois
• Decided: March 31, 2022
• Docket: 1-21-0763
• Status: Unpublished

Opinion

2022 IL App (1st) 210763-U No. 1-21-0763 Second Division March 31, 2022

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1). ____________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ____________________________________________________________________________

) Appeal from the MICHAEL REAZUDDIN, ) Circuit Court of ) Cook County, Plaintiff-Appellant, ) Law Division ) v. ) No. 20 L 11933 ) GOLD COAST EXOTIC IMPORTS, LLC, ) ) Honorable Defendant-Appellee. ) Michael F. Otto, ) Judge, presiding. ) ____________________________________________________________________________

JUSTICE COBBS delivered the judgment of the court. Presiding Justice Fitzgerald Smith and Justice Howse concurred in the judgment. ORDER

¶1 Held: The trial court properly granted defendant’s motion to stay the plaintiff’s complaint in favor of arbitration where the relevant arbitration provisions were not procedurally unconscionable or fraudulently induced. Additionally, plaintiff forfeited any argument concerning whether he improperly entered into a contract in an agency capacity, rendering it unenforceable.

¶2 This case concerns the interpretation of an agreement to arbitrate pursuant to Section 2 of

the Illinois Uniform Arbitration Act (710 ILCS 5/2 (West 2020)). Plaintiff-appellant, Michael No. 1-21-0763

Reazuddin, filed a two-count complaint against defendant-appellee, Gold Coast Exotic Imports,

LLC, alleging common-law fraud and violations of the Illinois Consumer Fraud and Deceptive

Practices Act (815 ILCS 505/1, et seq. (West 2020)). Gold Coast moved to stay the litigation and

remand the matter to arbitration, which the circuit court granted. On appeal, Reazuddin argues that

the circuit court erred in granting the motion to stay where he entered into a contract on behalf of

another in an agency capacity, rendering the contract unenforceable, and the arbitration agreements

were procedurally unconscionable and fraudulently induced. For the following reasons, we affirm.

¶3 I. BACKGROUND

¶4 A. The Vehicle Purchase

¶5 Reazuddin is a resident of Kansas. Gold Coast is an Illinois limited liability company that

does business in Chicago under the name Perillo BMW. Gold Coast advertises itself as specializing

in the sale of high-priced vehicles.

¶6 On July 15, 2019, Reazuddin visited Gold Coast with the intention to purchase a vehicle

as an anniversary gift for his significant other, Mahreen Husain. Upon arriving at the dealership,

Mir Khan, an employee of Gold Coast, approached Reazuddin and attempted to sell him a 2012

Rolls-Royce (the vehicle). According to Reazuddin, Khan indicated that “[e]verything worked on

the vehicle” and it was reliable because it only had a mileage of 55,929 miles. Khan also indicated

that the sole previous owner had always had the vehicle serviced by Gold Coast, but, in the event

that there was an issue with the vehicle, Gold Coast “would get it fixed right away.”

¶7 Reazuddin was “reluctant” to purchase the vehicle, and initially “refused and left” the

dealership. After he left, Khan “came running outside” and offered Reazuddin a $10,000 discount

if Reazuddin purchased the vehicle that same day. Subsequently, Reazuddin agreed to purchase

the vehicle for $98,000.

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¶8 . B. The Arbitration Provisions

¶9 Gold Coast proceeded to draft a contract for the purchase of the vehicle (purchase order).

The purchase order consisted of three main preprinted pages, with additional documents as riders

to the underlying contract.

¶ 10 The first page of the purchase order indicated that Khan was the salesperson, the vehicle

being sold was a 2012 Rolls-Royce, Model Ghost, and the vehicle was in “used” condition with

55,929 miles. The purchase order also contained a blank box to be filled in by the salesperson. The

heading of the box stated: “New cars equipped per factory window sticker: Dealer installation or

promises made.” The box was filled out to read “[n]o dealer installed equipment.”

¶ 11 Also on the first page, the purchase order contained various blank sections that allowed for

the transaction to become personalized based on any representations made by a salesperson to a

potential customer. For example, page one of the purchase order contained a blank box that

indicated an area for “all oral representations or statements made by salesperson or any Dealer

personnel about the Vehicle that are important to buyer/seller in deciding on this transaction.” This

section of the purchase order was left blank. Underneath this area, the purchase order provided

that: “Nothing promised or owed to customer unless in writing.” Additionally, on the second page

of the purchase order, highlighted in red bolded capital letters, it was further noted that “[o]nce

again, if a salesperson or agent of Gold Coast Exotic Imports, LLC promised you anything—it

must be noted in this Order.”

¶ 12 The second page of the purchase order also contained a provision that expressly

incorporated other documents within:

“The Required Information, and other disclosures contained on the Retail

Installment Contract[,] are a part of this Order. By signing this order, Customer

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acknowledges having read the front or back of this document, and received copies,

where relevant of the Customer Protection Notice, immediate delivery rider,

arbitration provisions and power of attorney, and agree that they are a part of this

Order.”

(Emphasis added.) The purchase order also contained a “disclosure statement and *** additional

terms and conditions,” which were “integral part[s] of the *** Order for the Vehicle.” The

disclosure warned that “failure to read the specific conditions listed on th[e] page [was] not a

defense and [that the Customer was] legally and financially responsible for any false or inaccurate

information.”

¶ 13 Next, section 3 of the disclosure was an “arbitration of dispute” provision, which provided,

in its entirety:

“Parties agree any claim or dispute, whether in contract, tort or otherwise,

between customer and Gold Coast *** (and their respective employees, agents,

successors, or assigns) which arise out of or relate to this vehicle purchase order,

the application for, negotiation of, and financing for the vehicle, any dispute

relating to any service contract, extended warranty or other product purchased is

subject to arbitration under these provisions, or any resulting transaction or

relationship shall be submitted to the American Arbitration Association of Chicago,

Illinois or its successors conducted in accordance with the rules of the purchase

order and shall be final and binding on the parties. Judgment on the award of the

arbitrator will be enforced in any court of competent jurisdiction. The prevailing

party in the arbitration shall be entitled to receive from the other party his/its

reasonable legal fees and all other court costs.”

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(Emphasis added.)

¶ 14 Lastly, Reazuddin was also provided a separate document entitled “Out of State Arbitration

Claims” (arbitration agreement), which further expanded upon the arbitration provisions contained

within the purchase order. The arbitration agreement provided that it was:

“[M]utually agreed between the parties herein that any claim or dispute whether in

contract, tort, or otherwise, between Purchaser and seller (and their respective employees,

agents, successors, or assigns) which arise out of or relate to this vehicle purchase order or

any resulting or related transaction or relationship shall be submitted to the American

Arbitration Association of Chicago, Illinois, conducted in accordance with the rules of said

association, and according to the terms of the purchase order and shall be final and binding

on the parties. Judgment on the award of the arbitrator shall be enforced in any court of

competent jurisdiction. *** Applicable law for the State of Illinois shall govern validity,

performance, and enforcement of this agreement.”

¶ 15 Reazuddin proceeded to sign the relevant documents. Although the purchase order listed

the “Customer” as “Mahreen Husain,” Reazuddin signed his name on this document with the

phrase “as agent” in four separate locations. 1 Additionally, although “Mahreen Husain” was listed

as the “Transferee” on an “Odometer Disclosure Statement,” which listed the mileage of the

Vehicle as 55,929 miles, Reazuddin again signed this document “as agent.” Lastly, Reazuddin

signed the arbitration agreement as “agent.” No other customer signature was contained within the

purchase order or arbitration agreement.

1 The record reflects multiple spellings of Ms. Husain’s first and last names. We choose to proceed with this version as it was the spelling listed within the purchase order and other relevant documents.

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¶ 16 After signing the relevant documents, Reazuddin left the dealership again to obtain two

separate cashier’s checks from his bank in an amount totaling $98,229.81. Gold Coast cashed both

checks and then tendered possession of the vehicle to Reazuddin. Gold Coast also completed an

“Assignment of Title by Registered Owner” following the purchase of the vehicle to transfer title

to “Mahreen Husain.” The title showed that actual mileage of the vehicle at time of transfer was

57,927 miles.

¶ 17 C. The Vehicle Breaks Down

¶ 18 After taking possession of the vehicle, Reazuddin proceeded to drive the car away from the

dealership in order to return to his residence in Kansas. However, after “driving the vehicle for

less than two *** hours” and “seventy *** miles” from the dealership, the vehicle “broke down

and became entirely inoperable.” According to Reazuddin, the “entire front end of the vehicle

collapsed *** liquid and oil were pouring out of the vehicle, and all of the power functions of the

Vehicle were entirely inoperable.”

¶ 19 Subsequently, Reazuddin called Khan and indicated that the vehicle had broken down on

the highway. Reazuddin requested that Gold Coast repair the vehicle or provide a full refund of

his purchase. Khan refused to repair the vehicle, indicating that the vehicle had been sold to

Reazuddin “as is.” Reazuddin then requested that Gold Coast “void” the purchase order, which

was again rejected by Khan. Khan also refused to tow the vehicle, and Reazuddin proceeded to

call his own towing service.

¶ 20 In the weeks following the incident, Reazuddin continued to call Gold Coast and reiterated

his desire to either have the vehicle repaired or receive a refund on the purchase. Gold Coast

continued to refuse either request.

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¶ 21 On August 8, 2019, Reazuddin received the title for the vehicle. At this time, Reazuddin

purportedly learned that the vehicle had been involved in an accident prior to his purchase.

¶ 22 On October 22, 2019, Gold Coast sent a towing service to retrieve the vehicle from

Reazuddin in Kansas. The vehicle has since remained in possession of the dealership.

¶ 23 D. Trial Court Proceedings

¶ 24 On November 6, 2020, Reazuddin filed a two-count complaint against Gold Coast, alleging

both common-law fraud and a violation of the Illinois Consumer Fraud and Deceptive Business

Practices Act (815 ILCS 505/1, et seq. (West 2020)). Specifically, Reazuddin alleged that Gold

Coast “engaged in a deceptive act and/or practice” by mispresenting and selling a defective

automobile upon which Reazuddin relied to purchase the vehicle. Reazuddin attached the purchase

order, arbitration agreement, and title of the vehicle as exhibits to the complaint.

¶ 25 On March 26, 2021, Gold Coast filed a “Motion to Stay Pending Arbitration” pursuant to

section 2 of the Illinois Uniform Arbitration Act (720 ILCS 5/2(a) (West 2020)) (the Act). In the

motion, Gold Coast argued that the complaint concerned issues that Reazuddin had agreed to

arbitrate pursuant to the arbitration provisions contained within the purchase order and the

arbitration agreement.

¶ 26 Reazuddin filed a response, which included Reazuddin’s affidavit. In the affidavit,

Reazuddin averred that he had sought to purchase the vehicle as a gift for his significant other.

Reazuddin described the exchange between himself and Khan as “aggressive and pushy” and that

because he felt “incredibly rushed,” he signed all the relevant contractual paperwork, including the

arbitration agreements. Reazuddin further averred that he “noticed something [in the purchase

order] that said arbitration,” and asked Khan what that provision meant. According to Reazuddin,

Khan stated “[D]on’t worry about the arbitration provision, [Gold Coast] will take care of any and

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all issues without ever arbitrating anything. This car is perfect, but even if there is an issue, [Gold

Coast] will take care of it without needing to arbitrate.” Reazuddin averred that he responded that

he “did not want to arbitrate all claims,” to which Khan replied, “If you do not sign it, I will not

be able to take care of you if you have a problem with the vehicle.” Reazuddin’s affidavit provided

that he relied on such statements and that he “genuinely felt as though [he] had no other choice[,]”

and thus signed the relevant paperwork as his “significant other’s agent (which [he] later

discovered [was] unlawful)[.]” Finally, Reazuddin averred that he had been forced to expend

additional funds on alternate transportation, towing, legal costs, and other expenses.

¶ 27 In his response, Reazuddin argued that the arbitration clauses contained within the purchase

order and arbitration agreement were unenforceable because the arbitration provisions were

procedurally and substantively unconscionable, and that he had been “fraudulently induced to enter

into the arbitration agreement.” With regard to the argument concerning fraudulent inducement,

Reazuddin reiterated much of the same allegations contained within his complaint, namely that

Gold Coast had engaged in deceptive practices through misrepresentations upon which Reazuddin

had relied, but further stated that Khan had knowingly made false statements about the condition

of the vehicle as he knew Gold Coast “would not take care of any and all issues without arbitrating

anything.”

¶ 28 Next, Reazuddin contended that the arbitration provisions were unconscionable because

they “limit[ed] the remedies available to [him,]” and he would be “forced to accept the award of

the arbitration as well as without being able to recover punitive damages for [Gold Coast’s]

egregious misconduct.” Reazuddin asserted that the arbitration provisions were “so one-sided as

to oppress and unfairly surprise [him] and evidence[d] the clear overall imbalance in the

obligations and rights” of the parties. Last, Reazuddin argued that the arbitration agreement was

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not legally enforceable because it was “not a bargain[sic] for exchange as there was not a mutual

promise to arbitrate between the parties” and thus constituted “forced arbitration.”

¶ 29 Gold Coast filed a reply but did not submit a counter-affidavit. Gold Coast argued that the

arbitrator, not the trial court, was responsible for determining whether fraud had resulted in the

inducement of a contract. Alternatively, Gold Coast argued, even if the circuit court were to

consider Reazuddin’s fraudulent inducement arguments, under Illinois law, a party has a “general

duty to read” documents before signing them and courts could not grant relief simply because one

party failed to exercise reasonable care before signing such an agreement. Gold Coast pointed out

that Reazuddin had signed two separate arbitration agreements, and any statement made by its

employee was a statement of “non-actionable intention of future conduct” rather than a

misrepresentation. As to Reazuddin’s assertions that he had “felt rushed” during the transaction,

Gold Coast reiterated Reazuddin’s duty to read the purchase order before signing, which would

defeat any element of “reasonable reliance” to establish fraudulent inducement.

¶ 30 As to whether the arbitration provisions were procedurally unconscionable, Gold Coast

observed that Reazuddin admitted that he had read or at least had “noticed” the arbitration

provision and that Reazuddin was a “sophisticated businessman” who had purchased a $100,000

vehicle. Further, Gold Coast reasoned, just because the contract had been drafted by another party

in a superior bargaining position did not render the contract unconscionable, given that such

contracts were routinely signed in the normal course of business. As to substantive

unconscionability, Gold Coast argued that there was no evidence that Reazuddin would be limited

in seeking damages through arbitration.

¶ 31 On June 3, 2021, the circuit court heard arguments on Gold Coast’s motion. There, for the

first time before the circuit court, Reazuddin’s counsel attempted to raise the argument that

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Reazuddin had unlawfully signed the relevant documents as an “agent” of his significant other,

Hussain, and thus the arbitration provisions were null and void. Before counsel could continue

further, the circuit court inquired as to whether that argument had been raised in the briefing:

“[PLAINTIFF’S COUNSEL]: And, again, the last point that I would make

*** [is that] the defendant knew that as—indicated on the order or on the purchase

order that the *** alleged customer was listed as [Ms. Hussain]. *** With respect

to that, [Reazuddin] signed each document as the agent for *** wife [Mahreen]

Husain. And in each instance, he indicated that he was acting as a power of attorney.

And with being a power of attorney, the equal dignities rule requires that they

actually have a written agreement for the power of attorney present in order for that

contract to be enforceable.

So I just wanted to make that noted on the record as well that he made the

defendant aware, as pled in the complaint, that he was acting as an agent. He

notified them that he did not currently have the power of attorney, and Defendants

assured him it was okay. And they read them through. He signed each document as

agent. So according to that *** [t]he contract also is not enforceable.

THE COURT: I’m sorry. Before we move on from that point, can you

please remind me where any argument relating to the reported invalidity of the

contract based on the lack of a written agency agreement was made in your brief

and in opposition to the motion?

[PLAINTIFF’S COUNSEL]: Well, it was not in the specific argument. [It

is] contained in paragraph 12 of Plaintiff’s affidavit, which specifically indicates—

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THE COURT: It says, relying on Defendant’s statements and because I

genuinely felt as though I had no other choice, I was induced to sign the sales

paperwork as my significant other’s agent, parentheses, which I later discovered is

unlawful, closed parenthese[s], and ultimately paid for the vehicle.

THE COURT: Is that the paragraph in which you are referring?

[PLAINTIFF’S COUNSEL]: Yes, [Y]our Honor.

THE COURT: Okay. But if you haven’t made this argument at all in your

brief, I’m not going to entertain it today. Moreover, even if I were, this is clearly

an argument that would go to the validity of the contract as a whole, not specifically

the arbitration provision. And so it is not a matter that I can properly consider in

the context of evaluating arbitrarily according to the Coe case, correct?

[PLAINTIFF’S COUNSEL]: Understood. Yes, [Y]our Honor, correct.”

As to the remaining arguments in the briefing, the circuit court also observed that Reazuddin had

expressly stated in his sworn affidavit that he had seen the arbitration provision and had

specifically asked about it during the transaction. The court also inquired as to whether there had

been any issue of a language barrier between Reazuddin and Khan, and Reazuddin’s counsel

confirmed that there was not.

¶ 32 Subsequently, the circuit court granted Gold Coast’s motion and referred the matter to

arbitration. The court first addressed the issue of substantive unconscionability, finding no

evidence of such and that any arguments on that issue were reserved for the arbitrator pursuant to

Coe v. BDO Seidman, LLP, 2015 IL App (1st) 142215. Next, the circuit court addressed the issues

of procedural unconscionability and fraudulent inducement in tandem, acknowledging that there

was a “closer question with regard to” the two. Nevertheless, the circuit court granted the motion

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to stay, finding no evidence of either. The circuit court relied on the fact that Reazuddin’s affidavit

had indicated that he had “noticed” the word “arbitration” and had even discussed his objection to

arbitrate with Khan. This, according to the circuit court, demonstrated that Reazuddin knew to

some extent what he was being asked to sign. The circuit court also rejected Reazuddin’s

characterization of Khan’s “high-pressure sales tactics” by pointing out that Reazuddin had left

the dealership at least once, and only returned once a $10,000 discount was offered. The circuit

court found that “[i]f [Reazuddin] had not wanted to enter into the contract, he had already that

day proven himself able to resist what he himself characterizes as, quote, aggressive and pushy

attempts to sell, unquote, in paragraph 3 of his affidavit.” The circuit court further found that the

uncontested factual allegations of the case did not fit within a “narrow class of exceptions to the

duty to read” and that there was strong public policy favoring arbitration agreements.

¶ 33 This appeal followed.

¶ 34 II. ANALYSIS

¶ 35 On appeal, Reazuddin argues that the circuit court erred in granting Gold Coast’s motion

to stay for essentially two main reasons. First, Reazuddin contends that there was no valid

arbitration agreement between him and Gold Coast because he had signed all documents as an

“agent” for Husain, while never actually having authority to do so. 2 Second, Reazuddin urges this

court to find the arbitration provisions invalid because they were procedurally unconscionable and

he was fraudulently induced to sign them. We will address each argument in turn.

¶ 36 B. Standard of Review

2 Although Reazuddin characterizes this argument as two separate bases for appeal—first, that he signed the contracts as an agent, and not in his individual capacity, and second, that he lacked any authority to sign on behalf of his partner—we construe them as a single argument as both arguments concern interrelated principles of agency.

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¶ 37 Initially, the parties dispute the proper standard of review. Reazuddin contends that the

standard is de novo. Citing Guarantee Trust Life Insurance Co. v. Platinum Supplemental

Insurance, 2016 IL App (1st) 161612, and Coe v. BDO Seidman, LLP, 2015 IL App (1st) 142215,

for support, Reazuddin argues that an order granting a motion to stay or compel arbitration without

an evidentiary hearing is a “purely legal issue,” Additionally, Reazuddin contends that de novo

review is warranted because a motion to stay or compel arbitration is similar to a motion to dismiss

pursuant to section 2-619(a)(9) of the Code of Civil Procedure (Code) (735 ILCS 5/2-619(a)(9)

(West 2020)).

¶ 38 On the other hand, Gold Coast argues that the proper standard is abuse of discretion

because, contrary to Reazuddin’s assertion, the circuit court substantively considered Reazuddin’s

affidavit in support of his response to the motion. Relying on Northeast Illinois Regional

Commuter R.R. Corp. v. Chicago Union Station Co., 358 Ill. App. 3d 985 (2005), and People v.

Carter, 2017 IL App (1st) 151297, Gold Coast reasons that the consideration of the affidavit is

tantamount to an evidentiary hearing, which resulted in a factual inquiry by the circuit court and

thus warrants a more deferential standard.

¶ 39 We find the Act instructive. The Act codifies the legislature’s endorsement of arbitration

agreements. 710 ILCS 5/1 (West 2020); Liu v. Four Seasons Hotel, Ltd., 2019 IL App (1st)

182645, ¶ 24; see also Acme-Wiley Holdings v. Buck, 343 Ill. App. 3d 1098, 1103 (2003). As such,

the Act only contemplates court intervention in the event that there is evidence of fraud, corruption,

partiality, misconduct, mistake, or failure to submit the question to arbitration. City of Aurora v.

Ass’n of Professional Police Officers, 2019 IL App (2d) 180375, ¶ 52. Accordingly, Section 2 of

the Act governs proceedings to compel or stay arbitration. 710 ILCS 5/2 (West 2020); Liu, 2019

IL App (1st) 182645, ¶ 24.

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¶ 40 Pursuant to section 2(a), “[o]n application of a party showing an agreement [to arbitrate],

and the opposing party’s refusal to arbitrate, the court shall order the parties to proceed with

arbitration[.]” 710 ILCS 5/2(a) (West 2020). In the event that the opposing party “denies the

existence of the agreement to arbitrate, the court shall proceed summarily to the determination of

the issue so raised and shall order arbitration if found for the moving party, otherwise, the

application shall be denied.” Id. The “summary proceeding” as delineated in section 2(a) of the

Act has been interpreted as “a proceeding in the nature of a trial without the formalities—such as

an indictment, pleadings, and jury—and used for the speedy and peremptory disposition of the

matter.” (Internal quotation marks omitted.) Herns v. Symphony Jackson Square, LLC, 2021 IL

App (1st) 201064, ¶ 29.

¶ 41 “Normally, in an interlocutory appeal from a ruling on a motion to stay proceedings, the

circuit court’s decision is reviewed under the abuse of discretion standard.” Hayes v. Victory

Centre of Melrose Park SLF, Inc., 2017 IL App (1st) 162207, ¶ 11; see also Federal Signal Corp.

v. SLC Technologies, Inc., 318 Ill. App. 3d 1101, 1005 (2001) (citing Notaro v. Nor-Evan Corp.,

98 Ill. 2d 268, 270-71 (1983)) (an order granting or denying a motion to compel is injunctive in

nature and appealable under Illinois Supreme Court Rule 307(a)(1) (eff. Nov. 1, 2017)). The

relevant inquiry on review is “whether there was a showing sufficient to sustain the trial court’s

order.” CSC Partners Management, LLC v. ADM Investor Services, Inc., 2021 IL App (1st)

210136, ¶ 25 (citing Cohen v. Blockbuster Entertainment, Inc., 338 Ill. App. 3d 171, 177 (2003));

see, e.g., Herns, 2021 IL App (1st) 201064, ¶ 31 (whether a valid arbitration agreement existed if

the signing party lacked authority to enter into such an agreement); see also Northeast, 358 Ill.

App. at 994-95 (determining whether a trial court’s ruling on a motion to compel arbitration

implicated a “factual inquiry” that triggered an abuse of discretion standard rather than de novo).

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¶ 42 In contrast, when “the facts at issue are not in dispute, and the circuit court ma[kes] no

findings in denying [or granting] the stay,” the court’s review is de novo. Hayes, 2017 IL App (1st)

162207, ¶ 11; see also Liu, 2019 IL App (1st) 182645, ¶ 22 (when a motion to compel is ruled

upon without evidentiary hearing, de novo review is appropriate as the narrow issue before the

court concerns the interpretation of an arbitration agreement and thus presents a question of law);

see also Griffith v. Wilmette Harbor Ass’n, Inc., 378 Ill. App. 3d 173, 178-80 (2007) (courts

consider motions to compel arbitration to be similar to a section 2-619(a)(9) motion to dismiss and

thus review de novo); see also Tortoriello v. Gerald Nissan of North Aurora, Inc., 379 Ill. App. 3d

214, 219-221, 227 (2008) (although trial court heard live testimony regarding the

unconscionability of an arbitration clause, appellate court held that ultimate determination of

unconscionability was reviewable de novo).

¶ 43 Here, it is undisputed that some kind of hearing took place before the circuit court, as the

court held oral argument on the motion, but no live testimony was taken requiring factual findings.

Additionally, as noted above, courts have likened a motion to stay or compel arbitration to a section

2-619(a)(9) motion to dismiss, which is generally subject to de novo review. Griffith, 378 Ill. App.

3d at 179-80; Kedzie and 103rd Currency Exchange, Inc. v. Hodge, 156 Ill. 2d 112, 116 (1993).

Section 2-619(a)(9) permits involuntary dismissal where the claim asserted against the defendant

is barred by other affirmative matter avoiding the legal effect of or defeating the claim. 735 ILCS

5/2-619(a)(9) (West 2020); Patrick Engineering, Inc., 2012 IL 113148, ¶ 31.

¶ 44 Based on the record before us, we believe de novo review is the appropriate standard. In

finding that the arbitration agreement was not substantively unconscionable, the circuit court

examined the plain language of the arbitration agreements and found that that a lack of a jury trial

in the arbitration context did not render the arbitration provisions substantially unconscionable. As

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to the issues of procedural unconscionability and fraudulent inducement, the circuit court noted

that, while its ruling was a closer call on these two issues, it did not find any evidence of either.

Specifically, the circuit court considered Reazuddin’s affidavit attached to his response to the

motion to stay, and stated:

“There is nothing that suggests that the plaintiff was unable to read in terms

of literacy or unable to understand English. And on the contrary, the plaintiff avers

that he not only noticed the word “arbitration[,”] but specifically discussed with the

salesperson his objection to agreeing to arbitrate all claims. I do not believe that

there is a basis for finding procedural unconscionability or fraudulent inducement

where the plaintiff knew to that extent what it was that he was being asked to sign,

especially when as defense counsel *** pointed out that, in the context of deciding

whether *** there was unfair pressure or improper sales tactics, he had previously

left the dealership. He clearly knew how to resist and was able to resist any pressure

that the salesperson Khan placed on him *** before the $10,000 discount was

offered. If he had not wanted to enter into the contract, he had already that day

proven himself able to resist what he himself characterizes as, quote, aggressive

and pushy attempts to sell, unquote, in paragraph 3 of his affidavit.

*** *** ***

Given the uncontested factual allegations in this case, I do not believe that

this case fits within that narrow class of exceptions to the duty to read or the strong

public policy in favor of arbitration agreements, so I am going to grant the motion.”

(Emphasis added.) The transcript indicates that the circuit court considered both the complaint and

the “uncontested factual allegations” in Reazuddin’s affidavit to conclude that the matter should

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be referred to arbitration. Gold Coast did not present a counter-affidavit, and thus, similar to a

section 2-619(a)(9) motion to dismiss, Gold Coast accepted the factual allegations of the complaint

as true and placed the matter of arbitrability as the “affirmative matter” before the circuit court.

See Griffith, 378 Ill. App. 3d at 179-80 (a motion to compel admits the legal sufficiency of the

complaint but puts forth some affirmative matter that prevents the lawsuit from moving forward).

Thus, the circuit court never had to make any findings on any factual dispute between the parties.

Further, because an evidentiary hearing as contemplated by Section 2(a) of the Act was never held

(e.g., absence of live testimony, swearing in of witnesses), we agree with Reazuddin that on these

facts, the record before us presents a question of law, and thus the appropriate standard of review

for this appeal is de novo.

¶ 45 C. Forfeiture

¶ 46 As a preliminary matter, we must determine whether Reazuddin’s claim concerning his

ability to enter into a contract on behalf of Husain is forfeited. A majority of Reazuddin’s brief is

dedicated to advancing the argument that the arbitration provisions are null and void because he

signed each contract as “agent” of Husain rather than in his “personal capacity.” However,

Reazuddin concedes that he did not raise these arguments before the circuit court and thus

generally, this issue would not be considered. Nevertheless, Reazuddin urges this court to

disregard well-established rules of “waiver” because (1) the issue of agency was preserved when

raised to the circuit court during oral argument; and (2) alternatively, Hordowicz v. Szulc, 16 Ill.

App. 2d 317 (1958), and Illinois Supreme Court Rule 366(a)(5) (eff. Feb. 1, 1994), support

relaxation of the rule, even if the issue was not preserved. Not surprisingly, Gold Coast responds

that the issue of agency was “forfeited,” given that it was only mentioned for the first time before

the circuit court in oral argument. Further, Gold Coast asserts that the invited error doctrine

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precludes any further review because a party cannot “acquiesce to the manner in which the trial

court proceeds and then later claim error on appeal.”

¶ 47 Prior to proceeding, we deem it appropriate to clarify the difference between “waiver” and

“forfeiture.” Although the concepts of waiver and forfeiture are commonly used interchangeably

by the parties, as they have done here, as well as by courts, the two are distinct. Pinske v. Allstate

Property and Casualty Insurance Co., 2015 IL App (1st) 150537, ¶ 18. “Waiver” is the “voluntary

relinquishment of a known right,” whereas “forfeiture” refers to “the failure to make the timely

assertion of the right.” Id. (quoting People v. Blair, 215 Ill. 2d at 444 n.2 (2005)). Regardless of

the characterization, “[i]t is axiomatic that questions not raised in the trial court *** may not be

raised for the first time on appeal.” Shell Oil Co. v. Department of Revenue, 95 Ill. 2d 541, 550

(1983). “However, waiver and forfeiture rules serve as an admonition to litigants[,] rather than a

limitation upon the jurisdiction of the reviewing court” and thus we may “sometimes override

considerations of waiver and forfeiture in order to achieve a just result and maintain a sound and

uniform body of precedent.” Pinske, 2015 IL App (1st) 150537, ¶ 19 (citing Daley v. License

Appeal Comm’n, 311 Ill. App. 3d 194, 200 (1999)).

¶ 48 It is undisputed that Reazuddin’s written response to Gold Coast’s motion to stay did not

include any argument regarding the validity of the arbitration provisions based on his signing the

documents as Hussain’s “agent.” Indeed, the only mention of agency was contained within a single

line in Reazuddin’s affidavit, which stated: “Relying on [Gold Coast]’s statement, and because I

genuinely felt as though I had no other choice, I was induced to sign the sales paperwork as my

significant other’s agent (which I later discovered is unlawful), and ultimately pay for the vehicle.”

It is worth noting that within that same affidavit, Reazuddin averred that he “agreed to purchase

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the *** Vehicle as a gift for my significant other for our ten *** year anniversary.” (Emphasis

added.)

¶ 49 Additionally, as discussed above, although counsel for Reazuddin attempted to raise the

issue before the circuit court, the circuit court did not entertain it. Thus, it appears that Reazuddin

was aware that the argument concerning agency could have been raised within the response to the

motion.

¶ 50 However, we do not find that the failure to raise the agency issue in the briefs constituted

a voluntary relinquishment of the right to make such an argument. In his exchange with the court,

counsel for Reazuddin simply acknowledged that the argument was not contained in the written

response, thus implicitly agreeing that the argument could have been made. As such, the record

demonstrates a forfeiture, as opposed to waiver, of the argument that Reazuddin attempts to assert

here. See Palm v. 2800 Lake Shore Drive Condominium Ass’n, 2013 IL 110505, ¶ 26 (defendants

did not waive claim when there was no evidence of any statement of relinquishment or

abandonment of challenge to ordinance); see also People v. Tapia, 2014 IL App (2d) 111314, ¶ 37

(holding that defendant did not knowingly give up a claim for ineffective assistance of counsel

when counsel failed to correct an error in court filing, but because support for the claim existed

and defendant could have raised it in a post-judgment motion, the claim was forfeited).

¶ 51 Reazuddin correctly notes that, pursuant to Illinois Supreme Court Rule 366(a)(5), this

court may consider waived or forfeited arguments on appeal in order to produce “a just result and

for the maintenance of a strong and uniform body of precedent.” Daley, 311 Ill. App. 3d at 200.

However, we do not find that the record before us warrants relaxation of the forfeiture rule. Further,

the cases to which Reazuddin cites in support of his request for forfeiture relaxation involve

extraordinary circumstances that are not present here. See Hodorowicz, 16 Ill. App. 2d at 319-20

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(appellate court considered otherwise forfeited arguments because defendants had previously

raised them in a defective answer to complaint); see Daley, 311 Ill. App. 3d at 200-01 (reviewing

an otherwise forfeited argument following the issuance of a separate appellate court decision that

had a direct effect on the instant appeal and could not have been raised before the administrative

agency and trial court); see Jackson Jordan, Inc. v. Leydig, Voit & Mayer, 158 Ill. 2d 140, 243

(1994) (considering equitable estoppel argument in appeal of a case otherwise barred by statute of

limitations defense as a matter of fairness).

¶ 52 As the plaintiff, Reazuddin was in control of the content of his complaint, as well as the

response to the motion to stay. In the response to the motion, Reazuddin articulated, in a single

line in an affidavit, in conclusory fashion, that he believed signing as “agent” on behalf of Husain

was unlawful. Relaxation of the forfeiture rule would neither cause an unjust result nor fail to

maintain a sound and uniform body of precedent. Accordingly, we hold that any argument as to

agency was forfeited and, without expressing any opinion as to the sufficiency of the argument

itself, decline to address it here.

¶ 53 D. The Arbitration Agreements

¶ 54 Having disposed of the agency issue, we turn now to Reazuddin’s remaining arguments:

whether the arbitration provisions were procedurally unconscionable and fraudulently induced.

We begin by reemphasizing the well-established public policy that Illinois actively favors

arbitration agreements and courts retain little discretion in the review of such agreements absent

findings of fraud, corruption, partiality, misconduct, mistake, or failure to submit the question to

arbitration. Heiden, 223 Ill. App. 3d at 166-67; City of Aurora, 2019 IL App (2d) 180375, ¶ 52;

see also Coe, 2015 IL App (1st) 142215, ¶ 32 (“[C]ourts can only address the issue of whether the

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arbitration clause itself was fraudulently induced [while] [t]he question of whether fraud

permeated the entire contract, including the arbitration clause, is one for the arbitrator.”).

¶ 55 “An agreement to arbitrate presents a matter of contract.” Liu, 2019 IL App (1st) 182645,

¶ 25. The primary purpose of such an agreement is to “enable the parties to secure a speedy

determination of their differences without conforming to the strict formalities necessary in a court

of law.” Heiden, 223 Ill. App. 3d at 166-67 (citing Wilhelm v. Universal Underwriters Insurance

Co., 60 Ill. App. 3d 894, 899 (1978)). Parties to an agreement are “bound to arbitrate only those

issues they have agreed to arbitrate, as shown by the clear language of the agreement and their

intentions expressed in that language.” Liu, 2019 IL App (1st) 182645, ¶ 25. Thus, when construing

a contract, we seek to effectuate the intent of the parties by examining the contract as a whole,

with attention to the express language of the contract through its plain and ordinary meaning. Id.

¶ 56 “[T]he decision whether to compel arbitration is not discretionary.” Travis v. American

Manufacturers Mutual Insurance Co., 335 Ill. App. 3d 1171, 1175 (2002). Indeed, arbitration is

mandatory when there is a valid agreement in place and the parties’ dispute falls within the scope

of that agreement. Id. “On the other hand, where there is no valid arbitration agreement or where

the parties’ dispute does not fall within the scope of that agreement, the trial court may not compel

it.” Id. Accordingly, review of “[a] motion to compel [arbitration] raises a sole and narrow issue,”

namely, “whether the parties agreed to arbitrate the dispute.” Liu, 2019 IL App (1st) 182645, ¶ 24.

This determination aligns squarely with the long-held principle that a party cannot be forced to

arbitrate a dispute that the party has not agreed to submit to arbitration. Id. (citing Roubik v. Merrill

Lynch, Pierce, Fenner & Smith, 181 Ill. 2d 373, 382 (1998)).

¶ 57 1. Whether the Arbitration Provisions are Procedurally Unconscionable

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¶ 58 Although Reazuddin argued before the circuit court that the relevant contract provisions

were both substantively and procedurally unconscionable, Reazuddin’s argument on appeal is

limited to the issue of procedural unconscionability. 3 Accordingly, we assess whether the circuit

court erred in finding that the arbitration provisions were not procedurally unconscionable.

¶ 59 “ ‘Procedural unconscionability refers to a situation where a term is so difficult to find,

read, or understand that [a party] cannot fairly be said to have been aware he was agreeing to it

***.’ ” Kinkel v. Cingular Wireless, LLC, 223 Ill. 2d 1, 22 (2006) (quoting Razor v. Hyundai Motor

America, 222 Ill. 2d 75, 100 (2006)). Thus, courts will examine whether there was “some

impropriety during the process of forming the contract[,] depriving a party of a meaningful

choice.” Id. at 23 (citing Frank’s Maintenance & Engineering, Inc. v. C.A. Roberts, Co., 86 Ill.

App. 3d 980, 989-90 (1980)). Courts consider all of the circumstances surrounding the transaction,

such as “whether each party had a reasonable opportunity to understand the terms of the contract,

and whether important terms were hidden in a maze of fine print.” Id. Courts also examine the

“conspicuousness of the clause” and the negotiations relating to it, although both are not

conclusive. Id. Courts may also consider the parties’ experience and education, whether the

contract contained fine print, and if high-pressure tactics were used. Coe, 2015 IL App (1st)

142215, ¶ 31. Further, courts have noted that, “even if the arbitration clause is procedurally

unconscionable to a degree, *** that flaw is insufficient by itself to invalidate the clause.”

(Emphasis added.) Tortoriello, 379 Ill. App. 3d at 236.

3 Gold Coast contends that both procedural and substantive unconscionability must be found in order to invalidate an arbitration provision, but courts have previously rejected that contention. See Kinkel v. Cingular Wireless, LLC, 223 Ill. 2d 1, 21 (2006) (“A finding of unconscionability may be based on either procedural or substantive unconscionability.”); see also Frank’s Maintenance & Engineering, Inc. v. C.A. Roberts Co., 86 Ill. App. 3d 980, 989 (1980) (“Unconscionability can be either procedural or substantive or a combination of both.”).

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¶ 60 Reazuddin argues that the circuit court erred in finding no evidence of procedural

unconscionability, highlighting his averment that he was “rushed” during the transaction and did

not have a proper opportunity to review, as a non-lawyer, any of the relevant provisions of the

purchase order and arbitration agreement. As previously noted, the purchase order consisted of

three pages. On page two, an acknowledgment reads, in regular print but in capital letters, that the

customer “acknowledge[d] having read the front and back of this document, and received copies”

of other relevant documents such as the “arbitration provisions.” On page three of the purchase

order, in red and bolded text, the document provides that “the additional terms and conditions

listed on this page are an integral part of your Order for the Vehicle[,]” the customer was urged

to “[p]lease read carefully; your failure to read the specific conditions is not a defense,” and if the

customer “signed or initiated any riders, they are part of this Order.” (Emphasis added.) Finally,

section 3 of the conditions page is titled “Arbitration of disputes.” Although this portion of the

purchase order is in plain black text and neither bolded nor highlighted, Reazuddin’s affidavit

indicated that he “noticed the word arbitration,” meaning that he was able to identify it among the

text.

¶ 61 Additionally, the stand-alone arbitration agreement, which is no more than two paragraphs,

is solely dedicated to the issue of arbitration, and thus we cannot conclude that there is such a

“maze of text” or a lack of a conspicuous text that would hide the subject of arbitration from

Reazuddin. Further, most of the language of the arbitration agreement merely echoed the text

already contained in section 3 of the purchase order, with the exception of added language that

Illinois law governed any dispute between the parties. See Tortoriello, 379 Ill. App. 3d at 226

(noting that “even an arbitration clause hidden in a maze of fine print where it is unlikely to be

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noticed, much less read may be considered part of the bargain[,] if it was brought to the consumer’s

attention elsewhere in the contract.” (Internal quotations and citations omitted.).

¶ 62 Reazuddin’s sworn statements indicated that he was not only able to identify the

arbitration provisions within the relevant documents, but that he also understood what they meant.

After considering the relevant documents, on balance, we cannot say that there is any evidence

that the arbitration provisions were not “plainly visible in the agreement” and that “the meaning

of its terms were [not] clear.” Coe, 2015 IL App (1st) 142215, ¶ 31. Further, nothing within the

language of the purchase order or the arbitration agreement appears out of the ordinary. See Kinkel,

223 Ill. 2d at 26 (noting that non-negotiable arbitration clauses presented in fine print are a “fact

of modern life,” even if the average consumer might not fully understand them); see also

Tortoriello, 379 Ill. App. 3d at 234 (“Relatedly, we note that the ‘disparity of bargaining power’

identified by the trial court is not fatal to the arbitration clause” because, as noted by our supreme

court, such contracts “are typical of contracts of adhesion, which are not per se unconscionable.”).

¶ 63 Turning to the actual circumstances of the transaction, we must first note that the

transaction at issue involved the sale of a vehicle estimated to be worth at least $98,000 at a luxury

car dealership. Although Reazuddin makes much of the fact that he is a “non-lawyer” and there

was no evidence that he was a “sophisticated businessman,” it is implicit from the record that he

was not a low-income buyer and chose to drive from Kansas to Chicago to inspect a specialty

automobile. Indeed, Reazuddin avers that the vehicle was intended to be a gift for Husain,

indicating that the vehicle was not a necessity and that there was certainly more bargaining power

in the transaction than Reazuddin acknowledges today.

¶ 64 Next, Reazuddin’s affidavit described the situation as “aggressive” and “pushy” but also

reveals that he left the dealership at least once during his time there. In fact, it was only when Khan

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offered a substantial discount for a vehicle, estimated to be about $100,000 in value, that

Reazuddin returned to the dealership, indicating that he had some kind of bargaining power within

the transaction. Additionally, even though Reazuddin averred that he felt “rushed” during the

transaction, his affidavit implicitly demonstrates that there could not have been any legitimate

sense of urgency. Notably, the car dealership continued to be open after the transaction was

completed in order for Reazuddin to acquire the cashier’s checks from a bank in order to purchase

the vehicle, and he was able to call the dealership around the time the vehicle broke down on the

highway, at least two hours after he left.

¶ 65 Regarding the conversations between Khan and Reazuddin, we find nothing in the record

to suggest any language barrier between the two. Additionally, although the record reflects Khan’s

seeming inflexibility in the transaction, we are mindful that generally, “take-it-or-leave it”

approaches to sales do not necessarily rise to the level of unconscionability. See Zuniga v. Major

League Baseball, 2021 IL App (1st) 201264, ¶ 15 (arbitration provisions contained within a

preprinted, consumer contract form will not be found to be procedurally unconscionable “merely

because a business sought to impose it through a standardized, take-it-or-leave-it contract over

which the consumer had no ability to negotiate.”). Although we might disagree with Khan’s tactics

and strategies to sell the vehicle, we cannot say that Reazuddin was placed in a situation where, as

he describes, “he felt he had no choice.” See also Wigginton v. Dell, Inc., 382 Ill. App. 3d 1189,

1194 (2008) (“[U]nder Illinois law, a contract or provision may involve some degree of procedural

unconscionability, but that may not be sufficient to render it unenforceable.”). Ultimately, this was

a voluntary purchase of a high-priced good, and the circumstances of the transaction lead us to the

conclusion that there was no evidence of procedural unconscionability in the record before the

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circuit court that would prevent the matter from being referred to arbitration. As such, we affirm

the circuit court’s finding on the issue of procedural unconscionability.

¶ 66 2. Whether the Arbitration Provisions were Fraudulently Induced

¶ 67 Finally, Reazuddin contends that the circuit court erred in finding that there was no

evidence of fraudulent inducement as to the arbitration provisions. Reazuddin argues that Khan’s

“false promises” ultimately induced him to agree to the arbitration provisions, and the trial court’s

reliance on Coe, in determining that the issue of fraud was a matter best resolved by the arbitrator

rather than the trial court, was misplaced.

¶ 68 We first examine Coe. 4 There, plaintiffs retained the defendants, one of them a consulting

company, to provide advice on how to limit their tax liability resulting from the plaintiffs’ sale of

their majority ownership in a business. Coe, 2015 IL App (1st) 142215, ¶ 3. The parties’ consulting

agreement included an arbitration provision for any “dispute, controversy or claim arisi[ng] in

connection with the performance or breach of the agreement.” Id. ¶ 6. The plaintiffs also signed a

tax services agreement that contained the same arbitration clause. Id. The plaintiffs subsequently

employed the defendants’ recommended tax strategy and was audited by the IRS, which

determined that the plaintiffs had utilized an “illegal and abusive tax shelter.” Id. ¶ 8.

¶ 69 The plaintiffs filed suit against the defendants, alleging that defendants had “conspired to

design, market, sell and implement investment strategies it knew the IRS would disallow” and that

the defendants “made these representations to convince the [plaintiffs] to enter into the consulting

agreement.” Id. The plaintiffs further alleged that, by relying on the defendants’

4 While Coe examined the validity of an arbitration agreement pursuant to federal law as the relevant contract involved interstate commerce, its disposition would have been the same under both federal and state law. 2015 IL App (1st) 142215, ¶ 18.

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misrepresentations, the plaintiffs executed the agreement and then suffered damages as a result of

having settled with the IRS. Id. Further, the complaint sought a declaration that the arbitration

provisions in the consulting agreements were null and void because they had been fraudulently

induced. Id. ¶ 9. On defendants’ motion, the case was stayed pursuant to the Federal Arbitration

Act.

¶ 70 On appeal, the plaintiffs argued that the trial court erred in granting the motion to stay

because the arbitration provisions were unenforceable as they were part of the defendants’

conspiracy to commit fraud, and the trial court should have considered the arbitration provision if

it was alleged that the provision had been fraudulently induced. Id. ¶ 14. The Coe court reviewed

relevant federal arbitration law, and observed that, regardless of whether a challenge to a contract

was brought in federal or state court, any challenge to the validity of the contract as a whole, and

not specifically to the arbitration clause, must go to the arbitrator. Id. ¶ 18 (citing Buckeye Check

Cashing, Inc. v. Cardegna, 526 U.S. 440, 449 (2006)).

¶ 71 With these principles in mind, the Coe court examined the plaintiffs’ complaint, which

alleged fraud in the making of the agreement as a whole. Id. ¶ 19. The court noted that the

complaint primarily alleged fraudulent inducement as to the entire contract, which was an issue

reserved for the arbitrator, and not the trial court. Id. Although the Coe court acknowledged that

the plaintiffs’ complaint also alleged that the arbitration agreements were null and void based on

fraud or fraudulent inducement, the Coe court held that a party alleging fraud must allege that it

would have “never intended to agree to arbitrate the issues raised in the proceedings or that its

assent to the agreement to arbitrate was the product of wrongful coercion,” which it had not done

there. Id. ¶ 20 (citing Ragan v. AT&T Corp., 355 Ill. App. 3d 1143, 1158 (2005)). Accordingly,

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the Coe court affirmed the trial court’s holding that the complaint alleged fraud as to the whole

contract, which was an issue to be adjudicated by an arbitrator.

¶ 72 Here, the record shows that the circuit court expressly relied on Coe when ruling on the

issue of substantive unconscionability, an issue that is not before us today. However, Coe was also

discussed by the circuit court in an exchange with defense counsel regarding the issue of fraudulent

inducement:

“[DEFENSE COUNSEL]: First, that argument is really for the arbitrator to

decide because *** according to the Coe case *** if a claim is made relating to

fraudulent inducement as to a contract in total, which is the allegation here—I was

fraudulently induced into signing the purchase agreement and the purchase

agreement has an arbitration clause, then that claim or dispute as to the arbitrability

is for the arbitrator to decide[,] so the Court’s analysis ends there. Even if the Court

were to consider—

THE COURT: Let me just jump in for a moment on the Coe case ***. In

Coe—you correctly state what the appellate court held. But in Coe, they looked at

whether there were any allegations relating to fraud in the inducement with respect

to the arbitration clause specifically. In this case, the complaint alleges, which I

have to assume to be true for purposes of this motion, that the plaintiff *** asked

Mr. Khan specifically about the arbitration clause and that Mr. Khan said things

that the plaintiff alleges were not true about the arbitration clause itself. And

specifically those facts, it seemed to me, take this a little bit out of Coe because Coe

said that the court can decide and should decide issues relating to fraudulent

inducement to enter into the arbitration agreement, but as you point out correctly,

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not where the allegations are simply fraudulent inducement to enter into the

contract as a whole. *** But here it seems to me that the allegations relating

specifically to the arbitration provision itself are a lot more specific than the

appellate court found to exist in Coe.”

¶ 73 We first make a brief observation regarding the circuit court’s discussion of Coe. The

circuit court commented that the complaint “alleged” that Reazuddin had asked Khan specifically

about the arbitration clause and that Khan responded with representations that were not true about

the arbitration clause. However, the two-count complaint does not make any allegations

specifically relating to the arbitration provisions. Instead, the complaint here alleges fraud

generally to the contract as a whole and is focused on Khan’s alleged misrepresentations about the

quality of the vehicle itself. Thus, it appears that the circuit court conflated the assertions in

Reazuddin’s affidavit with those contained within the complaint, which were not expressly

incorporated therein. See, e.g., Collins v. Superior Air-Ground Ambulance Service, Inc., 338 Ill.

App. 3d 812, 817 (“***[w]hen an exhibit is attached to a complaint it becomes part of the

complaint” and thus any facts alleged in an affidavit, when attached to a complaint, become part

of the complaint).

¶ 74 This distinction is not without a difference. Under Coe, had Reazuddin specifically alleged

in his complaint that he never would have agreed to arbitrate had he not been fraudulently induced,

then perhaps his complaint would still be before the circuit court. Coe, 2015 IL App (1st) 142215,

¶¶ 20, 21. But Reazuddin’s complaint does not specifically allege fraud only as to the arbitration

provisions but rather, places the whole transaction and relevant contracts at issue. As such, and

notwithstanding the court’s comments, ultimately the court did not err either in its reliance or

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application of Coe in determining that Reazuddin had not sufficiently narrowed his fraudulent

inducement claim to prevent the matter from being referred to arbitration.

¶ 75 Further, even were we to consider Reazuddin’s affidavit as part of the complaint, we would

find no evidence of fraudulent inducement as to the arbitration provisions within the record.

Fraudulent inducement is a form of common-law fraud. Avon Hardware Co. v. Ace Hardware

Corp., 2013 IL App (1st) 130750, ¶ 15. A plaintiff must allege five elements to state a claim for

fraudulent inducement: “(1) a false statement of material fact; (2) by one who knows or believes

it to be false; (3) made with the intent to induce action by another in reliance on the statement; (4)

action by the other in reliance on the truthfulness of the statement; and (5) injury to the other

resulting from that reliance.” Village of Palatine v. Palatine Associates, LLC, 2012 IL App (1st)

102707, ¶ 80. As part of the claim, the plaintiff must allege that its reliance on the

misrepresentation was justifiable, which is determined by what the plaintiff knew at the time as

well any additional facts the plaintiff could have learned through the “exercise of ordinary

prudence.” Id.

¶ 76 Below and again before us now, Gold Coast argued that Reazuddin was still bound by the

“duty to read” principles of law, which generally stand for the proposition that “[a] party who

could have discovered the fraud by reading the contract, and in fact had an opportunity to do so,

cannot later *** complain that the contractual terms bind [them].” Regensburger v. China

Adoption Consultants, Ltd, 138 F. 3d 1201, 1207 (7th Cir. 1998) (applying Illinois law). We agree

with Gold Coast on this point. “One is under a duty to learn, or know, the contents of a written

contract before he [or she] signs it, and is under a duty to determine the obligations which he [or

she] undertakes by the execution of a written agreement.” Leon v. Max E. Miller & Sons, Inc., 23

Ill. App. 3d 694, 699 (1974). Thus, depending on the circumstances, any person who has an

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opportunity to read an instrument and has not availed himself of the opportunity to do so cannot

complain as to any alleged misrepresentation regarding the contents of the document. Id. at 699-

700; see also Northern Trust Co. v. VIII South Michigan Associates, 276 Ill. App. 3d at 355, 365-

66 (1995) (“A party cannot close his eyes to the contents of a document and then claim that the

other party committed fraud merely because it followed [a] contract.”)

¶ 77 As noted by Gold Coast, Reazuddin signed two separate agreements concerning arbitration,

one within the purchase order and another stand-alone agreement that was incorporated within the

purchase order. As noted prior, Reazuddin’s affidavit demonstrated that he had the ability to

identify and ask questions about the arbitration provision. Moreover, nothing in Khan’s alleged

statements evinces any fraud specifically as to the arbitration provisions. Khan’s alleged

statements do not distort the meaning of the arbitration provisions, which Reazuddin had the

opportunity to both read and reject if he so chose. As such, we hold that the circuit court properly

found no evidence of fraudulent inducement as to the arbitration provisions and affirm the circuit

court’s finding on this additional basis.

¶ 78 III. CONCLUSION

¶ 79 For the reasons stated, we affirm the judgment of the circuit court.

¶ 80 Affirmed.

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