Tau Delta Phi, Tau Eta Chapter, Building Ass'n v. Gutierrez

232 N.E.2d 205, 89 Ill. App. 2d 25, 1967 Ill. App. LEXIS 1363
CourtAppellate Court of Illinois
DecidedNovember 10, 1967
DocketGen. 51,756
StatusPublished
Cited by9 cases

This text of 232 N.E.2d 205 (Tau Delta Phi, Tau Eta Chapter, Building Ass'n v. Gutierrez) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tau Delta Phi, Tau Eta Chapter, Building Ass'n v. Gutierrez, 232 N.E.2d 205, 89 Ill. App. 2d 25, 1967 Ill. App. LEXIS 1363 (Ill. Ct. App. 1967).

Opinion

MR. JUSTICE BURKE

delivered the opinion of the court:

This was a complaint for specific performance of an option for the sale of real estate owned by defendant. A summary decree was entered for plaintiff and defendant appeals.

On January 22, 1960, plaintiff Tau Delta Phi, as lessee, and defendant Sophie Gutierrez, as lessor, entered into a lease agreement covering the premises at 6000 North Sheridan Road in Chicago. The realty, improved with a two-story dwelling and a two-car garage, was to be used as a fraternity house for Loyola University students. The term of the lease was to run through January of 1963 at a monthly rental of $350. The lease was drawn in the presence of defendant and her attorney, the president and the secretary of plaintiff, and Mr. James Forkins, attorney for plaintiff.

In addition to the standard form of lease, a rider was attached giving plaintiff an option to purchase the premises for the sum of $51,500 upon due notice to defendant. The agreement provided that upon the exercise of the option the parties were to execute a contract for the sale at the stated price, the terms of which were to be $10,000 in cash and a purchase money mortgage in the amount of $41,500 with interest at 6 percent per year, payable monthly over a fifteen year period. The rider also provided for the payment by defendant of $350 to a real estate broker as commission for obtaining the lease and the payment of an additional commission of $1,500 if the option was exercised.

On January 22, 1963, nine days prior to the expiration of the 1960 agreement, a second lease and option was executed by the parties. It is upon this latter document that the instant suit is predicated. The second lease and option differed from the first in the following respects: the term of the lease was to run through May of 1966, the end of the year’s school term; the rent was increased from $350 to $400 per month; the purchase price under the option was reduced to $50,000 and the mortgage amount reduced to $40,000; and the real estate broker’s commission was eliminated. The option was to be exercised, if at all, at any time during the duration of the lease before January 1, 1966. Both the first and the second leases described the premises demised as “6000 North Sheridan Road”; the 1960 option reserved the right to the lessee to insert the legal description, whereas the 1963 option made no such reservation.

On December 27, 1965, the members of plaintiff voted to exercise the option and authorized attorney James Forkins, who had represented plaintiff in the negotiations for the two leases and options, to exercise the option on behalf of plaintiff. At the same time, a check was drawn to the order of Mr. Forkins, as attorney for plaintiff, covering the $10,000 cash payment called for upon the exercise of the option. Mr. Forkins then sent a letter to defendant on December 28th stating plaintiff was thereby exercising the option, but defendant failed to respond to the communication. A second letter was sent to defendant on January 10th urging defendant to cooperate, but defendant again failed to respond. This complaint for specific performance was filed on January 27,1966.

Defendant filed a motion to strike the complaint alleging that the option agreement and lease failed to definitely describe the real estate involved; that the language of the option agreement was so uncertain and ambiguous that a court of equity could not decree its specific performance; that the contract for sale which was contemplated by the option and which the complaint sought to have executed in accordance therewith contained terms which were not ascertainable until some later date; and that the alleged notice of exercise of the option lacked mutuality and was insufficient to bind plaintiff to the execution of the contract for sale. The motion to strike was dismissed and defendant was ordered to file an answer.

Defendant’s answer stated that the legal description set forth in the complaint encompassed the common addresses of 6000, 6002 and 6004 North Sheridan Road, not simply 6000 North Sheridan Road as alleged in the complaint; that the plaintiff’s attorney drew the lease and option in question contrary to the agreement entered between the parties in that the purchase price should have been $51,500; that the option agreement is ambiguous and uncertain in that the seller is required to give a mortgage to the buyer; that the monthly mortgage payment item in the document was left blank; and that the alleged notice of exercise of the option was insufficient to bind plaintiff inasmuch as it was not signed by plaintiff through its duly authorized officers. The answer further alleged that in June of 1965, the officers of plaintiff advised and informed defendant that plaintiff had no intention of exercising the option; the answer also denied that plaintiff tendered the down payment in accordance with the option requirements.

Plaintiff thereafter filed a motion for summary decree based upon the affidavit of its president, James Moreno, stating facts relating to the exercise of the option on December 28, 1965, and the tender of the $10,000 down payment as contemplated by the option. Also attached to the motion was plaintiff’s written authorization to Mr. Forkins to exercise the option to purchase.

Defendant filed a counter-affidavit stating that she was unacquainted with Mr. Moreno and that she never had dealings with him; that on or about January 22, 1963, she negotiated for the 1963 lease with John Hannan, plaintiff’s then secretary, and it was specifically agreed that the new lease would be exactly in accordance with the 1960 lease except that the duration of the lease and the monthly rental would be changed; that she relied upon the understanding thus arrived at and signed the 1963 lease without a close examination of the same; and that it was only after the present controversy arose that she learned for the first time that the option price was $50,000 instead of $51,500. The counter-affidavit further alleged that on or about June 1, 1965, she had been informed by plaintiff’s then president, Thomas Murray, that plaintiff had no intention of exercising the option and that John Hannan, by telephone, confirmed this fact and advised defendant to make plans for the premises accordingly; that on June 23, 1966, John Hannan confirmed the aforesaid telephone conversation of 1965, but that Hannan said he would not execute an affidavit to that effect. It was further alleged that the purported notice of exercise of the option was not accompanied by a written authorization of plaintiff; that on November 17, 1964, defendant assigned the lease to a savings and loan association as additional security for a mortgage note; that defendant was 73 years old, not conversant with the English language and relied upon plaintiff to draw the 1963 lease in accordance with the oral agreement reached with plaintiff’s officer; and that pursuant to plaintiff’s statement that the option would not be exercised, defendant incurred considerable expense in having plans prepared in connection with the future use of the premises and sold her home in Central America in order to raise funds necessary to carry out the plans.

Defendant caused depositions to be taken from Thomas Murray and John Hannan. It was stipulated between the parties to this action that the depositions could be used as evidence at the hearing on the motion for a summary decree.

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Bluebook (online)
232 N.E.2d 205, 89 Ill. App. 2d 25, 1967 Ill. App. LEXIS 1363, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tau-delta-phi-tau-eta-chapter-building-assn-v-gutierrez-illappct-1967.