Cnty. Line Nurseries & Landscaping, Inc. v. Glencoe Park Dist.

• Decision Date: 23 December 2015
• Docket Number: No. 1–14–3776.,1–14–3776.
• Citation: 46 N.E.3d 925
• Parties: COUNTY LINE NURSERIES AND LANDSCAPING, INC., By and Through its BANKRUPTCY TRUSTEE, Plaintiff–Appellant, v. GLENCOE PARK DISTRICT, Defendant–Appellee.
• Court: United States Appellate Court of Illinois

46 N.E.3d 925

COUNTY LINE NURSERIES AND LANDSCAPING, INC., By and Through its BANKRUPTCY TRUSTEE, Plaintiff–Appellant

v.GLENCOE PARK DISTRICT, Defendant–Appellee.

No. 1–14–3776.

Appellate Court of Illinois, First District, Third Division.

Dec. 23, 2015.

Gauthier & Gooch, Wauconda (Thomas W. Gooch III and Sabina D. Walczyk, of counsel), for appellant.

Ancel, Glink, Diamond, Bush, DiCianni & Krafthefer, P.C., Chicago (Robert K. Bush, Derke J. Price, and Gregory W. Jones, of counsel), for appellee.

OPINION

Presiding Justice MASON

delivered the judgment of the court, with opinion.

¶ 1 County Line Nurseries & Landscaping, Inc., sued the Glencoe Park District for breach of a landscaping services contract, and the Park District countersued for County Line's alleged failure to perform under the same contract. After several months of litigation, the Park District alleged that the parties orally agreed to settle and when County Line refused to proceed with the settlement, the Park District moved to enforce the oral agreement. The trial court granted the Park District's motion, finding that County Line's denial that it had agreed to settle was not credible and it was apparent that County Line's president “changed his mind after entering into the settlement agreement.” The trial court also sanctioned County Line for violating its orders to appear through substitute counsel and ordered it to pay the attorney fees incurred by the Park District as a result of that violation. County Line appeals, arguing that the trial court erred (i) in finding that County Line agreed to the settlement, and (ii) in imposing sanctions. We affirm the trial court's order enforcing the settlement agreement, but reverse the sanction award and remand for further proceedings.

¶ 2 BACKGROUND

¶ 3 County Line contracted in 2007 to perform landscaping services for the Park District. In September 2013, County Line filed a breach of contract suit against the Park District, alleging that the Park District caused it to incur over $60,000 in additional costs beyond the contract's scope. The Park District counterclaimed, seeking over $40,000 in damages for County Line's alleged failure to perform its obligations under the contract.

¶ 4 Throughout the litigation, County Line was represented by a number of different attorneys. County Line was initially represented by the law firm of Steven A. Wright, P.C. Less than six months after the lawsuit was filed, Wright withdrew and the law firm of Jonathan P. Remijas filed a substitute appearance. A short time later, Remijas also moved to withdraw. The trial court granted the motion and gave County Line until May 20, 2014, to appear through new counsel.

¶ 5 Despite this order, County Line failed to have counsel appear on its behalf for the next several court dates, occasioning multiple extensions by the trial court. Specifically, on May 29, 2014, James Kenney, an attorney with the law firm of Saunders, Condon & Kenney, attended a status hearing and addressed the court. Kenney had not filed an appearance on County Line's behalf, but informed the court that he had spoken with County Line's President, Michael Collins, and was reviewing the file. The court continued the matter to June 10 and ordered County Line to file an appearance by that date.

¶ 6 On June 10, Kenney again appeared, despite not having an appearance on file, and requested another continuance. The court ordered County Line to file an appearance by June 18, indicating the case would be dismissed for want of prosecution failing compliance with the order.

¶ 7 On June 18, Kenney still had not filed an appearance, but again attended the status hearing to request more time. Collins was also present for the hearing (but later claimed to be “surprised” that Kenney was there). The order entered that day directed County Line to file and serve an appearance by June 26, again under threat of dismissal.

¶ 8 In the courtroom after the status hearing, Kenney raised the prospect of settlement with counsel for the Park District, Gregory Jones, and Kenney and Collins later met with Jones outside the courtroom. Collins offered to settle the parties' respective claims through a one-time payment of $17,500 to County Line. Jones told Collins and Kenney that his client wished to settle the case, that Collins' demand was in line with the Park District's prior offers and that Jones believed the Park District would likely agree to settle on those terms. Jones agreed to contact Kenney by phone no later than Friday, June 20, to confirm his client's agreement and told Kenney and Collins that pending confirmation of the Park District's agreement, he considered the case settled. Collins and Jones then shook hands to confirm their agreement.

¶ 9 Following the hearing, Jones determined that the Park District would agree to the settlement and on the morning of June 19, he telephoned Kenney and informed him of that fact. Later that day, Jones e-mailed Kenney a release and asked Kenney to return the release signed by Collins by June 24 so that the case could be dismissed at the next status on June 26.

¶ 10 On the morning of June 24, Jones was contacted by another attorney, Joshua Slade, who informed Jones that Collins had inquired about representation. When Jones informed Slade of the settlement, Slade denied any knowledge of that fact.

¶ 11 Jones then called Kenney to inquire further. Kenney disclaimed any knowledge that Collins had contacted other lawyers, confirmed that he had sent Collins the release on June 21, and indicated that he had been unable to contact Collins since then, despite several attempts.

¶ 12 Finally, on June 26, attorney Zohaib Ali of M. Hedayat & Associates, P.C. appeared in court and represented that his firm had filed an appearance for County Line. Ali told the court he was unaware of any settlement and requested 30 days to review and familiarize himself with the case. The matter was continued for status on July 24, 2014.

¶ 13 The record contains an appearance signed by Ali date-stamped June 26, 2014. Contact information, presumably for the firm, including an address and telephone number, is listed on the appearance. As discussed in more detail below, County Line eventually claimed in response to the Park District's petition for attorney fees that Ali handed a copy of his appearance to Jones on June 26, but the circuit court clerk's electronic docket does not reflect the filing of the appearance on that day.¹ No notice of filing or certificate of service is contained in the record.

¶ 14 When Jones attempted to confirm that Ali's appearance had been filed by checking the electronic docket and determined that it had not been entered on the docket, he did not contact Ali to inquire further. Instead, on July 1, the Park District filed a motion to enforce the oral settlement agreement and for sanctions as a result of County Line's claimed failure to appear through counsel by June 26.

¶ 15 In its motion, supported by Jones's affidavit, the Park District recounted the events leading up to the oral settlement agreement. Jones also averred that neither he nor the Park District had been served with a copy of Ali's appearance as of July 1. The Park District requested that the settlement be enforced and, separately, that the court sanction County Line for (i) violating its repeated orders to have counsel appear on its behalf and (ii) falsely stating on June 26 that Ali had filed an appearance on its behalf. The motion did not request an award of attorney fees and costs incurred in seeking to enforce the oral settlement agreement, but it did request an award of fees and costs incurred “as a result of the misconduct.” A certificate of service reflects that a copy of the Park District's motion was served on both Ali and County Line.

¶ 16 On August 14, 2014, County Line filed a response in which it denied that it entered into any settlement. It admitted that Kenney was present at the June 18 status hearing and approached Jones to discuss the possibility of settlement but stated that Kenney had not been retained by County Line and was not authorized to make settlement offers. No affidavit from Kenney was submitted, but Collins filed an affidavit in which he admitted that he discussed the topic of settlement outside the courtroom with Jones and Kenney on June 18. Collins denied that any agreement was reached, describing the discussion as “minimal” and merely a prelude to further settlement discussions. Collins claimed he was “surprised” by Kenney's appearance at the status hearing, denied authorizing Kenney to make or accept any settlement offer on behalf of County Line, and stated that he rejected the $17,500 figure mentioned by Jones. When he left the courthouse on June 18, Collins “did not believe” the case was settled.

¶ 17 With respect to the Park District's request for sanctions as a result of County Line's failure to appear through counsel by June 26, County Line's response represented that Ali's appearance had been filed on June 26 and attached a copy of an undated facsimile cover sheet forwarding a copy of the appearance to Jones. County Line did not contend Ali handed a copy of his appearance to Jones on June 26 at the status hearing. Further, in his affidavit, Collins swore that he retained M. Hedayat & Associates to represent him on July 26, 2014, and that on August 4, 2014, “Mr. Hedayat forwarded Glencoe's Motion to Enforce Settlement Agreement and For Sanctions” to him. Collins claimed this was the first he learned of the alleged settlement agreement, although, as noted, the Park District's motion was served directly on County Line a month earlier.

¶ 18 County Line requested that the court deny enforcement of the settlement, but it did not suggest that an evidentiary hearing was necessary. Instead, based on Collins' affidavit, County Line argued that the court could find that there was no meeting of the minds and, hence, no settlement.

¶ 19 In its reply, the Park District attached a...