Bricks Inc. v. C & F Developers, Inc.

• Decision Date: 22 September 2005
• Docket Number: No. 1-04-3222.,1-04-3222.
• Citation: 836 N.E.2d 743
• Parties: BRICKS, INC., Plaintiff-Appellant, v. C & F DEVELOPERS, INC., Cole Taylor Bank, Trustee under Trust # 01-977 Dated June 26, 2002, and Julian Borcyk, Defendants-Appellees, and G & B Construction, Inc., and Julian Borcyk, Defendants.
• Court: Illinois Supreme Court

836 N.E.2d 743

BRICKS, INC., Plaintiff-Appellant, v. C & F DEVELOPERS, INC., Cole Taylor Bank, Trustee under Trust # 01-977 Dated June 26, 2002, and Julian Borcyk, Defendants-Appellees, and G & B Construction, Inc., and Julian Borcyk, Defendants.

No. 1-04-3222.

Appellate Court of Illinois, First District, Fourth Division.

September 22, 2005.

COPYRIGHT MATERIAL OMITTED

Dennis G. Taheny, Ltd., South Barrington (Dennis G. Taheny, of counsel), for Appellant.

Weinberg Richmond, LLP, Chicago (Lawrence M. Karlin, of counsel).

Presiding Justice QUINN delivered the opinion of the court:

Plaintiff, Bricks, Inc. (Bricks), a supplier of building materials and supplies, brought this action against defendants G & B Construction, Inc. (G & B), C & F Developers, Inc. (C & F), Cole Taylor Bank, and Julian Borcyk to establish and enforce a lien pursuant to the Mechanics Lien Act (770 ILCS 60/1 et seq. (West 2002)), and to recover money judgments against defendants. Cole Taylor Bank, as trustee, is the owner of the premises where the construction work was done. C & F was the general contractor for the project. G & B was a masonry subcontractor that hired Bricks as its secondary subcontractor.

The trial court entered an order granting Cole Taylor Bank and C & F's motion for partial summary judgment, finding that Bricks' lien was limited to $10,000. On appeal, Bricks argues that the court erred in so limiting the amount of its lien. For the following reasons, we affirm.

BACKGROUND

G & B purchased the bricks from Bricks between October and December 2001. Bricks completed delivery of all of the bricks, valued at $64,510.22, by December 11, 2001, but defendant G & B failed to pay Bricks. In accordance with section 5 of the Mechanics Lien Act (770 ILCS 60/5 (West 2000)), C & F, as the general contractor, deposited sworn statements with Cole Taylor Bank on November 1, 2001, and December 6, 2001, detailing the total contract price and identifying various subcontractors on the construction project. These statements identified G & B as a masonry subcontractor, but did not identify Bricks as a supplier to G & B. Waivers of liens, deposited by G & B on November 8, 2001, and December 13, 2001, also failed to identify G & B's supply contract with Bricks or show that G & B was indebted to Bricks for materials supplied by Bricks. As of December 13, 2001, $260,000 of the $270,000 due on the masonry subcontract to G & B had been paid, leaving $10,000 remaining due on the contract.

Plaintiff Bricks served its notice and claim for mechanics lien on Cole Taylor Bank, C & F, and G & B on February 26, 2002, and recorded the mechanics lien with the clerk of the Cook County recorder on March 12, 2002. Thereafter, Cole Taylor Bank and C & F moved the court for partial summary judgment on the issue of liability, seeking an order that their liability to Bricks was limited to $10,000, the unpaid balance owed to G & B as of the date of their notice of Bricks' lien.

On June 11, 2004, the trial court entered an order granting the motion for partial summary judgment, finding that Bricks' lien was limited to the $10,000 that remained due to G & B as shown on the sworn statements of the general contractor, C & F. Following a bench trial with a stipulated set of facts, the trial court ruled that Bricks be paid $10,000 plus interest.¹

On October 15, 2004, prior to Bricks' filing of its notice of appeal, Cole Taylor Bank, through its insurer, paid Bricks $12,734.93, representing the principal amount of the mechanics' lien together with statutory interest through the date of payment. Bricks accepted the payment and, through its counsel, executed a release and satisfaction of judgment on October 14, 2004, which in pertinent part, provided:

"Bricks, Inc., the judgment creditor * * * having received full satisfaction, and payment, releases the judgment entered on September 20, 2004, against defendants C & F Developers, Inc. and Cole Taylor Bank * * * for $10,000.00 and interest from and after February 26, 2002."

Bricks' release was filed with the Cook County recorder of deeds on November 24, 2004. On January 13, 2005, the trial court entered an order stating that Bricks' lien was "hereby released and of no further force or effect."

ANALYSIS

Initially, we must address defendants Cole Taylor Bank and C & F's motion to dismiss Bricks' appeal as moot. Defendants argue that their payment to Bricks of the money judgment below ($12,734.93 representing the $10,000 balance plus interest), and Bricks' acceptance of that payment via the release and satisfaction of judgment signed by Bricks, rendered moot Bricks' argument on appeal that the circuit court erred in limiting its mechanics' lien to the unpaid balance owed to G & B, Bricks' immediate contractor, as of the date Bricks served notice of its claim for the lien. Thus, we must first determine whether this appeal should be dismissed as moot.

I. MOOTNESS

Defendants contend that Bricks waived its right to appeal the trial court's judgment by the terms of the judgment itself and its receipt and acceptance of full payment of the adjudicated amount of its lien. We disagree.

Section 12-183(h) of the Code of Civil Procedure provides in pertinent part: "[u]pon the filing of a release or satisfaction in full satisfaction of judgment, signed by the party in whose favor the judgment was entered or his or her attorney, the court shall vacate the judgment, and dismiss the action." 735 ILCS 5/12-183(h) (West 2002). We have found, however, that section 12-183 does not preclude the judgment creditor's right to an appeal. See Meyer v. First American Title Insurance Agency of Mohave, Inc., 285 Ill.App.3d 330, 335-37, 220 Ill.Dec. 953, 674 N.E.2d 496 (1996); Herron v. Anderson, 254 Ill.App.3d 365, 371-72, 193 Ill.Dec. 484, 626 N.E.2d 1035 (1993); In re Marriage of Pitulla, 202 Ill.App.3d 103, 109-10, 147 Ill.Dec. 479, 559 N.E.2d 819 (1990).

The purpose of section 12-183 is to serve as proof of the payment of the judgment, barring any further attempts by the judgment creditor to enforce the judgment, and to stop the accrual of postjudgment interest. Herron, 254 Ill.App.3d at 372, 193 Ill.Dec. 484, 626 N.E.2d 1035. Once a satisfaction of judgment has been filed with the trial court, the statute places a limitation on the trial court's jurisdiction to conduct further proceedings on the issue, but it does not bar an appeal. Herron, 254 Ill.App.3d at 372, 193 Ill.Dec. 484, 626 N.E.2d 1035.

As we have stated, "[i]t would be unfair for the legislature to, in the first place, compel the entry of a satisfaction and then, as a result of the compelled satisfaction, deny the right to appeal." In re Marriage of Pitulla, 202 Ill.App.3d at 110, 147 Ill.Dec. 479, 559 N.E.2d 819. To avoid this result, we have interpreted section 12-183 so that a judgment debtor cannot "compel the entry of the satisfaction [as defendants did here] and foreclose the judgment creditor's right to appeal." In re Application of the County Treasurer & ex officio County Collector of Lake County, 351 Ill.App.3d 244, 250, 286 Ill.Dec. 408, 813 N.E.2d 1101 (2004), citing Pitulla, 202 Ill.App.3d at 110, 147 Ill.Dec. 479, 559 N.E.2d 819. Thus, Bricks' signing of the release and satisfaction did not render the present appeal moot.

Moreover, Rule 305(b) offers no support to defendants' mootness argument. Rule 305(b) states in pertinent part:

"[T]he court may stay the enforcement of any judgment, or the enforcement, force and effect of interlocutory orders or any other judicial or administrative order. The stay shall be conditioned upon such terms as are just. A bond may be required in any case, and shall be required in money judgments or to protect an appellee's interest in property." 155 Ill.2d R. 305(b).²

Highlighting the last sentence of Rule 305(b), defendants' argue that "[i]f Bricks intended to preserve its interest in the real estate pending appeal, it was required to post bond."

Requiring a bond "serves as a means to give the judgment creditor security during the pendency of the appeal. It ensures that if the judgment is affirmed, the judgment creditor will be paid that which is owed." Price v. Philip Morris, Inc., 341 Ill.App.3d 941, 943, 276 Ill.Dec. 183, 793 N.E.2d 942 (2003), citing Ennor v. Galena & Southern Wisconsin R.R. Co., 104 Ill. 103, 104, 1882 WL 10384 (1882). Because Bricks is both the appellant and the judgment creditor of the money judgment entered by the trial court below, the purpose behind the requirement of a bond in cases where a money judgment was entered in favor of the judgment creditor (i.e., to ensure that the judgment creditor is paid) does not apply here. What would defendants have Bricks post as a bond? The amount Bricks sought in the circuit court below?

Normally, it is the judgment debtor, such as defendants, that must post a bond in order to protect the money judgment awarded to the judgment creditor in the proceedings below. Here, even though Bricks was awarded a money judgment, it, and not defendants, sought an appeal. Defendants have cited no case where a judgment creditor was required to post a bond under Rule 305 before filing an appeal.

Therefore, we find that Bricks was not required to post a bond under Rule 305 as a prerequisite to its filing an appeal. Based upon our interpretation of section 12-183, and the absurd result that would inure from applying defendants' reading of Rule 305(b) to Bricks, we also find that Bricks' appeal is not moot and deny defendants' motion to dismiss the appeal.

II. LIMITATION OF LIEN

We next address Bricks' argument on appeal that the trial court erred in granting defendants Cole Taylor Bank and C & F's motion for partial summary judgment limiting Bricks' recovery to $10,000 on its mechanics lien. In support of its argument, Bricks points to its compliance with section 24 of the Mechanics Lien Act (hereinafter the Act), which states, in relevant part:

"Sub-contractors, or party...