O'Brien v. Cacciatore, 1-90-0605

Decision Date27 March 1992
Docket NumberNo. 1-90-0605,1-90-0605
Citation227 Ill.App.3d 836,169 Ill.Dec. 506,591 N.E.2d 1384
Parties, 169 Ill.Dec. 506 Daniel P. O'BRIEN, Plaintiff-Appellee, v. Victor CACCIATORE, Defendant-Appellant. First District, Fifth Division
CourtUnited States Appellate Court of Illinois

James P. Chapman & Assoc. Ltd., Chicago (James P. Chapman and Alan Mills, of counsel), for defendant-appellant.

Martin J. Healy, Jr. (Martin J. Healy, Jr., of counsel) and Pope & John, Ltd., Chicago (William R. Quinlan, of counsel) for plaintiff-appellee.

Presiding Justice MCNULTY delivered the opinion of the court.

This is an appeal from a judgment granting specific performance of a real estate contract. Defendant asserts on appeal that: (1) the parties were engaged in a joint venture and thus owed one another a fiduciary duty; (2) the trial court improperly excluded evidence relating to plaintiff's misrepresentations; (3) plaintiff is barred from obtaining specific performance because he comes to the court with unclean hands; and (4) if the court should affirm the trial court's judgment, then defendant is entitled to the interest and taxes he paid between the contract date and the closing date. Plaintiff contends that the trial court need not even consider these arguments because defendant's appeal is moot.

Sometime in 1985, plaintiff Daniel P. O'Brien became aware of the property located at 301-313 West North Avenue, Chicago, Illinois. In December 1985, plaintiff made an offer to purchase the property for $460,000 and the owner accepted.

Before closing the transaction, plaintiff invited Edward Kelly to join him in the purchase of the property. Kelly, in turn, involved defendant Victor Cacciatore in the acquisition. They agreed to acquire the property for purposes of investment and speculation and had no set plans for development of the property.

Defendant arranged 100 percent financing from the Lake View Bank for the acquisition of the property. Plaintiff, defendant and Kelly each agreed to be responsible for one-third of the principal amount of the loan.

Defendant also represented plaintiff, Kelly and himself in the acquisition as the attorney. Title to the property was taken in a land trust at the Lakeside Bank under Trust No. 10-1123. The beneficial interest of that trust was held by 301-313 West North Avenue Corporation (301 Corp.) and defendant held 100 percent of the shares. The 301 Corp. was to act as agent for the owners of the property.

Several individuals made offers (generally in the area of $750,000) to purchase the property. One of these offers was made by Phillip Farley, a long-time friend of plaintiff. This offer was made in the name of Farley's nominee, Deluga. The offer was delivered to plaintiff and plaintiff delivered it to defendant and advised Kelly. Plaintiff indicated that the offer was acceptable to him. No contract was ever executed by and between any of the parties in ownership of this property with Phillip Farley or any representative of Phillip Farley for the sum of $750,000 or in any other amount.

Kelly decided to sell his interest in the property to plaintiff based on the figure of $750,000 which was offered by Farley. Plaintiff purchased Kelly's interest paying to him the sum of $100,000 profit and assuming his obligation for one-third of the loan obtained from the Lake View Bank.

Plaintiff then began to negotiate with defendant to obtain his one-third interest in the property. Plaintiff tendered to defendant a real estate contract dated November 19, 1987, for the purchase of defendant's interest. In response, defendant prepared a real estate contract dated December 1, 1987, as a counter-offer. Defendant testified that when he signed the contract, he thought he was signing a contract with Farley. The contract did not contain any language that the sale to O'Brien was conditioned upon a sale to Farley or anyone else.

The contract set the closing date at January 18, 1988, and plaintiff took the steps necessary to close on the property. Defendant's law office prepared all the necessary documentation for defendant to sell his one-third interest. Defendant refused to go ahead with the real estate contract with plaintiff. As a result, plaintiff instituted an action for specific performance against defendant. Plaintiff sought specific performance of the contract, possession of the management books and records, and damages for the wrongful refusal to close the transaction. Defendant asserted his affirmative defense that his refusal to close the transaction with plaintiff was justified because plaintiff breached his fiduciary duty that plaintiff owed defendant as his joint venturer in the transaction. In particular defendant charged that he agreed to sell his interest in the property to plaintiff only because of plaintiff's representation that he would immediately sell the property in its entirety to Farley after he received the interests of his co-venturers.

After a bench trial on the merits, the trial court concluded that the evidence failed to establish the existence of a joint venture amongst plaintiff, Kelly and defendant and since there was no joint venture, the parties had no fiduciary duty to each other. In addition, the court ruled that evidence relating to negotiations with Farley was inadmissible parol evidence and because the unambiguous contract contained no condition that the property was subsequently to be sold by plaintiff to Farley, the court concluded that defendant refused to go ahead with the contract simply because he had "a change of heart," feeling that the property was worth more. The trial court's November 22, 1989 order, therefore, decreed specific performance, ordering that books, records and management be turned over to plaintiff but denied plaintiff's claim for money damages.

On December 18, 1989, plaintiff filed an emergency motion with the court to enforce its November 22, 1989 order. The trial court found in plaintiff's favor and set a closing date for the property. Defendant then filed his notice of appeal on February 27, 1990.

Plaintiff filed a second motion to enforce the trial court's November 22, 1988 order. When plaintiff orally presented his motion on March 8, 1990, the following exchange occurred:

"THE COURT: Counsel, has defendant in this case asked for a stay order from me?

DEFENSE COUNSEL: No. We have not your Honor.

* * * * * *

DEFENSE COUNSEL: I didn't know if your Honor wanted--if your Honor would entertain such a motion, that would solve all our problems.

THE COURT: Why didn't somebody make it?

DEFENSE COUNSEL: Then I, with your Honor's permission, would make an oral motion to stay this.

THE COURT: I'm going to accommodate you, and I'm going to deny it. Now go upstairs and get a stay with your appeal.

* * * * * *

THE COURT: I'm telling you, your oral motion to stay is denied. You will comply with my order unless you get a stay upstairs. Prepare that order.

PLAINTIFF'S COUNSEL: Thank you your Honor.

DEFENSE COUNSEL: Your Honor, in complying with it are we not entitled to the Court's protection that by complying with your Honor's order we are not mooting our appeal rights? That's all that we are asking. We're ready to close and comply with your Honor's order.

THE COURT: Upstairs. I have ruled on this case. I have tried it, and I have nothing but motion after motion. Now, I'm staying--I'm not going to stay it. Take it upstairs. Let the Appellate Court make a ruling.

DEFENSE COUNSEL: We're not asking you to stay it. You have denied it. We want to comply. We simply want to say respectfully--I'm sure attorneys everyday disagree with your Honor's ruling--

THE COURT: I'm not going to deprive you of your right to appeal. You have that under the law. But I'm not going to give any advisory opinions in this case either. I am not going to enter a stay order. Take it upstairs."

Defendant never attempted to obtain a stay of the trial court's judgment from this court nor did he file a notice of appeal from the March 8, 1990 order, nor amend his original notice of appeal in this regard. The parties closed on the transaction in the last week of March 1990.

Before addressing the issues raised by defendant on appeal, we must first answer the motion to dismiss taken with the case. Plaintiff seeks to dismiss defendant's appeal on the ground that it is moot because defendant accepted the benefits of the trial court's judgment without attempting to seek a stay from this court to delay the transference of his property interest pending appeal.

It is well established in Illinois that the payment or satisfaction of a money judgment by a judgment debtor does not bar the prosecution of an appeal by such judgment debtor. (Pinkstaff v. Pennsylvania R.R. Co. (1964), 31 Ill.2d 518, 202 N.E.2d 512.) Plaintiff relies on County v. Malysa (1968), 39 Ill.2d 376, 235 N.E.2d 598, for the proposition that when one voluntarily pays or accepts the benefits of a judgment, his right to appeal becomes moot. However, Malysa is distinguishable in that there, the court concluded that a condemnor in an eminent domain proceeding who pays a judgment waives his right to appeal. This conclusion was based on the fact that while in an ordinary civil case a judgment debtor does not waive his right to appeal by paying the judgment because payment is considered compulsory, a judgment in an eminent domain proceeding does not impose liability upon the condemnor but merely establishes a value it must pay to acquire title. The court therefore concluded that when a condemnor pays an award it does so voluntarily and therefore waives his right to appeal. Malysa, 39 Ill.2d 376, 379, 235 N.E.2d 598, 601.

It is clear that the defendant's transfer of the property in the instant case was not voluntary. If defendant had not transferred the property, or obtained a stay, he would have been held in contempt of court. Given the fact defendant's transfer of the property was not made by way of compromise or associated with an...

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