Elliott v. LRSL Enterprises, Inc.

• Decision Date: 25 March 1992
• Docket Number: No. 2-91-0550,2-91-0550
• Citation: 589 N.E.2d 1074,226 Ill.App.3d 724,168 Ill.Dec. 674
• Court: United States Appellate Court of Illinois
• Parties: , 168 Ill.Dec. 674 Stephen J. ELLIOTT, Plaintiff-Appellant, v. LRSL ENTERPRISES, INC., Virginia Lippig and Larry Lippig d/b/a Lippig Accounting Service, Defendants-Appellees.

Page 1074

589 N.E.2d 1074

226 Ill.App.3d 724, 168 Ill.Dec. 674

Stephen J. ELLIOTT, Plaintiff-Appellant, v. LRSL ENTERPRISES, INC., Virginia Lippig and Larry Lippig d/b/a Lippig Accounting Service, Defendants-Appellees.

No. 2-91-0550.

Appellate Court of Illinois Second District.

March 25, 1992.

William E. Jegen, William E. Jegen, P.C., Glen Ellyn, for Stephen J. Elliott.

Steven C. Carbon, Kupisch, Hunt, Carbon & Kaiser, Bensenville, James McClure, Elmhurst, for LRSL Enterprises Inc., Virginia Lippig, d/b/a Lippig Accounting Services, Larry Lippig, d/b/a Lippig Accounting Services.

Justice McLAREN delivered the opinion of the court:

Stephen Elliott, plaintiff, brought a breach of contract action as landlord against his tenant, LRSL Enterprises, Inc., Virginia Lippig and Larry Lippig, d/b/a Lippig Accounting Service, defendants, seeking damages for failure to pay rent. The trial court granted defendants' motion to dismiss pursuant to section 2-619 of the Code of Civil Procedure (Ill.Rev.Stat.1989, ch. 110, par. 2-619), and plaintiff appealed. We reverse and remand.

Elliott leased certain premises to LRSL for a six-year term commencing July 1, 1987, through June 30, 1993. The lease provided, in pertinent portion, as follows:

"REMEDIES NOT EXCLUSIVE--19. The obligation of Lessee to pay the rent reserved hereby during the balance of the term hereof, or during any extension hereof, shall not be deemed to be waived, released or terminated, * * * by the service of any five-day notice, other notice to collect, demand for possession, or notice that the tenancy hereby created will be terminated on the date therein named, the institution of any action of forcible detainer or ejectment or any judgment for possession that may be rendered in such action, or any other act or acts resulting in the termination of Lessee's right to possession of the Premises. The Lessor may collect and receive any rent due from Lessee, and payment or receipt thereof shall not waive or affect any such notice, demand, suit or judgment, or in any manner whatsoever waive, affect, change, modify or alter any rights or remedies which Lessor may have by virtue hereof." (Emphasis added.)

Because defendants failed to pay rent due for December 1989 and January 1990, plaintiff instituted a suit under the forcible entry and detainer statute (Ill.Rev.Stat.1989, ch. 110, par. 9-101 et seq.) seeking possession and past-due rent. On February 23, 1990, the following order was entered:

"AGREED ORDER

This cause coming on to be heard for trial and the Court being advised that the parties have reached an agreement.

It be and is hereby ordered as follows:

(a) That the Defendants [sic ] tenancy is terminated on or about March 31, 1990 and the premises shall be vacated on or before that date.

(b) That the following sums shall be paid to the plaintiff:

(a) On Feb. 23, 1990--$2,000.00

(b) On Feb. 27, 1990--$1,176.00

(c) On March 15, 1990--$2,376.00

(c) That if Defendants fail to make any of the above payments then, upon notice of motion the Plaintiff shall be granted a judgment for all unpaid amounts and a writ of assistance for immediate possession." (Emphasis added.)

Defendants failed to make all of the payments specified in the order. Accordingly, plaintiff petitioned the court pursuant to paragraph (c) of the order and obtained both a judgment for immediate possession of the premises and a judgment for $3,552 against defendants, which represented the amounts unpaid pursuant to the terms of the order.

Thereafter, plaintiff filed a breach of contract action against the same defendants seeking damages under the lease for the period of time subsequent to the "termination of the tenancy" in March 1990. In response, defendants filed a motion to dismiss pursuant to section 2-619 of our Code of Civil Procedure (Ill.Rev.Stat.1989, ch. 110, par. 2-619). The motion asserted that the breach of contract action was barred by the entry of the agreed order in the forcible entry and detainer action and subsequent judgment for breach of the order because the issues of past and future rent due were resolved by the terms of the order. (See Ill.Rev.Stat.1989, ch. 110, par. 2-619(a)(4).) The court found the agreed order was subject to several interpretations and requested affidavits to determine the intent of the parties when the order was entered. Upon receiving the affidavits of Burton A. Brown and Teresa L. Einarson, the attorneys representing plaintiff and defendant in the forcible entry and detainer action respectively, the court granted the motion to strike and dismiss. On the motion to reconsider, the judge explained that he found language of the order ambiguous and that he interpreted the term "termination of tenancy" as a manifestation of the parties' intent to resolve all matters.

Whenever the granting of a motion to dismiss is reviewed, all well-pleaded facts alleged in the complaint are taken as true. (Wheeler v. Caterpillar Tractor Co. (1985), 108 Ill.2d 502, 505, 92 Ill.Dec. 561, 485 N.E.2d 372.) A complaint should not be dismissed under section 2-619 unless it clearly appears that no set of facts can be proved which would entitle plaintiff to recover. (People ex rel. Hartigan v. Knecht Services, Inc. (1991), 216 Ill.App.3d 843, 860, 159 Ill.Dec. 318, 575 N.E.2d 1378.) On review, the appellate court is concerned only with questions of law presented by the pleadings. Any allegations which are merely conclusions, unsupported by allegations of specific facts, are not admitted. Toys "R" Us, Inc. v. Adelman (1991), 215 Ill.App.3d 561, 564, 158 Ill.Dec. 935, 574 N.E.2d 1328.

Defendants asserted in their motion to dismiss that the breach of contract action was barred by the disposition of the forcible entry and detainer proceeding by agreed order. On appeal, plaintiff contends that the court improperly dismissed the breach of contract action under the doctrine of res judicata because the agreed order was not an adjudication of the rights of the parties and, therefore, does not constitute a final judgment on the merits. The doctrine of res judicata provides that a final judgment on the merits rendered by a court of competent jurisdiction bars any future actions between the same parties or their privies on the same cause of action. (Kinzer v. City of Chicago (1989), 128 Ill.2d 437, 446, 132 Ill.Dec. 410, 539 N.E.2d 1216.) The doctrine prohibits relitigation of not only those issues which were actually raised in the first proceeding but also any issue which might have been raised. Fried v. Polk Brothers, Inc. (1989), 190 Ill.App.3d 871, 878, 138 Ill.Dec. 105, 546 N.E.2d 1160.

A judgment is final for purposes of res judicata if it terminates litigation on the merits so that the only issue remaining is proceeding with its execution. (Catlett v. Novak (1987), 116 Ill.2d 63, 68, 106 Ill.Dec. 786, 506 N.E.2d 586.) It is true that an agreed order neither constitutes a judicial determination of the rights of the parties nor represents judgment of the court. (Ad-Ex, Inc. v. City of Chicago (1990), 207 Ill.App.3d 163, 177, 152 Ill.Dec. 136, 565 N.E.2d 669.) Instead, it is a recordation of the private agreement of the parties. (Kandalepas v. Economou (1989), 191 Ill.App.3d 51, 53, 138 Ill.Dec. 329, 547 N.E.2d 496.) However, an order entered by consent of the parties operates to the same extent for purposes of res judicata as a judgment entered after contest, because it is conclusive with respect to the matters settled by the order, judgment, or decree. (Barth v. Reagan (1986), 146 Ill.App.3d 1058, 1064, 100 Ill.Dec. 541, 497 N.E.2d 519.) Any other interpretation would effectually nullify all settlements because the same claim would be subject to the possibility of future litigation and double recovery. Therefore, we find plaintiff's contention, that res judicata does not apply because an agreed order cannot be a final judgment on the merits, erroneous as a matter of law. However, due to the nature of paragraph 19 of the lease contract, we determine that res judicata does not apply beyond the specific language of the agreed order.

An agreed order is considered a contract between the parties to the litigation. Accordingly, its construction is governed by principles of contract law. (Flora Bank & Trust v. Czyzewski (1991), 222 Ill.App.3d 382, 388, 164 Ill.Dec. 804, 583 N.E.2d 720; Haisma v. Edgar (1991), 218 Ill.App.3d 78, 87, 161 Ill.Dec. 36, 578 N.E.2d 163.) In order to determine whether the disposition of the forcible entry and detainer action by the terms of the agreed order finalized any further actions concerning the lease contract, it is necessary to interpret the language of the order.

Like any other contract, the primary consideration is to effectuate the intent of the parties. (Riney v. Weiss & Neuman Shoe Co. (1991), 217 Ill.App.3d 435, 442, 160 Ill.Dec. 375, 577 N.E.2d 505.) "In general, the intention of the parties is to be determined from the final agreement executed by them, rather than from preliminary negotiations and agreements, [citation] but previous agreements, negotiations and circumstances may be considered in determining the meaning of specific words and clauses." (Martindell v. Lake Shore National Bank (1958), 15 Ill.2d 272, 283, 154 N.E.2d 683.) Accordingly, the order must be interpreted in its entirety, considering all facts and circumstances surrounding its execution, as well as all pleadings and motions from which it emanates. Prairie Material Sales, Inc. v. White Diamond, Inc. (1987), 157 Ill.App.3d 779, 784, 110 Ill.Dec. 205, 510 N.E.2d 1236; Comet Casualty Co. v. Schneider (1981), 98 Ill.App.3d 786, 789, 54 Ill.Dec. 161, 424 N.E.2d 911.

In this case, paragraph (a) of the order states that the "tenancy is terminated on or about March 31, 1990." However, the order must be interpreted in light of paragraph 19 of the lease, which provides that the lessee's obligation to pay rent is unaffected by any acts resulting in the...