Forest Preserve Dist. of Du Page County v. Brookwood Land Venture, 2-91-0745

• Decision Date: 03 June 1992
• Docket Number: No. 2-91-0745,2-91-0745
• Citation: 595 N.E.2d 136,229 Ill.App.3d 978,172 Ill.Dec. 73
• Parties: , 172 Ill.Dec. 73 The FOREST PRESERVE DISTRICT OF DU PAGE COUNTY, Plaintiff, v. BROOKWOOD LAND VENTURE, Defendant-Appellee (National Housing Partnership, Defendant and Intervenor-Appellant; Marquette Properties, Inc., Defendant).
• Court: United States Appellate Court of Illinois

Page 136

595 N.E.2d 136

229 Ill.App.3d 978, 172 Ill.Dec. 73

The FOREST PRESERVE DISTRICT OF DU PAGE COUNTY, Plaintiff, v. BROOKWOOD LAND VENTURE, Defendant-Appellee (National Housing Partnership, Defendant and Intervenor-Appellant Marquette Properties, Inc., Defendant).

No. 2-91-0745.

Appellate Court of Illinois Second District.

June 3, 1992.

Epstein, Zaideman & Esrig, P.C., Chicago, Robert J. Zaideman (argued), Christopher T. Van Wagner, Jerry A. Esrig, for National Housing Partnership.

Katten, Muchin & Zavis, Chicago, Thomas W. Fawell, Melbourne A. Noel, Helm & Day, Scott M. Day, Naperville, for Brookwood Land Venture, Marquette Properties, Inc.

James E. Ryan, Du Page County State's Atty., Wheaton, for Forest Preserve Dist.

Justice NICKELS delivered the opinion of the court:

Intervenor, National Housing Partnership (NHP), appeals the order of circuit court granting summary judgment to defendant, Brookwood Land Venture (Brookwood). NHP sought to participate in the just compensation determined by a jury as the fair-market value of certain property, which Brookwood owned and which was the subject of an underlying condemnation action. NHP's claim was based on a contract providing for such participation in the event Brookwood entered a sales or purchase agreement for the property within a given time frame. On appeal, NHP asserts that the circuit court erred in finding as a matter of law that: (1) the condemnation was not a contract for sale within the meaning of NHP's contract with Brookwood, and (2) if the condemnation was a contract for sale, such sale did not occur until after expiration of NHP's right to participate in the proceeds of the sale of the property. We affirm.

In 1984, NHP and Marquette Properties, Inc., entered a real estate sales contract with Brookwood and Capital Bank and Trust Company of Chicago, as trustee of a land trust, for the purchase of 27 acres of vacant land in Du Page County. However, Marquette Properties, Inc., is not involved in this appeal because, subsequent to the filing of the complaint in intervention, it assigned all its rights under that contract to NHP. The sales contract called for a purchase price of $1.6 million, set the latest possible closing date as November 28, 1984, and required NHP's payment of certain sums as earnest money. However, the closing was delayed by litigation concerning the only then existing access to the property filed by an adjacent homeowners' association alleging ownership of such access. NHP and Brookwood negotiated several amendments to the initial contract extending the closing date, for which NHP paid additional sums. Eventually, NHP and Brookwood entered an "Agreement Terminating Real Estate Purchase/Sale Contract" (termination agreement) on November 26, 1986. NHP's earnest money was returned, but the additional sums that had been paid to extend the purchase agreement were retained by Brookwood. The termination agreement further provided:

"(b) Seller [Brookwood] shall make a reasonable and good faith effort to sell the premises for cash to another buyer on such terms and conditions as are in the Seller's sole judgment acceptable to the Seller, provided only that Seller has no direct or indirect ownership or control of said buyer, and that the purchase/sale agreement is the result of good faith arm's length negotiations.

(c) If a contract for the sale of the Premises, as described in paragraph (b) above (the 'Subsequent Contract') is entered into prior to March 1, 1988, Purchaser [NHP] shall be entitled to participate in the 'Net Proceeds' (as hereinafter defined) resulting therefrom in accordance with the following:

(i) if the Net Proceeds are less than $1,600,000.00, Purchaser shall receive $160,000.00.

(ii) if the Net Proceeds exceed $1,600,000.00, Purchase shall receive the sum of $160,000.00 plus fifty percent (50%) of the amount by which Net Proceeds exceed $1,600,000.00, but in no event shall Purchaser receive more than $307,250.00."

After provision for a possible installment contract, the termination agreement defined "Net Proceeds" as the total cash consideration less expenses for title insurance, escrow charges, transfer taxes, real estate commissions, real estate taxes, and interest on the existing mortgage incurred between the date of the termination agreement and any subsequent contract.

Early in February 1987, the Forest Preserve District of Du Page County (District) approached Brookwood to acquire the property. After Brookwood rejected the District's offer of $1,463,400 for the property, further negotiations were considered futile and ceased and a condemnation action was filed February 24, 1987. Although NHP was initially named a defendant, it was dismissed with prejudice in January 1988 with respect to any legal title or fee interest in the property, but without prejudice as to its rights under the termination agreement. NHP filed a complaint in intervention in June 1988 seeking injunctive and declaratory relief and damages based on the termination agreement.

In April 1989 after a jury trial, just compensation for the property was set at $2,211,898, which was upheld on appeal. (Forest Preserve District v. Brookwood Land Venture (1990), 199 Ill.App.3d 973, 146 Ill.Dec. 38, 557 N.E.2d 980.) After completion of the condemnation proceeding, the circuit court allowed NHP's petition to intervene finding that its right to participate in the proceeds of a sale required the court to reach the issue now before us of whether the condemnation was a sale as that term was defined and used in the termination agreement. NHP and Brookwood filed cross-motions for summary judgment, and the circuit court granted Brookwood's motion. The circuit court found that the relevant provision of the termination agreement was only applicable to a voluntary transfer of title and that, in any event, the condemnation occurred outside the time frame allowed by the termination agreement. NHP timely appealed and now asserts that the court erred as a matter of law in finding that the termination agreement did not apply to transfer of title by condemnation filed but not concluded until after expiration of the contract.

Summary judgment is proper when the moving party is entitled to judgment as a matter of law. (Ill.Rev.Stat.1987, ch. 110, par. 2-1005(c); Hagy v. McHenry County Conservation District (1989), 190 Ill.App.3d 833, 842, 137 Ill.Dec. 453, 546 N.E.2d 77.) The construction of the terms of a contract presents only a question of law and, therefore, is appropriate for summary judgment. W.H. Lyman Construction Co. v. Village of Gurnee (1985), 131 Ill.App.3d 87, 93, 86 Ill.Dec. 276, 475 N.E.2d 273.

In construing the terms of a contract, a court looks first only to the language of the contract employed by the parties in describing their intent. (Berutti v. Dierks Foods, Inc. (1986), 145 Ill.App.3d 931, 934, 99 Ill.Dec. 775, 496 N.E.2d 350.) If such language is clear and unambiguous, it will be given its natural and ordinary meaning. (Berutti, 145 Ill.App.3d at 934, 99 Ill.Dec. 775, 496 N.E.2d 350.) Assertions of mere disagreement between the parties over the meaning of the terms of a contract based on a subsequent unexpected turn of events cannot render an otherwise unambiguous contract ambiguous. (Berutti, 145 Ill.App.3d at 934, 99 Ill.Dec. 775, 496 N.E.2d 350.) Rather, if a court can determine the meaning of a contract based on a simple knowledge of the facts on which the meaning of the language depends, no ambiguity exists. (Berutti, 145 Ill.App.3d at 934, 99 Ill.Dec. 775, 496 N.E.2d 350.) Thus, a court may not place a construction on the terms of a contract that is contrary to the plain and obvious meaning of the language. (Johnstowne Centre Partnership v. Chin (1983), 99 Ill.2d 284, 287-88, 76 Ill.Dec. 80, 458 N.E.2d 480.) The entire instrument must be considered in determining if an ambiguity exists (United States Trust Co. v. Jones (1953), 414 Ill. 265, 270-71, 111 N.E.2d 144), and the fundamental purpose of the agreement provides the context in which disputed language should be interpreted (Pieszchalski v. Oslager (1984), 128 Ill.App.3d 437, 445-47, 83 Ill.Dec. 663, 470 N.E.2d 1083).

Condemnation, or eminent domain, is the process by which a sovereign exercises the power to "take" private property for public purposes subject to the constitutional requirement that just compensation be paid to the owner. (Department of Public Works & Buildings v. Kirkendall (1953), 415 Ill. 214, 217, 112 N.E.2d 611.) No taking in the constitutional sense occurs until a condemnation petition is filed, just compensation is ascertained, and such compensation is paid. (Towne v. Town of Libertyville (1989), 190 Ill.App.3d 563, 568, 137 Ill.Dec. 865, 546 N.E.2d 810.) Generally, no taking occurs until either a purchase or sale agreement is negotiated and executed or until condemnation proceedings, including payment, are concluded. (Towne, 190 Ill.App.3d at 568, 137 Ill.Dec. 865, 546 N.E.2d 810; Griffin v. City of North Chicago (1983), 112 Ill.App.3d 901, 906, 68 Ill.Dec. 183, 445 N.E.2d 827.) As a prerequisite to condemnation jurisdiction, the governmental body seeking to exercise its eminent domain powers must attempt to negotiate an agreement to purchase the subject property. (Ill.Rev.Stat.1989, ch. 110, par. 7-102; City of Chicago v. Harrison-Halsted Building Corp. (1957), 11 Ill.2d 431, 434, 143 N.E.2d 40; Lake County Forest Preserve District v. First National Bank (1990), 200 Ill.App.3d 354, 356, 146 Ill.Dec. 758, 558 N.E.2d 721.) However, when circumstances demonstrate that agreement is unreachable, no further negotiations are necessary. (Peoples Gas Light & Coke Co. v. Buckles (1962), 24 Ill.2d 520, 527-28, 182 N.E.2d 169; Lake County Forest Preserve, 200 Ill.App.3d at 356, 146 Ill.Dec. 758, 558 N.E.2d 721.) Just compensation is "the amount of money which a purchaser, willing but not obligated to buy the property, would pay to an owner...