Garcia v. Hynes & Howes Real Estate, Inc., 74--319

• Decision Date: 26 June 1975
• Docket Number: No. 74--319,74--319
• Citation: 331 N.E.2d 634,29 Ill.App.3d 479
• Parties: Abel GARCIA and Martha Garcia, Plaintiffs-Appellants, v. HYNES & HOWES REAL ESTATE, INC., Defendant-Appellee, and Terry L. Henson, Defendant.
• Court: United States Appellate Court of Illinois

Page 634

331 N.E.2d 634

29 Ill.App.3d 479

Abel GARCIA and Martha Garcia, Plaintiffs-Appellants, v. HYNES & HOWES REAL ESTATE, INC., Defendant-Appellee and Terry L. Henson, Defendant.

No. 74--319.

Appellate Court of Illinois, Third District.

June 26, 1975.

Robert T. Park, Rock Island, for plaintiffs-appellants.

Shifley & Hora, Davenport, Iowa, for defendant-appellee.

ALLOY, Justice:

This is an appeal from an order of the Circuit Court of Rock Island County which dismissed the complaint of plaintiffs, Abel Garcia and Martha Garcia, for failure to state a cause of action, ostensibly on the ground that no implied warranty of habitability could arise from the contract for the sale of a new home, built by the seller, which was executed in 1970.

The complaint discloses that the Garcias contracted to buy a house from the builders, defendant Hynes & Howes Real Estate, Inc., in October of 1970. On January 25, 1974, plaintiffs filed the complaint in this cause, which, as amended, charged defendants with breaching the implied warranty of habitability arising from the contract. The complaint specifically alleged lack of habitability by reason of flooding of the lower level of the house following rains.

We gave careful consideration to the precise issue which is now before us In-Hanavan v. Dye (3rd Dist., 1972), 4 Ill.App.3d 576, 281 N.E.2d 398. In that case we recognized that a contract for sale of a new home, when the vendor was also the builder, could be construed as containing an implied warranty that the house would be habitable and fit to live in. We, also, concluded that such implied warranty of habitability could serve as a basis for a breach of contract action by the purchaser.

The trial court in the cause before us apparently acknowledged that Hanavan v. Dye was in point and justified plaintiffs' cause of action, but concluded that since the contract of purchase was signed in 1970, two years before the Hanavan v. Dye decision, no such cause of action existed in 1970 and, consequently, dismissed the complaint. In Weck v. A:M Sunrise Construction Co. (1st Dist., 1962), 36 Ill.App.2d 383, 184 N.E.2d 728, the Appellate Court affirmed a verdict based upon breach of implied warranty of habitability. Thereafter, in the old Third District Appellate Court, which did not include Rock Island County within its borders, in the case of Coutrakon v. Adams (3rd Dist., 1963), 39 Ill.App.2d 290, 188 N.E.2d 780, the court reversed a verdict based, in part, upon a cause of action predicated upon implied warranties in the field of new home sales, and stated that there was no implied warranty on the part of vendor, of fitness, condition or quality.

As a result of the conflicting opinions in the Appellate Courts, the litigants in this Court directed emphasis in discussion to the question of whether or not the Hanavan v. Dye opinion controlled. As we view the record, Hanavan v. Dye did not overrule prior law other than in the sense that it concurred in the original Appellate Court decision in Weck and rejected the conclusion in Coutrakon.

As we have indicated in Hanavan v. Dye, the doctrine of implied warranty of habitability has been widely accepted. Also, the doctrine of implied warranty was given recognition in connection with the sale of goods (Ill.Rev.Stat., 1973, ch. 26, §§ 2--314, 2--315). Its application to the field of the sale of new homes by a building contractor, however, had not been uniformly accepted. The view has been taken, therefore, that the implied warranty of habitability was an unresolved question in the courts of this State, since the Supreme Court has not yet ruled upon the issue. The Supreme Court found the problem 'interesting' but refused to examine it in affirming Coutrakon on other grounds. (31 Ill.2d 189, 201 N.E.2d 100). We discussed both the Weck case and the Coutrakon case at length in our decision in Hanavan v. Dye. We there concluded that the Weck case should be followed and that the Coutrakon case should be rejected. In Hanavan v. Dye we found that an implied warranty of habitability should be recognized specifically in cases where the contractor-builder sells directly to a lay purchaser such as we have in the instant case.

We do not believe it is necessary to repeat the extensive discussion of this issue which is set forth in Hanavan v. Dye. We called attention to the cases noted in 25 A.L.R.3d 383 and the review of cases contained in several law review articles which supported a Hanavan v. Dye conclusion. It is apparent that in Hanavan v. Dye, we followed the Weck case and rejected Coutrakon, and sought to clarify the applicable law. We concluded that it had been properly applied in the Weck case in 1962.

It is apparent from the briefs that as a result of two contrary appellate court opinions, on the same level, covering different geographical regions of the State, there was some area of uncertainty as to the applicable rule. The opinions of any Appellate Court necessarily are binding on all Circuit Courts across the State, but not on the other branches of the Appellate Court. (14 I.L.P. Courts § 83). While we agree that it cannot be said conclusively with certainty that a cause of action based on an implied warranty of habitability is recognized in this State (in absence of a Supreme Court decision) we believe that the precedent of Weck, sustained in Hanavan v. Dye, sufficiently establishes that this warranty of habitability has at least been recognized since 1962 in this State. We found it to be applicable in our Third District Appellate Court opinion in 1972, which originated in Rock Island County, as does the instant case.

It is true that when a case directly overrules another older case, or some long recognized rule of law, it is generally applied on a retroactive basis. (See: 10 A.L.R.3d 1371; 14 L.Ed.2d 992, and cases cited therein). The primary exception to that rule particularly the civil cases...