Hubble v. O'Connor

• Decision Date: 01 August 1997
• Docket Number: No. 1-96-1095,1-96-1095
• Citation: 225 Ill.Dec. 825,684 N.E.2d 816,291 Ill.App.3d 974
• Parties: , 225 Ill.Dec. 825 Ron HUBBLE and Barbarann Hubble, Plaintiffs-Appellants, v. Paul O'CONNOR and Lynda Simon, Defendants-Appellees.
• Court: United States Appellate Court of Illinois

Page 816

684 N.E.2d 816

291 Ill.App.3d 974, 225 Ill.Dec. 825

Ron HUBBLE and Barbarann Hubble, Plaintiffs-Appellants, v. Paul O'CONNOR and Lynda Simon, Defendants-Appellees.

No. 1-96-1095.

Appellate Court of Illinois First District, Sixth Division.

Aug. 1, 1997.

Opinion Supplementing Decision on

Denial of Rehearing Sept. 19, 1997.

Roxanne Spinasanta, Riverside, for Plaintiffs-Appellants.

Steven C. Daily and M. Scott Gordon of Schwartz, Cooper, Greenberger & Krauss, Chartered, Chicago, for Defendants-Appellees.

Justice ZWICK delivered the opinion of the court:

Plaintiffs, Ron and Barbarann Hubble, appeal from a grant of summary judgment entered by the circuit court in favor of defendants, Paul O'Connor and Lynda Simon. In their complaint, plaintiffs (sometimes hereinafter, "sellers") sought to recover damages from the defendants (sometimes hereinafter, "purchasers") for an alleged breach of a contract to purchase certain residential real estate. Only count I of the sellers' complaint, that count relating to a breach of contract claim, is before us on appeal.

The facts of this case revolve around a common real estate transaction involving the purchase of a condominium. The written contract at issue contained an attorney review provision which allowed the contract to be voided if either sellers' or purchasers' attorney gave written notice of disapproval within 5 business days after formation of the contract. Although the agreement was signed and tendered by defendant-purchaser Paul O'Connor to seller-plaintiff Ron Hubble, the parties continued to discuss modifications to the agreement past the disapproval period. Two weeks after the disapproval period had expired, purchasers' attorney gave notice that he was invoking the disapproval clause. The parties filed cross-motions for summary judgment and, on February 28, 1996, the circuit court entered judgment in favor of the purchasers and against the sellers.

The contract is a standardized real estate sales agreement widely used in the Chicago area. The agreement was executed on June 8, 1993. The attorney disapproval clause within the agreement states in pertinent part:

"This contract is contingent upon the approval hereof as to form by the attorney(s) for Buyer and Seller within 5 Business days after Seller's acceptance of this contract. Unless written notice of disapproval is given within the time period specified above, then this contingency shall be deemed waived and this contract will remain in full force and effect.

If written notice of disapproval is given within the time period specified above, this contract shall be null and void and the earnest money shall be returned to the Purchaser."

The contract also provides that notice of disapproval may be given or accepted by either of the parties' attorneys.

Although the attorney disapproval clause expired by its own terms on June 15, 1993, the parties agreed on that day to extend the disapproval period to June 22, 1993. This extension was memorialized in a letter from purchasers' attorney to sellers' attorney. Sellers' attorney returned the letter to purchasers' attorney with his signature, formally approving the extension.

On June 17, 1993, purchasers' attorney faxed to the sellers a "proposed Rider to the contract for review and comment." On June 18, 1993, sellers' attorney submitted modifications to the purchasers' proposed rider. On June 21, 1993, purchasers' attorney incorporated the sellers' modifications into the rider and faxed the rider back to sellers' attorney. At this point in time the rider was finalized, but had not yet been executed.

On June 22, 1993, the last day of the contract disapproval period, sellers' attorney telephoned purchasers' attorney to inquire whether purchasers would agree to delaying the possession date. He suggested that the sellers lease the property back from purchasers for a short period of time following the closing. Purchasers' attorney responded by proposing trading the later possession date for a change in the form of the earnest money. Sellers' attorney agreed to the change in a telephone call that same day.

On June 30, 1993, sellers' attorney received the last rider from purchasers' attorney. This rider incorporated all the changes discussed on June 22, 1993, but left the exact possession date blank. Upon receipt of the document, sellers' attorney telephoned the office of purchasers' attorney and was instructed that the possession date to be inserted into the blank was "on or before August 23, 1993." The rider, however, remained unexecuted.

On July 6, 1993, in a letter written to sellers' attorney, purchasers' attorney summarily stated he had "withdrawn attorney approval." He requested that the sellers return to his clients their earnest money.

On August 7, 1993, sellers put the property back on the market. The property ultimately sold at the end of January, 1994, for $315,000, an amount $15,000 less than provided in the June 8 contract. Sellers claimed in their complaint that, in addition to selling the property at a lower price, they were forced by purchasers' breach to incur costs of $15,698.83 in carrying the property from August 1993 through January 1994.

In seeking summary judgment, sellers asserted that the purchasers had not exercised the attorney disapproval clause in a timely manner, and that the attempt to exercise it on July 6, 1993, was designed simply to exculpate purchasers from their binding contractual obligation to purchase the property. Sellers noted that purchasers conceded during discovery that part of their motivation in having their attorney withdraw his approval for the agreement was because defendant Paul O'Connor had a business opportunity to relocate from Chicago to Budapest, Hungary. Sellers also included in the motion excerpts from the deposition of defendant Lynda Simon in which she stated that, although she had not actually signed the June 8, 1993, real estate agreement itself, she had given permission to Paul O'Connor to sign her name to the contract. An examination of the sales agreement shows that both Lynda Simon and Paul O'Connor are identified as "purchasers." Lynda's signature, however, is followed by the annotation, "by Paul."

Purchasers filed their cross motion for summary judgment asserting both that the attorney disapproval provision had been properly exercised and that the Illinois Fraud Act (the Statute of Frauds) prevented sellers' from enforcing the agreement. Purchasers based their Statute of Frauds argument on the fact that Lynda Simon had never actually signed the sales agreement and that it had been signed only by Paul. They argued that the contract was therefore incomplete and therefore could not be enforced against either Lynda or Paul. They also argued that the sellers' failure to sign the proposed rider which had been negotiated by the attorneys, but ultimately disapproved by their attorney prior to its execution, precluded contract formation.

As we have noted, the trial court granted purchasers' summary judgment motion and denied sellers' motion. The court ruled that the riders and letters written by purchasers' attorney constituted disapproval and thus voided the contract.

In Illinois, summary judgment is governed by the provisions of section 2-1005 of the Code of Civil Procedure. 735 ILCS 5/2-1005 (West 1994). Summary judgment is recognized to be a drastic remedy which is properly granted only where the movant's right to it is clear and free from doubt. Vicorp Restaurants v. Corinco Insulating Co., 222 Ill.App.3d 518, 165 Ill.Dec. 50, 584 N.E.2d 229 (1991). The purpose of the summary judgment procedure is to determine whether there are any genuine issues of material facts between the parties. Vallejo v. Mercado, 220 Ill.App.3d 1, 162 Ill.Dec. 692, 580 N.E.2d 655 (1991). Summary judgment should be granted only if the pleading, depositions, admissions and affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Dash Messenger Service, Inc. v. Hartford Insurance Co., 221 Ill.App.3d 1007, 164 Ill.Dec. 313, 582 N.E.2d 1257 (1991).

When all parties move for summary judgment, as here, the trial court is invited to decide the issues presented to it as a matter of law, and entry of summary judgment for one party or the other is proper. Maywood Proviso State Bank v. York State Bank & Trust Co., 252 Ill.App.3d 164, 171, 192 Ill.Dec. 123, 625 N.E.2d 83 (1993). Review in the appellate court of a grant of summary judgment is de novo. Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill.2d 90, 102, 180 Ill.Dec. 691, 607 N.E.2d 1204 (1992).

In this case, the dispositive issues are: (1) whether the parties entered into a valid contract on June 8, 1993, when Ron Hubble and Paul O'Connor signed the sales agreement; (2) if there was a valid contract, whether the parties' subsequent discussions concerning the proposed rider acted as an implied disapproval; and (3) whether the failure of defendant Lynda Simon to sign her own name to the agreement precludes enforcement of the contract against either her or her co-defendant, Paul O'Connor.

We begin our analysis by noting that contract formation requires only the existence of an offer, an acceptance, and consideration. La Salle National Bank v. Vega 167 Ill.App.3d 154, 117 Ill.Dec. 778, 520 N.E.2d 1129 (1988). In addition, to be enforceable, an agreement must be sufficiently definite so that the terms thereof are reasonably certain and able to be determined. Kraftco Corp. v. Kolbus, 1 Ill.App.3d 635, 274 N.E.2d 153 (1971). Putting aside for the purposes of our initial discussion the Statute of Frauds questions presented, the record establishes that the purchasers submitted an offer to buy the sellers' condominium, promising to pay $330,000. The offer contained a condition subsequent, i.e., if either attorney disapproved of the contract within a...