Jones v. Seiwert

• Decision Date: 17 December 1987
• Docket Number: No. 86-2634,86-2634
• Citation: 115 Ill.Dec. 869,164 Ill.App.3d 954,518 N.E.2d 394
• Parties: , 115 Ill.Dec. 869 Joanne JONES and Edward Hansen, Plaintiffs-Appellants, v. Timothy SEIWERT, Kathleen Seiwert, Helen Green-Fritz and Schneider Realty, Defendants-Appellees.
• Court: United States Appellate Court of Illinois

Page 394

518 N.E.2d 394

164 Ill.App.3d 954, 115 Ill.Dec. 869

Joanne JONES and Edward Hansen, Plaintiffs-Appellants, v. Timothy SEIWERT, Kathleen Seiwert, Helen Green-Fritz and Schneider Realty, Defendants-Appellees.

No. 86-2634.

Appellate Court of Illinois First District, Fourth Division.

Dec. 17, 1987.

Carper and Rubesh, Chicago, for plaintiffs-appellants.

Lawrence P. Seiwert, Chicago, for defendants-appellees, Timothy Seiwert, Kathleen Seiwert and Helen Green-Fritz.

Justice JOHNSON delivered the opinion of the court:

Plaintiffs, Joanne Jones and Edward Hansen, brought an action in the circuit court of Cook County against defendants, Timothy Seiwert, Kathleen Seiwert, Helen Green-Fritz and the Schneider Realty Company. Pursuant to a real estate purchase contract, plaintiffs deposited earnest money with Schneider Realty to buy real estate owned by the Seiwerts and Green-Fritz (hereinafter "sellers"). The sellers subsequently declared plaintiffs to have defaulted on their contractual obligations and, consequently, to have forfeited the earnest money, of which plaintiffs seek recovery. The trial court granted defendants' motion for summary judgment. Plaintiffs appeal, contending that the trial court erred in granting summary judgment for defendants.

We reverse.

The record shows that on April 28, 1985, plaintiffs and sellers signed a standard form real estate contract, whereby plaintiffs agreed to buy the sellers' home for $125,000. Pursuant to the contract, plaintiffs deposited $6,250 in earnest money with Schneider Realty, the broker. The sale was further subject to plaintiffs obtaining a mortgage commitment, as specified in the contract, for the remaining $118,750, within 45 days, i.e., by June 12, 1985. On that date, plaintiffs informed sellers by letter that they had not yet been able to obtain a mortgage commitment. Plaintiffs requested and received a 15-day extension, i.e., until June 27, 1985. On that date, plaintiffs again notified sellers by letter that they had been unable to obtain a mortgage commitment. Plaintiffs requested and received a 30-day extension, i.e., until July 27, 1985.

The record further shows that on July 16, 1985, plaintiffs obtained a conditional mortgage commitment from the West America Mortgage Company. The commitment was subject to several conditions, including the making of several repairs on the property. Sellers received a copy of this conditional commitment. The repairs required to obtain the mortgage commitment were not made during the second extension, i.e., the extension until July 27, 1985.

On August 16, 1985, plaintiffs still had not been able to obtain financing pursuant to the contract; they requested the return of the earnest money. On September 5, 1985, sellers declared plaintiffs to be in default because (1) plaintiffs' extension expired on July 27, 1985 and (2) plaintiffs did receive the conditional mortgage commitment from West America, but they failed to satisfy all of its conditions. Sellers, therefore, directed Schneider Realty to transfer to them the earnest money. The record contains an affidavit from sellers' attorney stating that sellers made the repairs required to obtain the West America mortgage commitment in September or October 1985.

Plaintiffs brought the present action against sellers and Schneider Realty on December 10, 1985; they filed an amended complaint on March 13, 1986. On July 11, 1986, the trial court granted sellers' motion for summary judgment. Plaintiffs appeal.

When a plaintiff appeals from a trial court's order of summary judgment for a defendant, the only issue on appeal is whether "the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (Ill.Rev.Stat.1985, ch. 110, par. 2-1005(c).) Summary judgment is the proper procedure where only the construction and validity of a contract are at issue. Sears Bank & Trust Co. v. Holmstad, Inc. (1985), 132 Ill.App.3d 229, 232, 87 Ill.Dec. 443, 445, 477 N.E.2d 44, 46.

Further, when a party to a real estate contract declares a forfeiture, a court follows the provisions in the contract. (Bocchetta v. McCourt (1983), 115 Ill.App.3d 297, 299-300, 71 Ill.Dec. 219, 221, 450 N.E.2d 907, 909.) As a general rule, courts do not look upon contract forfeitures with favor. (Hockenbury v. Lorentz (1976), 35 Ill.App.3d 983, 985, 343 N.E.2d 90, 92.) As a result, courts must construe contract forfeiture provisions strictly and narrowly. The party seeking to enforce the forfeiture must prove that the right to forfeiture clearly and unequivocally exists and that the exercise of the right will cause no injustice. 115 Ill.App.3d 297, 300, 71 Ill.Dec. 219, 221, 450 N.E.2d 907, 909.

In the instant case, paragraph 3(c) of the contract provided in pertinent part:

"(c) Mortgage Contingency. This contract is contingent upon Purchaser securing within 45 days of acceptance hereof a mortgage commitment for $118,750 * * *. If Purchaser does not obtain such commitment, Purchaser shall notify Seller in writing within said number of days. If Seller is not so notified, it shall be conclusively presumed that Purchaser has secured such commitment or will purchase said property without mortgage financing. If Seller is so notified, Seller and/or Broker may, within an equal number of additional days, secure a mortgage commitment for Purchaser upon the same terms, and said commitment may be given by...