La Salle Nat. Bank v. 53rd-Ellis Currency Exchange, Inc.

• Decision Date: 30 June 1993
• Docket Number: No. 1-91-0636,1-91-0636
• Citation: 249 Ill.App.3d 415,188 Ill.Dec. 533,618 N.E.2d 1103
• Parties: , 188 Ill.Dec. 533 LA SALLE NATIONAL BANK as Trustee u/t/n 10-29003-09 and Sharon Wasserberg, Plaintiffs-Appellees, v. 53rd-ELLIS CURRENCY EXCHANGE, INC., and Sidney Miller, Defendants-Appellants.
• Court: United States Appellate Court of Illinois

Page 1103

618 N.E.2d 1103

249 Ill.App.3d 415, 188 Ill.Dec. 533

LA SALLE NATIONAL BANK as Trustee u/t/n 10-29003-09 and Sharon Wasserberg, Plaintiffs-Appellees, v. 53rd-ELLIS CURRENCY EXCHANGE, INC., and Sidney Miller Defendants-Appellants.

No. 1-91-0636.

Appellate Court of Illinois First District, Fifth Division.

June 30, 1993.

Rehearing Denied Aug. 10, 1993.

James P. Nally and Robert E. Colan, Chicago, for defendants-appellants.

Daniel S. Hefter & Associates, Chicago, for plaintiffs-appellees (Daniel S. Hefter, John R. Heine, and Richard A. Mertz, of counsel).

Presiding Justice GORDON delivered the opinion of the court:

Plaintiffs brought suit seeking a declaratory judgment to their rights under a five-year lease, possession of the premises, and rescission of a twenty-year lease for the same property. After a bench trial, the trial court found that the 20-year lease in question was invalid as it was the product of undue influence and that even if no undue influence was present, the 20-year lease had been effectively rescinded. On appeal, defendants challenge these findings. Defendants also contend that the trial court erred in considering for impeachment purposes numerous alterations to a witness' deposition and abused its discretion in refusing to permit them to amend their pleadings to add an equitable estoppel defense. Finally, defendants contend that the plaintiffs should be denied recovery under the doctrine of unclean hands and because they have waived their right to challenge the 20-year lease by accepting rent payments under it. For the reasons set forth below, we affirm the decision of the trial court.

FACTS

This suit involves a dispute between two siblings, Sharon Wasserberg and Sidney Miller, which arose out of actions taken by their terminally ill father, Joseph Miller (hereinafter "Joseph"). Joseph owned, operated and was sole shareholder of the 53rd & Ellis Currency Exchange, Inc. (hereinafter "currency exchange") which was organized as a corporation. The currency exchange was located in a building at 5305-9 South Ellis Ave. and 1001-1013 1/3 East 53rd Street which was "owned" by Joseph. The ownership to the building was held in a land trust by the La Salle National Bank (hereinafter "bank") as trustee. The trust agreement specifically provided that the trustee "will deal with said real estate only when authorized to do so in writing * * * on the written direction of Joseph Miller."

At various times during 1986, Joseph executed three leases for the currency exchange: 1) a five-year lease running from May 1, 1986, to April 31, 1991, which was executed in May 1986; 2) a 20-year lease executed in October 1986 which ran from November 1, 1986, through April 31, 1991, with an option to the lessee; and 3) a one-year lease executed in November 1986 which ran from November 1986 through November 1987. The issue before us with respect to these leases is whether the 20-year lease was validly executed and if so, whether it was subsequently rescinded.

Pursuant to Joseph's will, after his death in December 1986, Sharon received ownership of the building and Sidney of the currency exchange. Subsequently, in April of 1988, plaintiffs brought suit seeking declaratory judgment as to their rights under the five-year lease, possession of the premises, and rescission of the 20-year lease. A bench trial was held at which the following testimony was heard.

Michael Wasserberg (hereinafter "Michael"), Sharon's husband, testified that he had been property manager of the 53rd-Ellis building since 1985. He said that the Michael stated that in April 1986 Joseph said that he was thinking about giving the currency exchange to his son, Sidney, and the building to his daughter, Sharon, after he passed away. In May 1986, Joseph was hospitalized with terminal cancer and in June he was moved to a nursing home where he stayed until August 1986. In August, he returned to his personal residence and lived there until his death in December 1986.

[188 Ill.Dec. 537] building had 43 apartments and 9 store fronts, one of which was occupied by the currency exchange. In April 1985, Joseph directed him to execute a lease for the currency exchange with a term beginning May 1, 1985, through April 30, 1986, at a rental rate of $650 per month. Michael prepared the one-year lease which he testified was their "standard practice" at the time.

Michael said that Joseph had been bedridden since May 1986 and that he never regained full use of his limbs. In June 1986, Joseph consulted Michael as to what he thought would be a fair long term lease for the currency exchange and was advised by Michael to make it five years. A short time thereafter, Joseph directed him to prepare a five-year lease with the usual rider for a term from May 1986 through April 1991 starting at $700 a month and increasing in $25 increments every year. Michael testified that he executed the lease on behalf of the building and Joseph executed it on behalf of the currency exchange.

Michael stated that he and Sharon received a phone call on November 7, 1986, from Joseph who sounded distraught, repeatedly stating that he had done "something awful." He then told them that Sidney had been constantly pressuring him and that as a result he had signed a 20-year lease for the currency exchange. Joseph said that Sidney brought the lease for him to sign and then went to register it with the trust.

Michael said that he and Sharon then placed a conference call to George Heisler who had been Joseph's attorney since 1974. Joseph related that he had been pressured by Sidney to execute the 20-year lease and asked Heisler to correct the matter by executing a one-year lease. Joseph stated that he wanted the one-year lease because Sidney had been jeopardizing the status of the building and was acting like a "bastard."

Michael recounted that Heisler felt it was not his place to draft any additional documents because he had not prepared the 20-year lease. Heisler suggested that they call the attorney who had prepared that lease, Irving Slutzky. Michael testified that he placed a conference call with Slutzky and Joseph at which time Joseph expressed that he had made a mistake in executing the 20-year lease and wanted to execute a one-year lease in its place. According to Michael, that same afternoon, at Joseph's direction, he went to Slutzky's office and picked up the one-year lease and brought it to Joseph at his home where he read, signed and affixed the corporate seal to the lease.

According to Michael, it was at this time that Joseph again detailed the pressure he had received from Sidney. Joseph told him that Sidney would call or visit every morning and would then call six or seven times during the day about the term of the lease. Joseph then told Michael to have the one-year lease lodged with the bank, but Michael did not do so.

Michael then described a meeting which he, Sharon, Sidney, and Heisler all attended on November 12, 1986, at Joseph's residence. After Heisler left, they discussed the lease at which time Joseph told Sidney that he did not have a lease. Two weeks after that meeting, Joseph told Michael that he had his nurse, Ethel Tripp, carry a document to the bank rescinding the 20-year lease.

Ethel Tripp testified that she was a certified nurse's aide who took care of Joseph at his residence from August 1986 until Joseph's death in December of that year. She stated that on November 13, 1986, Joseph asked her to take a sealed manilla envelope to Mrs. Welter at the La Salle National Bank and she did so. After she returned, Joseph received a phone call from the bank and then sent her back to the Rita Welter, an assistant secretary and real estate officer of the bank during 1986, identified a letter of direction that she received on November 13, 1986, which directed the bank to execute a lease and to cancel the five copies of the lease that had been executed by the trustee. She stated that she told the person bringing in these documents (Ethel Tripp) that the land trust does not cancel leases and that the beneficiary must do that. Welter explained to the bearer that the unsigned documents could be left in the file for safekeeping, but to make it clear on the record the beneficiary should do something in writing. Welter testified that the documents were then turned back to the person who delivered them. They were subsequently returned to the bank with a handwritten letter from Joseph. These documents were then lodged in the trust file.

                [188 Ill.Dec. 538] bank with an unsealed envelope.  Tripp stated that Joseph was "acting really funny."   She looked inside of this envelope and saw, among other things, a small paper about the currency exchange which she identified at trial as a handwritten letter of direction ordering the trustee to cancel the lease.  She then took the envelope to the bank and gave it to the same lady
                

Joseph Lang, the head of the land trust department at the bank, testified that the trustee need not form an intent to cancel a lease if the beneficiary of the land trust notifies the land trust of its intention to cancel a lease, even where the lease has been executed by the trustee. He stated that a lease is cancelled by a termination agreement between the parties and the trust is not involved. He continued, "the trustee really does not make any decision. It is a mechanical movement, so to say. We get a direction to execute a document, we execute a document when directed. The trust beneficiary subsequently says that document as it is executed is null and void, per my direction. To us that terminates it. There is no further intent or anything on behalf of or by the trustee."

Irving Slutzky, an attorney who had represented Joseph intermittently since 1981, testified that in October and November 1986 he had several meetings with Sidney concerning a 20-year lease which he prepared on October 31, 1986, pursuant to instructions from Sidney and...