author: JUSTICE JOHNSON

text:
    155 HARBOR DRIVE CONDOMINIUM ASSOCIATION, Plaintiff-Appellant, v. HARBOR POINT INCORPORATED et al., Defendants-Appellees.
    First District (4th Division)
    Nos. 1-88-3158,1-88-3492 cons.
    Opinion filed February 7, 1991.

      Ira Gould and Aaron C. Horowitz, both of Holleb & Goff, of Chicago, for appellant.
    Edna Selan Epstein, of Chicago, for appellees T.I.C. Venture, Harbor Point Venture, Illinois Center Corporation, and Talman/Home Investments, Inc.
    Pedersen & Houpt, of Chicago (Donald J. Moran and Marilee Roberg, of counsel), for appellee Elsa Benson, Inc.
    Larry Selander, David E. Schaper, and Sonia U. Chae, all of Keck, Mahin & Cate, of Chicago, for appellee Crescent Erection Company.
    ' Robert E. Shapiro, of Barack, Ferrazzano, Kirschbaum & Perlman, of Chicago, for appellee Consolidated Aluminum Corporation.
   JUSTICE JOHNSON

delivered the opinion of the court:

Plaintiff, 155 Harbor Drive Condominium Association, is appealing the dismissal of its action in the circuit court of Cook County. Plaintiff seeks to set aside the decision of the trial court that found its complaint against defendants did not state a valid cause of action.

The following issues are before this court for review: (1) whether the trial court erred when it ruled that the breach of warranty claims were acts arising out of the construction of a building, and that the construction statute of limitations (Ill. Rev. Stat. 1981, ch. 110, pars. 13 — 214(a), (b)) was applicable; (2) whether the trial court erred when it ruled that the construction statute of limitations had expired, barring the warranty claims; and (3) whether the 155 Harbor Drive Condominium Association is a third-party beneficiary of the construction subcontract entered into by Crescent Erection Company and Consolidated Aluminum Corporation, thereby enabling plaintiff to seek recovery from Crescent Erection Company for alleged construction defects.

We affirm.

Background

This action arises out of the development of a condominium building located at 155 East Harbor Drive in Chicago, Illinois (hereinafter building). The contractors began construction on the building in 1973. The building was completed in 1975.

The original owner and developer was a joint venture composed of four entities known as the T.I.C. Venture parties. The T.I.C. Venture parties consisted of defendants T.I.C. Venture,' Harbor Point Venture, Hlinois Center Corporation, and Talman/Home Investments, Inc. Illinois Center Corporation was Harbor Point Venture’s general partner. Talman/Home Investments, Inc., was Harbor Point Venture’s limited partner. In July of 1976, Harbor Point Incorporated, a defendant in the trial court that is not a party to this appeal, became the successor in interest to T.I.C. Venture.

Defendants Elsa Benson, Inc. (hereinafter Benson), Consolidated Aluminum Corporation (hereinafter Conalco), and Crescent Erection Company (hereinafter Crescent) were subcontractors. Benson was the general contractor for the project. The contract with Benson to be the general contractor includes, but is not limited to, a standard form of agreement between owner and contractor, general conditions of the contract for construction (AIA Document A201), supplementary general conditions, general requirements specifications, and architectural, engineering and shop drawings. These various documents are hereinafter referred to as the “Benson contract.” Benson hired Conalco as one of the subcontractors. The contract between Benson and Conalco incorporates by reference the terms and conditions of the Benson contract. Conalco worked on the curtain wall and subcontracted some of the work to Crescent.

The Benson contract made the following warranties to the future individual condominium unit owners:

“(i) ADDITIONAL CONSTRUCTION WARRANTY FOR CONDOMINIUM UNIT PURCHASERS:
1. The Contractor warrants the workmanship and materials in the individual apartment units ***. See Warranty Form to be furnished by the Owner to each unit apartment owner. This warranty shall also apply to the common and public elements ***.
2. The above warranty for Condominium Units does not supersede the general guarantee described by AIA General Conditions, article 13.2.2, but is in addition thereto ***.
(ii) WARRANTY TO CONDOMINIUM PURCHASERS:
It is a requirement under the Construction Contract Agreement that the Contractor assumes and accepts the total responsibility for fulfilling on behalf of Owner and he shall bind his Subcontractor to accept as their responsibility the work requirements [under the Owner’s warranty] *** which shall be furnished to each Condominium Unit Apartment Owner.

(iii) LIMITATION ON DURATION OF CONTRACTOR’S WARRANTY OBLIGATIONS:

a. General Rule. Notwithstanding the provisions of Paragraphs 4A and 4B of the General Requirements, Paragraph 13.2.2 of the General Conditions, SGC-19 and SGC-20 (herein called ‘Warranty Obligations’), the Warranty Obligations shall, subject to the provisions of Paragraph B below, commence and expire as follows:
1. Commence, as to each Condominium Apartment Unit, upon substantial completion of the Work therein, and expire one year from the Date of Substantial Completion of the Project.
2. Commence, as to the Work located in the portions thereof located at and below the lower 30 apartment floors, and not located in. a Condominium Apartment Unit, upon substantial completion of said lower 30 apartment floor, and expire one year from the date of Substantial Completion of the Project, and expire one year form the Date of Substantial Completion of the Project.
b. Exceptions. The provisions of Paragraph a, above, are subject to the following exceptions: (1) Warranties specified in the Contract Documents for periods longer than the period specified in Paragraph a, above, shall be for the periods specified ***.
(iv) *** [E]ach Condominium Unit Purchaser shall have the option of certain construction items, materials and equipment * * *
(v) Contractor and each Subcontractor shall assign to Owner or as the Owner may direct to the individual apartment condominium Owner, all manufacturer’s warranties of material or equipment.
(vi) GUARANTEE [curtain wall]: Before final payment is made, the Subcontractor shall guarantee in writing that all parts of his work meet with the specification requirements and will be free from defects for a period of five years from the date of acceptance of the work.”

The Benson contract also made the following guarantees:

“(vii) GUARANTEE [glass and glazing]:
Guarantee period shall be five (5) years from date of acceptance by Architect or original glazing work requirements. Insulated glass units shall in addition carry a twenty (20) year warranty from the manufacturer.
(viii) Contractor and each Subcontractor guarantees to Owner that, whether furnished by Contractor or any Subcontractor, the labor used in performing the Work on the Project, and the material sand equipment incorporated into the Project, will be of good workmanship, free of defects, and fit for the use intended therefor.
(ix) The guaranties referred to in 4A shall continue for the period of one (1) year from and after the date Architect certifies that Project to be completed unless otherwise specifically noted for a longer period. Should any defects in the work, materials, or equipment develop within the period of the guaranty, Contractor and the Subcontractor who furnished the defective work, materials or equipment shall, at their expense and at no cost to Owner, correct the same to Architect’s and Owner’s satisfaction, including the repair of any other work damaged or otherwise affected by doing the corrective work.”

The contract between Conalco and Benson incorporated by reference the terms and conditions of the Benson contract. In addition to its incorporation of the nine aforementioned provisions of the Benson contract, the Conalco contract established a “warranty fund” to serve “as security for the performance by Subcontractor of Warranty Service to Condominium purchasers, and all other warranties of Subcontractor contained in the Benson Contract.” Another provision provided:

“[A]ll materials shall be new and both workmanship and materials shall be of good quality. Should any imperfect workmanship or material or other faults appear within the time period specified in SGC-10A, which in the judgment of the Owner and/ or Contractor arise out of improper material or workmanship, the Subcontractor shall correct and make good any such fault at his own expense, and in case of failure so to do, the Contractor may do said work and replace said material and recover from the Subcontractor the cost thereof.”

The contract between Conalco and Crescent contained a provision in which Crescent “agree[d] to be bound by the Subcontract between [Conalco] and [Benson] and the general conditions, drawings and specification referred to therein.” Crescent also agreed to honor the warranty obligations to the individual condominium unit owners which were contained in the Benson contract.

In July of 1976, T.I.C. Venture sold some of the units in the building. Upon the sale of those units, T.I.C. gave a “Certificate of Warranty” against latent construction defects. The written warranty to the condominium purchasers was signed by the developer. The warranty made the following provisions:

“[F]or a period of one (1) year from the date of this warranty set fourth [sic] below, against latent defects arising out of faulty workmanship or material ***.
The foregoing warranty shall also apply to the Common Elements of the condominium in which the Purchased Unit is located, except that such warranty shall in all events terminate upon the expiration of one (1) year from the date of substantial completion of the affected portion of the Common Elements.”

In addition, the warranty made the following express limitations in bold type: “This warranty is in lieu of all other warranties of seller, express or implied, and inures only to the benefit of the purchaser who has signed and approved this warranty.”

Furthermore, a section entitled “Warranty Exclusions” provided that “[w]arranty service is not available for the Common Elements after one (1) year from the date of substantial completion of the affected portion thereof, even though Purchaser may not have owned a Purchased Unit during the warranty period.”

Finally, under the section entitled “Other Terms,” the warranty stated that “[n]o steps taken by Seller to correct defects shall act to extend the warranty beyond the warranty period.”

After the units were sold, plaintiff noticed defects in the curtain wall and the window units. The building curtain wall failed to properly keep water and air out of the condominium units, and there was excessive breaking and fogging of certain window units. On February 17, 1982, the 155 Harbor Drive Condominium Association (hereinafter plaintiff or Association) filed a complaint. The Association filed this complaint seven years after the defects became apparent. The Association named the following four defendants: Harbor Point Incorporated; Benson; Conalco; and WDS, Inc., as the alleged successor in interest to Crescent. Crescent was later substituted for WDS as a defendant after plaintiff and WDS agreed that Crescent was the proper party to this action. This change was made in an agreed order dated November 1, 1985.

Plaintiff alleged in the complaint that there were defects in the window units and the curtain wall of the building.' Plaintiff also maintained that it was a third-party beneficiary to the developer’s contract with Benson, Benson’s contract with Conalco, and Conalco’s contract with Crescent. Harbor Point Incorporated, Benson, Conalco, and Crescent attempted to repair the window units and the curtain wall.

The contract with Benson identified “each Condominium Unit Apartment Owner” as having rights directly against the contract under the warranty to be given to each unit owner by Harbor Point Incorporated. The agreement provided that “the contractor assumes and accepts the total responsibility for fulfilling on behalf of Owner and shall bind his Subcontractor to accept as their responsibility the word requirements [under the Owner’s warranty] *** which shall be furnished to each Condominium Unit Apartment Owner.” Furthermore, the contract provided that “[t]he Contractor warrants the workmanship and materials in the individual apartment units.”

In addition, the general contract provided that the subcontractors Conalco and Crescent were to perform warranty work for and on behalf of each condominium purchaser, and that a “Warranty Fund” would be established “as security for the performance by Subcontractor of Warranty service to Condominium purchasers, and all other warranties of Subcontractor contained in the Benson Contract.”

The Association filed its first amended complaint on June 15, 1984. The first amended complaint alleged breaches of implied and express warranties, and negligence in the design and installation of the building’s curtain wall. Plaintiff also requested damages in excess of $3 million from Conalco, Crescent and T.I.C. Venture. Plaintiff also joined Sudler & Company, the building manager, as a defendant.

Benson, Conalco and WDS later moved to dismiss the claims against them on August 17, 1984, pursuant to section 2 — 615 of the Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, par. 2 — 615). The motion was based on the theory that plaintiff’s claims were only valid against the developer, and that the Association failed to plead facts sufficient to establish that it was a third-party beneficiary. The trial court dismissed the claims against these defendants. The court held that the Association was not a third-party beneficiary of the contract and warranties given by Benson and Conalco. After considering additional information, the court confirmed the dismissal on June 7, 1985.

On June 24, 1985, the Association filed its second amended complaint. The Association alleged that the developer and the contractor defendants breached the implied warranty of habitability. The Association also contended that the developer wrongfully refused to file a third-party action against the contractor defendants.

On July 24, 1985, Benson, Conalco, and WDS moved to dismiss the Association’s implied warranty claim on the grounds that the action was appropriate only against the developer or the developer’s predecessors in interest. On January 6, 1986, the court granted Conalco and Crescent their motions to dismiss the implied warranty of habitability claims. However, Benson’s motion to dismiss was denied. Benson filed a motion to reconsider the court’s order denying the motion to dismiss on January 30, 1986. On March 5, 1986, the court granted Benson’s motion to reconsider and motion to dismiss.

Plaintiff filed an additional amended complaint on March 5, 1986. Plaintiff named T.I.C. Venture, Harbor Point Venture, Illinois Center Corporation, and Talman/Home Investments as additional defendants.

T.I.C. Venture later moved to dismiss on April 9, 1986. T.I.C. Venture filed additional motions to dismiss pursuant to sections 2 — 615 and 2 — 619 of the Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, pars. 2 — 615, 2 — 619) on March 19, 1987. In addition, Crescent moved to dismiss on May 18, 1987, and May 26, 1987, and Benson filed a motion to dismiss on May 26, 1987. The courts granted Benson’s and Crescent’s motions to dismiss on June 19, 1987.

Plaintiff filed its fifth amended complaint on July 14, 1987. In this amended complaint, plaintiff alleged that the problems with the walls and the window units became apparent “within one year after substantial completion of construction of the Building in July, 1975.” Plaintiff also alleged that it noticed that additional symptoms, evidencing a construction design defect at various times up to April 1984.

Benson filed a motion to dismiss on the grounds that the Association’s naming of the T.I.C. Venture parties as defendants relieved Benson of any responsibility pursuant to the implied warranty of habitability. On June 19, 1987, the court dismissed all of the claims against Crescent, Conalco and Benson.

T.I.C. Venture also moved to dismiss the case pursuant to section 2 — 619 of the Code of Civil Procedure. (Ill. Rev. Stat. 1981, ch. 110, par. 2 — 619.) T.I.C. Venture contended that the action against it was barred by the expiration of the relevant statute of limitations period. This motion was argued on June 19, October 30, and December 30, 1987.

On December 30, 1987, the trial court granted T.I.C. Venture’s motion to dismiss counts I and II of the fifth amended complaint pursuant to section 2 — 619 of the Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, par. 2 — 619). Judge Gomberg held that these claims were not filed within the applicable four-year statute of limitations pursuant to section 13 — 214 of the Code of Civil Procedure. (Ill. Rev. Stat. 1981, ch. 110, par. 13 — 214.) Judge Gomberg also made the following ruling: (1) the construction design defects complained of arose out of acts or omissions in the planning, design, supervision, and management of the building’s construction; (2) that the construction statute of limitations applied to plaintiff’s express and implied warranty claims; and (3) that plaintiff would, as a matter of law, be deemed to have known of the latent defects no later than February 17, 1982, the date that the suit was filed with respect to those defects.

On August 3, 1988, the T.I.C. Venture parties filed a request for a finding with respect to the Association’s claims against them pursuant to Supreme Court Rule 304(a) (107 Ill. 2d R. 304(a)). The Association responded by seeking certification of its claims against the T.I.C. Venture parties and the contractor defendants. On September 22, and November 3, 1988, the trial court made these final judgments appealable by virtue of the entry of three Rule 304(a) orders. This appeal followed.

Four counts of the verified fifth amended complaint are at issue in this appeal. Counts III and VI allege that Benson", Conalco, and Crescent have failed or refused to replace the defective window “lites” and defective curtain wall pursuant to the express warranties in the Benson contract, the Conalco contract, and the Crescent contract, notwithstanding repeated requests by the Association, and are therefore in breach of the express warranties contained therein. Count IX alleges breach of warranty with respect to defective curtain wall repairs. Count XI states that defendants breached their implied contractual obligations to plaintiff to design, manufacture, construct, install and supervise the installation of the window units and curtain wall in such a manner as to conform to the Benson contract’s requirements and specifications.

Opinion

I

First, plaintiff contends that the court erred when it ruled that the breach of warranty claims were acts arising out of the construction of a building and that the construction statute of limitations was applicable. (Ill. Rev. Stat. 1981, ch. 110, par. 13 — 214.) Plaintiff reasons that the statute does not apply because the language of the statute means the statute encompasses only causes of action which depend upon an allegation that a defendant did or did not do something that is described in the statute. The fact that the claim may simply arise out of a described activity is not sufficient to bring the claim within the statute based upon the express language of the statute itself. Plaintiff also maintains that landowners and developers are not subject to the construction statute of limitations. Plaintiff relies upon People ex rel. Skinner v. Hellmuth, Obata & Kassabaum, Inc. (1986), 114 Ill. 2d 252, C.S. Johnson Co. v. Champaign National Bank (1984), 126 Ill. App. 3d 508, and on a statement made by then Representative Leinenweber in the course of legislative debate prior to the passage of the construction statute of limitations.

Defendants maintain that landowners and developers come within the ambit of the construction statute of limitations provided that they participate in the design, planning, supervision, observation, or management of construction. Defendants assert, and the trial court agreed, that the construction statute of limitations automatically applied because the warranty/repair contract claim involved even the subject of a defect arising out of construction.

The construction-design management and supervision statute makes the following provision:

“(a) Actions based upon tort, contract or otherwise against any person for an act or omission of such person in the design, planning, supervision, observation or management of construction, or construction of an improvement to real property shall be commenced within 2 years from the time the person bringing an action, or his or her privity, knew or should reasonably have known of such act or omission.
(b) No action based upon tort, contract or otherwise may be brought against any person for an act or omission of such person in the design, planning, supervision, observation or management of construction, or construction of an improvement to real property after 12 years have elapsed from the time of such act or omission. However, any person who discovers such act or omission prior to expiration of 12 years from the time of such act or omission shall in no event have less than 2 years to bring an action as provided in subsection (a).
* * *
(d) Subsection (b) shall not prohibit any action against a defendant who has expressly warranted or promised the improvement to real property for a longer period [which exceeds the statute of limitations,] from being brought within that [longer warranty] period.” (Ill. Rev. Stat. 1981, ch. 110, par. 13 — 214(a), (b), (d).)

The word “person” as used in this section “means any individual, any business or legal entity, or any body politic.” Ill. Rev. Stat. 1981, ch. 110, pars. 13 — 214 (hereinafter the statute).

The fundamental rule of statutory interpretation and construction is that the true intent of the legislature must be ascertained and given effect. (General Motors Corp. v. Industrial Comm’n (1975), 62 Ill. 2d 106, 112; C.S. Johnson Co. v. Champaign National Bank (1984), 126 Ill. App. 3d 508, 510.) “The language used in a statute is the primary source for determining • this intent, and where that language is certain and unambiguous, the proper function of the courts is to enforce the statute as enacted.” (General Motors Corp., 62 Ill. 2d at 112; see also C.S. Johnson Co., 126 Ill. App. 3d at 510.) “Absent statutory definitions indicating a different legislative intent[], courts will assume that words have their [plain,] ordinary and popularly understood meaning.” (General Motors Corp., 62 Ill. 2d at 112.) “Where the statutory language does not adequately convey the legislative intent, the courts may look to the legislative history.” C.S. Johnson Co., 126 Ill. App. 3d at 510.

We do not need to look to the legislative history of this statute in the instant case. The plain, clear meaning of the pertinent provisions of the statute is that the statute is applicable to all “[a]ctions based upon * * * contract *** in the *** observation or management of construction, or construction of an improvement to real property.” (Ill. Rev. Stat. 1981, ch. 110, par. 13 — 214(a).) Subsection (d) of the statute goes so far as to permit actions based upon contract after the statute of limitations has expired where a defendant has expressly warranted the improvement of real property. Ill. Rev. Stat. 1981, ch. 110, par. 13 — 214(d).

This court recently ruled that “[s]ection 13 — 214 encompasses all actions against persons involved in the construction-related activities enumerated in the statute.” (Emphasis added.) American National Bank & Trust Co. v. Booth/Hansen Associates, Ltd. (1989), 186 Ill. App. 3d 865, 867-68.

Accordingly, we hold that the statute is applicable to the instant case because the claim involves an action based upon a warranty, which is a contract, against persons who made repairs and were therefore involved in the construction of an improvement to real property.

Plaintiff’s reliance upon People ex rel. Skinner v. Hellmuth, Obata & Kassabaum, Inc. (1986), 114 Ill. 2d 252, and C.S. Johnson Co. v. Champaign National Bank (1984), 126 Ill. App. 3d 508, is misplaced because both cases are distinguishable from the case at bar. In Skinner, a State agency brought an action for damages arising out of a construction defect against various defendants, including a surety. The issue in Skinner was whether the construction statute applied to the surety when there was no involvement by the surety in any of the acts enumerated by the statute. The Illinois Supreme Court held that the statute did not apply because the issuance of a surety bond did not qualify as an act or omission in the design, planning, supervision, observation, or management of construction. In the instant case, T.I.C. Venture, unlike the surety in Skinner, had direct, significant, and undisputed involvement in the activities set forth in the statute. The record reveals that T.I.C. Venture engaged in multiple acts of planning and on-site supervision of the construction.

Plaintiff’s reliance upon C.S. Johnson Co. is also inappropriate. In C.S. Johnson Co., this court held that there was no evidence in the pleadings that the landowner engaged in any of the construction activities set forth in the statute. For that reason, the court held that the upstream landowner could be sued for having caused flooding to downstream properties even though the ultimate cause of the flooding was alleged to be a construction defect. Accordingly, C.S. Johnson Co. is not authority for the proposition that owners of real property, merely because of their status, are not subject to the construction statute. C.S. Johnson Co. stands for the proposition that where landowners do not engage in the statute’s enumerated activities, they do not have the protection of the statute’s limitation periods.

For the aforementioned reasons, we affirm the trial court’s ruling that the breach of warranty claims were acts arising out of the construction of a building, encompassed by the statute.

II

Plaintiff’s second contention is that the trial court erred when it ruled that the statute had expired, barring its claims for a breach of an express warranty and a breach of the implied warranty of habitability. Plaintiff maintains that the court should have applied the statute retroactively, as amended in 1985. The amended statute provides for a four-year statute of limitations for the bringing of an action from the date that the act or omission was, or should reasonably have been, known. (Ill. Rev. Stat. 1985, ch. 110, par. 13 — 214(a).) Defendant maintains that each warranty claim is time barred by virtue of the two-year construction statute of limitations (Ill. Rev. Stat. 1981, eh. 110, par. 13 — 214(a)), which was applicable at the time this suit was first filed.

The Illinois Supreme Court has held that “when a party knows or reasonably should know both that an injury has occurred and that it was wrongfully caused, the statute begins to run and the party is under an obligation to inquire further to determine whether an actionable wrong was committed.” Nolan v. Johns-Manville Asbestos (1981), 85 Ill. 2d 161, 171; see also People ex rel. Skinner v. Graham (1988), 170 Ill App. 3d 417, 429.

Our supreme court has held that “an amendment which extends a statute of limitations will not be applied retroactively so as to revive a cause of action which had already been barred by the expiration of the original limitation period.” (Hupp v. Gray (1978), 73 Ill. 2d 78, 83; see also People ex rel. Skinner v. Scott (1988), 172 Ill. App. 3d 790, 797.) “In [the] absence of express language declaring otherwise, an amendatory act is ordinarily construed as being prospective in its operation. [Citations.] This general rule is based upon the principle that the legislature may not impair the obligation of contracts [citation] or interfere with vested substantive rights.” Maiter v. Chicago Board of Education (1980), 82 Ill. 2d 373, 390; Weisberg v. Royal Insurance Co. of America (1984), 124 Ill. App. 3d 864, 867-68.

The trial court ruled that plaintiff knew both of its injury and that the injury was wrongfully caused when it filed suit on February 17, 1982. In so ruling, Judge Gomberg made the following statement:

“[I]n 1982 the filing of the lawsuit indicated as a matter of law *** that the plaintiff[] should have known of the alleged negligence of the additional defendants when they filed suit against the subcontractors and sub-subcontractors contracted with.”

The facts establish that the applicable statute of limitations had expired. The record shows that plaintiff knew of T.I.C.’s alleged acts and omission at least as early as July of 1976 and certainly no later than February 1982, when it filed suit against defendants other than T.I.C. entities. Plaintiff has admitted that it became aware of defects in window units and curtain walls within one year of the July 1975 date of substantial completion of the building. Plaintiff has also admitted that it knew of T.I.C.’s existence and that it gave T.I.C. timely written notice of the defects under the warranty. Plaintiff first filed suit in February 17, 1982, years after substantial completion of the building and 5V2 years after the written warranty had expired. When plaintiff first filed suit, it failed to name any of the T.I.C. entities as party defendants on January 28, 1986. Plaintiff first named the T.I.C. Venture parties as defendants on January 28, 1986, approximately four years after the first complaint was filed. Plaintiff should have filed its action no later than February 18, 1984, two years from the date the suit was first filed. By the time the statute was amended, plaintiff’s claims filed on January 28, 1986, against T.I.C. were already time barred by the existing statute of limitations.

We cannot give the 1985 amendment retroactive effect. We must apply the statute as written in 1981 because it was applicable when the instant action commenced in 1982. Accordingly, we find that the 1985 amendment, which extended the statute to four years, does not revive the statute of limitations which had previously expired in 1984. We affirm the trial court’s finding that the construction statute of limitations on the warranty claims expired.

Ill

Finally, plaintiff maintains that it is entitled to recover its losses on account of these warranty violations because it was a direct and intended third-party beneficiary of the contracts between Benson, Conalco, and Crescent. Plaintiff argues that it is a third-party beneficiary of the contract between Benson and T.I.C. Venture because the contract makes repeated references to the individual condominium unit owners who comprise the Association and their warranty rights.

Plaintiff maintains that it is a third-party beneficiary of the contract between Benson and Conalco, first, because it incorporates by reference nine warranty and guaranty provisions of the contract between Benson and T.I.C. Venture; second, because the Conalco contract established a “warranty fund” as a security for the performance by the subcontractor of warranty service to the condominium purchasers; and third, because the contract between Conalco and Benson guaranteed the materials and workmanship used by Conalco. Plaintiff argues that these provisions manifest the parties’ intent that plaintiff directly benefit from the duties that Conalco assumed under its contract. Furthermore, plaintiff argues that the fact that Benson secured from Conalco an agreement to establish the warranty fund is further proof that Benson understood that its own contract with T.I.C. Venture was made for the benefit of plaintiff.

Plaintiff also contends that the Crescent contract includes a provision reflecting the intention to make plaintiff a third-party beneficiary of the Benson contract. Plaintiff maintains that this intent was manifested by a provision in which Crescent agreed to be bound by the general conditions of the subcontract between Conalco and Benson, and to honor the warranty obligations to the individual condominium unit owners which were contained in the Benson contract.

Plaintiff relies upon Gothberg v. Nemerovski (1965), 58 Ill. App. 2d 372, Kravitz v. County of Lake (1978), 62 Ill. App. 3d 101, People ex rel. Resnick v. Curtis & Davis, Architects & Planners, Inc. (1980), 78 Ill. 2d 381, Briarcliffe West Townhouse Owners Association v. Wiseman Construction Co. (1983), 118 Ill. App. 3d 163, and Metro East Sanitary District v. Village of Sauget (1985), 131 Ill. App. 3d 653.

Defendants Benson, Conalco, and Crescent all maintain that it was proper for the trial court to dismiss the third-party beneficiary claims because there was no language or express provision in the construction contracts which manifested the parties’ intent to confer a direct benefit on the Association by making it a third-party beneficiary.

In order to determine whether another is a third-party beneficiary, courts look to the contract to determine the intent of the parties. (Ball Corp. v. Bohlin Building Corp. (1989), 187 Ill. App. 3d 175, 177.) Only third parties who are direct beneficiaries have rights under a contract. (Alaniz v. Schal Associates (1988), 175 Ill. App. 3d 310, 314; Ball Corp., 187 Ill. App. 3d at 177.) It is not enough that the third party will only reap incidental benefits from the contract. (Ball Corp., 187 Ill. App. 3d at 177.) “The test is whether the benefit to the third person is direct to him or is but an incidental benefit to him arising from the contract.” (Wheeling Trust & Savings Bank v. Tremco, Inc. (1987), 153 Ill. App. 3d 136, 140.) A third party is a direct beneficiary when the contracting parties have manifested an intent to confer a benefit upon the third party. Ball Corp., 187 Ill. App. 3d at 177.

With respect to construction contracts, this court has held that “[i]t is not enough that the parties to the contract know, expect or even intend that others will benefit from the construction of the building in that they will be users of it. The contract must be undertaken for the plaintiff’s direct benefit and the contract itself must affirmatively make this intention clear.” Waterford Condominium Association v. Dunbar Corp. (1982), 104 Ill. App. 3d 371, 373.

“Liability to a third party must affirmatively appear from the contract’s language and from the circumstances surrounding the parties at the time of its execution, and cannot be expanded- or enlarged simply because the situation and circumstances justify or demand further or other liability.” Ball Corp. v. Bohlin Building Corp. (1989), 187 Ill. App. 3d 175, 177; see also Midwest Concrete Products Co. v. La Salle National Bank (1981), 94 Ill. App. 3d 394, 397.

“In Illinois, the promisor’s [intent] must be evidenced by an express provision in the contract identifying the third-party beneficiary.” (Wheeling Trust & Savings Bank v. Tremco, Inc. (1987), 153 Ill. App. 3d 136, 140.) Courts require an express provision because “there is a strong presumption that parties to a contract intend that the contract’s provisions apply to only them and not to third parties. In order to overcome that presumption, the implication that the contract applies to third parties must be so strong as to be practically an express declaration.” (Emphasis added.) Ball Corp., 187 Ill. App. 3d at 177.

We find that the trial court properly dismissed plaintiff’s third-party beneficiary claims. Plaintiff, has the burden of proving that defendants intended to confer a direct benefit upon the Association. (Altevogt v. Brinkoetter (1981), 85 Ill. 2d 44, 56.) Plaintiff has failed to meet this burden. The Association has failed to identify any language in the subcontract which constitutes a virtual'express declaration to overcome the presumption that the parties contracted only for themselves. The subcontracts make no reference to the Association or its members, and do not express an intent to directly benefit either the Association or its members. The provisions in the construction contracts regarding guarantees to be provided by the contractor and the subcontractors do not mention the unit owners. There is no question that the parties *** were aware that the building was being built for subsequent purchasers. However, “[i]t is not enough that the parties *** know, expect or even intend that” such people may benefit or that they are referred to in the contract. Waterford Condominium v. Dunbar Corp. (1982), 104 Ill App. 3d 371, 373.

Plaintiff’s reliance upon Gothberg v. Nemerovski (1965), 58 Ill. App. 2d 372, to show that it is a direct and intended beneficiary is inappropriate. In Gothberg, a party with a judgment against an insured for personal injuries sustained in an automobile accident brought a direct suit against the insurance agent who contracted to supply a public liability policy to the insured. The court distinguished automobile insurance policies as having unique “connotations extending to the general public above and beyond the private interests of the two contracting parties” and concluded that “automobile insurance is no longer a private contract merely between two parties.” (Gothberg, 58 Ill. App. 2d at 386.) Furthermore, the insurance policy specifically provided that “[a]ny person *** who has secured such judgment *** shall thereafter be entitled to recover under this policy ***.” Gothberg, 58 Ill. App. 2d at 387.

Plaintiff also misinterprets People ex rel. Resnick v. Curtis & Davis, Architects & Planners, Inc. (1980), 78 Ill. 2d 381. In Resnick, the court required the declaration of intent to be so express that the contracts at issue fully identified the third party. In Resnick, the court held that the State of Illinois was a third-party beneficiary of a construction contract because said contract contained an unequivocally clear provision that the architect-subcontractor must consult with the “ ‘User,’ ” the State of Illinois, as well as the “ ‘Owner’ *** to ‘ascertain the requirements of [the] Project.’ ” (Resnick, 78 Ill. 2d at 386.) The contract also provided that the architect-subcontractor “revise the drawings, specifications and estimate in a manner satisfactory to Owner and User.” (Resnick, 78 Ill. 2d at 386.) In addition, the contracts described the actual method of recovery for the third party. The contract specified that the architect-subcontractor “indemnifies and holds harmless Owner, User.” (Resnick, 78 Ill. 2d at 386.) Resnick is distinguishable from the case at bar because the subcontracts in the instant case do not describe an actual method by which the Association may recover from the subcontractors.

For the aforementioned reasons, we affirm the judgment of the trial court.

Affirmed.

LINN and McMORROW, JJ., concur.


source: Caselaw Access Project

author: JUSTICE McMORROW

license: Public Domain

text:
    CHARLENE PACK, Plaintiff-Appellant, v. SANTE FE PARK ENTERPRISES, INC., et al., Defendants-Appellees.
    First District (4th Division)
    No. 1-89-0737
    Opinion filed February 7, 1991.

      Allan J. Marco, of Marco & Stefanos, of Downers Grove, for appellant.
    Wildman, Harrold, Allen & Dixon, of Chicago (Ruth E. VanDemark and Aaron T. Shepley, of counsel), for appellees.
   JUSTICE McMORROW

delivered the opinion of the court:

Plaintiff Charlene Pack filed suit against the owners of the Santa Fe Raceway (hereinafter collectively referred to as defendants) for injuries she allegedly sustained on the defendants’ premises. Defendants moved for summary judgment on the ground that plaintiff’s suit was barred by the applicable two-year statute of limitations. (Ill. Rev. Stat. 1987, ch. 110, par. 13 — 202.) Plaintiff responded that defendants should be equitably estopped from asserting the statute of limitations defense, because plaintiff had detrimentally relied on the date of injury stated in correspondence from defendants’ insurer to plaintiff’s attorneys. If the incorrect date of injury as stated in the correspondence of defendants’ insurer were adopted, plaintiff’s suit was timely filed. The record establishes, as a matter of law, that defendants are not equitably estopped from raising the statute of limitations as a bar to plaintiff’s suit. Accordingly, we affirm.

The following facts, as revealed in the record, are undisputed for the purpose of defendants’ summary judgment motion. Plaintiff was injured on September 14, 1985, while she was a spectator at an automobile race on defendants’ premises. Plaintiff sustained substantial damage to her face when she was hit by a rock that was thrown loose from the track during a car race.

Plaintiff initially retained Jeffrey M. Goldberg (Goldberg) to represent her in her claim against defendants. Plaintiff submitted all pertinent documents to Goldberg with respect to the injuries she had sustained on defendants’ premises. Goldberg forwarded an attorney lien dated September 20, 1985, to defendants’ insurer, Crawford Risk Management Services (Crawford). In this lien, Goldberg stated that plaintiff was injured on defendants’ premises on September 14, 1985. At some point thereafter, plaintiff forgot, and could no longer remember, the precise date of her injury.

The record indicates that a racing accident report, executed by agents or employees of defendants, stated that the date of plaintiff’s accident was September 14, 1985. In addition, the report of the ambulance service that transported plaintiff from defendants’ premises to a local hospital after she was injured indicated that the ambulance service was provided on September 14, 1985. The record does not reveal whether these documents were obtained by Goldberg during his representation of plaintiff. However, defendants do not dispute that these documents were in Crawford’s possession prior to plaintiff’s institution of her suit against defendants.

Goldberg terminated his representation of plaintiff in the summer of 1987, and plaintiff retained Allan J. Marco (Marco) to act on her behalf in June 1987. In the few months in which Marco represented plaintiff before suit was filed, Marco corresponded with Goldberg and Crawford to obtain the pertinent documents held in the possession of these parties. In response to Marco’s request, Goldberg sent Marco four letters which Goldberg had received from Crawford. Each of these letters included a caption indicating that plaintiff’s date of injury was September 19, 1985. Marco also sent a notice of attorney lien to Crawford stating that plaintiff had been injured on September 19, 1985. At Crawford’s direction, Marco obtained a release of attorney lien from Goldberg and forwarded it to Crawford. Marco also hired a private investigator in order to ascertain the proper names in which defendants should be specified in a complaint against them.

According to the record, all correspondence Marco received from Goldberg or Crawford included a caption indicating that plaintiff’s date of injury was September 19, 1985. In addition, none of the documents received by Marco indicated that plaintiff’s injuries occurred on a date other than September 19, 1985. As it appears in the record, neither Goldberg nor Crawford provided Marco with a copy of Goldberg’s original attorney lien, the defendants’ racing accident report, or the report of the ambulance service, all of which accurately stated plaintiff’s date of injury as September 14, 1985. The record does not disclose whether Marco specifically requested these documents from Goldberg, Crawford, or any other person or entity. Because all correspondence and documents in his possession appeared to consistently state the date of plaintiff’s injuries as September 19, 1985, Marco drafted a complaint in early September 1987 that alleged plaintiff had been injured on that date. Plaintiff’s complaint was filed on September 15,1987.

Defendants answered the complaint and filed the affirmative defense that plaintiff’s suit was barred by the applicable two-year statute of limitations, since her injuries occurred on September 14, 1985, and suit was not filed until two years and a day thereafter, on September 15, 1987. (Ill. Rev. Stat. 1987, ch. 110, par. 13 — 202.) Thereafter, defendants filed a motion for summary judgment based upon this affirmative defense. Following briefing and argument, the trial court allowed defendants’ motion for summary judgment. The trial court determined that plaintiff had unreasonably relied on the correspondence from Crawford in order to ascertain the precise date of plaintiff’s injuries. Plaintiff’s timely appeal followed.

On appeal, plaintiff argues that the record presents a triable issue of fact with respect to whether defendants should be equitably estopped from raising the defense that her suit was barred by the two-year statute of limitations. (Ill. Rev. Stat. 1987, ch. 110, par. 13— 202.) Plaintiff emphasizes that defendants’ insurer repeatedly misstated, in its correspondence to Goldberg and Marco, that plaintiff’s date of injury was September 19, 1985. Plaintiff also observes that the defendants’ insurer received correspondence from Goldberg and Marco, but never corrected these attorneys’ misapprehension that plaintiff had been injured on September 19, 1985. Plaintiff contends that defendants should not be permitted to benefit from their failure to accurately state the date of plaintiff’s injury in its correspondence to plaintiff’s attorneys, especially since her complaint was filed only one day after the statute of limitations had expired.

A defendant is equitably estopped from raising a statute of limitations defense when the defendant undertook affirmative acts that lulled the plaintiff into a false sense of security that the limitations defense would not be raised. Equitable estoppel is generally a question of fact, and the question is properly decided as a matter of law only when the facts are undisputed and reasonable persons could not differ as to the inferences to be drawn from the facts presented. See, e.g., Pantle v. Industrial Comm’n (1975), 61 Ill. 2d 365, 335 N.E.2d 491.

The six elements of equitable estoppel are: (1) defendant undertook words or conduct that amounted to a misrepresentation or concealment of material fact; (2) defendant knew, or had reason to know, the falsity of his misrepresentation or concealment; (3) plaintiff did not know, or have reason to know, that defendant’s misrepresentation or concealment was false; (4) defendant intended, or reasonably expected, that plaintiff would detrimentally rely on defendant’s misrepresentation or concealment; (5) plaintiff’s detrimental reliance was reasonable and in good faith; and (6) plaintiff would be prejudiced if defendant were permitted to avoid the falsity of his misrepresentation or concealment. Vaughn v. Speaker (1988), 126 Ill. 2d 150, 162, 533 N.E.2d 885.

Applying these elements to the case at bar, we conclude that the record reveals no disputed factual issues with respect to whether defendants should be equitably estopped from raising the affirmative defense that plaintiff’s suit was tardily filed because her injuries occurred on September 14, 1985, rather than on September 19, 1985. Considering all the circumstances pertaining to the interactions of Marco, Goldberg, and Crawford, we find that the record establishes, as a matter of law, that Crawford did not lull plaintiff and her attorney into a false sense of security that defendants would not contest the precise date of plaintiff’s injuries. The record shows that plaintiff had reason to know that the date stated in Crawford’s correspondence was inaccurate and that her reliance on Crawford’s letters to determine the precise date of her injury was unreasonable.

It has been stated that “ ‘[a] party claiming the benefit of an estoppel cannot shut his eyes to obvious facts, or neglect to seek information that is easily accessible, and then charge his ignorance to others.’ ” (Vaughn, 126 Ill. 2d at 169 (Ryan, J., specially concurring), quoting Vail v. Northwestern Mutual Life Insurance Co. (1901), 192 Ill. 567, 570.) Thus, to benefit from equitable estoppel, the plaintiff must have “had no knowledge or means of knowing the true facts. [Citations.]” (Lissner v. Michael Reese Hospital & Medical Center (1989), 182 Ill. App. 3d 196, 207, 537 N.E.2d 1002.) The record here reveals that plaintiff had ample means of ascertaining the precise date of her injury, without regard to the date of injury stated in correspondence from defendants’ insurer, Crawford.

It is undisputed that plaintiff originally knew, and for a time recalled, the precise date of her injury. The record demonstrates that plaintiff’s initial attorney, Goldberg, had been properly advised of the date of her injury and stated the correct date in his notice of attorney lien to Crawford. Thus, the precise and accurate date of plaintiff’s injuries could have been discovered and corrected had plaintiff’s original counsel, Goldberg, reviewed his file documents and realized that the date stated in correspondence from Crawford was incorrect. There is nothing in the record to suggest that Crawford impeded Goldberg from ascertaining the accurate date of plaintiff’s injuries, or that Crawford interfered with Goldberg’s transmission of this information to Marco. In addition, there is nothing in the record to indicate that Crawford prevented or interfered with any effort that may have been undertaken by either Goldberg or Marco to obtain the ambulance report, which correctly stated plaintiff’s date of injury.

Given these circumstances, we cannot conclude that Crawford should be equitably estopped from raising the statute of limitations defense to plaintiff’s claim, on the theory that Crawford should have corrected the misperception of her counsel with respect to the precise date of her injury. This misperception by plaintiff’s attorneys could have been readily corrected had the attorneys properly obtained and reviewed the pertinent documents, and if counsel had adequately communicated with respect to the facts pertaining to the plaintiff’s claim against defendants. In our view, Crawford should not be held accountable, under the doctrine of equitable estoppel, for the failure of plaintiff’s attorneys to timely, properly, and accurately determine the factual predicate to their client’s case before suit was filed.

In light of these considerations, we hold that the trial court properly entered summary judgment in defendants’ favor on the grounds that the statute of limitations had expired and that defendants were not equitably estopped from raising the limitations as a defense to plaintiff’s suit. See, e.g., McCammant v. McCarthy (1990), 202 Ill. App. 3d 812, 560 N.E.2d 432 (defendant died before plaintiff filed suit; no showing that defendant’s insurer knew of or knowingly concealed this fact from plaintiff prior to expiration of statute of limitations); Neaterour v. Holt (1989), 188 Ill. App. 3d 741, 749-50, 544 N.E.2d 846 (plaintiff could not invoke equitable estoppel when plaintiff had accessible means of learning, before statute of limitations expired, that defendant had been negligent in treatment of plaintiff).

Plaintiff also argues that summary judgment should not have been entered because the trial court had previously denied defendants’ motion to dismiss plaintiff’s complaint, under section 2 — 619 of the Illinois Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 619), in which defendants argued that plaintiff’s complaint was time barred.

The record shows that defendants’ section 2 — 619 motion to dismiss was denied by Judge Sodaro, while the defendants’ motion for summary judgment was allowed by Judge Hoffman. Plaintiff contends that in denying defendants’ motion to dismiss, Judge Sodaro ordered that defendants obtain the deposition testimony of plaintiff’s present attorney, Marco, and that defendants then file a motion for summary judgment with respect to defendants’ affirmative defense that the statute of limitations had expired. Plaintiff argues that because defendants did not obtain Marco’s deposition testimony,. Judge Hoffman, who heard defendants’ summary judgment motion because of an automatic assignment of the case to him, should have denied the defendants’ summary judgment motion. Plaintiff asserts that Judge Hoffman’s allowance of defendants’ summary judgment motion amounted to an impermissible modification of Judge Sodaro’s denial of defendants’ section 2 — 619 motion to dismiss.

The transcript, of the trial court’s oral pronouncements indicates that, when Judge Sodaro denied defendants’ section 2 — 619 motion to dismiss, he suggested, but did not require, that defendants obtain Marco’s deposition testimony. Judge Sodaro also offered that defendants’ statute of limitations argument might be more appropriately raised in a motion for summary judgment rather than a section 2— 619 motion to dismiss. As a result, the record does not support plaintiff’s argument that. Judge Sodaro ordered defendants’ taking of Marco’s deposition testimony as a precondition to defendants’ filing of a summary judgment motion.

In addition, even assuming arguendo that Judge Hoffman’s consideration of defendants’ summary judgment motion amounted to a modification of Judge Sodaro’s prior denial of defendants’ section 2— 619 motion to dismiss, such modification would not be ground for reversal. The denial of a section 2 — 619 motion to dismiss is an interlocutory order, and it is not improper for a trial judge to amend, revise, or reverse the prior interlocutory order of another trial judge. (Rowe v. State Bank of Lombard (1988), 125 Ill. 2d 203, 213, 531 N.E.2d 1358; Catlett v. Novak (1987), 116 Ill. 2d 63, 68, 506 N.E.2d 586; In re Marriage of Wilson (1990), 193 Ill. App. 3d 473, 477, 549 N.E.2d 1348.) In addition, there is nothing in the record to indicate that defendants acted in bad faith when they filed their motion for summary judgment, or that defendants were “judge shopping” in order to avoid the previous denial of their section 2 — 619 motion to dismiss. (See Rowe, 125 Ill. 2d at 214.) Consequently, we find plaintiff’s argument insufficient ground to disturb the trial court’s entry of summary judgment in favor of defendants.

For the reasons stated, the judgment of the circuit court of Cook County is affirmed.

Affirmed.

JIGANTI, P.J., and LINN, J., concur.


author: JUSTICE COCCIA

text:
    CHRIST DEMOS, Plaintiff-Appellant and Cross-Appellee, v. NATIONAL BANK OF GREECE, Defendant-Appellee and Cross-Appellant. — CHRIST DEMOS et al., Plaintiffs-Appellants, v. NATIONAL BANK OF GREECE, Defendant-Appellee.
    First District (5th Division)
    Nos. 1-88-2509, 1-89-1256 cons.
    Opinion filed February 8, 1991.

      Daniel C. Meenan, Jr., and Georgia A. Kolettis, both of Feiwell, Galper & Lasky, Ltd., of Chicago, for appellants.
    Arvey, Hodes, Costello & Burman and Bishop, Callas & Wagner, both of Chicago (Lawrence C. Rubin and Frank R Tighe III, of counsel), for appellee.
   JUSTICE COCCIA

delivered the opinion of the court:

These consolidated appeals arise from various disputes between the National Bank of Greece, S.A., on the one hand, and Christ Demos and Louis Demos, on the other hand. In case number 1 — 88— 2509, the Demoses appeal from the circuit court’s entry of summary judgment in favor of the bank on their claim that it breached an oral agreement to loan them money. In case number 1 — 89—1256, Christ Demos appeals from the circuit court’s award of attorney fees and costs in favor of the bank in an action it brought to enforce his obligations under a promissory note and a guaranty; the bank has cross-appealed regarding the award of fees. The bank also joined in 1 — 89— 1256, after the circuit court granted Christ Demos’ petition to reopen the judgment concerning the guaranty. We shall discuss these appeals separately.

No. 1-88-2509

The Demoses filed their third amended complaint at law on October 13, 1985, naming the bank as defendant. The Demoses alleged, generally, that they were engaged in the business of owning and operating restaurants in the Chicago area and that the bank was a foreign banking association with a branch operation located in Chicago. They became customers of the bank in 1977, at the request of its branch manager, George Kostis, and transferred all of their banking business to it. In September of 1979, the Demoses further alleged, Kostis represented that the bank would loan them $800,000 in two installments, to be funded at their request. The first installment, in the amount of $200,000, was to be used in constructing a restaurant in Chicago. The loan was to be made at the “prevailing” interest rate at the time the Demoses requested the proceeds, they alleged. By letter dated September 5, 1985, Kostis confirmed that the bank would loan them $200,000 at 12% interest. The Demoses received the loan proceeds two months later. In November of 1979, Charalombys Zarakiotis replaced Kostis as branch manager. According to the Demoses, both Kostis and Zarakiotis represented that the second installment would be forthcoming. The second installment (also intended for constructing a restaurant) was not forthcoming, however, notwithstanding the demands of the Demoses. By May of 1981, the Demoses alleged, they could no longer afford to delay and obtained substitute financing from the Wheeling Trust & Savings Bank.

In count I of their third amended complaint, sounding in breach of contract, the Demoses went on to allege that Wheeling was able to extract from them loan terms more costly (including a higher interest rate) than those prevailing at the time they received the assurances from the bank. As a result, they were required to pay an additional $75,000 in interest to Wheeling. Count II sounded in estoppel. The Demoses alleged that they relied to their detriment on the bank’s oral loan commitment. In addition, they claimed, they were damaged because the bank’s misrepresentations induced them to delay from going elsewhere for the loan. The Demoses also claimed that they were damaged by the bank’s unreasonable conduct in refusing to grant Wheeling a subordinate position in collateral, which required them to borrow a larger amount from Wheeling in order to pay in full their loan obligations to the bank so that it would release their collateral to Wheeling, thereby securing the latter’s loan to them.

After the bank answered the third amended complaint, it moved for summary judgment pursuant to section 2 — 1005 of the Illinois Code of Civil Procedure. (See Ill. Rev. Stat. 1987, ch. 110, par. 2— 1005.) The bank also submitted a memorandum in support of its motion, along with several exhibits. The bank’s principal argument was that, as a matter of law, no enforceable contract to lend $600,000 was ever formed. A copy of the bank’s commitment letter regarding the $200,000 was attached as an exhibit. This letter makes no mention of the alleged second installment of $600,000. The bank also relied on the discovery deposition testimony of Christ Demos. According to the bank, his testimony disclosed that no agreement was ever reached concerning the interest which was to be charged on the $600,000. At various points in his testimony, Christ stated the interest rate would be negotiated, would be fair, would be prime rate, would be “one over prime,” or that Kostis would be free to set the interest rate. Christ also testified that when Kostis issued the commitment letter regarding the $200,000, he asked the bank for a written commitment regarding the $600,000. But Christ stated that Kostis would not give him a written commitment, because the second installment was “too far away.”

In response to the bank’s motion for summary judgment, the Demoses submitted, among other things, the affidavit of Christ Demos. Christ affirmed that in September of 1979, the bank through Kostis made an oral commitment to loan them $800,000, to be paid in two installments of $200,000 and $600,000. Christ went on to affirm:

“The agreed rate of interest on the loan was to be the prime rate at the time I requested the proceeds. I requested both installments, the first in approximately September, 1979, and the second, shortly thereafter. The prime rate in September, 1979 was approximately 12%. Since I demanded that the $600,000.00 installment be funded in late 1979, it is my contention that the interest rate on the second installment should also have been 12% [the prime rate at the time].”

The bank then moved to strike Christ’s affidavit, contending that it contradicted his prior, sworn deposition testimony. On August 10, 1988, the circuit court granted the bank’s motion for summary judgment and entered judgment in its favor on both counts of the third amended complaint. Subsequently, the Demoses appealed.

In this court, the Demoses argue that the circuit court erred in entering summary judgment against them on their breach of contract and promissory estoppel claims. The bank responds that the circuit court did not abuse its discretion in entering summary judgment. It is the bank’s principal theory on review, as below, that the alleged oral agreement is unenforceable because of its indefiniteness.

Before turning to the merits of the case, we must consider the appropriate standard of review. The bank cites Lindenmier v. City of Rockford (1987), 156 Ill. App. 3d 76, 508 N.E.2d 1201, Neumann v. Gloria Marshall Figure Salon (1986), 149 Ill. App. 3d 824, 500 N.E.2d 1011, Kemp v. Sisters of the Third Order of St. Francis (1986), 143 Ill. App. 3d 360, 493 N.E.2d 372, and Fear on v. Mobil Joliet Refining Corp. (1984), 131 Ill. App. 3d 1, 475 N.E.2d 549, in support of its assertion that we should apply the abuse of discretion standard. Fearon, however, was an appeal from unsuccessful motions to vacate summary judgments, filed more than one year after those judgments were entered. In such cases, where the losing party seeks to vacate a judgment long after its entry, the abuse of discretion standard is proper. But when an appellate court is faced with an appeal involving only the propriety of summary judgment, the de novo standard of review should be applied — the appellate court, like the trial court, determines whether there is a genuine issue of material fact. (See generally Smith and Simko, Principles of Appellate Review: A Lack of Consensus in Illinois Courts, 3 Appellate Law Review 62, 73-74 (1990); see also R. Michael, 4 Illinois Practice: Civil Procedure Before Trial §38.5, at 233 (1989) (usual deference reviewing court grants order of trial court is not applicable to order granting summary judgment, to ensure that nonmovant’s right to trial by jury has not been unjustly lost).) Therefore, we must respectfully disagree with those courts that have applied the abuse of discretion standard in reviewing summary judgment orders.

While we reject the bank’s argument regarding the proper standard of review, we agree that Christ Demos cannot be allowed to contradict his prior, sworn deposition testimony via an affidavit. In Commonwealth Eastern Mortgage Co. v. Williams (1987), 163 Ill. App. 3d 103, 516 N.E.2d 515, appellant filed an affidavit after appellee moved for summary judgment, in an attempt to supply terms for an alleged oral agreement which he was unable to supply at his discovery deposition. The appellate court stated that it would not consider the affidavit in reviewing the entry of summary judgment against him. The court relied on the rule that a nonmovant cannot use an affidavit to contradict prior deposition testimony and place material facts in issue. The reviewing court identified the judicial policy behind the rule: once parties have given sworn testimony, they should not be encouraged to commit perjury by changing their prior testimony so as to avoid its consequences. (See Williams, 163 Ill. App. 3d at 108-10, 516 N.E.2d at 518-19.) Following Williams, we shall not consider Christ’s affidavit in reviewing the circuit court’s entry of summary judgment against the Demoses.

We now turn to the merits of the summary judgment order. McErlean v. Union National Bank (1980), 90 Ill. App. 3d 1141, 414 N.E.2d 128, is a leading Illinois case regarding the enforceability of oral agreements to lend money. Plaintiff in McErlean appealed from, among other things, the circuit court’s dismissal of his claim against defendant bank for breach of an oral contract to extend a line of credit up to $100,000. The appellate court affirmed, concluding that the amended complaint failed to allege a loan commitment sufficiently definite to constitute an enforceable agreement. Plaintiff neither pleaded the existence of a document purporting to be a contract to lend him $100,000, nor did he attach such a document to his amended complaint. And he failed to plead the essential terms of a contract to lend money in the future. The reviewing court defined those terms as follows:

“These terms would include, for example, the intended duration of the line of credit; the applicable rate of interest to be charged for any loan emanating from such an agreement, or the basis for how such interest would be ascertained; what duration or date or dates were contemplated for maturity of such loans; and what mode or rate of repayment was contemplated, i.e., whether the entire amount would be repayable or if repayment in installments would be acceptable. [Citation.]” (McErlean, 90 Ill. App. 3d at 1146, 414 N.E.2d at 132.)

After reviewing the relevant authorities, the court concluded that the specification of the interest rate to be charged is a significant element, if not the sine qua non, of a contract to loan money. Because plaintiff expressly pleaded no allegations (and none could be implied) as to interest, duration, and terms of repayment, the court found no error in the dismissal of the amended complaint insofar as it purported to plead an oral, or partially written and partially oral, contract to loan money in the future. See McErlean, 90 Ill. App. 3d at 1146-47, 414 N.E.2d at 132-33; see also Champaign National Bank v. Landers Seed Co. (1988), 165 Ill. App. 3d 1090, 519 N.E.2d 957 (oral contract to lend money in future cannot exist as matter of law where no cost of money terms are included in alleged agreement).

In light of McErlean, the bank was entitled to summary judgment on count I of the third amended complaint. The principal infirmity regarding the alleged $600,000 installment — although it is by no means the sole infirmity — is the indefiniteness of the interest rate. The Demoses claimed in their third amended complaint that the bank orally agreed to charge them the “prevailing” rate. In his discovery deposition, Christ Demos could not specify whether the interest rate would be negotiable, “fair,” prime, 1% over prime, or whether the bank would be free to set the rate. This indefiniteness, regarding an essential element of an oral contract to lend money in the future, renders it unenforceable as a matter of law. The Demoses rely on Wait v. First Midwest Bank/Danville (1986), 142 Ill. App. 3d 703, 491 N.E.2d 795, and Carrico v. Delp (1986), 141 Ill. App. 3d 684, 490 N.E.2d 972, to support their claim that the contract was not indefinite. In Wait, however, plaintiff’s amended complaint included specific allegations as to how the interest rate was to be computed; in Carrico, similarly, it was clear that the bank was to set the interest rate. Yet in our case the Demoses themselves are unclear about who would set the rate or what standard would be used in determining it.

Because the alleged oral contract is so indefinite as to be unenforceable, the doctrine of promissory estoppel, which the Demoses invoked in count II of their third amended complaint, is inapplicable as a matter of law. Before the doctrine applies, there must be a promise. (See First National Bank v. Sylvester (1990), 196 Ill. App. 3d 902, 911, 554 N.E.2d 1063, 1070.) Moreover, the doctrine does not apply where the reliance of the parties who seek to invoke it was not reasonable or justifiable. (See S.N. Nielsen Co. v. National Heat & Power Co. (1975), 32 Ill. App. 3d 941, 944, 337 N.E.2d 387, 389.) In this case, reliance on the bank by the Demoses was neither reasonable nor justifiable. Their $200,000 transaction with the bank was reduced to writing by commitment letter and promissory note. Furthermore, Christ Demos himself testified that even though he requested a written commitment regarding the $600,000 — as he received for the smaller amount of $200,000 — the bank refused to acquiesce. Given these facts, to the extent that the Demoses may have relied on the bank, their reliance was unreasonable and unjustifiable as a matter of law.

Consequently, we are of the opinion that the circuit court did not err in entering summary judgment in favor of the bank on counts I and II of the third amended complaint.

No. 1-89-1256

Louis Demos is not involved in this appeal, in which Christ Demos requests that we review an allegedly excessive award of attorney fees and costs to the bank. The bank obtained the award after successfully prosecuting its action to enforce Christ's obligations under his promissory note, as well as a guaranty of a second promissory note. The bank has cross-appealed, claiming that the fee award was insufficient. Subsequently, the bank joined in this appeal, after the circuit court granted Christ’s petition to vacate that portion of the judgment regarding the guaranty.

This case began when the bank filed a complaint in the municipal department of the circuit court on March 22, 1982. The bank alleged that George and Vasiliki Petropoulos made and delivered a promissory note on March 15, 1979. That same day, the bank further alleged, Christ Demos executed a separate, unlimited personal guaranty in favor of the bank. The makers defaulted in their payments on the note, and the bank demanded that Christ remit the unpaid balance. Despite these demands, Christ refused to pay. Accordingly, the bank requested judgment in the amount of $9,769 in principal and interest, along with attorney fees and costs.

Christ answered the bank’s complaint on April 20, 1982, denying that he was obligated to it. He also raised several affirmative defenses. In his fourth affirmative defense, Christ alleged that even if he was obligated under the guaranty, any amounts owed by him to the bank were offset by amounts which were the subject of his cause of action in the oral loan commitment case, which we discussed above and which he filed in the law division on March 31,1982.

Subsequently, the bank filed an amended complaint, alleging that Christ made and delivered his own promissory note on January 11, 1982, in the sum of $22,000. The bank further alleged that the note matured on April 12, 1982, and that Christ refused to pay any part of it. Consequently, the bank prayed for $23,691.55 in principal and interest, along with attorney fees and costs.

Christ answered the bank’s amended complaint on October 26, 1982, denying that any money was due on the subject note. Again, as an affirmative defense, he alleged that the bank was not entitled to recover any money from him on the note because it owed him substantially in excess of that amount as a result of their prior business relationship, as was more fully alleged in his law division case based on the alleged oral loan commitment.

The law and municipal cases were subsequently consolidated in the law division. The bank — having obtained summary judgment against the Demoses on counts I and II of their third amended complaint on August 2, 1988 — moved for summary judgment regarding its claim on September 12, 1988. Because Christ raised his claim against the bank as a defense to its claim, and because it subsequently prevailed on his claim, the bank argued that it was entitled to judgment as a matter of law. In its supporting memorandum, the bank prayed for judgment in the amount of $106,414.63. Among other things, the bank requested $50,000 in attorney fees and expenses, including the fees it incurred in defending the oral loan commitment case filed by the Demoses.

On December 12, 1988, the circuit court entered judgment in the bank’s favor for the unpaid principal balance on the note and guaranty in the amount of $29,533.67. The court continued the hearing on the issues regarding interest and attorney fees. On January 17, 1989, the circuit court entered an order confirming the award of $29,533.67 to the bank. The court further ordered that judgment be entered in the amount of $26,860.96 for interest on the note and guaranty. The court denied the bank’s motion for attorney fees in connection with its defense of the oral loan commitment claim, but granted the bank leave to file an amended petition for attorney fees. The next day the bank filed its supplemental petition for attorney fees. The bank requested $9,257.50 in fees and $223.20 in costs for prosecution of both its claim on Christ’s note as well as its claim on the note he guaranteed.

On April 12, 1989, following a hearing, the circuit court awarded the bank $6,612.50 in attorney fees and $223.20 in costs. The order does not distinguish between the fees and costs awarded regarding Christ’s own note, on the one hand, and the note he guaranteed, on the other hand. Christ filed his notice of appeal on May 11, 1989; the bank filed its notice of cross-appeal on May 12, 1989.

On September 8, 1989, Christ filed his section 2 — 1401 petition to partially open judgment. (See Ill. Rev. Stat. 1987, ch. 110, par. 2— 1401.) This petition concerned only the guaranty he executed on behalf of the makers of the $10,000 promissory note, the Petropouloses. Christ alleged that on the date of judgment, the balance due on the guaranty was $10,804.86 ($7,533.67 in principal and $3,271.19 in interest). He further alleged that the bank, in an affidavit submitted along with its motion for summary judgment (executed by its co-manager Vasilios Skouras), failed to disclose that it had settled with Vasiliki Petropoulos. In addition, he went on to allege that the bank falsely stated in the affidavit that its previous judgment against the makers, which it obtained on May 26, 1981, remained unsatisfied. Attached to Christ’s petition was a copy of a letter from the bank’s attorney (George Marinakis) to the attorney for Vasiliki Petropoulos, dated March 14, 1983 (“settlement letter”), stating that it would settle the indebtedness and agree not to sue her if- she paid $1,000 in installments of $50 per month commencing April 1, 1983. As evidenced by the bank’s ledger sheets, which it submitted in support of its motion for summary judgment, $1,000 was paid to it at $50 per month commencing April 8, 1983, and concluding with a final payment of $100 on October 2, 1984. However, the ledger sheets did not reflect that these payments were made pursuant to a settlement. Because his rights of subrogation were prejudiced by this settlement, Christ claimed that he was entitled to be discharged from liability as guarantor. On account of the bank’s erroneous affidavit and its failure to disclose the settlement at the time of entry of judgment on January 17, 1989, these facts were unknown to Christ, he alleged. Christ averred that he did not discover these facts until he paid the judgment and then sued Vasiliki Petropoulos to recover the $10,804.86 he paid on her behalf: on August 22, 1989, her attorney presented a motion to dismiss his suit, on the basis of the settlement with the bank; in support of her motion, a copy of the bank’s settlement letter was attached. Accordingly, Christ prayed that the portion of the judgment concerning the guaranty be opened up and set aside, so that he could assert a defense which would have prevented rendition of that portion of the judgment.

On November 28, 1989, the bank moved to dismiss Christ’s petition for post-judgment relief, pursuant to section 2 — 615 of the Illinois Code of Civil Procedure. (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 615.) The bank argued that his petition was insufficient as a matter of law, for he had not submitted an affidavit in support of the petition showing that he did not know of the settlement letter when judgment was entered, the settlement letter created no defense, and he had not exercised diligence. In reply to the bank’s motion Christ argued that he did have a defense. He also submitted an affidavit, affirming that he had no knowledge of either the settlement or the letter memorializing it until August of 1989, when his current counsel showed him the settlement letter. And Christ submitted the affidavit of Daniel J. Meehan, Jr., who defended him in the bank’s action on the note and guaranty. Meehan affirmed that the bank never disclosed the settlement letter to him, and that he had no knowledge of it until the attorney representing Christ in the section 2 — 1401 action gave him a copy.

On January 8, 1990, the circuit court denied the bank’s motion and directed it to answer Christ’s petition. The bank answered the petition on March 13, 1990. The bank denied, among other things, that the Skouras affidavit was false, and it asserted that — even if it had known of the settlement letter — it was not under an affirmative obligation to disclose the letter to Christ absent a specific discovery request. The bank submitted four affidavits along with its answer. Frank P. Tighe III, who represented the bank in its action against Christ and defended it in the loan commitment action of the Demoses, affirmed that he had no knowledge of the settlement letter until reading Christ’s petition for post-judgment relief. Lawrence C. Rubin, who also represented the bank in its action and defended it in the loan commitment action, affirmed that he had no knowledge of the settlement letter until reading the section 2 — 1401 petition. Attorney Perry G. Callas affirmed that he represented the bank in its action against Christ on the guaranty; Marinakis represented the bank in its action against the Petropouloses, and he obtained a judgment against them on May 26, 1981; Callas filed the guaranty action against Christ on March 22, 1982; Callas responded to Meehan’s interrogatories and production requests in that action, but neither Marinakis nor the bank informed him of settlement negotiations or Marinakis’ settlement letter; at the depositions of the bank’s officers, including Skouras, Christ’s attorneys did not inquire about the settlement and they propounded no additional or supplemental discovery; and, finally, Callas affirmed, he had no knowledge of the settlement letter until reading Christ’s section 2 — 1401 petition. In his affidavit, Skouras affirmed that no one at the Chicago branch informed him of the settlement, that he had no knowledge of the settlement when he executed his earlier affidavit, and that he never discussed the Petropoulos loan with Marinakis.

On March 14, 1990, the circuit court entered an order stating that the summary judgment regarding Christ’s guaranty was vacated and set aside, including the award of attorney fees to the bank applicable thereto. The court returned the case to the trial call for trial on the guaranty. In addition, sua sponte, the court directed that a hearing would be set to determine whether sanctions should be imposed on the bank for withholding the settlement letter. On March 30, 1990, the bank filed its notice of appeal (see 107 Ill. 2d R. 304(b)(3)), and it sought to join in Christ’s appeal number 1 — 89—1256, which arose from the same case. On April 18, 1990, the circuit court granted the bank’s motion to stay the proceedings pending appeal, on condition that it post a $15,000 appeal bond. After oral argument in appeal number 1 — 88—2509, we consolidated it with appeal number 1 — 89— 1256.

Because resolution of the attorney fees issue depends on resolution of the section 2 — 1401 issue, we shall consider the latter issue first. This court has noted that a section 2 — 1401 petition invokes the equitable power of the trial court, when the exercise of such power is necessary to prevent injustice. (See Leavens, Armiros & Ross, Ltd. v. English (1990), 203 Ill. App. 3d 16, 19, 560 N.E.2d 1031, 1034.) Two elements must be alleged in such a petition: first, the .petitioner must have a meritorious defense; second, the entry of judgment must not have been the result of the petitioner’s lack of diligence. The decision to vacate rests within the sound discretion of the circuit court and will not be reversed on review unless that court abused its discretion. See Leavens, Armiros & Ross, 203 Ill. App. 3d at 20, 560 N.E.2d at 1034.

Taking the second element first, we cannot say that the circuit court abused its discretion in ruling that Christ exercised due diligence. Although the bank denies concealing the settlement letter, we need not go so far as to hold that it concealed the letter in order to affirm the circuit court. But it is clear that the discovery propounded by Christ was drafted broadly enough to call for production of the letter. We agree with Christ that if, as the bank professes in the four affidavits it submitted (executed by one of its officers and three of its attorneys from two different law firms), it was ignorant of the settlement letter, how can he be charged with a lack of diligence in failing to discover the letter before the entry of judgment against him on the guaranty? In addition, the consequences of accepting the bank’s argument — that, notwithstanding Christ’s interrogatories and production request, it was under no affirmative duty to produce the letter even if it knew of its existence — would be intolerable, for they would have the effect of encouraging parties to conceal evidence during discovery.

Similarly, we cannot say that the circuit court abused its discretion in ruling that Christ had a meritorious defense to the bank’s claim on the guaranty. In this court, as below, he relies on Trotter v. Strong (1872), 63 Ill. 272. In that case, Trotter was given a promissory note by Graves and Roberts, the principal debtors, with Strong and Chappell acting as sureties. Subsequently, Trotter entered into an agreement with Roberts, providing that if Roberts gave him $500, he would never collect any further portion of the $2,039.58 judgment on the note from him. Strong was not given notice of this agreement, and he neither consented to nor ratified it. In the litigation which followed, Strong’s theory was that he was released from further liability. Trotter, although he admitted the existence of the agreement not to enforce the judgment with Roberts, denied that he had released the others. The circuit court ruled for Strong, and Trotter appealed. The supreme court of Illinois affirmed, reasoning:

“When a creditor receives part of the claim from the principal debtor, under such circumstances as would constitute a satisfaction of his liability, the surety must be discharged. In such a case, the debt is satisfied, and the surety can not [sic] be liable for the payment of a debt that is discharged. If he were held liable, he could not recover over against the principal, because he is discharged from the debt and owes the creditor nothing, and the surety could not recover for money paid to the use of the principal, as he owes nothing, and when the surety makes the payment it can not [sic] be for the use of the principal debtor. To enforce payment from the surety under such circumstances, would be to deprive him of his legal right to be reimbursed for the money thus paid. It would change the relations of principal and surety, deprive the latter of a legal right, and would operate unjustly. When the creditor, therefore, without the assent of the surety, discharges the principal debtor, it must follow that the surety can no longer be held liable. His liability can not [sic] survive that of his principal, unless it be by his own agreement.” (Trotter, 63 Ill. at 274.)

The parties agree that Trotter is still the law in this State.

The bank, however, relies on Pate v. City of Sesser (1979), 75 Ill. App. 3d 233, 393 N.E.2d 1146, to support its contention that Christ has not established a meritorious defense. The appellate court in Pate stated that a release extinguishes a cause of action, but a covenant not to sue affects only the right to bring suit and not the cause of action itself. (See Pate, 175 Ill. App. 3d at 236-37, 393 N.E.2d at 1149.) The bank concludes that because the settlement letter was a covenant not to sue rather than a release, Christ’s liability was not discharged by it. Yet it must be remembered that framing the analysis in terms of whether an instrument is a release or a covenant not to sue can distort the real issue, which is to determine the intent of the parties to the agreement. (See Brady v. Prairie Material Sales, Inc. (1989), 190 Ill. App. 3d 571, 575, 546 N.E.2d 802, 804.) We think Christ has made a sufficient showing, for the purposes of a section 2 — 1401 petition, that he has a meritorious defense to the guaranty claim. That is, in the language of Trotter, Christ has demonstrated that it would be unjust for the bank not to discharge him as surety, when it intended to discharge Vasiliki Petropoulos as a principal debtor. Equity requires that he be given the opportunity to litigate this defense on remand, as he would have if the bank had disclosed the settlement letter during discovery.

Finally, we come to the matter of the attorney fees awarded by the circuit court. We have reviewed the record, including pleadings, the transcripts of the hearings held below, and the orders appealed from. These materials do not reveal what portion of the award is attributable to Christ’s own promissory note, on the one hand, and the note he guaranteed, on the other hand. Therefore, given the state of the record, we cannot determine whether the bank was awarded too much or too little on Christ’s promissory note.' We have affirmed the circuit court’s finding that the bank is not entitled to fees regarding the guaranty; consequently, we must remand the cause for a hearing on the question of what fees the bank is entitled to regarding Christ’s note. Still remaining, however, is the issue of whether the bank was entitled to fees for its defense of the loan commitment case of the Demoses, which Christ raised as an affirmative defense in its action against him on the note.

The bank cites Williams v. Federal Deposit Insurance Corp. (1987), 155 Ill. App. 3d 633, 508 N.E.2d 337, to bolster its contention that it is entitled to attorney fees for its defense of the loan commitment case. Plaintiff in Williams filed a claim against the FDIC, as receiver of a bank, to collect compensation for certain services he rendered to the bank pursuant to an oral contract. The FDIC counterclaimed, contending that plaintiff was indebted to the bank pursuant to a promissory note. The circuit court granted summary judgment in the FDIC’s favor on plaintiff’s claim and the counterclaim and awarded the FDIC attorney fees. Plaintiff appealed, and the appellate court affirmed. That court, reviewing the facts of the case before it, noted that plaintiff executed a promissory note with the bank for the purpose of restructuring his personal loans. After the oral agreement was allegedly breached, plaintiff filed an action in chancery against the bank, asserting causes of action sounding in breach of oral contract, fraudulent misrepresentation, quantum meruit, and injunctive relief. The bank counterclaimed to recover the principal amount of the promissory note, as well as reasonable attorney fees. Plaintiff asserted the affirmative defense of setoff to the counterclaim. The FDIC was subsequently granted leave to substitute for the bank as a party.

After concluding that the circuit court was justified in granting summary judgment on the counterclaim, the appellate court went on to hold that the award of attorney fees was warranted by the evidence. The reviewing court rejected plaintiff’s claim that the FDIC was entitled to recover fees only for the prosecution of its counterclaim and not for the defense of his claims against the bank. The court reasoned that plaintiff’s claims against the bank had been asserted by him as an affirmative defense to the counterclaim in the nature of a setoff. In order to prosecute the counterclaim, it was necessary for the FDIC to dispose of plaintiff’s affirmative defenses; hence, the FDIC’s effort to defeat the setoff defense was a necessary and integral part of collecting on the promissory note. See FDIC, 155 Ill. App. 3d at 640, 508 N.E.2d at 342.

In view of FDIC, we are bound to conclude that the bank was entitled to reasonable attorney fees for defending the oral loan commitment claim brought by the Demoses. As noted above, they commenced that claim against the bank after it commenced its claim against Christ. Subsequently, Christ answered the bank’s complaint, raising the loan commitment case in the form of the affirmative defense of setoff. Like the FDIC, it was necessary for the bank to dispose of Christ’s affirmative defense of setoff; prevailing on the loan commitment case was an integral part of prevailing on the promissory note. In his reply brief on the fees issue, Christ relies on Verni v. Imperial Manor of Oak Park Condominium, Inc. (1981), 99 Ill. App. 3d 1062, 425 N.E.2d 1344, but that case involved neither an affirmative defense nor a setoff. Christ also attempts to distinguish Williams from our case on the grounds that it was not necessary for the bank to prevail in the loan commitment case in order to prevail in the note case. He argues that his “set-off defense was improper and legally deficient because it prayed for an unliquidated sum” and that “[t]he trial court properly recognized the illegitimate nature of the affirmative defense.” But under the doctrine of judicial estoppel, Christ is not permitted to assume one position in the trial court, succeed in that position, and then assume a second, contrary position in this court. (See Giannini v. First National Bank (1985), 136 Ill. App. 3d 971, 983, 483 N.E.2d 924, 935) (purposes of the doctrine of judicial estoppel are to promote the truth and to prevent parties from deliberately shifting positions to suit exigencies of the moment).) If Christ believed, as he now appears to, that the affirmative defense of setoff was meritless, he never should have raised it, or he should have at least withdrawn it; instead, by his actions, he required the bank to incur attorney fees in rebuffing it. On remand, then, the circuit court must also award the bank reasonable attorney fees for defending the oral loan commitment claim brought by the Demoses, which Christ raised as an affirmative defense.

In summary, we affirm the circuit court’s entry of summary judgment in the bank’s favor on counts I and II of the oral loan commitment action filed by Louis and Christ Demos; we affirm the court’s decision to vacate that portion of the judgment obtained by the bank which was attributable to the guaranty in its action against Christ Demos; we reverse that portion of the court’s judgment denying the bank attorney fees for litigating Christ’s affirmative defense of setoff; and we remand for a hearing on the issue of attorney fees, regarding the affirmative defense as well as Christ’s promissory note.

Affirmed in part; reversed in part and remanded with directions.

MURRAY and GORDON, JJ., concur.