author: JUSTICE LINN

text:
    DAMIANO MALFEO et al., Plaintiffs-Appellees, v. ERNEST LARSON, Defendant-Appellant.
    First District (4th Division)
    No. 1—89—3140
    Opinion filed December 27, 1990.

      Brenner, Mavrias, Dorn & Aim, of Chicago (Bruce Farrel Dorn, of counsel), for appellant.
    William C. Coughlin, of Chicago, for appellees.
   JUSTICE LINN

delivered the opinion of the court:

Plaintiffs, Damiano and Annamarie Malfeo, brought an action in the circuit court of Cook County against defendant,. Ernest Larson. Damiano sought damages for injuries that he sustained when he collided with defendant. Annamarie sought damages for loss of consortium. At the close of a bench trial, the trial court entered judgment for plaintiffs and awarded each damages.

Defendant appeals, contending: (1) the count of plaintiffs’ complaint on which the trial court entered judgment failed to state a cause of action, (2) the trial court erred by not itemizing plaintiffs’ damages, and (3) plaintiffs’ damages were excessive.

We affirm the judgment of the trial court.

Background

The trial adduced the following facts. On May 9, 1987, Damiano and Annamarie were married. At approximately 1 a.m. on the morning of May 10, Damiano and defendant were standing in line to check in at the O’Hare Hilton Hotel. A shouting match developed between Damiano and defendant. Damiano testified essentially that he raised his arms in a defensive gesture. Defendant then grabbed his arms and pulled him to the floor. Defendant fell on top of Damiano and punched him in the back of the head two or three times. Defendant testified essentially that Damiano raised his arms in a threatening gesture. Defendant then grabbed Damiano’s arms, which caused both of them to fall. He did not strike Damiano in anyway.

Damiano and defendant were separated. Damiano testified that he immediately experienced pain in his left shoulder and could not move his left arm. He was taken by ambulance to a hospital emergency room. Damiano was treated for an injured left shoulder, prescribed pain relievers, and given an arm sling. The ambulance cost $125 and the emergency room treatment cost $132.

Plaintiffs did not return to the hotel. Rather, they drove directly to the airport to catch their morning flight. Plaintiffs flew to Jamaica for a two-week honeymoon. They stayed at an “all-inclusive” resort, i.e., where airfare, food and liquor, lodging, recreation, entertainment, and all other expenses were included in one price.

The medication caused Damiano to sleep for the first day of the trip. Despite the medication, he had constant throbbing, and occasionally severe pain in his left shoulder. After a few days, Damiano took the medication only occasionally to avoid the resulting drowsiness. Damiano wore the arm sling for approximately the first week of the honeymoon and could not use his left arm during that time. He testified essentially that he could not participate in any sport activity. On cross-examination, he testified that he played water volleyball with one arm during his last few days. Further, he participated in sightseeing and shopping tours. He watched but did not participate in evening entertainment. He also ate the meals served. Plaintiffs paid $3,718 for the vacation.

Damiano testified that upon return from the honeymoon, he sought further medical treatment totalling $230. He further testified that he continued to experience shoulder pain when he performed certain activities or when lying in certain positions. He relieved the shoulder pain with aspirin. Damiano testified on cross-examination that he played league softball twice per week. He also played golf and basketball subsequent to the injury with the same frequency as prior to the injury. Damiano essentially had the same range of motion in his left shoulder as in his right shoulder.

Annamarie testified that she and Damiano were engaged for approximately 14 months. It was her first marriage. She testified that on their arrival at the resort, Damiano slept for the first day and subsequent morning. They were intimate for the first time as husband and wife on the second night of the honeymoon. Annamarie testified essentially that although she and Damiano were intimate during the honeymoon, these episodes were uncomfortable and awkward. Additionally, Damiano’s left shoulder pain prevented him and Annamarie from generally being physically close.

Plaintiffs filed their amended complaint on April 12, 1988. In count I, plaintiffs alleged civil battery and sought compensatory damages. In count II, they realleged the battery claim and sought punitive damages. Count III contained a negligence claim, in which plaintiffs alleged that defendant negligently collided with Damiano and, alternatively, failed to maintain a proper lookout while running through the hotel. Damiano sought damages for personal injuries, and Annamarie sought damages for loss of consortium.

Immediately prior to trial, the trial court granted defendant’s motion to dismiss count II, based on section 2 — 604.1 of the Code of Civil Procedure. (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 604.1.) At the close of a bench trial on August 9, 1989, the trial court entered judgment for plaintiffs on count III of the amended complaint. The court awarded Damiano $15,000 and Annamarie $5,000. On October 17, 1989, the trial court dismissed defendant’s post-trial motion. Defendant appeals.

Opinion

I

Defendant first contends that count III of the amended complaint, on which the trial court entered judgment, failed to state a cause of action. He argues that count III does not state a cause of action for negligence, but rather for a “negligent battery,” which does not exist. See W. Keeton, Prosser & Keeton, on Torts §9, at 41 (5th ed. 1984).

We note plaintiffs’ contention that defendant waived this issue on appeal because he did not include it in his post-trial motion. However, this cause was tried before the court, sitting without a jury. “In a non-jury civil case the failure to include a point in a post-trial motion does not preclude its being raised on appeal.” City of Chicago v. Mid-City Laundry Co. (1972), 8 Ill. App. 3d 88, 90, 289 N.E.2d 233, 234, cited in People v. One 1974 Chevrolet Corvette No. 1Z37J4S400951 (1983), 117 Ill. App. 3d 616, 618, 453 N.E.2d 890, 891.

To be legally sufficient, a complaint for negligence must set out facts that establish the existence of a duty owed by the defendant to the plaintiffs, a breach of that duty, and an injury proximately resulting from the breach. (Pelham v. Griesheimer (1982), 92 Ill. 2d 13, 18, 440 N.E.2d 96, 98; Mieher v. Brown (1973), 54 Ill. 2d 539, 541, 301 N.E.2d 307, 308.) Further, it is axiomatic that every person owes to all others the duty to exercise care to guard against injury which may naturally flow as a reasonably probable and foreseeable consequence of his actions. (Wintersteen v. National Cooperage & Woodenware Co. (1935), 361 Ill. 95, 103, 197 N.E. 578, 582; Harper v. Epstein (1974), 16 Ill. App. 3d 771, 772-73, 306 N.E.2d 690, 691.) Additionally, a complaint should not be dismissed unless the pleadings disclose that no set of facts could be proved that would entitle the plaintiff to relief. Business Development Services, Inc. v. Field Container Corp. (1981), 96 Ill. App. 3d 834, 837, 422 N.E.2d 86, 89.

Applying these principles to the case at bar, it is clear that count III stated a cause of action for negligence. Plaintiffs alleged therein that defendant negligently collided with Damiano, which caused him to fall and, alternatively, failed to maintain a proper lookout for his own safety and the safety of others while running through the hotel. Plaintiffs further alleged that defendant’s negligence resulted in their injuries. These facts were more than sufficient to entitle plaintiffs to relief. Accordingly, we hold that count III of the amended complaint stated a cause of action.

II

Defendant next contends that the trial court erred by not itemizing plaintiffs’ damages. He relies on section 2 — 1109 of the Code of Civil Procedure, which provides as follows:

“Itemized Verdicts. In every case where damages for injury to the person are assessed by the jury the verdict shall be itemized so as to reflect the monetary distribution among economic loss and non-economic loss, if any ***.” (Emphasis added.) (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 1109.)

Defendant argues that the trial court failed to “comply” with section 2 — 1109, and that such failure constituted error.

We cannot accept defendant’s argument. Section 2 — 1109 expressly limits its application to damages assessed “by the jury.” (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 1109.) The primary rule governing the interpretation and construction of statutes is that courts must ascertain and give effect to the intention of the legislature. We should seek the legislative intent primarily from the language that the statute uses. Where the language of the act is certain and unambiguous, the only legitimate function of the courts is to enforce the law as enacted by the legislature. (Certain Taxpayers v. Sheahen (1970), 45 Ill. 2d 75, 84, 256 N.E.2d 758, 764; People ex rel. Callahan v. Marshall Field & Co. (1980), 83 Ill. App. 3d 811, 813-14, 404 N.E.2d 368, 370-71.) Indeed, we have previously noted that “the legislative intent to the section was to require jurors to carefully consider the purpose for which each dollar in damages was awarded.” (Emphasis added.) (Doering v. Janssen (1979), 76 Ill. App. 3d 62, 67, 394 N.E.2d 721, 725.) Since this cause came to a bench trial and not a jury trial, section 2 — 1109 simply does not apply.

Further, at common law, it is not required that the various elements or items of damages be separately stated in a verdict with the amount awarded for each item. (89 C.J.S. Trial §508 at 184, (1953); S. Puterbaugh, Common Law Pleading & Practice §1163 (10th ed. 1926); see, e.g., Schultz v. Gilbert (1939), 300 Ill. App. 417, 425, 20 N.E.2d 884, 887; Holmes v. Tarble (1898), 77 Ill. App. 114, 115.) Since section 2 — 1109 directs juries to itemize its damages award, it is in derogation of the common law.

Courts strictly construe statutes in derogation of the common law, since the common law is not to be deemed abrogated by statute unless it appears clearly that such was the legislative intent. Statutes in derogation of the common law cannot be construed as changing the common law beyond what is expressed by the words of the statute or is necessarily implied from what is expressed. This principle includes statutory innovations in derogation of the common law; courts will not presume that the legislature intended an innovation further than that which the statute specified or clearly implied. Lites v. Jackson (1979), 70 Ill. App. 3d 374, 375-76, 387 N.E.2d 1118, 1119 (and authorities cited therein).

The above principle applies even to remedial statutes in derogation of the common law. The remedial aspect of such a statute does not warrant construing the statute liberally from the standpoint of exclusion and inclusion of persons. Courts reason that they cannot read into such a statute something that is not within the clearly expressed intent of the legislature. Therefore, where a statute is remedial, yet in derogation of the common law, courts will construe the statute strictly in determining what persons come within the statute. Lites, 70 Ill. App. 3d at 376, 387 N.E.2d at 1120, quoting Cedar Park Cemetery Association, Inc. v. Cooper (1951), 408 Ill. 79, 82-83, 96 N.E.2d 482, 484.

Applying these principles to the instant case, we hold that we cannot include trial judges within the meaning of section 2 — 1109 which, on its face, applies only to juries. We hold that section 2 — 1109 did not apply to the facts of this case and, consequently, that the trial court did not err by not itemizing plaintiffs’ damages awards.

Ill

Defendant next contends that plaintiffs’ damages awards were excessive. He argues that Damiano’s award of $15,000 “falls far outside the flexible limits of fair compensation.”

An award of damages is excessive and unfair if the amount falls outside of the necessarily flexible limits of fair and reasonable compensation or is so large as to shock the judicial conscience. Damages are particularly within the province of the trier of fact and a reviewing court will not disturb them on appeal unless obviously the result of passion or prejudice. (King v. City of Chicago (1978), 66 Ill. App. 3d 356, 359, 384 N.E.2d 22, 25.) The reviewing court should examine such factors as the primacy and extent of the injuries suffered, plaintiff’s age, the possibility of deterioration in the future, the medical expenses incurred, past and future wage losses and any restrictions that the injuries may have placed on the daily activities of the plaintiff. Simmons v. Union Electric Co. (1984), 121 Ill. App. 3d 743, 757-58, 460 N.E.2d 28,38, aff'd (1984), 104 Ill. 2d 444, 473 N.E.2d 946.

Damiano, whom the evidence reveals to be an athletic person, was deprived of the opportunity to enjoy most of the athletic activities offered at the resort. Further, he and Annamarie had already paid for and had planned to participate in most, if not all, of the resort’s activities during their two-week stay. Additionally, Damiano testified that the injury continued to affect him years later.

Defendant additionally contends that Annamarie’s award of $5,000 for loss of consortium was also excessive. Defendant notes that plaintiffs were unable to have sexual relations “for a period of three days and thereafter engaged in sexual relations three or four times over the next two weeks.” Defendant apparently argues that since plaintiffs had sexual relations, Annamarie’s $5,000 damages award was excessive.

This argument misses the mark. When one spouse (the impaired spouse) is injured by the negligence of another, the other spouse (the deprived spouse) may recover from the tortfeasor for the loss the deprived spouse suffered by virtue of the impaired spouse’s injury. This loss, generally labelled a loss of consortium, includes material services, elements of companionship, felicity (i.e., happiness), and sexual intercourse, all welded into a conceptualistic unity. Brown v. Metzger (1983), 118 Ill. App. 3d 855, 858, 455 N.E.2d 834, 836, aff'd (1984), 104 Ill. 2d 30, 470 N.E.2d 302.

Defendant’s argument focuses on the sexual relations of plaintiffs during the honeymoon. However, consortium includes loss of a spouse’s companionship, happiness, and society. The trial adduced facts showing such loss. Damages for loss of consortium are not subject to the detailed, in-depth analysis that can be applied to other types of damages. However, damages for loss of a husband’s society, companionship, and sexual relations are nevertheless measurable. All of the elements of loss of consortium may not be the most tangible items, but a fact finder is capable of putting a monetary worth on them. (Elliott v. Willis (1982), 92 Ill. 2d 530, 539-40, 442 N.E.2d 163, 168.) This is precisely what the trial court did in the case at bar. We conclude that plaintiffs’ damages awards were within the realm of reasonable compensation.

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

Affirmed.

McMORROW, P.J., and JIGANTI, J., concur.


source: Caselaw Access Project

license: Public Domain

text:
    STEPHEN JAMES BURNHOPE, on his own Behalf and as Representative Underwriter on Behalf of Certain Underwriters and Syndicates at Lloyds London, et al., Plaintiffs-Appellees, v. NATIONAL MORTGAGE EQUITY CORPORATION et al., Defendants-Appellants (Arthur J. Gallagher and Company, Defendant).
    First District (4th Division)
    No. 1—90—0143
    Opinion filed December 27, 1990.

      Keck, Mahin & Cate, of Chicago (Alexander D. Kerr, Jr., and Michael J. Sreenan, of counsel), for appellants.
    McCullough, Campbell & Lane, of Chicago (Dennis L. Frostic, Steven R. Smith, and Robert B. Baker, of counsel), for appellees.
   JUSTICE LINN

delivered the opinion of the court:

This action for declaratory judgment was filed by a group of underwriters and insurance companies (collectively referred to as Lloyd’s London or plaintiffs). They seek a determination that defendants National Mortgage Equity Corporation (NMEC) and David A. Feldman, NMEC’s president and majority shareholder, are not entitled to fidelity insurance coverage pursuant to certain “finance company blanket bonds.” Alternatively, plaintiffs seek a declaration that if coverage under the bonds exists, defendant Arthur J. Gallagher & Co. is liable to and must indemnify plaintiffs for whatever amounts plaintiffs must pay in losses to third parties. The merits of this declaratory judgment action are not in issue, however; instead, we are asked to determine whether the Illinois courts have personal jurisdiction over the defendants.

For the reasons that follow, we affirm the trial court’s determination that it has jurisdiction and remand for further proceedings.

Background

The underlying controversy arises out of NMEC’s organization of pools of secured real estate loans and, in connection therewith, NMEC’s marketing of “mortgage pass-through certificates” to certain financial institutions. The facts relating to the jurisdictional issues center on NMEC’s procuring of blanket bond coverage insuranee from plaintiffs through an insurance broker, Arthur J. Gallagher & Co., which is located in Rolling Meadows, Illinois.

According to the complaint, plaintiffs are certain underwriters and syndicates at Lloyd’s London, and several additional insurance companies, which collectively issued the finance company blanket bonds that are in issue in this lawsuit. NMEC is a Delaware corporation with its principal place of business located in Palos Verdes Estates, California. Feldman, a resident of California, is the president, treasurer, and majority shareholder of the company. Gallagher is an Illinois corporation with its principal place of business in Rolling Meadows.

Defendants NMEC and Feldman appeal from the trial court’s determination that Gallagher acted as their agent or broker in acquiring the bond coverage from plaintiffs and that Gallagher conducted sufficient activities in this State to justify a finding of personal jurisdiction under the Illinois long-arm statute. Ill. Rev. Stat. 1987, ch. 110, par. 2 — 209.

In 1982, NMEC organized pools of real estate loans secured by first or second deeds of trust on residential real estate located in States other than Illinois, primarily in Texas and California. NMEC then sold “mortgage pass-through certificates” to various financial institutions. Each certificate represented an undivided participation interest in an individual pool of mortgage loans. The holder of a given certificate was entitled to receive interest thereon at a fixed rate regardless of the rates that were being paid by individual mortgagors in the pool. Two banks, Wells Fargo Bank and Bank of America, were trustees for the mortgage pools in NMEC’s certificate program. The trustee banks were obligated to review the documentation provided as to each mortgage in order to determine whether it complied with the standards set out in the pooling and servicing agreements. The branches of these two banks involved in this litigation are located in California.

NMEC has no office, address, or telephone number in Illinois and does not own any property in this State. NMEC did not sell any of the mortgage certificates to any Illinois individuals or corporations. According to NMEC, it never transacted any business in this State after 1980.

It is uncontested that Thomas Gallagher, an employee of Arthur Gallagher & Co., acted as the broker or “contact person” between NMEC and the London-based underwriters, in connection with the blanket bond coverage. Gallagher conducted his business activities from the Rolling Meadows location. In his capacity as broker, he ob-tamed and transmitted information from NMEC and Feldman in California to the London insurers.

The insurance coverage in issue is part of the “finance companies blanket bond” in effect for the year 1983 (the 1983 bond) and the renewal of that bond for the following year (the 1984 bond). The 1984 bond was cancelled effective July 13, 1984. The particular coverage that is the subject of this controversy is for “[l]oss resulting directly from one or more dishonest or fraudulent acts of an [ejmployee” as defined in the insuring agreement, an apparently standard form of fidelity insurance.

In 1985, three lawsuits were filed in the Federal District Court for the Northern District of California. These suits were brought by financial institutions that had purchased the pass-through certificates. The complaints alleged fraud in connection with the sale of the certificates, as well as alleged violations of Federal securities laws and racketeering laws (RICO). Among the named defendants in those suits are the trustee banks, Wells Fargo and Bank of America. The latter bank then filed an action in the Central District of the Federal court in California, suing NMEC, Feldman, and others, and alleging that the defendants defrauded the purchasers of the certificates by misrepresenting the value of the certificates and the value of the real estate upon which the residential loans were made. This lawsuit asserts causes of action based on Federal securities law, RICO, and the California Corporation Code.

The three Federal actions pending in the Northern District of California were consolidated with the one filed in the Central District and were assigned a single number. Since then, additional, related actions have been consolidated therewith.

In response to these various claims pending against them, NMEC and Feldman sought defense and indemnification from plaintiffs under the fidelity coverage of the bonds. Thereafter, on July 1, 1987, plaintiffs filed the pending declaratory action in the circuit court of Cook County. The defendants were unsuccessful in their attempt to remove the case to the Federal court sitting in the Northern District of Illinois.

On December 30, 1988, NMEC and Feldman filed a special and limited appearance and motion to dismiss for lack of jurisdiction. The parties took discovery limited to the personal jurisdiction issues and filed memoranda with the court. Plaintiffs argued that the court had personal jurisdiction over NMEC and Feldman, either because defendants had waived their special and limited appearance by raising nonjurisdictional matters, or because Gallagher acted as the agent of NMEC and Feldman. Under the agency theory, Gallagher’s contacts with Illinois would be imputed to the California defendants. Defendants denied that they had waived the issue and argued that Gallagher was plaintiffs’ agent rather than defendants’. Further, NMEC and Feldman argued that under either the long-arm statute or the minimum contacts analysis, none of Gallagher’s actions were sufficient to form the basis of jurisdiction in Illinois.

The trial court ruled that NMEC and Feldman had not waived their challenge to jurisdiction and that Gallagher was the agent of NMEC such that his activities as agent conferred jurisdiction under the long-arm statute. The court further found that Feldman was an insured under the bonds and thus his relationship to Gallagher was identical to that of NMEC, so that jurisdiction over Feldman was also proper.

Opinion

I

We initially dispose of the waiver argument. Although plaintiffs cite cases in support of their assertion that any act going beyond a challenge to personal jurisdiction constitutes a general appearance, they do not explain why the trial court’s express finding on this issue is incorrect or an abuse of discretion. Instead, they focus on two grounds for finding waiver. First, they assert that when defendants drew the court’s attention to a “forum selection clause” in the bonds, NMEC and Feldman were invoking the court’s jurisdiction to construe the documents and grant affirmative relief. Second, they state that because NMEC and Feldman asked the court to consider a forum non conveniens argument at the same time the jurisdictional issue was to be decided, the special and limited appearance was transformed into a general appearance.

Our review of the record reveals that NMEC and Feldman did not waive their challenge to the Illinois court’s jurisdiction. The trial court noted that defendants referred to the forum selection clause “solely for the purpose of objecting to jurisdiction and thus it does not constitute a general appearance.” We agree. See Kotlisky v. Kotlisky (1990), 195 Ill. App. 3d 725, 731-32, 552 N.E.2d 1206; see also Japax, Inc. v. Sodick Co. (1990), 186 Ill. App. 3d 656, 661, 542 N.E.2d 792.

As for the presence of the forum non conveniens issue in memoranda presented to the trial court, the judge explained:

“[T]he inclusion of that argument in the brief was discussed in open court and the Court determined that it could be included for the Court’s convenience.
At that time the plaintiff did not object. In particular, what occurred was that on February 24, 1989, defendant’s counsel raised the possibility of including the Forum Non Conveniens argument in his brief because the basis for the [argument] involves similar issues as are involved in the argument concerning the application of the Long-Arm Statute to this case.
The Court agreed with the defendant that in order to avoid lengthy drawn captive briefs, that this generally would be appropriate and the Court stated at that time that it affected to decide the Long-Arm Statute first before reaching the Forum Non Conveniens issue.
On March 21, 1989, the Court allowed the plaintiff, however, to file a brief on the Long-Arm issue alone since plaintiff [believed] that confusion might result by filing both briefs.
* * *
Accordingly, the Court finds that the inclusion of the Forum Non Conveniens Argument in defendant’s brief, which was done for the Court’s convenience without objection, did not waive the special and limited appearance filed by the Defendants.”

In view of the trial court’s express findings, we see little merit in plaintiffs’ assertion of waiver. While the filing of a forum non conveniens motion might be considered a waiver of a special and limited appearance in some situations (see In re Marriage of Kelso (1988), 173 Ill. App. 3d 746, 527 N.E.2d 990), we cannot agree with plaintiffs that waiver occurred here, under these specific facts. Accordingly, we see no reason to disturb the trial court’s finding on this issue.

II

The dispositive issue in this appeal is whether the trial court correctly found that Gallagher was the agent of NMEC and Feldman and whether Gallagher’s activities in Illinois laid a sufficient foundation for jurisdiction in this State.

A

Under our long-arm statute, if a person acts as an agent on behalf of another, the agent’s jurisdictional contacts with Illinois are imputed to his principal. (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 209.) Thus, if Gallagher is deemed the agent of the California defendants, his activities in Illinois will be charged to them. The scope and nature of Gallagher’s duties, therefore, become relevant to the initial question of his role as agent.

The question of agency generally is one of fact. (See Lazzara v. Howard A. Esser, Inc. (7th Cir. 1986), 802 F.2d 260.) As the court in Lazzara noted, an insurance broker is one who procures insurance and acts as the middleman between the insured and insurer. The term “insurance agent” refers to a person with a fixed and permanent relationship to the insurance company. Such agent is considered to represent the company and has certain duties and allegiances to that company. (802 F.2d at 264.) On the other hand, a broker may be considered as the agent of the insured under certain circumstances. For example, if the insured has called the broker into action, retained control over his or her actions, and if the broker acts in the insured’s interest, the broker may be considered as the agent of the insured, even if the broker’s commission is deducted from the premiums charged by the insurance company. See, e.g., Lazzara, 802 F.2d 260 (Insurance broker who had acted on behalf of insured for many years was found to be his agent, having fiduciary obligations to insured, and therefore was liable for his failure to comply with instructions to purchase and maintain a certain amount of insurance coverage); Petty v. Cadwallader (1985), 135 Ill. App. 3d 695, 482 N.E.2d 225 (Loan broker who acted on behalf of defendants in obtaining loan commitment was considered defendants’ agent for that purpose); Roby v. Decatur Steel Erectors, Inc. (1978), 59 Ill. App. 3d 720, 375 N.E.2d 1355 (Insurance agent generally represents the insurer and broker generally represents insured; unauthorized acts of broker are not binding on insurance company).

Thomas Gallagher’s deposition in the record reveals the following: Gallagher’s understanding was that he was acting as NMEC’s broker in attempting to place insurance coverage. As a broker, he was to “solicit and obtain information for [his] customers *** and place those coverages with a variety of different insurance companies.” It was the London office of Arthur Gallagher & Co., however, that “had access to the broker who broker[ed] it to the underwriters.” According to Thomas Gallagher, NMEC could have worked with any of the nationwide Gallagher & Co. offices, which in turn would have worked with the London office in the same way that the Rolling Meadows, Illinois, office did. Lloyd’s London paid Gallagher’s company its commission. NMEC did not pay any fee for Gallagher’s procuring the bonds; instead, Gallagher was entitled to deduct a percentage from the premiums that NMEC paid. This commission was negotiated by Gallagher and the London-based underwriters.

Regarding the specific acts that Thomas Gallagher performed in connection with the bond coverage, he stated that he “made contact with [NMEC] and sent applications to them, which [were] completed, and we forwarded them to Lloyd’s.” Thomas Gallagher also spoke to David Feldman over the telephone and obtained a resume’ from Feldman to forward to London. Lord, Bissell & Brook, NMEC’s corporate counsel at the time, also provided “tremendous amounts of material.” After coverage was “bound,” Gallagher forwarded descriptions of coverages to Feldman and obtained and forwarded the policies.

The first bond, for one year, was renewed pursuant to another application from NMEC in December 1983. Initially, Lloyd’s was unwilling to renew, but after NMEC agreed to provide an independent inspection of its operations for insurance purposes, the bond was renewed. Gallagher participated in these negotiations also.

The trial court concluded that “Gallagher was defendant’s agent in pursuing and obtaining the bonds which are at issue in this case. The defendants chose Arthur Gallagher’s Illinois office. *** Defendants asked *** Thomas Gallagher to find the bonding for them on defendant’s behalf. Thomas Gallagher obtained the bonds and negotiated for their renewal.”

We do not find the trial court’s conclusion to be against the manifest weight of the evidence. NMEC needed a broker to find an insurer and selected Gallagher. Thomas Gallagher acted at the direction of NMEC and Feldman and would not have been able to place the coverage without their approval. While the actual payment for the services was in the form of a deduction from the premiums NMEC paid to the underwriters, we do not believe this one factof destroys the agency relationship between Gallagher and defendants. See Lazzara, 802 F.2d 260.

In general, a broker is viewed as the agent of the party who engages him for a particular purpose, in furtherance of that party’s interest. A broker may act on his own account, as an independent contractor, or he may act as agent for both parties to a transaction at different times. We do not agree, however, with NMEC’s characterization of Gallagher as plaintiffs’ agent. Gallagher not only placed the insurance at NMEC’s and Feldman’s request but he also participated in persuading Lloyd’s London to renew coverage in 1984, after it had expressed reluctance to do so. That Gallagher both received information from and forwarded information to plaintiffs does not make him their agent. On the whole, the record supports the trial court’s determination that Gallagher acted on behalf of defendants, and therefore acted as their agent for purposes of imputing his acts to NMEC to establish jurisdiction in Illinois under the long-arm statute.

B

NMEC and Feldman alternatively argue that even if Gallagher were their agent, his contacts with Illinois were insufficient to establish jurisdiction because he acted only as a conduit for information between the parties. Under this theory, the “transaction of business” between plaintiffs and NMEC and Feldman occurred in London and California, but not Illinois.

Under section 2 — 209 of the long-arm statute, anyone who transacts business in Illinois, personally or through an agent, is amenable to process in this State. In Petty v. Cadwallader (1985), 135 Ill. App. 3d 695, 482 N.E.2d 225, a loan broker based in Illinois sued the nonresident defendants for breach of contract after defendants refused to pay his contractual fee for procuring a loan commitment on their behalf. Like Thomas Gallagher, the loan broker sent out documents and made telephone calls from his office in Illinois. Because the Indiana defendants had engaged the broker to negotiate financing on their behalf, the majority of the court held that the broker was their agent for the purpose of obtaining the loan commitment. Accordingly, his activities in Illinois were imputed to the defendants.

In Petty, the court analyzed various factors to consider in determining whether the defendants’ contacts with Illinois were sufficient to support long-arm jurisdiction and concluded that they were. See also Scovill Manufacturing Co. v. Dateline Electric Co. (7th Cir. 1972), 461 F.2d 897 (under Illinois law, personal jurisdiction over a nonresident defendant was proper where his agent was present in Illinois while engaging in precontractual negotiations on behalf of defendant); cf. Konicki v. Wirta (1988), 169 Ill. App. 3d 21, 523 N.E.2d 160, appeal denied (1988), 122 Ill. 2d 576, 530 N.E.2d 247 (California residents who exchanged telephone calls and correspondence with Illinois plaintiffs were not subject to the jurisdiction of Illinois courts, where the negotiations for a loan began in California, was interrelated to California property, the note was executed in California, and it did not appear that defendants would expect the benefits and protection of Illinois law to apply).

NMEC and Feldman disagree with plaintiffs that Gallagher’s activities in Illinois on their behalf were “substantial,” instead contending that any contacts attributed to them in Illinois were random and fortuitous. This argument, however, ignores the fact that they chose an Illinois-based broker to assist them in obtaining the bond coverage. NMEC and Feldman could have used any of Arthur Gallagher Co.’s offices, including the one in California. The argument that their use of the Illinois office was “fortuitous” may be true, but it does not change the jurisdictional issue. Their corporate attorneys, Lord, Bissell, and Brooks were located in Illinois, which may well have influenced their decision to use an Illinois broker because of the likelihood that the law firm had substantial records or information to assist the broker in procuring the bond coverage. In any event, the trial court determined that Gallagher’s activities in Illinois were significant enough to invoke the jurisdiction of the courts of this State.

We agree with the trial court. The record establishes that Thomas Gallagher, acting in furtherance of the interests of NMEC, was responsible for the procurement of the insurance in issue. He testified in his deposition that he transferred pertinent information between the parties, discussed matters with Feldman over the telephone, and participated in the negotiations that led the London underwriters to renew bond coverage in 1984. Gallagher was defendants’ “presence” in Illinois, and he was instrumental in obtaining and renewing the bond coverage pursuant to the direction of NMEC and Feldman. We conclude that through Gallagher, NMEC and Feldman transacted a portion of their business — procuring bond coverage — in Illinois. We also find that Gallagher’s participation in the transaction was substantial because NMEC could not have gone directly to the London underwriters to obtain the insurance. In his deposition, Thomas Gallagher testified that the London office was “not a retail broker. They only deal with insurance agents and brokers in the United States or worldwide.” Therefore, even though the blanket bonds themselves had little connection with Illinois, a significant part of their negotiation took place in this State.

Under the above view of the nature and number of contacts with Illinois, it is immaterial that NMEC and Feldman did not own property in this State; that none of the residential real estate mortgages in the pools encumbered Illinois land; and that none of the pass-through certificates were marketed in Illinois. While such facts may be relevant to the more general, “doing business” analysis (see, e.g., Radosta v. Devil’s Head Ski Lodge (1988), 172 Ill. App. 3d 289, 526 N.E.2d 561), the “transaction of business” standard of the long-arm statute recognizes that the cause of action itself must arise from the defendants’ contacts with the forum State in connection with the particular transaction under review: here, the parties’ negotiation of the insurance contract.

Once the court makes the determination that the long-arm requirements have been satisfied, the court must further consider the due process requirements of the minimum contacts analysis. See R.W. Sawant & Co. v. Allied Programs Corp. (1986), 111 Ill. 2d 304, 311, 489 N.E.2d 1360, 1364 (describing two-part test for personal jurisdiction in Elinois); International Shoe Co. v. Washington (1945), 326 U.S. 310, 316, 90 L. Ed. 95, 102, 66 S. Ct. 154, 158 (formulating minimum contacts standard).

In our view, the two steps of the analysis need not be rigidly separated because both the statutory “transaction of business” test and the constitutional limitation require that there be a significant connection among the contacts of defendant, the forum State, and the litigation. As the court noted in Jabcobs/Kahan & Co. v. Marsh (7th Cir. 1984), 740 E2d 587, 592: “Where, as here, the dispute is said to ‘arise from’ the jurisdictional act or acts, the ‘relationship among the defendant, the [forum] and the litigation is the essential foundation’ of personal jurisdiction, Helicopteros Nacionales de Colombia, S.A. v. Hall[, 466 U.S. 408, 414], 104 S. Ct. 1868, 1872, 80 L. Ed. 2d 404 (1984) *** and must be such that it is reasonable to subject defendant to suit in the forum state. Worldwide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292-93, 100 S. Ct. 559, 564-65, 62 L. Ed. 2d 490 (1980).”

We conclude that the California defendants, through Gallagher, maintained sufficient contacts with Elinois and the subject matter of the litigation to satisfy the requisites of due process.

We do not suggest that whenever a nonresident of Illinois chooses an Elinois resident to perform a service that arguably could be performed anywhere, Illinois automatically will have personal jurisdiction over the nonresident. (See Orton v. Woods Oil & Gas Co. (7th Cir. 1957), 249 F.2d 198 (Louisiana resident was not amenable to Illinois jurisdiction in a lawsuit by an engineer and attorney who performed professional services for him in Chicago); Davis v. Nehf (1973), 14 Ill. App. 3d 318, 302 N.E.2d 382 (New York real estate broker who assisted the Elinois owner of a commercial building in finding tenants was not an “agent” of the Illinois defendant for purposes of imputing the broker’s actions in New York to defendant).) In fact, we are not unsympathetic to plaintiffs’ view that California may be a more suitable forum for resolving this controversy. Forum non conveniens issues are not before us, however, and we express no opinion on any matter beyond the bare jurisdictional requisites for maintaining suit in this State.

C

The final issue for our consideration is whether Illinois courts have jurisdiction over Feldman, individually. Under the fiduciary shield doctrine, an officer of a corporation may be shielded from the forum State’s jurisdiction if his or her contacts with the forum State are limited to those performed on behalf of the corporation. (See Olinski v. Duce (1987), 155 Ill. App. 3d 441, 444, 508 N.E.2d 398, 400 (“A conclusion that a foreign corporation is subject to Illinois jurisdiction does not require the further conclusion that an employee, shareholder, president, or member of the board of directors of that corporation is also subject to Illinois jurisdiction”); Washburn v. Becker (1989), 186 Ill. App. 3d 629, 542 N.E.2d 764, appeal denied (1989), 127 Ill. 2d 643, 545 N.E.2d 134 (application of fiduciary shield doctrine is discretionary, and equitable principles governing application should be analyzed in light of the particular facts of the case).) For the latest formulation of the fiduciary shield doctrine, as well as the applicability of the Illinois due process clause to the question of personal jurisdiction under the long-arm statute, see Rollins v. Ellwood (1990), 141 Ill. 2d 244.

In the pending case, Feldman’s actions as officer of NMEC ordinarily would give rise to the fiduciary shield doctrine under such cases as Olinski. Nevertheless, plaintiffs urge us to hold that Feldman is not entitled to the protection of the doctrine because he is the alleged “alter ego” of NMEC and therefore all actions he undertook on behalf of the corporation were undertaken for his own benefit as well. See Washburn, 186 Ill. App. 3d 629, 542 N.E.2d 764 (if corporation is a sham or the alter ego of defendant, corporate shield doctrine should not be employed to defeat jurisdiction).

Plaintiffs argue that since Feldman took the fifth amendment during his deposition, refusing to answer virtually every question put to him, he cannot invoke the fiduciary shield doctrine. In other words, Feldman cannot rely on his own refusal to answer relevant questions concerning his relationship with NMEC to form the basis for shielding himself from personal jurisdiction under the doctrine. Plaintiffs further contend that since Feldman has made a demand for personal insurance coverage under the policies, he cannot now take the opposite position that he acted only as the representative of NMEC.

Like the courts in Olinski and First National Bank v. Boelcskevy (1984), 126 Ill. App. 3d 271, 466 N.E.2d 1182, we believe that the question of personal jurisdiction and personal liability should not be blurred. Without expressing any opinion on the ultimate merits of the positions and defenses the parties may present, we find that the fiduciary shield doctrine should not apply in this case. Plaintiffs have asserted the alter ego theory in their pleadings. The record indicates that an outside investigatory agency determined that Feldman owned 84% of NMEC’s stock and that the board of directors did not play a vital role in managing the company. While there is no competent proof at this point that the corporate veil should be pierced, we believe that Feldman’s contacts with Illinois through Gallagher are sufficient, along with the unrebutted allegations that NMEC is his alter ego, to conclude that Illinois courts have jurisdiction over his person as well as over the corporate entity of NMEC. See Hyatt International Corp. v. Inversiones Los Jabillos, C.A. (N.D. Ill. 1982), 558 F. Supp. 932, 936; cf. Torco Oil Co. v. Innovative Thermal Corp. (N.D. Ill. 1989), 730 F. Supp. 126, 135-40.

For the foregoing reasons, we affirm the rulings of the trial court and remand this cause for further proceedings.

Affirmed and remanded.

JOHNSON and JIGANTI, JJ., concur.


text:
    STEJPAN CMARKO et al., Plaintiffs, v. JACK FISHER et al., DefendantsAppellees (Melvin A. Brandt, Appellant).
    First District (4th Division)
    No. 1—90—0264
    Opinion filed December 27, 1990.

      Melvin A. Brandt, of Chicago, appellant pro se.

    Goldwater & Associates, of Chicago (Ben Goldwater and Ruth E. Goldwater, of counsel), for appellees.
   JUSTICE LINN

delivered the opinion of the court:

The circuit court of Cook County awarded attorney fees and costs to defendants, Jack Fisher and La Salle National Bank (as trustee of a land trust), under section 2 — 611 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 611). The court entered the order against plaintiff, Stejpan Cmarko, and his attorney, Melvin Brandt.

Brandt appeals, contending: (1) defendants’ petition for sanctions did not meet minimum requirements of specificity, and (2) the trial court abused its discretion in making the award.

We affirm the order of the trial court.

Background

On May 17, 1988, Cmarko brought an action against defendants for specific performance of a contract to, buy real estate. Defendant La Salle National Bank, as trustee under trust No. 51469, owned the property located at 7432 and 7434 North Wolcott Avenue in Chicago, Illinois. Defendant Fisher owned a beneficial interest in the trust.

In the complaint, which Brandt prepared and signed, Cmarko alleged essentially that on April 27, 1988, Fisher orally accepted his offer to buy the property for $235,000. However, subsequent to this oral contract, Fisher’s attorney, Ben Goldwater, returned the written offer to Fisher’s real estate broker, Fern Sharkey, with the word “VOID” written on it. Cmarko alleged that he was ready, willing, and able to buy the property.

In his answer, Fisher alleged that in January 1988, Stelian and Joan Voinea offered $235,000 for the property. Fisher accepted, but only if the Voineas obtained a mortgage within a specified time. In April 1988, Sharkey submitted Cmarko’s offer. Goldwater subsequently informed Sharkey and Cmarko’s broker, Joseph Basan, that Fisher could not accept Cmarko’s offer until the Voineas’ contract was terminated.

Further, on May 9, 1988, the Voineas notified Goldwater that they waived the mortgage contingency paragraph of the contract and that they were able to buy the property without a mortgage. That same day, Goldwater notified Sharkey and Basan that Fisher rejected Cmarko’s offer. Cmarko’s written offer was returned to Basan. On May 12, 1988, Goldwater informed Cmarko’s attorney, Melvin Brandt, of the contract between Fisher and the Voineas.

Fisher also filed with his answer a petition for sanctions pursuant to section 2 — 611 of the Code of Civil Procedure. (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 611.) Fisher charged that Cmarko brought the specific performance action despite the following facts: that on May 6, 1988, Basan was told that Fisher could not accept Cmarko’s offer because a contract already existed; that on May 9, 1988, Basan was told that the contract would proceed without a mortgage contingency and that Cmarko’s offer was rejected; that on May 10, 1988, Cmarko’s offer was returned to Basan, with Fisher’s signature deleted and the word “VOID” marked thereon; that on May 12, 1988, Goldwater spoke to Brandt and told him about the above-stated facts; and that despite those facts, Cmarko filed a complaint for specific performance, which Brandt prepared and signed.

On April 14, 1989, following a trial on the action for specific performance, the court found for Fisher. The court found that the purported agreement lacked both acceptance and delivery. Therefore, the court held that Cmarko and Fisher never entered into a contract. Consequently, there was no basis for specific performance.

On December 27, 1989, following a hearing, the trial court granted Fisher’s petition for sanctions. The court found that Goldwater notified both Sharkey and Basan of the Voineas’ prior contract. Further, Goldwater subsequently notified Sharkey and Basan that the Voineas waived the mortgage contingency clause and, thus, the contract would be consummated. The court additionally noted that Basan had access, via computer, to a real estate listing service. On and prior to the date of Cmarko’s offer to Fisher, the property was designated “under contract.”

The trial court found that Cmarko or Brandt should have investigated the existence of the Voineas’ contract prior to the filing of the action. The court found “no indication that [Cmarko] or [Brandt] made a reasonable inquiry and had well grounded facts for the [filing of the action].” The trial court awarded Fisher $6,000 in attorney fees and $96 in costs. The court assessed the award against both Cmarko and Brandt. Only Brandt appeals.

Opinion

Initially, former section 2 — 611 of the Code of Civil Procedure subjected a party to sanctions for pleading allegations and denials made without reasonable cause and found to be untrue. (Ill. Rev. Stat. 1985, ch. 110, par. 2 — 611.) However, section 2 — 611, as amended effective November 25, 1986, required an attorney to sign pleadings and other papers filed with the court. By his signature, the attorney certified that he had made a reasonable inquiry into its basis and believed that it was well grounded in fact, warranted by existing law, and was made in good faith. Ill. Rev. Stat. 1987, ch. 110, par. 2 — 611.

The amended section 2 — 611 was intended to prevent counsel from making assertions of fact or law without support. The section imposed an obligation on an attorney not to file frivolous pleadings or other papers. Such documents filed in violation of section 2 — 611 subjected the party, the party’s attorney, or both, to an appropriate sanction. That sanction may have included an order to pay the other party's attorney fees and costs. (In re Custody of Caruso (1989), 185 Ill. App. 3d 739, 742-43, 542 N.E.2d 375, 377-78.) Section 2-611 was replaced by Illinois Supreme Court Rule 137, effective August 1, 1989. (134 Ill. 2d R. 137.) Since the complaint in the case at bar was filed on May 17, 1988, amended section 2 — 611 controls.

I

Brandt first contends that Fisher’s petition for sanctions was not sufficiently specific. His argument focuses on the truth or falsity of the complaint. He argues that Fisher’s “petition does not contain a single allegation in reference to what- statements or pleadings were falsely made, nor does it specify what fees resulted from the false statements or pleadings.” A motion for sanctions must meet minimum requirements of specificity so that a responding party has an opportunity to challenge and defend against the allegations made and so that fees and costs may be fairly apportioned. Geneva Hospital Supply, Inc. v. Sanberg (1988), 172 Ill. App. 3d 960, 965-66, 527 N.E.2d 611, 614, citing Brandel Realty Co. v. Olson (1987), 159 Ill. App. 3d 230, 235, 512 N.E.2d 85, 88.

We cannot accept Brandt’s contention. Earlier in this opinion we described Fisher’s petition. It alleged ample facts to allow Cmarko and Brandt to challenge and defend against the allegations. Further, Brandt misconstrues the statute. Amended section 2 — 611 imposed “upon both client and counsel the duty to make a reasonable inquiry into the facts to support a legal claim or defense before pleadings and other legal papers are filed with the court.” (Chicago Title & Trust Co. v. Anderson (1988), 177 Ill. App. 3d 615, 622, 532 N.E.2d 595, 600.) Fisher’s motion for sanctions alleged facts going to this exact issue. We hold that Fisher’s petition for sanctions was sufficiently specific.

II

Brandt also contends that the trial court abused its discretion in imposing section 2 — 611 sanctions against him. Brandt claims essentially that the complaint for specific performance was well grounded in fact and law. He argues that attorneys, “as officers of the court, are allowed to exercise broad discretion based upon their honest judgment of the facts presented” (emphasis added).

Brandt again misconstrues the statute. Under the amended section 2 — 611, an attorney’s subjective opinion of the merits of his position is irrelevant. Rather, the attorney and client must inquire into the facts to support a legal claim. A court must use an objective standard to determine whether a particular inquiry was reasonable, based upon the circumstances that existed at the time the pleading was filed. (Chicago Title & Trust, 177 Ill. App. 3d at 622-23, 532 N.E.2d at 600.) The attorney must objectively review the information submitted by the client, to determine if it factually supports the client’s claim. If such review reveals important discrepancies, inconsistencies, or gaps in the information provided, the attorney must investigate further prior to filing the relevant legal paper with the court. Additionally, we will not disturb a trial court’s imposition of sanctions absent an abuse of discretion. 177 Ill. App. 3d at 625, 532 N.E.2d at 601.

After reviewing the record, we cannot say that the trial court abused its discretion in imposing sanctions against Brandt. As stated earlier, the trial court found that Goldwater notified both Sharkey and Basan on the Voineas’ contract. Further, Goldwater subsequently notified Sharkey and Basan that the Voineas waived the mortgage contingency clause and that the contract would be consummated. Additionally, Basan had access to a real estate listing service. On and prior to the date of Cmarko’s offer to Fisher, the property was designated “under contract.” We agree with the trial court that Brandt could have discovered these facts had he made a reasonable inquiry prior to filing the complaint.

Brandt lastly argues that his professional obligations ended once he filed the complaint. He stated: “An attorney has no continuing duty to re-evaluate his case during the pendency of the trial.” He further argues that the existence of factual issues necessitated a trial.

This argument lacks merit. An attorney has a professional duty to promptly dismiss a baseless lawsuit, even over the objections of the client, when the attorney learns that the client has no case. (In re Custody of Caruso (1989), 185 Ill. App. 3d 739, 744, 542 N.E.2d 375, 378-79, citing Van Berkel v. Fox Farm & Road Machinery (D. Minn. 1984), 581 F. Supp. 1248.) In the instant case, approximately eight months elapsed between the filing of the complaint and the trial on the merits. An attorney may not shield his transgressions behind the simplistic plea that he was only exercising his right to a trial. (Caruso, 185 Ill. App. 3d at 745, 542 N.E.2d at 379.) We agree with the trial court that Brandt insisted on a trial of a baseless lawsuit. We uphold the trial court’s imposition of section 2 — 611 sanctions against Brandt.

For the foregoing reasons, the order of the circuit court of Cook County is affirmed.

Affirmed.

McMORROW, P.J., and JIGANTI, J., concur.


author: JUSTICE COCCIA

text:
    HARRIS TRUST AND SAVINGS BANK, as Trastee, Plaintiff-Appellant, v. La SALLE NATIONAL BANK, as Trastee, et al., Defendants-Appellees.
    First District (5th Division)
    No. 1—88—3413
    Opinion filed December 28, 1990.

      Kevin M. Forde, Ltd., of Chicago (Kevin M. Forde and Mary Anne Mason, of counsel), for appellant.
    Louis R. Hegeman and Jay D. Stein, both of Gould & Ratner, of Chicago, for appellees.
   JUSTICE COCCIA

delivered the opinion of the court:

I

This appeal arises from a dispute between a lessor and its lessees regarding the interpretation of a lease. The circuit court adopted lessees’ construction of the lease, granted their motion for judgment on the pleadings, and denied lessor’s motion for partial summary judgment. The circuit court then granted lessor’s request to certify the question of the lease’s interpretation to us, and we allowed its appeal.

II

Plaintiff-lessor Harris Trust & Savings Bank (lessor) filed its amended complaint on February 5, 1986. Lessor alleged that it was trustee under a land trust and that defendant La Salle National Bank was trustee under four other trusts. Six persons, as nominees, were also named as defendants, along with a development company. (We shall collectively refer to all defendants as lessees.) Lessor further alleged that on May 1, 1969, it and Chicago Title & Trust Company, as lessee, executed a lease for certain real estate. located in Chicago. Copies of the 51-page lease and an 11-page addendum, executed that same day, were attached to the amended complaint. The lease and addendum contemplated that either party could request a reappraisal of the property, for the ultimate purpose of raising or lowering the rent based on the fluctuation of the land’s value. If the parties could not agree about the land’s value, they were to appoint appraisers. Section 2.02 of the lease set forth the standards by which the appraisers would be governed in making their appraisals:

“The appraiser or appraisers so selected shall be instructed that in making such appraisal that the Land is to be valued as vacant land, without regard to the existence of any Improvements at the time located thereon, to the existence of this Lease, or to the fact that the Land is being used in conjunction with the Adjacent Parcels.”

On June 29, 1981, lessor went on to allege, it served notice on the lessees, requesting a reappraisal to determine the amount of additional annual rental. Pursuant to the lease, lessor and lessees each designated an appraiser. Lessor averred that the appraisers were unable to agree upon a valuation of the real estate, due to an actual controversy concerning the rights of the parties under the lease. Because of the inability to agree upon the meaning of section 2.02, lessor continued, the parties were unable to agree upon the instructions to be given their appraisers, so no reappraisal had been made. Lessor claimed that lessees took the position that section 2.02 precluded consideration by the appraisers of the possibility that the parcel could be used in conjunction with adjoining parcels — “the possibility of assemblage.” This position, lessor asserted, was contrary to the clear meaning of the lease language, to the intent of the parties to the lease, and to generally accepted appraisal standards used to value parcels of commercial real estate. In addition, failure to take into account the land’s highest and best use, including the possibility of assemblage, when appraising it resulted in an artificially low valuation of the property, thereby depriving lessor of additional rents. Lessor prayed for a declaration of the parties’ rights under the lease and judgment in the amount of additional annual rent, plus interest from May 1, 1981.

In their answer to lessor’s amended complaint, lessees admitted that the parties were unable to agree upon the meaning of section 2.02. However, lessees denied that lessor’s interpretation of section 2.02, requiring the appraisers to consider the possibility of assemblage, was correct.

Accordingly, lessees moved for judgment on the pleadings, pursuant to section 2 — 615(e) of the Illinois Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, par. 2 — 615(e)). Lessees confirmed that lessor owned the land in question and went on to state that they were the current tenants, being the assignees of the original tenants. The lease entered into between lessor and lessees’ predecessors in interest demised the premises until August 31, 2067, lessees noted. The parcel at issue was one of four parcels on which the office building known as Mid-Continental Plaza had been constructed, after the lease was executed. Lessees argued that the appraisers designated by the parties could not agree because lessor, contrary to the lease’s language, incorrectly instructed its appraiser. Specifically, lessees contended, lessor’s interpretation — that the appraisers had to consider the possibility of assemblage — was incorrect as a matter of law. In effect, lessees maintained, lessor was asking the appraisers to consider the possibility of that which was impossible; that is, if under section 2.02 the appraisers could not consider the fact of assemblage (“the fact that the Land is being used in conjunction with the Adjacent Parcels”), then they could not consider the possibility of assemblage. Lessees concluded that, as there were no fact questions raised by the pleadings, and as their interpretation of the lease was correct as a matter of law, they were entitled to judgment on the pleadings.

Lessor filed a memorandum in opposition to lessees’ motion for judgment on the pleadings. In support of its memorandum, lessor submitted the affidavits of Stanton Schuman, Milton I. Shadur, and Steven Fennell. Both Schuman and Shadur participated in the lease negotiations on behalf of lessor, and both affirmed that the purpose of section 2.02 was to preclude consideration of the actual assemblage of the property, but not to preclude consideration of the potential assemblage of the property as vacant land with adjacent parcels. In addition, they both stated that no contrary interpretation of section 2.02’s language was ever expressed by anyone representing the original tenants’ interests during the negotiations which preceded the execution of the lease. In his affidavit Fennell, an appraiser, affirmed that the appraisal standards generally applicable to the appraising of commercial real estate provide for valuation of property at its highest and best use, including the potential use of property in conjunction with adjacent parcels. In light of these facts, lessor contended, lessees’ motion for judgment on the pleadings should be denied.

Subsequently, lessor filed a supplemental memorandum in opposition to lessees’ motion. Along with the supplemental memorandum, lessor submitted the affidavit of George I. Cowell, an attorney who represented the interests of the original tenants during the lease negotiations. Cowell affirmed:

“The purpose of [section 2.02] was to prevent the appraisers from considering the actual use of the property in determining the Fixed Rent and Additional Rent due under the Lease and the Lease Addendum. It was my understanding that [section 2.02] was not intended by the Lessees to preclude the appraisers, in valuing the Land as vacant land, from applying generally accepted appraisal standards and considering the property’s highest and best use, including potential use of the property in conjunction with adjacent parcels, so long as they did not take into account the fact that the assemblage was in fact completed, and that the property was improved with a valuable building and was the subject of a long-term lease.”

On the basis of Cowell’s affidavit, as well as those it submitted earlier, lessor asserted that section 2.02 did not preclude the appraisers from considering the possibility of assemblage.

Lessees then filed a reply memorandum in support of their motion for judgment on the pleadings. Initially, lessees argued that the circuit court should strike lessor’s affidavits, on the grounds that they could not be considered in deciding whether to grant judgment on the pleadings. Lessees went on to contend that the highest and best use standard did not apply — and, thus, the possibility of assemblage could not be considered — because the parties had agreed to create a different standard in section 2.02.

Lessor filed a motion for partial summary judgment. Along with its motion, lessor resubmitted the Schuman, Shadur, Fennell, and Cowell affidavits. Based on this evidence, lessor maintained, there was no genuine issue of material fact regarding the interpretation of section 2.02; consequently, it was entitled to judgment as a matter of law, as well as a declaration that the appraisers must consider the possibility of assemblage.

Lessees filed a memorandum in opposition to lessor’s motion for partial summary judgment. Regardless of the extrinsic evidence, lessees argued, lessor’s reading of section 2.02 was incorrect. But even going beyond the text of section 2.02, lessees contended, both the landlord and the original tenants intended that the appraisers should not be permitted to consider the possibility of assemblage. In support of this point, lessees submitted the affidavits of Raymond Sher and Clifford Zoll. Sher, the only living principal on behalf of the original tenants, affirmed that it was his intent to preclude the appraisers from considering the possibility of assemblage; Zoll, the appraiser retained by lessees in 1981, affirmed that the appraisers were precluded from considering the possibility of assemblage. Lessees also incorporated the testimony of Schuman, from his discovery deposition, that there were no discussions of the possibility of assemblage during the lease negotiations. Finally, lessees asserted that the deposition testimony of David Logan, the lessor’s sole principal, supported their construction of section 2.02. Lessees concluded, therefore, that issues of fact abounded, requiring the denial of summary judgment.

Lessor then filed a reply in support of its motion for partial summary judgment, and a hearing was held in the circuit court on February 2, 1988. After hearing arguments from both parties, the court reserved its ruling. The court announced its decision on March 25, 1988. The court ruled that section 2.02 meant that the appraisers could not consider possible assemblage. The court also granted lessees’ motion to strike lessor’s affidavits, in conjunction with the motion for judgment on the pleadings. The court denied lessor’s motion for partial summary judgment, because of what it described as “the many controverted issues involved in this case.” The court concluded by noting that it did not find section 2.02 to be ambiguous. A written order was entered later that day, confirming these rulings. The order provides that lessees’ motion to strike lessor’s affidavits was granted, to the extent they were submitted in response to the motion for judgment on the pleadings; that lessor’s motion for partial summary judgment was denied; and that lessees’ motion for judgment on the pleadings was granted, it being declared that the appraisers could not consider the possibility of assemblage.

On October 18, 1988, the circuit court heard arguments on lessor’s motion to reconsider the entry of judgment on the pleadings and the denial of partial summary judgment. The court denied the motion to reconsider, but granted lessor’s request that the interpretation of section 2.02 be certified to this court. On November 11, 1988, the circuit court entered an order, formally denying lessor’s motion for reconsideration. The order also recites:

“The Court finds that its Order granting defendants’ motion for judgment on the pleadings and denying plaintiff’s motion for summary judgment involves a question of law as to which there is substantial ground for difference of opinion, said question being:
Whether the following Lease language permits consideration of the possibility of assemblage upon re-appraisals of the property: ***.”

The order then quotes section 2.02. The court further found that an immediate appeal might materially advance the ultimate termination of the litigation. The order concludes by stating that lessor’s alternative request for certification pursuant to Illinois Supreme Court Rule 308(a) (see 107 Ill. 2d R. 308(a)) was granted. We then allowed the appeal.

III

Lessor argues on appeal that the circuit court erred in granting lessees’ motion for judgment on the pleadings. It also contends that the circuit court erred in denying its motion for partial summary judgment. In the alternative, should we find a genuine issue of material fact regarding the interpretation of section 2.02, lessor requests that the cause be remanded for an evidentiary hearing on the question certified by the circuit court. Lessees respond that judgment on the pleadings was properly granted and that partial summary judgment was properly denied. It is their theory on review, as below, that if the appraisers may not consider the fact of assemblage under section 2.02, then they may not consider the possibility of assemblage.

This court has stated that the interpretation of a lease is a question of law, to be determined by the reviewing court independently of the trial court’s judgment. (See Hartwig Transit, Inc. v. Menolascino (1983), 113 Ill. App. 3d 165, 168, 446 N.E.2d 1193, 1195.) If the lease is ambiguous, then extrinsic evidence may be considered in ascertaining its true meaning. (See Pioneer Trust & Savings Bank v. Lucky Stores, Inc. (1980), 91 Ill. App. 3d 573, 575, 414 N.E.2d 1152, 1154.) We have defined ambiguous contracts, including leases, as those being capable of being understood in more senses than one; agreements obscure in meaning, due to an indefiniteness of expression or double meaning. (See Lucky Stores, 91 Ill. App. 3d at 575, 414 N.E.2d at 1154.) Put another way, extrinsic evidence may be considered to explain language which is reasonably susceptible to more than one meaning. (See Hartwig Transit, 113 Ill. App. 3d at 168, 446 N.E.2d at 1196.) Extrinsic evidence, in turn, is that regarding the position of the parties, the surrounding circumstances existing at the time of execution, and the parties’ subsequent conduct. (See Midwest Bank & Trust Co. v. Scot Lad Foods, Inc. (1986), 140 Ill. App. 3d 166, 169, 488 N.E.2d 676, 678.) It must be remembered, however, that our primary objective is to determine and give effect to the intent of the parties to the lease. Scot Lad Foods, 140 Ill. App. 3d at 169, 488 N.E.2d at 677.

Applying these principles to section 2.02, we conclude that it is ambiguous as a matter of law regarding the possibility of assemblage. In other words, section 2.02 is reasonably susceptible to more than one meaning. Lessees’ point — that if the appraisers may not consider the fact of assemblage under section 2.02, then they may not consider the possibility of assemblage — is persuasive at first glance, but it does not withstand scrutiny. The text of section 2.02, quoted above, plainly requires the appraisers to consider many fictions or impossibilities: that the land is vacant; that it has not been improved; that no lease exists; and that there has been no actual assemblage. Consequently, for the appraisers to consider one more fiction or impossibility, namely the possibility of assemblage, is not necessarily contrary to the language of section 2.02. Lessees do not deny that there is such a concept as possibility of assemblage, and they go so far as to admit that it is the usual standard. Moreover, there is authority in this State which supports the proposition that both actual and potential uses of realty must be considered when value is at issue. (See, e.g., Department of Public Works & Buildings v. Hufeld (1966), 68 Ill. App. 2d 120, 127-28, 215 N.E.2d 312, 316.) In brief, the fact that the text of section 2.02 neither expressly rules out nor expressly rules in consideration of the possibility of assemblage renders it ambiguous.

But even when the extrinsic evidence submitted by the parties is considered, their intent concerning the possibility of assemblage cannot be determined as a matter of law. On the one hand, the affidavits submitted by lessor suggest that possibility of assemblage is typically considered when commercial real estate is being appraised, and that the original parties assumed that it would be considered during reappraisals; on the other hand, lessees’ materials suggest that the possibility of assemblage was never discussed during the negotiations which preceded the execution of the lease. We think that the most prudent course is to remand the cause to the lower court for an evidentiary hearing on the parties’ intent regarding the possibility of assemblage. (See Lucky Stores, 91 Ill. App. 3d at 576, 414 N.E.2d at 1155) (declaratory judgment appeal remanded for evidentiary hearing, so circuit court could determine intent of parties concerning ambiguous lease provision).) And, we note that this court has been reluctant to rule as a matter of law, on the basis of a limited record, when industry custom and practice is at issue. (See, e.g., Vincent DiVito, Inc. v. Vollmar Clay Products Co. (1989), 179 Ill. App. 3d 325, 328, 534 N.E.2d 575, 577.) Therefore, while the circuit court correctly denied partial summary judgment, it incorrectly granted judgment on the pleadings, for section 2.02 does not preclude or require consideration of the possibility of assemblage as a matter of law.

IV

For the stated reasons, we hold that the circuit court did not err in denying lessor’s motion for partial summary judgment. However, as we further hold that the circuit court erred in granting lessees’ motion for judgment on the pleadings, the cause will be remanded for an evidentiary hearing on the question certified.

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

LORENZ and MURRAY, JJ., concur.


author: PRESIDING JUSTICE LORENZ

text:
    DONALD KURR et al., Plaintiffs-Appellees, v. THE TOWN OF CICERO et al., Defendants-Appellants.
    First District (5th Division)
    No. 1—89—3420
    Opinion filed December 28, 1990.

      Joseph G. Bisceglia and Robert R Zapinski, both of Jenner & Block, of Chicago, and Dennis E. Both, Town of Cicero Attorney, of Cicero, for appellants.
    John K. Kneafsey and Stephen G. Kehoe, both of Nisen & Elliott, of Chicago, for appellees.
   PRESIDING JUSTICE LORENZ

delivered the opinion of the court:

Defendants appeal from the entry of summary judgment in plaintiffs’ favor on count I of their two-count complaint. We consider whether this court has jurisdiction over the appeal under Supreme Court Rule 304(a) (107 Ill. 2d R. 304(a)) when the order appealed from states “[tjhere is no just reason to delay enforcement of this Order.” We dismiss the appeal for lack of jurisdiction.

Plaintiffs are the beneficial owners of property located in Cicero, Illinois. In an effort to sell the property, plaintiffs applied to Cicero for a certificate of compliance which was denied because the property violated certain provisions of the housing code.

Plaintiffs filed a two-count complaint against defendants. In count I, plaintiffs sought mandamus relief to require defendants to issue the certificate of compliance, and in count II, plaintiffs sought monetary and equitable relief for an alleged violation of their constitutional rights.

On December 13, 1989, the trial judge entered an order granting summary judgment on count I in plaintiffs’ favor. Count II remained pending. The order stated, in relevant part:

“It is hereby ordered that *** Plaintiffs[’] Motion [for summary judgment on count I] and Writ of Mandamus is granted. * * *
[Defendants] shall issue the certificate of compliance for the property *** within five (5) days hereof, on or before December 18, 1989. *** This Court retains jurisdiction to enforce this Order. This matter is continued for further hearing on December 19,1989 at 9:30 a.m.
Count II is returned to the assignment Judge. There is no just reason to delay enforcement of this Order.”

Before the order was entered, the parties argued as to whether the trial judge could require enforcement of the order without making a finding pursuant to Supreme Court Rule 304(a) that the order was final and there was no just reason to delay enforcement or appeal. The judge stated that he believed he could require enforcement of the order and, if defendants complied with the order by December 18, he would “drop all jurisdiction over count I *** [and] enter an additional order providing whatever is necessary to get this on up to the Appellate Court.”

On December 14, 1989, the day after the order was entered, defendants filed a notice of appeal. Plaintiffs moved this court to dismiss the appeal for lack of jurisdiction.

Opinion

Supreme Court Rule 304(a) provides:

“If multiple parties or multiple claims for relief are involved in an action, an appeal may be taken from a final judgment as to one or more but fewer than all of the parties or claims only if the trial court has made an express written finding that there is no just reason for delaying enforcement or appeal.” (Emphasis added.) (107 Ill. 2d R. 304(a).)

In this case, a Rule 304(a) finding was necessary before an appeal could be taken because summary judgment was entered on count I of plaintiffs’ complaint while count II remained pending. (First National Bank v. Lewis (1987), 163 Ill. App. 3d 160, 516 N.E.2d 552.) Defendants contend that a Rule 304(a) finding was made because the order stated “[t]here is no just reason to delay enforcement of this Order.”

In First National Bank (163 Ill. App. 3d at 161, 516 N.E.2d at 552), the trial judge entered an order granting partial summary judgment in defendant’s favor stating “ ‘[t]here is. no just reason to delay enforcement of this order.’ ” On appeal from the order, this court found that because the trial judge did not make a finding concerning appealability, the language was insufficient to confer jurisdiction under Rule 304(a). The appeal was dismissed.

Similarly, in Rauscher v. Albert (1985), 138 Ill. App. 3d 799, 801, 485 N.E.2d 1362, 1364, the order appealed from stated “ ‘[t]his Order is a final judgment and execution may issue instanter.’ ” The appeal was dismissed because the order referred to enforcement but not to appealability. The court in Rauscher found that under Rule 304(a) the trial judge was required to find that the order was enforceable and appealable.

The present case parallels both First National Bank and Rauscher. In fact, the language in the order in this case was identical to the language used in First National Bank which was not considered a Rule 304(a) finding. Supreme Court Rule 304(a) requires that the judge make an express finding that there is no just reason to delay enforcement or appeal. Without a Rule 304(a) finding,

“any judgment that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties is not enforceable or appealable and is subject to revision at any time before the entry of a judgment adjudicating all the claims, rights, and liabilities of all the parties.” (107 Ill. 2d R. 304(a).)

Although the trial judge in this case found the order was enforceable, he did not find it was appealable under Rule 304(a). Because a Rule 304(a) finding was not made, this appeal must be dismissed.

This is not a case where the trial judge, intending to make a Rule 304(a) finding, entered a poorly drafted order. (See Kucharski v. Floro (1989), 191 Ill. App. 3d 1032, 1032, 548 N.E.2d 483, 484 (order which stated it was “final and appealable *** pursuant to Rule 304(a)” was sufficient under Rule 304(a) although it did not state that there was no just reason to delay enforcement or appeal).) The order entered in this case did not refer to Rule 304(a). Further, the judge’s comments make it clear that he did not intend to make a Rule 304(a) finding when he entered the order. He stated that he would consider entering an order with a Rule 304(a) finding if there was compliance with the order entered on December 13.

The question of whether it was proper for the trial court to require enforcement of the order without granting the right to appeal is not before this court. (But see Rauscher, 138 Ill. App. 3d 799, 485 N.E.2d 1362 (court dismissed appeal for lack of jurisdiction under Rule 304(a) and stated that it would violate due process to permit enforcement of order without allowing appeal).) Without jurisdiction, this court cannot consider the merits of the trial judge’s order.

Alternatively, defendants argue that a Rule 304(a) finding was not necessary to confer jurisdiction to this court because count II was severed from count I. A Rule 304(a) finding is not necessary to appeal from a final judgment entered on a severed claim if the severance was not an abuse of discretion. (Northtown Warehouse & Transportation Co. v. Transamerica Insurance Co. (1986), 111 Ill. 2d 532, 490 N.E.2d 1268.) However, the supreme court has explained:

“[T]he trial court, in its severance order, [must] clearly and unequivocally statef] that the claim, counterclaim or the party has indeed been severed (in the narrow sense of that word) and that the severed claim, counterclaim or party shall proceed thereafter separate from the other claims, counterclaims or parties to the case.” (Emphasis in original.) (Carter v. Chicago & Illinois Midland R.R. Co. (1988), 119 Ill. 2d 296, 307-08, 518 N.E.2d 1031, 1037.)

Defendants claim that the counts were severed because the trial judge “treated” the counts separately. Under Carter, a severance order must clearly and unequivocally state that the claim has been severed. Defendants do not rely on a severance order. Despite defendants’ claim, there is no support in the record that the trial judge severed counts I and II and, therefore, a Rule 304(a) finding was necessary to appeal from the entry of summary judgment on count I while count II was pending.

Lastly, we deny defendants’ renewed request for a writ of prohibition which was previously denied by this court for want of jurisdiction.

Appeal dismissed.

MURRAY and GORDON, JJ., concur.


author: JUSTICE MURRAY

text:
    GENERAL ELECTRIC RAILCAR SERVICES CORPORATION, Plaintiff-Appellee, v. WILMINGTON TRUST COMPANY, Defendant-Appellant (National Bank of Washington, Defendant-Appellant).
    First District (5th Division)
    Nos. 1—90—1668, 1—90—1669 cons.
    Opinion filed December 28, 1990.
    Rehearing denied February 8, 1991.

      Mary T. Zerega, of McDermott, Will & Emery, of Chicago, for appellant Wilmington Trust Company.
    Damon E. Dunn and Julie L. Murphy, both of Levin & Funkhouser, Ltd., of Chicago, for appellant National Bank of Washington.
    Hubert O. Thompson, of Carney & Brothers, Ltd., of Chicago, for appellee.
   JUSTICE MURRAY

delivered the opinion of the court:

Petitions for leave to appeal an order of the circuit court of Cook County denying motions to quash service for want of in personam jurisdiction, brought pursuant to Supreme Court Rule 306(a)(1)(iii) (107 Ill. 2d R. 306(a)(1)(iii)), were granted by this court to Wilmington Trust Company (WTC) (No. 1 — 90—1668) and to the National Bank of Washington (NBW) (No. 1 — 90—1669). The appeals have been consolidated, and the only issue before this court is whether the trial court erred when it ruled that, pursuant to section 2 — 209 of the Code of Civil Procedure (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 209), WTC, a Delaware corporation whose principal place of business is in Wilmington, Delaware, and NBW, a Delaware corporation whose principal place of business is in Washington, D.C., were subject to the jurisdiction of Illinois courts for the purpose of defending a breach of contract action brought by General Electric Railcar Services Corporation (GERSCO), a Delaware corporation whose principal place of business is in Chicago, Illinois.

While the ultimate issue, the interpretation of section 2 — 209 of the Code or the so called long-arm statute, is a rather straightforward one, it is the facts of the case which complicate the matter. The facts of the case, as alleged in GERSCO’s complaint, are as follows.

On May 15, 1972, a trust (Trust) was formed by WTC and NEW for the purpose of purchasing certain railroad locomotives from the manufacturers, General Motors and the General Electric Company (not GERSCO). The defendants were the beneficiaries of this Trust, and WTC acted as the trustee. At the time the Trust was formed, it was intended that the Trust would lease the locomotives to the Chicago, Milwaukee, St. Paul and Pacific Railroad Company (Chicago Railroad). A lease agreement (Lease), concerning this arrangement, also dated May 15, 1972, was fully executed on June 13, 1972. It provided that WTC, as trustee, would lease the locomotives to Chicago Railroad, as lessor, for a period of 15 years, expiring on December 1, 1987.

At the same time, a letter agreement (Letter), dated June 12, 1972, was entered into by WTC and NEW, in their individual capacities, with NAG Leasing Corporation, a subsidiary of North American Car Corporation (NACC), which apparently operated out of Chicago, Illinois. This Letter provided that: (a) NAC Leasing Corporation would receive compensation for the services it provided in arranging and negotiating the Lease, and (b) that, upon the termination of the Lease, NACC would attempt to renegotiate the lease, provide services in remarketing the equipment or purchase the locomotives for a guaranteed price.

On December 4, 1984, NACC filed a voluntary petition for relief under chapter 11, Title 11, of the United States Code, and on February 14, 1986, with the approval of bankruptcy court, NACC agreed to sell certain assets, including the remarketing agreement, to General Electric Credit Corporation (GECC) or its designee. GERSCO, the designee of GECC, then notified WTC and NEW on July 23, 1986, that it had acquired all rights, title and interest in the Letter, which WTC and NEW had entered into with NACC.

Apparently on April 2, 1987, WTC advised GERSCO that GERSCO’s services would not be required for the remarketing of the equipment, and the leased equipment was later sold. GERSCO alleged that it was due compensation under the Letter, despite the fact that it did not actually perform any remarketing services, since it always stood ready to perform.

Whether GERSCO is entitled to any compensation under the aforementioned Letter agreement it purchased from NACC is not at issue on appeal. The issue is whether WTC and NEW, foreign corporations, are subject to the jurisdiction of our Illinois courts. In response to GERSCO’s complaint, both NEW and WTC filed motions to quash service and dismiss for lack of personal jurisdiction. They appeared specially to contest jurisdiction, contending that they were foreign corporations that did not transact business in Illinois. The trial court denied their motions and both defendants appeal.

Since the only issue before this court is whether the defendants, WTC and NEW, were properly found to be subject to the jurisdiction of Illinois courts, we begin our discussion with a recitation of the pertinent provisions of the so-called long-arm statute, section 2 — 209 of the Code, upon which jurisdiction was founded. (Ill. Rev. Stat., 1988 Supp., ch. 110, par. 2 — 209.) This statute provides:

“(a) Any person, whether or not a citizen or resident of this State, who in person or through an agent does any of the acts hereinafter enumerated, thereby submits his person, and, if an individual, his or her personal representative, to the jurisdiction of the courts of this State as to any cause of action arising from the doing of any such acts:
(1) The transaction of any business within this State;
* * *
(d) Only causes of action arising from acts enumerated herein may be asserted against a defendant in an action in which jurisdiction over him or her is based upon this Section.”

As can be seen from the provisions stated above, the statute precludes Illinois courts from exercising personal jurisdiction over corporations that do not transact business in this State. We observe that, after reviewing Illinois and Federal case law concerning the interpretation of this statute, it might more aptly be named the short-arm statute, rather than the long-arm statute.

In any event, defendants in this case continue to argue that they did not transact business in this State within the meaning of the statute and that, even if they did transact business in this State, the present cause of action did not arise from the transaction of that business. The trial court, however, found that the Lease, which had been entered into by the Trust, was attributable to WTC and NEW individually, and that this contact with the State of Illinois was sufficient to confer jurisdiction over them in the present cause of action arising from the Letter agreement, since the Letter and the Lease were, in essence, one transaction and could be viewed as such for purposes of jurisdiction. We agree.

In Illinois, a court’s exercise of jurisdiction over a nonresident corporation not licensed in Illinois may be founded upon (a) the fact that the corporation has been found to be “doing business” within the State, or (b) compliance with the requirements of the long-arm statute. (Cook Associates, Inc. v. Lexington United Corp. (1981), 87 Ill. 2d 190, 429 N.E.2d 847.) If a foreign corporation has been found to “do business” within the State, it is amenable to the jurisdiction of Illinois courts even for causes of action not arising from the transaction of business within the State. (Cook Associates, Inc. v. Lexington United Corp., 87 Ill. 2d at 200.) In the present case the trial court ruled that the defendants were not “doing business” within the State for the purpose of asserting jurisdiction over them on causes of action not arising from a transaction of business within the State. We note, too, that the parties on appeal have restricted their arguments to the issue of whether the court’s exercise of jurisdiction pursuant to the long-arm statute, section 2 — 209(a)(1) of the Code, was proper. Consequently, we shall confine our discussion to this inquiry.

When faced with the question of whether personal jurisdiction may be exercised over a nonresident corporation, pursuant to the long-arm statute, the court must first look to the meaning of the long-arm statute and determine whether the facts alleged within the complaint indicate that the statutory requirements have been met. (Rollins v. Ellwood (1990), 141 Ill. 2d 244.) Only then should the court determine whether the assertion of jurisdiction over the nonresident is permissible under the Federal due process standard, i.e., whether the nonresident maintained “ ‘certain minimum contacts with it such that maintenance of the suit does not offend “traditional notions of fair play and substantial justice.” ’ ” (Rollins, 141 Ill. 2d at 271, quoting International Shoe Co. v. Washington (1945), 326 U.S. 310, 316, 90 L. Ed. 95, 102, 66 S. Ct. 154, 158.) The scope of the Illinois long-arm statute is not coextensive with the mandates of the Federal due process clause. (Rollins, 141 Ill. 2d at 272.) The Illinois long-arm statute may, in fact, restrict the power of Illinois courts to assert jurisdiction over a nonresident, even when the nonresident would be found to have sufficient minimum contacts under Federal law. (Rollins, 141 Ill. 2d at 274.) Thus, the more relevant inquiry is whether jurisdiction may be invoked pursuant to the Illinois long-arm statute, and the party asserting jurisdiction has the burden of proof to show that jurisdiction is proper. Kotlisky v. Kotlisky (1990), 195 Ill. App. 3d 725, 737, 552 N.E.2d 1206.

In the present case the plaintiff, GERSCO, asserted jurisdiction on the basis that WTC and NEW “transacted business” within the meaning of the long-arm statute. Thus it was its burden to show that (1) WTC and NEW transacted business within Illinois; (2) that the cause of action arose from the transaction of that business; and (3) that the assertion of personal jurisdiction was fair, just and reasonable, consistent with the due process guarantees provided by both the Illinois and Federal Constitutions. Kotlisky, 195 Ill. App. 3d 725, 522 N.E.2d 1206; Rollins, 141 Ill. 2d at 274.

A single act may constitute “transaction of business” under the long-arm statute as long as it is this act which forms the basis of plaintiff’s claim, i.e., the plaintiff must show that his claim lies “in the wake of the commercial activities by which [the] defendant [allegedly] submitted to the jurisdiction of Illinois courts.” (Financial Management Services, Inc. v. Sibilsky & Sibilsky, Inc. (1985), 130 Ill. App. 3d 826, 833, 474 N.E.2d 1297.) Factors which may be considered when determining whether the “transaction of business” prong of the statute has been met are: (1) who initiated the transaction with this State; (2) where the contract was entered into; and (3) where the contract was to be performed. (Boatmen’s Bank v. Adams (1989), 191 Ill. App. 3d 176, 186, 547 N.E.2d 742.) To constitute “transaction of business” such that a nonresident will be subjected to the jurisdiction of Illinois courts, the nonresident defendant must have voluntarily sought the benefits and protections of the laws of this State. Brainerd v. Balish (1987), 164 Ill. App. 3d 836, 518 N.E.2d 317.

In the present case there appears to be no question that the Trust has sufficient contacts with Illinois, via the Lease agreement with Chicago Railroad, to subject it to the jurisdiction of Illinois courts, at least with respect to that Lease transaction. As plaintiff GERSCO points out, the Trust was the owner of the locomotives which were delivered to Chicago Railroad in Chicago; the locomotives were used within this State; the Lease payments were made from Illinois to the Trust, generating gross income to the Trust; and it was written into the Lease agreement that the Lease was to be construed in accordance with Illinois law, whereby the Trust took advantage of the benefits and protections of the laws of this State. (See Connelly v. Uniroyal, Inc. (1979), 75 Ill. 2d 393, 389 N.E.2d 155; Gray v. American Radiator & Standard Sanitary Corp. (1961), 22 Ill. 2d 432, 176 N.E.2d 761.) The question now is whether the beneficiaries of the trust, WTC and NEW, also have sufficient contacts with this State by virtue of the Trust, making them amenable to the jurisdiction of Illinois courts, not with regard to the Lease agreement, itself, but with regard to the related Letter agreement, which was entered into by WTC and NEW, in their individual capacities, with NACC. We think it does.

It seems clear, as the trial court found, that the Letter agreement, although memorialized after the formation of the Trust and the negotiation of the Lease, was actually entered into by WTC and NEW as part and parcel of one entire transaction, which consisted of the purchase and lease of certain locomotive equipment, as well as an agreement concerning their disposal or remarketing at the termination of the initial 15-year leasing period. We believe that, under these circumstances, it is fair, just and reasonable to consider WTC and NEW as the alter egos of the Trust for jurisdictional purposes and to hold that the contacts of the Trust may be attributable to WTC and NEW, individually, at least with respect to the transaction, which includes both the Lease and the Letter agreement.

Having found that the contacts of the Trust were attributable to the defendants, we further find that these contacts satisfy the minimum contacts needed so as not to offend traditional notions of fair play and substantial justice, in keeping with the Federal due process guarantee.

The order of the circuit court of Cook County, finding that it could exercise personal jurisdiction over the defendants, Wilmington Trust Company and National Bank of Washington, is hereby affirmed.

Affirmed.

LORENZ, RJ., and GORDON, J., concur.