author: PRESIDING JUSTICE McCULLOUGH

text:
    UNIVERSITY OF ILLINOIS, Appellee, v. THE INDUSTRIAL COMMISSION et al. (Robert Powers, Appellant).
    First District (Industrial Commission Division)
    No. 1—91—1567WC
    Opinion filed July 10, 1992.

      Thomas G. King, of Chicago, for appellant.
    Seyfarth, Shaw, Fairweather & Geraldson, of Chicago (Julie A. Garrison, of counsel), for appellee.
   PRESIDING JUSTICE McCULLOUGH

delivered the opinion of the court:

This is an appeal by the claimant, Robert W. Powers, from the judgment of the circuit court of Cook County confirming on judicial review the decision of the Industrial Commission of Illinois (Commission) with regard to claims for temporary total disability benefits (TTD) pursuant to sections 19(b — 1) and 8(b) of the Workers’ Compensation Act (Act) (Ill. Rev. Stat. 1985, ch. 48, pars. 138.19(b — 1), 138.8(b)) and reimbursement of necessary and reasonable medical bills pursuant to section 8(a) of the Act (Ill. Rev. Stat. 1985, ch. 48, par. 138.8(a)). The respondent employer in this case is the University of Illinois. The issues presented for review are as follows: (1) whether the Commission’s determination that the report of Drs. Herbert White and Stephan Hessl was inadmissible was an abuse of discretion; (2) whether the finding of the Commission, affirming the arbitrator’s finding that claimant was not temporarily and totally disabled subsequent to February 12, 1986, is against the manifest weight of the evidence; (3) whether the finding of the Commission, affirming the arbitrator’s finding that medical expenses in the amount of $2,861 were not reasonable and necessary was against the manifest weight of the evidence; (4) whether the Commission erred in refusing to allow oral argument after the second remand by the circuit court; and (5) whether the circuit court erred in remanding the cause to the arbitrator for the limited purpose of introducing additional evidence.

On March 11, 1986, claimant filed an application for adjudication of claim alleging accidental injuries arising out of and in the course of his employment on February 3, 1986. On October 3, 1986, he filed the section 19(b — 1) petition. Following a hearing conducted on November 3 and 10, 1986, the arbitrator found the claimant was entitled to receive from respondent $494.67 per week for 366/7 weeks for TTD and the claimant was entitled to receive from respondent $2,861 for necessary first aid, medical, surgical, and hospital services. The decision was affirmed by the Commission on March 25,1987.

On judicial review taken by respondent (Cook County case No. 87 — L—50412), the circuit court remanded the cause to the Commission for the limited purpose of allowing respondent the opportunity to present rebuttal evidence with regard to claimant’s work duties. On October 27, 1987, the arbitrator conducted an additional hearing. At that hearing, the arbitrator heard only the testimony of Frank W. Krejnik, the general foreman. Krejnik testified concerning the work claimant was performing at the time he attempted to return to work in May 1986. On October 29, 1987, the arbitrator issued a memorandum of decision modifying the earlier decision and finding claimant was temporarily totally disabled for five-sevenths of a week.

On November 25, 1987, claimant filed a petition for review of the arbitrator’s decision with the Commission. On May 10, 1988, the cause was submitted on the record and proofs were closed. On June 7, 1988, claimant filed a request that the Commission reopen proofs to allow for the consideration of the February 13, 1987, medical report of White and Hessl. On November 28, 1988, the Commission denied the request to reopen proofs. On March 28, 1989, the Commission vacated the October 29, 1987, decision of the arbitrator because the arbitrator acted without the authority of the Commission or the circuit court to readjudicate the matter. Claimant’s petition for review was dismissed and the complete record was certified to the circuit court.

On May 19, 1989, the circuit court set aside the Commission’s March 28, 1989, decision and remanded the cause for consideration of Krejnik’s testimony. On remand, the Commission’s decision of February 9, 1990, affirmed the October 29, 1987, decision of the arbitrator. The opinion of the Commission also noted that claimant filed a motion to reconsider the denial of reopening proofs on July 7, 1989, which motion was denied on July 11, 1989, following a hearing. Claimant’s petition for judicial review by the circuit court was docketed as Cook County case No. 90 — L—50265. On August 9, 1990, case No. 90 — L— 50265 was consolidated with case No. 87 — L—50412.

For purposes of our decision, the first issue is whether the circuit court was correct in its first remand order, in allowing respondent to present rebuttal evidence with regard to claimant’s work duties. If there was no error at the first arbitration hearing, the next issue is whether the first decision of the Commission, that of March 25, 1987, is against the manifest weight of the evidence. If not, it must be confirmed.

Section 19(f)(2) of the Act provided in part:

“The court may confirm or set aside the decision of the Commission. If the decision is set aside and the facts found in the proceedings before the Commission are sufficient, the court may enter such decision as is justified by law, or may remand the cause to the Commission for further proceedings and may state the questions requiring further hearing, and give such other instructions as may be proper.” (Ill. Rev. Stat. 1985, ch. 48, par. 138.19(f)(2).)

Pursuant to section 19(f)(2), the trial court did have the authority to remand for “questions requiring further hearing.” Here, in remanding, it was necessary to find the arbitrator abused his discretion in denying the respondent a continuance.

The arbitrator may grant a continuance under section 19(b— 1) if material is discovered at the hearing which has not been previously disclosed. Implicit in the circuit court remand for additional evidence is the finding that the arbitrator erred by failing to grant the continuance. We hold the remand by the circuit court to allow the respondent to place the testimony of Krejnik into evidence before the arbitrator was improper.

Claimant testified on direct examination before the arbitrator on November 3, 1986. The cause was continued to November 10, 1986, at which hearing claimant’s testimony continued, including cross-examination. Section 19(b — 1) of the Act requires the respondent to file a written response to include “the name and address *** of each witness *** upon whom the [respondent] will rely to support his allegations.” (Ill. Rev. Stat. 1985, ch. 48, par. 138.19(b — 1).) Respondent failed to designate any witnesses in its response to claimant’s section 19(b — 1) petition.

The respondent should also have been aware that the evidence could not be presented before the Commission on review. (See 50 Ill. Adm. Code §7020.80(b)(4)(C) (Supp. 1986) (as amended Oct. 15, 1985).) Indeed, the respondent, in its statement of exception/addition to the Commission, recognized that the Commission does not generally consider such evidence. Respondent now argues that the evidence was necessitated by the disclaiming of time records by claimant on cross-examination. According to respondent, this was a surprise. However, the request for continuance made to the arbitrator was as follows:

“[Respondent’s Attorney]: Your Honor, Respondent would also either like a continuance to present testimony as to what the petitioner’s job duties were at the University of Illinois or because of the nature and the fact that this is a 19(b — 1), we would ask for leave from the Industrial Commission to present that evidence on review should it be necessary.
THE ARBITRATOR: It may be presented on review; but as far as this case is concerned, it’s closed. Your proposed findings are due one week from today.”

The request does not disclose any surprise on the part of respondent and, in any event, the failure to anticipate the testimony and witnesses necessary to present one’s case is not the same type of “surprise” as being confronted with newly discovered evidence. The respondent had one week between arbitration hearings to prepare a response to a claimant who had been testifying contrary to what respondent understood the facts to be. Nothing was done.

In its statement of exceptions to the Commission, respondent makes the conclusion that in other areas claimant has “shown a propensity for testifying contrary to what the actual records show.” This is the sole reason put forth by the respondent to present additional evidence. Respondent does not assert the arbitrator erred in his ruling, nor does the record reveal what the new evidence would show. This is not a showing of “good cause” as set forth in section 7020.80(b)(3)(A)(iii) of title 50 of the Illinois Administrative Code. 50 Ill. Adm. Code §7020.80(b)(3)(A)(iii) (Supp. 1986) (as amended Oct. 15, 1985).

In summary, the arbitrator did not err in refusing the continuance for the following reasons:

(1) Section 19(b — 1) requires the respondent, within 15 days after receipt of notice that a petition was filed, to file a written response to each claim, copies of reports, records, documents and affidavits in its possession or demanded by subpoena and the name and address of witnesses on whom the respondent will rely in support of its response.
(2) The testimony of the claimant was given on November 3, 1986. The cause was continued to November 10, 1986. Respondent did nothing in the intervening week which would indicate material information was discovered which was not previously disclosed.
(3) Respondent requested alternative relief before the arbitrator, either a continuance, or an opportunity to present evidence to the Commission. The arbitrator, albeit it was not a viable alternative, granted respondent its request to present evidence to the Commission.
(4) Section 7020.80(b)(4)(C) of title 50 of the Illinois Administrative Code states: “No hearing on Review will be held by the Commission.” 50 Ill. Adm. Code §7020.80(b)(4)(C) (Supp. 1986) (as amended Oct. 15,1985).
(5) Respondent did not suggest to the arbitrator (or the Commission) what the new evidence would show. No showing of good cause was made.

Having determined that the arbitrator did not err in refusing to grant a continuance, this court need not decide whether the refusal on remand to consider the report of White and Hessl was error or whether the failure to allow oral argument following the second remand was error.

Claimant in his brief asks this court to find the first decision of the Commission was not against the manifest weight. Respondent argues the third decision of the Commission, February 9, 1990, was not against the manifest weight of the evidence.

We do not by this decision compare the Commission’s award of February 9, 1990, i.e., five-sevenths of a week TTD, to its March 25, 1987, decision awarding 366/7 weeks TTD. It is not within our province to second-guess the Commission. We first review the Commission’s decision of March 25, 1987, affirming the arbitrator’s TTD award of $494.67 per week for 366/7 weeks, plus $2,861 for necessary first aid, medical, surgical, and hospital services. We find the March 25, 1987, decision of the Commission was not against the manifest weight of the evidence.

The decisions of the arbitrator and Commission awarded as TTD lost time from work from February 3, 1986, through May 1, 1986, and from May 23, 1986, to date of hearing, November 10, 1986. Claimant testified he was injured on the job on February 3, 1986, while pushing a push truck he and another worker had loaded with large torpedo fuses. He was employed at the university as an electrician. He estimated each fuse weighed 80 to 100 pounds and they had loaded 10 or 15 on the truck. He estimated the load was in excess of 1,000 pounds. As he started pushing the truck, he felt a sharp stabbing pain in his back and a numbness in his right leg. He immediately told his partner, who finished pushing the truck. Claimant did not unload the truck and went back to the shop and sat down. He also informed his foreman. The next day he saw Dr. Clark Montgomery, a university doctor.

Montgomery’s reports indicated that on February 7, 1986, X rays and a computerized tomography (CT) scan of the lumbar spine were taken, which revealed:

“Multiple axial scams of the lumbosacral spine were obtained from L3 to SI.
FINDINGS: Bilateral spondylolysis of L5 is noted. There is 5 mm anterior subluxation of L5 on SI as seen in the sagittal reformatted views. Noted is a small herniation at the disc level between L4-L5 best seen in the soft tissue technique in box #41.”

Montgomery saw claimant on several follow-up visits. On February 7, 1986, Montgomery did not direct claimant back to work, but recommended bed rest after finding diminished left sciatica and low back pain. On February 11, 1986, claimant was treated with pain pills and released to return to work on February 12. He was also referred to Dr. John W. Shimkus. On February 18, 1986, the treatment was continued. On February 25, 1986, Montgomery’s report noted claimant was being seen by Dr. James Lambur for physical therapy. On the report, Montgomery noted claimant was not working and had not taken his return-to-work slip to his supervisor as directed even though he had been released to return to work on February 12, 1986. On March 11, 1986, Montgomery noted claimant “complained of agonizing pain while smiling” and he refused to be examined by Montgomery and would not make another appointment. Shimkus, an orthopedic surgeon, reported finding no substantial evidence of musculoskeletal injury and recommended the patient be discharged. He further stated the 57-year-old claimant had additional medical conditions which might be responsible for his back pain other than a work-related cause.

According to Lambur’s records, he first saw claimant on February 18, 1986, and examined him for low-back pain. Claimant complained of numbness and weakness in his legs, and pain across to the left side of his lower back, which he stated had gotten worse since the accident. He could not wiggle his toes on the right side.

At his appointment with Lambur on February 25, 1986, claimant continued to complain of radicular pain to the right lower extremity, although there was some improvement. The doctor advised that he remain off work, and continued a treatment plan of therapy and anti-inflammatory medication. A radiologist’s report indicated a narrowing of the L4-L5 disc space and suspicion of disc herniation and of a degenerative spurring in the lower left spine, but no fracture.

On March 18, 1986, claimant still complained to Lambur of numbness. Claimant said his condition was “75% Better.” An evaluation revealed straight leg raising to be positive on the right with reflexes being 2+ and equal. Sensory evaluation revealed diminished sensation to the right lower extremity. The possibility of lumbar fusion and dis-cectomy at the L4-L5 level if therapy failed to ameliorate his symptoms was again discussed with claimant.

The evaluation of April 8, 1986, showed claimant about 80% improved. Lambur stated that claimant was able to return to work to perform light-duty work as of May 1, 1986. All of these findings were summarized in Lambur’s report of May 5, 1986. The report also noted anti-inflammatory medication was prescribed.

On May 13, 1986, claimant told Lambur that his back bothered him. He told the doctor that since he returned to work on May 1, 1986, he had been doing heavy duty and was unable to cut cable because of back pain. According to claimant’s testimony, Lambur returned him to therapy, traction, and rest. On May 19, 1986, Lambur issued a report certifying that claimant was currently under his care for chronic and recurring low-back discomfort. His diagnosis was one of bilateral spondylolysis of L5 with a grade I spondylolisthesis. The report stated:

“It is not in Mr. Powers’ best interest to be chronically flexed and bending over cutting cable. It would be better that he engage in an occupation that requires him to be more ambulatory and walking upright, rather than any chronic position for an inordinate period of time.”

Claimant saw Lambur on June 24, 1986, who reported: “Not working since 6/2/86 or 6/3/86.” Claimant advised Lambur he was feeling better and that therapy had helped. There were complaints of dizzy spells. The final time claimant saw Lambur was September 16, 1986. The doctor’s notes for that date stated:

“States that he has some good days and some bad. States that increased activity increases his discomfort in the low back area. Pt. states that he has occasional ‘weak Spells’ which I think are more dizzy spells. He is encouraged to obtain evaluation from his family doctor. The swimming program as advised by [therapist] is encouraged to increase his flexibility and to minimize his ‘bad days’ at work.
Robert Powers explained that I was unable to justify his being off work since February. Patient became hostile and stated that he was unable to work in his opinion. I reviewed the chart for him indicating that in my opinion he was not totally disabled. Patient became very disenchanted and abruptly left the examining room without further adieu.”

At the request of Lambur, claimant was treated at the Chicagoland Orthopedic Rehabilitation Service (CORS) 44 times from February 20, 1986, through September 11, 1986, although therapy discontinued from April 29, 1986, to June 17, 1986.

Claimant was examined by Dr. Irwin T. Barnett, at the request of claimant’s attorney, on July 10, 1986. Barnett’s diagnosis was (1) residuals of a low-back injury with bilateral nerve root irritation; (2) flattening of the fourth lumbar disc space; and (3) defection in the in-terarticular region of the fifth lumbar vertebra (pars interarticularis). The Ely sign being positive bilaterally indicated lumbosacral disease. The straight leg raising test being positive to 50 degrees on the right and 60 degrees on the left (compared to 90 degrees being normal) indicated nerve root irritation in both lower extremities. The LaSegue sign was positive bilaterally and the Achilles and patellar reflexes were hyperactive bilaterally, both indicating nerve root irritation. The atrophy of the left thigh was due to favoring of the extremity. There was tenderness over the lower lumbar spine.

Dr. Ronald P. Pawl, a neurosurgeon, saw claimant for the first time on July 29, 1986, at the request of Montgomery. Pawl’s report stated:

“A detailed neurologic examination did not disclose any evidence of compromise of the central or peripheral nervous system. Deep tendon reflexes were symmetrical and active and there was no loss of strength in any of the muscle groups of the lower extremities and the range of motion of the joints of the extremities of the spinal column was normal. There was no specific area of palpable tenderness in the lower back. I discussed his exercise program with him and it is apparent that he is not exercising at a vigorous rate.
Based upon the unusual complaints surrounding Mr. Powers’ back pain and the possibility of a herniated disc based on the CT scan, I think that he should undergo not only myelographic investigation with post-myelographic CT scanning but also an evaluation by a comprehensive pain treatment center team. If there is a significant organic stenosis of the spinal canal causing compromise of the nerve roots, then some form of intervention or restriction of activities may be necessary. On the other hand, if his evaluation by the chronic pain management team indicates that he has a chronic pain syndrome then rehabilitation should proceed along non-surgical lines especially in view of his normal neurologic examination and lack of root entrapment signs.”

Petitioner was seen by Dr. Robert A. Miller in October 1986. Miller found that claimant had a spondylolysis with spondylolisthesis and that there was evidence of a slightly herniated disc at L4-L5. Miller’s report dated October 17, 1986, stated that claimant continued

“to have mechanical low back pain despite external support. He is currently unable to return to his previous occupation. Physical exam revealed a mild amount of paraspinal muscle spasm and back tenderness with a limitation of range of motion of the low back. His range of motion measured 75 degrees [in] forward flexion, backward flexion approximately 5 degrees and lateral flexion of 15 degrees bilaterally. Ely and Gaensler tests are positive and he has a mildly positive straight leg raising test at about 75 degrees bilaterally. X rays confirmed the presence of a disc space narrowing at L4-L5 level indicating degenerative disc disease.”

Claimant testified he had not worked since May 23, 1986. Claimant presented evidence of medical bills totalling $2,861. These exhibits were admitted over respondent’s objections.

The arbitrator awarded TTD from February 3, 1986, through May 1, 1986, and from May 23, 1986, to the date of hearing, November 10, 1986. The arbitrator found Montgomery’s impression was a “herniation of lumbar discs, L4-5”; Pawl’s report was evidence “suggestive of a herniated disc with possible root entrapment”; Miller indicated “a herniated disc at L4-L5 and spondylolysis with spondylolisthesis” and “currently unable to return to his previous occupation”; and Lam-bur diagnosed “a disc herniation at L-4 and L-5 with bilateral spondylolysis at L-5.” The March 25, 1987, decision of the Commission noted that Lambur’s September 16, 1986, statement to claimant that he was unable to justify claimant being off work since February 1986 was against all other medical evidence and adopted all the findings which were included in the arbitrator’s November 20, 1986, decision. The arbitrator’s decision found total reasonable and necessary medical, surgical, and hospital bills or services to be $2,861 and that claimant was entitled to TTD of 366/7 weeks from February 3 to November 10, 1986.

TTD involves that temporary period immediately following an accident during which the injured employee is totally incapacitated by reason of the injury, and it is considered temporary in the sense that the disabling condition exists until the employee is as far restored as the injury’s permanent character will permit. (Mt. Olive Coal Co. v. Industrial Comm’n (1920), 295 Ill. 429, 431, 129 N.E. 103, 104.) In order to recover TTD benefits, a claimant must prove, by a preponderance of the evidence, that the injuries arose out of and in the course of his employment (Lyons v. Industrial Comm’n (1983), 96 Ill. 2d 198, 203, 449 N.E.2d 1323, 1325), and that claimant had a resultant incapacity to work. (See Pemble v. Industrial Comm’n (1989), 181 Ill. App. 3d 409, 416, 536 N.E.2d 1349, 1354.) Claimant must prove not only that he did not work, but that he was unable to work. Gallentine v. Industrial Comm’n (1990), 201 Ill. App. 3d 880, 887, 559 N.E.2d 526, 531; Palmer House v. Industrial Comm’n (1990), 200 Ill. App. 3d 558, 564, 558 N.E.2d 285, 289.

Under section 8(a) of the Act, an employee is only entitled to recover reasonable medical expenses which are causally related to the accident. The award should only reflect those services which were determined to be required to diagnose, relieve, or cure the effects of claimant’s injury. (Palmer House, 200 Ill. App. 3d at 565, 558 N.E.2d at 290.) What is reasonable and necessary is a question of fact to be determined on a case-by-case basis. The award of $2,861 medical expenses was not against the manifest weight of the evidence.

Both parties agree that it is the Commission’s function to determine facts and draw reasonable inferences from the competent evidence in the record, while the reviewing court is limited to a consideration of whether the Commission’s findings are against the manifest weight of the evidence. (Granite City Steel Co. v. Industrial Comm’n (1983), 97 Ill. 2d 402, 406, 454 N.E.2d 1011, 1013; Scott v. Industrial Comm’n (1979), 76 Ill. 2d 183, 184-85, 390 N.E.2d 906, 907; Overland Construction Co. v. Industrial Comm’n (1967), 37 Ill. 2d 525, 531, 229 N.E.2d 500, 504.) Merely because different inferences could be drawn from the conflicting evidence does not justify the reviewing court in overturning the Commission’s decision. Niles Police Department v. Industrial Comm’n (1981), 83 Ill. 2d 528, 533-34, 416 N.E.2d 243, 245.

Because the arbitrator did not err in his rulings on November 10, 1986, the testimony of Krejnik is not considered in determining the appropriateness of the TTD award. If the arbitrator and Commission had second thoughts about the credibility of claimant, that question will be a part of future proceedings in this case.

Based on the evidence summarized above, the findings of the March 25, 1987, Commission decision are not contrary to the manifest weight of the evidence. Accordingly, the judgment of the circuit court confirming the February 9, 1990, Commission decision is reversed, and the March 25, 1987, Commission decision is reinstated and confirmed.

Circuit court reversed; March 25, 1987, decision of the Illinois Industrial Commission reinstated and confirmed.

RAKOWSKI, WOODWARD, STOUDER and H. LEWIS, JJ., concur.


source: Caselaw Access Project

author: JUSTICE LORENZ

license: Public Domain

text:
    HONG SIK IN, Plaintiff-Appellant, v. KIYOKO CHENG et al., Defendants (Affiliated Bank et al., Defendants-Appellees).
    First District (5th Division)
    No. 1—90—0516
    Opinion filed November 8, 1991.
    Modified on denial of rehearing July 31, 1992.

      R.S. Maione, of R.S. Maione & Associates, of Chicago, for appellant.
    Susan E. Woods and Stanley M. Cahn, both of Chicago, for appellee Affiliated Bank, North Shore National.
    Stotis, Chionis, Craven & Baird, of Chicago, for appellee Hicks, Burton & Associates, Ltd.
   JUSTICE LORENZ

delivered the opinion of the court:

Plaintiff, Hong Sik In, filed an action to quiet title to resolve a dispute over the parties’ competing rights in a parcel of commercial property. At trial, the parties entered an agreed statement of facts pursuant to which the trial judge, after assessing the various transactions through which the parties claimed their rights, held that plaintiff had no real property rights in the subject property. Therefore, the trial judge dismissed defendants-appellees Affiliated Bank, North Shore National and Hicks, Burton & Associates, Ltd. The trial judge also entered a finding under Supreme Court Rule 304(a) (134 Ill. 2d R. 304(a)), and further ordered that the plaintiff could pursue a claim for money damages in the law division against the remaining defendant, Kiyoko Cheng. Plaintiff appealed. In our initial opinion we held that plaintiff, who acquired her rights through one of the beneficiaries of the land trust, could not prevail over the rights of a holder of a subsequently acquired interest in the real property. In reaching our disposition, we refrained from applying an exception to the rule which precludes beneficiaries of a land trust from effectively conveying the real property held in the trust. We have reconsidered this case in light of the inequities to plaintiff and the peculiar facts contained in the record. We now believe that the proper course is to reverse and remand this case for further proceedings.

Reversed and remanded.

We begin with a statement of the facts as they appeared in our initial opinion. The subject property is located at 3342-44 West Foster Avenue in Chicago. In 1976, defendant Kiyoko Cheng and her husband, as legal title holders, conveyed the subject property to an Illinois land trust, naming the La Salle National Bank as trustee and reserving to themselves the sole beneficial interest in the trust. The trust agreement provided, among other things, that the trustee had full power and authority to sell and convey the trust property.

In 1981, Kiyoko Cheng as seller and plaintiff (Hong Sik In) as buyer entered into an installment contract for the sale of the property for $100,000. Cheng was represented by an attorney, Philip Igoe. The plaintiff, who had just arrived in this country from Korea, had someone assist her but she did not know if he was an attorney. The signed installment contract did not account for the interests of Cheng’s husband or their trustee.

The installment contract was recorded in the office of the Cook County recorder of deeds on July 28, 1981. The contract required plaintiff to pay Cheng $30,000 as down payment, $771 per month for two years, and the balance of $70,000 on or before September 1, 1984. Plaintiff paid the $30,000 down payment.

In 1982, Cheng and plaintiff drafted a novation to the contract because Cheng was “in need of additional money which [was] not presently due.” The novation provided that, if plaintiff paid another $20,000 toward the balance, the due date for the final payment would be extended beyond 1984. Plaintiff paid the $20,000. However, the novation was not recorded. In the trial court, two versions of the novation were produced thereby creating a factual dispute whether the due date was extended to 1986 or 1991.

In 1986, plaintiff leased the premises to Lee Shin (tenant), who renovated the property into a Korean restaurant with an adjacent apartment. Tenant continued to pay rent to the plaintiff until the time of this litigation.

Defendant-appellee Hicks, Burton & Associates, Ltd. (Hicks Corporation), a real estate investment company, consisted of three principals: George Hicks, Ben Burton, and Darryl Wilkes. The three men incorporated their business in 1986 with the assistance of the above-mentioned attorney, Philip Igoe.

In 1987, Hicks Corporation arranged for the purchase of the subject property from Cheng for $60,000. Even though George Hicks, Igoe and Cheng were all social acquaintances, in his deposition Hicks denied that he knew that Igoe represented Cheng in her 1981 installment contract with plaintiff. Hicks testified that he approached Cheng about buying the property and she proposed a $60,000 sale price. Cheng also told Hicks that she had sold the property to the plaintiff by an installment contract but plaintiff was not making the required payments. Cheng explained to Hicks that she could not afford to foreclose on the contract and wanted to sell the property quickly. She gave Hicks a copy of the installment contract and the novation. After reading the novation, Hicks concluded that plaintiff’s contract had expired because the original due date had passed and because the novation was not enforceable.

However, Hicks further testified that he spoke with the plaintiff and the tenant prior to purchasing the property from Cheng. In his deposition, Hicks admitted that plaintiff told him that she owned the building. Plaintiff’s tenant also told him that the plaintiff owned the building and that the building was paid for.

Nonetheless, Hicks contacted Igoe to discuss the prospect of Hicks Corporation purchasing the property. Igoe told him that he had represented Cheng in the past; that another party (plaintiff) claimed an interest in the property; but that Hicks Corporation could still obtain possession to the property. Hicks admitted that while planning for the purchase of the property he and his partners considered the possible litigation costs in view of plaintiff’s adverse claim.

Hicks next contacted defendant-appellee Affiliated Bank, North Shore National (Affiliated Bank). Hicks testified that he gave Joan Bas-sak, an officer with Affiliated Bank, a copy of the installment contract and novation that he received from Cheng. Affiliated Bank agreed to extend to Hicks Corporation a $45,000 mortgage loan for the purchase of the property.

Igoe supervised the closing on the property and another attorney from Igoe’s office suite represented Cheng. Hicks Corporation made an $18,000 down payment to Cheng and paid the balance of tlie purchase price with a check from Affiliated Bank. La Salle National Bank as trustee of the 1976 Illinois land trust then conveyed the property to another trust with Affiliated Bank as trustee and with Hicks Corporation as beneficiary. Igoe was designated legal counsel for Affiliated Bank as trustee. The trust agreement provided, however, that the beneficiary had full power and authority to sell and convey the trust property.

After completing the transaction, Hicks Corporation served a five-day notice on plaintiff’s tenant and then filed an eviction action based on the tenant’s failure to pay Hicks Corporation rent. Plaintiff filed motions to enjoin the eviction action and to quiet title to the property. Then, Hicks Corporation negotiated a contract with a third party for the sale of the property for $95,000. Plaintiff, in turn, filed motions requesting the court to enjoin the sale of the property and to remove Igoe as attorney for both Hicks Corporation and Affiliated Bank as trustee. Igoe withdrew as counsel in both capacities.

In March 1988, Affiliated Bank as mortgagor filed a motion to dismiss plaintiff’s motion to quiet title. There is no indication that Hicks Corporation joined this motion. The motion argued that the recordation of the 1981 installment contract between Cheng and plaintiff was “wild” because it was outside the chain of title; moreover, plaintiff’s rights under the installment contract terminated in 1984 because the (1991) novation was not recorded. On July 28, 1988, Judge Roger Kiley denied the motion.

Affiliated Bank, as mortgagor, filed its answer and affirmative defense to plaintiff’s motion to quiet title on August 30. Following Judge Kiley’s retirement, the case was reassigned to Judge Reynolds.

On April 20, 1989, Hicks Corporation filed a motion for summary judgment arguing that plaintiff violated her contract with Cheng because, among other things, plaintiff was late in her periodic payments and wrote checks which were returned marked “not sufficient funds.” Judge Reynolds denied this motion and continued the case.

In view of trial, the parties submitted a statement of “Agreed Facts” to the court. The stipulation recognized the 1981 installment contract between Cheng and plaintiff and the existence of both versions of a novation (neither of which was recorded). The stipulation also recognized the 1987 sale to Hicks Corporation. It stated further that Hicks Corporation “was aware” that the plaintiff claimed an interest in the property and that plaintiff had a tenant on the premises, but that if George Hicks were called to testify, he would state that he believed plaintiff’s interest in the property had expired in 1986. If Joan Bassak of Affiliated Bank were called to testify, she would state that, although the bank was aware of the installment contract, “neither she, nor the bank, had notice of the novations.”

The stipulation framed two issues: (1) whether the 1991 novation was a binding contract between plaintiff and Cheng that acted to extend the installment contract; and (2) whether the 1991 novation, if valid, is enforceable against Hicks Corporation and/or Affiliated Bank. Two footnotes appear in the stipulation. The first footnote provided that plaintiff paid a $30,000 down payment and another $20,000 under a “Novation Agreement” and if plaintiff were called as a witness she would state that she made all payments under the installment contract prior to and after the purchase of the property by Hicks Corporation. The second footnote provided that neither Cheng nor Hicks Corporation sent the plaintiff a notice of intent to forfeit the installment contract. Finally, the stipulation did not mention the existence of the 1976 Illinois land trust.

After reading the stipulation, Judge Reynolds commented in court:

“I will admit to the attorneys that my heart goes out to [plaintiff], and I think that she has been very badly treated, but I don’t think that she has any claim on the property now according to the recorder’s office. Regarding notice by inquiry, I don’t think that — since she was never an owner, I don’t think that Mr. Hicks had any duty to find out who she was.”

Judge Reynolds then entered the order dismissing Hicks Corporation and Affiliated Bank. The first three paragraphs of the order recount the agreed facts. The paragraphs that follow specifically provided:

“4. This court finds that [plaintiff] has no equitable interest in the subject property.
5. The court farther finds that [plaintiff] has no equitable interest superior to the Affiliated Bank, North Shore.
6. That Hicks, Burton & Associates and Affiliated Bank, North Shore are deemed bona fide purchasers for value based on the fact that neither version of the extension agreement was recorded, thereby extinguishing [plaintiff’s] equitable interest in the property.
7. Consequently, the court finds that the interest of Hicks, Burton & Associates and Affiliated Bank, North Shore passes free and clear of any interest of [plaintiff].”

The court denied plaintiff’s post-trial motion for reconsideration but stayed the effect of the order pending appeal, thereby halting a disposition of the property.

In their appellate briefs, the parties argued extensively whether Hicks Corporation and Affiliated Bank were bona fide purchasers who took the property in good faith, for value, and without notice of the plaintiff’s rights in the property.

Opinion

It has been long established that the trustee of an Illinois land trust holds all rights to the real property, both legal and equitable, while a beneficiary of an Illinois land trust holds rights in personal property only. (Chicago Federal Savings & Loan Association v. Cacciatore (1962), 25 Ill. 2d 535, 185 N.E.2d 670.) Therefore, as a general rule, courts have maintained that a beneficiary cannot convey an interest in the real property held by the trust. The courts, however, began carving out exceptions to this general rule. In our initial opinion, we cited Rizakos v. Kekos (1977), 56 Ill. App. 3d 404, 371 N.E.2d 896, which provided that a purchaser may successfully enforce a real estate contract entered into by a beneficiary of the land trust. The Rizakos court limited its rationale to those cases in which the trust agreement vested in the beneficiary the sole right to direct the trustee to convey title, and where the real estate contract contained a promise to convey title or “cause title to be conveyed” and a promise to deliver a “trustees deed.” Rizakos, 56 Ill. App. 3d at 406, 371 N.E.2d at 898.

After Rizakos, the courts expanded the circumstances pursuant to which a beneficiary could effectively convey the real property. One court stated:

“The trend of decisions in Illinois appears to be expanding the authority of beneficiaries to contract to sell real estate owned in a land trust, particularly where enforcement of the contract is sought by a purchaser who was not informed by the seller that his status was that of beneficiary under a land trust.” (Farley v. Roosevelt Memorial Hospital (1978), 67 Ill. App. 3d 700, 706, 384 N.E.2d 1352, 1358.)

We are now relying on this trend in deciding to reverse and remand this case. We are also mindful of the present record, which shows that the plaintiff was “very badly treated.”

In Farley, the plaintiff sought to enforce a real estate contract executed by the beneficiary of the land trust. The appellate court held that the contract was enforceable even though it did not contain a promise to deliver a “trustees deed.” The court explained that the beneficiary should not obtain an advantage because the language was omitted. (Farley, 67 Ill. App. 3d 700, 384 N.E.2d 1352.) Here, we also are persuaded that the parties (appellees herein) should not be able to obtain an advantage because the real estate contract did not contain the language “trustees deed” or “cause title to be conveyed.” We believe that this construction of the contract is appropriate, especially in light of the fact that Philip Igoe, who later represented the Hicks Corporation, was responsible for the installment contract between plaintiff and the Chengs.

In the same vein, we are persuaded that the parties should not be able to take advantage of the language in the 1976 trust agreement which vested power in the trustee, La Salle National Bank, to convey title. We note that plaintiff was not informed that the property was held in trust and therefore did not have an opportunity to check the language in the trust agreement. Nor is there any evidence that La Salle National Bank as trustee would have opposed the sale to plaintiff. Therefore, we do not believe that the trust agreement precludes enforcement of the real estate contract.

Finally, we are aware that Mr. Cheng, as co-beneficiary, did not sign the real estate contract. As a rule, when a land trust has two or more beneficiaries, a contract to sell the trust property is not enforceable unless all such beneficiaries consent to the sale. (Emerich v. Leviton (1983), 117 Ill. App. 3d 832, 454 N.E.2d 45.) From the evidence presented, we believe that Mr. Cheng fully consented to the sale. In sum, we believe that plaintiff acquired a right in the real property pursuant to the real estate contract.

The issue remains as to the priority of rights between plaintiff and appellees as subsequent purchasers. Having determined that plaintiff had an interest in the real property, the rationale of the trial court finding in favor of appellees must fail. The trial court stated “since she was never an owner, I don’t think that Mr. Hicks had any duty to find out who she was.” We hold now that the appellees did have a duty to find out who she was. The appellees, in turn, have presented various arguments providing that they have priority as bona fide purchasers. It is not necessary that we address all of these arguments because they also are premised upon the view that plaintiff did not have rights in the real property. We add that there is strong evidence, aside from any questions concerning the novations, that appellees had actual notice of plaintiff’s claim against the real property. In sum, appellees do not have priority because plaintiff had a right in the real property and the appellees were not bona fide purchasers.

In closing, we again voice our agreement with the trial judge, who stated that the plaintiff was “very badly treated.” From the record presented it appears that attorney Philip Igoe may have transgressed upon the rules of ethics governing attorneys by his dual role in representing the Chengs and subsequently the Hicks Corporation in its purchase of the subject property. We leave the determination of whether there were violations of the rules of ethics governing attorneys to the Attorney Registration and Disciplinary Commission.

Reversed and remanded.

McNULTY, P.J., and GORDON, J., concur.


author: JUSTICE McNAMARA

text:
    HELLER EQUITY CAPITAL CORPORATION, Plaintiff-Appellee, v. CLEM ENVIRONMENTAL CORPORATION, Defendant-Appellant.
    First District (6th Division)
    No. 1—91—2778
    Opinion filed July 10, 1992.
    Thomas R. Mulroy, Susan B. Cohen, and Debbie L. Moeckler, all of Jenner & Block, of Chicago, for appellant.

      Terry M. Grimm, Paul P. Biebel, Jr., Timothy J. Rivelli, and Julie A. Bauer, all of Winston & Strawn, of Chicago, for appellee.
   JUSTICE McNAMARA

delivered the opinion of the court:

Plaintiff, Heller Equity Capital Corporation (HECC), as assignee of Heller Financial, Inc. (Heller), filed an action in the circuit court of Cook County seeking: (1) a declaratory judgment that a letter agreement (agreement) entered into between Heller and defendant, Clem Environmental Corporation, in connection with certain financing Heller provided to defendant was valid and enforceable; and (2) specific performance of the agreement requiring defendant to issue 2,000 shares of preferred stock to HECC. Defendant pled an affirmative defense maintaining that the letter agreement was void and unenforceable because performance under the agreement would violate the Bank Holding Company Act of 1956 as amended (BHC Act) (12 U.S.C. §1843 (1988)), and later moved to stay the proceedings pending referral to the Federal Reserve Board (FRB).

The trial court struck defendant’s affirmative defenses and denied defendant’s motion for a stay of proceedings pending referral to the FRB. Summary judgment was granted in favor of HECC, and the judge ordered specific performance for the issuance of the stock. On appeal, defendant challenges each ruling made by the trial court.

We adduce the following factual background from the affidavits, pleadings, and documents filed. HECC, an affiliate of Heller, is a commercial finance small business investment company (SBIC) licensed under the Small Business Investment Act (SBI Act). Subsequent to the transaction at issue, Heller became a commercial finance subsidiary of Fuji Bank, a registered bank holding company. Defendant is a small, closely held corporation engaged in the manufacture of ben-tonite fibermat liners used for landfills. Heller and defendant had extensive financial dealings with each other prior to the execution of this agreement.

It is undisputed that on December 28, 1982, as partial consideration for a loan made by Heller to finance defendant’s business, the parties entered into an agreement which provided for: (1) the sale of 1,000 shares of preferred stock to Heller for a purchase price of $1,000; (2) granted Heller an irrevocable option to purchase an additional 1,000 shares of preferred stock for a purchase price of $1,000 to remain in effect for five years; (3) the amendment of defendant’s articles of incorporation and bylaws to authorize the issuance of the preferred stock; and (4) the conversion of the preferred stock into common stock, which, upon issuance thereof, shall equal 25% of the issued common stock of the company any time subsequent to January 1, 1986. The agreement also provided that it would be binding upon the successors and assigns of defendant and Heller, and did not require the consent of the parties to transfer those rights.

On February 25, 1986, defendant sought to borrow an additional $100,000 from Heller. A second agreement was executed in which Heller exercised its option to purchase the additional shares of preferred stock, and the parties agreed to change the date after which the preferred stock could be converted to common stock from January 1, 1986, to January 1, 1987. At the time of the second agreement, defendant acknowledged that its liabilities under the loan agreement equalled $1,665,053.

On June 26, 1990, Heller contributed its rights to the convertible preferred stock by way of a capital contribution to HECC. The record reveals that, pursuant to an informal conversation between representatives from Heller and the Small Business Administration (SBA), such a transfer was permissible so long as HECC did not try to count the shares as capital for purposes of leverage until the shares were actually sold for cash. Defendant meets the requirements of a small business concern under the SBI Act. Despite numerous requests from both Heller and later from HECC, defendant refused to issue the stock.

As its first affirmative defense in this cause, defendant argued that the BHC Act prohibits a direct or indirect subsidiary of a bank holding company from acquiring more than 5% of the voting shares of a company, or more than 25% of the total equity or total outstanding shares of a company. (12 U.S.C. §1843(c)(6) (1988); 12 C.F.R. §§225.22(c)(5), 225.143 (1990).) Defendant maintained that on January 1, 1987, the preferred stock became automatically convertible to common stock representing 50% of defendant’s then outstanding voting common stock, which is impermissible under section 4 of the BHC Act. Secondly, defendant alleged that the agreement violated the SBI Act, which prohibits a small business investment company from owning 50% or more of the outstanding voting securities of a small business concern.

On May 25, 1990, defendant contacted the FRB and requested an investigation of whether a demand by Heller that defendant issue preferred stock representing 50% of its equity violated the provisions of the BHC Act. On July 10, 1990, Heller responded to the FRB’s inquiry and offered two points for its consideration: (1) that Fuji Bank and new Heller management played no significant role in the transaction at issue; and (2) defendant was a qualifying small business corporation, and the rights to defendant’s preferred stock could have been structured as an SBIC investment. Heller further stated that as soon as the problem came to its attention in 1988, it attempted to negotiate in good faith with defendant to cure the problem. After defendant refused to negotiate in good faith, Heller transferred its rights to defendant’s preferred stock to its SBIC affiliate, HECC.

On December 5, 1990, defendant also requested review by the SBA of the propriety of the issuance of the stock. On December 7, 1990, defendant advised the FRB of the pendency of this lawsuit. On May 14 and June 14, 1991, defendant requested a status report of the FRB’s review of the matter. To date, defendant has received no further communication from the FRB.

On April 30, 1991, defendant filed a motion to stay these proceedings pending referral to the FRB and the SBA. In that motion, defendant contended that the FRB and the SBA were currently investigating the permissibility of the stock transfer under the BHC Act and the SBI Act. (The SBA has since informed defendant that the issuance of the 2,000 shares of stock does not violate the SBI Act so long as the preferred stock is not converted into voting stock. Defendant does not intend to appeal the SBA’s determination.)

On July 25, 1991, the trial court entered an order striking defendant’s affirmative defenses. Specifically, the trial judge concluded that: (1) the BHC Act does not expressly declare contracts in violation of the BHC Act void; (2) the FRB has exclusive jurisdiction over original BHC Act claims; (3) Heller’s assignment of its rights under the agreement to HECC cured any violation of the BHC Act; and (4) defendant would benefit if the agreement is deemed void. The trial court denied defendant’s motion for a stay pending appeal.

On appeal, defendant first argues that the court erred in striking its affirmative defense of illegality because performance of the agreement would violate the BHC Act. Defendant asserts that section 4(c)(6) of the BHC Act prohibits a bank holding company from acquiring more than 5% of the outstanding voting shares of nonbanking companies. Defendant contends that Heller made this concession in its July 10, 1990, letter to the FRB when it admitted that the issuance of the stock would create “problems” under the BHC Act. Also, the trial judge stated that “under the original matter with Walter Heller it would appear that it does violate the BHC Act.”

Defendant further contends that the fact that the BHC Act does not declare a contract in violation of the Act is irrelevant. Defendant relies upon E & B Marketing Enterprises, Inc. v. Ryan (1991), 209 Ill. App. 3d 626, 568 N.E.2d 339 (parties’ contract amounted to illegal feesplitting agreement and was therefore void), and American Buyers Club of Mt. Vernon, Illinois, Inc. v. Grayling (1977), 53 Ill. App. 3d 611, 368 N.E.2d 1057 (contract and note executed by members of buyers’ club were void as violating Regulation Z promulgated under Truth in Lending Act), as support for its position that because the agreement violates the BHC Act it is unenforceable, regardless of whether the BHC Act explicitly declares that it is void. Relatedly, defendant argues that even if the FRB has exclusive jurisdiction over BHC Act claims, defendant may still assert an alleged violation as an affirmative defense.

In Orbanco, Inc. v. Security Bank (D. Or. 1974), 371 F. Supp. 125, the United States district court determined that the FRB had primary jurisdiction to consider possible violations of the BHC Act. The Or-banco court offered the following explanation as the rationale behind investing primary jurisdiction in the FRB:

“The Board is qualified to make the economic decisions demanded by the Bank Holding Company Act. They are required to consider the public interest, the anti-competitive effects of the proposed transactions, and the convenience and needs of the community to be served. Congress intended that the technical and complex problems involved in the application of the Bank Holding Company Act to the banking industry should be resolved, at least in the first instance, by a body of experts. They know the competitive realities of the banking business. This subject is outside the conventional experience of judges.” Orbanco, 371 F. Supp. at 130.

More recently, in Centerre Bancorporation v. Kemper (E.D. Mo. 1988), 682 F. Supp. 459, a bank holding company brought an action under the BHC Act seeking to enjoin another company from acquiring additional shares of its stock. The district court again held that the FRB has exclusive jurisdiction over BHC Act violations and that the BHC Act does not expressly provide for a private cause of action for any alleged violations.

In this case, both parties agree that the FRB has exclusive jurisdiction to determine alleged violations of the statute and the regulations thereunder. On July 10, 1990, Heller sent the FRB a detailed explanation of its version of the transaction. The FRB has not contacted Heller for any additional information, or issued any warning or notice of violation of the BHC Act. Indeed, as previously stated, the FRB has not acted upon defendant’s request for investigative review of the propriety of the stock issue over the past two years, despite numerous requests by defendant for status reports.

Defendant attempts to distinguish the present case by conceding that while the FRB may have exclusive jurisdiction over claims brought pursuant to the BHC Act, exclusive jurisdiction does not apply to claims raised by way of affirmative defense. “Affirmative matter,” for purposes of avoiding the effect or of defeating the claim, is something in the nature of a defense that negates an alleged cause of action completely or refutes crucial conclusions of law or conclusions of material fact unsupported by allegations of specific fact contained in or inferred from the complaint. (Brown v. Morrison (1989), 187 Ill. App. 3d 37, 542 N.E.2d 1308.) It must, however, be something more than evidence offered to refute a well-pleaded fact in the complaint, for, as in the case of a motion under section 2 — 615 (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 615), such well-pleaded facts must be taken as true for the purposes of a motion to dismiss under section 2 — 619(a)(9) (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 619(a)(9)). Brown v. Morrison, 187 Ill. App. 3d 37, 542 N.E.2d 1308.

After examining the BHC Act and the FRB regulations, the trial court correctly concluded that any purported illegality in this agreement found by the FRB would impact Heller only, for privity existed between the FRB and Heller for any alleged violation of FRB regulations. The rules and regulations of the FRB were not promulgated to protect the third party in a contractual relationship, such as the defendant in this transaction. See Centerre Bancorporation, 682 F. Supp. 459 (BHC Act does not expressly provide for a private cause of action); Quaker City National Bank v. Hartley (S.D. Ohio 1981), 533 F. Supp. 126 (no private right of action existed under the BHC Act).

Moreover, the FRB could order the disposition of the stock in any manner it deemed appropriate, such as divesture, sale, or transfer of the asset. Assuming arguendo that the agreement was illegal, the FRB had several options available to correct the situation rather than simply voiding the agreement in its entirety. Thus, defendant’s assertion that the agreement was illegal and therefore void is purely speculative under the circumstances and cannot rightfully be advanced as an affirmative defense.

Defendant further contends that Heller’s assignment to HECC did not cure the illegality of the agreement. HECC counters defendant’s allegations by stating that issuance of the preferred shares is permissible within the express provisions of the BHC Act. Under section 4(c)(5) of the BHC Act, a bank holding company subsidiary such as Heller may acquire “shares which are of the kinds and amounts eligible for investment by national banking associations under the provisions of section 24 of [title 12].” (12 U.S.C. §1843(c)(5) (1988).) Further, pursuant to 15 U.S.C. §682(b) (1992), shares of stock in small business investment companies shall be eligible for purchase by national banks. We agree with HECC.

Any illegality in the original agreement was effectively cured by the assignment of Heller’s interest to HECC. As previously stated, the agreement explicitly permitted Heller to assign its interest without the consent of defendant. Most importantly, the SBA concluded that when Heller contributed its rights to the convertible preferred stock by way of a capital contribution to HECC, such a transfer was permissible so long as HECC did not try to convert defendant’s preferred stock into voting stock, or if the preferred stock became voting stock by operation of law. In this case, the trial court properly struck defendant’s affirmative defense, for defendant failed to prove any set of circumstances wherein it could avoid its responsibilities to deliver the preferred stock pursuant to the agreement.

Defendant next contends that the court abused its discretion in refusing to grant a stay of the proceedings until the FRB acted because all of the requirements for a stay under the primary jurisdiction doctrine have been met. Defendant maintains that the issues raised in this cause are within the unique administrative expertise of the FRB and its decision will ensure uniformity in this highly regulated area. Further, application of the primary jurisdiction doctrine is particularly compelling because an action is already pending before the FRB.

The doctrine of primary jurisdiction is concerned with promoting proper relationships between the courts and administrative agencies charged with particular regulatory duties. (Peoples Energy Corp. v. Illinois Commerce Comm’n (1986), 142 Ill. App. 3d 917, 492 N.E.2d 551.) No fixed formula exists for applying the doctrine of primary jurisdiction; rather, in every case the question is whether the reasons for the existence of the doctrine are present and whether the purposes it serves will be aided by its application in the particular litigation. Peoples Energy Corp., 142 Ill. App. 3d 917, 492 N.E.2d 551.

We are unpersuaded by defendant’s arguments that a stay of the proceedings should have been granted. Defendant has failed to demonstrate with any reasonable degree of certainty to what stage, if any, the FRB’s investigation has progressed. Indeed, defendant has failed to present any evidence that the FRB has any intention of pursuing this matter any further. As such, we cannot abide by defendant’s attempt to prolong the issuance of the preferred stock to HECC and continue to thwart the purpose of the agreement.

Defendant’s last argument posits that the trial court erred in granting summary judgment for HECC because defendant has pled a valid affirmative defense.

The purpose of summary judgment is to determine whether there are any issues of genuine material fact. (Kelman v. University of Chicago (1988), 166 Ill. App. 3d 137, 519 N.E.2d 708.) An order granting summary judgment is appropriate where the pleadings, depositions on file, together with the affidavits, if any, demonstrate there is no genuine issue as to any material fact and that the moving party is entitled to summary judgment as a matter of law. (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 1005(c).) In view of our determination that defendant failed to plead a valid affirmative defense, we find that summary judgment was properly granted.

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

Judgment affirmed.

EGAN, P.J., and RAKOWSKI, J., concur.