author: Mr. JUSTICE LEIGHTON

text:
    Hartford Accident & Indemnity Company, Plaintiff-Appellee, v. Case Foundation Company et al., Defendants-Appellants.
    (No. 56094;
    First District (2nd Division)
    February 6, 1973.

      Herrick, McNeill, McElroy & Peregrine, of Chicago, (William T. McNeill, Ray W. Fick, Jr., and Michael J. Hamblet, of counsel,) for appellant Case Foundation Co.
    Michael I. Miller, Paul T. Ruxin, and Michael A. Pope, all of Chicago, (Isham, Lincoln & Beale, of counsel,) for appellant Skidmore, Owings & Merrill.
    Leibman, Williams, Bennett, Baird & Minow, of Chicago, (David P. List, Thomas H. Morsch, and Henry L. Mason, of counsel,) for appellant Tishman Construction Co.
    John G. Poust, Jerome N. Groark, and Dwight C. Adams, all of Chicago, (Hackbert, Rooks, Pitts, Fullagar and Poust, of counsel,) for appellee.
   Mr. JUSTICE LEIGHTON

delivered the opinion of the court:

This appeal is from a declaratory judgment entered in a suit by Hartford Accident & Indemnity Company, an insurer, against its insureds Case Foundation Company; Skidmore, Owings & Merrill; Tishman Construction Corporation of Delaware; Jerry Wolman, Anne Wolman, Earl M. Foreman, Phyllis R. Foreman, J. Theodore Dailey, Maureen M. Dailey and American National Bank and Trust Company of Chicago, Trustee under its Trust No. 21631. In its complaint, Hartford alleged that it issued a policy to tire insureds; that Case, Skidmore and Tishman, claiming coverage under the policy, tendered to it the defense of a Federal suit that Jerry Wolman filed against them. Hartford prayed for a determination of the rights and obligations of the parties under the policy. The trial court ruled that Hartford did not have to defend the suit. The issue is whether this ruling was correct.

I.

On February 12, 1965, Jerry Wolman and his wife owned 85% of the land bound on the west, north and south by North Michigan Avenue, East Delaware and East Chestnut Streets in Chicago. Desiring to develop what is now the John Hancock Center, they entered into an agreement with Skidmore, Owings & Merrill for architectural and engineering services. Wolman was an entrepreneur, a land developer who had a number of business ventures. For example, either alone or with others, he owned the Georgian Towers in Maryland, the Prudential Building and other properties in the District of Columbia, the Philadelphia Eagles and an indoor sports center in Philadelphia and taxicab companies in two major cities. Wolmans investment in the John Hancock project exceeded $5,000,000. The profits he anticipated from the venture were in excess of $20,000,000.

April 20, 1965, Wolman contracted with Tishman Construction Corporation of Delaware to build the 100-story combination office and residential John Hancock Center. The cost was not to exceed $63,000,000. John Hancock Mutual Life Insurance Company agreed to provide the financing because the building would add to its prestige and financing it was consistent with sound economic considerations. On May 3, 1965, at Wolmans expense, Hartford issued its liability policy No. 83 CA 50100 which insured, among others, Wolman, Skidmore, Tishman and all contractors and subcontractors who were to work on the building. Then on July 22, 1965, Tishman entered into a subcontract with Case Foundation Company, a California corporation by which Case agreed to construct 57 concrete caissons for part of the foundation of the 100-story building. Case was to provide labor, equipment and the necessary supervision for this and related work.

On February 11, 1970, Wolman filed a complaint in the United States District Court in Chicago in which he alleged that Case, Skidmore and Tishman breached their contracts and were negligent in connection with construction of tire John Hancock Center. Case, Skidmore and Tishman tendered defense of the suit to Hartford. Hartford refused the tender but reserved its rights and filed the declaratory judgment suit in this case to which were attached as exhibits a copy of Hartford’s policy and Wolman’s complaint against Case, Skidmore and Tishman. Hartford prayed for a declaration that the damages alleged by Wolman were not within its policy No. 83 CA 50100 and that it was not obliged to appear, defend, indemnify or provide any monies, costs or expenses to Case, Skidmore or Tishman with respect to the Wolman suit. Answers were filed to Hartford’s complaint. Thereafter, it made a motion for judgment on the pleadings. A short time later, Skidmore made a similar motion for partial judgment, one declaring that Hartford was bound to defend the Wolman suit “* * # unless it becomes clear, from further proceedings * * *, that the occurrences therein alleged are not potentially within the coverage of Hartford’s policy No. 83 CA 50100.”

Briefs were filed. After hearing the parties, the trial court denied Skid-more’s motion, granted Hartford’s and filed a Memorandum of Decision in which it found that the pleadings presented two issues. (1) Whether the Wolman complaint alleged property damage within Coverage D of Hartford’s policy. (2) Whether the occurrences alleged in Wolman’s complaint were subject to the provisions of Exclusion (j). The court analyzed Wolman’s complaint and concluded that it did not allege damage to property, as that term was used in the coverage provisions of the policy. Wolman’s complaint, the court held, alleged negligence and breaches by Case, Skidmore and Tishman which he claimed caused him to lose his investment in and the anticipated profits from the John Hancock Center together with investments in his other ventures. Even if Wolman had alleged damage to property, the court held, Exclusion (j), paragraphs iv(a) and (c) of Hartford’s policy would have applied to all of the three defendants in Wolman s suit. Accordingly, the trial court entered a judgment declaring that Hartford’s policy did not provide coverage for the damages claimed by Wolman and that Hartford was not obliged to appear, defend, provide costs or fees, indemnify or pay any judgment with respect to Wolman’s suit.

II.

Case, Skidmore and Tishman, in separate briefs, make broad attacks on the trial court’s declaratory judgment. They contend that the trial court misconstrued the coverage of Hartford’s policy. They insist that by the terms of its policy, Hartford was obligated to assume defense of the Wolman suit until it became clear that his complaint was definitely beyond the policy’s coverage. They argue that the trial misconceived the function of a Federal court complaint. And as to Exclusion (j) of tire policy, they say that its provisions did not apply to them because the exclusions were not applicable to all of the property they allegedly injured or damaged. Finally, Case, Skidmore and Tishman insist that it was error for the trial court to sustain Hartford’s motion for judgment on the pleadings and rule as a matter of law that coverage was not provided them by Hartford’s policy.

Hartford, on the other hand, contends that Coverage D of its policy provided insurance protection against property damage liability; that is, damages because of injury to or destruction of property, including loss of its use. Hartford makes the point that Wolman’s complaint did not allege injury to or destruction of property; and that even if it did, that is, damage to the caissons which Case constructed, the provisions of Exclusion (j) of its policy would have precluded coverage. Hartford insists that Case, Skidmore and Tishman confuse liability with damages. Its policy, Hartford argues, did not cover every conceivable type of damage for which its insureds might become liable. And as to the construction of the policy, Hartford maintains that the pleadings did not present any question of fact. Therefore, Hartford concludes, the trial court ruled correctly when it sustained the motion for judgment on the pleadings and entered the declaratory judgment.

III.

A motion for judgment on the pleadings tests the sufficiency of the pleadings: whether the plaintiff is entitled to tire relief sought by his complaint or, alternatively, whether defendant, by his answer, has set up a defense which would entitle him to a hearing on the merits. (Carebuilt Corp. v. Horsting, 40 Ill.App.2d 280, 189 N.E.2d 364; Proesel v. Myers Publishing Co., 48 Ill.App.2d 402, 199 N.E.2d 73.) When considering a motion for judgment on the pleadings, the trial court must ascertain whether there is an issue of fact. If there is not, then the only question is which party is entitled to judgment. Baillon v. S. S. Kresge Co., 4 Ill.App.3d 82, 277 N.E.2d 719.

In this case, the record containing motions for judgment on the pleadings, and rulings on them, requires examination of the declaratory judgment complaint, Hartford’s policy, the Wolman complaint and the answers. This examination reveals pleadings that presented no questions of fact. The questions raised concerned construction of Hartford’s liability insurance policy No. 83 CA 50100. Construction of an insurance policy presents only a question of law. (Coons v. Home Life Insurance Co., 368 Ill. 231, 13 N.E.2d 482; Cohen v. Northwestern National Life Insurance Co., 124 Ill.App.2d 15, 259 N.E.2d 865.) Therefore, we conclude that the trial court properly proceeded to construe Hartford’s policy and determined which party was entitled to judgment: in favor of Case, Skidmore and Tishman because they were covered by Hartford’s policy; or in favor of Hartford because its policy did not provide coverage and it was under no duty to defend the Wolman suit.

Insurance policies are contracts. In order to give effect to the intent of the parties, policies should be construed as other contracts are construed. (Morton v. Travelers Indemnity Co. (1960), 171 Neb. 433, 106 N.W.2d 710.) Insurance policies should be construed as a whole, giving effect to every part, as far as it is possible. (Konrad v. Hartford Accident and Indemnity Co., 11 Ill.App.2d 503, 526, 137 N.E.2d 855; 22 I.L.P. Insurance § 145.) Where the language in a policy is clear and unambiguous, it must be taken in its plain, ordinary and popular sense. Banner Insurance Co. v. Avella, 128 Ill.App.2d 471, 262 N.E.2d 791.

These principles lead us to observe that Hartford’s policy is a complex 39-page document that was intended to apply only to claims resulting from construction of the multi-million-dollar John Hancock Center and the existence of the property described in the declarations, including buildings and structures in that location. The policy is a liabilty policy, not one insuring the property or work of the insureds. (McGann v. Hobbs Lumber Co. (1965), 150 W.Va. 364, 145 S.E.2d 476.) Under one of its insuring agreements, with respect to the insurance afforded, Hartford undertook to defend any suit against its insureds that alleged injury to or destruction of property, “* * * even if such suit is groundless, false or fraudulent * * Under this agreement, Hartford assumed the duty to defend any of its insureds whenever a complaint was filed which alleged facts that brought the case within or potentially within the coverage of its insurance contract. (Fragman Construction Co. v. Preston Construc tion Co., 1 Ill.App.3d 1002, 274 N.E.2d 614.) Whether, in the suit filed by Wolman, Hartford had the duty to defend Case, Skidmore and Tishman, depended on the allegations of the complaint and the provisions of its policy. (Maretti v. Midland National Insurance Co., 42 Ill.App.2d 17, 190 N.E.2d 597; Thompson v. Glover, 115 Ill.App.2d 253, 253 N.E.2d 132.) We have looked at Wolman s complaint. Contrary to the contentions and arguments of Case, Skidmore and Tishman, we find its allegations clear and unambiguous.

It was a five-count complaint. Counts I to III stated Wolman’s cause of action against Skidmore. These counts alleged that Skidmore breached the contract under which it undertook to supervise construction of the John Hancock Center by failing to provide accurate cost estimates, proper design documents, proper construction documents for the caissons and proper inspection; that it breached the warranties it made with regard to design, construction and discovery of defects and deficiencies in work and materials and that Skidmore was negligent in the performance of its agreement. Wolman alleged that as a direct and natural consequence of Skidmore’s breaches and negligence, there were delays that caused loss of financing necessary to complete the John Hancock Center; that on December 21, 1966, in order to mitigate his damages, he sold his interest in the project to the John Hancock Mutual Life Insurance Company and thereby lost his investment in excess of $5,000,000, lost the $20,000,000 anticipated profits and was compelled to liquidate his other ventures, causing him to lose more than $50,000,000. He prayed judgment against Skidmore in the sum of $75,000,000.

Count IV stated Wolman’s cause of action against Tishman. This count alleged that Tishman was negligent in the performance of its construction contract by failing to provide timely and accurate estimates of costs, failing to properly supervise construction, failing to properly supervise construction of the foundation and the pouring of the concrete caissons. Wolman alleged that as a direct result of Tishman’s negligence, there was delay in building the John Hancock Center with the result that necessary financing was lost and he was compelled to sell his interest to the John Hancock Mutual Insurance Company with a loss of his investment in excess of $5,000,000, anticipated profits in excess of $20,000,000 and liquidation of his holdings in other enterprises at a loss in excess of $50,000,000. Wolman prayed for damages against Tishman in the amount of $75,000,000.

Count V stated Wolman’s cause of action against Case Foundation Company. This count alleged that Case was negligent in the performance of its subcontract to build the caissons: it selected inferior, unsuitable and defective materials; it failed to use proper construction procedures, causing the caissons to contain great voids, holes, openings and mating it necessary to remove or repair a number of them. As a direct result of Case’s negligence, Wolman alleged, there was the delay that caused him to incur great and unanticipated expenses, loss of his investment in the John Hancock Center, including loss of profits. He prayed judgment against Case in the sum of $25,000,000.

The pertinent provisions of Hartford’s policy provided coverage for “* * * damages because of injury to or destruction of property, including the loss of use thereof # * But, even a cursory reading of Wolman’s complaint reveals that he did not allege injury to or destruction of property by Case, Skidmore and Tishman within the meaning of the policy. Nor did he allege that as a result of what Case, Skidmore and Tishman did or did not do, he suffered damages which were the consequences of injury to or destruction of other property he owned. What Wolman alleged were breaches of contracts and negligence by Case, Skidmore and Tishman which he claimed caused him to lose his investment in and anticipated profits from the John Hancock Center project and his financial interests in other business ventures. This being so, we must decide whether investments, anticipated profits and financial interests are property as that word is used in the coverage provisions of Hartford’s policy.

In the construction of insurance policies, it is a general rule that absent language to the contrary, a word or phrase in one part is presumed to have the same meaning when it is used in another part of a policy. (Schweigert v. Beneficial Standard Life Insurance Co. (1955), 204 Or. 294, 303, 282 P.2d 621; Holter v. National Union Fire Insurance Co. (1969), 1 Wash.App. 46, 459 P.2d 61; Couch on Insurance § 15:19.) Reasoning from this principle, we held in Banner Insurance Co. v. Avella, 128 Ill.App.2d 471, 262 N.E.2d 791 that one who accepts the meaning of a term in the coverage clause of a policy must give that term the same meaning when it appears in the exclusionary clause. Applying these rules to this case, we find that after its undefined use in Coverage D, the word property is used in the policy declarations as the “property bounded by Michigan Ave., Delaware, Chestnut, and Seneca Streets, and the lot line of the Casino Club.” Then, the word appears several times in Exclusion (j) as “property owned or occupied by or rented to the insured,” “property held by the insured for sale,” “property entrusted to the insured for storage or safekeeping,” “property in the custody of the insured” and “property which is being transported by the insured by motor vehicle.” In our judgment, when Coverage D of Hartford’s policy is read in the light of its applicable exclusions, it becomes clear that the word property as used in that provision means physical or tangible property (Geddes & Smith, Inc. v. St. Paul Mercury Indemnity Co. (1959), 51 Cal.2d 558, 334 P.2d 881; Hogan v. Midland National Insurance Co. (1970), 3 Cal.3d 553, 476 P.2d 825.) Investments, anticipated profits and financial interests in business ventures are intangibles; they are not property as that word is used in Coverage D of Hartford’s liability policy. Wolman’s complaint that alleged injury to his investments and anticipated profits did not allege facts that stated a case within or potentially within the coverage of the policy. Therefore, the trial court ruled correctly when, after sustaining Hartford’s motion for judgment on the pleadings, it held that policy No. 83 CA 50100 did not provide Case, Skidmore and Tishman with coverage and that Hartford was not obliged to defend the Wolman suit.

IV.

Case, Skidmore and Tishman contend, however, that Wolman did not sue for injury to or destruction of his investments and anticipated profits. They argue that he brought suit for consequential damages, damages that were the consequences of injury to or destruction of some part or portion of the John Hancock Center. Alerted by the insistence of this argument, we have carefully read Wolman s complaint. It did not allege consequential damages; that is, damages which were the consequences of injury to or destruction of property. Consequential damages mean loss or injury that does not flow directly and immediately from the wrongful act of a party but are the consequences or results of such an act. (See Carva Food Corp. v. Dawley (1961), 202 Va. 543, 546, 118 S.E.2d 664.) Wolman’s complaint alleged that because of breaches of contract and negligence by Case, Skidmore and Tishman, there were delays in the construction of the 100-story John Hancock Center causing him to lose financing commitments and compelling him to sell his interest in the project to the loss of investments and anticipated profits. A different case would have been stated had Wolman alleged injury to or destruction of property by Case, Skidmore and Tishman which produced the claimed damages. Whether, had such allegations been made, consequential damages would have been covered by Hartford’s policy is a question we need not decide because Wolmans complaint did not allege the essential facts.

Ordinarily, what we have said would dispose of this appeal without any discussion of an exclusionary clause. Exclusions in an insurance policy have relevance only when there is coverage. An exclusion, in insurance parlance, serves the purpose of taking out persons or events otherwise included within the defined scope of coverage. (Mobile Oil Corp. v. Reliance Insurance Co. (1971), 69 Misc.2d 876, 332 N.Y.S.2d 532.) Therefore, having held that the policy in question did not include Case, Skidmore and Tishman within its coverage, our task with this case should end. It does not because the parties, assuming an alternative possibility, have argued the applicability of Exclusion (j) of Hartford’s policy. Hartford contends that even if Wolman had alleged injury to or destruction of any part of the John Hancock Center, particularly construction of the caissons, Exclusion(j) would have precluded coverage to Case, Skidmore or Tishman.

This exclusion, in the parts pertinent to the controversy before us, declared that the policy did not apply “(2) * * * to injury to or destruction of * * * (iv) that particular part of any property, * * * (a) upon which operations are being performed by or on behalf of the insured at the time of the injury thereto or destruction thereof, arising out of such operations, or * * * (c) the restoration, repair or replacement of which has been made or is necessary by reason of faulty workmanship thereon by or on behalf of the insured * * * [and] (3) to injury ór destruction of any goods, # * * or work completed by or for the named insured, out of which the accident arises.” Case, Skidmore and Tishman argue that, as to each of them, because Skidmore was the architect, Tishman the general contractor and Case the caisson subcontractor, the exclusionary provisions have different consequences. They insist that Hartford mistakenly applies the exclusion clause without regard to the different functions each of them performed in building the John Hancock Center.

We do not agree. Exclusion (j) applies “to injury to or destruction of * # * that particular part of any property * * * upon which operations are being performed by or on behalf of the insured at the time of the injury to or destruction thereof, arising out of such operations # * This exclusion does not distinguish between functions. It applies whether the injury or destruction results from operations by or on behalf of an architect, a general contractor or a subcontractor engaged in the construction of caissons. The last paragraph of this exclusionary clause excepts coverage for any “injury to or destruction of any goods * * * ox-work completed by or for the named insured out of which the accident arises/’ To understand these exclusionary provisions, it is important to observe that Hartford’s policy insured the John Hancock Center, its owners, financiers, prospective managers, architects, general contractor “* # * and all contractors and subcontractors engaged for work on this project.” Under this policy, the insureds were on equal footing. Plainly, the insured owners could never become legally liable to pay damages for injury to or destruction of any part of the John Hancock Center. And as Jo the other insureds, including Case, Skidmore and Tishman, Exclusion (j) when read with the insuring agreements, conditions and declarations, precluded coverage for any injury to or destruction of any part of the John Hancock Center. Hartford’s policy provided coverage only for injury to or destruction of some other property.

For example, if in the construction of the building, while installing caissons, a valuable Gauguin or a bronze by Ipousteguy owned by Wolman and intended for display in the completed project, were injured or destroyed, Hartford’s policy would have provided coverage. If because of a faulty caisson a crane collapsed and part of it fell on Wolman’s automobile traveling north on Michigan Avenue, Hartford’s policy would have provided coverage. It is possible to imagine other examples. Therefore, it is our opinion that even if Wolman had alleged injury to or destruction of any part of the John Hancock Center, say in construction of the caissons, Exclusion (j) would have applied to preclude Case, Skid-more and Tishman coverage under Hartford’s policy. (Consumers Construction Co. v. American Motorists Insurance Co., 118 Ill.App.2d 441, 254 N.E.2d 265.) With allowance for the factual differences in each case, this opinion finds support in well reasoned decisions of other reviewing courts. (See Hartford Accident and Indemnity Co. v. Olson Bros., Inc. (1971) , 187 Neb. 179, 188 N.W.2d 699; Haugan v. Home Indemnity Co. (1972) , (S.D.), 197 N.W.2d 18; Engine Service, Inc. v. Reliance Insurance Co. (Wyo. 1971), 487 P.2d 474; Vobill Homes, Inc. v. Hartford Accident & Indemnity Co. (La.App. 1965), 179 So.2d 496; McGann v. Hobbs Lumber Co. (1965), 150 W.Va. 364, 145 S.E.2d 476; Volf v. Ocean Accident and Guarantee Corp. (1958), 50 Cal.2d 373, 325 P.2d 987.) We conclude, therefore, that the trial court did not err when it ruled that even had Wolman alleged injury to or destruction of property, Exclusion (j) in Hartford’s policy would have precluded coverage to Case, Skid-more and Tishman.

V.

In separate briefs that reflect the work of capable and conscientious counsel, Case, Skidmore and Tishman agree on the issue presented. They have, however, proliferated their contentions, arguments, points and authorities. Although these have been helpful to the court, it would overly extend this opinion were we to subject them to detailed discussion. It is enough for us to say that all have been considered in determining the proper disposition of this appeal. Having done so, we affirm the judgment of the trial court.

Affirmed.

STAMOS, P- J-, and SCHWARTZ, J., concur.

      For literary convenience, Hartford Accident & Indemnity Company, the plaintiff below and appellee in this court, will be referred to in this opinion as Hartford. Case Foundation Company; Skidmore, Owings & Merrill; Tishman Construction Corporation of Delaware, defendants below and appellants in this court, will be referred to .as Case, Skidmore and Tishman, respectively.

       The other 15% was owned by Earl M. Foreman and his wife Phyllis. On or about June 15, 1965, the Wolmans sold 10% of their interest in the land to J, Theodore Dailey and his wife Maureen. Title to the entire tract was held by the American National Bank as Trustee.

       Jerry Wolman and his wife Anne filed a notice of appeal but did not file a brief in this court. The Foremans and the Daileys filed notices of appeal and filed briefs in this court. As to them, we have entered an order granting them the relief they sought in the trial court. See Supreme Court Rule 366(a)(5), Ill. Rev. Stat. 1971, eh. 110A, par. 366(a)(5). The American National Bank and Trust Company of Chicago, Trustee under its Trust No. 21631 entered into a stipulation to be dismissed from the suit but be bound by any judgment entered in the cause. Therefore, the only parties affected by this opinion are Hartford, Case, Skidmore and Tishman.


source: Caselaw Access Project

author: Mr. JUSTICE McGLOON

license: Public Domain

text:
    First Bank and Trust Company of Palatine, Plaintiff-Appellee, v. Donald Post et al., Defendants-Appellants.
    (No. 56011;
    First District (3rd Division)
    February 8, 1973.

      Kenneth J. Brundage, of Chicago, for appellants.
    George E. Downs, of Palatine, for appellee.
   Mr. JUSTICE McGLOON

delivered the opinion of the court:

This is an appeal from a judgment of the circuit court finding the defendants personally obligated to the plaintiff on a promissory note signed by them. The trial judge entered judgment against the defendants in the amount of $8,483.44, which sum represented the unpaid balance due on the note plus interest and attorney’s fees. Two of the original three defendants pursue this appeal and argue that the judgment of the trial court should be reversed because they signed the note in a representative capacity as officers of a corporation, and not personally. The issues presented are: (1) whether, as between the original parties to the instrument, the defendants are personally liable upon a note intended by both parties to be a corporate obligation which, due to an oversight, bears the signatures of the defendants but does not indicate either the corporation represented or the relationship of the signors to the corporation, and (2) whether the defendants were discharged from their obligation as guarantors of indebtedness.

We reverse.

In June, 1967, the defendants were the officers of a corporation known as Palatine Welding Sales and Manufacturing, Inc. In order to enable the corporation to purchase a lathe needed in the conduct of the business, the defendants negotiated a loan with the plaintiff bank in the amount of $10,000 plus interest, producing a total indebtedness of $11,500. On June 12, 1967, the defendants signed two documents, a chattel mortgage security agreement and a chattel mortgage note, in order to complete the loan transaction. The chattel mortgage security agreement granted to the plaintiff a security interest in the lathe as collateral for the loan. On the security agreement the words “Palatine Welding Sales and Manufacturing, Inc.” were hand-written once at the top left of the document and again on the first line provided for signatures, with the defendants’ signatures beneath. All written notations on the face of the note, except for the defendants’ signatures, were made by the loan officer of the bank, one Delvin Johnston. The chattel mortgage note does not bear the name of the corporation. In the area provided for signatures the names of the three defendants appear with no designation of either the person represented or their representative capacity. On the back of the note there is also what appears to be a one-sentence, typewritten personal endorsement guaranteeing the obligation that appears on the face of the note, below which the signatures of the defendants again appear. Mr. Johnston also had a U.C.C. filing form signed by one of the defendants, Donald Post, at the same time. The filing form was never registered by the plaintiff as is provided by Article 9 of the Uniform Commercial Code.

Sometime thereafter the corporation was placed in bankruptcy, and the lathe was sold by the Receiver in Bankruptcy. During this period the chattel note was held by the plaintiff and was never negotiated to a third person. In April, 1969, the plaintiff confessed judgment against the defendants for the unpaid balance of the note. Subsequently the confession judgment was vacated, and in January, 1971, the matter proceeded to trial at which time the following pertinent evidence was adduced.

Delvin Johnston testified that he was the bank officer who negotiated the loan to the defendants. He stated that he filled in the appropirate blanks on the security agreement and note prior to their signing by the defendants. Johnston further testified that it was his intention that the note be executed by the defendants in their capacity as officers of the Palatine Welding Sales and Manufacturing Corporation, and that due to some oversight he neglected to place the name of the corporation on the note, as he had done in the security agreement. It was his understanding at the time the loan was made that it was a loan to the corporation. Johnston also testified that he explained to the defendants that they were signing for the corporation on the face of the note. The purpose of the typed endorsement on the back of the note was to have fire defendants, in their personal capacity, guarantee the corporate indebtedness.

The three defendants testified at trial that it was also their understanding that the loan was to the corporation and not to bind them personally, except as guarantors of tire indebtedness should the corporation fail to repay the obligation.

The trial judge rendered a verdict for the plaintiff, but failed to state whether the defendants’ liability arose from their signatures on the face of the note or their signatures as guarantors on the reverse of the note.

In this appeal the defendants argue that they cannot be held personally liable on the note in a suit between tire original parties where it was the intention of both the makers and the payee that the signatures on the face of the note were to create a corporate obligation. The defendants further argue that any liability arising from the guarantee on the back of the note was discharged because the plaintiff, by failing to file a financing statement with the Secretary of State (Ill. Rev. Stat. 1969, ch. 26, par. 9 — 401(1) (c)), unjustifiably impaired the collateral for the loan within the meaning of Ill. Rev. Stat. 1969, ch. 26, par. 3 — 606.

In its argument to support the judgment awarded below, the plaintiff relies heavily upon Ill. Rev. Stat. 1969, ch. 26, par. 3 — 403—(2)(a), which states:

“(2) An authorized representative who signs his own name to an instrument (a) is personally obligated if the instrument neither names the person represented nor shows that the representative signed in a representative capacity.”

The plaintiff contends that, notwithstanding the admitted understanding and intention of tire parties that the face of the note was to be a corporate obligation, this court should affirm the judgment of the trial court by strictly construing this section of the Uniform Commercial Code. We do not agree.

First, it is important to point out that all the parties in this suit are the original parties to the note and all testified that it was their intention to create a corporate obligation.

Second, the note and security agreement were executed contemporaneously and as part of the same transaction and concerned the same subject matter and, therefore, should be construed together. (Fronek v. Wroblewski (1930), 255 Ill.App. 529.) The security agreement clearly shows that the corporation, Palatine Welding Sales and Manufacturing, Inc., was a party to this loan transaction. The note appears to be signed by the defendants personally, but the reverse side bears a guarantee wherein the same persons personally guarantee their own signatures, a seemingly senseless redundancy. When construed together the form of these instruments fairly indicates to the eye of common sense that the makers intended to sign the face of the note as officers of the corporation. (Smith v. Reisch (1946), 329 Ill.App. 45, 67 N.E.2d 304; New Georgia Nat. Bank of Albany v. J. & G. Lippmann (1928), 249 N.Y. 307, 164 N.E. 108.) Further, the form of these two instruments as completed certainly present an ambiguous appearance. The ambiguity apparent from the signatures on the note and the security agreement presented a question of fact which justified the introduction of parol evidence to show the intention of the parties and the capacity in which they signed the note, and such intention is controlling in determining their liability. (Uptown Federal Savings & Loan Assn. v. Collins (1969), 105 Ill.App.2d 459, 245 N.E.2d 521.) The cases cited by the plaintiff on this point are clearly distinguishable. In Gelman v. Wendrick (1944), 321 Ill.App. 639, 53 N.E.2d 479; Chandler v. Chandler (1945), 326 Ill.App. 670, 63 N.E.2. 272; and Jones v. Albee (1873), 70 Ill. 34, the attempted introduction of parol evidence was for the purpose of showing some verbal agreement between the parties that limited the makers’ liability, not to clarify an instrument obviously ambiguous on its face.

Finally, we find that the strict application of Ill. Rev. Stat. 1969, ch. 26, par. 3 — 403—(2)(a), to the facts in this case would cause an injustice. Were we to hold otherwise we would be enforcing a result that would be contrary to the intention of all parties. The uncontradicted testimony of all parties to this instrument indicates that the note was understood and intended to be a corporate obligation and that due only to some oversight on the part of the plaintiff the form of the instrument signed did not reflect that understanding. The Uniform Commercial Code was enacted to provide a general uniformity in commercial transactions conducted in this state and was never intended to be used by courts to create a result that is contrary to the clearly understood intentions of the original parties. (Ill. Rev. Stat. 1969, ch. 26, par. 1 — 102.) Therefore, we find that the face of the chattel mortgage note represents a corporate obligation that does not personally obligate the defendants.

We now turn to the issue of whether the defendants are personally liable on their personal guarantee appearing on the back of the chattel mortgage note. The plaintiff argues that this personal guarantee establishes the liability of the defendants for the unpaid balance of the note, whether or not the court determines that the face of the note is a personal obligation. We do not agree.

Ill. Rev. Stat. 1969, ch. 26, par. 3 — 606(1) (b) states:

“(1) The holder discharges any party to the instrument to the extent that without such party’s consent the holder (b) unjustifiably impairs any collateral for the instrument given by or on behalf of the party or any person against whom he has a right of recourse.”

By not filing a financing statement as is required by Ill. Rev. Stat. 1969, ch. 26, par. 9 — 302, the plaintiff held an unperfected security interest in the collateral which “is subordinate to the rights of a person who becomes a hen creditor without knowledge of the security interests and before it is perfected.” (Ill. Rev. Stat. 1969, ch. 26, par. 9 — 301(1)(b).) A ‘lien creditor” is defined by the Code to include a Trustee in Bankruptcy from the date of the filing of the petition. Ill. Rev. Stat. 1969, ch. 26, par. 9 — 301(3).

By not filing the financing statement in accordance with Article 9 of the Code, the plaintiff’s security interest was subordinate to that of the Trustee in Bankruptcy. This subordinate position produced an unjustifiable impairment of the collateral in that the plaintiff was prevented from disposing of the collateral and crediting the amount received to the indebtedness owed to it by the corporation. The defendants, as guarantors of the corporate indebtedness, would then have only been responsible for any remaining indebtedness, had there been any, instead of the entire unpaid balance, as is the plaintiff’s present theory. See, Kopf v. Yordy (1917), 208 Ill.App. 580; and Uniform Commercial Code, Comment 5 to Ill. Rev. Stat. 1969, ch. 26, par. 3 — 606.

The plaintiff argues that certain phrases contained in the note signed by defendants waived their right to the defense of discharge under Paragraph 3 — 606(l)(b). These sections of the note referred to by the plaintiff express the signors consent to the holders granting of extensions of time of payment or performance and the signors waiver of any presentment, demand, protest or notice of dishonor. Giving these clauses even the most liberal interpretation, they obviously do not purport to waive or give consent to the unjustifiable impairment of collateral by the plaintiff. We find that the defendants have not waived their defense under Paragraph 3 — 606(1) (b) and, therefore, they are discharged from the obligation as personal guarantors of the indebtedness.

For the above reasons we reverse the judgment of the circuit court of Cook County.

Judgment reversed.

DEMPSEY, P. J., and McNAMARA, J., concur.


author: PER CURIAM.

text:
    The City of Chicago, Plaintiff-Appellee, v. Max L. Bender et al., Defendants—(Max L. Bender, Defendant-Appellant.)
    (No. 56917;
    First District (3rd Division)
    February 8, 1973.
    Leonard Karlin, of Chicago, for appellant.
    Richard L. Curry, Corporation Counsel, of Chicago, (William R. Quinlan and Robert R. Retke, Assistant Corporation Counsel, of counsel,) for appellee.
   PER CURIAM.


author: Mr. JUSTICE EGAN

text:
    Home And Automobile Insurance Company, Plaintiff-Appellant, v. Richard O. Scharli, Individually and as Admr. of the Estate of Lee K. Scharli et al., Defendants-Appellees.
    (No. 55759;
    First District (1st Division)
    February 13, 1973.

      Ernest T. Koehler, of Chicago, for appellant.
    Gerald S. Murphy, of Chicago, for appellees.
   Mr. JUSTICE EGAN

delivered the opinion of the court:

The plaintiff, Home and Automobile Insurance Company, sued for a declaratory judgment that the automobile insurance policy it issued to the defendant, Richard O. Scharli, was void ab initio and that the policy was, therefore, not in effect on October 14, 1965, when the defendant’s car was involved in an accident. The plaintiff contends that defendant made a misrepresentation in his application that materially affected the acceptance of the risk it assumed in issuing the policy. The trial judge found that the wording of the application was ambiguous. As a result of his construction of the language of the application he found that the insurer had failed to prove a misrepresentation by the insured.

The application, Section 9, reads as follows:

“9. Statement of Convictions. Has the applicant * * * been convicted of any of the following motor vehicle violations during the preceding 36 months?
(a) Driving while intoxicated or under the influence of drugs.
(b) Failure to stop and report when involved in an accident.
(c) Homicide or assault arising out of die operation of a motor vehicle.
(d) Driving during a period while license is suspended or revoked.
(e) The accumulation of points under a state point system or a series of convictions as a result of which a filing of evidence of financial responsibility is required. (Emphasis added.)
(f) Any other conviction of a moving traffic violation as a result of which a filing of evidence of financial responsibility is required.
(g) Any other conviction of a moving traffic violation as a result of which the operator’s license was suspended or revoked.”

The defendant answered all the questions in the negative.

The policy covering the family automobile was issued on October 7, 1965, and was to terminate on October 7, 1966. The accident occurred on October 14, 1965. Driving the family automobile was the defendant’s son, Lee K. Scharli. Lee, John Kearney, who was a passenger in the defendant’s car, and Richard J. Barnicke, the driver of the other car involved, all died as a result of the accident. The defendant’s license had been suspended on March 3, 1963, for 30 days. The record does not disclose when the plaintiff discovered this. There is no stenographic report of proceedings before us but rather what has been entitled “Record of Proceedings,” prepared by the plaintiff and approved by the trial judge. The Record of Proceedings, which is, in effect, a statement of facts, recites that the defendant testified that his license had been revoked during the 36-month period preceding the date of the application. However, the same Record contains the allegation that the trial judge found that the license suspension was a result of “three violations.” The conflict in the record apparently has been resolved by the statements made in oral argument that the defendant’s license had been suspended for 30 days for three traffic violations.

The defendant claims that sub-paragraph 9(g) of the application is ambiguous, that “any other conviction” means a single conviction of an offense like driving under the influence of alcohol or leaving the scene of an accident, rather than a series of convictions. (Ill. Rev. Stat. 1971, ch. 95%, sec. 6A-205, 206.) The plaintiff contends that “any other conviction” includes a “series of convictions” or, at least, means the last conviction of the series that caused the suspension. There is no issue as to the materiality of the representation. Loving v. All State Insurance Co., 17 Ill.App.2d 230, 149 N.E.2d 641.

Insofar as we can determine from the Record before us, the trial court held that the language of the application should be construed strictly against the insurer and accepted the interpretation that tire defendant gave the phrase.

The rule has been pronounced too often to require citation: Where it is possible that the language of an insurance policy is susceptible of two constructions, that construction will be adopted which is more favorable to the insured. Chapter 95Vz, section 6 — 205, enumerates the offenses for which a license may be revoked. They include offenses which are not covered in the application, e.g., drag racing. Thus, one could argue that the phrase “any other conviction” referred to some other moving violation listed in the statute not already expressly referred to in the application.

In addition, the application has two separate questions concerning tire filing of evidence of financial responsibility. 9(e) inquires about a “series of convictions as a result of which a filing of evidence of financial responsibility is required.” (Emphasis added.) 9(f) inquires about “any other conviction of a moving traffic violation as a result of which a filing of evidence of financial responsibility is required.” (Emphasis added.) If the insurers position is correct, then part of question 9(e) is redundant. Meaning and effect should be given, if possible, to every part of a contract including all its terms and provisions. No part of a contract should be rejected as meaningless or surplusage unless absolutely necessary. The reason for the rule is that it is presumed that all the provisions of a contract are inserted deliberately and for a purpose, and that the parties to a transaction did not intend to employ language idly. ILP Contracts, Section 215.

Why then did the insurer speak of both “series of convictions” and “any other conviction” with respect to financial responsibility but only “any other conviction” with respect to revocation or suspension? We must assume that the author of the policy was aware of the distinction between the two phrases and selected them with care and that by including both phrases in his questions concerning financial responsibility and only one concerning revocation or suspension he intended to exclude “series of convictions” from 9(g). We conclude, therefore, that the trial judge’s construction of the language of the application and his finding that the applicant had made no misrepresentation were correct.

The judgment of the circuit court is affirmed.

Judgment affirmed.

BURKE, P. J, and GOLDBERG, J., concur.


author: Mr. PRESIDING JUSTICE BURKE

text:
    Elliott Boston, Plaintiff-Appellee, v. Lake Shore Mutual Insurance Company et al., Defendants-Appellants.
    (No. 56168;
    First District (1st Division)
    February 13, 1973.
    Greenberg, Ziv & McCarthy, of Skokie, (Frank E. McCarthy, of counsel,) for appellants.
    Palmer, Kipnis & Kahn, of Chicago, (Claude B. Kahn, of counsel,) for appellee.
   Mr. PRESIDING JUSTICE BURKE

delivered the opinion of the court:

Elliott Boston filed a two count complaint based on malicious prosecution against Norman Fein and his employer, the Lake Shore Mutual Insurance Company and Prestige Insurance Group. The first count was grounded on a criminal action in the Circuit Court of Cook County, Illinois; the second count on charges and a hearing before the Police Board of the Chicago Police Department, plaintiff’s employer. The jury found for Norman Fein and against the plaintiff and for plaintiff and against the insurance company, assessing damages at $15,000. The insurance company appeals from the judgment on the verdict in favor of plaintiff. No cross-appeal was filed from the judgment in favor of Norman Fein.

Early in 1983, the plaintiff’s friend, L. A. (Big Boy) Dowdy, asked him for assistance in purchasing a 1957 Mercury automobile. The plaintiff prepared the credit application, co-signed the note and prepared the insurance application forms for Dowdy, who could neither read nor write. Insurance was provided by the defendant, Lake Shore Mutual Insurance Company, which has since become part of Prestige Insurance Group.

On April 20, 1963, the plaintiff’s friend reported die theft of his car to the defendant insurance company and, with plaintiff’s assistance, filled out the necessary forms to report the loss. Also on April 20, 1963, the plaintiff’s friend reported the theft to the Chicago Police Department. The following day, the police notified plaintiff’s friend that the car had been found. It has been stripped and damaged beyond repair. The defendant corporation furnished Dowdy with a 1958 automobile in full settlement of his claim. The company file on the claim was then closed.

Approximately October 1, 1963, Fred Killingsworth informed the defendant corporation that the car reported stolen from Dowdy had not in fact been stolen, that it was inoperable when it was towed from the point where Dowdy bought it, and that it had been stored in Killings-worth’s garage for three months after Dowdy purchased it. Killingsworth stated that the plaintiff had further damaged the car with a sledge hammer after Killingsworth had removed the engine.

Defendant Norman Fein reviewed a signed statement that Killings-worth gave the insurance company and discussed the contents with several executives of the company. Then he brought the information to the house counsel of the insurance company, Robert Conley. Conley arranged a meeting between Fein and an assistant State’s Attorney. Following informal discussion with the assistant State’s Attorney, a complaint was signed and sworn by Norman Fein on behalf of his employer against the plaintiff, Elliott Boston. The judge to whom the complaint was presented examined the complaint and the person presenting it and, being satisfied that there was probable cause for filing it, granted leave to file the complaint and ordered a warrant to issue for the apprehension of the plaintiff. After the arrest of the plaintiff, the case proceeded until June 4, 1964, when it was dismissed for want of prosecution.

The plaintiff was also called to a hearing before the disciplinary board of the Chicago Police Department. He was suspended from duty because of the pending criminal charge. The board subsequently exonerated the plaintiff, and he was restored to duty.

It is well-settled in Illinois that where an action against an employer is based solely on the tortious act of an employee, and the employee is exonerated at trial, the employer must also be found free of liability. (Rogina v. Midwest Flying Service, 325 Ill.App. 588, 60 N.E.2d 633.) A corollary to this rule is the principle that if an action against the employer is based on other than the exonerated employee’s act or omission, it is possible to render a verdict against the employer and, at the same time, free the named employee. Bunyan v. American Glycerin Co., 230 Ill.App. 351; Devore v. Toledo, Peoria & W. R.R., 30 Ill.App.2d 409, 174 N.E.2d 883.

The plaintiff argues that his cause of action is based on other than the actions of Norman Fein, and that the actions of other employees of the insurance company will support the jury finding against the employer.

The record reveals only one other employee named by the plaintiff. He is Robert Conley, house counsel for the defendant insurance company. His actions consisted of discussing Mr. Iiillingsworth’s statement with Mr. Fein, examining other documents kept by the insurance company on the claim filed by Mr. Dowdy and arranging a conference with the assistant State’s Attorney to determine if there was probable cause for issuing a complaint against Elliott Boston. We cannot say that these acts support a verdict of malicious prosecution against tire insurance company. We conclude that the court should have granted the corporate defendant’s motion for judgment notwithstanding the verdict.

Nor do the cases cited by the plaintiff require a different result. In Bunyan v. American Glycerin Co., 230 Ill.App. 351, the court affirmed a judgment against the corporate employer, even though the employee named in the complaint was exonerated. The court reasoned that though the named employee was not negligent in leaving partially full cans of nitroglycerin where children subsequently found them, there was evidence that other employees of the defendant had been negligent in leaving the cans where the children found them. Hence, the corporation was liable for the injuries that resulted from the subsequent explosion. There was no such evidence in the case before us.

In Devore v. Toledo, Peoria & W. R.R., 30 Ill.App.2d 409, 174 N.E.2d 883, the plaintiff was injured by a train at a railroad crossing. He charged that the defendant railroad’s employees were negligent in signaling the approach of the train. The jury found that they were not negligent, but also returned a verdict against the defendant railroad. The Appellate Court reasoned that plaintiff’s complaint contained a charge that the railroad was negligent in improperly marking the crossing, so that a verdict against the railroad could stand even if the named employees were freed of liability. The judgment against the railroad corporation was reversed, however, because the plaintiff was found guilty of contributory negligence. In the case before us, there is no separate cause of action which could sustain a verdict against the insurance company independent of a finding against its employee, Norman Fein.

It should be noted that the cases cited involved negligence actions, rather than the type of situation before us, which requires proof of affirmative acts of the defendant to sustain a verdict. (Freides v. SaniMode Mfg. Co., 33 Ill.2d 291, 211 N.E.2d 286.) In addition, the corporate defendants in the cited cases were charged with a higher degree of care than that required of other persons.

For these reasons the judgment is reversed and the cause remanded with directions to enter judgment notwithstanding the verdict for the defendant corporation and against the plaintiff.

Judgment reversed and cause remanded with directions.

ADESKO and GOLDBERG, JJ., concur.


author: Mr. JUSTICE GOLDBERG

text:
    Mossie Huggins, Plaintiff-Appellant, v. Board of Review, The Department of Labor et al., Defendants-Appellees.
    (No. 56199;
    First Distract (1st Division)
    February 13, 1973.

      James Fox, of East Garfield Neighborhood Legal Services, of Chicago, for appellant.
    William J. Scott, Attorney General, of Chicago, (Francis T. Crowe and Herman R. Tavins, Assistant Attorneys General, of counsel,) for appellees.
   Mr. JUSTICE GOLDBERG

delivered the opinion of the court:

In an action under the Administrative Review Act (Ill. Rev. Stat. 1971, ch. 110, par. 264, et seq.), the circuit court of Cook County affirmed a decision of the Board of Review of the Department of Labor of Illinois, Division of Unemployment Compensation (Board). The Board determined that it had no jurisdiction to hear claimant’s appeal from an adverse decision by a Referee because of late filing of the appeal.

Claimant filed her claim for benefits on November 2, 1969. Her former employer filed a Notice of Possible Ineligibility. On October 13, 1970, a Deputy made a written finding that the claimant was unavailable for work during the material time and, therefore, was ineligible for benefits. On October 14, 1970, copies of this finding were mailed to the former employer and also to claimant. The applicable statute provides that an appeal may be had by the claimant from such determination by the Deputy “* * ° within nine days after such notification was mailed to his last known address * * (Ill. Rev. Stat. 1971, ch. 48, par. 470.) The same portion of the statute provides that unless such appeal is filed within the allotted nine day period, the “* * # ‘determination’ shall be final as to all parties given notice thereof.”

The nine day period for appeal expired on October 23, 1970. On October 27, 1970, claimant filed a notice to appeal the decision of the Deputy to a Referee of the Appeals Section. The record shows here that claimant stated she did not receive the Deputy’s determination dated October 14, 1970, but this document had not been returned to the local office. On November 30, 1970, a hearing was held before the Referee. Claimant testified that the Deputy’s determination was mailed to her and that she received a copy thereof. However, she further testified that she thought that she did not receive the determination; that she was told to appeal anyway and that she received it "later.” She also stated that she had trouble with her mail "‘a couple of times.” At this hearing, the Referee told the claimant that if she ever had any determination that she disagreed with she should file her appeal as soon as she possibly could.

On December 9, 1970, the Referee mailed to claimant a copy of his ruling in which he indicated that the record showed that the appeal had been filed after expiration of the statutory appeal period and there had been no showing that the record was in error. The Referee accordingly held that the previous determination by the Deputy had become final and that he was without jurisdiction to hear the appeal on its merits. The appeal was accordingly dismissed. We note that a copy of this decision reflects mailing to claimánt at the same address which she gave as her place of residence at the hearing before the Referee. The same mailing address is reflected in the determination previously made by the Deputy. This ruling by the Referee also contained a statement that it would become final unless written notice of appeal was filed within ten days from the date of mailing thereof.

This ten day period expired on December 19, 1970, which was the last day for filing of notice of appeal to the Board. The pertinent statute provides that the decision of the Referee shall be final unless appeal is initiated to the Board within ten days after the date of mailing of the decision of the Referee. Ill. Rev. Stat. 1971, ch. 48, par. 471.

Plaintiff filed written notice of appeal from the Referee’s determination to the Board of Review on December 29, 1970. This was ten days after expiration of the statutory time for appeal. On January 28, 1971, the Board filed a written decision finding that it had no jurisdiction to entertain tlie appeal. The decision also pointed out that the previous appeal by the claimant from the determination of the Deputy to the Referee had not been filed within the time limit of the statute so that the Referee correctly concluded that he had no jurisdiction and that the previous decision of the Deputy had become final.

It does not appear that the precise point here involved has ever been decided in Illinois. In Clark v. Dept. of Labor, 71 Ill.App.2d 365, 219 N.E.2d 143, claimant attempted to appeal from a decision of a Deputy denying his claim. This court did not pass upon the contention that the statutory appeal periods in the Unemployment Compensation Act are mandatory. See 71 Ill.App.2d 365 at page 371.

It is our considered opinion that the requirements of the Illinois statute are clear and unambiguous; hence unavoidably mandatory. The decision of the Deputy or of the Referee, as the case may be, becomes final if appeal is not timely filed within the plain language of the statute. There is no provision in this statute for late filing of notice of appeal. (Compare Supreme Court Rule 303(e) also Rule 606(c), 50 Ill.2d Rules 303(e) and 606(c).) The timely fifing of the notice of appeal is thus jurisdictional.

It is undoubtedly correct, as urged by counsel for claimant, that the Unemployment Compensation Act of Illinois, enacted in the interest of the public welfare, is to be liberally construed. (American Steel Foundries v. Gordon, 404 Ill. 174, 180, 88 N.E.2d 465.) The objective of the Act is an attempt to eliminate “[pjoverty, distress and suffering.” (Ill. Rev. Stat. 1971, ch. 48, par. 300.) It had its genesis as “a direct result of the economic depression of the 1930’s.” (Article by Samuel C. Bernstein, former Administrator, Bureau of Employment Security in S.H.A. ch. 48, pages IX to LI.) However, these general principles cannot permit us to overlook or disregard the clear language of the statute specifying, without exception, in two instances, the number of days within which an appeal must be taken and providing that without such appeal the decision sought to be avoided becomes final.

The Unemployment Compensation statutes of other states do not assist claimant. The Rhode Island statute provides that the appeal time “# # # period may be extended for good cause.” (Title 28, ch. 44, 1967 Rhode Island Employment Security Act, secs. 28-44-46.) Identical language appears in the California statute. (Cal. 1967 Unemployment Insurance Code, sec. 1328.) In Pennsylvania, all appeals from the Referee to the Board are permissive and not a matter of right and they are also subject to a mandatory ten day time limit. 43 Penn. Stats, sec. 821.

Similarly, none of the decisions cited by claimant support her contention. On the contrary, one case cited by claimant is diametrically opposed to her position. In Turner v. Unemployment Compensation Board of Review, 163 Pa. Super. 168, 60 A.2d 583, the appeal time limit in the Pennsylvania statute was construed as a completely mandatory limitation subject to waiver only under circumstances showing fraud or its equivalent. The Pennsylvania court pointed out that mere hardship, illness of tire claimant, or neglect are all insufficient.

We have granted leave to diligent counsel for the claimant to file for our consideration as additional authority a decision by tire Board in another matter handed down on July 7, 1972, (In the Matter of Frank White, 72 BRD 2389), and another Board decision filed on January 4, 1973. (In the Matter of Maurice Le Faire, 73 BRD 36.) The Board decisions are not binding upon this court but they are advisory only and we will consider them accordingly.

In White, a decision of the Referee which denied benefits to the claimant was mailed on January 10, 1972. The appeal to the Board was filed after the expiration of the statutory time. However, the Board pointed out that the Referee’s decision may not have been properly addressed. This was set forth in an affidavit by counsel for the claimant and the late appeal was accepted by the Board. Similarly, in Le Faire, the claimant submitted an affidavit that he had not received the Referee’s decision. The Board held that this created an uncertainty as to actual mailing. Neither of these decisions waives or extends the mandatory statutory time limitation but they decide that the facts were such that the allotted period never actually commenced to run by virtue of mailing. On the contrary, in the case at bar the record shows affirmatively that mailing was proper in two instances and yet claimant violated the statutory time periods granted for both of her appeals.

Claimant urges that she was afforded no opportunity to offer a good cause reason for the delay in her appeals. Quite to the contrary, the record shows that claimant appeared before the Referee and was offered a full opportunity to justify her delay in filing the notice of appeal from the determination of the Deputy. However, claimant first stated that she did receive a copy of the Deputy’s determination, then stated that she did not and finally stated that she previously had trouble with her mail. This pure conclusion cannot be regarded as a sufficient showing of a good cause reason for delay in filing the appeal. This is particularly true in the case at bar where, despite the suggestion from the Referee that claimant should file her appeal as soon as she possibly could, she was again late in filing her subsequent notice of appeal from the decision of the Referee to the Board.

We have no alternative but to affirm the decision of the trial court approving the decision of the Board.

Order affirmed.

BURKE, P. J., and DRUCKER, J., concur.


text:
    The People of the State of Illinois, Respondent-Appellee, v. Philip M. Doyle, Petitioner-Appellant.
    (No. 56747;
    First District (2nd Division)
    February 13, 1973.
    Gerald W. Getty, Public Defender, of Chicago, (Lee T. Hettinger and James J. Doherty, Assistant Public Defenders, of counsel,) for appellant.
    Edward V. Hanrahan, State’s Attorney, of Chicago, (Elmer C. Kissane and William D. Wolter, Assistant State’s Attorneys, of counsel,) for the People.
   PER CURIAM.


text:
    The People of the State of Illinois, Plaintiff-Appellee, v. Larry Jackson, Defendant-Appellant.
    (No. 56864;
    First District (2nd Division)
    February 13, 1973.
    James J. Doherty, Public Defender, of Chicago, (Shelvin Singer, Assistant Public Defender, of counsel,) for appellant.
    Edward V. Hanrahan, State’s Attorney, of Chicago, (Elmer C. Kissane and Fred Chaimson, Assistant State’s Attorneys, of counsel,) for the People.
   PER CURIAM.


author: Mr. PRESIDING JUSTICE BURKE.

text:
    The People of the State of Illinois, Plaintiff-Appellee, v. Robert Lee Mims, Defendant-Appellant.
    (No. 57072;
    First District (1st Division)
    February 13, 1973.
    Gerald D. Hosier and Robert P. Cummins, both of Hume, Clement, Hume & Lee, Ltd., of Chicago, for appellant.
    William J. Scott, Attorney General, of Springfield, and Edward V. Hanrahan, State’s Attorney, of Chicago, (James B. Zagel, Assistant Attorney General, and Elmer C. Kissane and James R. Truschke, Assistant State’s Attorneys, of counsel,) for the People.
   Opinion by

Mr. PRESIDING JUSTICE BURKE.


text:
    The People of the State of Illinois, Respondent-Appellee, v. Wiley Pinkley, Petitioner-Appellant.
    (No. 57078;
    First District (2nd Division)
    February 13, 1973.
   PER CURIAM.

James B. Haddad, of Chicago, for appellant.

Edward V. Hanrahan, State’s Attorney, of Chicago, (Elmer C. Kissane, Ricky Petrone, and William Wolter, Assistant State’s Attorneys, of counsel,) for the People.


text:
    Amparo T. Quirino, Plaintiff-Appellant, v. Chicago Tribune-New York News Syndicate, Inc., Defendant-Appellee.
    (No. 57175;
    First District (1st Division)
    February 13, 1973.
    Sidney S. Altman, of Chicago, for appellant.
    Kirkland & Ellis, of Chicago, (Don H. Reuben, Lawrence Gunnels, and James A. Serritella, of counsel,) for appellee.
   MODIFIED OPINION UPON REHEARING

Mr. JUSTICE GOLDBERG

delivered the opinion of the court:

Amparo T. Quirino (plaintiff) appealed to the Supreme Court of Illinois from an order dismissing “on the merits and with prejudice” her libel action against Chicago Tribune-New York News Syndicate, Inc. (defendant). The appeal has been transferred to this court. A summary of the trial court record is required.

The alleged libel stemmed from an article published by defendant on June 14, 1964. Plaintiff’s original suit was filed in the circuit court of Cook County on June 12, 1965. This was very shortly before expiration of the one year Statute of Limitations. (Ill. Rev. Stat. 1965, ch. 83, par. 14.) On July 28, 1969, the court dismissed the suit at a pretrial conference. The order recited that plaintiff failed to answer the call in person or otherwise appear. The order provided that the cause was dismissed “for want of prosecution under the provision of Supreme Court Rule 219(c).” On August 22, 1969, plaintiff filed a motion to vacate the order of dismissal. This motion was denied on September 19, 1969.

On September 18, 1970, plaintiff filed a new suit predicated upon the alleged libel. Defendant filed a motion to dismiss setting out that plaintiff had failed to exercise diligence in service of summons in the previous case so that the suit should be dismissed as required by Rule 103(b) of the Supreme Court. The court sustained defendant’s motion and dismissed the second suit “on the merits and with prejudice.”

Supreme Court Rule 273 provides (Ill. Rev. Stat. 1971, ch. 110A, par. 273):

“Unless the order of dismissal or a statute of this State otherwise specifies, an involuntaiy dismissal of an action, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join an indispensable party, operates as an adjudication upon the merits.”

Plaintiff contends that Rule 273 does not apply to the situation here presented because the Statute of Limitations expressly granted her an ■additional year within which to file another suit. (Ill. Rev. Stat. 1967, ch. ■83, par. 24(a).) Defendant contends that this section 24(a) of the ■Statute of Limitations is inapplicable upon the authority of Ray v. Bokorney, 133 Ill.App.2d 141, 272 N.E.2d 836, decided by this court in May of 1971.

This portion of the statute provides that, where an action has been dismissed for want of prosecution, plaintiff may commence a new action within one year or within the remaining period of limitation, whichever is greater. Plaintiff contends that under the plain language of this statute, since the limitation period had expired when plaintifFs first suit was dismissed for want of prosecution on July 28, 1969, and motion to vacate ■this order was denied on September 19, 1969, that plaintiff is entitled to an additional year for the filing of the second suit.

At first glance, it would appear from a reading of the bare language ■of the statute that plaintiff’s contention is well founded. Furthermore, as plaintiff urges, this portion of the Statute of Limitations “* * * is a remedial statute which should be liberally construed” (In re Estate of Breault, 113 Ill.App.2d 356, 251 N.E.2d 910.) With these thoughts in mind, let us analyze our prior decision in Ray. There, plaintiff was injured on defendant’s property on February 29, 1964. On February 25, 1966, four days prior to expiration of the Statute of Limitations, she filed suit. Summons was never served. On March 12, 1969 the suit was dismissed for want of prosecution. Twelve days later, on March 24, 1969, plaintiff filed a second suit and promptly obtained service of summons. The trial court dismissed the second suit. The order of dismissal was affirmed by this court. We held “* * * that it would be contrary to the object, spirit and meaning of section 24(a) to afford plaintiff relief.” (272 N.E.2d 836, at page 840.) The opinion analyzed the authorities and relied particularly upon Tidwell v. Smith, 57 Ill.App.2d 271, 205 N.E.2d 484.

We conclude that Ray is directly in point and decisive of the issues in the case at bar. In fact, the only points of differentiation serve to strengthen this conclusion. In Ray, plaintiff filed the second suit a mere 12 days after tire order dismissing the first. Here, plaintiff waited from July 28, 1969 to September 18, 1970 before filing the second suit. Furthermore, in Ray, defendant was a resident of Minnesota. In the case at bar, the defendant is well known as a Chicago newspaper and therefore directly and easily amenable to process.

There is also general authority which requires us to consider not only the language of the statute itself as urged by plaintiff, but also the spirit and intent of the legislative enactment. (See Ill. Rev. Stat. 1971, ch. 131, par. 1.01.) We are required to “* * * consider the spirit of the enactment, and that spirit will control over the letter of the statute, where there is a conflict.” Inskip v. Trustees, Univ. of Ill., 26 Ill.2d 501, 510, 187 N.E.2d 201.

The record here reflects complete lack of diligence by plaintiff. Plaintiff waited until the statute had virtually run before filing the first suit. She was not diligent in obtaining service of process upon a readily available defendant. She then waited an inordinately long time before filing her second suit, with full knowledge of the order of dismissal. In any event, tire spirit and intent of section 24(a) of the Limitation Statute prevent us from granting relief in the type of situation presented by tire case at bar. Both Ray and Tidwell require that we construe the statute as limited to granting relief only to those litigants who have acted with diligence. We cannot bring plaintiff within this category. Section 24(a) was not intended as a refuge for the negligent but only as an aid for the diligent.

The order of dismissal appealed from is, therefore, affirmed.

Order affirmed.

BURKE, P. J., and EGAN, J., concur.


text:
    The People of the State of Illinois, Plaintiff-Appellee, v. Carl Harris, Defendant-Appellant.
    (No. 56171;
    First District (3rd Division)
    February 15, 1973.
    Gerald W. Getty, Public Defender, of Chicago, (Michael Weininger and James J. Doherty, Assistant Public Defenders, of counsel,) for appellant.
    Bernard Carey, State’s Attorney, of Chicago, (Elmer C. Kissane and Richard Pezzopane, Assistant State’s Attorneys, of counsel,) for the People.
   PER CURIAM.


text:
    Agnes Mystek, Plaintiff-Appellee, v. Humberto Q. De La Rosa, Defendant-Appellant.
    (No. 57787;
    First District (3rd Division)
    February 15, 1973.
    Alvin E. Rosenbloom, of Chicago, for appellant.
    Eugene P. Meegan, of Chicago, for appellee.
   PER CURIAM.


text:
    The People of the State of Illinois, Plaintiff-Appellee , v. Frank McCall, Defendant-Appellant.
    (No. 56376;
    First District (5th Division)
    February 16, 1973.
   PER CURIAM.

Thomas J. Grippando, of Legal Aid Society, of Chicago, for appellant.

Edward V. Hanrahan, State’s Attorney, of Chicago, (Elmer C. Kissane and James E. Staruck, Assistant State’s Attorneys, of counsel,) for the People.


author: Mr. JUSTICE LORENZ

text:
    The People of the State of Illinois, Plaintiff-Appellee, v. Gerald Stallcup, Defendant-Appellant.
    (No. 56618,
    First District (5th Division)
    February 16, 1973.

      James J. Doherty, Public Defender, of Chicago, (Mitchell Melamed and Robert M. Gray, Assistant Public Defenders, of counsel,) for appellant.
    Edward V. Hanrahan, State’s Attorney, of Chicago, (Elmer C. Kissane, Ronald Maimonis, and Joseph Romano, Assistant State’s Attorneys, of counsel,) for the People.
   Mr. JUSTICE LORENZ

delivered the opinion of the court:

Upon a complaint signed by the victim’s mother, defendant Gerald Stallcup was charged with the theft of $5.00 from Thomas Delaney, a mute. At the close of the State’s case in a bench trial, defendant moved for a finding in his favor which was denied, and the defense rested without presenting evidence. The court found defendant guilty and sentenced him to a term of one year at the Vandalia State Farm.

On appeal defendant contends: (1) that the complaint was defective because it failed to allege the requisite mental state by omitting the word “knowingly,” (2) that the court erred by not determining the competence of a thirteen year old witness before permitting him to testify, (3) that the evidence failed to show that defendant exercised unauthorized control over the victim’s property, and (4) that the court erred by relying on a subsequent offense not charged in the complaint.

The complaint contained the following allegation:

“that Gerald Stallcup has, on or about 8 Sept. 1971 at 2448 N. Lincoln Ave. Cook County, Illinois committed the offense of THEFT in that he did obtain unauthorized control ovér property, to-wit: $5.00 U.S.C. of value less than $150.00, the property of, Thomas Delaney, with the intent to deprive said Thomas Delaney permanently of the use and benefit of said property in violation of Chapter 38 Section 16 — l(a)(l) ILLINOIS REVISED SÍATUTE AND AGAINST THE PEACE AND DIGNITY OF THE PEOPLE OF THE STATE OF ILLINOIS.”

Although the complaint omitted the word “knowingly” contained in the statute, defense counsel made no objection to the form of the complaint either before or during trial.

Thomas Delaney, being mute, did not himself testify at trial although he may have had the ability to do so through his mother. However, three other witnesses testified for the State: Mark Scott, Officer Haisch the arresting officer, and Roseanna Delaney, the victim’s mother. Without defense objection to his competence, a thirteen-year-old boy Mark Scott testified at trial as the State’s only occurrence witness. He testified that as he was playing center field in a baseball game, a ball was hit into the street. While retrieving the ball, he saw defendant hit Thomas Delaney, take a package of Camel cigarettes from him, take out the $5.00 which was in the package, hit Delaney four more times, and then leave. The witness and some of his friends took Delaney home and then returned to their game. The witness further testified without defense objection that about twenty minutes later Delaney returned along the same course and was again accosted by defendant who turned Delaney’s pockets inside out taking some change from him. When the witness saw this second incident, he and his friends approached defendant demanding him to return the money but defendant refused.

At the close of its evidence, the State asked the court to take judicial notice of the fact the victim was mute and that the taking was without consent. The court did take judicial notice of the fact that the victim was mute. However, regarding judicial notice of lack of consent the court stated:

“I have evidence before me of a striking, of a hand going in the pocket, and the pulling the pocket inside out. There is no question as to whether that in itself indicates it was without consent. I would have to base my decision on all the facts before me. If the state has nothing further to offer.”

When asked to clarify its ruling the court stated: “The other notice [of lack of consent] I may take would be based on the evidence. There is no testimony from the victim that he gave permission.”

OPINION

Defendant first contends that the complaint was defective because it failed to allege the requisite mental state. The statute insofar as it applies to the instant case reads as follows:

“A person commits theft when he knowingly: (a) obtains or exerts unauthorized control over the property of the owner * * * and (1) Intends to deprive the owner permanently of the use or benefit of the property.” (Ill. Rev. Stat. 1969, ch. 38, sec. 16 — 1(a) (1).) (Emphasis added.)

The word “knowingly” was omitted from the complaint in the instant case.

In support of his contention, defendant cites People v. Hayn (1969), 116 Ill.App.2d 241, 253 N.E.2d 575, where the court reversed a conviction for theft by receiving stolen property because the indictment was defective. Defense counsel in that case moved to dismiss the indictment but the trial court denied his motion. The indictment there did use the word “knowingly” to describe the criminal act involved but it failed to allege the requisite mental state under subsections (1), (2), or (3) of the statute.

In the instant case, defense counsel made no objection to the form of the complaint and the testimony of Mark Scott did indicate that the act was committed “knowingly.” Moreover, the requisite mental state of “knowingly” having done something may be considered as having been covered in this case by the allegation in the complaint that defendant had obtained unauthorized control over the property “with the intent to deprive said Thomas Delaney permanently of the use and benefit of said property.” Under these circumstances we believe that the complaint was not fatally defective.

Defendant secondly contends that the court erred by not determining the competence of a thirteen year old witness before permitting him to testify. However, this point is raised for the first time on appeal. There having been no objection interposed to the competency of this witness at the trial, the error alleged has not been preserved for review. People v. Matthews (1959), 17 Ill.2d 502, 506, 162 N.E.2d 381, 384; People v. Mueller (1954), 2 Ill.2d 311, 315, 118 N.E.2d 1, 3.

Defendant thirdly contends that the evidence admitted at trial failed to establish that he exercised unauthorized control over the victims property. Lack of authority to exercise control over the property of another is an element of the offense of theft. (Ill. Rev. Stat. 1969, ch. 38, sec. 16 — 1(a)(1).) The State, not defendant, has the burden to prove this element of the offense of theft, as all other elements, beyond a reasonable doubt. (Ill. Rev. Stat. 1969, ch. 38, sec. 3 — 1.) However, the victim of a crime need not testify in order to establish guilt beyond a reasonable doubt. (People v. Jolliff (1964), 31 Ill.2d 462, 463-464, 202 N.E.2d 506, 507.) In the instant case, the uncontroverted testimony of the State’s occurrence witness establishes that defendant struck the victim both before and after taking his property. We believe this testimony proves the element of lack of authority to exercise control over the victim’s property beyond a reasonable doubt, especially where, as here, the evidence indicates an inability of the victim to communicate.

Defendant lastly contends that the court erred in relying on a subsequent offense not charged in the complaint. This testimony related to defendant’s return (after taldng the $5.00) to strike the victim again, empty his pockets and take some change. Evidence of a subsequent offense unrelated to the offense charged is generally inadmissible in a criminal case. (Farris v. People (1889), 129 Ill. 521, 531, 21 N.E. 821, 823.) However, an objection at trial is normally necessary to preserve an issue for review. (People v. Dickman (1969), 117 Ill.App.2d 436, 440, 253 N.E.2d 546, 548.) In the instant case, not only does the subsequent offense appear related to the offense charged, but no objection to such testimony was raised at trial.

For the reasons heretofore mentioned, the decision of the trial court is affirmed.

Affirmed.

DRUCKER, P. J„ and ENGLISH, J., concur.


text:
    The People of the State of Illinois, Respondent-Appellee, v. Russell Smith, Petitioner-Appellant.
    (No. 57309;
    First District (5th Division)
    February 16, 1973.
    Gerald W. Getty, Public Defender, of Chicago, (Richard S. Fling, Assistant Public Defender, of counsel,) for appellant.
    Edward V. Hanrahan, State’s Attorney, of Chicago, (Irvin Robbins, Assistant State’s Attorney, of counsel,) for the People.
   PER CURIAM.


text:
    The People of the State of Illinois, Plaintiff-Appellee, v. Harold Harrison, Defendant-Appellant.
    (No. 58049;
    First District (5th Division)
    February 16, 1973.
    James J. Doherty, Public Defender, of Chicago, (Edward A. Ptacek, Assistant Public Defender, of counsel,) for appellant.
    Edward V. Hanrahan, State’s Attorney, of Chicago, (Michael Simkin, Assistant State’s Attorney, of counsel,) for the People.
   PER CURIAM.


author: Mr. JUSTICE McNAMARA

text:
    La Salle National Bank, as Trustee under a certain Trust Agreement, et al., Plaintiffs-Appellees, v. The City of Evanston, Defendant-Appellant.
    (No. 55317;
    First District (3rd Division)
    December 28, 1972.

      Modified upon denial of rehearing March 15, 1973.

      Jack M. Siegel, Corporation Counsel, of Evanston, for appellant.
    Pedersen & Houpt, and Morgan, Lanoff, Cook & Madigan, both of Chicago, (Richard V. Houpt, James K. Stucko, and Samuel M. Lanoff, of counsel,) for appellees.
   Mr. JUSTICE McNAMARA

delivered the opinion of the court as modified on the denial of the petition for rehearing:

Plaintiffs, La Salle National Bank, as trustee, and the James Investment Corporation, as beneficial owner of certain real estate located in Evanston, brought this declaratory judgment action against the defendant, City of Evanston, seeking a declaration that defendant’s zoning ordinance was unconstitutional and void as applied to plaintiffs’ property. After hearing evidence, the trial court entered judgment declaring the height and density restriction of defendant’s zoning ordinance to be invalid as it prevented the plaintiffs from developing their property as proposed. On appeal defendant contends that plaintiffs failed to overcome the presumptive validity of the zoning ordinance in question; that the zoning ordinance as applied to the subject property is a valid exercise of legislative authority; and that plaintiffs failed to exhaust their administrative remedies before bringing the instant action.

The subject property is located at 1746 Hinman Avenue, on tire southwest corner of Clark Street and Hinman in Evanston. The property is vacant, consists of approximately 52,800 square feet, and is located almost equidistantly between the downtown business district, the Northwestern University campus and a public park facing Lake Michigan.

Plaintiffs purchased the property in 1952 for $50,000. At the time, it was improved with a single-family home and coachhouse, and was zoned R-l, a single-family use. Plaintiffs demolished the home in 1956 and the coachhouse in 1967. Prior to its demolition, the coachhouse was rented as two units at a total $300 monthly income.

In 1960, under a comprehensive amendment, tire property again was classified as R-l. In 1968, plaintiffs, along with other owners of property on both sides of Hinman Avenue, sought a change of zoning from the R-l classification to R-7, which would permit the erection of a 125 unit apartment building to a height of 85 feet. The Zoning Committee recommended that both sides of Hinman between Clark and Church Streets be reclassified R-5A. In 1969, the City Council amended the zoning ordinance by reclassifying only the west side of Hinman, including the subject property, to R-5A. Under R-5A, the property could be developed for multi-family use to a height of three stories with a maximum number of 42 residential units. Plaintiffs brought this declaratory judgment action, and the trial court held that the zoning ordinance was void as it prohibited plaintiffs from erecting a structure containing 114 apartments 85 feet in height.

The west side of the block in which the subject property is located is zoned R.-5A. Immediately south of the subject property is a single-family home with a coachhouse. Directly south of that is the Sigma Chi Foundation, national headquarters of a fraternity. South of that is the three-story University Club. No other buildings are on the west side of the block. On the east side of Hinman, still zoned R-l, are seven single-family residences and a building used by a church as a student religious center. The block to the east of these homes is also zoned R-l; however, it contains no single-family residences, but rather a sorority house, the Northwestern Training Institute and a B’nai B’rith Foundation Building.

The property immediately to the west, separated from the subject property by an alley, is zoned R-7. Immediately south of that property is a city parking lot, which occupies the remainder of the block, and is also zoned R-7. The block to the west of the subject property is also zoned R-7 and contains the public library, several institutions and an apartment building of the same height as that proposed by plaintiffs.

The first full blocks south of the subject property are zoned R-7 on both the east and west sides of Hinman. These contain, among other structures, hotels and apartment buildings with the same height and density as that proposed by plaintiffs. To the southwest of the subject property are business districts, including a bank 20 stories high.

The blocks north of the subject property are zoned U-2. A U-2 classification refers to dwellings owned or operated by a college or university. Such a classification permits buildings to a height generally of 35 and under certain circumstances of 50 feet. A density of residential units twice that permitted under R-5A, is allowed. These blocks to the north of the subject property consist primarily of businesses and offices related to Northwestern University, including classrooms, business offices, sorority house, chapel and school library.

Additionally, the following pertinent testimony was adduced at the hearing. Kenneth James, vice-president of the plaintiff beneficial owner, testified that plaintiffs proposed to erect a building 85 feet high with 114 apartments, including 18 one-bedroom apartments, 78 two-bedroom apartments, and 18 three-bedroom apartments. There would be 114 parking spaces provided, 85 of which would be indoors.

George Kranenberg, a planning and zoning consultant, testified for plaintiffs that in his opinion the highest and best use of the subject property was for multiple use under R-7. He based his opinion upon the presence of contiguous business districts and upon the public and quasi-public uses related to the university. He stated that the remaining single-family residences in the area were out of character with the neighborhood, and that the proposed R-7 use would not depreciate those single-family residences.

James E. Wolfe, a real estate broker and appraiser, testified for plaintiffs that in his opinion the highest and best use for the property was R-7. Zoned as R-5A, tire property had a value of $350,000, and, if zoned R-7, it would have a value of $790,000.

Wayne F. Anderson, City Manager of the City of Evanston, was called by the plaintiffs as an adverse witness under Section 60. He testified that the city had no current plans for developing the parking lot west of the subject property, but that the city did receive and consider proposals from several parties concerning development of the lot.

George Anton, an appraiser, testified for plaintiffs that the property, zoned as R-5A, had a value of $350,000, while, if zoned R-7, it would have a value of $1,000,000. He based his opinion upon the sale of similar multi-family dwellings in the area.

Richard Carter, defendant’s Director of Planning, testified that in his opinion the highest and best use of the property would be as R-5A. He based his opinion on the use of the surrounding area and defendant’s practice of grading downward the height of buildings from the center of the city to the lakefront. Carter also testified that defendant had no present plans to develop the parcel for development of the city parking lot, zoned R-7 and adjacent to the subject property. He further testified that, in his opinion, the plaintiffs’ proposed use would be detrimental to the other property in the area, and would create traffic problems.

F. Gregory Opelka, an appraiser, testified for defendant that the single-family homes across the street from this property ranged in value from $40,000 to $70,000, and that the proposed use of R-7 would diminish their value from 5% to 10%. He also testified that the subject property had a value of $300,000 as presently zoned, and that it would be worth $550,000 to $600,000 if zoned R-7. Opelka further testified that the property was suitable for development under the present R-5A zoning.

Patrick W. O’Brien, an Evanston resident, a lawyer, a dealer in realty, and a member of the Southeast Evanston Association, also testified for the defendant. He explained that the Southeast Evanston Association is an organization dedicated to preserving the residential nature of Southeast Evanston. It was his opinion that the plaintiffs’ proposed use of the subject property would be des tractive of the residential character of the area.

William Lawrence, city planning and zoning consultant, testified that the proposed R-7 use of the subject property would be detrimental to the area. He further testified that the present R-5A zoning of the subject property was a reasonable transition from the abutting R-7 and R-l areas.

A determination of defendant’s first two contentions, that plaintiffs failed to overcome the presumptive validity of the zoning ordinance and that the zoning ordinance as applied to the subject property is a valid exercise of legislative authority, requires a consideration of the same legal principles. Consequently, we will consider both arguments together. Moreover, both sides presented evidence that the highest and best use for the property was multiple family residential. The only point at issue between the parties is one of height of structure and density of use.

In an action to prevent the enforcement of a zoning ordinance as to a particular piece of property, the moving party faces the burden of proving by clear and convincing evidence that the application of the ordinance is arbitrary and unreasonable, and that it has no substantial relation to the public health, safety and welfare. (Exchange National Bank of Chicago v. County of Cook, 25 Ill.2d 434, 185 N.E.2d 250.) The enactment of the ordinance is always presumed to be valid. (Jacobson v. City of Evanston, 10 Ill.2d 61, 139 N.E.2d 205.) The presumption of the ordinance’s validity, however, is overcome when the evidence shows a destruction of property value in the application of the ordinance and an absence of any reasonable basis in public welfare requiring the restriction and resultant loss. (First National Bank & Trust Co. of Evanston v. County of Cook, 15 Ill.2d 26, 153 N.E.2d 545.) In order to sustain the validity of zoning enactments, there must be a real and substantial relation to the public health, safety and morals or general welfare. (Hannifin Corp. v. City of Berwyn, 1 Ill.2d 28, 115 N.E.2d 315.) In Polivka v. County of Cook, 68 Ill.App.2d 377, 216 N.E.2d 221, this court, at p. 381, stated:

“A zoning ordinance, although reasonably designed to protect public health, safety or welfare, cannot in such guise effect an arbitrary discrimination against the class upon which it operates by omitting from its coverage properties similarly situated.”

The six familiar factors to be considered by a court in determining the validity of zoning were set forth by the Supreme Court in La Salle National Bank of Chicago v. County of Cook, 12 Ill.2d 40, 145 N.E.2d 65:

"(1) The existing uses and zoning of nearby property;
(2) The extent to which property values are diminished by the particular zoning restrictions;
(3) The extent to which the destruction of plaintiff’s property values promote the health, safety, morals or general welfare of the public;
(4) The relative gain to the public as compared to the hardships imposed on the individual owner;
(5) The suitability of the subject property for the zoned purposes;
(6) The length of time the property has been vacant as zoned considered in the context of land development of the area in the vicinity of the subject property.”

And in weighing these factors, primary importance should be given to the conformity of the zoning restrictions on the subject property with existing uses and zoning restrictions applicable to surrounding properties. Guaranty Bank and Trust Co. v. City of Chicago, 112 Ill.App.2d 378, 251 N.E. 2d 384.

When the zoning classification of the subject property is viewed under the foregoing criteria and principles of law, we believe that the trial court correctly held that the presumptive validity of the ordinance has been overcome, and that the height and density restrictions of the R-5A classification, as applied to this property, were arbitrary and unreasonable and in no way promoting the public health, safety or welfare. In reaching that conclusion, we view the uses and zoning of the surrounding area as being of primary significance. The record, particularly the exhibits, reveals that the area has been found to be suitable for a blend of commercial, institutional and multiple family residential uses. In the block south of the subject property, the property is zoned R-7 and contains hotels and apartment buildings of the same height and density as plaintiffs’ proposed use. Immediately west of the subject property, the land, including a parking lot owned by defendant, is zoned R-7. It is important to note that in the past defendant has considered proposals to have that property developed in the same manner as proposed by plaintiffs for the subject property. The entire block to the west of the parking lot is zoned R-7 and contains an apartment building, library and office. To the north of the subject property is a mixture of businesses and offices relating to the University. Although these buildings are restricted to 50 feet in height, a greater density per unit is permitted than in plaintiffs’ proposed use. The block to the east of the subject property is zoned R-l, but contains a group of non-conforming uses, including a sorority house. Only across the street to the east of the subject property are there any single-family residences, and even on that street a student religious center is located. We believe that, when the uses and applicable zoning regulations in the surrounding area are thus examined, it becomes apparent that the height and density requirements imposed upon plaintiffs’ property by the ordinance are unwarranted, and that plaintiffs’ proposed use would not change substantially the public welfare in the area.

To show an ordinance unreasonable and arbitrary in its application, it is not necessary that the property be totally unsuitable to the use for which it is classified. It is sufficient that a substantial decrease in value results from a classification bearing no substantial relation to the public welfare. (First National Bank and Trust Co. of Evanston v. County of Cook, supra.) Defendant concedes in its brief that, if plaintiffs’ proposed development were permitted, the subject property would have a value to two or three times greater than its present value. It argues, however, that plaintiffs’ proposed use would cause considerable loss in value to the owners of the single-family residences to the east of the subject property. If Opelka’s testimony of a 5% to 10% depreciation in value to those homes were accepted, the monetary loss to those owners would be significant. However, in light of the limited effect plaintiffs’ proposed use would have on the area’s general welfare and in view of the admitted substantial financial loss imposed on plaintiffs by the ordinance, the depreciation in value to those few single-family residences could not be controlling. Moreover, we find persuasive the testimony of plaintiffs’ witnesses that the homes in question have been fully depreciated by the varied uses already permitted in the neighborhood.

We find no merit in defendant’s final contention that plaintiffs failed to exhaust their administrative remedies before seeking judicial review. Plaintiffs joined with the other owners in seeking to have the entire block of 1700 Hinman Avenue rezoned as R-7. The zoning committee recommended an R-5A classification for the entire block. The City Council approved an R-5A classification for the west side of the street only, including the subject property. Since the proposed zoning classification of R-7 was squarely before the City Council, it was not necessary for plaintiffs to again present that issue to the Council before filing suit.

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

Judgment affirmed.

DEMPSEY, P. J., and McGLOON, J., concur.


author: Mr. JUSTICE EGAN.

text:
    William F. Ryan, Plaintiff-Appellee, v. Jerry G. Wagner, Defendant-Appellant.
    (No. 55194;
    First District (1st Division)
    January 29, 1973.
    Richard S. McKay, of Law Office of Joseph Udoni, of Chicago, (Joseph B. Lederleitner, of counsel,) for appellant.
    McGuire & Haney, of Chicago, for appellee.
   Opinion by

Mr. JUSTICE EGAN.