author: Mr. JUSTICE WILSON

text:
    MUNASSER M. SAEED, Plaintiff-Appellee, v. BANK OF RAVENSWOOD, Trustee, et al., Defendants.—(ORESTIS TSALAPATANIS et al., Defendants-Appellants.)
    First District (5th Division)
    No. 80-1723
    Opinion filed October 16, 1981.

      James R. Galvin and Emmett J. Galvin, both of Flynri, Galvin & Ryan, of Chicago, for appellants.
    Warren Mark and Richard L. Gerber, both of Warren Mark, P. C., of Chicago, for appellee.
   Mr. JUSTICE WILSON

delivered the opinion of the court:

Plaintiff brought this negligence action to recover for personal injuries suffered in a fall on defendants’ property. The complaint was dismissed with prejudice on defendants’ motion for sanctions because of plaintiff’s failure to comply with discovery requests. The trial court denied plaintiff’s subsequent motion to vacate the dismissal but later granted plaintiff’s petition, under section 72 of the Civil Practice Act, to vacate the dismissal. Defendants appeal from this order, contending that the section 72 petition was insufficient as a matter of law and that the court abused its discretion in granting the petition. We affirm the trial court.

On April 22, 1977, plaintiff filed a complaint for damages based on injuries he sustained when he fell in defendants’ apartment building. Defendant Bank of Ravenswood has title to the building, which is held in an Illinois land trust. On May 17, 1977, the Bank was dismissed from the lawsuit pursuant to its section 48 motion. (Ill. Rev. Stat. 1977, ch. 110, par. 48.) The basis for the motion was that the Bank had no right, power, or authority to manage the real estate but merely held legal title. Subsequently, plaintiff was granted leave to amend his complaint to add Orestis and Anna Tsalapatanis, the beneficial owners, as party defendants.

Both sides had served and answered interrogatories by October of 1977. Plaintiff’s deposition was rescheduled, at his attorney’s request, several times from November 1977 through November of 1978. On November 24, 1978, plaintiff’s attorney informed defendants’ attorney that plaintiff had left the country and that he was unsure when his client would return. The attorneys agreed to reset plaintiff’s deposition for May 9, 1979.

On May 7, 1979, plaintiff’s counsel asked for another continuance because his client was still out of the country. Defendants’ attorney agreed to the continuance as long as plaintiff’s attorney informed him of a new date no later than May 11,1979. By May 30,1979, however, the deposition had not been re-scheduled and defendants’ attorney moved to dismiss the action.

The hearing on defendants’ motion to dismiss was set for June 21, 1979, but was subsequently continued to July 9,1979.

On July 9,1979, the court entered an order stating that “plaintiff shall be present for deposition on August 31, 1979” at defendants’ attorney’s office and that “failure of plaintiff to comply with this order shall result in the automatic dismissal of his cause with prejudice.”

Plaintiff, who was still in Arabia, failed to appear for the August 31 deposition. Thereafter, defendants filed a motion to dismiss the complaint with prejudice. On September 19, 1979, the court granted the motion.

On October 12, 1979, the court considered plaintiff’s motion to vacate the dismissal order. Plaintiff’s counsel advised the court that plaintiff was still in Crater Aden, Arabia, tending to family problems and fully intended to return within 60 days to prosecute his case. The trial court denied the motion, however, stating that no new evidence had been presented that would warrant vacation of the order.

Plaintiff returned to this country in late December of 1979 or early January. On February 11,1980, he filed a section 72 petition seeking relief from the dismissal of his complaint. (Ill. Rev. Stat. 1979, ch. 110, par. 72.) Defendants were granted leave to respond and on March 5, 1980, they filed a motion to dismiss the petition as being insufficient in fact and in law.

On May 15, 1980, after a hearing, the trial court granted plaintiffs section 72 petition and vacated the prior dismissal order. Defendants appeal from the May 15,1980, order.

Opinion

Defendants’ argument is threefold: (1) The trial court lacked jurisdiction over plaintiff’s section 72 petition; (2) the petition itself is inadequate as a matter of law because it fails to allege the necessary factual matters giving rise to plaintiff’s claim for relief; (3) plaintiff’s reinstated tort action is barred under the principles of res judicata because the September 19, 1979 dismissal order, as a sanction for failure to comply with discovery (Supreme Court Rule 219(c)), operated as an adjudication on the merits under Supreme Court Rule 273 (Ill. Rev. Stat. 1979, ch. 110A, pars. 219(c), 273). We reject all three contentions.

I

Defendants’ jurisdictional argument is based on the rule that the trial court loses the authority to reinstate an action or amend or vacate its final orders after 30 days from the entry of such order. (Ill. Rev. Stat. 1979, ch. 110, par. 68.3; Green v. Wilmot Mountain, Inc. (1980), 92 Ill. App. 3d 176, 415 N.E.2d 1076.) Defendants contend that because the section 72 petition is legally insufficient, it could not confer jurisdiction on the court to reconsider its September 19 dismissal order. Therefore, the May 5,1980, order is void, and the dismissal order must stand. They further argue that plaintiff’s proper course of action following the denial of his October 12, 1979, motion to vacate the dismissal would have been to take an appeal from that order.

This theory, we believe, misapprehends the jurisdictional issue. A section 72 petition is considered to be the filing of a new action and is subject to the usual rules governing civil cases. (Brockmeyer v. Duncan (1960), 18 Ill. 2d 502, 165 N.E.2d 294.) Here, there is no question that defendants were served with proper notice or that the court lacked subject matter jurisdiction. The real question is whether a section 72 petition alleges a cause of action or sufficient facts to demonstrate the petitioner’s right to relief. If not, the trial court should dismiss the petition {Brockmeyer), and its failure to do so would presumably be an abuse of discretion. Conversely, if the petition is legally sufficient, the trial court has discretionary power to grant the requested relief, and generally will do so unless, for example, the petitioner fails to establish due diligence. See American Reserve Corp. v. Holland (1980), 80 Ill. App. 3d 638, 644, 400 N.E.2d 102,107 (although petitioner stated a meritorious defense, he failed to allege facts showing his diligence in both defending the cause and filing the section 72 petition); but cf. Reuben H. Donnelley Corp. v. Thomas (1979), 79 Ill. App. 3d 726, 729-30, 398 N.E.2d 972, 975 (the equitable nature of section 72 relief allows courts to vacate judgments, where justice and fairness require it, “even though the requirement of due diligence has not been satisfied”).

In the present case, the trial court had jurisdiction over the section 72 petition. Our review of its May 15, 1980, order granting plaintiff’s relief, therefore, is limited to considering the sufficiency of the petition and determining whether the court abused its discretion in vacating its dismissal order.

II

Section 72 of the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 72) permits relief, under certain circumstances, from final orders or judgments after 30 days from the date of their entry, up to two years thereafter. Relief under this section is equitable in nature and its award rests in the sound discretion of the trial court. (Davis v. Chicago Transit Authority (1980), 82 Ill. App. 3d 987, 403 N.E.2d 615; Geller v. General Motors Corp. (1980), 87 Ill. App. 3d 972, 410 N.E.2d 262.) Generally, a legally sufficient petition must demonstrate the existence of a meritorious claim or defense and the petitioner’s “due diligence” in pursuing his right to relief. (Windmon v. Banks (1975), 31 Ill. App. 3d 870, 335 N.E.2d 116.) The general purpose of a section 72 petition is to bring before the court matters not appearing on record which, if known to the court at the time the original judgment was entered, would have prevented its entry. (Brockmeyer v. Duncan (1960), 18 Ill. 2d 502, 165 N.E.2d 294; American Reserve Corp. v. Holland (1980), 80 Ill. App. 3d 638, 400 N.E.2d 102.) It has been noted that these “new facts,” extraneous to the record, must relate to matters which antedate the rendition of judgment and not those arising after the judgment is entered. Russell v. Klein (1974), 58 Ill. 2d 220, 317 N.E.2d 556.

Defendants’ primary challenge to the legal sufficiency of the petition is that it fails to set out any factual material, in existence at the time the dismissal order was entered, that would have allowed the court to grant plaintiff relief. The only “new fact” alleged in the petition that was not before the trial court when it entered the dismissal order was plaintiff’s physical presence in the United States. Defendants agree that in a general sense plaintiff’s return to Cook County is a new fact; however, they argue that it clearly arose subsequent to the entry of judgment. According to Russell v. Klein (1974), 58 Ill. 2d 220, 317 N.E.2d 556, therefore, defendants argue that plaintiff’s return is not a sufficient new fact to permit section 72 relief. For support, they quote the following language from Russell:

“We conclude that the clearly demonstrated intent of the statute requires us to hold that the remedy contemplated by section 72 is available for relief based on matters which antedate the rendition of the judgment and not those which arise subsequent to its rendition.” 58 Ill. 2d 220, 225, 317 N.E.2d 556, 559.

Defendants’ reliance on this quotation demonstrates the danger inherent in taking a statement out of context and applying it in a strictly literal sense to a different situation. The main issue in Russell was whether section 72 should be construed as the exclusive remedy for all types of post-judgment relief, such that the two-year limitation would likewise apply.

The plaintiff in Russell obtained a judgment by confession against defendants on September 23, 1966. On June 9,1970, approximately four years later, defendants filed a motion to vacate the judgment on the grounds that it had been satisfied by a fully performed oral agreement between the parties. The motion to vacate was amended to reflect that the motion was actually for satisfaction of judgment. On March 24, 1972, the trial court granted defendants’ request for relief, ruling that plaintiff’s judgment had been satisfied. The appellate court reversed this judgment, however, holding that defendants’ remedy was barred by the two-year limitation of section 72. This conclusion was premised on the belief that defendants’ post-judgment relief, formerly provided by the writ of audita querela, was wholly encompassed by section 72, which expressly abolishes various common law writs and replaces them with the single statutory remedy under section 72.

On appeal, the supreme court rejected this reasoning, which would have left the judgment debtor without a remedy, and reversed the appellate court. In reviewing the history of the audita querela writ, the supreme court noted that it provided the judgment debtor, at common law, with a mode of relief in two situations. First, the writ could be used to obtain relief from the consequences of a judgment on account of matters arising after its rendition, as in discharge or satisfaction of the judgment. Second, the writ could be used to present to the court facts existing prior to judgment which the debtor was unable to assert because of the creditor’s fraud. Russell, 58 Ill. 2d 220, 223, 317 N.E.2d 556, 558.

If the Russell court accepted the plaintiff’s position that section 72 became the exclusive remedy for judgment debtors because it wholly replaced the writ of audita querela, the court would have had to apply the two-year limitation of section 72. In rejecting this result the court emphasized the equitable nature of section 72. The court then stated that the statute was meant to apply to matters which antedate a judgment rather than those which arise subsequently. We believe a fair reading of this statement, in context, is that the writ of audita querela is encompassed by section 72 to the extent that the relief sought pertains to matters in existence before the judgment. Where the judgment debtor seeks relief based on matters arising subsequent to judgment, however, the two-year limit of section 72 is inapplicable. Thus, the supreme court concluded that the seven-year limitation embodied in the judgments act (Ill. Rev. Stat. 1971, ch. 77, par. 1 et seq.) should be applied to the case before it. Consequently, the judgment debtor’s right to post-judgment relief was not barred by the passage of four years from the time of the original judgment to his filing of an action for relief.

We believe that the Russell court’s concern was to ensure that the equitable principles of section 72 were not controverted by a narrow construction that would result in the elimination of any relief which was formerly available under the common law writs. The pending case, however, involves a different aspect of the scope of relief under the statute. Several authorities support the approach that the factual matters in a section 72 petition should be viewed as part of the total circumstances surrounding the original judgment. Thus, reviewing courts have considered facts occurring subsequent to a judgment, such as a plaintiff’s conduct in concealing the entry of a judgment or in delaying the execution on a default judgment until after 30 days from its entry. See Davis, The Scope of Section 72 of the Civil Practice Act, 55 Ill. B.J. 820, 825 (1967), citing, e.g., Bell Auto Repair & Painting Corp. v. Henderson (1966), 73 Ill. App. 2d 234, 219 N.E.2d 642; Elfman v. Evanston Bus Co. (1963), 27 Ill. 2d 609, 190 N.E.2d 348; see also Ellman v. De Ruiter (1952), 412 Ill. 285, 106 N.E.2d 350, subsequently codified in amendment to section 72 (1955 Ill. Laws 2238, §1).

More recent support for allowing the reinstatement of plaintiff’s action are cases which have slightly relaxed the “due diligence” requirement in order to achieve a just result. In Geller v. General Motors Corp. (1980), 87 Ill. App. 3d 972, 410 N.E.2d 362, we allowed the reinstatement of an action more than 30 days following its dismissal for want of prosecution. We noted that although the plaintiff was “in error for failing to follow the case, under the circumstances e ” reinstatement of the case was a just result” and it was therefore reasonable to require the defendant to go to trial on the merits. Geller, 87 Ill. App. 3d 972, 976, 410 N.E.2d 362, 365; see also Windmon v. Banks; Reich v. Breed (1979), 70 Ill. App. 3d 838, 388 N.E.2d 994.

In the pending case, plaintiff was not entirely “free of error” in the sense that, as defendants argue, he could have flown in from Arabia to give his deposition and then flown back to settle his family problems. This indeed would indicate a scrupulous attention to one’s duty to follow his case. We do not believe, however, that the law exacts such measures, especially where, as here, there appears to be no real prejudice accruing to defendants. We conclude that the statutory remedy under section 72 is flexible enough to permit plaintiff, under the instant circumstances, to have his day in court.

Ill

As an alternative or cumulative argument, defendants suggest that because the September 19, 1979, dismissal order was imposed for failure to comply with discovery, it operated as an adjudication on the merits under Supreme Court Rule 273 (Ill. Rev. Stat. 1979, ch. 110A, par. 273). Accordingly, the reinstatement of plaintiff’s action would circumvent the res judicata effect of such an adjudication. For support, defendants cite cases decided under section 24 of the Limitations Act, which provide that a plaintiff whose action is dismissed for one of five reasons may refile his action within one year of the dismissal order. (Ill. Rev. Stat. 1979, ch. 83, par. 24a.) If an action is dismissed for want of prosecution, for example, the plaintiff can refile within one year, even if the original statute of limitations has run prior to service of process on the defendant. (Green v. Wilmot Mountain, Inc. (1980), 92 Ill. App. 3d 176,415 N.E.2d 1076.) If the dismissal is a sanction for failure to comply with discovery, however, the courts have held that the action cannot be refiled under section 24 of the Limitations Act, because such a dismissal is not one of the express categories that allow refiling. See Keilholz v. Chicago & North Western Ry. Co. (1974), 59 Ill. 2d 34, 319 N.E.2d 46; Brewer v. Moore (1978), 67 Ill. App. 3d 487, 385 N.E.2d 73.

In Keilholz, the plaintiff failed to appear for a pretrial conference in violation of a previous court order and the trial court dismissed the suit for noncompliance with Supreme Court Rules 218 and 219 (Ill. Rev. Stat. 1971, ch. 110A, pars. 218, 219). The plaintiff did not appeal from this dismissal but instead filed a new action after the pertinent statute of limitations had expired. This second action was then dismissed and plaintiff appealed from that order. The Illinois Supreme Court affirmed the trial court, holding that dismissal of the original suit for noncompliance with the Supreme Court Rules barred plaintiff from refiling under section 24 of the Limitations Act because such dismissal was not, as the appellate court had held, “for want of prosecution.” Instead, it was a dismissal based on grounds other than those which allow refiling under section 24.

In Brewer v. Moore, which defendants argue is “directly on point,” the plaintiff had failed to comply with discovery requests and defendant obtained a dismissal of the cause with prejudice. When plaintiff’s subsequent motion to vacate was heard, the trial court modified its own order to read that the dismissal was for “want of prosecution,” thus enabling plaintiff to refile his suit. Defendant moved for dismissal of the second suit on the grounds that it was barred by the involuntary dismissal of the first action. On appeal, we held that the dismissal of the original action was caused by plaintiff’s indifference to his suit and that the trial court should not have modified its order. Since the dismissal was imposed as a sanction for failure to comply with the trial court’s orders, we found that the dismissal was a bar to refiling under the Limitations Act.

Defendants urge us to adopt the reasoning of Keilholtz and Brewer and hold that plaintiff’s action should not be reinstated because it was dismissed for noncompliance with discovery. We are not persuaded by defendants’ analogy, however; the requirements and purposes of the Limitations Act are clearly distinct from those of section 72 of the Civil Practice Act. Therefore, the cited cases are not controlling authorities in the present case.

We believe that the trial court dismissed plaintiff’s action on September 19, 1979, because of plaintiff’s failure to appear due to his absence from the country. The court noted that there was no way of determining when or if plaintiff would return. Subsequently, the trial court also denied the motion to vacate the dismissal order, finding that there had been no change of circumstances. When plaintiff filed his section 72 petition, however, he had returned from Arabia and was ready and able to proceed with his lawsuit. At the hearing on the petition, the trial court heard arguments of counsel and read memoranda of law before granting plaintiff’s requested relief. We cannot say this was an abuse of discretion merely because the original dismissal was based on plaintiff’s failure to appear for his deposition. In effect, the dismissal order was nullified by the trial court’s subsequent ruling that plaintiff stated a cause of action pursuant to section 72.

Moreover, the Illinois Supreme Court has recently emphasized that discovery should be used to ascertain the merits of the case and promote a fair resolution of the controversy. In Williams v. A. E. Staley Manufacturing Co. (1980), 80 Ill. App. 3d 981, 400 N.E.2d 724, rev'd (1981), 83 Ill. 2d 559, 416 N.E.2d 252, the supreme court affirmed the trial court’s order which allowed plaintiff to reinstate his suit approximately two months following the initial dismissal of the action for failure to supply documents to defendant. The supreme court’s specific ruling was based on defendant’s failure to make a reasonable attempt to resolve the discovery problem before seeking judicial intervention pursuant to Supreme Court Rule 201 (k) (Ill. Rev. Stat. 1979, ch. 110A, par. 201 (k)), which is not an issue in the pending case. The result of the Staley decision, however, was to permit the reinstatement of plaintiff’s action despite the possibility that the dismissal order could be viewed, technically, as an adjudication upon the merits under Supreme Court Rule 273.

We conclude that plaintiff’s failure to comply with the deposition order, under the circumstances, was not an unreasonable, deliberate attempt to flout the court’s order or evade discovery. (See White v. Henrotin Hospital Corp. (1979), 78 Ill. App. 3d 1025, 398 N.E.2d 24.) In light of the plaintiff’s return to the country and his diligent attempts to proceed under section 72, therefore, we hold that the trial court did not abuse its discretion in granting plaintiff’s petition and denying defendant’s motion to dismiss. Therefore, we affirm the trial court’s order vacating its September 19, 1979, dismissal order and reinstating plaintiff’s action.

Affirmed.

LORENZ and MEJDA, JJ., concur.

       Under the newly enacted Code of Civil Procedure (Act of August 19, 1981, Pub. Act 82-280, 1981 Ill. Legis. Serv. 1031 (effective July 1, 1982)), reference to audita querela is removed from the current section 72 (which will be renumbered as section 2 — 1401 of the Code) and the relief formerly available under the writ is dealt with in new section 12 — 183, which is entitled “Release of Judgment.” See 1981 Ill. Legis. Serv. 1194.

       Our decision is not meant to excuse future litigants who may abuse section 72 relief. We reaffirm the established principles that the statute does not relieve a party of his own negligence or allow him to re-litigate matters. (American Reserve Corp. v. Holland.) It is not a substitute for an appeal of the merits but it is a remedy in addition to that of an appeal and both may be followed simultaneously. See Davis, The Scope of Section 72 of the Civil Practice Act, 55 Ill. B.J. 820 (1967); Johnson v. Thomas (1966), 75 Ill. App. 2d 407, 411, 221 N.E.2d 44, 46.


source: Caselaw Access Project

author: Mr. JUSTICE LINN Mr. JUSTICE JIGANTI

license: Public Domain

text:
    VULCAN MATERIALS COMPANY, Plaintiff, v. BEE CONSTRUCTION CO., INC., et al., Defendants.—CENTRAL STATES CONSTRUCTION CO., INC., Plaintiff, v. BEE CONSTRUCTION CO., INC., Defendant.—(WANER HEATING AND AIR CONDITIONING CORP., Defendant and CounterplaintiffAppellant, v. CHICAGO TITLE INSURANCE COMPANY, Defendant and Counterdefendant-Appellee.)
    First District (4th Division)
    Nos. 80-1694, 80-1695 cons.
    Opinion filed October 1, 1981.
    — Rehearing denied November 12, 1981.

      JIGANTI, J., dissenting.
    Alan L. Stefaniak, Eugene A. DiMonte, and Gary L. Goldblatt, all of DiMonte, Baker & Lizak, of Chicago, for appellant.
    Robert S. Cushman, Minard E. Hulse, Jr., and Stuart Finkle, all of Keck, Mahin & Cate, of Chicago, for appellee.
   Mr. JUSTICE LINN

delivered the opinion of the court:

Two cases brought from the circuit court of Cook County are consolidated here. Though both cases involve multiple parties, only Waner Heating and Air Conditioning Corp. has brought this appeal. In both cases, Waner sought to foreclose two mechanics’ liens on property located in the Village of Niles and commonly known as the Green Lakes Shopping Center. The liens were allegedly valued at approximately $22,000 and were created as a result of materials supplied to and services performed on the property by Waner between 1974 and 1976.

In both cases, Waner’s claims were dismissed pursuant to a motion filed by appellee, Chicago Title Insurance Company. Chicago Title is the holder of tax deeds issued on the property by the County Clerk pursuant to an order of court entered in November 1979 under section 266 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 747). Essentially, Waner’s claims were dismissed because the trial court found that the tax deeds represented superior and merchantable title in Chicago Title and that the tax deeds, when issued, extinguished Waner’s mechanics’ liens. From the orders of dismissal, Waner appeals.

We reverse and remand.

Background

All of the significant facts in this case are undisputed for the purpose of this appeal. In 1972, the legal title holder of the property involved in this dispute was American National Bank and Trust Company. American National was simply a land trustee whose beneficiary was Morris Suson. Apparently in 1972, the construction of the shopping center began with a company allegedly owned by Suson acting as the developer and general contractor. Though it appears the shopping center was substantially completed, the center never went into successful operation. As a result, Suson failed to pay many of the subcontractors, including Waner, for their materials and services. One of the cases below was originally brought in 1973 by another subcontractor, Vulcan Materials Company, to foreclose on its mechanics’ lien. Waner intervened in this action in 1976 and filed its mechanics’ lien claims.

Suson also defaulted on a $7,000,000 construction loan made by Dovenmuehle, Inc. This loan was made in late 1974, and the default occurred in 1975. As security for the loan, Dovenmuehle had been granted a mortgage on the property from American National at Sus on’s direction. The other case below was originally brought by Dovenmuehle in 1977 to foreclose its mortgage. Waner was a named defendant in this action and filed a counterclaim seeking to foreclose its mechanics’ liens.

Besides failing to pay Dovenmuehle and the subcontractors, Suson also failed to pay the 1975 real estate taxes on the property. As a result, in November 1976, the property was sold at a tax sale pursuant to a court order. The purchasers at this sale were Interstate Bond Company and Thornton, Ltd. The tax sale price was apparently between $100,000 and $150,000. There is no dispute in this case as to the validity of this sale.

While the above events were taking place, Chicago Title and Dovenmuehle were involved in a dispute between themselves. Chicago Title was the insurer of Dovenmuehle’s mortgage interest and had insured the interest against any losses from mechanics’ liens. The dispute involved the extent of Chicago Title’s liability. The relationship between Chicago Title and Dovenmuehle is important to this case, as is the action Chicago Title took to protect Dovenmuehle’s interest in the property. We will set out here in chronological order the events leading up to Chicago Title’s acquisition of the tax deeds on the property and point out Chicago Title’s and Dovenmuehle’s participation in these events.

August 1978

Interstate Bond Company and Thornton, Ltd., assign their certificates of tax purchase acquired from the tax sale to George Mergili and Janice Wajda. (The consideration for this assignment appears to have been approximately $150,000.) Mergili and Wajda ostensibly act as individuals when purchasing the certificates but in fact are employees of Chicago Title acting for Chicago Title.

November 1978

Mergili and Wajda, acting ostensibly as individuals, file petitions in the tax court seeking an order for the issuance of tax deeds on the property under section 266 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 747). Under this section, a purchaser at a tax sale or his assignee may file a petition for tax deeds any time within five months prior to the expiration of the period of redemption. Any party having an interest in property sold at a tax sale has two years after the sale to redeem the property. (See Ill. Rev. Stat. 1979, ch. 120, par. 734.) The initial two-year period is supposed to expire in November 1978, when Mergili and Wajda file their petitions for tax deeds. However, Mergili and Wajda eventually agree to extend the initial two-year period to three years (see Ill. Rev. Stat. 1979, ch. 120, par. 744), and thus the period of redemption will not expire until November 1979.

Many of the mechanics’ lien claimants receive notice of the petitions for tax deeds and some file appearances. Waner receives notice but fails to appear.

February 28,1979

Chicago Title and Dovenmuehle complete their negotiations and enter into a written agreement. Under the agreement, Chicago Title admits its liability to Dovenmuehle for all potential losses to Dovenmuehle’s interest in the property from mechanics’ liens. Chicago Title promises to defend Dovenmuehle’s interest against mechanics’ lien claims and pay for any losses from successful claims. In return, Dovenmuehle promises to absorb one-half of any losses from such claims. However, Dovenmuehle’s loss is limited to $150,000.

Also on February 28, one of the mechanics’ lien claimants who has appeared in the tax deed proceedings files an answer to the petitions for tax deeds. Various reasons for denying the petitions are alleged. One of those reasons is that the mechanics’ lienholder, upon information and belief, asserts that Mergili and Wajda are employees of Chicago Title and Chicago Title is Dovenmuehle’s insurer against mechanics’ lien claims. The lienholder asserts that he believes Dovenmuehle and Chicago Title are involved in a possible scheme that will allow Dovenmuehle to acquire tax deeds to the property, and thus merchantable title to the property free and clear of all liens (see Ill. Rev. Stat. 1979, ch. 120, par. 747), for the minimal cost of outstanding taxes on the property. The lienholder asserts that Mergili and Wajda are acting secretly for Chicago Title and Dovenmuehle in an effort to destroy all outstanding mechanics’ lien claims to the property and thus they are not entitled to tax deeds. Other lienholders who have appeared in the tax deed proceedings file similar answers.

March to July 1979

In discovery, Chicago Title admits that Mergili and Wajda are its employees and that it is the insurer of Dovenmuehle’s mortgage interest. The February 28 agreement entered into between Chicago Title and Dovenmuehle is discovered; nevertheless, Chicago Title does not admit to a “possible scheme” between Dovenmuehle and it, and Mergili and Wajda file motions to strike the answers. Among the reasons asserted for striking the answers is that insufficient facts have been alleged to show that Dovenmuehle and Chicago Title are involved in a possible scheme. The answers are stricken, but the lienholders are given leave to amend their answers to more specifically set out Chicago Title’s and Dovenmuehle’s relationship with each other and how that relationship affects Mergili’s and Wajda’s petitions for tax deeds.

Amended answers are filed. In them, the lienholders again allege the relationship between Chicago Title, Dovenmuehle, and Mergili and Wajda. On information and belief, the lienholders allege that Dovenmuehle has paid Chicago Title the amount necessary to purchase the tax deeds and that Chicago Title intends to transfer the tax deeds to Dovenmuehle after they are issued. The lienholders allege that because of Chicago Title’s relationship with Dovenmuehle, Chicago Title’s employees, Mergili and Wajda, are prohibited from becoming tax deed holders and that the assignment of the certificates of purchase to Mergili and Wajda should be treated as a redemption and thus the petitions for tax deeds should be denied.

Thereafter, the lienholders who have appeared and filed answers fail to pursue their contentions, indicating that a settlement has been reached.

August 15,1979

Chicago Title and Dovenmuehle enter into an amended agreement. Under this agreement, Chicago Title promises to deliver to HoCo of Green Lake, Inc., a wholly owned subsidiary of Dovenmuehle, a quitclaim deed from the owners of the property, Suson and American National. This is to be delivered contemporaneously with the signing of the agreement and is apparently delivered in August 1979. Thus, at this time, Dovenmuehle not only holds a mortgage interest but is also the owner of the property, and thus the original owners of the property, likely parties to redeem from the tax sale, have been eliminated.

Chicago Title also assures Dovenmuehle in the agreement that Dovenmuehle will have merchantable title to the property within six months after the date of the agreement. Additionally, Chicago Title promises to indemnify Dovenmuehle against any losses it may incur to mechanics’ lienholders as a result of Dovenmuehle’s failure to exercise its right of redemption from the tax sale.

In return, Dovenmuehle agrees to pay Chicago Title approximately $160,000 contemporaneously with the signing of the agreement.

This agreement is not revealed to the tax court and is not discovered by any of the lienholders until after the tax deeds are issued.

September 7,1979

A representative of Chase Manhattan Company, which owns Dovenmuehle, sends a letter to a New York bank. The representative explains that Dovenmuehle is presently in the process of attempting to minimize its losses from making the construction loan for the property. He describes that one method being employed is for Dovenmuehle’s title insurance company to acquire tax deeds to the property and transfer them to Dovenmuehle.

This letter is not discovered by any of the lienholders until after the tax deeds are issued.

November 1979

Since it still officially appears to the tax court that Mergili and Wajda are acting as individuals with no interest in the property, the tax court finds that all statutory requirements for the issuance of tax deeds have been complied with and orders the county clerk to issue tax deeds to Mergili and Wajda. Mergili and Wajda receive the tax deeds and transfer them to Chicago Title.

O « ft

After the time for appeal from the court order directing that tax deeds should be issued had expired, Chicago Title filed motions to dismiss all the mechanics’ lien claims in the two cases before us (claims which appear to have totalled several hundred thousand dollars). Chicago Title alleged it had acquired tax deeds to the property which were issued pursuant to a court order under section 266 of the Revenue Act. One part of that section reads, “This Section shall be liberally construed so that tax deeds herein provided for shall convey merchantable title.” (Ill. Rev. Stat. 1979, ch. 120, par. 747.) Chicago Title alleged that the tax deeds, when issued, extinguished all prior mechanics’ liens and created merchantable and unchallengeable title in Chicago Title.

Waner challenged the motion by asserting that Chicago Title, when it acquired the tax deeds, was actually acting for Dovenmuehle. Waner alleged that Dovenmuehle, as a mortgagee with a pretax sale interest in the property, was prohibited by law from purchasing tax deeds to the property and asserting them to the prejudice of other lienholders. Hence, concluded Waner, since Dovenmuehle could not purchase a tax deed and use it against Waner, Chicago Title could not do so on Dovenmuehle’s behalf.

Chicago Title’s reply to this was that Waner was barred from raising the issue in the mechanics’ lien cases. Though three different theories of bar were argued by Chicago Title at the trial level, Chicago Title has argued only two of those theories on appeal, which two theories were as follows.

First, Chicago Title asserted that Waner was barred from raising the issue because of the following language in section 266 of the Revenue Act:

“Tax deeds issued pursuant to this Section are incontestable except by appeal from the order of the court directing the county clerk to issue the tax deed. However, relief from such order may be had under Section 72 of the ‘Civil Practice Act’, [Ill. Rev. Stat. 1979, ch. 110, par. 72] * * * in the same manner, upon the same grounds and to the same extent as may be had under that Section with respect to final orders, and judgments in other proceedings.” Ill. Rev. Stat. 1979, ch. 120, par. 747.

Chicago Title alleged that this language in section 266 prohibited Waner from pursuing a collateral attack on the merchantable title represented by the tax deeds in a proceeding other than the original tax deed proceedings. Chicago Title concluded that Waner’s mechanics’ liens claims had to be dismissed because of section 266 and Waner could not raise any issue in the mechanics’ lien cases that challenged the validity of the tax deeds.

Second, Chicago Title alleged that, since Waner had notice of the tax deed proceedings, it was barred by the doctrine of res judicata from presenting any issue challenging the validity of the tax deeds, which issue it could have presented in the tax deed proceedings. Chicago Title asserted that other lienholders had raised the issue of Chicago Title’s and Dovenmuehle’s relationship and the tax court had conclusively determined Chicago Title was entitled to tax deeds despite the relationship.

The trial court granted Chicago Title’s motion to dismiss, holding that the tax deeds, when^issued, extinguished the mechanics’ liens and Waner was barred from raising any issue concerning whether Chicago Title should have been allowed to purchase the tax deeds. This appeal followed.

Opinion

I

The alleged facts in this case, which must be taken as true for the purpose of the motion to dismiss, lead to obvious inferences. When Chicago Title and its employees took steps to acquire the tax deeds to the property, they were secretly acting for the benefit of Dovenmuehle so that Dovenmuehle could save its mortgage interest from any losses due to mechanics’ liens. Dovenmuehle had a $7,000,000 interest in the property which was threatened by at least several hundred thousand dollars in mechanics’ liens claims. To abate this threat, Dovenmuehle paid Chicago Title approximately $160,000 so Chicago Title could acquire tax title to the property and transfer it to Dovenmuehle. The result is that Dovenmuehle will acquire merchantable title to the property and the mechanics’ lienholders will lose any hope they have for recovering for their materials and services.

The first issue we must address is whether Dovenmuehle, as a mortgagee, could have openly become a tax purchaser, by purchasing at the tax sale or taking the certificates of assignment, and could have openly acquired tax deeds to the property and use those deeds to defeat the claims of the mechanics’ lienholders. If Dovenmuehle could have legally acquired the tax deeds on its own behalf, then it is irrelevant that Dovenmuehle has attempted to acquire the tax deeds secretly through a third party. Also, if Dovenmuehle could have legally acquired the tax deeds, the issues of bar are irrelevant to this decision.

On the other hand, if Dovenmuehle was prohibited by law from openly becoming a tax purchaser or a grantee of the tax deeds, then it could not have done so secretly through a third party (see Stinson v. Connecticut Mutual Life Insurance Co. (1898), 174 Ill. 125, 51 N.E. 193; McChesney v. White (1892), 140 Ill. 330, 29 N.E. 709; Voris v. Thomas (1851), 12 Ill. 442), and only if Dovenmuehle was prohibited from doing so do the issues of bar become relevant to this case.

Many Illinois cases have held that certain parties, because they have an interest in the property created prior to a tax sale, are prohibited from becoming purchasers at a tax sale, assignees of the certificates of purchase, or grantees of the tax deeds, for the purpose of eliminating the interests of other parties in the property. (E.g., Stinson v. Connecticut Mutual Life Insurance Co. (1898), 174 Ill. 125, 51 N.E. 193 (mortgagee prohibited from purchasing at a tax sale to defeat interest of the mortgagor); McAlpine, Polk & Co. v. Zitzer (1887), 119 Ill. 273, 10 N.E. 901 (mortgagor through a third person could not purchase at a tax sale to defeat interest of mortgagee); Brown v. Hogle (1863), 30 Ill. 119 (tenant in common prohibited from purchasing at a tax sale and setting up tax deed to defeat interests of other tenants in common); Devon Bank v. Schlinder (1979), 72 Ill. App. 3d 147, 390 N.E.2d 447 (contract purchaser prohibited from purchasing tax deed and setting it up to defeat interest of vendor).) It has been held that if such a party in interest purchases at a tax sale, takes an assignment of the certificates of purchase, or acquires tax deeds from the county clerk, such will in the law constitute merely a payment of taxes or a redemption and not a purchase, assignment, or unlawful acquisition of the tax deeds. See, e.g., Stinson v. Connecticut Mutual Life Insurance Co. (1898), 174 Ill. 125, 51 N.E. 193; McChesney v. White (1892), 140 Ill. 330, 29 N.E. 709; Lomax v. Gindele (1886), 117 Ill. 527, 7 N.E. 483.

Though Illinois courts have not specifically ruled that a mortgagee, whose interest in property arose before a tax sale, is prohibited from becoming a tax purchaser for the purpose of eliminating other liens on the property, other jurisdictions have specifically ruled that mortgagees are prohibited from doing so. (E.g., Miller v. First National Bank (1968), 164 Colo. 449, 435 P.2d 899; Moore v. Crisp (Okla. 1963), 383 P.2d 221; Koch v. Kiron State Bank (1941), 230 Iowa 206, 297 N.W. 450.) The reasoning underlying these decisions is, we believe, applicable here. The mortgagee has a right to redeem the property from a tax sale. In equity, the mortgagee should not be allowed to waive this right and instead become a tax purchaser, and cause injury to the other lienholders, for the minimal cost it would have taken to redeem the property from the tax sale. The property is a common fund in which all the parties have an interest. One should not be allowed to use the law of tax sales to destroy this fund to benefit oneself to the prejudice of all others. It is manifestly unfair to allow a mortgagee to use the law of tax sales for the specific purpose of working an injustice. (See Lane v. Wright (1903), 121 Iowa 376, 96 N.W. 902.) The law of tax sales is designed to give strangers to the property a speedy method of acquiring merchantable title to the property so the property can get back into the stream of commerce so that future taxes can be collected. (See Cherin v. R. & C. Co. (1957), 11 Ill. 2d 447, 143 N.E.2d 235.) It is not designed to be a method by which a party with a pretax sale interest in the property can forego the payment of the taxes, allow the property to be sold for taxes, and then acquire it for a minimal cost so that party can raise its previous interest above all other previous interests.

The facts in the present case amply demonstrate the fairness of a rule that prohibits the mortgagee from acquiring tax title to the property to raise its interest above all other prior lien interests. Out of all of the parties with an interest in the property, Dovenmuehle had to be considered the most likely party to redeem the property from the tax sale other than the owners (who had been conveniently eliminated before the period of redemption had expired). It had a $7,000,000 interest in the property. Thus, sound business sense dictates that Dovenmuehle would have been willing to spend the $100,000 to $200,000 necessary to redeem the property to save its interest.

On the other hand, parties like Waner with relatively small claims to the property would hardly have been likely to spend more than the value of their claims to effect a redemption. Their claims were doubtful to begin with, since there were so many other claims being asserted against the property. It would have been unsound business practice to have spent, as in Waner’s case, more than seven times the amount of its mechanics’ lien claims to effect a redemption to save those claims. Parties in the position of Waner could have only hoped that a party such as Dovenmuehle would redeem the property. To allow Dovenmuehle to waive its right of redemption and secretly become a tax purchaser would be to allow a gross injustice.

Thus, we hold that Dovenmuehle could not have become a purchaser at the tax sale, an assignee of the purchaser, or a party entitled to be issued tax deeds by the county clerk for the purpose of raising Dovenmuehle’s mortgage interest above all other liens.

We note that Chicago Title, in its answering brief, does not even challenge the view that Dovenmuehle could not have become a tax purchaser openly. Instead, it apparently argues that Mergili and Wajda, when they took the assignments of the certificates of purchase and acquired the tax deeds, were merely acting for Chicago Title and not Dovenmuehle. However, the alleged facts in this case clearly show that Chicago Title intends to transfer the tax deeds to Dovenmuehle. Also, it would appear that this had to be Chicago Title’s intent from the time when Mergili and Wajda purchased the certificates of tax purchase and petitioned for tax deeds. If Chicago Title did not intend from the outset to transfer the tax deeds to Dovenmuehle, then we must assume that Chicago Title originally intended to commit a fraud on its own client, Dovenmuehle, since the tax deeds would act to destroy all prior interests in the property including Dovenmuehle’s. We cannot assume that Chicago Title intended to commit a fraud on its own client.

Thus, we conclude that Chicago Title and its employees, since they were acting for Dovenmuehle, were prohibited from becoming assignees of the tax purchasers and were prohibited from acquiring tax deeds for the purpose of destroying all of the mechanics’ liens on the property.

II

We turn now to the issues concerning bar. It is true that tax deeds, when issued, create in their holder merchantable title free and clear of all prior interests in the property if the deeds are valid. (Ill. Rev. Stat. 1979, ch. 120, par. 747; City of Bloomington v. John Allan Co. (1974), 18 Ill. App. 3d 569, 310 N.E.2d 437.) It also cannot be denied that Waner’s mechanics’ lien claims constitute a collateral attack upon the validity of the order directing that the tax deeds should be issued. In most cases, Waner could not do this because of the incontestability language in section 266 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 747). Nevertheless, it has been held that if the order directing that tax deeds should be issued is void, the tax deeds can be challenged in any proceeding in which the issue of the validity of the deeds is raised. Cherin v. R. & C. Co. (1957), 11 Ill. 2d 447, 143 N.E.2d 235; In re Application of County Collector (1977), 48 Ill. App. 3d 572, 362 N.E.2d 1335; see Ill. Rev. Stat. 1979, ch. 110, par. 72(6).

A void order is one where the court lacked subject matter or personal jurisdiction to enter it or one-where the order is procured by fraud. (Federal Sign & Signal Corp. v. Czubak (1978), 57 Ill. App. 3d 176, 372 N.E.2d 965.) The kind of fraud which renders an order void is that which gives the court merely “colorable jurisdiction” to enter it. (Schwarz v. Schwarz (1963), 27 Ill. 2d 140, 188 N.E.2d 673.) In other words, the fraud must involve false allegations that are determinative of the court’s jurisdiction. We believe the facts alleged in this case present an issue of such fraud.

The concept of subject matter jurisdiction involves various elements. The fact that a court has general jurisdiction to consider the kind of case before it is not the only element of jurisdiction. Jurisdiction over any particular case depends on whether the jurisdiction of the court has been properly invoked. This latter element of jurisdiction frequently leads to controversy when the court’s jurisdiction over a matter is controlled by statute. Though a court be one of general jurisdiction, when its power to act on a particular matter is controlled by statute, the court is governed by the rules of limited jurisdiction. (Brown v. VanKeuren (1930), 340 Ill. 118, 172 N.E. 1.) Thus, before a court can procure jurisdiction to enforce a special statutory right, it is necessary that the petition filed pursuant to that statute contain on its face all of the necessary elements required by the statute. (Scribner v. Village of Downers Grove (1939), 372 Ill. 614, 25 N.E.2d 54; Brown v. VanKeuren (1930), 340 Ill. 118, 172 N.E. 1.) If a party files a petition pursuant to a special statute and misrepresents facts required to be alleged by the statute before the court can proceed to act, then that party commits fraud in the procurement of the court’s jurisdiction.

Tax deed proceedings are special statutory proceedings to enforce a special statutory right. Of peculiar note is that petitions for tax deeds must be filed by the purchasers at the tax sale or the assignees of the purchasers. (Ill. Rev. Stat. 1979, ch. 120, par. 747.) When Mergili and Wajda filed petitions for tax deeds it was necessary for them to assert in the petitions that they were either purchasers at the tax sale or assignees of the purchasers. When a statute specifically identifies persdns who may invoke the jurisdiction of a court in a special statutory proceeding, it is essential to the jurisdiction of the court that only the persons named institute the proceedings. See Sims v. City of Moline (1921), 222 Ill. App. 530; Avery v. County Court (1952), 126 Colo. 421, 250 P.2d 122.

When Mergili and Wajda, acting ostensibly as strangers to the property, filed petitions for tax deeds and asserted they were assignees of the certificates of purchase, they were misrepresenting a jurisdictional fact because they were not legally assignees of the certificates of purchase. As previously noted, since Mergili and Wajda were actually acting for Dovenmuehle when they acquired the certificates of purchase, such acquisition, as a matter of law, constituted a redemption of the property and not an assignment. (See Stinson v. Connecticut Mutual Life Insurance Co. (1898), 174 Ill. 125, 51 N.E. 193; Lomax v. Gindell (1886), 117 Ill. 527, 7 N.E. 483; Ragor v. Lomax (1887), 22 Ill. App. 628.) Since Mergili and Wajda were redeemers and not assignees and since they were actually acting for Dovenmuehle’s benefit so that Dovenmuehle could acquire the tax deeds and use them to destroy the interests of all the mechanics’ lienholders, they were not permitted to file petitions for tax deeds. To have asserted that they were assignees and to have made themselves appear before the court as strangers to the property rather than as representatives of Dovenmuehle was to commit fraud in procuring the court’s jurisdiction, and such fraud renders the order entered based on their petitions void.

Of course, since the order directing that tax deeds should be issued was void based on the alleged facts of this case, the issues concerning bar have no application. (In re Application of County Collector (1977), 48 Ill. App. 3d 572, 362 N.E.2d 1335.) Also, it cannot be argued that the tax deed case presented an area of questionable jurisdiction in which the tax court knew the truth of the matter and ruled it had jurisdiction. It is clear from the tax deed proceedings that the court never actually ruled that Dovenmuehle, and thus Mergili and Wajda, was entitled to file a petition for tax deeds even though Dovenmuehle was a mortgagee. Only some of the facts concerning Dovenmuehle’s relationship with Chicago Title and Mergili and Wajda were revealed to the court and no one pursued the issue. From the face of the record of the tax deed proceedings, it appears that the tax court entered orders directing that tax deeds be issued based on the fraudulent assumption put forth by Mergili and Wajda that they were still strangers to the property with no intent of acquiring the tax deeds for Dovenmuehle’s benefit.

Finally, Chicago Title cannot argue that Waner had a duty to discover the fraud in the tax deed proceedings and present the issue to that court merely because it had notice of the tax deed proceedings. Tax deed proceedings are special summary proceedings to determine whether the petitioner has met the requirements of law which entitle him to tax deeds. Waner was not a party defendant in the traditional sense to those proceedings. The only reason a party such as Waner would have had to file an appearance and an objection to the petitions for tax deeds was if it had believed it had a legitimate reason for preventing the deeds from being issued. From the face of the notice of the proceedings that Waner received, Mergili and Wajda were two strangers to the property entitled to tax deeds. Thus, Waner had no reason to file an appearance and enter an objection because it did not know that Mergili and Wajda were actually acting for Dovenmuehle.

Thus, we hold that, based on the alleged facts in this case, the motion to dismiss Waner’s mechanics’ lien claims was improperly granted. Accordingly, we reverse the order dismissing Waner’s claims and remand for further proceedings.

Reversed and remanded.

JOHNSON, J„ concurs.

Mr. JUSTICE JIGANTI

dissenting:

The plaintiffs in this proceeding to foreclose on mechanics’ liens collaterally attack the judgment order that had been previously issued in a tax sale proceeding. Pursuant to the judgment order in the tax sale proceeding, the county clerk issued a tax deed. This court holds that the court that issued the judgment directing the issuance of the tax deed was without jurisdiction because the court’s jurisdiction was procured through fraud.

Smith v. D.R.G., Inc. (1976), 63 Ill. 2d 31, 344 N.E.2d 468 stated explicitly that a tax sale proceeding is in rem and not in personam and that the court acquires jurisdiction over the land when the county collector makes his application for judgment and order for sale. The court in the tax sale proceeding obtained jurisdiction in that manner and consequently any alleged fraud would not deprive it of jurisdiction. The remedy for the plaintiffs in this mechanics’ lien foreclosure action was by way of direct appeal in the tax sale proceedings or through the use of section 72 of the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 72.) It is not appropriate to attack the judgment in a collateral proceeding. I would affirm the judgment.


author: Mr. PRESIDING JUSTICE RIZZI

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. ROSEMARY GRANT et al., Defendants-Appellants.
    First District (3rd Division)
    Nos. 80-146, 80-147, 80-148 cons.
    Opinion filed October 7, 1981.

      James J. Doherty, Public Defender, of Chicago (John E. Horn, Assistant Public Defender, of counsel), for appellants.
    Bernard Carey, State’s Attorney, of Chicago (Marcia B. Orr, Kathleen Warnick, and Kevin W. Horan, Assistant State’s Attorneys, of counsel), for the People.
   Mr. PRESIDING JUSTICE RIZZI

delivered the opinion of the court:

In a jury trial, defendants Rosemary Grant, Carl Grant and Jadine Grant were found guilty of mob action. (Ill. Rev. Stat. 1979, ch. 38, par. 25 — 1(d).) In addition, Carl Grant was found guilty of criminal trespass to land (Ill. Rev. Stat. 1979, ch. 38, par. 21 — 3(a)), and Jadine Grant was found guilty of assault (Ill. Rev. Stat. 1979, ch. 38, par. 12 — 1). Rosemary Grant and Carl Grant were sentenced to one year probation. Jadine Grant was sentenced to six months probation and was fined $250. We reverse as to Rosemary Grant and reverse and remand as to Carl Grant and Jadine Grant.

Ear line Weatherspoon testified that on August 23, 1979, at approximately 5 p.m., Carl and Rosemary Grant were on the steps outside of her grocery store in Dixmoor, Rlinois. Carl Grant had a hammer in hand. He asked Mrs. Weatherspoon to step outside. When she ignored him, Carl Grant opened the door and again asked her to step outside. Mrs. Weatherspoon told Carl Grant to leave her property, and she called the police. She had asked Carl Grant to leave her property several times in the past. Rosemary Grant testified that she was not on the steps of the store that afternoon.

At approximately 8 p.m. on the same day, Mrs. Weatherspoon and her two sons were leaving the store and saw several members of the Grant family standing outside the store. There were also some policemen outside the store. As Mrs. Weatherspoon’s son, Jerome, was attempting to close the burglar gates, Carl Grant was standing to the left of the door with a hammer raised above his shoulders. According to one of the officers, Carl Grant was about a foot and a half or two feet from Jerome Weatherspoon. Another officer testified that Carl Grant and the “boy that was closing the door [were] standing face to face.” At this point, one of the officers stepped between the two youths.

Mrs. Weatherspoon and her other son walked towards the parking lot to get her car. As Mrs. Weatherspoon was walking to her car, Jadine Grant approached her with a stick in her hand, uttered profanities, and said she was going to “bust [Mrs. Weatherspoon’s] brains out” because Mrs. Weatherspoon had hit her grandson. Jadine Grant testified that she did not have a conversation with Mrs. Weatherspoon and denied that she attempted to hit her with a stick.

While Mrs. Weatherspoon continued to walk to her car, she was hit in the back by a glass jar. According to Mrs. Weatherspoon, Rosemary Grant, who had been cursing and calling her names, said that she threw the jar and wished that she had killed her. One of the officers testified that Rosemary Grant threw the jar at Mrs. Weatherspoon. Rosemary Grant testified that she was drinking Kool-Aid from a glass jar, but she never threw the jar at Mrs. Weatherspoon.

Defendants contend that the complaints charging mob action were defective because they failed to allege that defendants acted with any mental state. As to the mob action charges, defendants attacked the sufficiency of the complaints by filing a motion in arrest of judgment. Defense counsel stated that the motion in arrest of judgment was directed at the mob action complaints only, and that it was not addressed to the assault and the criminal trespass to land complaints. When the sufficiency of a complaint is attacked by a motion in arrest of judgment (Ill. Rev. Stat. 1979, ch. 38, par. 116 — 2), the standard of review is whether the complaint complies with the requirements of section 111 — 3 of the Code of Criminal Procedure of 1963 (Ill. Rev. Stat. 1979, ch. 38, par. 111 — 3). (People v. Tuczynski (1978), 62 Ill. App. 3d 644, 648, 378 N.E.2d 1200, 1203; People v. Haltom (1976), 37 Ill. App. 3d 1059,1063, 347 N.E.2d 502, 505.) One of the requirements of section 111 — 3 is that the charge set forth the nature and elements of the offense charged. Ill. Rev. Stat. 1979, ch. 38, par. 111-3 (a)(3).

Defendants argue that the mob action complaints did not set forth the nature and elements of the offense since they did not include one of the mental states incorporated by section 4 — 3(a) of the Criminal Code of 1961 (Ill. Rev. Stat. 1979, ch. 38, par. 4-3(a)). The same contention was raised in People v. Leach (1972), 3 Ill. App. 3d 389, 279 N.E.2d 450. In Leach, which also dealt with a mob action complaint, the court stated:

“A cursory examination of this complaint discloses that it does not allege a mental state; that is, defendant is not charged with having acted with intent, knowledge, recklessness or negligence. The mob action statute does not in express terms require a mental state. (See Ill. Rev. Stat. 1969, ch. 38, par. 25 — 1.) Our law, however, provides that a person is not guilty of an offense, other than an offense which involves absolute liability, unless, with respect to each element described by the statute defining the offense, he acts while having one of the mental states described in our criminal code; that is, intent, knowledge, recklessness or negligence. (See Ill. Rev. Stat. 1969, ch. 38, pars. 4 — 3, 4 — 4, 4 — 5, 4 — 6, 4 — 7.) 000 The mob action statute contains no indication, clear or otherwise, of a legislative purpose to make it an absolute liability crime. From this it follows that “[a] person cannot be guilty of the conduct proscribed by the Mob Action statute unless he intentionally, knowingly, or recklessly engages in such conduct.” “ * * Therefore, one of the mental states defined in our criminal code: intent, knowledge, recklessness or negligence is an essential element of mob action, the crime with which defendant was charged. * ° *.
It is a general rule of criminal pleading that a complaint, information or indictment which does not set forth the nature and elements of the crime sought to be charged fails to state an offense and is subject to dismissal. * * * By these authorities, then, a complaint, like the one before us, which does not set forth all of the essential elements of the crime charged, fails to state an offense. It is fatally defective and cannot support a conviction. * * * Where a conviction rests on such a complaint, we will reverse without remand.” (3 Ill. App. 3d 389, 392-93, 279 N.E.2d 450, 452.)

More recently, in People v. Valley Steel Products Co. (1978), 71 Ill. 2d 408, 425, 375 N.E.2d 1297, 1305, the court held that indictments under the Motor Fuel Tax Law were defective in that they failed to incorporate a mental state requirement as prescribed by section 4 — 3(a) of the Criminal Code of 1961.

Accordingly, we conclude that allegations of a mental state were required here. Since the complaints charging mob action do not allege a mental state, they do not set forth all of the essential elements of the crime charged. In that regard, they are fatally defective and cannot support convictions for mob action. Therefore, the mob action convictions are reversed without remand. See Leach, 3 Ill. App. 3d 389, 393, 279 N.E.2d 450, 452; People v. Malone, (1979), 71 Ill. App. 3d 231, 233-34, 389 N.E.2d 908, 910; Cf. Valley Steel Products, 71 Ill. 2d 408, 425, 375 N.E.2d 1297, 1305.

Defendants next contend that their convictions for assault and criminal trespass to land must also be reversed without remand because the complaints also failed to allege that defendants acted with any mental state as to those crimes. However, as to the assáult and criminal trespass to land charges, this contention was raised for the.first .time on appeal. When a complaint is attacked for the first time on appeal, the conviction will be upheld provided that the complaint (1) apprised the accused of the precise offense charged with sufficient specificity to prepare his defense and (2) it allows pleading a resulting conviction as a bar to future prosecution arising out of the same conduct. (People v. Gilmore (1976), 63 Ill. 2d 23, 29, 344 N.E.2d 456, 460; People v. Pujoue (1975), 61 Ill. 2d 335, 339, 335 N.E.2d 437, 440.) We conclude that the complaints for assault and criminal trespass to land meet these criteria. Therefore, we reject defendants’ contention that their convictions for assault and criminal trespass to land must be reversed because the complaints are fatally defective.

Defendants next contend that the instructions relating to assault and criminal trespass to land were improper and prejudicial because they did not include one of the mental states included in section 4 — 3(a). The State argues that defendants waived this issue by submitting the instructions, which were taken from IPI Criminal (IPI Criminal Nos. 11.01, 11.02, 16.05,16.07 (1968)).

Generally, a party who desires a specific instruction must offer it and request the court to give it, and the trial court has no obligation to instruct on its own motion. In criminal cases, however, this rule is modified in certain situations by the requirements of a fair trial. It has been held that a court bears the burden of seeing that the jury is instructed on the elements of the crime charged, on the presumption of innocence and on the question of burden of proof. (People v. Parks (1976), 65 Ill. 2d 132, 137, 357 N.E.2d 487, 489; see also People v. Carey (1981), 94 Ill. App. 3d 631, 633-34, 418 N.E.2d 1119, 1121; People v. Washington (1978), 60 Ill. App. 3d 662, 665, 377 N.E.2d 397, 399; People v. Tamayo (1978), 56 Ill. App. 3d 800, 805, 372 N.E.2d 434, 438, modified on other grounds (1978), 73 Ill. 2d 304, 383 N.E.2d 227.) Also, where there are such grave errors in proffered jury instructions so as to affect plain justice, it is the duty of the court to inform the jury as to the law. (People v. Pernell (1979), 72 Ill. App. 3d 664, 667, 391 N.E.2d 85, 87; see Ill. Rev. Stat. 1979, ch. 110A, par. 451(c).) In the present case, since the alleged error in the instructions concerns the absence of one of the essential elements of the crimes charged and since it would affect plain justice, we address this issue. But see People v. Anderson (1981), 93 Ill. App. 3d 646, 655, 417 N.E.2d 663, 670.

The statutes defining assault and criminal trespass to land do not expressly include a mental state. (Ill. Rev. Stat. 1979, ch. 38, pars. 12 — 1, 21 — 3(a).) However, section 4 — 3(a) provides that a person is not guilty of an offense, other than an offense which involves absolute liability, unless he acts while having one of the mental states described in sections 4 — 4 to 4 — 7. Since neither assault nor criminal trespass to land is a crime of absolute liability, section 4 — 3(a) incorporates a mental state requirement in the definition of each of these offenses. (Cf. People v. Valley Steel Products Co. (1978), 71 Ill. 2d 408, 425, 375 N.E.2d 1297, 1305; People v. Malone (1979), 71 Ill. App. 3d 231, 233-34, 389 N.E.2d 908, 910; People v. Leach (1972), 3 Ill. App. 3d 389, 392-93, 279 N.E.2d 450, 452.) Therefore, the instructions on assault and criminal trespass to land lacked an essential element of the crimes charged. Defendants’ convictions on these charges must therefore be reversed, and defendants must be granted a new. trial. See People v. Nunn (1978), 65 Ill. App. 3d 981, 985-86, 382 N.E.2d 1305, 1309, affirmed (1979), 77 Ill. 2d 243, 396 N.E.2d 27; People v. Hutchison (1977), 46 Ill. App. 3d 725, 726, 361 N.E.2d 328, 329; People v. Lewis (1969), 112 Ill. App. 2d 1, 11, 250 N.E.2d 812, 817.

Pursuant to People v. Taylor (1979), 76 Ill. 2d 289, 309, 391 N.E.2d 366, 375, we next address defendant Carl Grant’s argument that he was not proved guilty beyond a reasonable doubt of criminal trespass to land. He contends that there was only circumstantial evidence to show that he was on Mrs. Weatherspoon’s property at 8 p.m., the time specified in the State’s bill of particulars. Carl Grant relies upon a photograph of the grocery store. He maintains that it indicates he could have been on the public sidewalk rather than on the steps of the Weatherspoon property.

We conclude that there was sufficient evidence to support the jury’s determination that Carl Grant was guilty of criminal trespass to land. The photograph of the store indicates that the door to the store is set back several feet from the sidewalk, and there is a cement step extending from the door to the sidewalk. It appears that the burglar gates are located at the border between the steps and the sidewalk. One of the police officers at the scene of the incident testified that Carl Grant and the “boy that was closing the door [were] standing face to face.” From the photograph, it appears that one would have to stand on the step in order to close the door. Therefore, the jury could have concluded that Carl Grant and Jerome Weatherspoon were' “face to face” on the step which was part of the Weatherspoon’s property. We believe that the jury could have properly concluded that Carl Grant was guilty of criminal trespass to land beyond a reasonable doubt.

Accordingly, defendants’ convictions for mob action are reversed without remand. The convictions for assault and criminal trespass to land are reversed, and the case is remanded for a new trial on these charges.

Reversed and remanded.

McNAMARA and McGILLICUDDY, JJ., concur.

       The mental states described in sections 4 — 4 to 4 — 7 are: 4 — 4 (intent); 4 — 5 (knowledge); 4' — 6 (recklessness); 4 — 7 (negligence). Ill. Rev. Stat. 1979, ch. 38, pars. 4 — 4, 4 — 5, 4 — 6,4—7. ■

       See Ill. Rev. Stat. 1979, ch. 38, par. 4 — 9: “Absolute Liability. A person may be guilty of an offense without having, as to each element thereof, one of the mental states described in Sections 4 — 4 through 4 — 7 if the offense is a misdemeanor which is not punishable by incarceration or by a fine exceeding $500, or the statute defining the offense clearly indicates a legislative purpose to impose absolute liability for the conduct described.”


author: Mr. JUSTICE McNAMARA

text:
    KNIGHTSBRIDGE REALTY PARTNERS, LTD-75, Plaintiff-Appellant, v. JOSEPH A. PACE, Defendant-Appellee.
    First District (3rd Division)
    No. 80-1799
    Opinion filed October 7, 1981.

      Bishop & Crawford, Ltd., of Oak Brook (Carl A. Neumann, John N. Dore, and Donald B. Garvey, of counsel), for appellant.
    Lonny Ben Ogus, of Chicago, for appellee.
   Mr. JUSTICE McNAMARA

delivered the opinion of the court:

Plaintiff, Knightsbridge Realty Partners, Ltd., appeals from the denial of its post-trial motion requesting the trial court to vacate its order dismissing plaintiff’s complaint with prejudice and seeking leave to amend the complaint. By its complaint against defendant, Joseph A. Pace, plaintiff had sought damages for breach of a personal guaranty contract and for fraudulent misrepresentation.

Defendant is President of Elmore Medical Building, Ltd. After negotiating a sale and leaseback of real estate owned by Elmore, defendant executed a purchase agreement. He signed the document as follows:

“By /s/ Joseph A. Pace Joseph A. Pace President.”

By the terms of the purchase agreement, a lease for the premises was to be executed by the plaintiff buyer at the closing. The terms of the lease were fully set forth and attached to the agreement and incorporated therein by reference. The agreement also provided that the “lease obligation shall be personally guaranteed by Joseph A. Pace, who shall execute at the Closing a Guaranty in the form attached hereto as Exhibit “C” and incorporated by reference herein.”

At the closing, plaintiff executed a lease and paid the purchase price, but defendant did not execute the formal guaranty. After Elmore defaulted on the lease payments, defendant rejected plaintiff’s demand for payment.

Plaintiff filed a complaint in three counts seeking damages for breach of a personal guaranty contract and for fraudulent misrepresentation. In orders dated January 31 and February 7,1980, the trial court dismissed all three counts with prejudice for failure to state a cause of action. On May 6, 1980, the trial court denied plaintiff’s post-trial motion requesting that the dismissal orders be vacated and seeking leave to amend the complaint.

Plaintiff thereafter filed a notice of appeal from the order of May 6, 1980. Subsequently, it obtained leave of this court to file an amended notice of appeal, which stated that the appeal was from all the orders dated January 31, February 7, and May 6, 1980.

We initially address defendant’s contention that there are no reversible issues before this court. Defendant first maintains that our jurisdiction is limited to the issues raised in the order of May 6,1980, since the original notice of appeal alluded only to that order. The amended notice of appeal, he contends, filed approximately 6 months after the May 6 ruling, was untimely.

The notice of appeal must be filed within 30 days of the trial court’s disposition of a timely post-trial motion directed at the judgment. (Ill. Rev. Stat. 1979, ch. 110A, par. 303.) Thereafter, the notice may be amended on motion in the reviewing court and, provided that the amendment does not specify a judgment not named in the original notice, the amendment relates back to the time of filing of the original notice. Ill. Rev. Stat. 1979, ch. 110A, par. 303(c)(4).

The original notice of appeal here states that the appeal is from the May 6, 1980, order denying the motion to vacate the earlier dismissal orders and denying leave to amend. The amended notice states that the appeal is from all three orders. Since the dismissal orders of January 31 and February 7 involve the legal issue whether the complaint on its face states a cause of action, a review of the refusal to vacate such dismissals requires an examination of the complaint for its legal sufficiency. (See People ex rel. Endicott v. Huddleston (1975), 34 Ill. App. 3d 799, 340 N.E.2d 662.) Hence, whether we proceed under the authority of either the original or the amended notice of appeal, our inquiry on review would be the same. We therefore decline to decide whether the amended notice was effective.

Defendant also maintains that since plaintiff’s original brief in this court discusses only whether the complaint is legally sufficient and does not address whether the trial court abused its discretion in refusing to vacate its orders of dismissal, plaintiff has waived any error in the trial court’s refusal to vacate. Yet, there is really one issue: does plaintiff’s complaint state a cause of action? Accordingly, the briefs fully set forth the pertinent argument on this matter. Moreover, we gave leave to plaintiff to file an amended brief in which plaintiff pointed out that the abuse of discretion issue is the same as the sufficiency of the complaint issue for the purpose of the present case.

Defendant also contends that plaintiff’s request for leave to amend its complaint in the post-trial motion constituted an abandonment of any claim of error regarding the dismissed complaint thereby precluding this court from reviewing that dismissal. Where a pleading has been stricken and another, pleading filed in its stead, the earlier pleading is abandoned and any claim of error on the original pleading is waived. (Villareal v. Trevino (1961), 30 Ill. App. 2d 77, 173 N.E.2d 582.) But where, as here, the original pleading was stricken with .prejudice, and the movant also requested in its motion that the trial court vacate its dismissal order as to the first complaint, we do not believe that an abandonment has occurred. (Cf. Field Surgical Associates, Ltd. v. Shadab (1978), 59 Ill. App. 3d 991, 376 N.E.2d 660.) We therefore turn to plaintiff’s argument that the trial court erred in dismissing its complaint.

In count I, plaintiff seeks damages for breach of a personal guaranty contract. Such a contract is subject to the usual standards governing contracts in general. (Blackhawk Hotel Associates v. Kaufman (1981), 85 Ill. 2d 59, 421 N.E.2d 166.) Defendant maintains that the purchase agreement is not a binding contract to personally guarantee payment since, by its terms, it contemplated the later execution of a formal guaranty contract at the closing. Whether a written agreement which includes essential contract terms but which contemplates the execution of a formal contract is a mere negotiation or is itself a binding contract depends upon the intent of the parties. (Interway, Inc. v. Alagna (1980), 85 Ill. App. 3d 1094, 407 N.E.2d 615.) If by the terms of the agreement it is clear that the parties intended to make the later execution of the contract a condition precedent to the formation of a binding contract, then the prior writing is not a contract. Terracom Development Group, Inc. v. Coleman Cable & Wire Co. (1977), 50 Ill. App. 3d 739, 365 N.E.2d 1028.

In the present case, we believe that the intent of the parties as to the effect of the later writing requirement is not clear from the terms of the purchase agreement. The writing states only that defendant “shall execute” the personal guaranty at the closing according to terms identical to an attached copy of the written guarantee. The present agreement is wholly unlike that in Interway, Inc., which expressly provided that the contract obligations at issue were “subject to” the execution of the formal document. Similarly, the intent that a formal contract was a condition precedent to the formation of a binding agreement was clear in Terracom Development Group, Inc. There, the letter of intent expressly stated that the agreement would not be binding until the later execution of a contract satisfactory to the parties.

We believe the present case, therefore, is governed by the rule enunciated in Huegel v. Sassaman (1979), 75 Ill. App. 3d 414, 393 N.E.2d 1361. While parol evidence may not be admissible to show whether the parties intended that an act be a condition precedent to the performance of an obligation, it is admissible to show that they intended a condition precedent to the formation of a contract. (See also Haas v. Cohen (1973), 10 Ill. App. 3d 896, 295 N.E.2d 28.) Indeed, Professor Corbin states that parol evidence such as the parties’ subsequent conduct and statements, and usage and custom “may be decisive of the question whether a contract has been made even though a document was contemplated and has never been executed.” (Corbin, Contracts §30, at 105, 109 (1963).) Accordingly, we cannot rule, on the face of these pleadings, that there is no set of facts provable by plaintiff that could show that a contract to guarantee arose between the parties despite the absence of the later execution of the formal contract.

Defendant next maintains that, as a matter of law, the purchase agreement is not binding against him personally because he signed in his capacity as agent for Elmore. The agent of a disclosed principal is not personally bound by the terms of the contract which he executes in behalf of his principal unless he agrees to be personally liable. (Western Casualty & Surety Co. v. Bauman Insurance Agency (1980), 81 Ill. App. 3d 485, 401 N.E.2d 614.) The intent to be personally bound may be express or may be inferred from all the facts. (Western Casualty & Surety Co. v. Bauman Insurance Agency.) When the agent signs the document and indicates next to his signature his corporate affiliation, then absent evidence of contrary intent in the document, the agent is not personally bound. (Dunlop v. McAtee (1975), 31 Ill. App. 3d 56, 333 N.E.2d 76.) But where language in the body of the document conflicts with the apparent representation by the agent’s signature, an issue of fact as to the agent’s intent arises which is sufficient to withstand a motion to dismiss. See Central States Health and Welfare Fund v. Pitman (1978), 66 Ill. App. 3d 300, 383 N.E.2d 793.

In the present case, such a conflict exists. Defendant signed his name followed by the word President, evincing an intent to sign only in a representative capacity. In the body of purchase agreement, however, it is stated that the defendant shall execute a personal guaranty at closing. Under these circumstances, we cannot say that there is no set of facts under which plaintiff could show that defendant intended to bind himself when he signed the purchase agreement. See Central States Health & Welfare Fund v. Pitman.

Cases relied upon by defendant are distinguishable from the present case. In both Kankakee Concrete Products Corp. v. Mans (1980), 81 Ill. App. 3d 53, 400 N.E.2d 637, and Donaghey v. Executive Funding Corp. (1977), 45 Ill. App. 3d 951, 360 N.E.2d 472, a statute governing negotiable instruments precisely dictated the holding that an agent signing as president did not bind himself personally. We conclude here that the trial court erred in dismissing count I of plaintiff’s complaint.

In count III, plaintiff seeks damages for fraudulent misrepresentation. To state such an action there must be alleged: a false statement of a material fact, made by one with knowledge of its falsity to induce another to act, upon which another reasonably relies without knowledge of its falsity and thereby suffers damage. (Zaborowski v. Hoffman Rosner Corp. (1976), 43 Ill. App. 3d 21, 356 N.E.2d 653.) For purposes of count III, we will assume that the parties did not intend to form a contract for the guarantee until the closing, for if defendant was contractually bound upon the signing of the purchase agreement, the later failure to execute the guarantee at the closing was not material and the action for fraud would clearly fail.

Generally, the misrepresentation must be a past or present fact; there can be no recovery for a false representation of intention or future conduct. (Steinberg v. Chicago Medical School (1977), 69 Ill. 2d 320, 371 N.E.2d 634; Willis v. Atkins (1952), 412 Ill. 245, 106 N.E.2d 370.) Hence, a mere promise made with intent not to fulfill the promise is not actionable fraud. (Willis v. Atkins.) An exception to the general no recovery rule exists, however, where the fraudulent conduct is alleged to be the scheme used to accomplish the fraud. (Steinberg v. Chicago Medical School.) We need not address the applicability of the scheme to accomplish the fraud exception here, however, because we believe that plaintiff’s complaint for false representation must fail. Plaintiff alleges that the false representation was the promise by defendant to deliver the guaranty contract at the closing. It is also alleged that defendant appeared at the closing, but did not deliver the contract, thus not fulfilling his promise. Yet, it is alleged that in reliance on defendant’s promise, plaintiff paid the purchase price at the closing. Where, as here, the falsity of the representation is known to plaintiff, it is not reasonable to persist in relying upon the representation. As a matter of law, plaintiff could not have been induced by defendant’s representations to pay the purchase price at the closing when at the same time defendant did not deliver the guaranty. (Illinois Rockford Corp. v. Kulp (1967), 88 Ill. App. 2d 458, 232 N.E.2d 190.) Accordingly, count III was properly dismissed for failure to state a cause of action.

The trial court also properly dismissed count II. It is in every significant respect identical to count I which also seeks damages for breach of contract. The only distinguishing allegation in count II is that the terms of the guaranty were incorporated by reference within the purchase agreement. Nevertheless, language to the same effect is in the purchase agreement itself which was attached as an exhibit to the complaint. The exhibit is part of the pleadings (Ill. Rev. Stat. 1979, ch. 110, par. 36), and is therefore already included in count I. Count II is repetitious and unnecessary, and the court properly dismissed it.

For the foregoing reasons, the order of the circuit court of Cook County refusing to vacate its order dismissing counts II and III of plaintiff’s complaint is affirmed. The. order refusing to vacate the dismissal of count I is reversed and the cause is remanded for further proceedings.

Affirmed in part; reversed and remanded in part.

McGILLICUDDY and WHITE, JJ., concur.