author: JUSTICE HARTMAN

text:
    LADISLAUS J. BOLCHAZY et al., d/b/a/ U.S. Graphics, Plaintiffs-Appellants, v. CHICAGO INVESTMENT GROUP et al., Defendants-Appellees.
    First District (2nd Division)
    Nos. 82—570, 82—618 cons.
    Opinion filed September 21, 1982.
    Rehearing denied October 19, 1982.

      Irving Lewis, of Chicago, for appellants.
    Sidney Margolis, of Winston & Strawn, of Chicago, for appellees Chicago Investment Group, Alfred Simpson, and Chicago Investment Corporation.
    Donna J. Cunningham and E. T. Cunningham, both of Chicago, for appellee A-Z Letter Service, Inc.
   JUSTICE HARTMAN

delivered the opinion of the court:

Plaintiffs Ladislaus & Marie Bolchazy d/b/a/ U.S. Graphics appeal from an order of the trial court denying their motion for a preliminary injunction in No. 82 — 570 and from the order dismissing their cause of action for permanent injunctive relief in count I of their two count complaint in No. 82 — 618. The action arose out of an alleged breach of a lease purportedly granting them the exclusive right to commercial printing in the office building containing the leased premises. The principal issues raised by plaintiffs on appeal are whether the trial court abused its discretion in denying their motion for a temporary injunction and whether the court erred in dismissing their suit for injunctive relief.

For the reasons which follow, we affirm.

In November 1978, the Bolchazys purchased Unigraphics, Inc. (Unigraphics), a commercial print shop located in a building known as the Willoughby Towers on South Michigan Avenue from Soterios Gardiakos. The previous term leases held by Gardiakos who then owned Unigraphics was for space on the third floor of the building. The leases provided them with the “exclusive rights of print shop” in the building. According to Gardiakos the building manager eventually refused to give Unigraphics a long term lease because most of the third floor was empty and the management was looking for one or two tenants to occupy the entire floor. In the fall of 1977, Unigraphics through Gardiakos entered into an oral month-to-month lease without the exclusive rights understanding. Gardiakos was told that once the entire floor was leased, Unigraphics could move to another room at which time they would be granted an exclusive rights clause. '

Both Ladislaus Bolchazy and Gardiakos stated that when they first started negotiating the sale of Unigraphics in August of 1978, Bolchazy strongly desired an assurance from Timothy Malloy, the property manager for the building, that he could obtain an exclusive rights clause in his lease. Bolchazy and Gardiakos further testified that Malloy told them that it would be no problem to accommodate the Bolchazys’ desire for an exclusive rights clause once the entire third floor was leased and they were moved into another room. Bolchazy stated that he relied on this assurance when he bought the business from Gardiakos and moved into suite 301 as a month-to-month tenant without an exclusive rights clause.

A five-year lease dated March 23, 1979, for suite 503 was entered into between the subsequent lessor of Willoughby Towers, Teachers Insurance & Annuity Association of America (Teachers Insurance) and the Bolchazys. Bolchazy stated that when he received the form lease, he asked Malloy about the exclusive rights clause in Malloy’s office and with Malloy’s secretary apparently present. Malloy allegedly said that would be no problem, and dictated the words to the clause which Bolchazy wrote in. Both paragraphs 4 and 5 of the ninth page of the document were written by hand. The central issues in the case focus upon paragraph 5, which specified that plaintiffs “shall enjoy exclusive right to commercial printing in the building.” This clause was in every executed copy of the lease introduced into evidence, in-eluding that which was filed in the executive office of the lessor’s managing agent. Bolchazy took the lease home, where he and his wife signed it.

Malloy’s testimony contradicted that given by plaintiffs’ witnesses. He did not agree to the exclusive rights clause. He would not have submitted to the lessor a handwritten document like the one in question since everything was always typed. He did not dictate paragraph 5 to Bolchazy. He would not have used the language of paragraph 5 if he were to have dictated such a clause. He did not have the authority to grant a clause of this nature. During the time he had been in the realty business, he never negotiated any exclusive right clauses. His employer’s policy was not to negotiate such clauses. If such a clause were to have been added, it would have been placed on page 8, the rider to the lease, rather than page 9 of the lease, which was the work order Exhibit B. If such a clause would have been agreed to, it would have been mentioned as a special matter in his letter of transmittal of the lease to his employer. The transmittal letter, received in evidence, contained no such mention.

The plaintiffs both testified that they signed their lease for suite 503 after Ladislaus Bolchazy added the exclusive rights clause with the alleged consent of Malloy. On May 29, 1979, Malloy sent plaintiffs’ lease to New York for execution by Teachers Insurance, and on September 25,1979, he sent plaintiffs a fully executed copy of their lease.

In December 1980, Teachers Insurance sold its title and interest in the building to the Chicago Investment Group (Investment Group) to which it assigned plaintiffs’ lease. The new managing agent for the building, Chicago Investment Corporation (Investment Corporation) entered into a lease on March 4 or 5, 1981, with A-Z Letter Service, Inc. (A-Z), which apparently was in the business of commercial printing.

Plaintiffs filed a two-count complaint against the Investment Group, Alfred Simpson, Investment Corporation and A-Z seeking, inter alia, in count I to restrain and enjoin defendants from leasing any portion of Willoughby Towers to any person, including A-Z, other than themselves for the purpose of engaging in commercial printing while plaintiffs’ lease remained in effect. Count II of the complaint was an action at law seeking an award of compensatory and punitive damages. In a written order following a bench trial, the circuit court denied plaintiffs’ motion for a preliminary injunction, dismissed count I “without prejudice” to plaintiffs’ action at law for damages in count II and transferred the case for reassignment to the law division.

Plaintiffs maintain that: their lease provides them with the exclusive right to commercial printing in Willoughby Towers; their right to exclusive printing may be enforced by injunction; their right to enjoin a breach of this clause does not depend on whether or not they will be damaged by the breach; their right to exclusive printing may be enforced against a subsequent lessee, such as A-Z, which had knowledge of the restrictive clause prior to occupying the premises; they have no adequate remedy at law; and they were not guilty of laches.

The threshold and decisive issue in this controversy is whether the handwritten clause specifying that plaintiffs “shall enjoy exclusive right to commercial printing” in Willoughby Towers was so clearly intended by the parties to be part of the lease agreement as to support the injunctive relief sought. The circuit court made no express finding of fact on this issue; however, implicit in its written finding that plaintiffs failed to establish their entitlement to injunctive relief based on the presence of the exclusive right clause is the court’s determination that such an intention was not sufficiently established.

Plaintiffs argue that if the court had found that the exclusive rights clause was not present in the lease, then it would not have transferred the case to the law division for a trial on count II for the breach of a nonexistent provision. The mere transfer, however, of the controversy to the law division without prejudice does not mean that the court found the clause to be part of the agreement in light of its written findings and order dismissing plaintiffs’ cause of action for equitable relief.

Although some of the key facts leading up to the execution of the lease in question were disputed, it may be concluded as a matter of law from the uncontested portions of the record that the lease was executed by both parties subsequent to the insertion of the exclusive rights clause. Less certain, however, is whether Teachers Insurance consented to or was aware of this clause at the time it executed the lease. The official who executed the lease on behalf of Teachers Insurance did not testify. The clause, handwritten by Ladislaus Bolchazy on the ninth and last page of the lease, was neither initialed nor signed by either of the parties. The eighth page of the lease, a typewritten rider expressly made part of the lease and signed by both parties, specified that: “Landlord and Tenant hereby approve plans for certain improvements to the Premises attached hereto as Exhibit ‘B’ (‘The Work’).” Exhibit B constituted the ninth page of the lease, and provided that the landlord shall:

“1. Furnish and install window air conditioning units;
2. Furnish and install levelor blinds for windows;
3. Furnish and install radiator covers.
4. Furnish and install sink and clear door glass.
5. The tenant shall enjoy exclusive right to commercial printing in the building.”

All the items on Exhibit B thus were work orders, except Bolchazy’s handwritten insertion numbered paragraph 5 — the disputed exclusive rights clause. The only reference in the entire lease to page 9 was as a work order sheet.

From the foregoing circumstances, the circuit court could well have found implausible that a provision which so vitally affected the substantive legal rights of both parties would be located on a work order sheet if it were indeed a part of the agreement. There was ample room for such a provision on page 8, the rider which dealt with landlord-tenant obligations, and terms and conditions of occupancy under the lease, a page which was signed by both parties. The court could have determined that Malloy’s testimony was more credible than Bolchazy’s (Schulenburg v. Signatrol, Inc. (1967), 37 Ill. 2d 352, 356, 226 N.E.2d 624) and concluded that the latter simply inserted this provision into the lease without prior knowledge, agreement or approval by the lessor. In view of its form and peculiar location in this document, the absence of any accompanying initials or signature, Malloy’s testimony that he did not consent to this clause, and his assertion that he lacked authority to negotiate such a clause, the court could have properly found that whether this clause was intended to be part of the lease was entirely questionable. Allen v. Amber Manor Apartments Partnership (1981), 95 Ill. App. 3d 541, 549, 420 N.E.2d 440.

A party must clearly show that he is the lawful possessor of those rights for which he seeks the aid of a court of equity in protecting or preserving such rights. (Wilson-Broadway Building Corp. v. Northwestern Elevated R.R. Co. (1922), 225 Ill. App. 306, 313.) A preliminary injunction is an extraordinary remedy which may be granted only upon the sound exercise of judicial discretion after a showing of urgency and necessity (Bohomolec v. Gieblewicz (1971), 3 Ill. App. 3d 16, 18, 278 N.E.2d 202), and is properly denied, in a case such as this, where the plaintiff’s right is not free from doubt. (Hydroaire, Inc. v. Sager (1981), 98 Ill. App. 3d 758, 767, 424 N.E.2d 719; People ex rel. Hawkonsen v. Conlisk (1970), 119 Ill. App. 2d 431, 439, 256 N.E.2d 99; Chicago Motor Coach Co. v. Budd (1952), 346 Ill. App. 385, 390, 105 N.E.2d 140.) Accordingly, we find no abuse of the court’s wide discretion in denying to plaintiffs the temporary injunctive relief they sought. McCormick v. Empire Accounts Service, Inc. (1977), 49 Ill. App. 3d 415, 419, 364 N.E.2d 420.

Plaintiffs maintain that in a contract consisting of both handwritten and typewritten provisions, the writing will prevail over the typing if there is a conflict, citing 12 Ill. L. & Prac. Contracts sec. 227 (1955), and Summers v. Hibbard, Spencer, Bartlett & Co. (1894), 153 Ill. 102, 38 N.E. 899. However true this observation may be, it is inapposite to the decisive issue in this controversy since it implicitly presupposes a valid integration of both handwritten and typewritten provisions, the very existence of which was at issue here.

Plaintiffs argue that because Malloy did install a sink and a clear glass door referred to in handwritten paragraph 4 of Exhibit B, he obviously knew of paragraph 5 which followed in handwriting, to which, by implication, he consented. The circuit court could have reasonably found, however, that plaintiffs’ letter of May 23, 1979, to Malloy requesting these same improvements generated Malloy’s performance, rather than the handwritten paragraph 4, particularly since nothing in the lease or its attachments mentions electrical work to be performed. The May 23 letter, however, does request such work, and electrical work was performed in the leased premises at or about the same time the other work was performed.

Plaintiffs’ argument that the attorney for defendants admitted during the proceedings that the exclusive rights clause was part of the agreement is untenable. The purported admission was made in response to a question by the court. The court appeared to interpret counsel’s ambiguous remark as conceding that the clause was physically included in the lease, considerably different from admitting that it was part of the agreement.'We find no reason to disturb the court’s understanding here.

The dismissal from which the companion appeal was taken was entered after a full evidentiary hearing, with witnesses having been presented by each of the parties together with documentary evidence and the opportunity to argue their respective viewpoints. Nothing further was sought to be presented by any party prior to the court’s ruling, and none seek remandment for presentation of additional evidence. In this posture of the case, the trial court was in a position to treat count I on its merits, which the dismissal has accomplished, in effect, under these circumstances, amounting to a denial of the permanent injunctive relief sought. (See Pfeffer v. Lebanon Land Development Corp. (1977), 46 Ill. App. 3d 186, 193-94, 360 N.E.2d 1115; James B. Beam Distilling Co. v. Foremost Sales Promotions, Inc. (1973), 13 Ill. App. 3d 176, 178, 300 N.E.2d 488. See also Kohan v. Rimland School for Autistic Children (1981), 102 Ill. App. 3d 524, 528, 430 N.E.2d 139.) A permanent injunction may not be awarded except in a clear and affirmative case. (Vulcan Detinnig Co. v. St. Clair (1924), 315 Ill. 40, 145 N.E. 657; Pfeffer v. Lebanon Land Development Corp. (1976), 46 Ill. App. 3d 186, 194; Staley v. Mears (1957), 13 Ill. App. 2d 451, 457, 142 N.E.2d 835.) Count I and the proof submitted in relation to it in the present case does not meet that criterion and was, therefore, properly dismissed.

Other issues raised on appeal need not be addressed in view of our disposition of the controversy. The judgment of the circuit court is affirmed for the reasons set forth above.

Affirmed.

STAMOS, P. J., and PERLIN, J., concur.

       The parties referred to the requested injunction order as a “temporary injunction,” both at trial and on appeal. This term is no longer appropriate. (Ill. Rev. Stat. 1979, ch. 69, pars. 3, 3 — 1; Schwalm Electronics, Inc. v. Electrical Products Corp. (1973), 14 Ill. App. 3d 348, 349 n.2, 302 N.E.2d 394.) Accordingly, references to the trial court proceedings will be made to a “preliminary injunction.”

       Executed with predecessor lessors not herein involved.


source: Caselaw Access Project

author: JUSTICE McGILLICUDDY

license: Public Domain

text:
    THE NORTHERN TRUST COMPANY, Plaintiff-Appellee, v. OXFORD SPEAKER COMPANY, Defendant-Appellant.
    First District (3rd Division)
    No. 81—0195
    Opinion filed September 22, 1982.

      Winston & Strawn, of Chicago (Frank O. Wetmore II, Robert E. English, and David W. Russell, of counsel), for appellant.
    Baker & McKenzie, of Chicago (Francis D. Morrissey, James G. Barnes, and Terrence M. Johnson, of counsel), for appellee.
   JUSTICE McGILLICUDDY

delivered the opinion of the court:

This action was brought by The Northern Trust Company (Northern), the appellee, to recover losses it suffered after paying a documentary draft that was transferred to it by Oxford Speaker Company (Oxford), the appellant. The documentary draft, drawn against a letter of credit, had been dishonored by the issuer of the letter of credit; and Oxford had disclaimed liability to Northern. In its answer- to Northern’s complaint, Oxford raised affirmative defenses including waiver and estoppel. The trial court granted summary judgment in favor of Northern, and this appeal followed.

On appeal, Oxford contends that the court erred in entering summary judgment in favor of Northern because its equitable defenses barred Northern’s legal bases for recovery and because material questions of fact existed with respect to those equitable defenses.

According to the pleadings and affidavits filed in the case at bar, Oxford agreed to sell speakers to an Indonesian company, C. V. Kawi Trading Company (Kawi). Kawi was to be responsible for shipping and freight, and the transaction was to be financed by an irrevocable international letter of credit in the amount of $49,000. Northern advised Oxford that a letter of credit had been issued on January 6, 1977, by the Banque de l’lndochine et de Suez (the Singapore bank). The credit, which had been applied for by Kawi’s customer, Tong Wei Hang Trading Company (Tong Wei Hang), provided, however, that Oxford would arrange for shipping to Indonesia at its own expense.

Oxford’s response in opposition to Northern’s motion for summary judgment and the affidavit of David Davis, vice-president of Oxford, in support thereof, stated that on February 1, 1977, Davis met with Naran Patel, second vice-president and supervisor of Northern’s letter of credit operations to ascertain and resolve the conflicts between the terms of the letter of credit and Oxford’s agreement with Kawi. Davis informed Patel that Oxford was not familiar with letter of credit transactions and that Oxford did not want to be responsible for shipping the speakers. Patel assured Davis that Oxford could ship against the letter of credit and recover its shipping expenses if it followed Northern’s instructions.

Oxford’s response and Davis’ affidavit further stated that Naran Patel provided written instructions regarding shipping arrangements and the preparation of documentary drafts. On March 29, 1977, Oxford shipped the speakers and documents, prepared in accordance with Patel’s instructions, to Kawi’s Los Angeles agent, James A. Barnhart, for further shipment of the speakers overseas. On April 1, 1977, another Northern employee prepared documents for Oxford assigning a portion of the letter of credit proceeds to Barnhart for the freight charges on the shipment of the speakers to the destination indicated in the letter of credit. Oxford paid Northern a minimal handling fee with respect to the shipping arrangements.

On April 5, 1977, Northern received from Barnhart drafts drawn against the letter of credit and the final shipping documents. The documents indicated that the speakers were to be discharged at Singapore. Northern refused to honor the drafts prepared by Barnhart and instead prepared a new documentary draft for Oxford’s execution. On April 6, 1977, Oxford signed the draft in the amount of $48,667.96 as drawer and as indorser; and Northern sent a telegram to the French American Banking Corporation of New York asking that bank to credit Northern’s account in the amount of the draft and its charges and certifying that “all terms of the credit have been complied with.” Northern was notified on April 21, 1977, that the Singapore bank had dishonored Oxford’s draft because the speakers had been shipped to Singapore rather than Indonesia. Northern sent notice of the dishonor to Oxford on May 4,1977, and demanded repayment.

After Oxford disclaimed liability, Northern exercised its option to cure the shipping error. Tong Wei Hang agreed to purchase the speakers for $38,957.96. Northern then demanded that Oxford reimburse it in the amount of $9,710, the difference between the amount of the draft it had paid Oxford and the amount it had recovered from Tong Wei Hang. Northern filed the instant cause of action on May 1, 1979, and its motion for summary judgment was granted and judgment was entered in the amount of $12,373.84 consisting of principal of $9,710 and interest and incidental costs of $2,663.84.

The basis upon which the trial court granted summary judgment was not specified in the record. Northern had argued in its complaint and motion for summary judgment that it was entitled to recover based on its statutory right of recourse since the documentary draft had been dishonored and because Oxford had breached certain statutory warranties with respect to the draft. Specifically, Northern argued that Oxford as drawer and indorser on the documentary draft had engaged that upon the draft’s dishonor and necessary notice of dishonor and protest, it would pay the amount of the draft to the holder. (Ill. Rev. Stat. 1977, ch. 26, pars. 3 — 413(2), 3 — 414(1).) Northern also relied on its right of recourse under banking laws that a customer who transfers an item and receives settlement or other consideration engages that upon dishonor and notice and protest, he will take up the item. (Ill. Rev. Stat. 1977, ch. 26, par. 4 — 207(2).) The statutory warranty that Oxford was alleged to have breached when it delivered the draft to Northern was that the conditions of the letter of credit had been complied with. Ill. Rev. Stat. 1977, ch. 26, par. 5— 111(1).

As an affirmative defense and in its response in opposition to Northern’s motion for summary judgment, Oxford argued that Northern, in its dealings with Oxford, waived the terms of the letter of credit and was estopped to deny that the documentary draft complied with the letter of credit. Oxford alleged that Northern had given it oral and written instructions with respect to drawing a documentary draft which would comply with the letter of credit; that Northern had assured Oxford that if Oxford followed its instructions, the discrepancies with respect to shipping would be resolved; that Northern had assembled and prepared the nonconforming documentary draft for Oxford’s signature; and that Northern had informed and instructed Oxford that the documentation with the draft was proper. Oxford contended that it had a right to rely upon the expertise, guidance, assistance, instruction and direction of Northern with regard to the preparation and submission of the documentary draft; that Oxford had a right to believe that the draft would conform to the letter of credit requirements; and that Oxford had relied upon Northern’s representations and assurances to its detriment.

The first issue we must deal with on appeal is whether the equitable defenses of waiver and estoppel apply to letter of credit transactions. Section 1 — 103 of the Uniform Commercial Code provides that principles of law and equity, including the law relevant to estoppel, shall supplement the provisions of the Code unless displaced by particular provisions of the Code. (Ill. Rev. Stat. 1977, ch. 26, par. 1 — 103.) No provisions indicate that the doctrines of waiver or estoppel are inapplicable to letters of credit transactions (Barclays Bank D.C.O. v. Mercantile National Bank (5th. Cir. 1973), 481 F.2d 1224, cert. dismissed (1974), 414 U.S. 1139, 39 L. Ed. 2d 96, 94 S. Ct. 888), and those defenses have been applied where proper factual settings existed (e.g., U.S. Industries, Inc. v. Second New Haven Bank (D. Conn. 1978), 462 F. Supp. 662; North Valley Bank v. National Bank (N.D. Ill. 1977), 437 F. Supp. 70). In Barclays Bank D.C.O., the court therein recognized that it had a duty to apply equitable principles and to:

“*** construe Article 5 [Uniform Commercial Code — Letters of Credit], as well as the other rules relating to letters of credit not codified in this Article, in such a manner as to conform the rules to an underlying sense of fair play so that the expectations of the parties to a business transaction will not be frustrated by the application of a rule which is not grounded in sound policy considerations.” 481 F.2d 1224, 1237.

Northern contends, however, that in the cases cited above the application of equitable defenses was conditioned upon a showing that, but for the bank’s conduct, the drawer of the draft could have cured the defective draft before the letter of credit expired. Northern argues that in the instant case, Oxford could not have cured the shipping defect since the letter of credit was due to expire on April 6, the speakers left California for Singapore on April 3, and the bill of lading indicating the erroneous destination was not received by Northern until April 5, 1977.

Northern also relies on the case of First National City Bank v. Klatzer (N.Y. Sup. Ct. 1979), 28 U.C.C. Rep. 497. In Klatzer the plaintiff bank erroneously and carelessly paid out on a draft drawn pursuant to a letter of credit. The issuing bank refused to honor the draft due to defective documentation. The court held that the unilateral mistake by the plaintiff in paying out funds was sufficient to support a claim by the bank against the drawer of the dishonored draft for reimbursement.

We believe Klatzer is distinguishable from the instant case because in Klatzer the plaintiff bank merely operated as a collecting bank. In the case at bar, however, Northern, by its alleged conduct, became more than a collecting bank. Oxford alleges that Northern gave it advice and made certain assurances with regard to completion of the sales transaction and preparation of the necessary documents. It is because of these alleged actions that Northern may be barred from recovery.

We also reject Northern’s attempt to limit the waiver and estoppel defenses to cases wherein the documentation defects could have been rectified within the time limits specified in the letters of credit. While it is true that the time for cure had not expired in the cases cited above, we do not believe that the defenses of waiver and estoppel should be limited to such specific circumstances.

Generally, the defense of waiver applies when a party intentionally relinquishes a known right or his conduct warrants an inference of such relinquishment. (Lempera v. Karner (1979), 79 Ill. App. 3d 221, 398 N.E.2d 224.) It is not the same as estoppel in that in a waiver it is not necessary that the party claiming the waiver should have been misled to his injury by the acts of the insurer, or that prejudice result to the party in whose favor the waiver operates. (A-1 Cleaners & Dyers v. American Mutual Liability Insurance Co. (1940), 307 Ill. App. 64, 30 N.E.2d 87.) Equitable estoppel is defined as the effect of the voluntary conduct of a party whereby he is absolutely precluded, both at law and in chancery, from asserting rights which might otherwise have existed as against another person who has, on good faith, relied upon such conduct and has been led thereby to change his position for the worse. (Ladd Construction Co. v. Insurance Co. of North America (1979), 73 Ill. App. 3d 43, 391 N.E.2d 568; Hartford Accident & Indemnity Co. v. D. F. Bast, Inc. (1977), 56 Ill. App. 3d 960, 372 N.E.2d 829.) A fraudulent intent is not necessary to estoppel. When a person apparently adopts a position which reasonably misleads someone into detrimental reliance, that person can be es-topped from avoiding that position, regardless of the intent of his actions, if to hold otherwise would have an unjust effect. Shockley v. Ryder Truck Rental, Inc. (1979), 74 Ill. App. 3d 89, 392 N.E.2d 675; see Lincolnland Properties, Inc. v. Butterworth Apartments, Inc. (1978), 65 Ill. App. 3d 907, 382 N.E.2d 1250 (promissory estoppel).

According to the affidavit of Oxford’s vice president, David Davis, Davis informed Northern’s employee, Naran Patel, that Oxford had no familiarity with letter of credit transactions and that Oxford would not complete the sales transaction with Kawi if Oxford was to be responsible for shipping arrangements and costs. Patel assured Davis that Oxford could ship against the letter of credit and recover its shipping costs if it followed Northern’s instructions. Oxford also alleged that Patel provided oral and written instructions on how to ship the goods and prepare documentary drafts. Northern prepared the documentary draft for Oxford’s signature and subsequently stated to the French American Banking Corporation of New York that all the terms of the letter of credit had been complied "with.

Oxford also contended in its answer and response in opposition to the motion for summary judgment that it relied in good faith on Northern’s assurances and expertise in order to comply with the letter of credit requirements; that it would not have participated in the sales transaction but for Northern’s assurances and aid; and that its reliance was detrimental since the letter of credit conditions were not in fact complied with. Based on these allegations, we believe that genuine issues of material fact existed as to whether Northern should be estopped from claiming its legal rights to repayment after the draft was dishonored and whether Northern waived those rights by indicating that the terms of the letter of credit had been complied with. To find otherwise would have an unjust effect (Schockley v. Ryder Truck Rental, Inc.) and would not conform to a sense of fair play (Barclays Bank D.C.O. v. Mercantile National Bank).

Northern’s final arguments in support of its summary judgment are that Oxford’s recourse obligations could not be disclaimed by parol evidence and that Northern could not be obligated to Oxford on the letter of credit absent Northern’s written confirmation (Ill. Rev. Stat. 1977, ch. 26, pars. 5-103(1)(f), 5 — 104(1)). These arguments relate, however, to Northern’s legal rights and obligations as codified in the Uniform Commercial Code. The equitable doctrines of waiver and estoppel bar the enforcement of a party’s legal rights due to that party’s conduct and, in the case of estoppel, the effect of that conduct on another party’s actions. Thus Oxford’s defenses to Northern’s cause of action do not depend on whether Northern confirmed payment of the letter of credit in writing, and to support these defenses Oxford should be permitted to present evidence of its oral and written dealings and communications with Northern.

For the foregoing reasons, the summary judgment of the circuit court of Cook County is reversed and the cause is remanded for an evidentiary hearing on the issue of waiver and estoppel consistent with the views expressed herein.

Reversed and remanded.

WHITE, R J., and RIZZI, J., concur.

       Oxford pleaded as additional affirmative defenses that Northern had not given timely notice of dishonor and that Oxford was discharged from liability pursuant to section 3 — 601(2) of the Uniform Commercial Code (Ill. Rev. Stat. 1977, ch. 26, par. 3-601(2)).

       The affidavit of Naran Patel stated that Northern notified Oxford of the dishonor on May 2, 1977.

       In its reply brief, Oxford states that it could prove at trial that the expiration date of the letter of credit had been extended to May 6, 1977. Oxford also states that it could prove that had Northern given it notice of the dishonor on April 21, 1977, Oxford could have cured the shipping defect by redirecting the speakers to the proper port.


author: PRESIDING JUSTICE JOHNSON

text:
      In re APPLICATION OF COOK COUNTY TREASURER AND EX-OFFICIO COLLECTOR. (Joseph Wahrer et al., Intervening Objectors-Appellants.)
    First District (4th Division)
    No. 81—2066
    Opinion filed September 23, 1982.
    Rehearing denied October 27, 1982.

      James A. Rooney, of Chicago, for appellants.
    Richard M. Daley, State’s Attorney, of Chicago (Jane Clark Casey, Thomas J. McNulty, and Randye A. Kogan, of counsel), for appellee County Collector of Cook County.
   PRESIDING JUSTICE JOHNSON

delivered the opinion of the court:

Objectors, Joseph and Gretchen Wahrer, appeal from the trail court’s denial of certificates of error issued by the Cook County assessor. They raise the following issues for review: (1) whether the trial court may impose different and further requirements on a taxpayer who intervenes in a certificate of error proceeding than are imposed upon the assessor when the certificate is presented by that public official on behalf of the taxpayer; (2) whether the trial court may substitute its judgment for that of the assessor when the latter confesses that he made an error in the assessment of property; (3) whether the doctrine of separation of powers precludes the trial court from denying a validly executed certificate of error; and (4) whether the trial court’s decision denying the certificates was against the manifest weight of the evidence.

We affirm.

For 1978, intervening objectors Joseph and Gretchen Wahrer (hereinafter the taxpayers) owned and paid taxes on property which was used as a “mini-warehouse,” a personal storage facility containing cubicles rented on a month-to-month basis. The mini-warehouse had opened in late 1977 and contained a total of 295 units in three sizes: 50, 150 and 250 square feet. The number of units rented in 1978 varied from a low of 50 in January to a high of 210 in October. The taxpayers estimated average occupancy for 1978 as approximately 50%, but they kept no monthly statistics on the total amount of space rented. Total rentals for the property for 1978 amounted to $91,793.

On August 25, 1979, taxpayers’ attorney sent a letter to the Cook County assessor suggesting that certificates of error be submitted for their property for 1978. For that year, the mini-warehouse had received a full assessment. Taxpayers believed the property should have received a partial assessment based upon initial occupancy and reduced gross income. Taxpayers asked that the assessment be reduced from $226,600 to about $160,000. The assessor granted certificates of error to reduce the assessment to $207,540. At a hearing on July 7, 1981, the assistant State’s Attorney, Ronald Hubka, presented certificates Nos. 3080 and 3081 to the circuit court as objections in the 1978 application for judgment and order of sale against taxpayers’ property. Approval of the certificates would mean that the taxpayers would be entitled to a refund of 1978 real estate taxes.

At the hearing, Hubka discussed the basis for the reduced assessment:

“MR. HUBKA: *** I will tell you he [taxpayers’ attorney] went through a very nice workout. What I did is looked and found the assessor worked it on an income approach. Mr. Rooney [taxpayers’ attorney] wanted to do it on an occupancy approach. But I think the bottom line I found was a depreciable base.”

Later, the court inquired:

“THE COURT: Well, how do you work a market based on partial occupancy? That is a theoretical question.
MR. HUBKA: Very difficult. The assessor used to have the old workout for apartment buildings.
THE COURT: You can’t use that, because they already used up first year occupancy and *** I am very reluctant to use a purported figure because the owner *** says for the last four months of the year the occupancy range is 205 and 210 units; but he can’t tell us whether it is the 50 square foot units, the 150 square foot units, or 250 square units.
What theory are we really going on? As it is established that it is only partially occupied. There is partial occupancy.
MR. HUBKA: The theory of the taxpayer is partial occupancy. The theory of the assessor is take an economic workout. To me, the assessor did it anyway, you know worked out partial occupancy, was run on certainly an economic workout. I think the gross rentals, less the actual expenses.
* * *
MR. HUBKA: Well, in effect you are saying that the theory of the taxpayer was occupancy; the theory of the assessor is economics.
THE COURT: Neither one satisfies, is completely satisfactory.
MR. HUBKA: Yes. The complaint is on occupancy; they can probably bring in leases to show the percentage for each month. The assessor normally has a method for working that out up until it gets it for full occupancy. We have had that for a year before or two, as it is being leased out, they take a percentage each month.
THE COURT: Yes, but *** you are going to have trouble doing it, because *** no monthly breakdown was kept as to the units that were rented each month, so how is he [the owner] going to tell which is which?
I do not have the data on which to arrive at something satisfactory, so the objection will be denied ***.”

Taxpayers then filed a petition to intervene which was granted. They filed an objection which the collector moved to dismiss and a motion to vacate the order denying certificates of error. Taxpayers prayed that the certificates of error be granted and a refund made to them. The trial court granted collector’s motion to dismiss and denied taxpayers’ motion to vacate. It explained its rulings as follows:

“THE COURT: I think the motion to dismiss is well taken in part, but I granted leave to intervene, which *** was granted if there was an application for judgment against these two parcels of property for the year 1978.
The intervention was *** a matter of right because the people are the owners of the property.
*** [T]he motion on behalf of the Objectors, ***, was denied because they have no standing to move to vacate the Assessor’s objection, but leave was given for the owners of the property to intervene on the application for judgment in the proceedings against this property ***.
The objection and the other pleadings on their face show there was no exhaustion of administrative remedies, which is a requirement to maintain a specific objection, which the taxpayers have been allowed to intervene for the purpose of presenting; in addition to which, Section 675 of the Revenue Act requires that taxes be paid under protest in order for a specific objection to be maintained.
The pleadings show that although the taxes were in fact paid, that they, were not paid under protest, so for those reasons, I would grant the motion to dismiss the intervening objection of Mr. and Mrs. Wahrer. ***.
*** [Taxpayers] are entitled to intervene in the collector’s application. In other words, I am treating it *** just the same as a late objection.”

Taxpayers appeal from this decision.

At issue in this case is whether the trial court erred in any manner in denying the certificates of error. Taxpayers argue that absent fraud the trial court has no jurisdiction to deny a validly executed certificate of error. According to taxpayers, the presentation of a certificaté of error is the presentation of a consent judgment. No weighing of evidence is contemplated or necessary. In the certificate of error proceedings, the court is limited to an inspection of whether the agreement was properly executed. If it was, and no fraud was apparent, the court’s duty is to enter the judgment according to its terms. Taxpayers contend that the court is involved in the proceeding merely to protect the collector by entry of an order adjudicating what monies listed in the warrant books he does not owe to taxing bodies. In other words, the court enters an order to make the collector’s books balance and to protect him from suit. Finally, taxpayers argue that the interests of society would be protected in a virtual “rubber stamp” proceeding because the assessor admits error in a very small percentage of cases, and because the statute requires that the certificate state the nature of the error, and that such certificate becomes part of the court records.

We disagree with taxpayers’ contentions. Section 123 of the Revenue Act of 1939 (Ill. Rev. Stat. 1979, ch. 120, par. 604) provides as follows:

“In counties containing 1,000,000 or more inhabitants, if, at any time before judgment is rendered in any proceeding to collect or to enjoin the collection of taxes based upon any assessment of any property belonging to any person or corporation, the county assessor shall discover an error or mistake in such assessment, such assessor shall execute a certificate setting forth the nature of such error, and the cause or causes which operated to produce it. The certificate when endorsed by the county assessor, or when endorsed by the county assessor and board of appeals where the certificate is executed for any assessment which was the subject of a complaint filed in the board of appeals for the tax year for which the certificate is issued, may be received in evidence in any court of competent jurisdiction. When so introduced in evidence such certificate shall become a part of the court records, and shall not be removed from the files except upon the order of the court.
A certificate executed pursuant to this Section may be issued to the person erroneously assessed or may be presented by the assessor to the court as an objection in the application for judgment and order of sale for the year in relation to which the certificate is made.”

We interpret the phrase, “may be received in evidence in any court” to mean that the trial court has discretion to accept or reject the certificates. Except when the trial court has abused its discretion, a court of review will not interfere with the manner in which it was exercised. (Hill v. Meister (1971), 133 Ill. App. 2d 678, 683, 273 N.E.2d 643, 647.) We have examined the record in this case. In our opinion, the trial court did not abuse its discretion in denying the certificates of error.

Taxpayers also raise constitutional objections to the trial court’s decision. They argue that since the trial court did not limit their rights when the petition to intervene was granted, they had all the rights of the original objector, the Cook County assessor. Yet, the trial court ruled that taxpayers could not prosecute their objection. At a hearing on August 18, 1981, the trial court granted the collector’s motion to dismiss taxpayers’ intervening objection. Taxpayers contend this ruling effectively prevented them from utilizing the rights they obtained through intervention.

Taxpayers also allege that their rights under the equal protection clauses of the Illinois and United States constitutions were violated. Taxpayers contend the following:

“[Tjhere is no rational basis for allowing the assessor to file the certificates as objections to the annual application for judgment without regard as to whether a complaint was filed with the Board of Appeals or whether the taxes were paid under protest but denying the taxpayers their day in court because of a failure to comply with those technicalities. Moreover, in requiring the execution of a certificate by the Board of Appeals only where an assessment complaint has been filed with that body, the certificate of error statute itself contemplates that certificates may be presented where no complaint has been filed with the Board of Appeals.”

In Chicago Sheraton Corp. v. Zaban (1978), 71 Ill. 2d 85, 92, 373 N.E.2d 1318, 1321, our supreme court rejected the contention that section 123 of the Revenue Act of 1939 (Ill. Rev. Stat. 1979, ch. 120, par. 604) violates the right to due process. It stated that “plaintiff had neither a statutory nor constitutional right to participate in the certificate of error proceeding or to challenge any alleged irregularities in that proceeding.” 71 Ill. 2d 85, 92.

In Van Driel Drug Store, Inc. v. Mahin (1970), 47 Ill. 2d 378, 382, 265 N.E.2d 659, 661, our supreme court stated:

“ ‘Where the constitutional validity of a statute is assailed the objection must be specific and complete. It is not enough merely to assert in a vague and general fashion that constitutional safeguards are violated. The particular respect in which the statute violates some constitutional limitation must be pointed out and preserved for review in order to obtain a determination of such questions by this court.’ ”

Taxpayers merely conclude that allowing the assessor to file objections while denying taxpayers a day in court is unconstitutional. They do not explain how section 123 violates the equal protection clause and cite no authority for their position. An examination of taxpayers’ argument fails to reveal its basis. Thus, we are unable to review this issue on appeal.

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

Affirmed.

LINN and JIGANTI, JJ., concur.


author: PRESIDING JUSTICE WHITE

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. SHAWN BEASLEY et al., Defendants-Appellants.
    First District (3rd Division)
    Nos. 80—1874, 80—1875 cons.
    Opinion filed September 22, 1982.
    Rehearing denied October 19, 1982.

      Ralph Ruebner, Steven Clark, and Bradley S. Bridge, all of Chicago, for appellants.
    Richard M. Daley, State’s Attorney, of Chicago (Michael E. Shabat, Lester M. Joseph, and Richard B. Levy, Assistant State’s Attorneys, of counsel), for the People.
   PRESIDING JUSTICE WHITE

delivered the opinion of the court:

After a jury trial, defendants, Shawn Beasley and Larry Banks, were found guilty of burglary and sentenced to the Illinois Department of Corrections for terms of six years. On appeal, they contend: (1) that improper cross-examination of defense witnesses and improper rebuttal closing argument by the prosecution deprived them of a fair trial; (2) that the trial court erred when it admitted photographic evidence of fingerprints into evidence without sufficient foundation; and (3) that the trial court abused its discretion when it denied defendant Banks’ petition for treatment under the Dangerous Drug Abuse Act (Ill. Rev. Stat. 1979, ch. 91½, par. 120.1 et seq.).

I

Defendants first argue that several errors made by the prosecution in cross-examination and closing argument deprived them of a fair trial. These alleged errors can be classified in 10 categories: (1) cross-examination of defense witnesses as to whether other witnesses were lying or were wrong; (2) failure by the prosecution to prove up its impeachment of defendant Banks; (3) cross-examination as to defendant Banks’ post-arrest silence; (4) cross-examination of defendant Banks’ alibi witnesses as to why they had not informed authorities that they were with Banks on the evening of the crime; and (5) closing argument comments which (a) allegedly deprecated the reasonable doubt standard; (b) allegedly disparaged the presumption of innocence; (c) allegedly suggested to the jury that it was allied with the State in the prosecution of crime; (d) allegedly informed the jury that it was not to be concerned with the rights of defendants; (e) allegedly misrepresented the evidence; and (f) allegedly impugned the integrity of defense counsel. Defendants contend that these alleged errors, when viewed cumulatively, amounted to reversible error. Significantly, except for alleged errors falling within the fourth category, no objection was made at trial to the allegedly improper cross-examination and closing argument. Moreover, neither defendant raised any of these alleged errors in his written motion for new trial.

Failure to make a timely objection at trial to the admission of evidence operates as a waiver of the right to consider the question on review. (People v. Baynes (1981), 88 Ill. 2d 225, 230, 430 N.E.2d 1070; People v. Carlson (1980), 79 Ill. 2d 564, 576, 404 N.E.2d 233.) And if a defendant fails to make a timely objection at trial to allegedly improper closing argument, such error is deemed waived. (People v. Lucas (1981), 88 Ill. 2d 245, 250, 430 N.E.2d 1091; People v. King (1977), 66 Ill. 2d 551, 559, 363 N.E.2d 838, cert. denied (1977), 434 U.S. 894, 54 L. Ed. 2d 181, 98 S. Ct. 273.) Moreover, failure by a defendant to raise an issue in his written motion for a new trial constitutes a waiver of that issue. People v. Lucas (1981), 88 Ill. 2d 245, 250; People v. Pickett (1973), 54 Ill. 2d 280, 282, 296 N.E.2d 856.

However, the waiver rule is not absolute, and error that rises to the level of plain error may be considered by a reviewing court despite the defendant’s failure to preserve properly the record for review. (People v. Baynes (1981), 88 Ill. 2d 225, 230; People v. Jackson (1981), 84 Ill. 2d 350, 359, 418 N.E.2d 739.) This exception to the waiver rule is embodied in Supreme Court Rule 615(a) (73 Ill. 2d R. 615(a)), which provides:

“Plain errors or defects affecting substantial rights may be noticed although they were not brought to the attention of the trial court.”

Our supreme court has established the following test for applying the plain error doctrine:

“The doctrine of plain error may be invoked in criminal cases where the evidence is closely balanced or where the error was of such magnitude that the accused was denied a fair trial.” (People v. Lucas (1981), 88 Ill. 2d 245, 251; People v. Carlson (1980), 79 Ill. 2d 564, 576-77.)

The evidence here was not closely balanced as to either defendant. See People v. Carlson (1980), 79 Ill. 2d 564, 576.

Erbie Wadlington, co-owner of Community Grocery and Liquor Store located at 1018 East 93d Street in Chicago, testified that he arrived at his store at approximately 12:30 a.m. on August 22, 1979, and observed that screen bars covering the front window had been removed, that front and rear windows of the store had been broken, that liquor bottles were out of place, and that a box which was kept near the liquor counter and contained approximately $150 was missing.

Darren Bloomingberg testified that on August 22, 1979, shortly after midnight, he was walking east on 93d Street to his home when he observed defendants Beasley and Banks standing in front of the store. Bloomingberg was acquainted with both defendants. He noticed that the store’s window had been broken and asked defendants what they were doing. Banks replied that they were trying to take some money. Then Bloomingberg walked away. After walking a short distance, Bloomingberg heard what he described as a “large sound like snatched bars off the window.” Bloomingberg turned around and saw both defendants placing bars from the window on the ground. Then he saw Beasley crawl into the store through a hole in the window, and after this, he saw Banks bend down near the hole. At this point, Bloomingberg turned around and continued to walk home. He did not see Banks enter the store. Later that day, Bloomingberg returned to the store and spoke to one of the owners about the break in.

Fingerprint evidence corroborated Bloomingberg’s testimony. A Chicago police officer testified that latent prints found on the window of the store belonged to defendant'Beasley.

Officers Dean Casper and Byron Bradley of the Chicago police department testified that Beasley admitted to them that he had removed burglary bars from the store window, that he entered the store, and that he took bottles of vodka and cash. Beasley also stated that he would not sign any written statement.

At trial both defendants presented alibis. Banks testified that he was at home at the time of the burglary. His mother, sister and girlfriend gave similar testimony. Beasley’s alibi testimony had no corroboration.

We do not consider the evidence to be so closely balanced as to constitute a basis for the application of the plain error doctrine. Further, we do not find that the cumulative effect of the alleged errors was of such magnitude that defendants were denied a fair trial.

II

Defendants next argue that photographic evidence of fingerprints was admitted into evidence without proper foundation, denying them a fair trial. Specifically, they contend that the admission of two photographic negatives was improper because there was no testimony that the negatives were a fair and accurate representation of the fingerprint lift the expert had taken. Similarly, defendants assert that there was no adequate foundation for admission of a photographic enlargement of one of the negatives and a photographic enlargement of a print of the third finger of Beasley’s right hand obtained from Beasley’s fingerprint card, because there was no testimony that either enlargement was a fair and accurate representation of the item it purported to represent.

The State responds that defendants have waived consideration of these issues on review because defendants failed to specify them in their written motion for a new trial and because defense counsel’s objections at trial were based on different grounds. Although these issues may be considered to have been waived (see People v. Pickett (1973), 54 Ill. 2d 280, 282, 296 N.E.2d 856), we have elected to consider them because the fingerprint evidence was a substantial factor in each defendant’s conviction.

We are of the opinion that the testimony of two Chicago police officers was sufficient to establish a foundation for the admission of these exhibits into evidence. Officer Dieringer testified in detail about finding the fingerprints on the window. He placed an identification tag near the fingerprints and took two photographs of them and the tag. Then he lifted the fingerprints and tag. He identified the negatives in evidence as the photographs he took. No error is assigned to the admission into evidence of the fingerprint lift, and the two negatives clearly show the identification tag that is part of the lift. In fact, the writing on the tag can be read on the negatives.

Officer Patterson, a latent print examiner, testified that he compared the negatives with a fingerprint card of defendant Beasley, and that it was his conclusion that the latent prints depicted in the negatives were the prints of the right middle and right index finger of defendant Beasley. He also testified that he prepared the photographic enlargements in order to demonstrate to the jury how a fingerprint comparison is made. He then testified as to similarities in the two enlargements.

Defendants rely upon People v. Donaldson (1962), 24 Ill. 2d 315, 181 N.E.2d 131, People v. Eagle (1979), 76 Ill. App. 3d 427, 395 N.E.2d 155, and People v. Mines (1971), 132 Ill. App. 2d 628, 270 N.E.2d 265. Donaldson and Mines involve the admissibility of photographs generally. For a photograph to be admissible in evidence, the photograph must be identified by a witness as a portrayal of certain facts relevant to an issue and be verified by such witness on personal knowledge as a correct representation of these facts. People v. Donaldson (1962), 24 Ill. 2d 315, 318; People v. Mines (1971), 132 Ill. App. 2d 628, 631.

Here the negatives were susceptible to identification by sight, and Dieringer identified them as the negatives of the photographs he took of the fingerprints before lifting them. (See People v. Rhodes (1980), 81 Ill. App. 3d 339, 348, 401 N.E.2d 237, aff'd (1981), 85 Ill. 2d 241.) In the absence of any objection at trial to the lack of testimony that the negatives were true and accurate representations of the fingerprints, we conclude that the testimony of Dieringer was sufficient to admit the negatives into evidence. In this regard, we note that the positive identification of the negatives by Dieringer was not impeached in any way. People v. Eagle (1979), 76 Ill. App. 3d 427, 436.

Furthermore, we conclude that in the absence of any objection at trial to the lack of testimony that the enlargements were true and accurate representations of the items they purported to represent, Patterson’s testimony that he prepared the enlargements was sufficient to justify their admission into evidence.

Defendants also argue that the copy of Officer Dieringer’s report was improperly admitted into evidence over defense counsel’s objection that the best evidence rule precluded its admission. Dieringer, in his testimony, identified an exhibit as the report he submitted, along with the lift and the negatives, to a crime laboratory. He did not indicate that it was, in fact, a copy. In admitting the report into evidence, however, the trial court stated that it appeared to be a copy. The report is included in the record on appeal, and it appears to be a carbon copy of an evidence report.

There is authority for the position that a carbon copy of an original, which is made at the same time and by one impression of a typewriter or by the same stroke of a pen, is admissible without accounting for the original. (People v. Hauke (1929), 335 Ill. 217, 231, 167 N.E. 1; McCormick, Evidence sec. 236, at 568 (2d ed. 1972).) Further, we are of the opinion that any error in admitting the report into evidence was harmless. The report (assuming it is a copy) states only such general information as the nature and location of the offense, the victim’s name, and that an imprint was taken from the broken front window. Under the “Details of Case” section, the report states: “Burglary N/R entry through front window exit back window.” The fact that there was a burglary and that entry was made through the front window was established by the prosecution witnesses. Under these circumstances, we are compelled to conclude that the admission into evidence of the report could not have contributed to the jury’s verdicts.

Ill

Lastly, defendant Banks contends that recent amendments to the Dangerous Drug Abuse Act required the trial court to order an examination of Banks by the Department of Mental Health and Developmental Disabilities to determine whether he was an addict and likely to be rehabilitated through treatment, and that the trial court erred when it failed to do so. At the time of the sentencing hearing, June 25, 1980, section 10 of the Act (Ill. Rev. Stat. 1979, ch. 911/2, par. 120.10), in relevant part, provided:

“If a court has reason to believe that an individual convicted of a crime is an addict or the individual states that he is an addict and the court finds that he is eligible to make the election provided for under Section 8, the court shall advise him that he may be placed on probation if he elects to submit to treatment and is accepted for treatment by the Department [of Mental Health and Developmental Disabilities]. ***
If the individual elects to undergo treatment *** the court shall order an examination by the Department to determine whether he is an addict and is likely to be rehabilitated through treatment. ***” (Emphasis added.)

This section had been amended by Public Act 81 — 851, effective September 20, 1979, which substituted “shall” (underlined in the above quotation) for “may.”

Prior to the amendment substituting “shall” for “may,” a trial court was not required to advise a defendant of the election to submit to treatment even when it had reason to believe that he was an addict; rather the judge was only required to exercise his discretion in considering whether to offer the defendant drug treatment. (People v. Ruffin (1977), 46 Ill. App. 3d 448, 453-54, 361 N.E.2d 49; see People v. Kuesis (1981), 83 Ill. 2d 402, 407, 415 N.E.2d 323; People v. Warren (1977), 69 Ill. 2d 620, 626-28, 373 N.E.2d 10.) Public Act 81-851 removed this initial discretion from the trial court. Now when there is reason to believe an eligible defendant is an addict he must be advised of his option to elect treatment. (People v. Chaput (1981), 100 Ill. App. 3d 982, 984, 427 N.E.2d 595; People v. Davis (1981), 95 Ill. App. 3d 1097, 1098, 420 N.E.2d 1035.) Therefore, the key question becomes was there reason to believe that Banks was an addict.

Other reviewing courts have found that there was reason to believe a defendant was an addict even when the issue of treatment under the Dangerous Drug Abuse Act was not considered by the trial court. (People v. Chaput (1981), 100 Ill. App. 3d 982, 983-84; People v. Davis (1981), 95 Ill. App. 3d 1097, 1097-98.) Thus, we conclude that we have authority to review the facts to determine whether there was reason to believe that Banks was an addict, even though the trial court made no such determination.

Whether a court has reason to believe that an individual convicted of a crime is an addict must be determined from the facts presented in each particular case. (People v. Noascono (1980), 80 Ill. App. 3d 921, 926, 400 N.E.2d 720; People v. Miller (1976), 43 Ill. App. 3d 290, 292, 356 N.E.2d 1345; see Ill. Rev. Stat. 1979, ch. 91½, par. 120.3-3.) We note that a mere statement by an eligible defendant that he is an addict entitles him to an advisement of the probation and treatment possibilities under the Act, and believe that consistent with this statutory scheme little should be required to give a court reason to believe defendant is an addict. Here Banks testified under oath that he was 23 years old. WHiile in high school he used marijuana. He had used heroin, cocaine, and “tees and blues” with regularity until his incarceration. This testimony was sufficient to give the court reason to believe Banks was an addict, to require the court to inform him of his election rights under the Act, and to order his examination by the Department of Mental Health and Developmental Disabilities, if he so elected.

At the conclusion of Banks’ testimony, the court referred to a presentence investigation which said: “The defendant states he decided to quit drugs 2 years ago. He states he quit through ‘cold turkey’ and has abstained even from marijuana.”

The court denied Banks’ petition for treatment because it could be inferred from this statement that he was not an addict. We are of the opinion that the trial court erred in making such a finding. Section 10 of the Dangerous Drug Abuse Act, as of the time of Banks’ sentencing hearing, required that the expertise of the Department of Mental Health be employed in making that determination.

The State argues that the trial court was not required to consider the alternative provided by the Dangerous Drug Abuse Act because Banks was not eligible for probationary treatment under section 8 (Ill. Rev. Stat. 1979, ch. 91½, par. 120.8) because other criminal proceedings alleging commission of a felony were pending against him at the time of the hearing on his petition. The State’s argument is based upon a complaint then pending that alleged that Banks committed the offense of theft which was later stricken from the docket. According to the State, since the record on appeal shows that Banks had previously been twice convicted of theft, the theft charge pending against him alleged commission of a felony, because “[a] second or subsequent offense [of theft] after a conviction of any type of theft *** is a Class 4 felony.” (Ill. Rev. Stat. 1979, ch. 38, par. 16 — 1(e).) We find that the complaint here referred to was not sufficient to allege the commission of a felony. The complaint is specifically labelled “misdemeanor.” Further, section 111 — 2 of the Code of Criminal Procedure of 1963 (Ill. Rev. Stat. 1979, ch. 38, par. 111 — 2(a)) provides that “[a]ll prosecutions of felonies shall be by information or by indictment.” A complaint therefore could not charge defendant with the commission of a felony.

Secondly, the State contends that Banks was not eligible because he had been convicted of an unrelated burglary in 1977. The State relies on Public Act 81 — 851, which amended section 10 of the Dangerous Drug Abuse Act to superimpose the probation eligibility requirements of the Unified Code of Corrections. (People v. Cain (1982), 106 Ill. App. 3d 409, 410 — 11, 436 N.E.2d 32; People v. Andrews (1981), 95 Ill. App. 3d 595, 600, 420 N.E.2d 509.) Section 5-5-3(2)(F) of the Corrections Code (Ill. Rev. Stat. 1979, ch. 38, par. 1005 — 5—3(2)(F)) provides that “(2) A period of probation *** shall not be imposed for *** (F) A Class 2 or greater felony if the offender had been convicted of a Class 2 or greater felony within ten years of the date on which he committed the offense for which he is being sentenced.”

Burglary is a Class 2 felony. (Ill. Rev. Stat. 1979, ch. 38, par. 19 — 1(b).) Banks testified at his sentencing hearing that he was convicted of an unrelated burglary in 1977. If this is a fact, then he would have been ineligible for treatment under the Dangerous Drug Abuse Act, as amended by Public Act 81 — 851. We do not from this record find that he was so convicted. The trial court did not deny his petition on this basis. The presentence investigation report which is part of the record makes no reference to a prior burglary conviction. It does show he was charged with theft in 1977 and sentenced for that offense in February 1978. It is likely that Banks was referring to this theft conviction when he said he was convicted of burglary. The prosecution relied on his two prior convictions of theft as aggravating factors, but did not rely on a prior burglary conviction. Therefore, since the trial court did not find Banks ineligible because of this alleged burglary, we conclude that the proper solution is to remand this cause to determine whether there was a prior burglary conviction rendering Banks ineligible. If not, an examination should be ordered.

Accordingly, the convictions of defendants Beasley and Banks are affirmed. The sentence of Banks is vacated, and the cause is remanded for a new sentencing hearing for him.

Affirmed in part; vacated in part.

McNAMARA and RIZZI, JJ., concur.

       This section was amended by Public Act 81 — 1509, effective September 26, 1980, which substituted “a licensed program designated by the [Dangerous Drugs] Commission” for “the Department.”

       Banks argued that the complaint did not allege the commission of a felony because it was labelled “misdemeanor” and because the complaint did not allege prior convictions of theft or a theft over $150. In People v. Ramey (1974), 22 Ill. App. 3d 916, 317 N.E.2d 143, a defendant had been convicted a second time for theft, and the court held that the defendant should be resentenced as if there had been only one conviction. The court relied on the rule that a court may not impose an enhanced penalty for a successive conviction unless the prior conviction is alleged in the indictment and proved. (22 Ill. App. 3d 916, 921.) This rule was apparently eviscerated in the recent supreme court case of People v. Hayes (1981), 87 Ill. 2d 95, 429 N.E.2d 490. There the court stated:
      “We do not, however, find any sound reason to hold that because the prior "conviction elevates the degree of the offense from a misdemeanor to a felony it should be necessary, at the risk of prejudice to the accused, that it be alleged in the information and proved.” 87 Ill. 2d 95, 98.

       We note that if Banks had elected to be sentenced under section 10, as it read prior to Public Act 81 — 851, then the probation requirements of the Unified Code of Corrections would not have been applicable. (People v. Teschner (1980), 81 Ill. 2d 187, 194, 407 N.E.2d 49; People v. Andrews (1981), 95 Ill. App. 3d 595, 600, 420 N.E.2d 509.) Furthermore, we note that section 10 was amended by Public Act 82 — 519, effective January 1, 1982, and that that amendment deleted the reference in the second paragraph of that section to section 5 — 6—1(a) of the Unified Code of Corrections.


author: JUSTICE LORENZ

text:
    ROBERT R. ROTH, M.D., Plaintiff-Appellee, v. THE DEPARTMENT OF PUBLIC AID et al., Defendants-Appellants.
    First District (5th Division)
    No. 81—811
    Opinion filed September 17, 1982.
    Tyrone C. Fahner, Attorney General, of Springfield (Katherine M. Marshall and James C. O’Connell, Special Assistant Attorneys General, of counsel), for appellants.
    Albert Jenner, Jr., Jeffrey D. Colman, and Robert T. Markowski, all of Jenner & Block, of Chicago, for appellee.
   JUSTICE LORENZ

delivered the opinion of the court:

Defendant, Illinois Department of Public Aid (the Department), appeals from an order entered by the trial court upon administrative review, which reversed its determination that it was entitled to recoup $56,688.53 in payments made to plaintiff, Dr. Robert Roth, for medical services provided to Medicaid recipients.

The issues on appeal are: (1) whether retroactive application of the statutory power of recoupment would contravene due process; (2) whether the Department had a common law power to recoup such payments; (3) whether the Department’s record keeping standards at the time of the audit were unconstitutionally vague; (4) whether the Department’s finding that Dr. Roth failed to maintain adequate records was against the manifest weight of the evidence; and (5) whether the Department erred in granting recoupment where amounts claimed and evidence submitted are in dispute.

The pertinent facts follow.

On June 15, 1976, the Department notified Roth of its intention to recoup $96,703.41 in payments made to him for medical services rendered to Medicaid recipients. Roth voluntarily withdrew from the program and requested formal review of the proposed recoupment.

The Department initially listed three charges against him, (1) that he billed the Department for services he did not perform; (2) that he billed the Department more than once for the same service; and (3) that he failed to maintain proper records. At the beginning of formal hearings, however, the Department stipulated to the dismissal of the first and second charges, thereby basing its claim for recoupment solely on the ground that Roth failed to keep adequate records.

The Department justified its recoupment from Dr. Roth on the statutory powers conferred by the Public Aid Code (Ill. Rev. Stat., 1978 Supp., ch. 23, pars. 12 — 4.25, 12 — 4.26). The pertinent portions of 12 — 4.25 are as follows: “(A) The [Department] may deny, suspend, or terminate the eligibility of any person *** to participate as a vendor of goods or services to recipients under the medical assistance program *** [where] (c) Such vendor has failed to keep *** such records regarding payments claimed for providing services. *** (D) The [Department] may recover money improperly or erroneously paid, or overpayments, either by setoff, crediting against future billings or by requiring direct repayment to the [Department].”

Section 12 — 4.26 concerns the retroactive extent of section 12— 4.25 and provides that: “The [Department] may terminate or suspend a vendor pursuant to the authority and powers conferred in Section 12 — 4.25, only subsequent to the effective date of [the Act]. However the authority and powers are expressly declared to be retroactive to the extent that conduct and activities of vendors engaged in prior to the effective date of [the Act] may be relied upon as the basis for terminating or suspending eligibility to participate in the Medical Assistance Program, where the vendor had actual or constructive knowledge of the requirements which applied to his conduct or activities.”

Sections 12 — 4.25 and 12 — 4.26 became effective on December 1, 1977.

At the hearing, Paul Rogers testified for the Department that he was one of the two auditors who reviewed Roth’s records. The audit began in July 1975 and consisted of a review of approximately 25% of his records for the period from July 1973 through December 1974.

Rogers testified that the auditors compared the records maintained by Roth in the 25% sample to a computer printout of cases, called the vendor-patient profile or “VPP,” for which Roth had requested payments. From this review, the auditors compiled a list of cases in the sample which they believed justified recoupment.

Of these sample cases, Rogers requested that Roth produce the records for each patient on the sample list. Roth responded that prior to May 1974 he had kept his record of services rendered on a duplicate copy of the Department billing form, or DPA — 132.

The information contained on the DPA — 132 form included a patient’s name, address, case number, the diagnosis, a report of the services rendered, and the capacity in which the services were rendered, e.g., attending physician or surgical assistant.

Rogers testified that the auditors were, however, informed that the DPA — 132 was not a sufficient record and were instructed not to review Roth’s copies of those records. He further stated that the Department guidelines were “pretty liberal at that time and if there was anything written relevant to the patient it was accepted”; and that if the same information contained on a DPA — 132 form had been recorded on a separate piece of paper it probably would have been accepted.

Stephen Salpor, a department statistician, testified that according to his projections there was a 95% probability that the Department was entitled to recoup between $58,057.50 and $78,459.42 from Roth.

Dr. Roth testified that he primarily kept records by entering his diagnosis of a patient on a previously completed DPA — 132 form and keeping a duplicate of that record on file at a particular clinic, or by also recording on cards kept in folders at the clinic. This procedure was followed by every doctor working at the clinic.

He further testified that no one from the Department had ever indicated to him what records were required prior to the audit.

The hearing officer made her findings of fact and conclusions of law on October 10, 1978. She determined that the DPA — 132 form was not an adequate medical record and held that the Department was entitled to recoup $56,688.53 from Roth by projecting the total recoupment amount from the sample figures.

Dr. Roth subsequently filed his action for administrative review on January 9, 1979. The trial court entered an order on October 19, 1979, reversing the hearing officer’s decision based upon its conclusion that the Department lacked authority at the time of the agency hearings to use an administrative proceeding to recoup payments.

Opinion

Defendant first contends that the trial court erred in holding that section 12 — 4.25, which confers statutory authority to recover funds improperly paid, does not apply retroactively.

Citing Agustín v. Quern (7th Cir. 1979), 611 F.2d 206, which upheld the constitutionality of section 12 — 4.26, defendant argues that section 12 — 4.26 permits the retroactive exercise of the power of recoupment as a “necessary corollary” to the express powers of suspension and termination.

We do not agree.

As the supreme court stated in People ex rel. Manczak v. Carpentier (1954), 3 Ill. 2d 556, 558-59, 121 N.E.2d 762, “ ‘The question whether a statute operates retrospectively, or prospectively only, is one of legislative intent. In determining such intent, the courts have evolved a strict rule of construction against a retrospective operation, and indulge in the presumption that the legislature intended statutes, or amendments thereof, enacted by it to operate prospectively only, and not retroactively.’ ”

While we agree that section 12 — 4.26 expressly allows the powers of termination and suspension of vendors to operate retroactively, we find no suggestion in the 1977 act that it was intended to apply to the recovery of funds improperly paid before the act became effective. Where, as here, the language of a statute is unambiguous and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation and a court has no right to look for or impose another meaning. (Carnahan v. McKinley (1967), 80 Ill. App. 2d 318, 224 N.E.2d 297.) We further note that when a statute enumerates certain things, that enumeration implies the exclusion of all other things although there be no negative words of prohibition. In re Sneed (1977), 48 Ill. App. 3d 364, 363 N.E.2d 37, aff'd (1978), 72 Ill. 2d 326, 381 N.E.2d 272.

Accordingly, we conclude that the statutes do not authorize the Department to exercise its power of recoupment retroactively and we therefore do not consider whether such application would contravene due process.

Defendant next contends that the Department’s power to recoup is a common law power which can be exercised through an administrative hearing.

The precise question thus presented has not heretofore been considered by this court. However, a similar question was considered by the supreme court in Bio-Medical Laboratories, Inc. v. Trainor (1977), 68 Ill. 2d 540, 370 N.E.2d 223, prior to the enactment of sections 12 — 4.25 and 12 — 4.26.

There, the court held that the Department had no right to terminate or suspend a medical corporation’s right to participate in the Medicaid program absent an express legislative grant of authority under the Code. (Ill. Rev. Stat. 1975, ch. 23, par. 12 — 13.) The court reasoned that “inasmuch as an administrative agency is a creature of statute, any power or authority claimed by it must find its source within the provisions of the statute by which it is created.” 68 Ill. 2d 540, 551.

Subsequent to the Bio-Medical decision, which catalyzed the enactment of sections 12 — 4.25 and 12 — 4.26, the court in Agustin v. Quern (N.D. Ill. 1978), 461 F. Supp. 441, aff'd (7th Cir. 1979), 611 F.2d 206, while upholding the constitutionality of the limited retroactivity provided by the amendatory legislation, briefly touched upon the issue or procedural safeguards which has been raised in the case at bar.

There, the Agustín court stated that “[i]t is axiomatic that the elements of procedural due process include timely notice of governmental action and a meaningful opportunity to be heard. [Citation.] Whether such notice and hearing must precede a temporary deprivation as well as a permanent deprivation depends upon the balance of governmental and private interest affected. [Citation.] This same balance of affected governmental and private interests will determine what minimal procedural safeguards must attend the hearing provided. [Citation.]” 461 F. Supp. 441, 444.

In the absence of any Illinois authority to the contrary, and with the foregoing principles in mind, we conclude that the Department, if it retains a common-law right to recover misspent funds, may exercise that right only by maintaining a civil action in a court of competent jurisdiction. See, e.g., State of New Jersey, Department of Education v. Hufstedler (1981), 662 F.2d 208, 218 (appeal pending), where the court commented: “We note that such a rule assures that the parties to the audit are able to press their arguments concerning the merits of the audit in a judicial forum, either in the [Department] initiated proceedings or in an action seeking to have the [Department] remit withheld funds.”

In light of a physician’s economic interest in his status as a Medicaid vendor, and the overriding public interest in allowing only honest, competent physicians to treat Medicaid patients and be reimbursed by the State, we find that a balance is achieved by the institution of an appropriate action in a court of competent jurisdiction. Requiring less is simply inconsistent with our concept of fairness.

Accordingly, we conclude that the trial court properly held that the Department lacked common-law authority at the time of the agency hearings to use an administrative proceeding to recoup payments.

In light of our decision, we need not address the other issues raised by the Department in the case at bar.

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

Affirmed.

SULLIVAN, P. J., and WILSON, J., concur.