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Schiro v. W.e. Gould & Co.





APPEAL from the Superior Court of Cook County; the Hon. JOHN A. SBARBARO, Judge, presiding.


Rehearing denied March 28, 1960.

This is a direct appeal from a decree of the superior court of Cook County dismissing a suit for specific performance of a written contract to purchase certain real property, instituted by the purchaser, Frank Schiro, against the vendors, W.E. Gould & Company, and Joseph Goth and his wife. The issue in this cause is whether the trial court erred in sustaining defendant's motion to dismiss the complaint for specific performance of the real estate contract under the circumstances involved herein.

According to the uncontroverted facts, on December 18, 1948, Anthony Coniglio and Joseph Coniglio, and plaintiff Frank Schiro executed certain "Articles of Agreement for Warranty Deed" with defendants, W.E. Gould & Company and Joseph Goth. The contract provided, in substance, that if purchasers made certain payments as provided therein defendants would convey to the purchasers, in fee simple, clear of all encumbrances, by a warranty deed, the premises known as 8221 W. Irving Park Road, Chicago, Illinois. Under the contract, the purchasers agreed to pay defendants the principal sum of $18,050, consisting of the purchase price of $16,700, plus extras of $1,350. This sum was payable as follows: $4,000 at the time of signing the contract, $3,500 "when building completed and ready for occupancy," $8,000 by the assumption of first mortgage to Alliance Life Insurance Co. of Peoria, and the balance payable in the amount of $125 or more per month beginning February 1, 1949, which sum included the payment of $84.88 per month and the interest due on the first mortgage to the Alliance Insurance Co. The contract further provided that the purchasers pay all taxes, assessments or impositions that may be levied on the land subsequent to 1948, and upon their failure to make any of the payments or perform any of their covenants, the contract shall, at the option of the sellers, be forfeited, and the purchasers forfeit all payments, which may be retained by the sellers as liquidated damages.

On September 15, 1950, Joseph Coniglio and his wife conveyed all of their interest to Anthony Coniglio, and the latter and his wife conveyed all of their interest to plaintiff on September 21, 1950. Plaintiff alleges, and defendants do not deny, that defendants thereafter proceeded to build upon the premises, apparently in accordance with the contract, and that plaintiff made his payments in accordance with the terms of the contract, until the amount owing on the contract was only $695.08.

In January, 1955, plaintiff offered to pay the remainder due on the contract and requested a deed to the premises. Plaintiff, however, refused the deed offered by defendants, which reserved the use of the water mains and water meter located on plaintiff's property for the benefit of lot 7, owned by defendants. It was then discovered that defendants did not construct a sewer solely for the use of plaintiff's premises, as required by the City Code of Chicago, but had constructed a system whereby the sewerage from plaintiff's property drained into the sewer on the adjoining lot 7; that the catch basin on plaintiff's property was used by the adjoining lot 7, contrary to the requirements of the code; and that defendants did not connect the water pipes on plaintiff's premises directly with the city water system, as required by the code, but rather connected them through the system installed on the adjoining lot 7.

Defendants refused plaintiff's request to install a water and sewerage system in conformity with the city code, since the cost of such work was approximately $3,000. Defendants also refused plaintiff's offer to pay the balance due on the contract and secure a deed with an abatement of the purchase price to remedy these construction defects.

Plaintiff thereupon instituted suit in February, 1956, for specific performance of the written contract, alleging the foregoing facts, and attaching a copy of the contract to the complaint. Plaintiff tendered the amount due under the contract and requested that defendants be ordered by the court to make the necessary alterations, or upon defendants' failure to do so within a date to be fixed by the decree, plaintiff be authorized to make such repairs and deduct them from the balance of the purchase price and have judgment for any sums in excess of the amount due the defendants.

Defendants moved to strike the amended complaint, alleging that it failed to state a cause of action against any of them, inasmuch as the articles of agreement attached to the complaint contained no provisions that defendants construct a sewer directly connected with the city system, nor any provision that a septic tank would be built upon the premises for the exclusive use of plaintiff's building, nor even any provision that defendant would construct any building or septic tank or sewer system upon the premises. Defendants, therefore, asserted that they had no obligation to relocate the drains, or water pipes, or septic tank or sewer system; and, furthermore, that a court of equity would not require specific performance of a contract to make alterations or repairs.

The superior court of Cook County sustained defendants' motion to strike plaintiff's amended complaint, and dismissed the suit. From this order plaintiff has directly appealed to this court. Inasmuch as a suit for specific performance of a real-estate contract involves a freehold (Laegeler v. Bartlett, 10 Ill.2d 478, 480), this court has proper jurisdiction to review the order of the superior court on a direct appeal.

In support of the legal sufficiency of the complaint, plaintiff relies upon the principle that specific performance of a contract for the sale of real estate will be ordered, at the election of the purchaser, even though the vendor may be unable to convey all of the property included in the contract, with an abatement of the purchase price for slight defects in quantity and quality of the estate. Baker v. Puffer, 299 Ill. 486, 490; Gravelot v. Skender, 9 Ill.2d 15, 20; Mitchell v. White, 295 Ill. 135.

Defendants have no quarrel with this settled principle, but argue that it has no application in the instant case. They contend that under the terms of the contract sued upon they undertook no construction of any building or sewer system, and that since they can give the warranty title contracted for, there are no grounds for any abatement in the purchase price or specific performance of any alterations in the construction.

It is therefore incumbent upon this court to examine and construe the controverted contract. It is axiomatic that contracts must be construed to give effect to the intention of the parties as expressed in the agreement, and to this end the contract should be construed as a whole, giving effect to every portion of the instrument and preferring that construction which renders the agreement legal rather than void. 91 C.J.S. 968.

While the contract attached to the amended complaint herein does not set forth in specific terms an undertaking by defendants to construct a building according to certain specifications, nevertheless it does contain certain references which indicate that the parties contemplated the sale and purchase of a building to be constructed by defendants. This is evident from the provision designating that the $18,050 due defendants under the contract consisted of a purchase price of $16,700, and $1,350 as "extras," and from the provision specifying that $3,500 would be due "when building completed and ready for occupancy." The use of the word "extras" in connection with the contract price of the real estate may reasonably be deemed to refer to additional construction features, particularly when construed with the clause referring to the building being completed. Moreover, the fact that a substantial part of the contract price to be paid to defendants for the property is conditioned upon the building being completed and ready for occupancy, indicates that the parties contracted for the sale and purchase of a building to be constructed by defendants, rather than for vacant real estate. Furthermore, defendants at no time deny that this was the intention of the parties ...

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