Appeal from the Municipal Court of Chicago; the Hon. THOMAS H.
FITZGERALD, Judge, presiding. Reversed as to count one, and cause
MR. PRESIDING JUSTICE MCCORMICK DELIVERED THE OPINION OF THE COURT.
Rehearing denied July 19, 1961.
A suit in contract was filed by Calo, Inc., an Illinois corporation, also known as Calo Bowl, Chicago National Bank, not individually, but as Trustee under Trust No. 13953, and Albert Sakolsky. The action was filed in the Municipal Court of Chicago. The defendants made a motion to strike plaintiffs' third amended complaint and dismiss the proceedings. After a hearing the court sustained the motion and dismissed the proceedings. This appeal is taken from that judgment order by Calo, Inc., an Illinois corporation, also known as Calo Bowl (hereafter referred to as Calo). The other plaintiffs are not appealing.
Calo's theory is that the contract was made up of various writings, and that it was effective to bind the defendants, even though it was not signed, since it had been acted on.
The defendants contend that the written offer submitted by Calo was not accepted either in accordance with its provisions or by any act or acts on the part of the defendants which would constitute even a partial performance or acceptance of Calo's proposal; that no written contract was entered into between the parties, and if a verbal agreement had been reached it would have been within the prohibitions of the pertinent provisions of the statute of frauds; and that hence plaintiffs' third amended statement of claim fails to state a cause of action.
The third amended statement of claim of the plaintiffs contains two counts. Count two was filed on behalf of Albert H. Sakolsky. He takes no appeal and consequently we are here not concerned with that count. In count one the statement of claim alleges that the plaintiffs had leased certain premises formerly used as a public theater and that under the terms of the lease the premises were being remodeled for use by Calo as a bowling alley and cocktail lounge; that by the terms of the lease Calo, as lessee, and the lessor were required respectively to do certain things in the remodeling; and that no rentals would accrue to the lessor until the completion of the remodeling and the business of Calo had begun. The statement of claim further alleges that on November 26, 1958 the defendants prepared and presented to Calo an offer to be made by Calo to the defendants for the purchase of certain items of equipment and the rental of other items of equipment by Calo from the defendants for installation and use in said premises. This offer is attached to the statement of claim as exhibit B. The statement of claim further alleges that concurrently with the offer the defendants "delivered their acknowledgment and acceptance thereof," and the alleged acceptance is attached to the statement of claim as exhibit C. The statement of claim also alleges that when Calo informed the defendants that the permits and licenses were available the defendants requested, and Calo paid to the defendants, the further sum of $5,000, which payment was accepted by the defendants; that the defendants thereupon prepared and delivered to Calo plans and specifications for the purpose of having the premises so remodeled as to fit them specifically for the installation of the equipment in question and represented to Calo that the installation would be completed by defendants in time to permit Calo to solicit and accept 1959 summer bowling league business; and that the remodeling in the premises according to the plans and specifications was done under the direction and supervision of the defendants. The statement of claim also alleges that Calo relied upon the representations of the defendants and caused advertising to be published with regard to the bowling alley; that on January 7, 1959 the defendants by letter advised Calo that the defendants "could not accept" the offer to purchase and rent the equipment, and the letter is attached to the statement of claim as exhibit E. Count one of the statement of claim further alleges damages on the part of Calo and prays for judgment.
The defendants filed a motion to strike, which, among other things, alleged that the purchase order, or offer, of Calo to the defendants was not signed by the defendants though by its terms it was required to be signed by the defendants before it became an effective contract; that the allegation of Calo in paragraph six of its statement of claim that the defendant had accepted the offer as shown in exhibit C is not borne out by the exhibit; that when Calo in paragraph seven of its statement of claim alleges that it informed the defendant that it had received all necessary permits and licenses and that it was then ready to proceed with its offer, such allegation is immaterial since there is no allegation that the defendants accepted the offer; that Calo's allegation that it paid the defendants a further sum of $5,000 at the defendants' request was immaterial since by the terms of the offer the payment of the sum of $5,000 was an additional deposit and could become effective only if the defendants accepted the offer, and the offer so provided; that paragraph nine of the statement of claim in which Calo alleges that the defendants caused to be prepared and delivered to it plans and specifications for the purpose of having the premises remodeled is false in that exhibit D, which consists of the "plans," was merely a plan or sketch showing how the bowling lanes were to be installed in the space and area which they would require; that under the terms of the offer the delivery of such sketch was conditionally made subject to the acceptance of the offer; that since there was no written agreement the alleged agreement falls within the prohibition of the statute of frauds; and that under the terms of paragraph twelve of the statement of claim the deposits made by Calo were refunded by the defendants and accepted by Calo.
The offer made by Calo to the defendants is entitled "Purchase Order," and states that Calo "does hereby order and, upon Seller's acceptance, agrees to purchase the equipment described below. . . ." It further provides that the purchase price is $42,629.04 with an installation charge of $5,000, which, together with taxes and insurance charges, made a total price of $49,122.91, "which contract price purchaser agrees to pay Seller or Seller's assigns as follows:
Down payment on Contract Price ........................ $3,122.91
Other Cash Payments Due upon notice from seller approximately 90 days before shipment ...................... 5,000.00
Due upon notice from seller approximately 30 days before shipment ...................... 5,000.00
Total Prepayments on Contract Price .. $13,122.91."
It further provides that the balance shall be evidenced by a note signed by the purchaser and secured by a chattel mortgage, and shall be payable in 32 equal instalments beginning in 1959. On the reverse side of the order it is stated: "Said Order is Subject to the Following Conditions." These conditions, among other things, provided: "Acceptance of this order by Seller at Seller's office in New York or Chicago shall be necessary to constitute a contract. . . . The receipt and retention of cash advances received with or in connection with this order shall not be considered as an acceptance of it but only as a deposit on account in the event that the order is accepted in whole or in part." The purchase order had written on it "Calo Bowl" and the signatures of Herbert H. Miller, president, and Ruth Miller, secretary.
A letter of the same date, exhibit C attached to the statement of claim, was addressed to Mr. H.H. Miller and stated that the defendants agree to return the full deposit of $2,556.77 "in case you are not able to obtain complete permits, liquor license and other agreements to fulfill your bowling project." (No explanation is given accounting for the difference between the amount of the deposit stated in the purchase order and the amount stated in the letter to be the full deposit.) The letter further stated that the agreement applies to the installation of ten AMF DeLuxe Lanes scheduled to be installed approximately February 1, 1959 in the Calo Theatre, and the letter further states that it "is a receipt for the $2556.77 received as a deposit on the purchase order JEL-543 from Herbert H. Miller." The letter is signed by the defendants' equipment sales engineer. This letter becomes a part of Calo's offer and is not in any sense an acceptance of the offer as is alleged in the sixth paragraph of the statement of claim.
[1-6] It is elementary law that in order for a contract to come into being there must be mutual assent of all of the parties thereto. Contracts are ordinarily made by an offer and acceptance. "An offer is an expression by one party of his assent to certain definite terms, provided that the other party involved in the bargaining transaction will likewise express his assent to the identically same terms. An offer looks forward to an agreement to mutual expression of assent." Corbin on Contracts, sec. 11. An offer is always a conditional promise and it may become a contract. Williston on Contracts, 3rd ed., sec. 25. If no specific time limit is fixed with reference to the offer it continues for a reasonable time. If no specific mode of acceptance is specifically fixed in the offer, the acceptance need not be in any particular form nor evidenced by express words. Where the parties make the reduction of the agreement to writing and its signature by them a condition precedent to its completion, it will not be a contract until this is done. Hausman Steel Co. v. N.P. Severin Co., 316 Ill. App. 585, 589, 45 ...