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Krueger & Ashe, Inc. v. Ende


DECEMBER 15, 1971.




APPEAL from the Circuit Court of Kane County; the Hon. JOHN S. PETERSEN, Judge, presiding.


The plaintiff appeals from an order of the circuit court of Kane County entered November 27, 1970, which dismissed their complaint on grounds of laches pursuant to a motion of the defendants. The record consists entirely of the pleadings, affidavits and exhibits submitted to the trial court.

The complaint, filed April 21, 1970, alleged that the parties entered into a written "offer to purchase" in August, 1964 whereby the plaintiff agreed to purchase a single family home in Carpentersville from the defendants for a price equal to the outstanding mortgage balance owed Percy Wilson Mortgage and Finance Corporation as of September 1, 1964. Although the offer was never reduced to a formal written contract, the plaintiff took possession of the property, collected rents, paid the mortgage, taxes and insurance and kept the property in good repair, all in reliance on the agreement with the defendants. Nonetheless, the complaint continues, the defendants refused to furnish a deed for the property as previously agreed and the plaintiff asked the court to order the defendants to deliver their deed, or, in the alternative, appoint a magistrate to execute and deliver a deed on their behalf. A hand written document captioned "offer to purchase" is attached to the complaint and appears as follows:

"Subject to the approval of our attorney, Richard C. McCarthy, as to matters of title and terms of a contract, hereafter to be drawn, I hereby offer to purchase the following described real estate:

One family dwelling located at 956 Berkely, Carpentersville, Ill. by assuming mortgage by Percy Wilson Mtge & Finance Corp. as of Sept. 1, 1964. The escrow account held by them to be assigned to Krueger & Asche, Inc. The fire insurance policy held by them to be assigned to Krueger & Asche, Inc.

The closing date to be September 1, 1964. I hereby tender $100.00 to be held by Seller as evidence of my good faith to be applied against purchase price."

The document was signed by the defendants and acknowledges receipt of the $100.00 and acceptance of the offer.

The defendants' motion to dismiss and supporting affidavit recites that prior to September 1, 1964, they leased the home to William Louis Brytung who has been in possession of it ever since and that the mortgage payments (including tax and insurance) were actually paid from the rentals received from him. The motion and affidavit also state that the sale to the plaintiff was not consummated on September 1, 1964, nor did the plaintiff or his attorney ever indicate approval of the "offer" or take any other affirmative action to complete the transaction until more than 5 years had elapsed.

Counter affidavits from both Richard Ashe and Donald Krueger were filed wherein they aver that Brytung was in actuality their tenant and that they had entered into leases with him, collected the rents and made all necessary payments on the property. They further stated that they had made frequent demands on the defendants for a deed.

Brytung, apparently a man of rare accommodation, furnished affidavits to both parties that does little to clear up the confusion. In his affidavit given to the plaintiff, Brytung states that Harry Ende first tried to sell the home but then leased it to him for two years under a written lease dated August 17, 1964. To his "best recollection", Brytung remembered that Ende then introduced Ashe to him as the new purchaser and directed him to make all future rent payments to the plaintiff.

In his second affidavit, Brytung said that he did not know either Ashe or Krueger prior to his leasing the property from Ende and that although Ende directed him to pay the rent to them he never offered an explanation of their relationship to the property. In any event, Brytung entered into a new lease in September, 1964 and regular renewals thereafter directly with Krueger and Ashe and made all rental payments to them until November, 1969 after which, at his attorney's direction, he made his payments to Percy Wilson. There is nothing to indicate that Ende was ever aware of any lease between Brytung and Krueger and Ashe.

Ende filed an additional affidavit wherein he denied that the plaintiffs made frequent requests for a deed as they had alleged and attached the following letter dated September 1, 1965 that he sent to Ashe.

"Mr. Richard Ashe Carpentersville-Dundee Agency 111 Oregon Avenue Dundee, Illinois

Re: 956 Berkley Carpentersville, Illinois

Dear Dick:

Relative to our many phone conversations concerning the formal closing of the sale of property mentioned above, it is imperative that we have the legal papers drawn up immediately.

I have just purchased another home and ran into difficulty with the F.H.A. due to the fact that Percy Wilson Mortgage and Finance Company is still holding me responsible for the property.

By a copy of this letter to Tharpe and Brooks in Atlanta, I am going on record that this property settlement shall be completed within a thirty day period.

You may send the necessary forms to my new home address, which is 1269 Blueberry Trail, Decatur, Georgia.

Thank you for expediting this, Dick, and with best regards, I am,

Yours very truly,

Harry G. Ende"

• 1 It is agreed that the doctrine of laches as followed in Illinois is best described in the case of Pyle v. Ferrell 12 Ill.2d 547. In the Pyle case, the plaintiff sought to quiet title to a mineral estate of 80 acres and remove as clouds upon his title a tax deed and certain leases made by the holder thereof. Pyle acquired title to the mineral estate by devise from his father in 1932. At that time Pyle resided in California but returned to Illinois in 1946. Pyle made no effort to visit the property or pay the taxes or determine their status until 1954 when he was contacted by a geologist. In the meantime, the mineral estate was sold in 1936 to Ferrell for delinquent taxes of 1935. Ferrell received a tax deed in 1938, when no redemption was effected, and made all subsequent tax payments and subsequently leased the property to third parties. Although Pyle attacked the validity of the tax deed on technical grounds, the court dismissed his complaint for reason of laches and was upheld by the Supreme Court. That court defined the doctrine as follows p. 552:

"Laches, or the doctrine of stale demand, as it is sometimes termed, is a defense peculiar to equity which is bottomed on the reluctance to aid one who has knowingly slept on his rights and acquiesced for a great length of time, and its existence depends on whether, under all circumstances of a particular case, a plaintiff is chargeable with want of due diligence in failing to institute proceedings before he did."

The court goes on to say that the facts necessary to constitute laches must be determined in each case but quotes Section 498 of 19 Am. Jur. (Equity) to the effect that laches will bar a stale demand only where the following facts are disclosed p. 553: "(1) Conduct on the part of the defendant giving rise to the situation of which complaint is made and for which the complainant seeks a remedy; (2) delay in asserting the complainant's rights, the complainant having had notice or knowledge of defendant's conduct and the opportunity to institute a suit: (3) lack of knowledge or notice on the part of the defendant that the complainant would assert the right on which he bases his suit, and (4) injury or prejudice to the defendant in the event relief is accorded to the complainant or the suit is held not to be barred."

The plaintiff agrees that the first two factual requirements enumerated in the Pyle case are present here. Although the plaintiff argues otherwise, the record supports the contention of the defendants that they had no notice that the plaintiff intended to assert their rights until a lapse of 5 years after the agreed "closing".

• 2 It would thus appear that the crucial issue is whether the defendants suffered injury or prejudice by reason of the unquestioned lack of diligence on the part of the plaintiff. The plaintiff asserts that the position of the defendants was completely unaffected by the delay since the only benefit to be accrued by them had the closing been held in accordance with the agreement was relief from the obligation to pay Percy Wilson and that, in fact, they were relieved of that obligation anyway. Although the "offer to purchase", among other numerous shortcomings, fails to state if the defendants were to be released of liability on their mortgage commitment to Percy Wilson at the time of "closing", it is obvious that their exposure to liability on the obligation would have been substantially reduced had the plaintiffs executed a formal assumption agreement. Indeed, the letter of September 1, 1965 from Ende to Ashe indicates a good example of injury to his interests, i.e. "* * * difficulty with the F.H.A. due to the fact that Percy Wilson Mortgage and Finance Company is still holding me responsible for the property."

In addition to their mortgage obligations, the defendants also had the usual responsibilities of land ownership (with no benefits) until the sale was completed. Although it does not appear that any of those responsibilities actually ripened into financial loss, their exposure to them was itself prejudicial to their interests. The plaintiff, on the other hand, had no responsibility at all during their long, unexplained torpor and yet could claim the benefit of any accretion in land value by completing the purchase.

• 3, 4 The applicability of the doctrine of laches to any particular factual situation is left to the sound discretion of the trial court and will not be disturbed unless "* * * the determination of the court is so clearly wrong as to constitute an abuse of discretion." People ex rel. Cronin v. Cahill 118 Ill. App.2d 18, 254 N.E.2d 161, 165; Johnson v. Central Standard Life Insurance Co., 102 Ill. App.2d 15, 32, 243 N.E.2d 371, 385.

We do not find that the trial judge abused his discretion in this matter and accordingly affirm his order of dismissal.

Judgment affirmed.

SEIDENFELD and GUILD, JJ., concur.


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