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Davis v. Nehf

AUGUST 20, 1973.




APPEAL from the Circuit Court of Cook County; the Hon. JAMES E. STRUNCK, Judge, presiding.


The plaintiff, a licensed New York real estate broker, sued the defendant in New York for the payment of an alleged brokerage commission. The defendant was served with summons in Chicago, Illinois, pursuant to section 302 of the Civil Practice Laws and Rules of the State of New York. (7B McKinney's CPLR, sec. 302, 1972.) The defendant filed no appearance in New York, and judgment was entered in favor of the plaintiff. The plaintiff then filed a petition to register that judgment in the circuit court of Cook County. The defendant answered that the New York judgment was void for lack of jurisdiction and counterclaimed that he had relied on false representations of the plaintiff and suffered damages for lost rentals and costs of improvements. The plaintiff then filed Count II of the complaint, which is virtually identical with the complaint filed in New York. The trial judge denied the defendant's motion for summary judgment; granted summary judgment for the plaintiff on the petition to register the foreign judgment; and dismissed the counterclaim. The defendant appeals from all three orders.

In addition to the pleadings, the record consists of the affidavits of the plaintiff and the defendant. The defendant, Sol Nehf, under the terms of a 99-year lease, is the owner of a leasehold improved with a 16-story commercial and office building located at 173 West Madison Street, Chicago, Illinois, known as the Madison-LaSalle Building. The defendant is, and at all times was, a resident of Chicago and maintains his sole office and place of business at 173 West Madison. He never had a place of business in New York and had not been in New York for over five years. The plaintiff, Richard Davis, was engaged in the business of a real estate broker and has been licensed by the State of New York since 1966. His business is located in New York, and he represented clients on a commission basis. The only contact that the parties had with each other was by telephone and mail correspondence dealing with the rental of space in the building at 173 West Madison in Chicago.

On or about November 22, 1966, the plaintiff from New York contacted the defendant in Chicago by telephone and advised the defendant that he had a prospective tenant who wanted to rent office space in the defendant's building and asked if any space was available. The defendant told him that there was, and the plaintiff submitted as a prospective tenant the name of Programming & Systems, Inc., a corporation which had decided to open various franchises and subsidiaries throughout the United States. According to the defendant, the plaintiff told the defendant that the prospective tenant had a very good credit rating, was financially sound and fully capable of carrying out any commitment made by way of a lease. The plaintiff denied making a representation of the financial condition of the tenant.

Thereafter, considerable correspondence took place between the two parties; the plaintiff telephoned the defendant from New York, and the defendant telephoned the plaintiff from Chicago concerning what progress was being made in the renting of the building space. The plaintiff in New York was asked by the defendant by telephone to complete arrangements with Programming & Systems, Inc. for the leasing of office space. The parties entered into an agreement under which the plaintiff was to be the defendant's broker for the leasing of the building space and compensated at the prevailing brokerage rate.

The plaintiff entered into negotiations, all of which took place in New York, with Programming & Systems, Inc. These negotiations occurred during a period of several weeks and the plaintiff incurred expenses for which he was to be compensated by the defendant.

On December 2, 1966, the defendant advised the plaintiff that he had met with the principals of the prospective tenant in Chicago and that they were discussing a six-year lease. The prospective tenant requested the defendant to improve the premises for its own particular use. The defendant hesitated because there was no signed lease; the plaintiff, however, then asserted that the prospective tenant would enter into the lease and that it was safe to proceed with the alterations and remodeling, which the defendant did.

On January 4, 1967, the defendant prepared a lease wherein Programming & Systems, Inc. was the tenant and forwarded it to New York. Two or three days later the defendant received a call from the plaintiff, who told him that Programming & Systems, Inc. would not be the tenant for the premises but that another corporation, Programming & Systems Institute of Chicago, Inc., a subsidiary of the corporation originally proposed as a tenant, would be the lessee. The plaintiff told the defendant that Programming & Systems Institute of Chicago, Inc. was a financially sound corporation and would be able to carry out any commitment.

A lease was executed by Programming & Systems Institute of Chicago, Inc., as lessee, and the defendant as lessor, for the period of February 15, 1967, through February 15, 1973, at a total rental of $78,280.00 payable at $970.00 per month for the first 12 months and thereafter at $1110.67 per month for 60 months. The first rental payment was made on May 5, 1967, when the premises were completed. The tenant paid rentals for the months of June and July of 1967 but failed to pay rent for the months of August through December. The defendant then executed a new lease with Programming & Systems Institute of Chicago, Inc. for the period of January 1, 1968, through December 31, 1968, at a total rental of $11,640.00 payable in 12 equal monthly installments of $970.00. This one-year lease was fully performed. In January of 1969, the defendant executed another lease, which is presently in effect, with the same tenant for the period commencing January 1, 1969, and expiring December 31, 1975. This lease was for a total rental of $89,920.20 payable in 24 consecutive monthly installments of $970.00 and thereafter in 60 monthly installments of $1110.67.

On January 20, 1967, the plaintiff billed the defendant $2221.80 for his services based on the standard real estate brokerage rates then prevailing. The defendant paid $500.00 but refused to pay the balance of the fee.

• 1 The plaintiff contends that the defendant's motion for summary judgment was properly denied since the supporting affidavit was improper in that it sets out matters to which the affiant could not testify. (Ill. Rev. Stat. 1971, ch. 110A, sec. 191.) The record reveals that plaintiff's motion to strike the affidavit was not considered nor ruled upon by the trial court in relation to its legal sufficiency. Since it is the duty of the movant to bring such motions to the attention of the trial court and to preserve any rulings thereon, the failure to do so waives any objection. (Jones v. Lukas, 122 Ill. App.2d 162, 164, 258 N.E.2d 147.) In any event, we have considered the affidavit and hold that it sufficiently complies with Supreme Court Rule 191.

• 2 The plaintiff first argues that, since the defendant did not challenge the jurisdiction of the New York court, Illinois courts are bound under the full faith and credit clause of the Federal Constitution to enforce the judgment. We must, of course, reject this argument. The courts of Illinois may inquire into the proceedings of a court of a sister state to determine whether such court had jurisdiction of the subject matter or the parties so as to bring the judgment within the full faith and credit clause. (ILP Judgments, sec. 554; Faris v. Faris, 35 Ill.2d 305, 220 N.E.2d 210; People v. Western Tire Auto Stores, Inc., 32 Ill.2d 527, 207 N.E.2d 474.) The Uniform Foreign Money-Judgments Recognition Act (Ill. Rev. Stat. 1971, ch. 77, sec. 121, et seq.) provides in section 123 that a "foreign judgment is enforceable in the same manner as the judgment of a sister state which is entitled to full faith and credit"; but section 124(a) (2) provides that a foreign judgment is not conclusive if the foreign court did not have personal jurisdiction over the defendant. Kolman v. National Racing Affiliates, Inc., 64 Ill. App.2d 61, 64, 212 N.E.2d 313, involved, as here, a suit in Illinois based on a foreign judgment. The court said:

"Under well-established rules for according full faith and credit to the judgments of sister states, the forum court may not rehear the case on its merits as it is res judicata as to the nature and amount of the plaintiff's claim and all defenses raised or which could have been presented. [Citation.] A foreign judgment has no constitutional claim to full faith and credit, however, where the error complained of to the forum court is one which would (1) render the judgment void according to the law of the foreign state, or (2) deprive the foreign court of jurisdiction over the contesting party according to general constitutional principles of due process."

• 3 The question is whether New York had in personam jurisdiction over the defendant. In 1945, the United States Supreme Court decided International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 316, 90 L.Ed. 95, holding: "* * * [D]ue process requires only that in order to subject the defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" Subsequent to the International Shoe case, a number of states passed so-called "long-arm" statutes dealing with the problem of ...

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