APPEAL from the Circuit Court of Cook County; the Hon. CHARLES
R. BARRETT, Judge, presiding.
MR. JUSTICE SULLIVAN DELIVERED THE OPINION OF THE COURT:
Rehearing denied November 2, 1973.
Plaintiff filed a complaint against 10-Dix Building Corporation (hereinafter called 10-Dix) and Gene Farina, its sole shareholder, seeking: (1) an equal division of 10-Dix corporate stock pursuant to an alleged agreement between him and Farina; (2) an accounting of the profits of 10-Dix; (3) an equal division of the shares of stock held by Farina in the Farbeck Corporation (hereinafter called Farbeck); and (4) participation in the purchase by Farina of the interest of a co-participant, Louis Beckman.
The trial court found in favor of plaintiff and on appeal defendants contend that the court erred: (1) in finding the existence of the contract between plaintiff and Farina; (2) in ordering one third of the capital stock of 10-Dix to be transferred by Farina to plaintiff upon payment by plaintiff of $333.33 (one half of the amount paid by Farina on the issuance of the capital stock); and (3) in requiring Farina to give an accounting of all transactions of 10-Dix.
Plaintiff cross-appeals contending the court erred: (1) because he was not given the right to participate in the purchase by Farina of the interest of Louis Beckman, another participant; and (2) because the decree fails to specifically provide for an accounting of the transfer without consideration of a lease purchase contract from 10-Dix to Farbeck.
Some time prior to April, 1964, Jewel Tea Company acquired a shopping center known as Wallacetown and its adjacent land in Chicago Heights, Illinois. In furtherance of a plan to develop the center, Jewel sought the assistance of Louis Beckman, a Kankakee real estate developer and investor, who, concurrently, operated in an agency capacity for Allen Bros. and O'Hara, a Tennessee general contractor and developer. Subsequently, on May 2, 1964, a meeting was held in Beckman's office in Kankakee, Illinois at which were present, in addition to Beckman, plaintiff, Farina and two associates of Beckman, Joel Brault and Bill Thompson. Because this meeting is particularly significant, the testimony of the persons present is set forth as follows:
Plaintiff testified that Beckman had called him concerning a building project in Chicago Heights and plaintiff asked Farina to accompany him to a meeting with Beckman in Kankakee; that Beckman had explained he intended to purchase some of the Jewel Tea Company land to erect an office building; that Beckman said the project would involve an expenditure of about $500,000 and that the sharing would be 50% by Beckman and 25% each for plaintiff and Farina; that both he and Farina said they were interested; that Beckman said the "front money" would be $50,000 to $100,000 and plaintiff said he would put up his share; that while he and Farina were driving back to Chicago Heights it was decided that Farina would follow through on the details and that plaintiff would take care of the legal matters.
Farina testified he was asked by plaintiff on May 2, 1964, to ride with him to Kankakee and that while driving there plaintiff discussed his interest in starting a savings and loan in Chicago Heights; that at the meeting Beckman talked about developing a savings and loan and an office building in Chicago Heights; that Beckman said the total cost of an office building would be about $600,000 with front money of about $115,000 to $130,000; that Farina said the site was good and that he would think it over; that on the drive back plaintiff again discussed the savings and loan project.
Beckman testified that he had known plaintiff, having served with him in the State legislature, and that he telephoned him in February or March of 1964 concerning the possibility of an additional development in the Wallacetown shopping center; that they may have discussed a savings and loan in this initial telephone contact; that on May 2, 1964, a meeting was held in his office with the plaintiff, Farina and two of Beckman's associates at which time he explained the possibility of the purchase of land from Jewel Tea Company; that no format for any building was offered by him; that no specifics were discussed at this meeting as to anyone having a particular interest or participation; that the question of participation was left open; that at this meeting he gave some details concerning the possibility of obtaining a ground lease and some details of the requirements, including financial, involved in the development of the building project; that he did not believe the figure of $500,000 was mentioned but that he did suggest the need of "front money" of about $100,000.
Brault testified that he attended the May 2, 1964 meeting for only a short time and that all he remembered was that those present agreed that it was a good idea to look into a building project in Chicago Heights.
Beckman testified that there was a second meeting about one month later in Farina's office at which plaintiff was present. At this second meeting, Beckman testified he expressed his interest in going ahead with the building project and again informed plaintiff and defendant the door was left open for local participation. He also testified that at no time was he present during any discussions concerning specific participation by the plaintiff and that after this second meeting all subsequent meetings were with Farina.
Eventually, an express agreement was entered into between Farina and the Beckman group (Beckman and two of his associates), wherein Farina was to have a two-thirds interest and Beckman's group a one-third interest in the proposed building. Furthermore, the parties, Farina and the Beckman group, decided to utilize the corporate form as the business vehicle for the venture.
Plaintiff testified that shortly before the incorporation of 10-Dix he indicated to Farina his desire to keep his "participation" in the project secret and, to that end, Farina was to hold one-half of the shares of stock issued in Farina's name in trust for plaintiff. Farina denied any such discussion or understanding.
On September 21, 1964, Beckman's attorneys incorporated the venture into the 10-Dix Building Corporation and issued capital stock in accordance with the Farina-Beckman agreement; 666 shares to Farina and 333 shares to the Beckman group. *fn1 Prior to the incorporation meeting with Beckman's attorneys, Farina had consulted plaintiff in the latter's capacity as an attorney to ascertain whether or not there could be equal voting power in 10-Dix between himself and the Beckman group even though the Beckman group had only a one-third interest. Plaintiff referred the matter to one of his associates and subsequently, on three separate occasions, plaintiff's law firm billed Farina for the work done in response to that request. In November, 1964, plaintiff, Farina and a a member of the Beckman group attended a meeting in the office of Beckman's ...