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Nardi & Co., Inc. v. Allabastro

MAY 28, 1974.




APPEAL from the Circuit Court of Cook County; the Hon. JAMES A. GEROULIS, Judge, presiding.


Nardi & Co., Inc., an Illinois corporation, filed a suit against Robert A. Allabastro; and in an amended complaint, it alleged the breach of an express written contract to pay a $40,000 real estate brokerage commission. Defendant appeared and denied plaintiff's material allegations. Thereafter, without a jury, the trial court heard evidence and found that plaintiff was entitled to recover $25,000 in damages from the defendant. The sole issue in this appeal is whether in this action ex contractu the trial court could enter a judgment quantum meruit in favor of the plaintiff.


Early in 1965, Robert A. Allabastro, a real estate broker who specialized in acquiring vacant real estate for industrial development, purchased from three separate farm families options to buy 200 acres of contiguous farmland in Du Page County, Illinois. Allabastro planned to have the land rezoned and then sell it at $10,000 per acre for development of an industrial park. As is common in such ventures, Allabastro encountered problems; and as a result, he met Robert K. Bley, a licensed real estate broker then employed by Nardi & Podolsky, an Illinois licensed real estate brokerage corporation that dealt primarily in the development of industrial sites. Nardi & Podolsky was the predecessor corporation to the plaintiff in this case, Nardi & Company, Inc.

After several meetings and conversations, Allabastro agreed with Bley that Nardi & Podolsky could be his exclusive agent to sell the 200 acres. Accordingly, on March 7, 1968, the agreement was signed; and under its terms, several prospective purchasers (not including Winthrop Lawrence, Inc.) were submitted to Allabastro, one of which made an offer to purchase the 200-acre parcel, treating it as having a net acreage of 170 acres. This feature of the offer made it unacceptable to Allabastro. Therefore, he contacted William Klebold, a District of Columbia mortgage broker, and through him began negotiations for sale of the land to Winthrop Lawrence, Inc. In discussing what should be the commission, Allabastro expressed to Klebold the willingness to pay $100,000 if he got his price: $2,000,000. Thereafter, negotiations with Winthrop Lawrence continued and culminated with an agreement that if adequate financing could be obtained, it would purchase the 200 acres for $2,000,000. It was Winthrop Lawrence's plan to resell the land in smaller parcels to companies in need of industrial sites.

After the Winthrop Lawrence agreement was formalized, Bley and Milton Podolsky, a partner, stockholder and employee of Nardi & Podolsky, worked to obtain the required financing. Through their efforts, Equitable Life Assurance Society of America agreed that if Winthrop Lawrence had the services of a real estate broker experienced in the sale of industrial sites, it would make a mortgage commitment. Nardi & Podolsky was qualified to meet this requirement of the mortgage lender. The firm agreed to handle the contemplated parceling and resale of the 200 acres. As a consequence, Equitable made the mortgage commitment.

On August 28, 1968, Allabastro and Bley, in the presence of business associates, met to discuss the impending sale of the land to Winthrop Lawrence and the compensation for Bley and the firm that employed him. Allabastro agreed that Bley had been of considerable assistance in obtaining the mortgage and in activities related to the potential sale. In the course of the discussion, Allabastro pointed to the contemplated resales of the land by Winthrop Lawrence, resales which he thought would produce as much as $500,000 in real estate brokerage commissions. As a result, it was agreed that Bley and Nardi & Podolsky were to be paid a sum certain, in the event of a sale; or a sum certain if the firm became exclusive agents for resale of the land. On the same day of the meeting, Allabastro wrote Bley the following letter:

August 28, 1968

"Mr. Robert K. Bley Nardi and Podolsky, Inc. 221 North La Salle St. Chicago, Illinois 60601

Dr. Mr. Bley:

In the event a sale is consummated to Lamot Dupont Copeland or Winthrop Lawrence, Inc. or their nominee for the 200 acres of land fronting 1,615 feet on Devon Avenue and going back in depth to Thorndale Road, west of Route 83, Du Page County, Illinois, I agree to pay to Robert K. Bley and Nardi and Podolsky, Inc. a real estate commission of Fifty Thousand Dollars ($50,000.00). In the event an exclusive real estate agreement is entered into between the above purchasers and Nardi and Podolsky, Inc. for the development of this property, Robert K. Bley and Nardi and Podolsky, Inc. will only be entitled to a real estate commission for the sale of Twenty Five Thousand Dollars ($25,000.00), this commission to be paid upon consummation of sale and passing of title.

Yours very truly, /s/ Robert A. Allabastro Robert A. Allabastro

It is further agreed that Robert Allabastro shall be entitled to commissions equal to 20% of all commissions collected by Nardi and Podolsky for sale of said land. Total commission ...

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