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Swager v. Couri





APPEAL from the Circuit Court of Peoria County; the Hon. CALVIN R. STONE, Judge, presiding.


This is an appeal from a judgment of the circuit court of Peoria County awarding both actual and punitive damages for tortious interference with contractual relations.

The plaintiffs, Swager, Johnson, Anderson, Blye, Gramley, Harris and Lang (hereinafter known as Swager) alleged that the defendants, Couri, Riley and Reardon, while acting as officers, directors and shareholders of the Fondulac Nursing Manor, Inc. (hereinafter known as Fondulac), intentionally induced Fondulac to breach its contract with Swager and thereby deprived Swager of payment for architectural services rendered under the contract.

Early in 1969 Charles Blye, a partner in Swager, and Riley and Couri discussed the proposed construction of a nursing home in East Peoria, Illinois. On March 31, 1969, Blye prepared a sketch of the proposed site for the nursing home and presented it to the zoning board of East Peoria. On May 22, 1969, Blye met at the site with Couri and Riley, who stated that they wanted to organize a group of investors to construct a nursing home. Between May and July 16, 1969, Blye and Riley went to Springfield to meet with FHA officials regarding financing of the proposed nursing home project. On July 16, 1969, Blye met with a group of investors at Swager's office where he discussed the project.

In August of 1969 Swager prepared a proposed agreement which was signed by Blye and sent to Couri. This agreement was not signed by Couri or Riley or any other members of the group of investors considering the construction. Swager was informed that it would not be signed until the group determined whether the enterprise would be a land trust or a corporation.

On December 16, 1969, Blye attended a meeting of the proposed investors at Swager's office and was asked to commence the schematic design portion of the project. From December 16 until April 22, 1970, Swager performed architectural services for a committee of 15 persons, including Couri and Riley, in connection with the proposed construction of the nursing home.

On March 16, 1970, Couri, acting as incorporator, filed articles of incorporation for Fondulac Nursing Manor, Inc., as an Illinois for profit corporation with an initial stated capital of $1,500.

On April 22, 1970, 15 original shareholders, including Couri and Riley, met at Swager's office with Blye. At this meeting directors and officers of the corporation were elected, previous actions of the incorporator and promoter, Couri, were ratified and an unsigned agreement dated August 20, 1969, between Fondulac and Swager was approved. The directors were informed by Blye that Swager had $5,023.47 invested in Fondulac.

Subsequently, 13 of the 15 investors withdrew from Fondulac.

In late August or early September of 1973, defendant Reardon met with Blye and attorneys for Swager at their office in Peoria and Reardon advised Swager's attorney that Fondulac was without funds and had not had any money for some two years and that the corporation was dissolved or in the process of being dissolved.

On September 11, 1973, the defendants Couri, Riley and Reardon filed a statement of intent to dissolve the corporation and on September 27, 1973, filed articles of dissolution. No written notice of intent to dissolve the corporation was sent to Swager.

Reardon understood that Swager would be unable to recover its fee after dissolution of Fondulac but did not believe that dissolution would diminish any dollar rights of Swager because there were no corporate assets for Swager to recover at the time of dissolution. Riley knew that Fondulac was without any money at all and that Swager would not be paid. Couri was aware that if Fondulac were dissolved there would not be no corporation after the dissolution and assumed that Swager could only seek payment up to the value of the assets of Fondulac. He thought that there was less than $1,000 in corporate assets at the time of dissolution. He said that he and Riley came into possession of those assets.

At the time of the dissolution of Fondulac, Swager's claim was the only outstanding indebtedness.

Subsequent to the dissolution, Riley, Couri and Reardon formed a Nevada corporation; they became the sole investors, shareholders, directors and officers of that corporation; and that corporation eventually constructed a nursing ...

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