APPEAL from the Circuit Court of Sangamon County; the Hon.
HOWARD LEE WHITE, Judge, presiding.
MR. JUSTICE MILLS DELIVERED THE OPINION OF THE COURT:
Rehearing denied December 20, 1978.
We affirm almost in toto.
But first, a synopsis of the tedious and the prolix facts.
Russel Lesperance was a shareholder in the defendant corporations which owned seven apartment properties. Lesperance contacted W. Joseph Gibbs concerning the purchase of those properties and (after some preliminary negotiations) Gibbs formed Lincolnland Properties, Inc., in order to acquire them. Their designations will be helpful:
1. Butterworth Apartments, Inc. (Moline 42),
2. University Apartments of Normal, Inc. (Champaign 21),
3. University Apartments, Inc., of Normal, Illinois, and Landmark Apartments of Urbana, Inc. (Normal 36),
4. Landmark Apartments of Urbana, Inc. (Urbana 118),
5. West Townhouse Apartments of Champaign, Inc. (Champaign 45),
6. Golfview Apartments of Peoria, Inc. (Golfview 24),
7. Golfview Apartments of Peoria, Inc. (Golfview 42).
Shortly before the closing, Gibbs discovered that Urbana 118 was subject to a recorded, but unlisted, third mortgage in the amount of $300,000. That mortgage was from Landmark Apartments of Urbana, Inc., to Russel Lesperance and Lesperance Builders, Inc. (a wholly owned corporation of Lesperance), and had been assigned to the Bank of Commerce of Milwaukee, Wisconsin. Or, a chart might show it this way:
Gibbs testified that Lesperance advised him that this encumbrance was not a valid debt since it was owed to himself and one of his solely owned corporations and that he could get the mortgage ...