APPEAL from the Circuit Court of Cook County; the Hon. JOHN F.
HECHINGER, Judge, presiding.
MR. PRESIDING JUSTICE GOLDBERG DELIVERED THE OPINION OF THE COURT:
Tom R. Evans (defendant) has appealed from an order denying him relief pursuant to section 72 of the Civil Practice Act (Ill. Rev. Stat. 1977, ch. 110, par. 72). Defendant sought relief from a portion of a judgment entered against him awarding Joseph A. Thorsen Company and James Cerny (plaintiffs) $65,200 compensatory damages and $50,000 punitive damages.
The pertinent facts are undisputed. Plaintiffs filed a fourth amended complaint in chancery against defendant and another party. Plaintiffs alleged defendant became an employee of Thorsen Company in April 1971. In May 1971, defendant represented himself to the Continental Illinois National Bank as an officer of Thorsen and established a land trust. The designated beneficiary of the land trust was "R.S. Fulton." This name was an alias used by defendant. Actually defendant was the beneficiary of the land trust.
Defendant submitted 18 separate offers for various parcels of land to the Continental Bank. He requested the bank to execute these offers in its trust capacity. All of these offers were made without the knowledge and consent of the Thorsen Company. One of these offers was to purchase a 360-acre parcel of land known as "Big Timber." That offer was accepted by the seller. In due course an installment contract was executed for purchase of the Big Timber property by the land trust for $1562.50 per acre. Defendant then told the president of Thorsen he had a client named R.S. Fulton who was willing to sell the Big Timber property to Thorsen Company for $2062.50 per acre. Defendant further represented the price was sound and if certain zoning changes were made, R.S. Fulton would repurchase the property from Thorsen Company for $2350 per acre, thus assuring a profit. Thorsen authorized defendant to form an investment group to purchase the property. Defendant himself expressed a willingness to become an investor in the group and made an initial payment of $7411.80.
Plaintiffs' fourth amended complaint alleged defendant contacted numerous people and obtained funds from them. Some of these people intended their money to go into a different property investment, but defendant diverted the funds into the Big Timber project. These sums, together with the amounts invested by Thorsen and defendant, were tendered to the seller as a down payment on the Big Timber property. At this point, Thorsen became aware of defendant's scheme. Its representatives contacted all of the individual investors in Big Timber, informed them of what happened and offered to purchase their interests in the investment. Thorsen purchased an assignment of the interests of all the investors except plaintiff Cerny. The Thorsen Company made every installment payment, including interest, due under the contract and paid all real estate taxes relative to the property.
Plaintiffs further alleged that as a result of defendant's acts, he breached numerous and various duties to Thorsen by virtue of their employer-employee relationship and breached his fiduciary duties to the investment group to which both plaintiffs belonged. Plaintiffs sought the imposition of a constructive trust, so that the beneficial interest in the land trust would belong to plaintiffs, an accounting, general relief and punitive damages of $500,000.
Defendant filed no answer to the plaintiffs' fourth amended complaint. However, by his attorney of record, defendant had previously filed an answer to plaintiffs' second amended complaint. The case was scheduled for trial on August 15, 1977. Defendant failed to appear at trial. The trial court entered a default order against defendant on August 18, 1977. The case was continued "By agreement of the parties" to September 12, 1977. At this point, plaintiffs added Continental Illinois National Bank as trustee as a defendant to the action so the court could make a final disposition of the property contained in the trust. On September 12, 1977, defendant's counsel moved and was granted leave to withdraw because of his client's failure to appear. On September 16, a prove-up trial was held.
The trial court entered judgment on October 27, 1977, nunc pro tune as of September 16, 1977, imposing a constructive trust for the benefit of plaintiffs. The beneficial interest in the land trust, as it relates to the Big Timber property, was transferred to plaintiffs. Also, judgment was entered against defendant for $65,200 in compensatory damages and $50,000 in punitive damages. Defendant's contribution of $7411.80 to the investment group was ordered retained by plaintiffs as partial satisfaction of the award of compensatory damages. Finally, defendant was to have no right to any commissions, fees, costs or reimbursements arising from the Big Timber property investment.
A supplemental order dated October 27, 1977, disposed of $12,000 which was being held in the land trust. The order directed the Continental Bank as trustee to take $7000 as trustee's fees and trustee's attorney's fees along with an additional $2000 to said Bank individually. The balance of the money in the trust was to be paid to Thorsen Company. The land trust was then dissolved.
On April 3, 1978, defendant filed a section 72 petition to vacate the judgment and supplemental order. The trial court denied this petition and defendant appeals.
In this court, defendant contends it was improper to award compensatory damages at an ex-parte hearing held after the order of default because defendant had no notice such relief was being sought. Furthermore, defendant urges since the compensatory damages were improperly awarded, no punitive damages should have been allowed. Plaintiffs contend only that the trial court did not err in denying relief under section 72 and the court had power to award compensatory and exemplary damages.
1, 2 This court has recently stated (Verson Allsteel Press Co. v. Mackworth Rees (1st Dist., No. 78-487, filed February 13, 1980), ___ Ill. App.3d ___, ___ N.E.2d ___):
"To warrant relief from a default judgment under section 72, the petitioner must affirmatively set forth facts revealing the existence of a meritorious defense and the exercise of due diligence in both presenting this defense and in filing the section 72 petition. [Citation.] Whether section 72 relief should be granted lies within the sound discretion of the trial court and its decision will not be disturbed on appeal unless there is an abuse of discretion. [Citations.] Section 72 is not intended to relieve a party from the consequences of his own mistake or negligence. [Citation.]" ___ Ill. App.3d ___, ___.
We find no evidence in the record that defendant exercised due diligence in presenting his alleged defense or in filing the section 72 petition. Defendant was fully aware of this action against him as evidenced by the fact that he filed an answer to previous complaints and his counsel did appear before the court. Defendant simply chose not to defend this action. A duty is imposed upon a litigant to follow the progress of his case. (Diacou v. Palos State Bank (1976), 65 Ill.2d 304, 311, 357 N.E.2d 518; Illinois Marine Towing Corp. v. Black (1979), 74 Ill. App.3d 909, 913-14, 393 N.E.2d 707.) The ...