APPEAL from the Circuit Court of Cook County; the Hon. ARTHUR
L. DUNNE, Judge, presiding.
PRESIDING JUSTICE SULLIVAN DELIVERED THE OPINION OF THE COURT:
Rehearing denied February 22, 1982.
Defendant appeals a declaratory judgment in plaintiff's favor, contending the trial court erred in holding that the phrase "to the date of death" in an agreement was intended to include the date on which plaintiff's decedent, John D. MacGuffin, died.
The facts are largely undisputed. Plaintiff is the successor trustee under a self-declaration of trust established by decedent, who was a director, officer, and shareholder of defendant. Upon decedent's death on November 17, 1979, plaintiff became the owner, under the trust, of 32,500 of the 65,000 outstanding shares of defendant's stock. The remaining 32,500 shares were owned by Richard Bland.
Decedent, Bland, and defendant had executed a "Buy-Sell Agreement" (agreement) in 1971 which, in pertinent part, required defendant to purchase decedent's interest after his death at a price to be computed as provided in the agreement and paid over a 4-year period at 6 percent annual interest. The agreement also required that in the event of such purchase, the value of the stock was to be determined by an audit of the defendant's books covering the period from the date of the last audit report to the date of decedent's death. Pursuant thereto, defendant had an audit made covering the period from the last audit through November 16, 1979, the day before decedent's death, which excluded from the audit $174,360, which became an asset of defendant as beneficiary of several life insurance policies on decedent.
Plaintiff filed a complaint for declaratory judgment alleging that the audit should have encompassed November 17, 1979, the date of decedent's death, which would have included the insurance proceeds. Defendant then moved for judgment on the pleadings on the ground that as a matter of law the word "to" in the phrase "to the date of death" excludes November 17, 1979, which therefore was properly omitted from the audit evaluating its assets. Plaintiff then filed a cross-motion for judgment which was granted on the finding of the trial court that the phrase "to the date of death" included November 17, 1979 the date of decedent's death. This appeal is taken from that judgment.
The sole issue presented on appeal is whether the phrase "to the date of death," as commonly understood in the law, includes or excludes the date of decedent's death. The agreement in question provides in relevant part:
"1. In the event of the death of either of the Second Parties [decedent or Bland], the said Second Parties * * * do hereby agree to sell to the First Party [defendant] and the First Party agrees to purchase * * * all of the capital stock standing in the name of any such deceased shareholder * * * at the book value of said capital stock as hereinafter set forth in paragraph 3.
3. In the event of the purchase of stock from the estate of any shareholder under the provisions of Paragraph 1 of this agreement, the book value of the stock of said corporation shall be determined by audit of the books of account of said corporation by Alexander X. Kuhn & Co., Certified Public Accountants, covering the period from the date of the last audit report to the date of death."
It is a familiar principle of contract construction that the words used be given their ordinary, natural and commonly accepted meaning unless it clearly appears that the parties intended to ascribe to them a peculiar or unusual meaning. (Illinois Valley Asphalt, Inc. v. La Salle National Bank (1977), 54 Ill. App.3d 317, 369 N.E.2d 525.) Equally well established is the rule that every contract is presumed to incorporate existing law (Illinois Bankers Life Association v. Collins (1930), 341 Ill. 548, 173 N.E. 465; Needy v. Sparks (1979), 74 Ill. App.3d 914, 393 N.E.2d 1252), so that "the courts, in construing the existing law as part of the express contract, * * * are merely construing the contract in accordance with the intent of the parties" (Schiro v. W.E. Gould & Co. (1960), 18 Ill.2d 538, 544, 165 N.E.2d 286).
With respect to the use of the word "to" in a contract, it is stated in 34 Ill. L. & Prac. Time § 7 (1958) that:
"Where the time for doing an act is extended `to' a specified date, the doing of the act on the specified date is too late. Originally, where a contract simply provides that it is to extend to a certain date, the word `to' means until and excludes the date following it as a part of the contract, but where a contract is to take effect from its date, and to continue to a certain other date, the latter is not excluded but is to be considered as the last day of the contract."
Defendant refers us to a number of cases in support of its position that the date of defendant's death should be excluded from the audit. We believe, however, that they are distinguishable from the case before us. In Stearns v. Sweet (1875), 78 Ill. 446, a question was raised as to whether an endorsement on each of a number of promissory notes which read "[i]nterest paid on the within note to July 26 * ...