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Unger v. Nunda Twp Rural Fire Prot. Dist.





Appeal from the Circuit Court of McHenry County; the Hon. Roland Hermann, Judge, presiding.


Plaintiff, Robert M. Unger, filed suit against various parties seeking to recover damages for the destruction by fire of certain trees on property which he was in the process of purchasing under an installment sales contract. He is appealing an order granting defendant Terra Cotta Realty Company (Terra Cotta) summary judgment under section 2-1005 of the Code of Civil Procedure. Ill. Rev. Stat. 1983, ch. 110, par. 2-1005.

The pleadings and affidavits filed in this case disclose that on November 15, 1978, plaintiff and his wife, as purchasers, and Oscar Borst, as vendor, entered into an installment contract for the sale of certain real estate in McHenry County. The contract required plaintiff and his wife to pay Borst $5,000 upon execution of the contract, $30,000 upon closing of the contract, and $40,000 on October 15, 1979, and on that same date in each of the next four years. Borst was required to convey title to a trust at the McHenry State Bank, which trust would require assignment of the beneficial interest to plaintiff upon full payment of the purchase price. The contract made provision for possible "interim conveyances" of portions of the real estate to plaintiff prior to full payment.

The contract included two different provisions regarding transfer of possession of the property. One stated that "[p]ossession of all buildings on the premises shall be given to purchaser as of October 1, 1978." The other provided that "[p]ossession of the premises shall be delivered to Purchaser on closing which shall be within fifteen (15) days from delivery of Owners Title Insurance Policy in accordance with this Agreement." The contract required the title insurance policy to be delivered by December 15, 1978. The agreement also provided that plaintiff "shall have the right to remove trees."

The contract did not expressly allocate risk in case of destruction of buildings or trees on the property by fire or other disaster. It included the following paragraph regarding fire insurance:

"Purchaser shall keep all buildings at any time on the premises insured in Seller's name at Purchaser's expense against loss by fire, lightning, windstorm and extended coverage risks in companies to be approved by Seller in an amount at least equal to the sum remaining unpaid hereunder, which insurance, together with all additional or substituted insurance, shall require all payments for loss to be applied on the purchase price, and Purchaser shall deliver the policies therefor to Seller."

The agreement also provided:

"No right, title or interest, legal or equitable, in the premises, or any part thereof, shall vest in Purchaser until the delivery of the deed aforesaid by Seller, or until the full payment of the purchase price at the times and in the manner herein provided."

On February 1, 1979, plaintiff entered into a contract with a nursery and landscaping company to sell the trees on the property. Pursuant to that agreement, certain trees were removed and sold.

Terra Cotta owned land adjacent to that being purchased by plaintiff. In addition, Oscar Borst owned and resided on property that he was not selling to plaintiff which was adjacent to the property plaintiff was purchasing. On April 18, 1980, Terra cotta started a brush fire on its property, intending to conduct a "controlled burn." The fire burned out of control and destroyed trees on the property plaintiff was purchasing as well as on Borst's residential property.

On November 20, 1980, Oscar Borst and his wife signed a release in favor of Terra Cotta. That document recited that in consideration of $4,000 the Borsts, "their heirs, executors and administrators" released Terra Cotta from all causes of action, and particularly for fire damage to trees "on the property of Oscar Borst" and his wife. The property was not otherwise described. This release was negotiated and executed after the president of Terra Cotta, George Berry, along with Borst, walked through the property Borst was selling to plaintiff to survey the damage. At that time plaintiff had not yet acquired title to the property under the installment contract.

Plaintiff subsequently filed suit against Terra Cotta, the Nunda Township Rural Fire Protection District, Nunda Township, and the village of Prairie Grove, seeking damages for the trees that had been burned. Recovery was sought under theories of negligence and wilful and wanton misconduct. The complaint against the village of Prairie Grove was dismissed without prejudice on plaintiff's motion. The trial court entered summary judgment in favor of the other three defendants. As noted above, plaintiff is appealing only the summary judgment entered in favor of Terra Cotta.

The basis for the trial court's decision regarding Terra Cotta was its conclusion that Borst was the party who had suffered the loss. The release Borst signed was, therefore, sufficient, the trial court concluded, to protect Terra Cotta. The trial court also concluded that plaintiff had improperly pleaded his damages but stated that said pleading defect, which could be corrected, was not the basis of its decision.

In support of the trial court's decision, Terra Cotta maintains that under the installment sales contract between Borst and plaintiff the risk of loss by fire was on Borst, the vendor. Because it was his loss, Terra Cotta maintains, Borst, and not plaintiff, had standing to sue. In support of its contention that the risk of loss was on the vendor, Terra Cotta cites Geist v. Lehmann (1974), 19 Ill. App.3d 557, 312 N.E.2d 42. In response to Terra ...

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