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Casanas v. Nelson





Appeal from the Circuit Court of Kane County; the Hon. Paul W. Schnake and the Hon. John L. Nickels, Judges, presiding.


Defendant appeals from a judgment of the trial court of Kane County which granted rescission of a contract on grounds of mutual mistake and ordered defendant to pay restitution as well as plaintiffs' costs and attorney fees. Plaintiffs cross-appeal from an order which vacated an earlier judgment but reentered the terms of that judgment.

In this court defendant raises three contentions: (1) that the facts presented to the trial court did not support rescission of the contract; (2) that rescission was improperly granted on the basis of a mistake of law; and (3) that the award of attorney fees was inappropriate. Plaintiffs assign as error the vacation and re-entry of a judgment dated later pursuant to defendant's section 2-1401 petition (Ill. Rev. Stat. 1983, ch. 110, par. 2-1401).

Plaintiffs and defendant entered into an installment agreement for warranty deed on June 2, 1981, for the purchase of a parcel of vacant real estate owned by defendant, Gwen Nelson. On May 5, 1982, plaintiffs filed a complaint for rescission of the installment agreement based on fraud and/or mutual mistake and seeking restitution and damages. The matter was tried before the bench. Sometime in January of 1981 plaintiffs, the Casanases, saw a "For Sale" sign on a vacant lot and went to the Century 21 real estate office to inquire about it. They indicated to Dorothy Schilf, the agent who helped them, that they wished to build a two-flat on the lot. Schilf told them that a two-flat could not be built on the lot and suggested other lots, but the Casanases decided they wanted the lot they had first inquired about.

Leo Casanas, Jr., and his sister, Lisette, testified that at their first meeting with the realtor, before any contracts were signed, Schilf showed the family several documents pertinent to the lot: a survey, a document titled "Proposed Septic System," and a document titled "Application for Permit for Sewage Disposal Facilities and Water Supply." They further testified that Schilf pointed out where a house, a well, and a septic tank could be located on the lot; that Schilf told them that defendant-owner Nelson had ordered the permit described above when she was getting ready to build before she moved; and, that Schilf made repeated oral representations to the family that the lot was ready to be built upon.

Dorothy Schilf contradicted certain parts of the Casanases' testimony. She repeatedly testified that she had never shown any of the named documents to the Casanases because she had never had any of them in her possession. She insisted that she was seeing them for the first time at trial, that they had been in the hands of some other realtor in her office, and that she was not sure when they were shown to the Casanases, but suggested it might have been at the closing. Schilf did indicate, however, that she had been told of the existence of the documents by the other realtor, had asked defendant to send them to her, and had told the Casanases that they were available.

Schilf, when asked if she had made oral representations to the Casanases as to whether or not they could build a house on the lot, indicated that she had told them to check with the department of public works of Du Page County (Du Page County) as to what could be built, and that the document pertinent to a septic system would show where a septic field could be located. Leo Casanas, Jr., testified that he relied on what Schilf had told him concerning the suitability of the lot for construction and that he did not contact Du Page County concerning the lot prior to signing the contracts. An offer by the Casanases to purchase the lot was accepted by Nelson in April, and the closing took place on June 2, 1981.

In November 1981, Leo Casanas, Jr., received a letter from Homer Branch of the department of public works of Du Page County, apparently in response to Casanas' request for a building permit. The November 19 letter, which was admitted into evidence, stated that the subject lot was located within a flood hazard in accordance with the United States Housing and Urban Development (HUD) "Floodway and Boundary Maps dated 1977." In his testimony, Casanas claimed that he understood from the letter that the property was not buildable because it was in the floodplain.

Plaintiffs then retained an independent engineer, Peter Johanknecht, to review the entire matter. Johanknecht did not appear or testify at trial, but a letter he had written to Homer Branch was admitted into evidence. The letter, dated January 13, 1982, referred to enclosures showing the subject lot in relation to the floodplain and requested Branch's "concurrence as to the location of floodplain on the referenced lot." The enclosures were not admitted as evidence. Branch replied by letter of January 21, 1982, that Johanknecht's "information only reflects the period prior to construction of I-90," and that "[t]he new HUD maps * * * reflect this newly constructed highway based on more recent studies," and finally, that "[a] special use permit is required." Branch testified to these same matters at trial but, when asked when the new floodplain maps came into use by the county, he responded as follows:

"A. I would say around 1981.

Q. About 1981. Do you remember approximately when in 1981?

A. I couldn't be specific.

Q. Sometime in that era?

A. Yes. We had — we knew this regulation were [sic] coming, so we were in effect using these regulations. So when they became finalized by the federal ...

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