Appeal from the Circuit Court of Vermilion County; the Hon.
Paul M. Wright, Judge, presiding.
JUSTICE MORTHLAND DELIVERED THE OPINION OF THE COURT:
Plaintiff brought an action against the defendant, First Midwest Bank/Danville, successor by merger to the Second National Bank of Danville, seeking money damages from an alleged breach of an oral agreement to loan money as well as for certain averred tortious conduct. The circuit court of Vermilion County dismissed the plaintiff's amended complaint with prejudice for failure to state a cause of action. Plaintiff appeals.
Plaintiff filed his four-count amended complaint on January 30, 1985. Count I sounded in breach of contract; count II alleged wilful and wanton conduct arising out of the contractual setting; count III alleged some form of negligence; count IV sounded in wilful and wanton conduct originating from the allegations contained in count III.
• 1 As we have before us the granting of a motion to dismiss, we note that, in considering this matter, all well-pleaded facts must be taken as true, as well as all reasonable inferences which may be drawn therefrom. (Morrow v. L.S. Goldschmidt Associates, Inc. (1984), 126 Ill. App.3d 1089, 468 N.E.2d 414.) Moreover, in ruling on a motion to dismiss, allegations of the complaint are to be interpreted in the light most favorable to the plaintiff. Denkewalter v. Wolberg (1980), 82 Ill. App.3d 569, 402 N.E.2d 885.
Essentially, the amended complaint alleged that the plaintiff, a farmer, had business debts totaling $400,000, of which $217,000 was owed to the First National Bank of Westville. Plaintiff in December of 1983 began discussing financial planning with the "Agri-Credit" department of the defendant bank; plaintiff avers that the defendant solicited his business, a charge the defendant disputes as conclusionary and factually incorrect. Defendant then worked out a financing plan whereby it would loan plaintiff money to pay off all his current obligations as well as finance his 1984 farming operations. In return, plaintiff was to apply for a $90,000 loan from the United States Farmers Home Administration. Defendant would then subordinate its security interest, including a first lien it would obtain from the Westville bank in paying off that indebtedness, in favor of the United States Farmers Home Administration upon the latter's agreeing to loan plaintiff the money.
Plaintiff opened an account with defendant bank as instructed. When plaintiff received a $66,000 check representing the proceeds from the sale of his last corn crop, plaintiff alleged that the bank told him to deposit the entire sum with them. Plaintiff was directed to pay only a small sum to the Westville bank instead of the entire amount as he was otherwise obligated. Plaintiff also alleged that the defendant required him to forbear from paying an installment payment due another creditor. Finally, upon the bank's instructions, plaintiff named the defendant as trustee of his residential real estate pursuant to a land trust agreement.
The amended complaint also alleged that, although plaintiff and his wife were notified to appear at a loan closing set for February 13, 1984, the defendant, without warning or notice, informed plaintiff it would not make the loans as promised. Plaintiff alleges he was therefore unable to obtain other financing. Because he did not pay off the Westville bank and other creditors with the proceeds of his corn-crop check, those creditors accelerated plaintiff's notes and demanded immediate full payment. As a result, plaintiff was forced to file for Chapter 11 bankruptcy.
Defendant filed a motion to dismiss this amended complaint for failure to state a cause of action. At the hearing on the motion held July 11, 1985, the court dismissed the amended complaint, but offered plaintiff the opportunity to replead. Plaintiff chose to stand on the pleadings instead. Consequently, the court on July 23, 1985, entered an order dismissing the amended complaint with prejudice.
Again, count I alleges breach of an oral commitment or agreement to loan. Plaintiff alleges that the defendant, through its authorized officers, "orally offered and promised" to loan plaintiff money at the variable rate of interest then charged. The loan was to be secured by liens against the plaintiff's real estate, machinery, crops, and the proceeds therefrom. Plaintiff states he accepted the oral offer and promise to make the loan by performing each of the conditions required of him. He states that he applied for and received approval of the $90,000 loan from the Farmers Home Administration, opened a bank account with the defendant, and named the defendant as trustee of his residential real estate under a land-trust agreement. Plaintiff concludes that the defendant breached its contract when it refused to make the loan without stating any reason for such refusal, thus causing plaintiff to suffer damages.
• 2-4 First, a proper and adequate complaint based upon breach of contract must allege the existence of the contract purportedly breached by the defendant, the plaintiff's performance of all contractual conditions required of him, the fact of the defendant's alleged breach, and the existence of damages as a consequence. (Martin-Trigona v. Bloomington Federal Savings & Loan Association (1981), 101 Ill. App.3d 943, 946, 428 N.E.2d 1028, 1031.) Moreover, allegations demonstrating the existence of a contract must contain facts indicating an offer, acceptance and consideration. (Martin-Trigona v. Bloomington Federal Savings & Loan Association (1981), 101 Ill. App.3d 943, 428 N.E.2d 1028.) A general allegation that a contract exists without supporting facts is a legal conclusion which may not be admitted as true by a motion to strike or dismiss (Pollack v. Marathon Oil Co. (1976), 34 Ill. App.3d 861, 341 N.E.2d 101; Barnes v. Peoples Gas Light & Coke Co. (1968), 103 Ill. App.2d 425, 243 N.E.2d 855), as neither conclusions of law nor conclusions of fact unsupported by allegations of specific facts upon which the conclusions are based may be considered in ruling on the motion. (Pierce v. Carpentier (1960), 20 Ill.2d 526, 169 N.E.2d 747.) Legal conclusions are also inadequate to serve as essential elements of a complaint. (Martin-Trigona v. Bloomington Federal Savings & Loan Association (1981), 101 Ill. App.3d 943, 428 N.E.2d 1028.) Thus, to merely state that a contract "was entered" or that the defendant "accepted" is to state mere legal conclusions. (Pollack v. Marathon Oil Co. (1976), 34 Ill. App.3d 861, 341 N.E.2d 101.) Furthermore, if the acceptance of an offer is oral, then the specific facts supporting this theory of acceptance must be alleged. Pollack v. Marathon Oil Co. (1976), 34 Ill. App.3d 861, 341 N.E.2d 101.
• 5 To pass muster, any complaint must state a cause of action in two ways. First, it must be legally sufficient, that is, it must set forth a legally recognized claim as its avenue of recovery. (People ex rel. Fahner v. Carriage Way West, Inc. (1981), 88 Ill.2d 300, 430 N.E.2d 1005.) Otherwise, there can be no recourse at law for the injury alleged and the complaint must be dismissed. Second, unlike Federal practice, the complaint must be factually sufficient; it must plead facts which bring the claim within the legally recognized cause of action alleged. (People ex rel. Fahner v. Carriage Way West, Inc. (1981), 88 Ill.2d 300, 430 N.E.2d 1005; Ill. Rev. Stat. 1983, ch. 110, par. 2-601.) As Illinois is a fact-pleading State, failure to do so allows for dismissal of the complaint. Furthermore, although ultimate facts necessary to support the action must be alleged, the pleader need not set forth evidence which may well be derived from discovery subsequent to the filing of the complaint. (Ingram v. Little Company of Mary Hospital (1982), 108 Ill. App.3d 456, 438 N.E.2d 1194.) The line between an ultimate fact and a legal conclusion, however, is sometimes difficult to discern, and depends to some extent upon the particular case. (Ingram v. Little Company of Mary Hospital (1982), 108 Ill. App.3d 456, 438 N.E.2d 1194; Van Dekerkhov v. City of Herrin (1972), 51 Ill.2d 374, 282 N.E.2d 723.) To determine whether the complaint states facts or conclusions, the entire complaint must be considered as a whole, and not just its disconnected parts. Mid-Town Petroleum, Inc. v. Dine (1979), 72 Ill. App.3d 296, 390 N.E.2d 428.
• 6 Plaintiff first argues that a valid cause of action for breach of an oral contract to lend money in the future is recognized at law, and we agree. (See Coastland Corp. v. Third National Mortgage Co. (4th Cir. 1979), 611 F.2d 969; Bank of Lincolnwood v. Comdisco, Inc. (1982), 111 Ill. App.3d 822, 444 N.E.2d 657; see also Morgan v. Young (Tex. Civ. App. 1947), 203 S.W.2d 837.) Acknowledging that a cause of action for breach of contract to loan may exist under certain circumstances, the plaintiff's complaint must still plead facts which sufficiently bring the claim within the legally recognized cause of action alleged.
• 7 Again, we must be mindful of the fine line which distinguishes conclusions of law and ultimate facts. We must also be cognizant that terms such as "offered," "accepted," and "breached its contract," as plaintiff has used in his amended complaint, suggest mere legal conclusions. Nevertheless, we believe the plaintiff has stated a cause of action under count I. He has alleged facts indicating an offer by the defendant. The defendant apparently wanted the plaintiff's banking business, and the parties entered upon discussions of a reorganization of the plaintiff's indebtedness. Defendant was to pay off the plaintiff's outstanding loans while assuming a security interest in the plaintiff's property. Also relevant to plaintiff's argument that defendant agreed to make a loan is the fact that a loan closing conference was scheduled.
Moreover, plaintiff's allegations of his actions in response indicate facts constituting acceptance. Plaintiff opened an account with the defendant, applied for the loan with the Farmers Home Administration, deposited his corn-crop check in the defendant bank, ...