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03/10/87 Anthony Lavaja Et Al., v. Robert Carter

March 10, 1987

ANTHONY LAVAJA ET AL., PLAINTIFFS-APPELLEES

v.

ROBERT CARTER, DEFENDANT (STEPHEN HOUSE, THIRD-PARTY, DEFENDANT-APPELLANT; MICHAEL WOJNOWSKI, THIRD-PARTY, DEFENDANT-APPELLEE



APPELLATE COURT OF ILLINOIS, SECOND DISTRICT

505 N.E.2d 694, 153 Ill. App. 3d 317, 106 Ill. Dec. 147 1987.IL.274

Appeal from the Circuit Court of Du Page County; the Hon. Helen C. Kinney, Judge, presiding.

APPELLATE Judges:

Justice Inglis delivered the opinion of the court. Reinhard, J., concurs. Justice Nash, Dissenting.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE INGLIS

The defendant, Stephen House (defendant), appeals from the circuit court's order striking his pleadings, both answer and counterclaim, and entering a default judgment against him because of his failure to comply with discovery rules and court orders. The underlying action was plaintiffs' suit to recover payments on a promissory note owed by defendant and Robert Carter (a co-defendant not a party to this appeal).

On May 14, 1984, Anthony and Eleanor Lavaja (plaintiffs) filed a complaint alleging that "On December 15, 1982, for value received, Robert Carter and Stephen C. House, made, executed and delivered a Promissory Note dated December 15, 1982, promising therein to pay Plaintiffs the principal sum of $65,000.00 plus interest, as set forth therein, with a final payment of the unpaid principal and accrued interest on January 15, 1984." They further alleged that after repeated demands, the defendants failed to make the final payment and are in default on the note. In a sworn affidavit, Anthony Lavaja stated that he negotiated the transaction in the office of Michael B. Wojnowski (Wojnowski), 880 North York Road, Elmhurst, Illinois. Wojnowski, in a sworn statement, stated that he witnessed the execution of the note on December 15, 1982, and that he had negotiated the note with the defendants and plaintiffs in his office.

On September 11, 1984, the plaintiffs were granted a substitution of attorneys. Dan Walker, Jr. (Walker), thereafter represented the plaintiffs. On May 31, 1985, Walker filed a notice to produce seeking, inter alia, statements, checks, checking accounts, corporate records, correspondence, promissory notes, and income tax records from defendant.

On June 14, 1985, defendant House was granted leave to file a third-party complaint against Wojnowski, alleging that Wojnowski fraudulently induced defendant to sign various promissory notes in blank in connection with a scheme that purportedly was directed toward purchasing a number of businesses, including the outstanding stock of Gallagher Textile Mills, Inc. Wojnowski was served with process and appeared before the court represented by Walker.

On October 29, 1985, defendant filed a motion to substitute his attorney which the court granted. His new attorney filed a memorandum in support of a motion to disqualify plaintiff's counsel based on his contention that Walker was in conflict of interest in representing both the plaintiffs and the third-party defendant in the same action. At the hearing of October 31, 1985, plaintiffs' counsel informed the trial court that defendant's counsel was refusing to continue discovery. The following colloquy ensued:

"THE COURT: What kind of discovery is outstanding?

MR. WALKER: There have been interrogatories, two checking accounts. I have been to Mr. Kane's office twice, and Mr. Marcham's office one time to look at the documents. As I said, I have been there. I said, 'This is not here. We will come back.'

MR. KANE: You have looked at all of the documents.

MR. WALKER: I have not. The answer to interrogatories indicates there are two other checking accounts which I have never seen, ...


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