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03/13/87 Herbert W. Jaeger & v. Slovak American Charitable

March 13, 1987

HERBERT W. JAEGER & ASSOCIATES, PLAINTIFF-APPELLANT

v.

SLOVAK AMERICAN CHARITABLE ASSOCIATION ET AL., DEFENDANTS-APPELLEES



APPELLATE COURT OF ILLINOIS, SECOND DISTRICT

507 N.E.2d 863, 156 Ill. App. 3d 106, 107 Ill. Dec. 710 1987.IL.296

Appeal from the Circuit Court of Lake County; the Hon. William D. Block, Judge, presiding.

APPELLATE Judges:

JUSTICE UNVERZAGT delivered the opinion of the court. HOPF and DUNN, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE UNVERZAGT

This is an appeal from the circuit court of Lake County assessing damages against plaintiff in the amount of $142,640.

Herbert W. Jaeger & Associates (Jaeger), a general contractor, sued the Slovak American Charitable Association (the association) for breach of a construction contract and foreclosure of a mechanic's lien against the property. The defendant association counterclaimed, alleging that Jaeger had breached the contract. Jaeger ceased work on the building in July 1973 when the association's lender refused to make scheduled payments to Jaeger and its subcontractors because Jaeger refused to comply with the bank's requests for more information. The trial court entered judgment for Jaeger and granted a mechanic's lien against the property. On appeal, this court reversed, finding that the bank's requests for information were authorized under the Mechanics' Liens Act (Ill. Rev. Stat. 1971, ch. 82, par. 5) and that Jaeger breached the contract when it stopped construction. (Deerfield Electric Co. v. Herbert W. Jaeger & Associates, Inc. (1979), 74 Ill. App. 3d 380.) The case was remanded to the trial court with instructions to enter judgment for the association and to hold a new trial solely to assess damages on the counterclaim. Jaeger petitioned for a rehearing, after which this court entered a supplemental opinion instructing the trial court to award Jaeger the value of benefits received by the association as a result of Jaeger's partial construction, less damages caused by its failure to complete the work. 74 Ill. App. 3d 380, 386-87.

On remand, the court assessed the association's damages at $151,440, which included amounts paid to Jaeger and its subcontractor, and $20,000 attributable to the cost of removing the incomplete structure. The court then reduced the award by $8,800 for windows removed from the construction site and retained by the association, resulting in a net award of $142,640. The court found the windows to be the only benefit conferred upon the defendant as a result of plaintiff's part performance. The building was never completed, and the association eventually sold the property in 1979 for $415,000, which included a $20,000 price reduction for removing the construction. Plaintiff appeals both the court's Conclusion that the incomplete structure was of no benefit to the association and the amount awarded on the counterclaim. A more detailed version of the facts is set out in our previous opinion (Deerfield Electric Co. v. Herbert W. Jaeger & Associates, Inc. (1979), 74 Ill. App. 3d 380), and we will not repeat them here, except as is necessary to a review of the trial court's assessment of damages. I

Plaintiff contends that the trial court erred in concluding that the windows retained by the association were the only benefit conferred on it by virtue of plaintiff's partial construction of the building.

A

Plaintiff argues that the trial court misinterpreted this court's supplemental opinion requiring an award to plaintiff for its partial performance. The supplemental opinion provided:

"[As] it appears from the record that Jaeger did partially perform the contract in good faith it would be unjust to deprive Jaeger of the amount of the benefits received from such performance by the Association, less any damages to the Association resulting from Jaeger's failure to complete the contract." (Deerfield Electric Co. v. Herbert W. Jaeger & Associates, Inc. (1979), 74 Ill. App. 3d 380, 386-87.)

On remand, the circuit court found that "there was no substantial performance of the contract by Plaintiff, no improvement of the construction site by the Defendant, [ sic ] and no retaining of any benefits or acceptance of any benefits by the Defendant in this cause excepting the . . . windows retained by Defendant."

We find no merit in plaintiff's argument that the circuit court improperly required plaintiff to demonstrate substantial performance of the contract as a prerequisite to awarding plaintiff the value of its partial construction. Even where a party's performance has been less than substantial, he may recover the value of the benefit his good-faith partial performance has conferred upon another. (South Beloit Electric Co. v. Lar Gar Enterprises, Inc. (1967), 80 Ill. App. 2d 367, 375.) Here, however, the court clearly based its refusal to make such an award on its finding that, other than the windows, no benefits were conferred on and accepted by the association. The fact that the court awarded plaintiff the value of the windows clearly demonstrates that it did not believe Jaeger's failure to substantially perform prohibited an equitable award to the plaintiff. In addition, we find that this court's supplemental opinion, ...


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