APPELLATE COURT OF ILLINOIS, FIFTH DISTRICT
506 N.E.2d 751, 154 Ill. App. 3d 111, 107 Ill. Dec. 8 1987.IL.459
Appeal from the Circuit Court of St. Clair County; the Hon. Roger M. Scrivner, Judge, presiding.
JUSTICE KASSERMAN delivered the opinion of the court. KARNS, P.J., and WELCH, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE KASSERMAN
Plaintiff, Halliburton Company, has perfected this appeal from a judgment entered by the circuit court of St. Clair County in favor of defendant, Roger Marlen. The following facts appear in the record.
On March 20, 1981, plaintiff filed a complaint against defendant alleging that defendant was indebted to plaintiff in the amount of $9,000, plus interest, pursuant to a letter of guaranty. Specifically, it was alleged that defendant guaranteed payment for services and materials furnished by plaintiff to Sandrock Company, an Illinois corporation. On April 27, 1981, defendant filed an answer which did not assert an affirmative defense. However, an affirmative defense unsupported by a motion for leave to amend the answer was filed by defendant on September 30, 1981, alleging that defendant was entitled to a $14,960.10 setoff, this being the amount of damage wrongfully caused by plaintiff's employees to one of Sandrock's oil wells.
On March 8, 1985, the date of trial, plaintiff filed a motion to strike defendant's affirmative defense. This motion stated that the affirmative defense should be stricken because (1) defendant's answer did not contain an affirmative defense, (2) defendant failed to formally request the court's permission to file an affirmative defense, (3) defendant failed to give plaintiff notice of any hearing on whether defendant should be allowed to file an affirmative defense, (4) defendant did not file his affirmative defense within a reasonable time, and (5) the affirmative defense is not related to the subject matter of plaintiff's complaint. The circuit court granted defendant leave to file the affirmative defense instanter and denied plaintiff's motion to strike. The following evidence was admitted at trial.
On August 24, 1979, defendant signed a letter of guaranty in favor of plaintiff. This letter of guaranty provided that defendant would be primarily liable to plaintiff if Sandrock Company failed to pay plaintiff for services and materials extended to Sandrock pursuant to an open line of credit. The limit of defendant's guaranty was $10,000.
Through the end of 1979, plaintiff extended Sandrock $10,565.04 in services and materials pursuant to the open line of credit. Sandrock paid plaintiff this sum on January 18, 1980. During 1980, plaintiff extended Sandrock $9,000 in services and materials pursuant to the open line of credit. At the end of 1980 Sandrock's indebtedness to plaintiff including interest was $9,473.32.
In early 1981 Sandrock declared bankruptcy. On February 9, 1981, plaintiff filed a proof of claim in bankruptcy court alleging that Sandrock owed it $9,781.24. On February 10, 1983, the trustee in bankruptcy issued plaintiff a $2,763.22 payment, which was the final distribution in Sandrock's chapter VII bankruptcy. Thus, plaintiff was seeking from defendant the difference between the bankruptcy settlement and Sandrock's $9,000 debt plus interest.
Defendant, who was formerly the chief operating officer of Sandrock, testified as follows regarding the affirmative defense. In 1979 Sandrock drilled several oil wells outside of Tilden, Illinois, at a location known as Canning Fields. In order to develop the Canning No. 2 well, Sandrock was required to drill through a sandstone formation which the Illinois Power Company used to store natural gas. In order to get Illinois Power's permission to develop the Canning No. 2 well, Sandrock was required to agree to seal, with cement, the sandstone formation from their drilling operation. Sandrock hired plaintiff to complete this work.
On November 21, 1979, defendant and an Illinois Power representative went to the site of the Canning No. 2 well to supervise plaintiff's work on this project. Defendant explained the procedure to be performed as follows: The hole drilled into the ground was 6 7/8 inches in diameter and extended to a depth of approximately 2,100 feet. Inside of this hole was a long-string pipe, 4 1/2 inches in diameter, which extended down the well into the "pay zone" (i.e., where the oil is expected to be located). Attached to the end of this pipe was a Baker open hole packer, which is used to seal the hole to the "pay zone" from any cement contamination. To get the rubber packer set to seal the hole, a metal ball is pumped with water down the long-string pipe into the end of the packer. The ports located above the packer set would then open, allowing the water to escape up the sides of the hole. Once circulation was established (i.e., water came flowing to the surface around the long-string pipe), cement would be pumped into the long-string pipe. Two hundred to four hundred pounds of pressure were required to circulate the cement. This would continue until the cement had circulated sufficiently to seal off the drill hole. After pumping all the cement into the pipe, water would be used to pump a wiper plug through the pipe to clean out the cement.
Since cement circulates slowly and hardens quickly, circulation of the cement must be kept constant. In order to maintain such circulation, a dual manifold system would be attached to the long-string pipe. The dual manifold system plaintiff brought to the site had one hose opening, two valves (one on top, one on bottom), a wiper plug, and a wiper plug release pin. During the water and cement circulation operations the top valve was to be closed and the bottom valve was to be open while the liquids were pumped into the hose opening. After pumping all of the cement into the pipe, the cleaning operation was to begin. This was to be accomplished by ...