APPELLATE COURT OF ILLINOIS, FOURTH DISTRICT
513 N.E.2d 563, 160 Ill. App. 3d 464, 112 Ill. Dec. 149 1987.IL.1318
Appeal from the Circuit Court of Greene County; th Hon. John W. Russell, Judge, presiding.
Rehearing Denied October 9, 1987.
JUSTICE LUND delivered the opinion of the court. SPITZ, P.J., and KNECHT, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE LUND
Peter J. Vogel and Gerda L. Vogel (the Vogels), counterdefendants, appeal following the denial of a motion to vacate a default judgment entered on July 17, 1985, against them and in favor of Norman L. Suttles and Lula M. Suttles (the Suttles), counterplaintiffs. The default judgment for $600,000 was entered against the Vogels, as a sanction, for failure to comply with discovery orders.
This litigation evolves from the results of a separate cause of action filed by the Vogels under the forcible entry and detainer statute (Ill. Rev. Stat. 1981, ch. 110, par. 9-102), which cause was ruled on by this court in Vogel v. Dawdy (1984), 123 Ill. App. 3d 356, 462 N.E.2d 804, and by the Illinois Supreme Court in Vogel v. Dawdy (1985), 107 Ill. 2d 68, 481 N.E.2d 679. This court finds it necessary to condense the facts in the prior case to properly present the issues now before the court.
On March 14, 1979, Vogels, as vendors, entered into a contract for the sale of two tracts of farmland to Jim G. and Carolyn S. Dawdy (the Dawdys). The contract included a nonassignability clause. Two hundred thousand dollars was paid down, and $300,000 was payable in April 1979. Annual payments of $150,000 were to follow on each succeeding February 1. On March 16, 1979, Dawdys, as vendors, entered into a contract for the sale of one tract to Suttles for $1,065,000. Suttles paid $350,000 down and were to pay $84,000 per year on each February 15. The remaining tract was sold to Norwood and Barbara Ashley (the Ashleys).
Vogels visited Dawdys' attorney in February 1980, ascertaining that the Dawdys had entered into the Suttles and Ashleys contracts. On February 27, 1980, Vogels mailed letters to Dawdys and their attorney demanding that breaches of the nonassignability clause of the Vogels-Dawdy contract, as well as a clause of the contract requiring Dawdys to keep the property insured, be remedied within 30 days. Vogels received annual payments from Dawdys in February 1980 and February 1981. No payments were made directly to Vogels by Suttles, but Suttles made annual payments to Dawdys in 1980, 1981, and 1982. Suttles also paid real estate taxes and maintained insurance required by their contract with the Dawdys. Suttles paid to Dawdys $602,000 under the contract. Ashleys paid $280,000 to Dawdys before Ashleys filed for bankruptcy on July 16, 1981. Through 1981, Vogels were paid $800,000 by Dawdys under the Vogels-Dawdys contract.
On June 11, 1980, Vogels brought a forcible entry and detainer action in the circuit court of Greene County, with Dawdys, Ashleys, and Suttles listed as defendants, requesting possession of both tracts of land. Summary judgments were entered against Dawdys and Ashleys following defaults. Vogels and Suttles proceeded to bench trial, and judgment was entered June 28, 1983, granting Vogels possession of the 426-acre parcel which was the subject of the Dawdys-Suttles contract.
Suttles appealed, contending that Vogels failed to give Suttles proper statutory notice and demand required by section 9-102 of the Code of Civil Procedure (Code) (Ill. Rev. Stat. 1985, ch. 110, par. 9-102) and further that Vogels waived the right to assert a breach of the nonassignment clause because of acceptance of payments after knowledge of the sales to Suttles and Ashleys. The trial court was affirmed by both this court (Vogel v. Dawdy (1984), 123 Ill. App. 3d 356, 462 N.E.2d 804) and the supreme court (Vogel v. Dawdy (1985), 107 Ill. 2d 68, 481 N.E.2d 679).
On March 31, 1983, the State Bank of Jerseyville filed a suit to foreclose a mortgage, executed by Vogels, on the land which was the subject of the Dawdys-Suttles contract. Vogels, Dawdys, Suttles, and Ashleys were some of the listed defendants. On May 4, 1983, Suttles answered, filed a counterclaim against Dawdys, Vogels, and William C. Sumpter, and filed a third-party complaint against attorney W. Thomas Ryder and attorney Leo F. Carroll. All parties to this appeal were served with legal process. On July 22, 1983, the State Bank of Jerseyville moved to dismiss its complaint for foreclosure, stating that Vogels cured the defaults. This motion was allowed on September 14, 1983. The record indicates that Gerda L. Vogel was served with summons on July 9, 1983, and Peter J. Vogel was served on October 11, 1983. On October 14, 1983, Suttles filed a motion asking that Gerda L. Vogel be defaulted for failing to answer or otherwise plead.
For purposes of this decision, proceedings involving parties other than Suttles, Vogels, and Leo Carroll are not important. Leo F. Carroll (Carroll) filed an answer to count II of the third-party complaint on December 2, 1983, generally denying the legal malpractice allegations stated in that count. On December 9, 1983, Gerda L. Vogel filed a motion to dismiss the Suttles' countercomplaint, suggesting improper service of process. This motion was filed by attorney Edwin R. Parkinson, and listed Parkinson's address as 219 Dunlap Court, Jacksonville. On January 18, 1984, Suttles requested leave to file a third count of their third-party complaint directed to the law firm of Flynn & Flynn, of which Leo F. Carroll allegedly was a partner at the time of the alleged malpractice.
On January 27, 1984, all pending motions were heard by the court, although attorney Parkinson was absent because of illness. The Suttles were allowed to file the count directed to Flynn & Flynn. The defendants were to comply with discovery within 30 days. Gerda L. Vogel's motion to dismiss was denied, and she was directed to respond within 28 days. The clerk was directed to send copies of the January 27, 1984, docket entry to attorneys of record. On February 6, 1984, a written order was filed denying Gerda L. Vogel's motion to dismiss, and this order directed that Gerda answer count II of the Suttles' counterclaim within 28 days. The docket entry for that date states: "Order presented and entered. Court forwards copy of orders to attorneys of record." On the same date, Peter Vogel was defaulted for failure to appear.
On February 27, 1984, attorney Parkinson filed a motion to set aside the default judgment entered against Peter Vogel. An affidavit of Peter Vogel's stated that the service of October 11, 1983, included a copy of the mortgage foreclosure complaint but no copy of the counterclaim. At the same time, Parkinson filed, on Vogels' behalf, a motion to dismiss the counterclaim, which alleged it did not state a cause of action.
Another hearing on pending motions was held on March 21, 1984, at which attorney Parkinson and attorney Mottaz (who represented Vogels) were present. The default judgment against Peter Vogel was set aside, the Vogels' motion to dismiss count II of Suttles' counterclaim was allowed, and Suttles were given 28 days to file an amended count II against the Vogels. Vogels were to file responsive pleadings to the amended count II within 28 days of the filing of the amendment. The cause was set for trial for September 25, 1984.
Suttles filed an amended version of count II of their counterclaim on April 23, 1984, with a copy being mailed to attorney Parkinson. Review of the record fails to show that prior to January 1986 Vogels answered or otherwise pleaded to Suttles' amended counterclaim.
On July 19, 1984, defendant Carroll filed a request for production of documents. This request was addressed to all parties and specifically referred to an abstract of title, as well as other documents. On October 19, 1984, Carroll filed a motion to compel discovery addressed to Peter Vogel. This motion referred to the July 19 request for discovery and a letter to attorney Parkinson dated September 24, 1984, which again requested production of the abstract of title. No compliance by Vogels or Parkinson is indicated. The record indicates that the abstract was necessary for adequate presentation of the parties' cases at trial.
A hearing on January 17, 1985, resulted in an order compelling the Vogels to provide discovery. Vogels were neither personally present nor represented by counsel at this hearing. Vogels were ordered to comply by January 28, 1985. Carroll filed another motion to compel directed to Vogels on February 19, 1985. Notices of hearing on "Second Motion to Compel -- Vogel" were sent to attorney Parkinson on February 15 and February 19, 1985. The February 19, 1985, mailing noticed the motion to compel for hearing on March 22, 1985. On February 28, 1985, the Suttles filed an additional motion to compel Vogels to provide discovery, which requested sanctions of striking the Vogels' answer and a default judgment on the basis of Vogels' failure to provide discovery. A copy was mailed to Parkinson on February 27, 1985. A motion to continue trial, filed March 8, 1985, sets forth Vogels' and attorney Parkinson's failures to produce documents pursuant to prior discovery requests. A copy of this document was mailed to attorney Parkinson. The docket entry of March 22, 1985, indicated attorney Parkinson's failure to appear at a hearing on that date. A written order of default was entered on March 25, 1985.
On June 26, 1985, by docket order, Judge Russell set a hearing on prove up for July 17, 1985, and directed the clerk to send copies of the docket entry to attorneys of record. Vogels did not appear on July 17, 1985, either in person or by counsel. Evidence was taken, and a written judgment was entered in favor of Suttles against Peter J. Vogel and Gerda L. Vogel in the amount of $600,000.
It is clear from the record that Vogels did not appear in court, personally or by their attorney, from March 21, 1984, until August 14, 1985, when they, by attorney Parkinson, filed a motion to vacate the default judgment.
The motion to vacate default judgment was not accompanied by a notice of hearing, and it appears Judge Russell set the motion for hearing for September 27, 1985. The hearing took place on September 27 and on October 29, 1985. Judge Russell filed a letter opinion on November 8 setting forth findings that attorney Parkinson is attorney of record for the Vogels and that numerous letters and notices were sent to him by attorneys for parties other than the Vogels and the clerk of the court. The court stated the Vogels "have not complied with discovery requests." The Judge then vacated the default judgment conditioned on Vogels's compensating attorney Mottaz and attorney Morrison, who represented Carroll:
"[For] their time and services and for their expenses and Court costs in connection with the proceedings in obtaining the default judgment and re: motion to vacate default judgment and in connection with discovery default on part of defendants Vogel and further on the condition that defendants Vogel respond to discovery notices and procedures within 21 days of this date or within the time agreed upon between the parties. Unless the foregoing conditions are fulfilled motion to vacate default judgment is denied."
Attorney Mottaz was directed to prepare a written order consistent with the letter. The written order was eventually signed on December 10, 1985, and filed on December 11, 1985. It was approved as to form by all attorneys.
Meanwhile, on November 19, 1985, attorney Mottaz filed his itemized statement of fees and expenses, totaling $3,824.90. On November 20, 1985, attorney Morrison filed his itemized statement of fees and expenses totaling $4,386. Copies of both statements were sent ...