APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, FIRST DIVISION
Wholesale Roofing, Inc., Third-Party, Defendant and
516 N.E.2d 486, 163 Ill. App. 3d 51, 114 Ill. Dec. 331 1987.IL.1586
Appeal from the Circuit Court of Cook County; the Hon. Fred W. Reither, Judge, presiding.
JUSTICE CAMPBELL delivered the opinion of the court. QUINLAN, P.J., and BUCKLEY, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE CAMPBELL
This appeal arises out of a complaint filed on November 25, 1981, by plaintiff, Grand Western Currency Exchange, Inc. (Grand Western), against defendant, A:M Sunrise Construction Company , and out of a third-party complaint and counterclaim filed on October 27, 1983, by A:M against Gemco Wholesale Roofing, Inc. (Gemco), Phoenix Roofing Company, Inc. (Phoenix), and Grand Western. In the original complaint, Grand Western alleged that it was a holder in due course and sought judgment against A:M for $3,570, the amount of a check made payable to Phoenix by A:M, endorsed by Robert Durschlag as president of Phoenix, and cashed by Grand Western on October 29, 1981 (the $3,570 check). On November 2, 1981, due to a stop payment order which had been issued by A:M earlier that day, *fn1 the drawee bank refused payment on the $3,570 check.
In its answer and affirmative defense to Grand Western's complaint, A:M denied that Grand Western was a holder in due course, on the grounds that: (1) the endorsement on the $3,570 check was a forgery because Robert Durschlag had not been the president of Phoenix at the time he endorsed and cashed the $3,570 check; and (2) Durschlag had had no authority to cash checks made payable to Phoenix.
The third-party complaint and counterclaim filed by A:M on October 27, 1983, sought a declaratory judgment as to the rights of Gemco, Phoenix and Grand Western to the $3,570 sum. In its complaint, A:M alleged that after it had issued the $3,570 check to Phoenix, it had discovered defects in the materials and labor furnished by Phoenix which required A:M to pay an additional $1,053 to another roofing company to correct. In its prayer for relief, A:M requested that in the event the court finds that Grand Western is entitled to the $3,570, the court also find that A:M is not liable to either Gemco or to Phoenix for the sum, and that the court enter a judgment in favor of A:M and against Phoenix and Gemco in the amount of $1,053. In the alternative, A:M requested that in the event the court determines that Grand Western is not a holder in due course: (1) the court declare that the assignment to Gemco from Phoenix is not binding on A:M and that A:M is entitled to retain the sum of $3,570; *fn2 or (2) if the court determines that Gemco's assignment is valid as to the sum paid by A:M, that A:M be allowed to retain $1,053 of the $3,570 as a set-off for costs incurred to correct and repair the defects in the work performed by Phoenix. *fn3 ...