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06/24/88 Wilmette Real Estate and v. June E. Luvisi Et Al.

June 24, 1988





526 N.E.2d 477, 172 Ill. App. 3d 232, 122 Ill. Dec. 218 1988.IL.995

Appeal from the Circuit Court of Cook County; the Hon. Arthur L. Dunne, Judge, presiding.


JUSTICE SULLIVAN delivered the opinion of the court. LORENZ, P.J., and MURRAY, J., concur.


This appeal is from the dismissal of count I and summary judgment on count II of a complaint seeking payment of a cooperating broker's commission from the sale of certain real estate.

The facts are largely undisputed. On June 4, 1985, plaintiffs, the Luvisis, filed a complaint against defendants, the Joves, for an accounting and other relief in connection with the ownership and management of five parcels of property, including an apartment building on Ridge Avenue in Evanston, Illinois, which had been placed in trust for the parties by their parents, George and Francis Jove. On July 22, 1986, the trial court ordered that the Ridge property be listed for sale at a price at least 10% more than the appraised value, which was $1 million, and appointed Larry Starkman and Associates (Starkman) as the exclusive broker for the sale.

It appears that Starkman listed the property with two multiple listing services, one of which was the North Shore Multiple Listing Service, and that the listing agreement provided for payment of a 2 1/2% commission to a cooperating broker who secured a purchaser. The property was brought to the attention of Cameel Halim, the owner and president of intervening plaintiff, Wilmette Real Estate and Management Co. (Wilmette), by Anthony Davidson, who worked as a salesperson for the real estate brokerage firm of Hallmark & Johnson, which was acquired by Starkman in July 1986. According to Halim's affidavit, he informed Davidson of his intent to use Wilmette as his broker if he purchased the property and was told by Davidson that Wilmette would then receive the 2 1/2% commission.

On September 8, the Joves petitioned the court to approve the sale of the property to the individual -- Michael Aufrecht -- whose offer was the highest of the three received to that date. However, on that same day, June Luvisi submitted an offer higher than Aufrecht's and, on September 10, petitioned the court for approval of the sale to her. On September 16, Wilmette submitted a sealed-bid offer, the amount of which is unknown because, for reasons not appearing in the record, the bid was never opened. The next day, Robert Jove tendered an offer for an amount higher than Luvisi's and also filed a motion for approval of the sale to him. The motions were continued until October 1, 1986, by which date a total of nine offers had been received. Of those, five -- including those made by Luvisi and Jove -- met or exceeded the minimum price set by the court, three were for lesser amounts and one, Wilmette's, was, as noted above, for an unknown amount.

At the proceedings on October 1, the trial court entered an order agreed to by the parties providing for an orderly final sale of the property for the highest bid above the amount already offered by Jove by means of a public auction. The order further provided that the sale would be for cash and subject to those and only those terms contained in a court-approved real estate sales contract to be made available for inspection to all interested persons. Pursuant to the court's order, notice of the sale was placed in two local newspapers throughout the following month. The auction was conducted in the trial court's conference room on November 7. Present as bidders were Jove, Luvisi, Aufrecht and Halim, who was accompanied by his attorney, and two individuals who had not previously submitted offers for the property. Prior to commencement of the bidding, the attorney conducting the auction read the terms of the sale as set forth in the advertised notice, circulated copies of the approved sales contract and invited questions from the participants. Bidding was conducted in a round-table manner and continued until all bidders submitted their final offers. Halim emerged as the successful bidder and immediately thereafter he and the parties executed the sales contract, following which an order was entered confirming the sale.

On November 13, 1986, the trial court entered an agreed order providing for Starkman to "receive as compensation, in lieu of an hourly rate, for assisting the parties at the auction . . . and also in lieu of any other compensation for its sales efforts . . . the amount of $42,750, payable at the closing of the sale of the property." On November 18, Wilmette was granted leave to file a two-count intervening complaint for payment of $35,635, an amount equaling 2 1/2% of the purchase price, plus costs and interest for acting as the "selling broker" in the transaction.

In claiming entitlement thereto, Wilmette alleged in count I that it was Halim's broker and the procuring cause of the sale. Count II, which was directed only against Starkman, alleged that on several occasions prior to the sale, Halim had been promised by Davidson that if Halim purchased the property, Wilmette would receive the 2 1/2% commission and that it, and Halim, had relied on those promises in setting the final amount bid for the property.

The Luvisis and Joves filed motions to dismiss, asserting lack of privity of contract and that the provision for payment of a broker's commission had been clearly stricken from the sales contract executed by Halim. Starkman filed a motion for summary judgment on the grounds that because the property was sold by way of a court-ordered public auction, the terms of the listing agreement did not apply; that no broker's commission was provided for in the notice of the sale or in the real estate contract, the commission provision having been clearly lined out of the contract; and that since Halim had executed a fully integrated written contract evidence concerning other, prior agreements and/or oral representations was barred by the parol evidence rule. Following argument by counsel at a hearing on April 13, 1987, the court granted the ...

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