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12/12/88 General Electric Credit v. Robert J. Jankuski Et Al.

December 12, 1988

GENERAL ELECTRIC CREDIT AUTO LEASE, INC., PLAINTIFF

v.

ROBERT J. JANKUSKI ET AL., DEFENDANTS AND COUNTERPLAINTIFFS-APPELLANTS (FIRESIDE



APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, FIRST DIVISION

Chrysler-Plymouth, Inc., Defendant and

Counterdefendant-Appellee)

532 N.E.2d 361, 177 Ill. App. 3d 380, 126 Ill. Dec. 676 1988.IL.1784

Appeal from the Circuit Court of Cook County; the Hon. Paul A. Koldoziej, Judge, presiding.

APPELLATE Judges:

JUSTICE QUINLAN delivered the opinion of the court. MANNING and O'CONNOR, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE QUINLAN

General Electric Credit Auto Lease, Inc. filed suit in the circuit court of Cook County against Robert and Ann Jankuski and Fireside Chrysler-Plymouth, Inc. (Fireside), for breach of contract concerning an auto lease. *fn1 The Jankuskis filed a countercomplaint against Fireside for fraud in the inducement. Fireside moved to dismiss the Jankuskis' second amended countercomplaint for failure to state a cause of action. The circuit court dismissed the Jankuskis' counterclaim with prejudice, and further, entered a finding that no just reason existed to delay enforcement or appeal of its order. The Jankuskis now appeal from that ruling.

The Jankuskis' second amended countercomplaint alleged the following: On April 8, 1984, the Jankuskis went to Fireside to purchase an automobile for their son, Robert Jr., who, at the time, was a member of the United States Armed Services and stationed in New York. They indicated that they wanted to lease a car, a 1984 Chrysler Laser, for their son, Robert Jr., who would, within a few days, execute a lease for the automobile. Additionally, the Jankuskis informed Fireside of the possibility that, during the term of the lease, Robert Jr. could be shipped overseas, outside of the continental United States. The representative of Fireside advised the Jankuskis that in order for Fireside to hold that particular vehicle, the Laser, until Robert Jr. actually executed the lease, the Jankuskis would have to sign a "holding agreement" for the Laser, which would be denominated as a lease agreement for a term of four years. However, the representative told the Jankuskis that when Robert Jr. came in to execute the lease, the "holding agreement" would become null and void and Robert Jr.'s lease would be the only effective agreement in existence. This representative further informed the Jankuskis that the "holding agreement" which they were to sign would impose no personal liability on either of them. As a result of these alleged misrepresentations, the Jankuskis then signed the lease on April 8, 1984. Furthermore, the Jankuskis asserted that the representative also told them that their son, Robert Jr., could not remove the vehicle from the continental United States, but, if he were transferred overseas, the Fireside representative said that the vehicle could then be returned to Fireside and that Robert Jr.'s lease would be cancelled. The representative stated that no further obligation would accrue to anyone by virtue of the terms of the lease agreements.

On April 10, 1984, Robert Jr. signed and executed a lease agreement with Fireside for the same vehicle which had previously been the subject of the form type lease or "holding agreement" earlier signed by his parents. Robert Jr. made all required lease payments on the vehicle until March 1, 1985, at which time he was transferred overseas. Thereafter, the vehicle was returned to Fireside, and, at that time, the Jankuskis alleged that they believed that all their obligations had been terminated.

The complaint further asserted that Fireside never meant to use the agreement as a "holding agreement," but that Fireside's false and fraudulent representations were intended only to induce the Jankuskis to enter into the "holding agreement," which Fireside actually intended to be a lease agreement. Finally, they alleged that Fireside always intended to turn their lease over to GECAL under Fireside's lease plan agreement, and that Fireside's representations were fraudulent and calculated to deceive and induce the Jankuskis into executing the so-called "holding agreement" which, as contended, was to be an additional lease document that, contrary to Fireside's assertions, would not be cancelled when their son executed his lease.

Initially, after the Jankuskis' first countercomplaint was filed, Fireside moved to dismiss it for failure to state a cause of action under section 2-615 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2-615). That motion was granted without prejudice, and the Jankuskis filed an amended countercomplaint. Fireside again moved to dismiss under section 2-615, and that motion was also granted without prejudice. The Jankuskis then filed a second amended countercomplaint, and Fireside again moved to dismiss under section 2-615. The trial court granted Fireside's motion and the second amended countercomplaint, as stated above, was dismissed with prejudice, denying the Jankuskis any further leave to amend. The Jankuskis now appeal this dismissal of their second amended countercomplaint.

The issue in this appeal is whether the second amended countercomplaint alleged a set of facts which, if assumed to be true, stated a cause of action for fraud in the inducement. The trial court found it did not and dismissed the second amended countercomplaint pursuant to section 2-615 of the Code of Civil Procedure for failure to state a claim upon which relief can be granted. (See Ill. Rev. Stat. 1987, ch. 110, par. 2-615.) However, a cause of action must not be dismissed on the pleadings unless it clearly appears that no possible set of facts exists which will entitle the plaintiff to recovery. (Charles Hester Enterprises, Inc. v. Illinois Founders Insurance Co. (1986), 114 Ill. 2d 278, 286, 499 N.E.2d 1319, 1322.) Where a motion to dismiss is filed pursuant to section 2-615 for failure to state a cause of action, all well-pleaded facts must be taken as true and any reasonable inferences drawn from those allegations must necessarily be construed liberally in favor of the complainant, because the motion to dismiss merely tests the legal sufficiency of the allegations; it is not a determination on the merits of the claim. See Hester, 114 Ill. 2d at 286, 499 N.E.2d at 1322; Bishop v. Ellsworth (1968), 91 Ill. App. 2d 386, 391, 234 N.E.2d 49, 52; Ill. Rev. Stat. 1987, ch. 110, par. 2-615.

Both parties argue that to state a cause of action for fraud, a plaintiff must assert: (1) that the defendant made a statement; (2) of a material nature; (3) which was untrue; (4) known by the person making it to be untrue, or made in culpable ignorance of its truth or falsity; (5) relied on by the victim to his detriment; (6) made for the purpose of inducing reliance; and (7) the victim's reliance led to his injury. (Brainerd v. Balish (1987), 164 Ill. App. 3d 836, 841, 518 N.E.2d 317, 320; see also Smith v. Jones (1986), 113 Ill. 2d 126, 133-34, 497 N.E.2d 738, 741.) Further, a person claiming to be a victim of fraud may also contend that he or she was induced to enter into the contract as a result of fraud and, accordingly, ask to have the contract rescinded and restitution ordered, i.e., seek to place the parties in the positions ...


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