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04/03/89 Park Plaza, Inc., v. Lincolnland Properties

April 3, 1989

PARK PLAZA, INC., PLAINTIFF-APPELLANT

v.

LINCOLNLAND PROPERTIES, INC., ET AL., DEFENDANTS-APPELLEES



APPELLATE COURT OF ILLINOIS, THIRD DISTRICT

540 N.E.2d 789, 185 Ill. App. 3d 26, 132 Ill. Dec. 867 1989.IL.471

Appeal from the Circuit Court of Peoria County; the Hon. Donald C. Courson, Judge, presiding.

APPELLATE Judges:

PRESIDING JUSTICE WOMBACHER delivered the opinion of the court. HEIPLE and STOUDER, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE WOMBACHER

The plaintiff appeals the trial court's order dismissing its complaint and cause of action with prejudice.

In March of 1967, Russell Lesperance (hereinafter Lesperance), a shareholder in several corporations owning seven apartment complexes, contacted W. Joseph Gibbs (hereinafter Gibbs) concerning the sale of these properties. Gibbs was the principal incorporator of Lincolnland Properties, Inc. (hereinafter Lincolnland), the defendant herein.

Lincolnland Properties, Inc., contracted to purchase seven apartment projects from Lesperance. Two apartment projects in question were situated in Peoria County, Illinois, and were commonly known as Golfview 42 and Golfview 24, and are the subject of this appeal. Lincolnland executed a $60,000 promissory note for Golfview 42 and a $30,000 note for Golfview 24 to the seller. Subsequent to the execution of these promissory notes, the corporate sellers assigned their interest in all these properties to Ginkids Investments, Inc. The plaintiff, Park Plaza, Inc. (hereinafter Park Plaza), is the successor to Ginkids Investments, Inc.

Lincolnland believed it could not operate the apartment properties without refinancing a second mortgage on several of the properties in question through Lesperance. If refinancing could not be obtained by Lesperance by March 1, 1968, some of the properties in question were to be paid by applying one-half of the net cash flow to the purchase price according to a modification agreement executed on October 5, 1967. Lesperance could not obtain a refinancing commitment and refused to acknowledge the validity of the October 5, 1967, agreement. Lincolnland commenced an action in Sangamon County, known as Lincolnland v. Butterworth, case No. 179 -- 69, to enforce the provisions of the October 5, 1967, agreement.

The trial court upheld the validity of the agreement of October 5, 1967, and also found that Lincolnland paid the notes on several of the properties (not including Golfview 24 or Golfview 42) in accordance with the October 5, 1967, agreement. The court also ordered Lincolnland to pay the holders of the notes covering Golfview 24 and Golfview 42, which Lincolnland did and acquired title to same. The Sangamon County circuit court's decision was upheld by the Fourth District Appellate Court in Lincolnland Properties, Inc. v. Butterworth Apartments, Inc. (1978), 65 Ill. App. 3d 907, 382 N.E.2d 1250.

On December 3, 1984, Park Plaza filed suit in Peoria County, the subject of the present appeal. Lincolnland responded with a "Motion to Dismiss or in the Alternative, to Transfer Venue." The Sangamon County circuit court issued a permanent injunction on March 21, 1985, enjoining Park Plaza from proceeding with this action in Peoria County. The court held that all the rights and liabilities between the parties, including those pertaining to Golfview 24 and Golfview 42, as well as the contracts, notes, agreements, and payment rights pertaining thereto, have been fixed by previous decisions of the Sangamon County circuit court. The Fourth District Appellate Court dismissed the appeal of this injunction for lack of jurisdiction. Thereafter, the Sangamon County circuit court issued a final order resolving the remaining issues in this cause and held Park Plaza was the alter ego of the other plaintiffs who filed suit throughout Illinois and should be treated as the same entity. The permanent injunction remained in effect indefinitely.

This injunction barred all similar proceedings against Lincolnland within and without Illinois. The subsequent causes of action, including the Peoria County action, are barred by res judicata and collateral estoppel.

The circuit court of Peoria County dismissed Park Plaza's complaint because Park Plaza could not establish it was not subject to the permanent injunction of the Sangamon County circuit court. Park Plaza contends the Sangamon County circuit court's order of March 21, 1985, should not prohibit the Peoria County action from proceeding. We disagree and affirm the circuit court of Peoria County.

In each case filed against Lincolnland subsequent to the issuance of the permanent injunction, the plaintiffs, including Park Plaza, have been held to be the alter ego of Ginkids Investments, Inc., the assignee of the original owners. Park Plaza was also a party to an appeal from which a final order barred it from proceeding with a similar action. The Sangamon County circuit court found that the Peoria County action is also ...


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