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06/21/89 John L. Wubbolding, v. Ravinder P. Kundra

June 21, 1989




Before explaining any further details of evidence or the reasons for our decision, we consider a Discussion of the cases cited in support of the circuit court's decision to be desirable.


540 N.E.2d 1032, 185 Ill. App. 3d 104, 133 Ill. Dec. 166 1989.IL.952

Appeal from the Circuit Court of Champaign County; the Hon. George S. Miller, Judge, presiding.


JUSTICE GREEN delivered the opinion of the court. McCULLOUGH, P.J., and LUND, J., concur.


On March 25, 1988, plaintiff John L. Wubbolding brought suit in the circuit court of Champaign County against defendant Ravinder P. Kundra seeking monetary damages for defendant's alleged breach of a contract to purchase real estate from plaintiff. After issue was joined, the case was heard at bench. On November 1, 1988, the court entered judgment in favor of defendant in bar of action. Plaintiff has appealed. We reverse and remand for a determination of plaintiff's damages.

The evidence was undisputed that a contract for the sale of the real estate was entered into between the parties on February 13, 1987, providing for a purchase price of $199,300 with a down payment of $6,500 to be paid by March 1, 1987, and with a closing date of March 15, 1987, at which time the balance was due. The contract contained a provision making time "of the essence" of the contract. Under the pleadings, plaintiff's readiness and willingness to perform on the date of closing and thereafter is not disputed. Defendant agrees he did not make the payments required at any time. However, the evidence also showed defendant was having difficulty in obtaining financing, and plaintiff acquiesced in defendant not closing the purchase on the agreed date. The evidence also showed plaintiff never made a demand of defendant to pay the purchase price before filing suit on March 25, 1988.

The case turns upon whether plaintiff was required to make an actual demand on defendant for payment by a set date before bringing suit. The circuit court held plaintiff was required to do so and ruled in favor of defendant because plaintiff had not done so. Plaintiff maintains he was not required to make the demand because (1) the issue of demand was not raised by the pleadings; and (2) his repeated requests to defendant to close the contract in addition to a statement made on defendant's behalf by his agent made demand unnecessary. We hold that, under the circumstances shown by the evidence, no demand was necessary.

We dispose of plaintiff's assertion that the issue of demand was not raised by the pleadings summarily. The complaint alleged the making of a demand for payment, and defendant's answer denied the allegation. Plaintiff maintains that lack of a demand is an affirmative defense but cites no authority in support. His theory is contrary to the usual definition of an affirmative defense as one which "gives color to the opposing party's claim and then asserts new matter by which the apparent right is defeated." (Worner Agency, Inc. v. Doyle (1984), 121 Ill. App. 3d 219, 222, 459 N.E.2d 633, 635.) Moreover, the state of the pleadings negates plaintiff's contention he was taken by surprise. The issue of demand was clearly raised by the pleadings.

Plaintiff's second contention raises a more difficult question. Defendant seeks to draw analogy between the situation here, where plaintiff is merely seeking to recover the agreed purchase price under the contract, and situations where a vendor seeks to obtain a forfeiture of a down payment, to rescind a contract of sale, or to prevent being required to specially perform under such a contract. The circumstances here and those in the situations to which analogy is drawn all involve a failure of a vendee to pay the purchase price at the time set forth in a real estate contract, while the vendor has stood by and acquiesced in the delay of the vendee in making payment. The circuit court made this analogy in making its decision.

The circuit court relied most heavily upon the precedent of Hockenbury v. Lorentz (1976), 35 Ill. App. 3d 983, 343 N.E.2d 90. There, a vendor and vendee had contracted for a sale of realty for a price of $16,000. A down payment of $1,400 had been paid. One day after the execution of the contract, that vendee's attorney asked those vendors to rescind the contract because of that vendee's mental condition but the vendors refused. The closing date was set for August 10, 1973. On that date, the vendors warned the vendee they would take his down payment and resell the property if he failed to pay, but they did grant him an extension for making payment. The vendee wrote to the vendors on August 31 acknowledging the grant of the extension, which he stated he assumed to be for 30 days. The record did not indicate any further communication between the parties, but, after August 10, 1973, the vendors advertised the property for sale and sold it on September 27, 1973, to a third party. The vendee then filed suit for a return of the down payment. After a trial, the circuit court entered judgment for the vendors.

On appeal in Hockenbury, the appellate court reversed. It recited the court's abhorrence of forfeitures and noted all of the parties had intended for the vendee to continue to be seeking financing to make the purchase when the vendors advertised for the sale and made the sale. The court held the vendors' conduct constituted an offer to rescind, permitting the vendee to recover his down payment.

Defendant also cites Bell v. Yale Development Co. (1981), 102 Ill. App. 3d 108, 429 N.E.2d 894, where an assignee of a vendor sought to rescind a contract of real estate although that vendor had granted numerous extensions of time to make payment to that vendee. The appellate court held the vendor was entitled to a summary judgment of rescission upon repaying to the vendee the small down payment it had made. The vendor contended the vendee's conduct had indicated an intent to abandon the contract. The appellate court concluded that, on the basis of extensive correspondence between the vendee and the vendor, it could not find, as a matter of law, that the vendee had abandoned the contract. However, that court concluded the vendor had given the vendee a sufficient demand to perform with an ample length of time to do so that, upon the failure of the vendee to comply, the vendor was entitled to rescission as a ...

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