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March 18, 1994


Appeal from the Circuit Court of Cook County. The Honorable Stewart Spitzer, Judge Presiding.

Egan, McNAMARA, Giannis

The opinion of the court was delivered by: Egan

PRESIDING JUSTICE EGAN delivered the opinion of the court:

This is a case of a purported agent who executed two leases for the same property in a land trust for the same period of time. The plaintiff, Yale Tavern, Inc. (Yale), is the lessee under one lease and the defendant, Ora-Don, Inc. (Ora-Don), is the lessee under the second lease. Yale filed a forcible entry and detainer action against Ora-Don and several other defendants. At the close of the plaintiff's case in a bench trial, the Judge entered judgment in favor of all defendants. The plaintiff contends that the Judge decided the case on an improper basis.

The building at issue, which contains a tavern, is located at 3332 West Irving Park in Chicago and is owned by an Illinois land trust. The trustee is a defendant, Cosmopolitan National Bank (Trustee) and the beneficiaries are Debra Dedich (Dedich) and Marlene Dedich.

The trust agreement provides that the Trustee has no duty regarding the management of the building, but "will deal with said property only when authorized in writing to do so" by the beneficiaries or by "such other person or persons as shall be from time to time named in writing by the beneficiaries." It also provides that the beneficiaries "shall have the full management of [the building] and control of the selling, renting and handling thereof."

In 1985, Dedich gave a written direction to the Trustee authorizing the Trustee to lease the building to a corporation, 3332, Ltd. She also gave Frank Micoli, the building manager, a written power of attorney authorizing him to "sign and abide by the lease with 3332, Ltd." This lease was executed by Micoli, the Trustee, and 3332, Ltd. 3332, Ltd. took possession of the property and began operating a tavern, the E & J Lounge, in November, 1985. The lease term ran until October 31, 1990. On February 16, 1990, an attorney retained by Micoli filed a forcible entry and detainer action against 3332, Ltd., claiming approximately $2,500 in past-due rent plus accrued rent for February, 1990.

Micoli and the Trustee then executed two different leases for the building. One was with Yale, and the other was with Ora-Don. In February, 1991, Yale filed a forcible entry and detainer action against Ora-Don, the Trustee, Debra Dedich, Frank Micoli, an alleged agent of Dedich, and Frank Jasper, an employee of Ora-Don. Marlene Dedich was not named as a defendant. The complaint did not cite any section of the Forcible Entry and Detainer Act (Ill. Rev. Stat. 1991, ch. 110, par. 9-101 et seq.), but alleged that "the defendants unlawfully withhold possession" of the building from Yale and that Micoli was the agent of Dedich "through a written power of attorney attached as Exhibit A." The 1985 power of attorney from Dedich toMicoli regarding the 3332, Ltd. lease is Exhibit A. The complaint further alleged that Micoli, the Trustee, and Dedich granted possession of the building to Yale in a lease but "the defendant" locked Yale out of the building. The complaint requested an order granting Yale possession of the building.

Dedich and Jasper never appeared or answered the complaint; all other defendants answered and participated in the defense. The record includes an order granting Micoli and the Trustee's attorney "leave to amend [their] response to include Debra Dedich." But, no answer by Dedich or amended pleading was filed. In this court, she is represented by the attorney for Micoli and the Trustee.

Both the Yale lease and the Ora-Don lease were admitted into evidence at the bench trial held on Yale's complaint. Both were executed for the purpose of running a tavern in the building. The Yale lease is dated March 21, 1990 and has a term beginning May 1, 1990. The lessor is the Trustee. The lease is signed by Micoli as "agent of lessor," the Trustee "as trustee," and Jess Yale, the president of Yale. At the bottom of the lease, the Trustee added a typed paragraph stating that the lease is subject to the trust agreement and that it executed the lease "in the exercise of the power and authority conferred upon it [in the trust agreement] * * * and under the express direction of the beneficiaries." There is also a rider attached to the lease explaining that the rent should be paid to Micoli and that Micoli "represents that [he] has a valid certificate proving Power of Attorney for [the Trust]." The parties agree that no power of attorney or written direction to the Trustee was executed regarding this lease.

Similarly, there was no power of attorney executed for the Ora-Don lease. Micoli sent a written direction to the Trustee to execute the Ora-Don lease, which he signed "pursuant to Power of Attorney of Debra Ann Dedich." This direction is dated June 26, 1990. The Ora-Don lease is dated March 20, 1990, however, and also has a term beginning May 1, 1990. Again, the Trustee is the lessor. The lease is signed by Martin Henning, the president of Ora-Don, and Micoli as "authorized agent per power of attorney." The line for the Trustee's signature is blank, and there was no evidence that the Trustee ever signed Ora-Don's lease. The lease lists Ora-Don as an Illinois corporation with a named registered agent. Ora-Don's president could not remember exactly when Ora-Don was incorporated but testified that it was "almost a year" before the April 29, 1991 hearing. Yale introduced a document from the Secretary of State listing the date of Ora-Don's incorporation as September 13, 1990.

Yale called Micoli as an adverse witness. Micoli explained that he lived over the tavern and had managed the building for Dedichfor approximately 28 years. He had a new roof installed on the building, had siding put on the building and rented it to many tenants over the years. He collected the rent and dealt with potential tenants. Further, he "took action" to remove 3332, Ltd. from the building. After he signed the lease with Yale, the forcible entry complaint against 3332 Ltd. was dismissed.

Micoli admitted signing the Yale lease; he was present when the Trustee signed the Yale lease on March 23, 1990. He and David Leader, Yale's stepfather and the man with whom Micoli negotiated the Yale lease, went to the bank together to obtain the Trustee's signature. He did not meet Jess Yale, the president of Yale, until the hearing. He first testified that "subsequent to" executing the Yale lease, he signed the Ora-Don lease, and admitted that he signed the Ora-Don lease on June 26, 1990. He later testified that the Ora-Don lease was prepared in January, 1990, before the Yale lease, although the Yale lease was signed before the Ora-Don lease. Then he said that the Ora-Don lease was signed first, a "day or two before" the Yale lease. He was never asked to explain why he signed both leases.

On March 23, 1990, Micoli deposited a $5,000 check, payable to him, into the building account. The check lists Jess Yale as the remitter. Micoli testified that Leader gave him this check and that it was for past-due water bills and rent payments owed by the E & J Lounge, for which the eviction suit against 3332, Ltd. was filed. He said the check had "nothing to do with the Yale lease." Micoli had discussed the eviction case with Leader, who owned an amusement company. He believed Leader gave him the $5,000 so that Leader could install his amusement machines in the building. Micoli testified that the amount owed by the E & J Lounge was $5,000, although the ...

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