Appeal from the Circuit Court of Lake County. No. 92-L-988. Honorable Jack Hoogasian, Judge, Presiding.
Released for Publication July 19, 1994.
PECCARELLI, McLAREN, Doyle
The opinion of the court was delivered by: PECCARELLI
JUSTICE PECCARELLI delivered the opinion of the court:
In this real estate contract case, plaintiffs, Paige and Robert Giannetti, appeal the trial court's order granting summary judgment to defendant, Laila Angiuli. We reverse and remand.
On July 24, 1992, Paige and Robert Giannetti (plaintiffs or buyers) filed a complaint against defendant, Laila Angiuli (defendant or seller) for breach of contract and conversion. Plaintiffs sought to recover the $15,000 earnest money they deposited toward the purchase of a parcel of land owned by defendant. Defendant filed a counterclaim for breach of contract and also sought the award of the earnest money. Plaintiffs and defendant filed cross-motions for summary judgment; plaintiffs also filed a motion to dismiss defendant's counterclaim. On February 17, 1993, the trial court denied plaintiffs' motion for summary judgment and their motion to dismiss the counterclaim and granted defendant's motion for summary judgment. The court awarded defendant the sum of $15,000 plus the costs of suit; the order was filed on February 18, 1993.
Plaintiffs timely appeal, contending that (1) the trial court erred in allowing a forfeiture of the earnest money because the law does not favor forfeitures and a forfeiture would be inequitable in the present case; (2) the trial court should have applied the doctrine of estoppel (an affirmative defense) to prevent the forfeiture of the earnest money; and (3) the trial court erred in not finding that the principle of waiver precluded defendants from insisting on strict compliance with the terms of the real estate contract. The parties tendered cross-motions for summary judgment inferring there was no issue of a material fact. The trial Judge stated and the parties affirmed that the parties consented to have the matter conclude by a hearing for summary judgment rather than going to trial. We deem whether or not the parties conclude there was no issue of material fact and waive the issue is not for the parties to determine. The mere filing of cross-motions for summary judgment and the invitation to the trial court to decide the issue on the record does not establish there is no issue of a material fact. ( Andrews v. Cramer (1993), 256 Ill. App. 3d 766, 769, 195 Ill. Dec. 825, 629 N.E.2d 133.) As in all cases involving summary judgment, we review the evidence in the record de novo. (In re Estate of Hoover (1993), 155 Ill. 2d 402, 411, 185 Ill. Dec. 866, 615 N.E.2d 736; Outboard Marine v. Liberty Mutual Insurance Co. (1992), 154 Ill. 2d 90, 131-132, 180 Ill. Dec. 691, 607 N.E.2d 1204.) An appellate courtreviews summary judgment orders de novo. ( Schulenburg v. Rexnord, Inc. (1994), 254 Ill. App. 3d 445, 449, 193 Ill. Dec. 857, 627 N.E.2d 16; Demos v. National Bank of Greece (1991), 209 Ill. App. 3d 655, 659-60, 153 Ill. Dec. 856, 567 N.E.2d 1083.) We conclude that there existed genuine issues of material and disputed facts, making this case unsuitable for summary judgment. We therefore reverse the judgment and remand the cause for further proceedings.
The record reveals that, on March 5, 1992, the parties executed a real estate contract wherein plaintiffs agreed to purchase "lot 5" on South Ridge Road in Lake Forest, Illinois, for $150,000. The contract was subject to certain contingencies. Paragraph 2 stated in pertinent part:
"This contract is contingent upon the ability of the Purchaser to secure within 45 days of Seller's acceptance, a commitment for a loan evidenced by a note to be secured by a mortgage or trust deed on the real estate in the amount of 80% or such lesser amount as Purchaser shall accept, with a fixed interest rate not to exceed 9.5%.
If Purchaser makes a good faith effort but is unable to obtain a commitment for the mortgage loan contemplated herein, Purchaser shall so notify Seller in writing within the time specified in paragraph 2. IF SELLER IS NOT SO NOTIFIED WITHIN SUCH TIME PERIOD, PURCHASER SHALL FOR ALL PURPOSES BE DEEMED TO HAVE SECURED SUCH COMMITMENT OR TO HAVE AGREED TO PURCHASE THE REAL ESTATE WITHOUT MORTGAGE FINANCING OR BASED UPON THE MORTGAGE COMMITMENT ACTUALLY OBTAINED."
The agreement recited, among other things, that the closing date would be May 5, 1992. Initially, a check for $1,000 was deposited with the real estate broker as earnest money. Within 14 days of the seller's acceptance, 10% of the purchase price was to be deposited as earnest money. Paragraph 10 also stated in pertinent part:
"This contract is contingent upon the approval hereof as to form by the attorneys for Purchaser and Seller within 7 days after Seller's acceptance of this contract. Unless written notice of disapproval is given within the time period specified above, this contingency shall be deemed waived and this contract will remain in full force and effect. If written notice of disapproval is given within the time period specified above, then this contract shall be null and void and the earnest money shall be returned to Purchaser. The notice of disapproval may be given by either party hereto or by their respective attorney. For purposes of this contingency, the written notice of written disapproval must be personally delivered and shall be deemed given and be effective as of the date when such notice is received by Seller or by ListingBroker as agent for Seller, if such notice of disapproval is being made on behalf of Purchaser."
After the execution of the real estate sales agreement, attorney Thomas P. Egan was retained by the buyers to represent them. According to Egan's affidavit submitted in support of plaintiffs' motion to dismiss the counterclaim and for summary judgment, Egan learned on March 11, 1992, via facsimile transmission (fax) from Robert Giannetti that the seller was represented by attorney John Galley. In the affidavit, Egan also stated that he transmitted a notice of disapproval of the terms of the March 5 contract by fax to Galley, and the notice of disapproval consisted of the March 5 contract to which he attached a rider which he claimed substantially altered the terms of the March 5 agreement. He stated that he was not informed by the seller or Galley that his notice of disapproval was untimely or otherwise ineffective. Egan also stated that, on March 12, 1992, Galley telephoned him and stated his disapproval of the terms of the rider and that Galley would be adding his own rider to the rider Egan sent. On April 25, 1992, a copy of the rider with the signature of defendant was sent to the plaintiffs by their real estate broker which was then forwarded to Egan. The text of the rider contained handwritten changes from that drafted by Egan which were initialed by defendant alone. Egan then made further changes. He claimed that it was not until early May 1992 (later determined by the trial court to be April 29) that a rider with all the changes and an amendment to the rider were fully executed by all the parties.
The final version of the rider included terms related to the following issues: (1) the title commitment was to be provided at the seller's expense no later than 3 (rather than 15) days before closing; (2) the survey to be provided; (3) that seller would pay any county transfer tax; (4) if purchaser failed to close for any reason not excused by the contract, the seller's sole remedy would be retention of the earnest money; (5) the nature of the real estate agents' relationship to seller and purchaser; (6) representations regarding unrecorded easements, covenants, restrictions and zoning; and (7) representations regarding the absence of hazardous substances on the property. The amendment to the rider ...