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07/15/94 H & H PRESS v. DREW AXELROD AND AMY

July 15, 1994

H & H PRESS, INC. AND MARY HAMMOND D/B/A THE LEFEBRE CO., PLAINTIFFS-APPELLEES,
v.
DREW AXELROD AND AMY AXELROD A/K/A AMY KULEK, D/B/A TRADEXPO, INC., DEFENDANTS-APPELLANTS.



Appeal from the Circuit Court of Cook County. The Honorable Janice R. McGaughey, Judge Presiding.

Released for Publication August 25, 1994.

Giannis, Egan, McNAMARA

The opinion of the court was delivered by: Giannis

JUSTICE GIANNIS delivered the opinion of the court:

Plaintiffs instituted this action against defendants seeking damages for an alleged breach of an oral agreement. After a bench trial, the court found in favor of plaintiffs and entered judgment against defendants in the total amount of $20,945.69. The order entered by the court held further that defendant Amy Kulek a/k/a Amy Axelrod was personally liable for the judgment. Defendants appeal, claiming that the trial court erred in (1) admitting into evidence photocopies of plaintiffs' business ledger book, (2) denying defendants' motion for a finding in their favor based upon the plaintiffs' failure to respond to the factual allegations contained in defendants' affirmative defenses, (3) entering judgment in favor of plaintiffs despite the fact that no evidence was introduced to establish the reasonable market price for the work performed by plaintiffs, (4) finding that defendant Amy Kulek a/k/a Amy Axelrod was an officer of TradExpo, Inc., and (5) finding that defendant Amy Kulek a/k/a Amy Axelrod was personally liable for the judgment in favor of plaintiffs.

The record reveals that plaintiffs filed a verified complaint in the Municipal Division of the circuit court of Cook County seeking payment for printing services for defendants. Plaintiffs alleged that defendants had agreed to pay $22,831.73 for the printing services provided by plaintiffs. Count I of the complaint requested damages in the amount of $15,326.69, and Count II sought damages in the amount of $5,752, for a total of $21,078.69, which represented the unpaid balance under the agreements. Attached as exhibits to the complaint were photocopies of certain statements issued by plaintiffs to defendants for work done from February through April 1992.

Because no verbatim transcript of the trial was available, the record contains an agreed report of proceedings pursuant to Supreme Court Rule 323(d) (134 Ill. 2d R. 323(d)). The evidence adduced at trial established that from February 1992 until the end of April 1992, the plaintiffs performed certain printing work for defendants who did business as TradExpo, Inc. TradExpo, Inc. had been involuntarily dissolved on January 2, 1991, for failure to file its annual report and to pay the franchise tax for 1990. Defendants were unaware of the involuntary dissolution until September 1992, when the instant cause of action was brought against them personally. Counsel for defendants effected the reinstatement of the corporation after the filing of plaintiffs' complaint.

According to the agreed report of proceedings, the three witnesses called by the plaintiffs were Howard Hammond, Mary Hammond, and Amy Kulek a/k/a Amy Axelrod, one of the defendants, who was examined as a hostile witness pursuant to Supreme Court Rule 238 (134 Ill. 2d R. 238). The exhibits presented by plaintiffs consisted of 31 documents which were marked "A" through "AE" and which were admitted into evidence upon examination of Howard Hammond, president and keeper of the records of H & H Press, Inc., and of Mary Hammond, keeper of her own records. These exhibits included photocopies of invoices for work done by plaintiffs for defendants as well as copies of notes and orders from defendants and copies of the printing work actually done by plaintiffs.

Defendants objected to the admission of exhibit "W" which consisted of two pages and which purported to be photocopies of the relevant pages in the permanent ledger book of H & H Press, Inc. Defendants' objection was predicated upon hearsay and upon plaintiffs' failure to produce the original ledger entries in accordance with the "best evidence rule." After counsel for defendants raised this objection, plaintiffs' attorney inquired of Howard Hammond, the witness, "the original record is large and heavy, is it not?" Hammond answered, "yes." No further objection was raised by defendants. Defendants also objected to the admission of plaintiffs' exhibit "V" which was a two-page statement dated June 4, 1992, from H & H Press, Inc., to TradExpo, Inc. Defendants' objection to this exhibit was based upon hearsay and upon the claim that the statement was self-serving. Although the agreed report of proceedings does not reflect the trial court's rulings on defendants' objections to these exhibits, the ledger pages and the statement contained in exhibits "V" and "W" were ultimately admitted into evidence.

Howard Hammond testified that there was no written agreement between H & H Press, Inc. and defendants, but that he had done business with Drew Axelrod and Amy Kulek since March 1991. Howard Hammond testified further that defendants rarely showed any concern for price; the prices charged defendants were at or slightly below market price; each invoice was delivered at the time the printing services were performed; where work was previously quoted, it was produced at the quoted price; and at no time after delivery did either defendant express any concern with price. Howard Hammond also testified that the procedure used in pricing the 10 disputed invoices was the same procedure used in pricing the previous 19 invoices which had been paid by defendants. Howard Hammond acknowledged that for some of the printing work performed for defendants, the prices indicated in the invoices had not been previously agreed to by the parties before the work was done. According to Howard Hammond, the defendants made the printing orders, and he did the work.

Plaintiff Mary Hammond testified that at the beginning of her business relations with defendants, Amy Kulek gave her a business card, admitted as plaintiffs' exhibit "AB," which reflected that Amy Kulek was "Vice President" of TradExpo, Inc. Mary Hammond testified further that the invoices admitted as plaintiffs' exhibits "Y" and "Z" were for color separation work which she had contracted out to a company called Classic Litho, to whom she had already made partial payments totaling $600 and to whom she remained indebted for the balance. Mary Hammond also stated that since April 22, 1992, Classic Litho had informed her that it had received a partial payment of $133 directly from the defendants without explanation, for which Mary Hammond's account had been credited. Mary Hammond testified further that the color separations done by Classic Litho were for the gourmet show book which was admitted as plaintiffs' exhibit "P." According to Hammond, the prices charged for the color separations were the market prices for such work and that neither defendant had objected to the prices charged. Mary Hammond also stated that several of the orders received by H & H Press, Inc. were placed by defendant Amy Kulek. On cross-examination, Hammond stated that although she had offered to quote prices to defendants, they were not interested in the price quotes and requested immediate production.

Defendant Amy Kulek admitted that she had given the business card admitted as plaintiffs' exhibit "AB" to Mary Hammond before she had any dealings with Hammond or with H & H Press, Inc. Kulek testified further that the business card had been incorrectly printed, and, if correctly printed, would have stated "Vice President of Sales" rather than "Vice President." Kulek also testified that she did not believe she was an officer of TradExpo, Inc., and that she carefully confined her activities to [use of] the telephone, selling, and meeting potential buyers. Kulek stated further that she did not know that the corporation had been dissolved until the commencement of the instant action.

Drew Axelrod testified that he was the president and sole officer of TradExpo, Inc., and that the company was an "officer-run" company, having no board of directors. Axelrod testified further that he had complained about the prices charged by plaintiffs but had not reduced his complaints to writing, and he could not recall when he had complained. Axelrod stated that when he learned that TradExpo, Inc., had been involuntarily dissolved, he directed an attorney toeffect reinstatement of the corporation. The annual reports for the years 1990, 1991 and 1992 were filed, and the corporation was reinstated after plaintiffs had commenced the instant litigation.

Drew Axelrod testified that there was no agreement, written or oral, for the work produced by either plaintiff. Axelrod stated further that he had made two payments of $5,000 each, and he produced copies of cancelled checks which documented these payments. Axelrod acknowledged, however, that no payment had ...


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