APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY. HONORABLE LESTER FOREMAN, JUDGE PRESIDING.
The Honorable Justice T. O'brien delivered the opinion of the court: Cousins, P.j., and Gordon, J., concur.
The opinion of the court was delivered by: O'brien
JUSTICE T. O'BRIEN delivered the opinion of the court:
Plaintiffs appeal from separate orders of the circuit court dismissing with prejudice their claims for promissory estoppel. The trial court held that plaintiffs could not invoke promissory estoppel while simultaneously seeking relief for breach of express contract. Under the facts and circumstances of this case, we affirm.
Because the trial court dismissed each of the counts in question pursuant to § 2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 1992)), the factual allegations in the complaint are taken as true.
Plaintiffs are limited partners in defendant Sunbelt Properties, Ltd. (Sunbelt Properties), an Illinois partnership established in 1981 for the purpose of purchasing and developing real estate. Defendant UDC Advisory Services, Inc. (UDC Advisory) serves as the general partner of Sunbelt Properties and is a wholly owned subsidiary of defendant UDC-Universal Development L.P. (UDC). Defendant UDC is itself a limited partnership engaged primarily in the development of land and the construction of housing projects in connection with planned communities.
Beginning in or before 1981, UDC Advisory solicited plaintiffs to become investors in, and limited partners of, a venture known as Sunbelt Properties. The solicitation consisted of oral representations as well as written documents referred to collectively as the offering materials. The two most relevant documents were the "Confidential Memoranda" dated July 2, 1981 and the "Progress Report and Supplement to Confidential Memorandum" dated October 9, 1981.
As stated in the offering materials, the purpose of Sunbelt Properties was to acquire large tracts of undeveloped, multi-zoned real estate with capital contributed by the limited partners. The partnership would then retain UDC to develop the real estate into residential or commercial projects for the benefit of the partnership. In turn, the partnership would provide UDC with the option of purchasing certain real property owned or acquired by the partnership at a price to be determined by a formula set forth in the offering materials. The offering materials further contemplated that the formula price could result in a sale below the fair market value of the property.
Specifically, the Confidential Memorandum provided in pertinent part:
"Sales of Real Estate; Rights of UDC. UDC will have the right to acquire from the Venture any and all of the properties acquired by the Venture which in the judgment of UDC are suitable for residential development, at a price equal to the sum of (i) the indebtedness to which such designated property is subject, plus (ii) all of the cash invested by the Venture to carry such designatedproperty, plus (iii) 10% per annum times the cash invested by the Venture in such designated property (measured from the date of such investment). UDC's right to acquire the designated property for the specified price may result in acquisitions by UDC below the fair market value of such property at the times of such acquisitions.
The foregoing rights of UDC with respect to property which it deems suitable for residential development will not extend to property acquired by the Venture suitable for other development, such as properties suitable for commercial development, or income-producing properties held by the Venture."
The Progress Report and Supplement to Confidential Memorandum subsequently modified the formula for calculating the purchase price as well as the class of property to which it applied. The Progress Report stated in relevant part:
"Acquisition Rights of UDC. UDC may purchase property planned and to be used for residential development ("residential real estate") from the Venture pursuant to the rights described in "Proposed Activities - Sales of Real Estate; Rights of UDC" in the Memorandum. Such rights, which may be exercised in part and from time to time prior to expiration, shall have the following terms:
Formula Price. The formula price at which UDC may acquire any residential real estate from the Venture shall be equal to the sum of (i) the indebtedness to which such residential real estate is subject, plus (ii) all of the net cash expended or invested by the Venture to acquire and carry such residential real estate being acquired by UDC, plus (iii) 10% per annum times the cash expended or invested to acquire or carry such residential real estate (measured from the date of expense or investment).
Residential Zoning: UDC shall have the right to acquire from the Venture at the formula price only real estate that has been zoned for residential uses ...