APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY. HONORABLE EDWARD C. HOFERT, JUDGE PRESIDING.
Presiding Justice McNAMARA delivered the opinion of the court: Egan and Zwick, J.j., concur.
The opinion of the court was delivered by: Mcnamara
PRESIDING JUSTICE McNAMARA delivered the opinion of the court:
Defendant, Murray Weinberg, appeals from an order of the circuit court of Cook County which denied his motion to vacate and set aside a settlement agreement order entered on April 12, 1993 and directed him to pay additional interest of $575.33 on a portion of the settlement amount due plaintiffs, Phillip Solar, Roberta Lewis-Solar, and Allen Bolnick. Defendant contends that the trial court erred in refusing to grant his motion where plaintiffs materially breached the agreement by failing to deliver a quitclaim deed to him upon receipt of the full settlement amount. He also contends that the court erred in ordering him to pay plaintiffs the additional interest where nothing in the parties' agreement obligated him to do so.
The relevant facts are as follows. In July 1985, plaintiffs and defendant formed a real estate partnership for the primary purpose of purchasing, owning, operating, and selling a multi-unit apartment building in Chicago. The parties entered into a written partnership agreement and became general partners. In accordance with the agreement, defendant was to act as managing partner. The partnership purchased the subject property on July 1, 1985, for $718,000.
In April 1991, plaintiffs filed an action against defendant in the circuit court of Cook County alleging fraud and breach of fiduciary duty. Plaintiffs contended that defendant induced them to sell the partnership property by falsely telling them that the venture was not as profitable as anticipated and recommending that the property be disposed of quickly. Relying on this information, plaintiffs agreed to sell the property in May of 1986 for $900,000. Plaintiffs alleged that the named buyer of the property was actually a "straw man" working for defendant, the real purchaser in interest, and that the property was worth considerably more than defendant had let on. Plaintiffs further alleged that defendant had engaged in impermissible acts of self-dealing and defrauded them out of a certain brokerage commission in connection with the sale. Plaintiffs sought rescission of the sale as well as an accounting, damages, and other relief against defendant.
Weinberg answered the complaint denying that he had engaged in any fraudulent activity or acts of self-dealing and filed five affirmative defenses and a three-count counterclaim. Plaintiffs subsequently moved for judgment on the pleadings and moved to strike all of defendant's affirmative defenses. In June of 1992, the trial court entered an order granting plaintiffs' motion for judgment on the pleadings on the issue of liability, striking defendant's affirmative defenses on the ground that they were insufficient in law and dismissing with prejudice counts I and II of his counterclaim.
On November 4, 1992, the trial court entered a written order holding that defendant had owed plaintiffs a fiduciary duty to obtain their informed consent before causing the subject property to be sold to himself. The court found that defendant breached that duty, and plaintiffs were therefore entitled to rescind the sale and to receive an award of compensatory and punitive damages.
On February 3, 1993, the case proceeded to trial on the issue of damages. On February 4, the parties, with the assistance of the trial judge, reached a settlement agreement, the terms of which were spread of record as follows:
"MR. BECKER [Plaintiffs' attorney]: The terms of the settlement are that the defendant will pay to the plaintiffs the following sums at the following times: Within seven days from today, $70,000. Within 14 days from today, an additional, $80,000. Within 30 days from today, $350,000, which would be $500,000 within no later than 30 days from today within the same time constraints that I have just described to the Court. Those time constraints are of essence and cannot be changed except by consent of all.
Concurrent with the payment of within 30 days that -- what I'm going to call the first $500,000, your Honor, the defendant will cause to be delivered to me an irrevocable, unconditional letter of credit by any state or federal bank in the State of Illinois, County of Cook -- no, metropolitan area. Although we didn't negotiate that, I don't want to confine him to the bank he wants to use -- in the sum of $515,000 payable no later than six months from the 30 days from today.
Concurrent with the delivery of the letter of credit and the payment of the $350,000, I will cause to be delivered to such person as [defendant's attorney] directs me to a document acceptable in form to them releasing the lis pendens on file with regard to the property which is the subject matter of this case.
In addition to that, your Honor, or in the event that the payments and letter of credit that I have described are not -- the payment is not made or the letter of credit is not delivered, then at the option of the plaintiffs and only at the option of the plaintiffs, then the agreement of the parties may be canceled and the case may resume if the plaintiffs so choose.
If, however, the defendant performs as I have suggested he will perform, then we will enter an order 31 days from today ...