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08/17/95 FIRST CHICAGO GARY-WHEATON BANK v. ROBERT

August 17, 1995

FIRST CHICAGO GARY-WHEATON BANK, PLAINTIFF AND COUNTERDEFENDANT-APPELLEE,
v.
ROBERT A. GAUGHAN, DEFENDANT AND COUNTERPLAINTIFF-APPELLANT.



The Honorable Justice Hutchinson delivered the opinion of the court: Inglis and Doyle, JJ., concur.

The opinion of the court was delivered by: Hutchinson

MODIFIED UPON PETITIONS FOR REHEARING

The Honorable Justice HUTCHINSON delivered the opinion of the court:

Defendant, Robert A. Gaughan, appeals the judgment of the circuit court of Du Page County in favor of plaintiff, First Chicago Gary-Wheaton Bank. We affirm in part, modify in part, and remand.

On March 20, 1987, defendant purchased a 1987 Porsche 911 Turbo (vehicle) from Lynch Imports. Defendant purchased the vehicle for $69,000. Defendant made a $30,000 down payment on the vehicle and financed the remaining balance. Defendant entered into a retail installment motor vehicle contract (installment contract) whichwas assigned to plaintiff. The installment contract provided for 60 monthly payments of $1,068.81 which were due on the 19th of each month. However, in the event that defendant failed to make his payment on the 19th of the month, there was a provision whereby he could make a payment of $1,073.81 on or after the 30th of each month. The installment contract commenced on April 19, 1987. The total amount financed was $45,944.50. The total finance charges were $18,184.10. Thus, had defendant made all 60 payments, he would have paid a total of $64,128.60.

The majority of payments were made by Julie Gaughan, defendant's wife, and were usually late. In March 1990, defendant was behind by four payments and plaintiff turned the matter over to its attorney, Lawrence Friedman, for collection.

Mr. Friedman contacted defendant, informing him that he was in arrears on his payments. Defendant's wife then made four payments on March 27, 1990. However, on March 16, 1990, Mr. Friedman had filed a complaint in detinue on behalf of plaintiff against defendant in Cook County. The complaint alleged that because defendant was in default plaintiff was entitled to possession of the vehicle. Plaintiff demanded the return of the vehicle or its value and compensation for what it alleged to be defendant's unlawful use of the vehicle in the amount of $50 per day. The Cook County action was subsequently dismissed without prejudice.

Defendant was late in making his April and May 1990 payments, but on June 12, 1990, they were paid. On June 15, 1990, the June payment was made. On August 15, 1990, the July and August payments were made. On October 22, 1990, the September and October payments were made. Lastly, on November 28, 1990, the November payment, or payment number 44, was mailed by defendant to plaintiff's counsel. The payment was remitted to plaintiff and was posted on November 30, 1990.

On November 29, 1990, plaintiff hired new attorneys and filed the present complaint against defendant in Du Page County. The complaint contained two counts: (1) a replevin action which demanded the return of the vehicle; and (2) a contract action which sought the collection of the original installment amount. On December 20, 1990, plaintiff obtained an emergency ex parte order for forcible entry and, on that same day, executed that order, thereby repossessing the vehicle.

Plaintiff admitted that it did not comply with the notice provisions of the Motor Vehicle Retail Installment Sales Act (the Sales Act)(815 ILCS 375/1 et seq. (West 1992)). Plaintiff failed to inform defendant, within three days of the repossession, of his right to cureany default and restore his rights under the installment contract. Rather, plaintiff sent defendant two separate notice-of-intent-to-debtor packets; the first was dated January 9, 1991, and the second was dated September 3, 1991. The first packet informed defendant that he was in default under the terms of the installment contract because he had failed to make the October 1990 payment, as well as all subsequent payments. The second packet declared that defendant was in default for having failed to make the March 1990 payment, as well as all subsequent payments.

Defendant responded to each packet with an affidavit of defense. Each affidavit indicated that defendant was not in default and that the vehicle was taken pursuant to an invalid order of replevin. However, on February 15, 1991, in an attempt to get title to the vehicle from the Secretary of State, John W. Heffernan, plaintiff's employee, signed a written affidavit of repossession which incorrectly indicated that plaintiff had not received any affidavit of defense from defendant.

While the vehicle was in plaintiff's possession, it was stolen and damaged. The cost to repair the vehicle was estimated to be $12,870 in November 1991. Plaintiff concedes that it is responsible for the damage to the vehicle.

Defendant filed a motion to quash the alleged services of the replevin notices, writ of replevin, and summons. The motion was granted on February 21, 1991. Service was properly had on April 12, 1991. Defendant filed a motion to dismiss both counts of plaintiff's complaint. As to count I, defendant argued that a replevin action cannot lie where plaintiff was already in possession of the property. As to count II, defendant filed a section 2-615 motion (735 ILCS 5/2-615 (West 1992)) to strike count II as being vague and indefinite. Plaintiff voluntarily struck count I and the court struck count II as being vague.

Plaintiff filed an amended complaint, alleging breach of the installment contract. Plaintiff alleged that defendant breached the contract by failing to make payments when due and by failing to keep the vehicle fully insured. Defendant denied breach and argued that plaintiff failed to give appropriate notice pursuant to section 20 of the Sales Act (815 ILCS 375/20 (West 1992)). Defendant filed four affirmative defenses, alleging (1) promissory estoppel/waiver in accepting the late payments and failing to object to the insurance issue; (2) violation of the Sales Act in failing to give the required notice; (3) a setoff for damages caused to the vehicle; and ...


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