defendants had answered the complaint and been deposed, there still existed the possibility that they would admit the existence of the contract and thereby allow the plaintiff to seek refuge in the judicial admission exception to the statute of frauds, 810 ILCS 5/2-201(3)(b). 902 F. Supp. at 810-11.
The defendants have now denied the existence of the alleged agreements in their answer, as have Hudgens, Joyner, and Olson in their affidavits. Therefore, the defendants move for summary judgment on Count I, again arguing that ISC cannot satisfy the requirements of the statute of frauds. See DF Activities Corp. v. Brown, 851 F.2d 920, 922 (7th Cir. 1988) (concluding that statute of frauds issue could be resolved once defendant denies existence of the contract). The plaintiff does not directly confront the issue by arguing that Hudgens's handwritten notes satisfy the U.C.C.'s requirement of a writing, see Monetti, S.P.A. v. Anchor Hocking Corp., 931 F.2d 1178, 1181-85 (7th Cir. 1991), or that Emerle's fax message to Olson and Crane constitutes a written merchant's confirmation of the agreement under 810 ILCS 5/2-201(2). Instead, ISC contends that the defendants should be equitably estopped from denying the existence of the contract between the parties, since through their promises they induced ISC to expend time and money on the development of Restore Plus. However, a claim of equitable estoppel is raised in Count IV, and the defendants' challenge to that count is discussed below. In other words, the plaintiff offers no explanation independent of Count IV as to why the U.C.C.'s statute of frauds should not apply to the claims raised in Count I. Accordingly, as we see no justification for relaxing the requirements of 5/2-201, we grant the defendants' motion for summary judgment on the breach of contract claims in Count I. See Genin, Trudeau & Co. Ltd. v. Integra Dev. Int'l, 845 F. Supp. 611, 616-19 (N.D. Ill. 1994) (considering applicability of equitable estoppel in separate count of complaint, but dismissing separate breach of contract claim).
B. Count IV (Equitable Estoppel)
In Count IV of the Amended Complaint the plaintiff seeks to hold the defendants liable under a theory of equitable estoppel. ISC contends that the defendants repeatedly represented that if ISC successfully developed a formula for Restore Plus, they would purchase all of their requirements of the chemical for an unspecified period of time. Through these representations, ISC argues, the defendants induced ISC to spend considerable time and effort on the development of Restore Plus, and then took the formula from the plaintiff without compensating it for its efforts. At the outset we observe that notwithstanding its label, Count IV looks suspiciously like a claim of promissory estoppel--that is, a claim that ISC relied on the defendants' promise, that such reliance was reasonable and foreseeable, and that ISC was injured because of its reliance, see A-Abart Elec. Supply, Inc. v. Emerson Elec. Co., 956 F.2d 1399, 1404 (7th Cir.), cert. denied, 506 U.S. 867, 121 L. Ed. 2d 137, 113 S. Ct. 194 (1992). However, Illinois courts are reluctant to permit the use of promissory estoppel to recover on a contract claim that fails the statute of frauds. See Architectural Metal Sys., Inc. v. Consolidated Sys., Inc., 58 F.3d 1227, 1231 (7th Cir. 1995); Evans v. Fluor Distribution Cos., 799 F.2d 364, 368 (7th Cir. 1986); Dickens v. Quincy College Corp., 245 Ill. App. 3d 1055, 615 N.E.2d 381, 386, 185 Ill. Dec. 822 (Ill. App. Ct. 1993). Perhaps recognizing this uncertainty in Illinois law, ISC has tacitly disavowed any claim of promissory estoppel, instead styling Count IV exclusively in the language of equitable estoppel.
While it is true that a claim of equitable estoppel is not subject to the statute of frauds, Ceres Illinois, Inc. v. Illinois Scrap Processing, Inc., 114 Ill. 2d 133, 500 N.E.2d 1, 7, 102 Ill. Dec. 379 (Ill. 1986); Bradley Real Estate Trust v. Dolan Assocs. Ltd., 266 Ill. App. 3d 709, 640 N.E.2d 9, 12, 203 Ill. Dec. 582 (Ill. App. Ct. 1994), we conclude that under the facts of this case, ISC cannot avail itself of this doctrine. To prevail on a claim of equitable estoppel a plaintiff must prove (1) a misrepresentation or concealment of material fact, (2) the defendant's knowledge that the representations were false, (3) the defendant's intent or expectation that the representations be acted upon by the plaintiff, (4) actual reliance by the plaintiff, and (5) some injury or prejudice to the plaintiff if the defendant is allowed to deny the truth of the representations. See Bradley Real Estate, 640 N.E.2d at 12; M.J. Oldenstedt Plumbing Co. v. K Mart Corp., 257 Ill. App. 3d 759, 629 N.E.2d 214, 218, 195 Ill. Dec. 906 (Ill. App. Ct. 1994). Although the representation or conduct at issue need not be "fraudulent in the strict legal sense or done with an intent to mislead or deceive," the plaintiff must still demonstrate that "conscience and the duty of honest dealing" requires the defendant to be bound by its representations. Ceres, 500 N.E.2d at 7 (citation and alterations omitted); see also MACCOHN v. Checker Motors Corp., 233 Ill. App. 3d 839, 599 N.E.2d 1112, 1117, 175 Ill. Dec. 98 (Ill. App. Ct. 1992) (distinguishing equitable estoppel from promissory estoppel by noting that the former requires proof of "words or conduct amounting to a misrepresentation or concealment of material facts"). For example, the defendant in Ceres claimed that the plaintiff was equitably estopped from raising a statute of frauds challenge to its fifteen-year oral lease because the plaintiff had actively encouraged the defendant's development of a scrap-processing operation on the site. The Illinois Supreme Court rejected the argument because both parties had sufficient information as to the unenforceability of an oral lease, and the plaintiff's conduct did not constitute a "fraud or misrepresentation." Ceres, 500 N.E.2d at 7. Thus, the court concluded that rather than calling for the application of equitable estoppel, the defendant's decision to develop the scrap-processing operation was "made on its own judgment and at its own risk." Id.
Similarly, ISC argues that the defendants promised to purchase substantial amounts of Restore Plus and DCA if ISC developed the novel radiator cleaner. ISC contends that it was encouraged by these statements to expend time, money, and energy on the development of Restore Plus. However, ISC does not offer any evidence suggesting that the defendants tricked it into not getting the agreement in writing, or misrepresented a past or present material fact. Viewed most favorably to ISC, the best the evidence could show is that the defendants misstated their future intention to purchase Restore Plus from the plaintiff. Yet such a misstatement is insufficient to demonstrate the sort of unconscionability that is required to invoke the doctrine of equitable estoppel. See Bradley Real Estate, 640 N.E.2d at 12-13 (affirming trial court's rejection of equitable estoppel because party could not demonstrate misrepresentation of present or preexisting facts, or the existence of a scheme to defraud). In sum, we conclude that ISC has failed to raise a genuine issue of material fact as to the viability of its claim for equitable estoppel, and accordingly grant summary judgment to the defendants on Count IV.
C. Count V (Quantum Meruit)
The Corporate Defendants also seek summary judgment on ISC's claim of quantum meruit in Count V of the Amended Complaint. Quantum meruit--technically a subset of the law of quasi-contract and unjust enrichment--is based on the premise that a party should not be permitted to retain the benefit of services provided by another if such retention "violates the fundamental principles of justice, equity, and good conscience." See Midcoast Aviation, Inc. v. General Elec. Credit Corp., 907 F.2d 732, 737 (7th Cir. 1990). "In order to be successful on a theory of quantum meruit under Illinois law, a party must prove performance of the services, reasonable value of the services, and the receipt by the defendant from the plaintiff of a benefit which it would be unjust for him to retain without paying the complaining party." North American Lighting, Inc. v. Hopkins Mfg. Corp., 37 F.3d 1253, 1259 (7th Cir. 1994).
ISC claims that it spent hundreds of hours and thousands of dollars developing Restore Plus and improving various DCA products for the Corporate Defendants. By giving material specifications and samples of these products to the defendants, ISC claims it bestowed a benefit on the defendants--that is, the availability of the formulas without the cost of developing them. For example, Hudgens testified at his deposition that Dober, the Corporate Defendants' new supplier, did not need to run as many tests on its version of Restore Plus because it could use ISC's material specifications. Hudgens Dep. at 150-51. While it is not clear the extent to which the Corporate Defendants benefited from ISC's work, Rohter v. Passarella, 246 Ill. App. 3d 860, 617 N.E.2d 46, 50, 186 Ill. Dec. 807 (Ill. App. Ct. 1993) (measure of damages in quantum meruit is reasonable value of benefit received by defendant), there is sufficient evidence in the record from which a jury could conclude that the defendants did unjustly benefit from ISC's services.
The defendants contend that ISC cannot recover any benefits it may have bestowed on them because the parties were still negotiating over whether to use ISC as a supplier and ISC did not expect to be directly reimbursed for its "preliminary services." See North American Fin. Group, Ltd. v. S.M.R. Enters., Inc., 583 F. Supp. 691, 700 (N.D. Ill. 1984). However, ISC claims that it was not merely negotiating with the Corporate Defendants, but that the defendants had actually agreed to place orders for Restore Plus and DCA if ISC provided certain services. Thus, a factual question exists over whether ISC expected compensation for its services, and we cannot resolve that issue on the record before us.
Fleetguard also argues that ISC cannot maintain both a breach of contract claim and a quantum meruit claim, since this would allow the plaintiff to seek both expectation damages and reliance damages. While it is true that a plaintiff cannot prevail on both a breach of contract claim and a quasi-contract claim dealing with the same subject matter, see Murray v. Abt Assocs., Inc., 18 F.3d 1376, 1379 (7th Cir. 1994), there is no rule against pleading both causes of action in the alternative, Concord Indus., Inc. v. Harvel Indus. Corp., 122 Ill. App. 3d 845, 462 N.E.2d 1252, 1255, 78 Ill. Dec. 898 (Ill. App. Ct. 1984). In any event, given that we have granted summary judgment on Counts I and IV of the Amended Complaint, no possibility exists that ISC will recover under both contract law and quantum meruit.
Finally, the defendants argue that, pursuant to 735 ILCS 5/13-205, a action in quantum meruit must be brought within five years of when the services are alleged to have been provided. Rohter, 617 N.E.2d at 52-53. As the original complaint was filed on September 1, 1994, the defendants argue that ISC is precluded from recovering the value of any services rendered prior to September 1, 1989. ISC concedes the point by failing to respond to the defendants' limitations argument. See Swedish American Hosp. v. Midwest Operating Eng'rs Fringe Ben. Funds, 842 F. Supp. 1039, 1043 (N.D. Ill. 1993). Accordingly, we hold that ISC's quantum meruit claims are subject to the five-year limitations period of 5/13-205, and that ISC cannot recover for any services it provided more than five years before the filing of this action.
In sum, because material issues of fact remain in dispute as to any benefit the Corporate Defendants received because of the plaintiff's services, and whether ISC expected any compensation, summary judgment on all of Count V is inappropriate. However, we grant the defendants' motion to the extent that ISC seeks to recover for services provided to the Corporate Defendants before September 1, 1989.
For the reasons set forth above, we grant the defendants' motion for summary judgment on Counts I and IV, and grant in part and deny in part its motion for summary judgment on Count V. This case is set for trial on April 1, 1996 at 10:00 a.m. before United States District Court Judge Samuel P. King. Status will be held before Chief Judge Aspen on February 23, 1996 at 10:00 a.m. It is so ordered.
MARVIN E. ASPEN
United States District Judge