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03/27/96 CYNTHIA PLAMBECK v. GREYSTONE MANAGEMENT &

March 27, 1996

CYNTHIA PLAMBECK, PLAINTIFF-APPELLANT,
v.
GREYSTONE MANAGEMENT & COLUMBIA NATIONAL TRUST CO. AS TRUSTEE UNDER TRUST NO. 2360, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Cook County. Honorable David G. Lichtenstein, Judge Presiding.

As Corrected May 10, 1996. As Modified on Denial of Rehearing June 19, 1996.

The Honorable Justice Greiman delivered the opinion of the court: Tully, P.j., and Cerda, J., concur.

The opinion of the court was delivered by: Greiman

MODIFIED ON DENIAL OF REHEARING

The Honorable Justice GREIMAN delivered the opinion of the court:

This case involves the question whether a tenant's motive, even if "improper" or unrelated to the tenancy, is relevant in seeking to terminate a lease agreement under provisions of the Chicago Residential Landlord Tenant Ordinance (Ordinance). Chicago Municipal Code ยง 193.1 et seq. (amended September 8, 1986). *fn1

On September 15, 1988, Cynthia Plambeck (plaintiff or tenant) entered into a written lease agreement with Greystone Management & Columbia National Trust Company (defendant or landlord) for lease of an apartment in a seven-unit building in Chicago in which the owners did not reside. Tenant gave landlord a security deposit of $480 when she rented the apartment.

The parties renewed the lease in October 1989, and landlord increased tenant's security deposit to $500, requiring tenant to remit an additional $20 payment to landlord. Landlord deposited tenant's $20 check into the same bank account in which it also deposited rent proceeds and other assets. The lease was renewed again in October 1990, and increased tenant's security deposit to $525, requiring tenant to remit an additional $25 payment which the landlord again deposited into its own account. Landlord claims these deposits were made in error or oversight.

On April 28, 1991, tenant cosigned a note and mortgage with her mother and boyfriend for purchase of a home nearby in Chicago. On May 1, 1991, tenant notified landlord in writing of her intention to vacate the apartment on May 31, 1991. This notice, however, was rescinded by the tenant in writing on May 14, 1991.

Also on May 14, 1991, tenant served landlord with written objections to her lease agreement based on the landlord's alleged violation of various provisions of the Ordinance. The May 14 correspondences notified landlord of tenant's intent to terminate her tenancy 30 days after landlord's receipt of the letters, unless landlord:

1. Corrected 26 alleged violations of the Chicago Building Code (the Code) in the premises and common areas as provided in section 193.1-7 of the Ordinance;

2. Tendered tenant a new lease, within 15 days, deleting certain provisions in the parties' existing lease allegedly prohibited by section 193.1-14 of the Ordinance, such as the requirement that tenant waive certain remedies against landlord (section 193.1-14(a)), lack of mutuality in the assessment of attorney fees (section 193.1-14(f)), limitation of landlord's liability (section 193.1-14(c)), waiver of notice of termination of tenancy (section 193.1-14(d)), the right to shorten the demised term (section 193.1-14(g)) and 14 other claims of conflict between the Ordinance and the lease;

3. Disclosed the name, address and telephone number of the person authorized to accept service of process for the landlord as required by section 193.1-9 of the Ordinance, and;

4. Disclosed to tenant the violations of the Code which had been cited by the City of Chicago within the preceding 12 months as mandated by section 193.1-10 of the Ordinance.

Eighteen days later, on June 1, 1991, tenant "terminated" her lease by written notice, effective June 2, 1991 (19 days after notifying landlord of her intention), by reason of landlord's failure to tender a new lease in compliance with the Ordinance. Tenant paid full rent for the month of May and vacated on May 31, 1991, leaving the premises in "good condition." Tenant subsequently moved into her new home.

On June 21, 1991, tenant requested in writing that landlord return her security deposit. Landlord made no claim of damages, but withheld tenant's security deposit as a setoff for back rent claimed for the months the apartment remained vacant, June and July of 1991. Landlord believed that tenant had not legally terminated her lease and thus remained liable for June and July's rent. Additionally, landlord did not pay or credit the tenant with interest on her security deposit from 1989 to date.

Tenant filed a 14-count complaint against landlord in the circuit court of Cook County, seeking damages available under the Ordinance for landlord's: (1) failure to pay interest on tenant's security deposit; (2) failure to return her security deposit; (3) commingling of the security deposit; (4) refusal to tender tenant a new lease; (5) failure to disclose name of agent; (6) failure to disclose building code violations; and (7) landlord's breach of implied and statutory warranties of habitability.

After a bench trial, the trial court found in favor of tenant on those counts relating to landlord's failure to pay interest on the security deposit in 1989 and 1990, respectively, as violations of section 193.1-8 of the Ordinance.

The trial court found, quite accurately, that tenant's actions in seeking to terminate her tenancy were motivated by a desire to "get out of her lease," and not due to a sudden abhorrence of building code violations or a bout of tenant activism. The trial court found for landlord on the remaining counts and applied tenant's security deposit to offset unpaid rent.

The trial court found additionally, and as the basis for its rulings, that tenant had not legally terminated her lease, entitling landlord to a setoff of $503.12 in back rent against amounts due tenant for failure to return and pay interest on the security deposit. The setoff was accomplished by landlord's oral motion absent any pleading to allege a setoff with the trial court. Tenant disputes that a trial court can award an unpleaded setoff, while landlord maintains that it merely conformed the pleadings to the proof.

Tenant's appeal to this court focuses on whether (1) she legally terminated her lease and thus should have prevailed at trial, and (2) whether the trial court's decision that she did not properly effect such termination was based on its perception that her motives for termination had nothing to do with her lease or occupancy.

As an initial matter, we acknowledge that tenant's motives were impure in the sense that she was eager to terminate her lease in order to avoid either paying rent while living in her new home or the trouble of subletting for the remaining two months of the lease. The question is whether and to what extent her motivation should have affected the trial court's analysis of the dispute.

Landlord contends that "the decisive factor in this case is that the very day before she notified the Defendants of her intention to vacate the premises, the plaintiff purchased a new home for herself and her family. All subsequent notices (of landlord's Ordinance violations) sent by Plaintiff were clearly pretextual and in furtherance of her scheme to devise some justification for her ultimate goal of getting out of her obligations.

Landlord further contends that "the trial court's reliance on this fact in assessing the credibility of the plaintiff's testimony was within its discretion and reasonable." Landlord invites us to apply a manifest weight of the evidence standard of review because "the issue of credibility is for the trial court."

Although landlord is correct that a reviewing court will generally not disturb a trial court's findings unless they are against the manifest weight of the evidence ( Northern Illinois Medical Center v. Home State Bank, 136 Ill. App. 3d 129, 142, 482 N.E.2d 1085, 90 Ill. Dec. 802 (1985)), construction and legal effect of the lease agreement and controlling ordinance raise questions of law which we review de novo. See Naylor v. Kindred, 250 Ill. App. 3d 997, 1003, 620 N.E.2d 520, 189 Ill. Dec. 552 (1993). The trial court is deemed to know the Ordinance, and the lease was admitted into evidence. As landlord notes, the trial court's articulation of its findings indicates that the trial court's assessment of tenant's motive formed the basis for its decision in landlord's favor:

"I believe based on my view of the evidence and particularly having listened to the witnesses, the Plaintiff here, a lay person, was eager to get out of her lease by any means available to her and she was eager to get out because she had a motive, the motive to which she wanted to move and in which has confided she now lives with her mom and boyfriend."

The Ordinance provides tenants a remedy and prescribes the manner in which that remedy is to be invoked, notwithstanding the trial court's preoccupation with tenant's motivation for asserting her statutory rights.

Landlord cites no authority allowing a trial court to consider the tenant's motives. Tenant, on the other hand, cites Meyer v. Cohen, 260 Ill. App. 3d 351, 632 N.E.2d 22, 197 Ill. Dec. 953 (1993), for the proposition that a tenant's motive is irrelevant and the Ordinance requires strict compliance. Meyer, however, does not directly address this proposition. Rather, the Meyer court simply held that the tenant was entitled under the Ordinance to terminate her lease after notifying the landlord of his failure to attach a summary of the Ordinance to the lease as required by section 5-12-170 of the Ordinance, formerly section 193.1-17. Meyer, 260 Ill. App. 3d at 358.

Landlord attempts to impress a "clean hands" doctrine upon tenant as a condition to relief under the Ordinance. Such a theory is not overlaid upon this Ordinance, adopted to protect tenants from landlords in recognition of the historical disparity between the bargaining powers of landlord and tenant, so that such a defense would be at a cross-purpose with the reasons behind the enactment of the Ordinance.

Tenant has simply invoked her rights under the Ordinance seeking to hold landlord to its obligations under the Ordinance. The court is not at liberty to depart from the plain language of the Ordinance by reading into it exceptions, limitations or conditions that the legislature did not express. Kraft, Inc. v. Edgar, 138 Ill. 2d 178, 189, 561 N.E.2d 656, 149 Ill. Dec. 286 (1990).

Accordingly, we hold that a tenant's motive for invoking the right of termination provided by the Ordinance is simply not relevant to the determination whether the termination is valid.

What remains is to determine whether tenant validly terminated her lease and is thus entitled to the relief she sought. Tenant contends she has three independent grounds for termination of her lease. First, tenant asserts a right to terminate under section 193.1-14 because landlord employed a lease containing four paragraphs prohibited by the Ordinance. The challenged lease provisions involve landlord's attempt to shift the burden of payment of attorney fees, limit its own liability, prescribe the manner of notice required in the event of tenant's default and allow landlord preferential termination rights.

1. Attorney fees.

Paragraph 22 provides: Section 193.1-14(f) prohibits

agreement that:

"Lessee shall pay all costs, "in the event of a lawsuit

expenses and attorneys fees arising out of the tenancy

which shall be incurred or the tenant will pay the

expended by Lessor due to lanlord's attorney's fees

Lessee's breach of the covenants except as ...


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