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04/30/96 BRAUN-SKIBA v. LASALLE NATIONAL BANK

April 30, 1996

BRAUN-SKIBA, LTD., INTERVENOR PLAINTIFF-APPELLANT,
v.
LASALLE NATIONAL BANK, AS TRUSTEE UNDER TRUST NO. 100819, WOLF POINT DEVELOPMENT CORPORATION, AND LASALLE NATIONAL BANK, AS TRUSTEE UNDER TRUST NO. 114065, DEFENDANTS-APPELLEES. LASALLE NATIONAL BANK, AS TRUSTEE UNDER TRUST NO. 114065, COUNTER PLAINTIFF-APPELLEE V. BRAUN-SKIBA, LTD., COUNTER DEFENDANT-APPELLANT.



APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY, CHANCERY DIVISION. THE HONORABLE NORMAN SANDS, JUDGE PRESIDING.

The Honorable Justice Scariano delivered the opinion of the court: Divito and Burke, JJ., concur.

The opinion of the court was delivered by: Scariano

The Honorable Justice SCARIANO delivered the opinion of the court:

Braun-Skiba ("plaintiff"), an architectural firm, rendered services relating to property being developed by Wolf Point Development Corporation ("Wolf Point"). After Wolf Point failed to make its contractually scheduled payments, plaintiff filed lien number 89304682 ("lien one") with the Cook County Recorder of Deeds on July 5, 1989. At the time lien one was filed, LaSalle National Bank Trust Number 100819 held title to the property. Lien one gave March 7, 1987 as the last date plaintiff had performed any work. When plaintiff later discovered that the year 1987 was a typographical error, and that it should have been 1989, it caused lien number 89452897 ("lien two") to be recorded on September 25, 1989. However, instead of simply changing the year from 1987 to 1989, plaintiff's lien two stated that the last work it performed was on June 9, 1989.

On January 31, 1990, plaintiff filed a petition to intervene in the instant case, which had been brought by other lien holders, in order to enforce its own lien *fn1 and to assert its priority over the others. *fn2 On April 1, 1990, before the circuit court ruled on plaintiff's petition to intervene, the property was deeded to LaSalle National Bank Trust Number 114065 ("defendant"), and the transfer was recorded on April 17, 1990. Plaintiff's motion to intervene against Trust Number 100819 was granted August 16, 1990.

On December 16, 1991, plaintiff was permitted to add defendant as a party to this action. On March 9, 1992, the circuit court held that the lien was valid against Trust Number 100819. However, this ruling was obviously not very helpful to plaintiff since that trust was no longer the owner of the property for the reasons and authorities as discussed below.

At the trial held to enforce the lien against defendant, the only factual dispute was whether plaintiff performed work during the four month period prior to the filing of its lien as required under section 7 of the Mechanics Lien Act (770 ILCS 60/7 (West 1993) (formerly Ill. Rev. Stat. Ch. 82 par. 7). Leonard Skiba, a principal of plaintiff and its vice president and secretary, testified that plaintiff's contract with Wolf Point was for architectural services to be rendered in connection with a twenty-six million dollar construction project that was to take two years to complete for a fee of $650,000. He stated that the contract called for monthly bills that were based on the percentage of work completed, and not on the number of hours worked. Payment of the $650,000 was divided into five phases of the work, and a percentage was assigned to each phase.

When Wolf Point did not pay the approximately $232,248.94 that was due prior to March 7, 1989, plaintiff prepared a lien. In attempting to explain the reason for the discrepancy in dates on the two liens, Skiba testified that the March 7 date was chosen for the first lien because it was a "milestone date in the project's approval", and that the lien was prepared in March, but was not filed until July 5, 1989. However, he continued, despite the fact that the first lien was filed in July, it did not include the additional work performed in June, when Wolf Point requested that plaintiff prepare drawings and a project model for a presentation to be made on the client's behalf. Although he testified that a letter to his client reflected that the presentation was held on June 6, 1989, during cross examination he admitted that the letter actually discussed only whether plaintiff was going to be paid. He also admitted that he performed no work on June 9, 1989. Skiba also testified that the work performed in June was not reflected in the first lien because "the amount of work that was being done between that March date and the June date was not a significant amount relative to the scale of the contract * * * for 650,000." Furthermore, he admitted that plaintiff's bills in March, April, May, and June each reflected that $232,248.94 was due, and that none of that amount represented work performed after March; and that the amount was essentially for the same value (with an eighty-one cent difference) as the value of the unpaid work prior to March 7, 1989. *fn3

Although the trial court did not permit plaintiff to admit into evidence the time sheets of its employee, Dave LaPlaca, Skiba testified that LaPlaca performed two hours of work in June preparing for the meeting with Skiba.

Sherwin Braun, former president of plaintiff, testified that he worked on the project between March 7, 1989 and June 9, 1989; more specifically, that he spent one and a half hours in April performing administrative tasks related to the project. Although his time sheets indicated that he worked three hours on the project during the week of May 26, 1989, Braun could not recall what he did, nor could he recall performing any work on June 9, 1989. Further, he admitted to signing a verified complaint stating that plaintiff ceased performing architectural services for Wolf Point on March 9, 1989.

Prior to the trial court's decision, but after the trial, plaintiff brought a motion to file a third amended complaint, which sought to reform the first lien to reflect June 9, 1989, as the date of completion of the work and also to enforce the first and second liens specifically. Defendant opposed the amendment, explaining that it would be prejudiced because plaintiff did not seek to have the first lien admitted into evidence and that it would have never been admitted but for the fact that defendant introduced it in its attempt to impeach plaintiff's witnesses. The trial court denied plaintiff's motion.

The trial court held that the first lien contained a typographical error, and that it should have stated the date of completion of the work as March 7, 1989, instead of March 7, 1987. The judge further held that the lien that was perfected was that of September 25, 1989, the date the second lien was filed. Because the lien was perfected on September 25, 1989, and because Section 7 of the Mechanics Lien Act (770 ILCS 60/7) requires that the lien be filed within four months of the completion of the work, the last date that the work had to have been completed for a valid lien was May 25, 1989.

Accordingly, the trial court found that the lien perfected on September 25, 1989, was untimely because the date of completion of the work was March 7, 1989, despite the fact that plaintiff had alleged and testified that it performed work up until the week of June 9, 1989. The judge further held that the work that was performed subsequent to March 7, 1989, was not lienable because it was trivial and inconsequential; and that plaintiff's prior sworn statements in the first lien and the verified complaint which stated that the work was completed March 7, 1987 and March 9, 1989, respectively, were formal admissions of fact. The court based its decision on the evidence that plaintiff did not send any increased billing for services performed after March, 1989; that the amounts claimed in the first and second lien were identical; and that the work performed during June related to plaintiff's effort to collect bills, a non-lienable service. The trial court concluded by holding that plaintiff, "chose the June 9, 1989 date merely to revive its lien thus, [plaintiff] did not timely file its notice of mechanic's lien, and its lien is not enforceable against [defendant]." This appeal followed.

Plaintiff argues that since, in order to file a proper lien, it is not required that it contain a completion date, *fn4 the trial court erred in finding that plaintiff's first lien was not perfected ...


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