MEMORANDUM OPINION AND ORDER
Pending is Defendant The Harlem-Irving Companies, Inc's.
("Harlem-Irving") Motion for Summary Judgment, which requests a
finding of partial non-liability under Federal Rule of Civil
Procedure 56(d). For the reasons set forth below, the Motion is
denied, with the exception of an accord and satisfaction issue
Defendant Harlem-Irving operates an enclosed shopping mall in
the Chicagoland area. Best Buy Company, Inc. ("Best Buy") is one
of the tenants in that shopping mall. Best Buy is a leading
retailer of consumer electronics, home appliances, computer
software, music and video products. In late 1992, the parties
signed a lease, and a rider/addendum. The lease required
Harlem-Irving to deliver possession to Best Buy on or before
December 15, 1992. However, the term of the lease did not begin
until March 1, 1993. The lease term expires on February 29,
Under the lease, Best Buy is required to pay a proportionate
share of common area maintenance ("CAM") charges. CAM charges are
the costs associated with maintaining those portions of the mall
which are not under the exclusive possession of any particular
tenant (i.e. common areas). Examples of common areas include
(internal or external) courtyards, parking lots, driveways,
walkways, lobbies and landscape. Harlem-Irving assesses a monthly
charge for additional rent against Best Buy and other tenants
based on estimated CAM expenses, and each month, Best Buy pays
one-twelfth of its estimated proportionate share of CAM expenses,
subject to reconciliation of overpayments or underpayments after
the end of the calendar year. Of a total of 540,596 square feet
of gross leasable area, Best Buy leases 30,656 square feet. Best
Buy's proportionate share of CAM charges is therefore about 6%.
The lease excludes from Best Buy's share of CAM charges "office
overhead, wages and salaries." Harlem-Irving attempted to charge
Best Buy for all non-office wages and salaries, including
management personnel. Best Buy objected and announced its view of
the "office overhead, wages and salaries" exclusion clause as
excluding from CAM not merely office wages and office salaries,
but rather all wages and all salaries. Harlem-Irving's position
is that the exclusion for "office overhead, wages and salaries"
an exclusion only for "office overhead, [office] wages and
The lease also requires Best Buy to pay Harlem-Irving an
additional administrative fee equal to seven (7%) percent of CAM
charges. The lease, however, provides that Harlem-Irving should
not assess the 7% fee against "real estate taxes and
insurance." Best Buy reads this clause as an exclusion not
merely for real estate insurance, but rather for all insurance.
Harlem-Irving's position is that the exclusion pertains to "real
estate taxes and [real estate] insurance."
Under the lease, repair of the parking lot is a CAM charge
beginning in the sixth year after the rent commencement date.
Repair of the roof is not a CAM charge, but is the sole
responsibility of Harlem-Irving. Part of the surface of the
parking deck also serves as part of the roof of the shopping
mall. Best Buy has challenged charges for repair of the spalling
Best Buy is challenging too, Harlem-Irving's assessment of CAM
charges for training expenses, licenses and permits.
On July 26, 1995, Best Buy issued a protest letter disputing a
variety of CAM charges. In pertinent part, the letter stated that
management salaries should not be included in CAM charges because
the lease "specifically excludes `. . . wages and salaries. . .
.'" The letter also complained about parking ramp expansion joint
replacement, accounting fees, security/maintenance office
supplies and overhead, engineering and architectural fees,
snow-melting machine, deck repair and reconstruction and audit
rights. This letter did not complain about licenses, training
expenses, permits or the inclusion of workers' compensation
insurance premiums. By August 7, 1995, the parties reached a
compromise agreement on the categories which Best Buy had
protested. The agreement was for the amounts due in 1993, and it
was entered into without prejudice to Best Buy's rights under the
lease. The parties continue to be at odds over CAM charges
assessed by Harlem-Irving for all years after the compromise.
I. SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate where "the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party
is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c).
See also Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct.
2548, 91 L.Ed.2d 265 (1986). Once the moving party has produced
evidence to show that it is entitled to summary judgment, the
party seeking to avoid such judgment must affirmatively
demonstrate that a genuine issue of material fact remains for
trial. LINC Fin. Corp. v. Onwuteaka, 129 F.3d 917, 920 (7th
In deciding a motion for summary judgment, a court must "review
the record in the light most favorable to the nonmoving party and
to draw all reasonable inferences in that party's favor."
Vanasco v. National-Louis Univ., 137 F.3d 962, 1998 WL 81458,
at *2 (7th Cir. Feb.27, 1998). See also Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202
(1986). Nevertheless, the nonmovant may not rest upon mere
allegations but "must set forth specific facts showing that there
is a genuine issue for trial." Fed.R.Civ.P. 56(e). See also
LINC, 129 F.3d at 920. A genuine issue of material fact is not
shown by the mere existence of "some alleged factual dispute
between the parties," Anderson, 477 U.S. at 247, 106 S.Ct.
2505, or by "some metaphysical doubt as to the material facts,"
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Rather, a
genuine issue of material fact exists only if "a fair-minded jury
could return a verdict for the [nonmoving party] on the evidence
presented." Anderson, 477 U.S. at 252, 106 S.Ct. 2505.
II. AMBIGUOUS LANGUAGE IN THE LEASE AND THE DOCTRINE OF
The main disputed clause in the lease excludes from CAM "office
overhead, wages and salaries." That phrase was inserted by Best
Buy's attorney James Istas pursuant to negotiations between
counsel for both sides. Because both sides participated to an
apparently equal degree in the final drafting of the lease, its
language will not be construed strictly against either party.
Meade v. Kubinski, 277 Ill. App.3d 1014, 1020, 214 Ill.Dec. 733,
661 N.E.2d 1178, 1183 (1996).
Harlem-Irving relies on the doctrine of ejusdem generis to
persuade this court to, as a matter of law, read the exclusionary
phrase "office overhead, wages and salaries" as "office overhead,
[office] wages and [office] salaries." Under the same doctrine,
Harlem-Irving argues that the exclusionary phrase "real estate
taxes and insurance" means "real estate taxes and [real estate]
insurance." Best Buy disagrees with such an interpretation.
"The rule of ejusdem generis, while firmly established, is
only an instrumentality for ascertaining the correct meaning of
words when there is an uncertainty." Gooch v. United States,
297 U.S. 124, 128, 56 S.Ct. 395, 397, 80 L.Ed. 522 (1936). "Under
the principle of ejusdem generis, when a general term follows a
specific one, the general term should be understood as a
reference to subjects akin to the one with specific enumeration."
Norfolk & Western Railway Co. v. American Train Dipatchers,
499 U.S. 117, 129, 111 S.Ct. 1156, 1163, 113 L.Ed.2d 95 (1991).
Best Buy has presented two arguments as to why the doctrine of
ejusdem generis does not apply to the lease language in issue.
First of all, Best Buy argues that the complete list of CAM
exclusions in the subject lease is much longer, including the
following items: capital improvements or replacements, ground
rent, interest, debt service, insurance, depreciation,
amortization, real estate taxes or assessments, office overhead,
wages and salaries. Best Buy argues that each item on this list
is separate and distinct, such that there is no textual basis to
assume that wages and salaries are not distinct items, equal in
importance to all of the other enumerated items. (See Pl.Resp.
at 10.) Second, Best Buy argues, somewhat aside from the
particulars of ejusdem generis, that it is a basic rule of
punctuation that commas are used to set off items in a series,
with or without a comma before the conjunction preceding the last
item on the list. (Id. at 10.) Thus, Best Buy maintains, under
ordinary rules of punctuation, the phrase "office overhead,"
"wages" and "salaries" identifies each item as separate and
independent on the list of CAM exclusions. (Id. at 10.) To
achieve Harlem-Irving's result, it is argued, the list should
have therefore provided "and office overhead, wages and
salaries," which would have made it clear that office modified
overhead, wages and salaries. (Id. at 10.)
Application of the doctrine of ejusdem generis is dependent
upon whether or not the term "office overhead" is separate and
distinct from the terms "wages" and "salaries." Each party has a
different interpretation of the meaning of these lease terms, and
the language is certainly capable of being read both ways. Either
party's interpretation would entitle such party to prevail on the
disputed CAM charges. As such, there exists a genuine issue of
material fact which precludes this court from granting summary
judgment based on the doctrine of ejusdem generis.*fn4
III. BEST BUY'S ALLEGED FAILURE TO MAKE A TIMELY PROTEST
Harlem-Irving has alleged that it submitted to Best Buy, CAM
statements which specifically listed the categories about which
Best Buy is now complaining, and that except for the spalling
deck, Best Buy's first protest of the inclusion of these
categories was not until October, 1997 — more than four years
after Best Buy started making CAM payments. (See Def. Mot. at
7; Def. 12(M), ¶¶ 78-83.) Harlem-Irving's argument is that Best
Buy's alleged failure to protest other CAM charges which are not
part of this lawsuit, coupled with Best Buy's silence on the
inclusion of those categories which are now the subject of this
lawsuit, shows that Best Buy itself believed the categories at
issue were properly included within CAM. Specifically,
Harlem-Irving argues that Best Buy sent a memo to Harlem-Irving
on May 25, 1995, in which Best Buy sought greater specificity
(such as what services are provided, how many hours and the
like). However, Best Buy's memo did not assert that the lease
somehow excludes these categories of non-office salaries. (See
Def. 12(M), ¶¶ 54, 56.)
In addition, Harlem-Irving contends that because Best Buy was
aware that it was paying CAM charges for the categories of
non-office wages and salaries, administrative fee or workers
compensation, or the like, Best Buy's conduct renders immaterial,
any ambiguity in the lease language.
Best Buy maintains, however, that it objected to year-end
reconciliations, as contemplated by the lease, which provides
that "unless disputed," Best Buy shall pay any year-end CAM
reconciliation balance within 30 days of being invoiced. (See
Pl. 12(N), ¶ 48; Pl.Resp. at 7.) During the year(s), Best Buy
states it merely was making monthly "estimated" payments without
waiver of objections. Furthermore, Best Buy disagrees with
Harlem-Irving's reading of its memo; specifically, nowhere
therein did Best Buy accept wages and salaries as valid CAM
charges, and Best Buy objects to Harlem-Irving's conclusion that
by seeking greater specificity on the salaries for maintenance
and security employees, Best Buy was thus conceding that these
were valid CAM categories.
In view of the foregoing, a genuine issue of material fact
exists and it cannot be said as a matter of law that Defendant in
entitled to summary judgment based on an alleged failure of Best
Buy to make a timely protest.
IV. THE "MEND THE HOLD" DOCTRINE
"`Mend the hold' is a common law doctrine that limits the
rights of a party to a contract suit to change his or her
litigating position." Harbor Ins. Co. v. Continental Bank
Corp., 922 F.2d 357, 362 (7th Cir. 1990). The doctrine, which is
in force in Illinois, has been interpreted to mean that "a party
to a contract cannot, at least after the pleadings are complete,
repudiate a position taken in the course of litigation over the
contract." Horwitz-Matthews, Inc. v. City of Chicago,
78 F.3d 1248, 1251 (7th Cir. 1996). See also Israel v. National Canada
Corp., 276 Ill. App.3d 454, 658 N.E.2d 1184, 1191-92, 213
Ill.Dec. 163, 170-71 (1995); Delaney v. Marchon, Inc.,
254 Ill. App.3d 933, 194 Ill.Dec. 128, 133, 627 N.E.2d 244, 249
Harlem-Irving argues that from 1993 until late 1997, Best Buy
protested a number of CAM issues, but not the inclusion of
non-office wages and salaries, workers compensation within the
administrative fee or training, licenses or permits.
Therefore, Harlem-Irving contends that except for the spalling
deck issue, Best Buy's lawsuit is barred by the "mend the hold"
doctrine. (See Def. Mot. at 9.)
Best Buy, on the other hand, argues that there is no
controlling authority for the notion that the doctrine applies
outside the litigation context, and that the doctrine has no
application in this case because Best Buy never changed its
position during the litigation. (See Pl.Resp. at 11.)
"The reach of the `mend the hold' doctrine is uncertain. The
language of many of the cases, including those in the Illinois
Appellate Court . . . is consistent with the view that the
doctrine only bars a contract party from changing his position
in litigation." Harbor Ins. Co., 922 F.2d at 364 (emphasis
added). The court went on to say that:
[i]f "mend the hold" is viewed procedurally, as a
rule somehow limited to litigation, it may cross the
line that separates "substance" from "procedure" . .
. by rigidifying the system of pleading that the
Federal Rules of Civil Procedure seek to make supple.
Those rules are designed not to freeze parties in the
positions they take in their initial pleadings. The
pleadings kick off a course of pretrial discovery
expected to result in modifications in the parties'
positions, which often do not crystalize until the
filing of the pretrial order, sometimes on the very
eve of trial. . . . The "mend the hold" doctrine,
procedurally viewed, embodies an antithetical
conception of the litigation process, one in which a
party is expected to have all the pins in perfect
order when he files his pleading.
Id. at 364. The court did note that:
[o]n the other hand, the two decisions by the Supreme
Court of Illinois that discuss the doctrine do not
tie it to the litigation context at all. They
describe it as a doctrine that estops a contract
party to change the ground on which he has refused to
perform the contract, whether or not it was a ground
stated in the pleading, or otherwise in the course of
litigation. An argument for confining the doctrine in
this fashion is that otherwise it would step on the
toes of judicial estoppel. That doctrine requires
separate suits; mend the hold does not. So,
interpreted as a procedural doctrine rather than a
contractual one, mend the hold would make judicial
estoppel superfluous. Yet, the Illinois courts
believe they can coexist happily.
Id. at 364. See Rural Electric Convenience Cooperative Co. v.
Illinois Commerce Commission, 118 Ill. App.3d 647, 652,
454 N.E.2d 1200, 1203-04, 73 Ill.Dec. 951, 954-55 (1983).
In addition to noting the uncertainty surrounding the
application of the "mend the hold" doctrine, Best Buy also argues
that even if the doctrine were available, it would not have any
impact on this case because Best Buy has not mended its hold
outside the litigation. Best Buy's opposition to the inclusion of
certain charges in CAM, it maintains, has been consistent
throughout the term of the lease. (See Pl.Resp. at 11.)
Specifically, Best Buy asserts that it stated in a letter to
Harlem-Irving in July 1995, that wages and salaries were excluded
from CAM under the lease. Furthermore, Best Buy avers that
Harlem-Irving acknowledged, on July 28, 1995, that Best Buy
objected to all of the CAM charges. (See Pl.Resp. at 12.)
With regard to the non-salary issues, Harlem-Irving attaches
great significance to Best Buy's letters, which did not mention
some of the items at issue in this lawsuit. Best Buy argues that
Harlem-Irving knew in 1995, that Best Buy was rejecting all CAM
charges claimed by Harlem-Irving. (See Pl.Resp. at 12.)
This court agrees with Best Buy, in that the fact that Best Buy
did not cite each objectionable item in its letters is not proof,
as a matter of law, that it accepted those items. Under summary
judgment standards, even arguendo if the "mend the hold"
doctrine is applicable outside the litigation context, it is
that Best Buy's disputes as to the CAM charges were adequately
communicated via non-payment and general objections. Thus, a
genuine issue of material fact exists and Harlem-Irving's summary
judgment motion based on the issue of "mend the hold" is denied.
V. THE "VOLUNTARY PAYMENT" DOCTRINE
Harlem-Irving contends that even if Best Buy were able to
create an appropriate fact dispute about whether the parties
intended the categories in issue to fall within CAM charges, the
"voluntary payment" doctrine prohibits Best Buy from recouping
any payments which Best Buy made before the date of its first
protest. Except for the spalling deck, Harlem-Irving claims that
the first protest did not occur until October 21, 1997.
"Pursuant to the voluntary payment doctrine, money voluntarily
paid under a claim of right by one who has knowledge of the
relevant facts cannot be recovered by the payor on the ground
that the claim was illegal." Halstead Terrace Nursing Center,
Inc. v. Scottsdale Ins. Co., 1997 WL 124263, *3 (N.D.Ill. 1997).
See Kanter & Eisenberg v. Madison Assocs., 116 Ill.2d 506, 512,
108 Ill. Dec. 476, 508 N.E.2d 1053, 1055 (1987). "Absent fraud,
coercion or mistake of fact, monies paid under a claim of right
to payment but under a mistake of law are not recoverable."
Halstead Terrace Nursing Center, Inc., 1997 WL 124263, at *3.
See Smith v. Prime Cable of Chicago, 276 Ill. App.3d 843, 848,
213 Ill.Dec. 304, 658 N.E.2d 1325, 1330 (1995), appeal denied,
166 Ill.2d 554, 216 Ill.Dec. 11, 664 N.E.2d 648 (1996). In order
to "negate the applicability of the voluntary payment doctrine,
one must show not only that the claim asserted was unlawful but
also that payment was not voluntary, that there was some
necessity which amounted to compulsion." Id. at 848, 213
Ill.Dec. 304, 658 N.E.2d 1325 (citing Illinois Glass Co. v.
Chicago Tele. Co., 234 Ill. 535, 541, 85 N.E. 200, 201 (1908)).
"If the payment was made as a result of compulsion or duress, it
is stripped of its voluntary character." Arra v. First State
Bank & Trust Co. of Franklin Park, 250 Ill. App.3d 403, 408, 190
Ill.Dec. 259, 621 N.E.2d 128, 132 (1993).
A. Failure to Protest
Harlem-Irving's argument relies on the proposition that Best
Buy's alleged failure to protest to the specific CAM charges,
in and of itself, triggers the "voluntary payment" doctrine.
(See Def. Motion at 11-13.) The court disagrees.
In making this argument, Harlem-Irving relies on the court's
language in Smith v. Prime Cable of Chicago, 276 Ill. App.3d 843,
849, 658 N.E.2d 1325, 1331, 213 Ill. Dec. 304, 310 (1995).
Specifically, Harlem-Irving concludes that in the ordinary
situation, the payor must show protest before he can show
"compulsion." (See Def. Reply at 12.) However, the court in
Smith went on to say that "compulsion may appear from the
circumstances without a protest against payment." Id. 658
N.E.2d at 1331 (emphasis added). See Getto v. City of Chicago,
86 Ill.2d 39, 55 Ill.Dec. 519, 426 N.E.2d 844 (1981). See
generally 13 Williston on Contracts § 1623, at 770 (3d ed. 1970)
("Nor if a payment is obviously coerced will recovery be denied
because no protest was made.") Therefore the allegation (which is
disputed by Best Buy) that Best Buy did not protest to the
category of non-office wages and salaries is insufficient to
support an award of summary judgment in Harlem-Irving's favor.
Furthermore, Harlem-Irving argues that having made no protest,
Best Buy is unable to show duress. Best Buy withheld CAM
reconciliation payments for 1993 and 1994 until Harlem-Irving
attorney Edwin Wahlen warned twice in his June 23, 1995 letter,
that Harlem-Irving would pursue all remedies under the lease if
such payments were not made. Those remedies
included eviction*fn5. (See Pl.Resp. at 6.) Under the liberal
definition of "duress," recovery of a payment made under a claim
of right can occur:
"[w]here a person, to prevent injury to himself, his
business or property, is compelled to make a
payment of money which the party demanding has no
right to receive and no adequate opportunity is
afforded the payor to effectively resist such
Smith, 276 Ill.App.3d at 847, 213 Ill.Dec. 304, 658 N.E.2d at
1329. See Schlossberg v. E.L. Trendel & Assocs., Inc., 63 Ill. App.3d 939,
942, 944, 20 Ill.Dec. 741, 744, 380 N.E.2d 950, 953
(1978). Best Buy claims that the letter from Wahlen resulted in
its payment of 1993 and 1994 CAM charges (i.e. the letter
implicitly threatened injury, in the form of eviction, as to Best
Buy's business interests), while Harlem-Irving contends that
Best Buy's own size and conduct defeat any inference of duress in
that after receiving Wahlen's letter, Best Buy still submitted
protests about other aspects of CAM.
It is well-established that the issues of duress and compulsory
payment ordinarily are factual, to be judged in light of all
surrounding circumstances surrounding a given transaction.
Smith, 276 Ill.App.3d at 850, 213 Ill.Dec. 304, 658 N.E.2d at
1331. See also Pemberton v. Williams, 87 Ill. 15 (1877);
Schlossberg v. E.L. Trendel & Assocs., Inc., 63 Ill. App.3d 939,
942, 380 N.E.2d 950, 953, 20 Ill.Dec. 741, 744 (1978); Gerber v.
First National Bank, 30 Ill. App.3d 776, 332 N.E.2d 615 (1975).
Therefore, in light of the material factual dispute surrounding
the issue of duress and the application of the "voluntary
payment" doctrine, this court denies Harlem-Irving's summary
judgment motion on such grounds.
VI. "ACCORD AND SATISFACTION," "EXECUTORY ACCORD" AND "ACCOUNT
A. The Doctrine of "Accord and Satisfaction"