that Sylvester was the father of William and Samuel. This testimony was
found credible by the Probate Court and was corroborated by other
information in the Bank's possession, including Samuel's handwritten
letter, Samuel's death certificate which named Sylvester as his father,
the fact that both William and Samuel had the last name "Jefferson," the
representations by William's attorney, and the statement of Lola's cousin
to Trent at IGS. In light of the information in the Bank's possession, it
was not unreasonable for the Bank to conclude that no further
investigation was necessary. This court further notes that Stratman had
attempted to obtain information from the VA regarding Sylvester's family
and was unsuccessful. This court declines to find that the Bank had a
duty to obtain a VA file it did not know existed and did not know
contained pertinent information.
In addition, this court notes that none of the documents submitted to
this court, with the exception of Plaintiffs' affidavits, could have led
the Bank or anyone else to locate Plaintiffs as relatives of Sylvester.
As noted, there is no dispute that the Bank was not aware of the
existence of Plaintiffs at any time before Plaintiffs filed their
petition to vacate the judgment in the Probate Court. See Matter of
Jones, 379 Mass. 826, 401 N.E.2d 1351, 358 (1980) (conservator had no
actual knowledge of the existence of any heirs and possessed no
information which, if pursued, might have led to the discovery of
kindred); cf. Smith By Young v. Estate of King, 579 So.2d 1250, 1251
(Miss. 1991) (an administrator is under an affirmative duty to disclose
to the court the existence of known potential heirs and claimants). This
court also rejects Plaintiffs' suggestion that the Bank should have'
published its notice in Jackson County, where Sylvester was living before
he died, or in the St. Louis area, where he spent the early years of his
life. This court notes that publication in either of those venues would
not have been any more likely to reach Plaintiffs than the publication in
Vermilion County. As noted, Plaintiffs are residents of California and
Plaintiffs finally argue that a genuine issue of material fact exists
regarding whether the Bank breached its fiduciary duties when it hired
IGS. Plaintiffs contend that White and Trent both testified that the Bank
hired IGS solely to locate William and Samuel, not to determine who were
the actual heirs of Sylvester. This court has carefully and thoroughly
reviewed the deposition transcripts of White and Trent. This court
concludes that Plaintiffs have mischaracterized their testimony. White
testified that the intent of the search was to ascertain the identity of
the persons referred to in the handwritten letter. White said that the
Bank wanted IGS to resolve "whether those two persons were the sons of
Sylvester Jefferson." White further stated that he determined that "the
identities of these two individuals in this letter would be the most
likely way of getting some answers in a quick amount of time." Treat
testified that the task of IGS was to locate William and Samuel Jefferson
and, if possible, attempt to determine their relationship to Sylvester.
Treat stated that William and Samuel "needed to be identified and find
out what their relationship was." Treat did testify that it did not make
any difference to her whether William or Samuel were related to
Sylvester. However, Trent's testimony, taken as a whole, showed that her
task was to locate William and Samuel and find out their relationship to
This court concludes that the actual statements of White and Trent do
not support an inference that the Bank hired IGS solely to find William
and Samuel, without regard to whether William and Samuel were actually
Sylvester's heirs. Based upon this record, there is no genuine issue of
material fact as to whether the Bank breached its fiduciary duty when it
hired IGS, with Probate Court approval. See Jones, 401 N.E.2d at 358-59
(conservator not required to retain the services of a professional
Based upon the pertinent case law, this court concludes that the Bank
did not breach any fiduciary duty owed to Plaintiffs. Accordingly, the
Bank is entitled to judgment in its favor as a matter of law.
III. THIRD PARTY BENEFICIARY CLAIMS
In their Complaint, Plaintiffs claim that they were third party
beneficiaries of the contract between IGS and the Bank. They further
claim that IGS is liable to them for breach of the contract and for
breach of implied warranties. In its Motion for Summary Judgment, IGS
first argues that Plaintiffs are not third party beneficiaries of the
contract between the Bank and IGS.
If a contract is entered into for the direct benefit of a third
person, the third person may sue for a breach of the contract in his or
her own name, even though the third person is a stranger to the contract
and the consideration. Olson v. Etheridge, 177 Ill.2d 396, 226 Ill.Dec.
780, 686 N.E.2d 563, 566 (1997). For a third party to have a cause of
action, "[t]he contract must be undertaken for the plaintiff's direct
benefit and the contract itself must affirmatively make the intention
clear." Lippert Marketing, Ltd. v. Kingwood Ceramics, Inc., 1998 WL
699023, at *19 (N.D.Ill. 1998) (quoting Waterford Condominium Ass'n v.
Dunbar Corp., 104 Ill. App.3d 371, 60 Ill.Dec. 110, 432 N.E.2d 1009, 1011
(1982)). Illinois follows the "intent to benefit" rule. XL Disposal
Corp. v. John Sexton Contractors Co., 168 Ill.2d 355, 213 Ill.Dec. 665,
659 N.E.2d 1312, 1316 (1995). Under that test, third-party beneficiary
status is a matter of divining whether the contracting parties intended
to confer a benefit upon a nonparty to their agreement. XL Disposal
Corp., 213 Ill.Dec. 665, 659 N.E.2d at 1316; see also Ahern v. Board of
Educ. of City of Chicago, 133 F.3d 975, 983 (7th Cir. 1998). It is not
enough that a party receive merely an incidental benefit. Ahern, 133 F.3d
Plaintiffs' contract claim is based on IGS's May 10, 1995, letter to
Krapf. This letter included a "Results or No Charge" fee quotation "to
provide professional search services on your behalf." IGS proposed a
$4,150 fee "[t]o prove or disprove the existence of descendants of
Sylvester Jefferson, alive or deceased, within 90 days of commencing our
search" and an additional $195 fee per person "[t]o further identify,
locate, prove and report each individual as a descendant of Sylvester
Jefferson." IGS attached a copy of a "To Whom it May Concern" letter and
asked that the Bank prepare the letter on Bank letterhead. The Bank did
so, and the letter stated that the Bank authorized IGS to represent the
Bank "in the locating of the heirs at law of Sylvester W. Jefferson." The
letter also stated that IGS was authorized to obtain public and private
records "necessary to establish and identify next of kin, heirs at law
and collateral relatives of the deceased, Sylvester W. Jefferson." On
June 14, 1995, IGS sent a letter to Krapf stating that it had commenced a
search on the basis of the terms set out in the quotation of May 10,
The parties have not cited and this court has not found any Illinois
case law, or indeed any case law, which holds that the heirs of an estate
are third-party beneficiaries of a contract between the administrator of
an estate and an heir search firm such as IGS. Nevertheless, this court
concludes that the heirs of the estate are clearly intended beneficiaries
of such a contract.
However, for Plaintiffs to recover as third-party beneficiaries to the
contract, they must establish that IGS breached its contract with the
Bank. To "sustain a cause of action for breach of contract, a plaintiff
must establish that there was a wrongful act and that a loss or damages
resulted directly from it." Jackson v. Hammer, 274 Ill. App.3d 59, 210
Ill.Dec. 614, 653 N.E.2d 809, 813 (1995), app. denied, 164. Ill.2d 565,
214 Ill.Dec. 321, 660 N.E.2d 1270 (1995). As IGS points out, a
third-party beneficiary cannot expand the "liability of the promisor."
See Carson Pirie Scott & Co. v. Parrett,
346 Ill. 252, 178 N.E. 498, 501 (1931); see also Altevogt v.
Brinkoetter, 85 Ill.2d 44, 51 Ill.Dec. 674, 421 N.E.2d 182, 187 (1981).
The language of the May 10, 1995, letter stated that, in return for a
proposed fee, IGS promised "[t]o prove or disprove the existence of
descendants of Sylvester Jefferson, alive or deceased, within 90 days of
commencing our search" and "[t]o further identify, locate, prove and
report each individual as a descendant of Sylvester Jefferson."
The undisputed facts in this case show that IGS located William and
Gregory. Although IGS was not able to obtain documentation showing they
were descendants of Sylvester, Treat testified that "to the best of the
information we were able to develop . . . [t]here was the appearance that
they were the sons of Sylvester Jefferson." Trent stated that she was
able to obtain oral statements to support this conclusion. Further, when
IGS was unable to obtain birth certificates for William and Samuel, it
did the only thing it could do. It notified Krapf that it could not
obtain the birth certificates and advised Krapf to subpoena them.
Unfortunately, Krapf was similarly unsuccessful in obtaining the birth
certificates. However, following IGS's location of William and Gregory,
Gregory testified in the Probate Court that William and Samuel were
Sylvester's sons and that he and William were Sylvester's heirs.
Subsequently, William also testified and confirmed that Sylvester was his
"daddy." This court concludes that oral testimony in open court was
"proof" that William and Gregory were descendants of Sylvester. This court
notes that, based upon the record before this court, it appears that both
Gregory and William were not being dishonest when they testified, but
were stating what they believed to be the truth.
This court concludes that, based upon the extremely unique facts and
circumstances of this case, IGS fully performed its obligations under the
terms of its contract with the Bank. This court further notes that, once
the Probate Court entered its Order finding that William and Gregory were
Sylvester's heirs, there was no need for IGS to proceed any further.
Accordingly, Plaintiffs cannot recover as third-party beneficiaries for
breach of the contract.
IGS next argues that Plaintiffs' claim based upon implied warranties
must fail because sales of services do not carry implied warranties. This
court agrees that, other than two narrow exceptions which do not apply
here, "the recognition of implied warranties has been limited to the sale
of goods, not services." American Labelmark Co. v. Akiyama Corp. of
America, 1993 WL 460838, at *2 (applying Illinois law). In their Response
to IGS's Motion for Summary Judgment, Plaintiffs concede that they cannot
have a claim based upon implied warranties. However, Plaintiffs now argue
that they have a claim based upon an express warranty. Plaintiffs
acknowledge that they did not specifically plead breach of express
warranty but argue "such a claim should be allowed under the liberal
federal notice pleading rules."
An action for breach of an express warranty in a service contract is
recognized in Illinois. Oak State Products, Inc. v. Ecolab, Inc.,
755 F. Supp. 235, 237 (C.D.Ill. 1991). In order to succeed on a claim
based upon the breach of an express warranty, a plaintiff must prove (1)
that the defendant made a warranty regarding a material fact; (2) that
the warranty was made for the purpose of inducing the plaintiff to enter
into the contract; and (3) that the plaintiff relied on the defendant's
warranty. St. Francis Hosp., 1995 WL 387793, at *4 An express warranty in
a contract is to be interpreted in a manner that is consistent with the
clear and natural import of the language used and in consideration of the
subject matter. Board of Managers of Winston Towers No. 4 Condominium
Ass'n v. Westinghouse Electric Corp., 1992 WL 168786, at *3 (N.D.Ill.
1992) (citing Illinois Valley Asphalt, Inc. v. LaSalle Nat'l Bank, 54
III.App.3d 317, 12 Ill.Dec. 28, 369 N.E.2d 525,
529 (1977)). A third-party beneficiary may sue for the breach of an
express warranty. See In re Masonite Corp. Hardboard Siding Products
Liability Litigation, 21 F. Supp.2d 593, 599-600 (E.D.La. 1998).
In support of their claim for breach of express warranty, Plaintiffs
argue: "[t]he intention of the parties is . . . to be gleaned from the
letter of May 10, 1995, which all agree contains the terms and provisions
of the engagement agreement; and the letter clearly states that IGS was
to and identify Sylvester's descendants." This court agrees that this was
the only express warranty included in the May 10, 1995, letter. This
court has already concluded that, under the unique facts present here,
IGS performed this promise. While Plaintiffs have found much to criticize
regarding IGS's performance, they have not referred to any documents
which IGS could have located which could have led IGS to identify
Plaintiffs as heirs of Sylvester. As a result, Plaintiffs cannot recover
from IGS based upon a breach of an express warranty. Therefore, IGS is
entitled to judgment as a matter of law.
Because this court has concluded that the undisputed facts establish
that the Bank did not breach its fiduciary duty as administrator of
Sylvester's estate and IGS did not breach its contract with the Bank,
there is no need for this court to consider the other arguments raised by
Defendants in support of their Motions for Summary Judgment. This court
does note, however, that it finds Defendants' estoppel arguments
persuasive. The undisputed facts show that Plaintiffs knew they were
potential beneficiaries of Sylvester's estate at least as early as
September 1995, when they entered into a contract with ARB. This was well
before the Probate Court made its heirship finding, well before any
distributions were made of the estate assets and well before the estate
was closed. However, neither Plaintiffs nor ARB took any action regarding
Sylvester's estate until January 1997. This court believes that
Plaintiffs may well be estopped from bringing any action based upon their
own inaction, and the inaction of ARB, which was acting on their behalf.
See Bituminous Trucking & Equip. Co. v. Delta Air Lines, Inc.,
189 F.2d 307, 310 (7th Cir. 1951); see also In re Walton Hotel Co.,
116 F.2d 110, 112 (7th Cir. 1940); Jurek v. Smuczynski, 61 Ill. App.2d 426,
209 N.E.2d 850, 853 (1965).
IT IS THEREFORE ORDERED THAT:
(1) The Bank's Motion for Summary Judgment (#14) is GRANTED.
(2) IGS's Motion for Summary Judgment (#25) is GRANTED.
(3) Because Judgment has been entered in favor of both Defendants, the
Bank's Cross-Claim (#38) against IGS is dismissed as moot.
This case is terminated. The parties shall be responsible for their own
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