Appeal from the Circuit Court of the 14th Judicial Circuit, Rock Island County, Illinois No. 99--SC--3598 Honorable Dennis DePorter Judge, Presiding
The opinion of the court was delivered by: Justice Breslin
The plaintiff, Curtis Investment Firm, Ltd. Partnership (Curtis Investment), brought an action against the defendants, Robert and Susan Schuch, alleging failure to disclose a defective water supply line. The trial court entered judgment for Curtis Investment in the amount of $1,532.50, plus costs. On appeal, the Schuches claim that Curtis Investment waived any right to recovery under the Residential Real Property Disclosure Act (Act) (765 ILCS 77/1 et seq. (West 1998)) by failing to demand a disclosure report prior to closing. The Schuches also argue that the judgment was erroneous because they had no actual knowledge of the defect at the time of sale. We determine that the Act is mandatory and cannot be waived. In addition, we defer to the trial court's finding of actual knowledge in that it was not against the manifest weight of the evidence.
Curtis Investment entered into a contract to purchase a piece of residential property owned by the Schuches. Approximately six weeks prior to the closing, Curtis Investment requested a real property disclosure report. The Schuches did not provide the report. The closing proceeded without any written contingencies and Curtis Investment purchased the home.
Prior to the sale, the Schuches had the home's water supply turned off at the curb box rather than at the interior meter. When Curtis Investment attempted to reinitiate the water supply, it discovered that the supply line between the curb box and the house was faulty. The interior water system needed repair as well. Curtis Investment repaired the water supply system at its own expense. At the time of trial, the repairs totaled $1532.50. Curtis Investment filed a small claims suit against the Schuches seeking to recover the cost to replace the water supply system. During the trial, Robert Schuch denied any knowledge of a problem with the supply line or the residential system. The trial court held that under the Act, a buyer cannot waive its right to receive a disclosure report. The court found that the Schuches knew the water supply line was defective and entered judgment for Curtis Investment for the cost to repair the system. The Schuches appeal.
On appeal, the Schuches first argue that, contrary to the trial court's holding, a buyer can waive its right to receive a real property disclosure statement if the buyer signs a contract for purchase without receiving a residential disclosure statement.
The primary rule of statutory construction is to ascertain and give effect to the intent of the legislature. Miller v. Bizzell, 311 Ill. App. 3d 971, 726 N.E.2d 175 (2000). The court should first consider the statutory language itself. When the language of the statute is clear, it should be given effect without resorting to other aids of construction. People ex rel. Baker v. Cowlin, 154 Ill. 2d 193, 607 N.E.2d 1251 (1992). Legislative use of the word "shall" is generally considered to express an intent that the provision be mandatory. Hoffman Estates Professional Firefighters Assn. v. Village of Hoffman Estates, 305 Ill. App. 3d 242, 711 N.E.2d 1109 (1999).
Section 20 of the Act provides that:
"A seller of residential real property shall complete all applicable items in the disclosure document described in Section 35 of this Act. The seller shall deliver to the prospective buyer the written disclosure statement required by this Act before the signing of a written agreement by the seller and prospective buyer that would, subject to the satisfaction of any negotiated contingencies, require the prospective buyer to accept a transfer of the residential real property." (Emphasis added.) 765 ILCS 77/20 (West 1998).
We find the use of the word "shall" in this section requires a mandatory reading of the provision. The plain language of the statute mandates that the buyer be provided a disclosure statement before closing on a residential sale. The statute does not list any exceptions. We therefore hold that a buyer cannot waive the seller's responsibility to disclose certain defects by signing a contract without receipt of a written disclosure statement.
We reject the Schuches' assertion that the language of section 20 gives the buyer the option to waive receipt of the report. The Schuches maintain that section 20 provides that the disclosure report is "subject to the satisfaction of any negotiated contingencies." They claim that one such negotiation could be the waiver of the disclosure statement. However, a reading of the entire section clearly demonstrates that the "subject to" language relates to the written agreement to purchase the property, not the seller's disclosure statement. Accordingly, the trial court's determination that a buyer cannot waive receipt of a real property disclosure report was correct.
Other provisions of the Act require a mandatory reading of the statute as well. Section 55 provides that "[a] person who knowingly violates or fails to perform any duty prescribed by any provision of this Act or who discloses any information on the Residential Real Property Disclosure Report that he knows to be false shall be liable in the amount of actual damages and court costs." 765 ILCS 77/55 (West 1998). The language in this provision demonstrates that the legislature intended mandatory liability in the event the seller fails to comply with the Act. Consequently, a seller cannot fail or refuse to provide a disclosure report with impunity. *fn1
Finally, consideration of the objective of the statute supports our conclusion that a buyer's right to receive a disclosure statement prior to closing cannot be waived. The primary purpose of the statute is to provide a remedy for aggrieved buyers of residential real property. See 90th Ill. Gen. Assem., House Proceedings, May 20, 1997, at 6. To allow a seller to ignore his obligation under the Act to avoid reporting a material defect and defeat a buyer's subsequent claim would only encourage the evils the legislature sought to remedy. See People v. Peters, 180 Ill. App. 3d 850, 536 N.E.2d 465 (1989) (court should consider objective of the statute and evils legislature sought to remedy and arrive at a ...