Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

T.C.T. Building Partnership v. Tandy Corporation

May 31, 2001

T.C.T. BUILDING PARTNERSHIP, AN ILLINOIS PARTNERSHIP, PLAINTIFF-APPELLANT,
v.
TANDY CORPORATION, A TEXAS CORPORATION, DEFENDANT-APPELLEE.



The opinion of the court was delivered by: Justice Hoffman

Not Released For Publication

T.C.T. BUILDING PARTNERSHIP, AN ILLINOIS PARTNERSHIP, PLAINTIFF-APPELLANT,
v.
TANDY CORPORATION, A TEXAS CORPORATION, DEFENDANT-APPELLEE.

The opinion of the court was delivered by: Justice Hoffman

APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY

HONORABLE ELLIS E. REID, JUDGE PRESIDING.

 The plaintiff, T.C.T. Building Partnership, appeals from a judgment entered in favor of the defendant, Tandy Corporation, in this action to enforce a lease guaranty. For the reasons which follow, we reverse the judgment of the circuit court and remand this cause for further proceedings.

The relevant facts are not in dispute. DuBose Corporation (DuBose) leased a parcel of commercial real estate to Color Tile of Illinois, Inc. (Color Tile). The lease was for an original term of twenty years commencing on March 5, 1975, and terminating on March 4, 1995, and granted Color Tile an option to extend the lease for four additional terms of five years each. The lease provided, however, that, to exercise the option, Color Tile was required to give DuBose written notice of its intent to renew the lease "at least six (6) months prior to the expiration of the original term *** or six (6) months prior to the expiration of the term of any renewal or extension". The defendant executed a guaranty of Color Tile's obligations under the lease. Under the terms of the guaranty, the defendant agreed, in part, to:

"absolutely and unconditionally guarantee[] to Lessor, its successors and assigns, the prompt and punctual payment of all rents and all other sums to be paid by the Lessee under said lease during the full term thereof, and during the period of any extension or renewal thereof, and the full, complete and faithful performance by Lessee of all of the provisions, covenants, agreements, conditions and stipulations in said Lease contained, to be kept, observed and performed by the Lessee during the full term of said Lease and during the period of any extension or renewal thereof * * *."

On March 10, 1975, the plaintiff purchased the property which was the subject of the lease and became the successor to DuBose's interest in both the lease and the defendant's guaranty.

On September 6, 1994, Color Tile gave the plaintiff written notice of its intent to renew the lease for an additional five-year term. The parties agree that this notice was not given, as required by the lease, at least six months prior to the March 4, 1995, termination of the original lease term. In order to strictly comply with the notice provision, Color Tile would have to have given notice on or before September 4, 1994. The plaintiff, nonetheless, accepted the notice and extended the term of the lease from March 5, 1995, to March 4, 2000.

In January of 1996, Color Tile filed for protection under Chapter 11 of the United States Bankruptcy Code (11 U.S.C §1101 et seq. (1996)). Color Tile remained in possession of the subject property and continued to make rental payments through August of 1997. However, subsequent to January 1996, Color Tile failed to pay the general real estate taxes levied against the property as required by the terms of the lease, resulting in a tax sale on January 14, 1997. Additionally, Color Tile failed to maintain liability and fire insurance as required by the lease, and as a consequence, the plaintiff was forced to purchase the insurance.

On June 25, 1997, and again on July 10, 1997, the plaintiff made written demand upon the defendant to honor its obligations under the guaranty. The defendant declined and, on September 23, 1997, the plaintiff filed the instant action.

In count I of its complaint, the plaintiff sought a declaration that the defendant's guaranty remains in full force and effect and that the defendant is liable for all sums due and owing from Color Tile under the terms of the lease. In count II, the plaintiff sought a $50,000 judgment against the defendant for breach of its guaranty. The defendant answered the complaint, admitting that it refused to perform Color Tile's obligations under the lease but denying that it was obligated to do so.

The case proceeded to a bench trial. At the conclusion of the plaintiff's case-in-chief, the defendant moved for judgment in its favor. The defendant did not dispute that it agreed to guaranty the obligations of Color Tile during the original term of the lease and any extension thereof. It argued, however, that, because Color Tile failed to exercise its option to extend the lease on or before September 4, 1994, as required by the terms of the lease, it was released of any liability to the plaintiff for a default by Color Tile occurring after the original lease term expired on March 4, 1995. In response, the plaintiff argued that the deviation from the terms of the lease was so minor that it did not result in a release of the defendant's obligations under the guaranty. The plaintiff also argued that, under the terms of the guaranty, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.