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Midway Park Saver, A Division of Counselors, Ltd v. Sarco Putty Company and Edward A. Sarsfield Iii

August 21, 2012

MIDWAY PARK SAVER, A DIVISION OF COUNSELORS, LTD.,
PLAINTIFF-APPELLANT,
v.
SARCO PUTTY COMPANY AND EDWARD A. SARSFIELD III,
DEFENDANTS-APPELLEES.



Appeal from the Capital Circuit Court of Cook County. No. 06 L 2038 Honorable Daniel J. Kelley and Charles R. Winkler, Judges Presiding.

The opinion of the court was delivered by: Justice Cunningham

JUSTICE CUNNINGHAM delivered the judgment of the court, with opinion. Presiding Justice Quinn and Justice Connors concurred in the judgment and opinion.

OPINION

¶ 1 This appeal arises from a January 12, 2007 order entered by the circuit court of Cook County which dismissed with prejudice count I of plaintiff-appellant Midway Park Saver's (Midway) complaint; an August 7, 2009 order which denied Midway's motion for reconsideration; and a June 11, 2010 order which dismissed with prejudice counts I and II of Midway's amended complaint. On appeal, Midway argues that: (1) the trial court erred in dismissing count I of Midway's original complaint; (2) the trial court erred in denying Midway's motion for reconsideration; and (3) the trial court erred in dismissing counts I and II of Midway's amended complaint. For the following reasons, we affirm in part, reverse in part, and remand the case to the circuit court of Cook County.

¶ 2 BACKGROUND

¶ 3 In 1993, Midway operated a public parking lot located east of Midway Airport at 4607 West 59th Street, Chicago, Illinois. Defendant-appellee Sarco Putty Company, an Illinois corporation, and Edward A. Sarsfield, corporate secretary of Sarco Putty Company (collectively Sarco), owned vacant land to the west and adjacent to Midway's parking lot. On September 30, 1993, Midway and Sarco entered into a lease agreement for Midway to lease Sarco's vacant land in order to expand its parking lot. The lease was to run from January 1, 1994 until December 31, 2002, with an option to extend the lease for three years until December 31, 2005. The lease allowed Midway to take possession of the vacant land on January 1, 1994, and payment of the first year's rent was due on that date. The lease also required Midway to make improvements to the vacant land at its own cost. The lease contained the following three provisions which are at issue in this case:

"3. Lessee at its own expense shall cause the premises to be improved by way of crushed rock and/or black-topped road and parking lot, erection of adjacent fences as allowable by the City of Chicago, installation of parking stalls, lighting and a service building on the premises; the cost of which including all permits will be borne by Lessee and Lessee shall indemnify Lessor and save Lessor harmless from any and all claims, liens, fines, charges, causes of action or any other encumbrances rising out of said construction or improvement of the premises. At the end of this lease any and all improvements presently then on the premises shall be considered as part of and be owned by Lessor. Lessee shall only have the right to remove such items that are removable and not those items that have become a permanent part of the demised premises.

4. Not [sic] withstanding the provision set forth in paragraph one hereof, Lessor agrees that the first year's payment of rent shall not begin until Lessee has fully installed all of the improvements as indicated above but that the installation of same shall be completed no later than December 31, 1993.

7. Lessor shall not be liable to Lessee for any damage or injury to him or his property occasioned by the failure of Lessor to keep the Premises in repair, and shall not be liable for any injury done or occasioned by wind or by or from any defect in plumbing, electric wiring or of insulation thereof, gas pipes, water pipes or steam pipes, or from broken stairs, porches, railings, or walks, or from the backing up of any sewer pipe or down-spout, or from the bursting, leaking or running of any tank, tub, washstand, water closet or waste pipe, drain or any other pipe or tank in, upon or about the Premises or the building of which they [a]re a part nor from the escape of steam or hot water from any radiator, it being agreed that said radiators are under the control of Lessee, nor for any such damage or injury occasioned by water, snow, or ice being upon or coming through the roof, skylight, trap-door, stairs, walks or any other place upon or near the Premises or otherwise, nor for any such damage or injury done or occasioned by the falling of any fixture, plaster or stucco, nor for any damage or injury arising from any act, omission or negligence of co-tenants or of other persons, occupants of the same building or of adjoining or contiguous buildings or of owners of adjacent or contiguous property, or of Lessor's agents or Lessor himself, all claims for any such damage or injury being hereby expressly waived by Lessee."

¶ 4 As stated in paragraph 3 of the lease agreement, there was a December 31, 1993 deadline for completion of all improvements. Midway made some improvements to the vacant land by December 31, 1993, and paid Sarco rent for the first year on January 1, 1994. Throughout the term of the lease during the later 1990s and early 2000s, Midway made numerous improvements to the parking lot, each time after consulting with Sarco and obtaining its approval. Midway continued to lease the parking lot from Sarco throughout the three-year option period from 2002 to 2005. During that time, Midway and Sarco were negotiating the terms of a new lease agreement. At some point in 2003, Midway began to notice that vandals were gaining entry to the parking lot and damaging cars parked there. Midway identified the vandals' access point as an area on the land that was leased from Sarco. Midway planned to block the vandals' access by erecting, at its own cost, an additional fence with razor wire. Midway proposed its plan to erect the additional fence to Sarco, and Sarco refused. Sarco claims that it did not allow Midway to erect the additional fence with razor wire because it wanted to get a new lease agreement signed and there were already fences in place around the property. Midway then hired additional parking lot personnel during the nighttime hours in an effort to stop the vandals; however, the vandalism continued.

¶ 5 The lease expired on December 31, 2005; however, Midway continued to occupy the land and pay its monthly rent. In January 2006, Sarco removed parking lot fencing clips and took down 15 feet of guardrail that Midway had installed. After removal of the fencing clips and guardrail, a customer's car was stolen from the parking lot and many other cars were vandalized. Lease negotiations between the parties broke down further and Midway began to vacate Sarco's property. Midway put up sawhorse barricades to mark the property line between Midway's parking lot and Sarco's land. In March 2006, after Midway had moved all of its operations from Sarco's property, Sarco removed the sawhorse barricades previously erected by Midway and put them inside Sarco's building.

¶ 6 On February 23, 2006, Midway filed a two-count complaint against Sarco in the circuit court of Cook County claiming that: (1) Sarco breached the lease agreement between the parties because it refused to allow Midway to erect the additional fence with razor wire; and (2) Sarco's removal of the fencing clips and guardrail that Midway had installed constituted willful and wanton misconduct. On May 5, 2006, Sarco filed a motion to dismiss Midway's complaint pursuant to section 2-619 of the Illinois Code of Civil Procedure (the Code) (735 ILCS 5/2-619 (West 2004)). On January 12, 2007, the parties appeared in the circuit court of Cook County for argument on Sarco's motion to dismiss. The court granted with prejudice Sarco's motion to dismiss count I of Midway's complaint for breach of the lease agreement. The court ruled that the terms of the lease agreement were unambiguous and clearly stated that all improvements were to be completed by December 31, 1993. However, the court denied Sarco's motion to dismiss count II of Midway's complaint for willful and wanton misconduct. Specifically, the court ruled that Midway was a holdover tenant in 2006, and not a tenant in sufferance as Sarco argued, when Sarco removed the fence clips and guardrail that Midway installed. The court found that Sarco did not have the right to remove the fence clips and guardrail against Midway's wishes because Midway still had an interest in the property.

¶ 7 On February 13, 2008, the parties appeared for a case management conference in the circuit court of Cook County in front of a different judge who was the successor to the judge who had made the earlier rulings. On April 30, 2009, Midway filed a motion for reconsideration of the January 12, 2007 order dismissing count I of Midway's complaint for breach of the lease agreement. On August 7, 2009, the successor judge denied Midway's motion for reconsideration and found that there was no legal reason why the January 12, 2007 order of his predecessor should be vacated. Midway's motion for leave to file an amended complaint was granted on January 19, 2010. On February 18, 2010, the trial court gave Sarco until March 11, 2010 to answer or otherwise plead. On March 2, 2010, Midway filed a three-count amended complaint alleging that: (1) because the parties had modified the terms of the lease agreement, Sarco breached the lease agreement between the parties by refusing to allow Midway to erect the additional fence; (2) Sarco's removal of the fence clips and guardrail that Midway installed breached the implied covenant of quiet enjoyment; and (3) Sarco's removal of Midway's property line barricades constituted conversion.

ΒΆ 8 On March 19, 2010, Midway filed a motion for default because Sarco had yet to answer. On March 25, 2010, Sarco filed a motion to dismiss Midway's amended complaint pursuant to section 2-619 of the Code. On June 11, 2010, the trial court granted with prejudice Sarco's motion to dismiss Midway's amended complaint as to count I for breach of the lease agreement and count II for breach of the implied covenant of quiet enjoyment. The trial court reasoned that counts I and II in the amended complaint were "substantially similar to what was decided by [the prior judge] on [January 12, 2007] and this court on [August 7, 2009]." The court also found that no new contract was created between the parties as a matter of law. The court denied Sarco's motion to dismiss as to ...


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