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Yellow Book Sales and Distribution Company, Inc v. David Feldman

November 15, 2012

YELLOW BOOK SALES AND DISTRIBUTION COMPANY, INC., PLAINTIFF-APPELLEE,
v.
DAVID FELDMAN, DEFENDANT-APPELLANT.



Appeal from the Circuit Court of Cook County, Illinois, County Department, Municipal Division. No. 11 M1 123590 Honorable Sheryl A. Pethers, Judge Presiding.

The opinion of the court was delivered by: Justice Fitzgerald Smith

JUSTICE FITZGERALD SMITH delivered the judgment of the court, with opinion. Presiding Justice Lavin and Justice Pucinski concurred in the judgment and opinion.

¶ 1 OPINION

¶ 2 This is a collection case, arising from several contracts entered into by the plaintiff, Yellow Book Sales and Distribution Company, Inc. (Yellow Book), and the defendant, David Feldman (Feldman). As president of Glassworks, Inc. (Glassworks), Feldman negotiated and signed four contacts for advertising services with Yellow Book. On each occasion, Feldman signed the contracts with his name, followed, by "President" or "Pres." When Glassworks went out of business and failed to pay the remaining balance owed on the four contracts, Yellow Book sued Feldman as the purported guarantor. Following a bench trial, the court found Feldman personally liable under the guarantee. The parties then stipulated to the judgment amount ($13,178.01). Feldman now appeals, contending that the trial court's finding that he intended to be bound personally under the guarantee was against the manifest weight of the evidence. For the reasons that follow, we affirm.

¶ 3 I. BACKGROUND

¶ 4 The record reveals the following pertinent facts and procedural history. On May 3, 2011, Yellow Book filed a complaint against Feldman, alleging that he owed Yellow Book the amount of $13,651.49 in damages, as guarantor on contracts Feldman had entered into on behalf of Glassworks for advertising services between 2007 and 2009. In support of this contention, Yellow Book attached copies of four contracts signed by Feldman on behalf of Glassworks. These contracts were executed on December 5, 2007, May 14, 2008, December 11, 2008, and August 6, 2009.*fn1 All four documents are form contracts and contain identical language. Each contract clearly states that the contracting parties are Yellow Book and its "Customer," Glassworks, but each is signed by Feldman. The contracts are two-sided, with the back side containing boilerplate language in fine print. The bottom right of the front side of each form contract has a three-line signature block, written in fine print. It contains the following language:

THIS IS AN ADVERTISING CONTRACT BETWEEN YELLOW BOOKS SALES AND DISTRIBUTION COMPANY, INC. OR YP TEL. AND and Print Customer Name

Authorized Signature individually and for the Customer. (Read Paragraph 14G on the reverse hereof) Title

Print Signer's Name Date

¶ 5 Each of the four contracts contain "Glassworks, Inc." above the "Print Customer Name" line. Feldman's signature appears on the second line of each contract and his name is followed by either "Pres." or "President." Feldman's name is printed on the following line.

¶ 6 Paragraph 14G of the form contracts, referred to in the signature block and found on the back side, is written in fine print and states:

"The signer agrees that he/she has the authority and is signing this agreement (1) in his/her individual capacity, (2) as a representative of the Customer, and (3) as a representative of the entity identified in the advertisement or for whose benefit the advertisement is being purchased (if the entity identified in the advertisement is not the same as the Customer or the signer). By his/her execution of this agreement, the signer personally and individually undertakes and assumes, jointly and severally with the Customer, the full performance of this agreement, including payment of amounts due hereunder."

¶ 7 After Feldman answered Yellow Book's complaint denying the allegations therein, the parties both filed pretrial briefs with the circuit court. In its brief, Yellow Book asked the circuit court to hold that the contract was enforceable as written as a matter of law, and that Feldman should not be allowed to introduce any extrinsic evidence as to the parties' intent. Yellow Book sought that the court apply the "four corners" doctrine and uphold the contract against Feldman simply on the basis of his signature. Feldman, on the other hand, argued in his brief that the contract was ambiguous as written and that he should therefore be permitted to testify regarding the parties' intent.

¶ 8 The circuit court agreed with Feldman and found, as a matter of law, that the contract was ambiguous as to whether Feldman intended to bind himself personally to the corporate obligations because he had written his corporate title (i.e., "President" or "Pres.") next to his signature. The circuit court further found that a trial was necessary to determine whether Feldman intended to be personally bound by the contract. The court noted it would hear testimony "about the parties' intent" and "who thought what."

¶ 9 In coming to this decision the circuit court explained:

"If Yellow Book wants this thing to be, you know, upheld in Illinois courts over and over again, the least they could do is not have the person put their title next to it. That would help.

I don't know that that would help every Illinois court, because it's certainly within Yellow Book's power to to putting [sic] great big letters, this is a personal guarantee, and have the person sign twice. And then there would be no factual dispute as to liability, and that's totally within Yellow Book's control.

And it looks to me so much like Yellow Book is trying to bury this in an interesting way that might appeal to judges. It's like a game. And I don't think personal guarantees should be a game."

¶ 10 During the bench trial, the parties offered testimony of several witnesses. First, Yellow Book paralegal Tasha Drew identified the four contracts at dispute in this litigation as plaintiff's exhibit Nos. 1 through 4.*fn2 She testified that all four contracts were standard Yellow Book advertisement contracts. Drew also identified exhibit No. 5 as Yellow Book's customer contact log for Glassworks. She testified that the contact log contained no complaints regarding the charges on the Glassworks account, nor anything to indicate that Feldman called into the Yellow Book offices disputing his individual liability on the account.

ΒΆ 11 Drew explained that the Glassworks account was sent to a collection agency on July 29, 2010, and then to collection law firm on October 1, 2010, after Glassworks failed to pay the amounts it owed on the four contracts. She testified, however, that after the claim was placed with the collection agency and the collection law firm, Feldman signed another contract on behalf of Glassworks on November 16, 2010. That contract was entered into evidence as plaintiff's exhibit No. 6. According to Drew, this contract was paid in full at the time it was signed. In that way, it differed from the four contracts in dispute, which were to be paid on a monthly basis. Drew explained that Yellow Book's policy was that if a customer owed a balance on any account, in order to buy new advertisements and ...


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