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Kelly v. Orrico

Court of Appeals of Illinois, Second District

March 31, 2014

BRIAN KELLY and NICOLE KELLY, Plaintiffs-Appellees,
LARRY ORRICO and RENAE YOCKEY, Defendants-Appellants

Appeal from the Circuit Court of Du Page County. No. 09-L-1603. Honorable Kenneth L. Popejoy, Judge, Presiding.



The judgment entered for plaintiffs based on the trial court's conclusion that defendants anticipatorily repudiated their contract to purchase plaintiffs' house was reversed, since the doctrine of anticipatory repudiation did not apply where defendants' announcement that they would not close the deal occurred only after plaintiffs informed them that they had another buyer for the house, and the announcement was no more than an ambiguous implication as to whether defendants would close the contract, and, under those circumstances, the finding of anticipatory repudiation was against the manifest weight of the evidence.

For Plaintiffs-Appellees: Robert G. Black, Law Offices of Robert G. Black, Naperville, Illinois; Scott M. Day, Day & Robert, P.C., Naperville, Illinois.

For Defendants-Appellants: Thomas A. Christensen, Brian K. LaFratta, Huck Bouma, P.C., Wheaton, Illinois.

JUSTICE HUTCHINSON delivered the judgment of the court, with opinion. Justices McLaren and Spence concurred in the judgment and opinion.



Page 1056

[¶1] Following a bench trial, the trial court entered a judgment in favor of plaintiffs, Brian Kelly and Nicole Kelly, and against defendants, Larry Orrico and Renae Yockey, after concluding that defendants had anticipatorily repudiated their contract with plaintiffs. The parties had entered into a contract for defendants to purchase plaintiffs' home, and plaintiffs filed suit when defendants failed to close on the purchase by August 20, 2008. Defendants now appeal, contending that (1) the trial court's judgment did not match plaintiffs' pleadings, which alleged a breach-of-contract theory of relief; (2) the record failed to support a finding of defendants' anticipatory breach; (3) plaintiffs' election of remedies under a separate contract that they had with a third party to purchase their home precluded a judgment against defendants; and (4) plaintiffs did not suffer damages. For the reasons set forth below, we reverse the trial court's judgment.

[¶2] I. Background

[¶3] The record reflects that plaintiffs owned a house on East Bryn Mawr Avenue

Page 1057

in Itasca. Defendants lived two doors from plaintiffs, and the parties were friends. On July 12, 2007, the parties entered into a contract for defendants to purchase plaintiffs' house for $1.2 million, with the closing date set for May 2, 2008. The parties also agreed that Nicole Kelly, a licensed realtor, would list defendants' house for sale.

[¶4] On May 2, 2008, the parties agreed that the closing date would be rescheduled to August 20, 2008. The parties also agreed that plaintiffs would list their house for sale.

[¶5] On June 19, 2008, plaintiffs entered into a contract with Michael and Cindy Disilvestro for the Disilvestros to purchase plaintiffs' home for $1.2 million. Brian Kelly telephoned Yockey to advise her of the Disilvestros' offer, and defendants did not object. Plaintiffs and the Disilvestros set their closing date for October 8, 2008.

[¶6] On July 25, 2008, plaintiffs' attorney sent defendants a correspondence advising that plaintiffs would consider defendants in breach of the July 12, 2007, contract unless defendants performed their contractual obligations. On August 21, 2008, plaintiffs' attorney sent defendants a letter notifying them of their breach.

[¶7] Thereafter, the Disilvestros defaulted on their contract with plaintiffs. As a result, the Disilvestros forfeited $50,000 in earnest money to plaintiffs. On May 4, 2009, plaintiffs entered into a contract to sell their home to Brian Gerber, who purchased plaintiffs' home for $1 million.

[¶8] On December 23, 2009, plaintiffs filed against defendants their single-count complaint alleging breach of contract. Plaintiffs alleged that they had performed their contractual obligations, defendants " failed to perform their obligations as [they] failed to close on the purchase of [plaintiffs' house] on the agreed upon extended closing date of August 20, 2008," and defendants' breach proximately caused plaintiffs damages. Defendants raised various affirmative defenses, including waiver, equitable estoppel, release, lack of consideration, and laches .

[¶9] A bench trial commenced on October 9, 2012. Brian Kelly testified first on plaintiffs' behalf. Brian testified that in May 2008 he had a conversation with defendants regarding their contract. Brian testified that defendants advised him that they were not going to be able to purchase plaintiffs' house, because defendants had been unable to sell their home. Brian told defendants that their contract was not contingent on defendants being able to sell their home or being able to obtain financing. Brian testified that " there was no conversation whatsoever" about defendants being released from their contractual obligations. Brian continued:

" I basically told them, well, if you guys do not have an intention of purchasing the house, that I would go ahead and put the home for sale. If I had interest or a potential buyer, than [ sic ] I would contact them again, and we could just take it from there."

Brian testified that defendants agreed that plaintiffs could list their house, but that there was no discussion that plaintiffs placing their house on the market would release defendants from the contract. Brian testified that, " if something else comes about," the parties could then " figure out what the best remedy to the situation is."

[¶10] Brian testified that the Disilvestros offered to purchase plaintiffs' house for $1.2 million. Brian testified that he called Yockey in June 2008 to inform her of the Disilvestros' offer and to discuss " where we were with everything." Brian testified that he explained to Yockey ...

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