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Work Zone Safety, Inc. v. Crest Hill Land Development, L.L.C.

Court of Appeals of Illinois, First District, Second Division

March 10, 2015

WORK ZONE SAFETY, INC., Plaintiff-Appellant,

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[Copyrighted Material Omitted]

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Appeal from the Circuit Court of Cook County. No. 10 CH 38661. Honorable Thomas R. Allen, Judge Presiding.

For Appellant: William H. Hrabak, Jr., Sara L. Spitler, of counsel, Goldstine, Skrodzki, Russian, Nemec & Hoff, Ltd., Burr Ridge.

For Appellee: Steven C. Fuoco, of counsel, Fuoco Law Group, Highland Park.

JUSTICE LIU delivered the judgment of the court, with opinion. Presiding Justice Simon and Justice Neville concurred in the judgment and opinion.


Page 523


[¶1] Plaintiff, Work Zone Safety, Inc. (Work Zone), appeals an order of the circuit court granting defendant, Crest Hill Land Development (CHLD), equitable relief on a judgment confirming an arbitration award. The arbitration involved a dispute that arose out of CHLD's sale of certain wetlands property to Work Zone. The arbitrator concluded that CHLD was obligated to repurchase the property at a specific price and awarded Work Zone damages in the amount of said price--noting that the award " stands" if CHLD failed to repurchase the property. The circuit court confirmed the award and entered a judgment against CHLD. Subsequently, CHLD did not repurchase the property or appeal the judgment. Instead, CHLD moved to dismiss the supplementary proceedings and asked for a " return of excess payment," arguing that it was inequitable for Work Zone to both retain the property and collect money damages. Work Zone challenged the motion as " an improper collateral attack" on the judgment. Following a hearing, the court ordered Work Zone to transfer the property to CHLD. This appeal followed.


[¶3] Work Zone and CHLD entered into a " Wetlands Escrow Agreement" (agreement) in connection with CHLD's sale of a 10.75-acre tract of vacant land to Work Zone. Pursuant to the agreement, CHLD was required to complete certain mitigation work on 3.7 acres of wetlands on the tract within a year of the closing. The agreement provided that if CHLD failed to perform the work, Work Zone had a right to elect that CHLD repurchase the wetlands property (property) for the price of $224,029.08. The agreement also provided that certain monies designated as the " Wetlands Escrow Funds" would be used for the mitigation work. After CHLD failed to perform the work, Work Zone demanded that CHLD repurchase the property. CHLD refused to buy back the property, and Work Zone initiated arbitration proceedings.

[¶4] In August 2010, the arbitrator ruled that Work Zone had properly exercised its contractual right to demand CHLD's repurchase of the property and that CHLD had failed to satisfy its repurchase obligation under the agreement. Work Zone

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was awarded $224,029.08 in damages, along with $25,000 in legal fees and $9,350 in administrative fees and expenses. The arbitration award provided, specifically: " If [CHLD] fails or refuses to accomplish its role as purchaser of the Returned Property, the Award of $224,029.08 in favor of [Work Zone] stands."

[¶5] In September 2010, after CHLD failed to repurchase the property, Work Zone filed a complaint in the circuit court to confirm the arbitration award. CHLD filed an answer and a counterclaim to vacate the award. On March 11, 2011, the court confirmed the arbitration award and entered judgment for Work Zone in the amount of $249,029.08, based on $224,029.08 in damages and $25,000 in legal fees. The court later entered, on April 14, 2011, a corrected order for a judgment amount of $258,379.08, which included $9,350 in administrative fees and expenses related to the arbitration. In an effort to collect the judgment amount, Work Zone issued citations to discover assets to CHLD and other third parties. Despite CHLD's failure to respond to the citations, Work Zone recovered approximately $105,000 of the judgment amount through supplementary proceedings.

[¶6] In May 2011, in response to an emergency motion filed by CHLD,[1] the circuit court granted CHLD another opportunity to repurchase the property. The court ordered CHLD to " close on the sale of the property" in accordance with the agreement and the arbitration award " on or before June 6, 2011 for a price of $268,379 minus offsets for any amounts collected by Work Zone in supplemental proceedings." [2] The court further stated: " In the event that the transaction does not occur on 6-6-11, for reasons within the control of [CHLD], the 3-11-11 & 4-14-11 orders shall stand." CHLD failed to purchase the property by the June 6 deadline, and Work Zone continued to seek enforcement of the judgment.

[¶7] Twenty-two months later, on March 5, 2013, CHLD filed a motion to dismiss the citations to discover assets and requested an " Order of Satisfaction with Release of Lien and Return of Excess Payment" (motion to dismiss).[3] CHLD argued that Work Zone's retention of the wetlands property and recovery of money damages constituted a windfall and, therefore, was inequitable. Relying on theories of unjust enrichment or, alternatively, equitable set off, CHLD asked the circuit court to order the disgorgement of the alleged excess recovery that Work Zone had obtained in supplementary proceedings. Three days later, on March 8, CHLD filed a motion for preliminary injunction, seeking to enjoin Work Zone from taking any further action to collect the judgment until the circuit court ruled on CHLD's motion to dismiss. For the first time, in its motion for ...

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