Falcon Associates, Inc. v. Cox
Annotate this Case
August 14, 1998
NO. 5-96-0847
IN THE
APPELLATE COURT OF ILLINOIS
FIFTH DISTRICT
_________________________________________________________________
FALCON ASSOCIATES, INC., ) Appeal from the
) Circuit Court of
Plaintiff and Counterdefendant- ) St. Clair County.
Appellee and Separate Appellant, )
)
v. ) No. 94-L-740
)
WENDELL COX and MARY JEAN LOVE, )
)
Defendants and Counterplaintiffs- )
Appellants and Separate Appellees,)
)
v. )
)
ROBERT G. WOLFE and FALCON LAND )
COMPANY, )
) Honorable
Counterdefendants-Appellees ) James M. Radcliffe,
and Separate Appellants. ) Judge, presiding.
_________________________________________________________________
JUSTICE GOLDENHERSH delivered the opinion of the court:
This appeal centers around a new home with a final purchase
price of $227,387.54 built by plaintiff-counterdefendant, Falcon
Associates, Inc., for defendants-counterplaintiffs, Wendell Cox and
Mary Jean Love. Cox and Love (buyers) appeal from the St. Clair
County Circuit Court's order rejecting their claim that Falcon
Associates, Inc., along with other counterdefendants, Robert G.
Wolfe and Falcon Land Company (collectively, sellers), violated the
Illinois Consumer Fraud and Deceptive Business Practices Act (the
Act) (815 ILCS 501/1 et seq. (West 1994)). Sellers appeal the
circuit court's judgment in the amount of $222,896.77, entered
after a jury returned a verdict for buyers in that amount. The
appeals were consolidated. On appeal, buyers contend that (1) the
home builder's promise to provide a house with a certain amount of
insulation (R-19) and the subsequent failure to deliver that amount
is fraudulent and entitles buyers to remedies under the Act, (2) a
home builder's failure to take reasonable steps to ensure
compliance with applicable codes is fraudulent and entitles a buyer
to the remedies of the Act, and (3) the delivery of a residential
building in substantial noncompliance with contractual promises is
fraudulent and entitles a buyer to the remedies of the Act. In
their appeal, sellers contend that (1) the trial court erred in
refusing to dismiss counts IV and V of buyers' counterclaim and in
entering judgment against Robert G. Wolfe and Falcon Land Company
because piercing the corporate veil of the contracting party,
Falcon Associates, Inc., was not justified and (2) the damages
awarded buyers on the breach of contract claim were excessive,
improper, speculative, and erroneous. We affirm in part as
modified, reverse in part, and remand with directions.
I. FACTS
On September 12, 1993, buyers signed a contract with Falcon
Associates, Inc., for the construction of a residence at 1010
Thornbury in Thornbury Hill subdivision, located in O'Fallon.
Robert G. Wolfe was president of Falcon Associates, Inc. Buyers'
decision to sign a contract with this home builder was due in large
part to the quality of construction shown in the builder's model
homes in the subdivision. Mary Jean Love testified that she and
her husband toured two model homes built by sellers and were
impressed with the quality of those homes. Wolfe admitted that the
model homes were intended as a reliable indicator of the general
construction quality of homes that would be built by sellers.
The contract called for a two-story, 2,753-square-foot home
with a basement, in which "all work [would] be performed in a
workmanlike fashion consistent with applicable building codes."
The contract called for the home to be completed on January 14,
1994; however, the closing did not occur until March 29, 1994.
Even at that late date, the home was not finished, and buyers were
given a list of incomplete items, which sellers promised to
complete in the near future. Buyers moved in after the closing
date and immediately began to experience problems with the house.
One of the first things noticed by buyers was that the wind
blew through the home, even with all windows and doors shut. This
caused a draft strong enough to blow papers and napkins off tables
and onto the floor. Buyers also experienced numerous water
problems. For example, windows and doors leaked when it rained;
water from an upper floor bathroom pooled in a kitchen light
fixture; the upper floor master bedroom ceiling leaked, causing the
mattress and furniture in that bedroom to be soaked; and water
flowed into the basement from outside during rains. Pictures
exhibiting the extent of these problems were introduced by buyers.
The builder was made aware of problems as they arose. Between
March 30, 1994, and July 19, 1994, Doren Rakers (sellers'
superintendent) and other employees of sellers and subcontractors
made at least 31 visits to the home in question, attempting to
repair the house. Sellers' own records indicate numerous leaks and
other problems found at the house, and the records indicate
attempts to correct the situation. For example, sellers' records
indicate leaks in the basement, the utility room, the library, the
living room, and the garage and at various windows throughout the
house, including a front bay window.
Mary Jean Love testified that it was not her or her husband's
contention that sellers did not try to fix things, but rather, they
were complaining of sellers' lack of accomplishment. As soon as
one thing was fixed, it would rain again and the problem would be
back or a new problem would be discovered. The litigation began
after buyers placed signs in the windows of their home which read,
inter alia, "Please fix this home," "Please fix our lawn," and
"Water damag[e]." Wolfe testified that he could not understand why
these signs had been posted because he was attempting to fix the
problems and had directed his employees to get the house fixed so
buyers would be happy. Wolfe did not want his reputation damaged.
On August 4, 1994, Falcon Associates, Inc., filed suit against
buyers for damage to sellers' business caused by the posting of the
signs. Wolfe testified the signs caused a significant decrease in
his business in 1994 and 1995. A local real estate agent, Judy
Dempcy, also testified that the signs adversely affected sales in
the Thornbury Hill subdivision. Buyers denied any liability and
filed a counterclaim. Count I was for breach of contract. Count
II was a negligence claim. Count III was a claim under the Act.
Falcon Associates, Inc.'s original claim was dismissed.
Thereafter, an amended complaint was filed.
On February 20, 1996, buyers filed a motion to amend their
counterclaim to add counts against the shareholders of Falcon
Associates, Inc., and against Falcon Land Company on the ground
that Falcon Associates, Inc., was a "sham" corporation and had
transferred all its assets to Falcon Land Company. This amendment
was allowed, and a first amended counterclaim was filed adding a
count against Robert G. Wolfe individually and Falcon Land Company.
At trial, each side called an expert to testify about the
problems and defects in the home and how to correct them. Buyers
called Leroy Dawson, a licensed architect and experienced general
contractor, who first inspected the home after Falcon Associates,
Inc., filed the original action. Dawson discovered numerous
problems and shoddy workmanship. His preliminary report concluded
"that a building with this magnitude of visible defects will have
many latent defects." Because of Dawson's preliminary report,
buyers proceeded with their own suit against sellers. Ultimately,
Dawson discovered, inter alia, incorrectly installed, undersized,
and improperly sealed plumbing; the lack of a vapor barrier between
the concrete basement floor and the ground, as per the guidelines
of the Building Official Code Administration (BOCA) code; no
reinforced flooring under the main support wall, as per the BOCA
code; an uneven basement floor; inadequately designed floor joists;
and an I-beam which measured only four inches rather than 8 to 12
inches, as required by the BOCA code. Dawson also found inadequate
flashing of valleys and chimneys, as per the BOCA code; improperly
installed roofing shingles, in violation of both the BOCA code and
manufacturer's instructions; improper grading, as per the BOCA
code, allowing water to seep into the house; improperly supported
brick veneer walls; improperly installed air-conditioning units,
which were actually leaning at the time of inspection; poor
workmanship by brick masons, including not priming and not taking
the time to shorten the lentils, resulting in a cracking, uneven
foundation; improperly installed siding, which blew off in the
wind; improperly installed windows; improperly fabricated and
installed chimney caps; incorrectly connected porches; bathroom
exhaust vents blocked by insulation; too small a window in an upper
floor guest bedroom, which did not permit egress in case of
emergency and, therefore, per the BOCA code, could not be
considered a bedroom; furnace vents in the attic in direct contact
with wood, in violation of both manufacturer's specifications and
the BOCA code; improperly ventilated and nonventilated attic areas;
no wall ties holding brick veneer to the exterior of the wall, as
per the BOCA code; no building felt between exterior sheathing and
brick veneer, in violation of the BOCA code; no fire protection
between the garage and the living space, in violation of the BOCA
code; improperly installed marble flooring in the foyer; and an
improperly installed main gas pipe. Additionally, Dawson testified
that the specifications for the house called for R-19 wall
insulation, but the manner of construction allowed space for only
R-13 insulation, which is of lesser quality. Dawson found only R-
13 insulation during his inspection. Dawson recommended, inter
alia, that the home be reroofed, that the brick veneer be torn off
and reinstalled, that the concrete floors be broken up and repoured
to create a proper foundation for the support of the wall, and that
a steel I-beam be installed to carry the load of the home.
John Page, a structural engineer, testified as an expert for
sellers. Page inspected the home after reading Dawson's report and
focused on the items in that report. Page disagreed with Dawson as
to several items and testified that the repairs necessary to the
home would be substantially less than those Dawson believed were
necessary. By the time Page inspected the home, the entire roof
had already been torn off and replaced as per Dawson's
recommendation. Sellers admitted that flashing was questionable at
windows and doors and would need to be replaced. They also
admitted that there were leaks that would have to be corrected and
that the center bearing wall in the basement needed to be replaced.
Sellers submitted testimony that repairs estimated to cost $7,720
were necessary. Buyers, on the other hand, presented testimony
that the repairs would cost substantially more.
Tony Pacewic of Pacewic Construction was hired by sellers to
perform all repairs, except plumbing. Pacewic testified that the
repairs would total $88,050. Stephen Jany, a licensed plumber,
testified on behalf of buyers about the numerous plumbing problems
in the house. According to Jany, there was a multitude of
violations of the BOCA code and, in general, overall bad
workmanship. For example, the gas piping was inadequately secured,
which was a safety hazard; a vent pipe was not hooked up and was
not capped off, allowing sewer gas into the house; the rough-in in
the basement for an additional bathroom was configured in such a
way that he had "no idea how they plan on putting fixtures in
there," and none of the vents were capped off in the rough-in area;
the water line in the basement was not large enough; and the
laundry room water lines froze when it was below freezing outside.
Jany also testified concerning additional repairs. Jany estimated
that the repairs would cost $5,628.84.
Mary Jean Love testified that she and her husband would have
to move out of the house while such repairs were being done for a
period of at least six months. She testified about other
miscellaneous items that would have to be done and about the
additional costs of heating the home due to the lower-grade
insulation that was used. Love, a freelance technical writer, also
testified about her lost income. Love testified that her job
suffered because of all the time she spent at home allowing
repairmen into the house and making sure the repairs were correctly
completed. Love's testimony reflected her anxiety and despair over
the situation. Love testified that in the first year after the
home was constructed, she was unable to attend five job-related
conferences. Love missed a conference in San Antonio because of
repairs on her house and was unable to receive a refund for an
airline ticket previously purchased in the amount of $352. Love
testified that conferences are the only marketing tool that she has
and that it is at these conferences that she is able to acquire new
business. Love testified that it will take her two to three years
to reestablish herself in the field as a technical writer. She
estimated that her lost income was approximately $60,000.
After both sides rested, the sellers moved for a directed
verdict on counts IV and V, alleging that there was insufficient
evidence to permit the piercing of the corporate veil to allow
judgment against either Wolfe or Falcon Land Company. The trial
court denied this motion, and the case was submitted to the jury on
Falcon Associates, Inc.'s claim of intentional interference with
prospective business advantage and buyers' counterclaim for breach
of contract. The jury was instructed, over sellers' objection, to
consider all three counterdefendants as one defendant. In closing,
buyers' attorney summarized buyers' damages as follows:
"Homeowners' expenses (testified to by Ms. Love)..41,403.05
Roof replacement and repairs......................8,295.22
Pacewic repair estimate..........................88,050.00
Jany plumbing.....................................5,628.00
Tarp................................................400.00
Pacewic work for Dawson.............................362.50
Dawson estimated fee..............................9,200.00
Dawson site management fee........................6,000.00
Love's lost wages................................63,206.00
Love's ticket to San Antonio........................352.00"
The trial court submitted two special interrogatories to the
jury, which read as follows:
"SPECIAL INTERROGATORY NO. 1
Did Falcon Associates, Inc.[,] know or should they have
known that the House, as delivered to Jean Love and Wendell
Cox, was constructed in substantial part[] in violation of the
applicable building codes?
SPECIAL INTERROGATORY NO. 2
Did Falcon Associates, Inc.[,] intentionally conceal[] or
misrepresent or omit to tell Jean Love and Wendell Cox that
the house was constructed in substantial part[] in violation
of the applicable building codes?"
The jury answered "Yes" to the first interrogatory and "No" to the
second. The jury also returned the following verdict:
"We, the jury, find for Wendell Cox and Jean Love and
against Falcon Associates, Inc. We assess the damages in the
sum of $222,896.77, itemized as follows:
For reasonable expenses of necessary repairs to the
property which was damaged. $130,897.75
For the value of loss of use of the building for the time
reasonably required for the repair. $ 9,000.00
Other: $ 82,999.02."
The claim brought by buyers pursuant to the Act was decided by the
trial court. The trial court entered judgment in favor of sellers
and against buyers under the Act, noting the jury's responses to
the special interrogatories, specifically, the jury's negative
response to special interrogatory No. 2. Both sides appeal.
II. ANALYSIS
A. THE ILLINOIS CONSUMER FRAUD ACT
We first address buyers' contention that the trial court erred
in entering judgment in favor of sellers on buyers' claim under the
Act. Buyers specifically contend that they are entitled to
remedies under the Act because (1) the sellers promised to provide
a house with a certain amount of insulation (R-19) and the
subsequent failure to deliver that amount is fraudulent, (2) the
sellers' failure to take any reasonable steps to ensure compliance
with applicable codes is fraudulent, and (3) the delivery of a
residential building in substantial noncompliance with contractual
promises is fraudulent. Sellers reply that the trial court was
correct in its interpretation that this is but a breach of contract
case and that the Act does not apply in this situation. Sellers
contend that buyers failed to prove any deceptive act or practice
and, at most, have only shown a breach of contract. After careful
consideration, we believe that the trial court's determination that
the Act does not apply should be reversed and the cause should be
remanded for further consideration.
The general trend in Illinois has been to allow consumers
greater protection by equalizing the contractual relationship
between consumers and manufacturers. Nowhere has this been more
evident than in the sale of new homes from a builder-vendor to a
consumer-purchaser. For example, in Petersen v. Hubschman
Construction Co., 76 Ill. 2d 31, 389 N.E.2d 1154 (1979), our
supreme court rejected the harshness and injustice of the rule of
caveat emptor and held that in the sale of a new home by a builder-
vendor, there is an implied warranty of habitability which will
support a purchaser's action against a builder for latent defects.
In so doing, our supreme court eloquently explained the lopsided
relationship between the builder-vendor and the consumer-purchaser:
"Many new houses are, in a sense, now mass produced. The
vendee buys in many instances from a model home or from
predrawn plans. The nature of the construction methods is
such that a vendee has little or no opportunity to inspect.
The vendee is making a major investment, in many instances the
largest single investment of his life. He is usually not
knowledgeable in construction practices and, to a substantial
degree, must rely upon the integrity and the skill of the
builder-vendor, who is in the business of building and selling
houses. The vendee has a right to expect to receive that for
which he has bargained and that which the builder-vendor has
agreed to construct and convey to him, that is, a house
reasonably fit for use as a residence." Petersen, 76 Ill. 2d
at 40, 389 N.E.2d at 1158.
In the instant case, there is no question but that the buyers
did not receive the house they were expecting. Buyers agreed to
pay $227,387.54 for a house, but not a house that leaked, required
the windows to be replaced within the first year, needed an entire
new roof, had wind blowing through it even with all windows and
doors shut, and had numerous structural defects, some of which were
actually hazardous to the buyers' safety. So many repairs were
required that an argument can be made that buyers would have been
better off purchasing a 100-year-old home and rehabbing it. The
buyers filed a breach of contract case but sought additional
consumer protection through the Act in order to make them whole.
As the sellers have pointed out, when a party is required to retain
an attorney to enforce its contractual rights, that party does not
receive full compensation, even when it receives the contract
price, because that party is required to pay its attorney and the
costs of litigation.
Section 2 of the Act provides in part:
"Unfair methods of competition and unfair deceptive acts
or practices, including but not limited to the use or
employment of any deception, fraud, false pretense, false
promise, misrepresentation or the concealment, suppression or
omission of any material fact, with intent that others rely
upon the concealment, suppression, or omission of such
material fact *** in the conduct of any trade or commerce are
hereby declared unlawful whether any person has in fact been
misled, deceived or damaged thereby." 815 ILCS 505/2 (West
1994).
Section 10a(c) of the Act specifically allows the recovery of
attorney fees under the Act. 815 ILCS 505/10a(c) (West 1994). The
Act provides broader consumer protection than an action for common
law fraud. Connor v. Merrill Lynch Realty, Inc., 220 Ill. App. 3d
522, 581 N.E.2d 196 (1991). Our General Assembly has given a
"`clear mandate *** that the courts *** are to utilize [the Act] to
the utmost degree in eradicating all forms of deceptive and unfair
business practices and to grant appropriate remedies to defrauded
consumers.'" Warren v. LeMay, 142 Ill. App. 3d 550, 563, 491 N.E.2d 464, 472 (1986), quoting American Buyers Club of Mt. Vernon,
Ill., Inc. v. Honecker, 46 Ill. App. 3d 252, 257, 361 N.E.2d 1370,
1374 (1977). The terms of the Act are incapable of precise
definition; accordingly, whether a given set of circumstances is
unfair or deceptive must be determined on a case-by-case basis.
People ex rel. Fahner v. Walsh, 122 Ill. App. 3d 481, 484, 461 N.E.2d 78, 81 (1984). The Act is to be broadly applied and
liberally construed. Walsh, 122 Ill. App. 3d at 486, 461 N.E.2d at
82. The decision to award attorney fees under the Act rests with
the sound discretion of the trial court. Roche v. Fireside
Chrysler-Plymouth, Mazda, Inc., 235 Ill. App. 3d 70, 86, 600 N.E.2d 1218, 1228 (1992).
In the instant case, the trial court held that the Act was
inapplicable: "[T]his is essentially a breach of contract case.
This court concludes that the jury's verdict, coupled with its
answers to the Special Interrogatories[,] supports that conclusion.
Further, the jury's answer to Special Interrogatory [N]o. [2]
mitigates against a finding of a violation of the Act." The trial
court relied on Bankier v. First Federal Savings & Loan Ass'n, 225
Ill. App. 3d 864, 588 N.E.2d 391 (1992), and Exchange National Bank
v. Farm Bureau Life Insurance Co., 108 Ill. App. 3d 212, 438 N.E.2d 1247 (1982). However, those cases are distinguishable: neither
case involved the sale of a home from a builder-vendor to a buyer
for use as a primary residence. We also find the trial court's
order possibly in error because it appeared to rely, at least in
part, on the jury's answer to special interrogatory No. 2. That
interrogatory asked the jury to determine whether the sellers
"intentionally" concealed or misrepresented or omitted to tell the
buyers that the house was constructed in substantial part in
violation of applicable building codes. It is well settled that
the Act does not authorize jury trials. Rubin v. Marshall Field &
Co., 232 Ill. App. 3d 522, 531, 597 N.E.2d 688, 693 (1992);
Richard/Allen/Winter, Ltd. v. Waldorf, 156 Ill. App. 3d 717, 725,
509 N.E.2d 1078, 1081 (1987). While the trial court said that it
had made its own assessment of all the evidence, it further stated
that it "consider[ed] and accept[ed] the jury's answers to the
Special Interrogatories." We are concerned that the trial court
improperly delegated part of its fact-finding function to the jury
and compromised its own independent determination. We also find
that special interrogatory No. 2 did not correctly state the law.
In order to establish a deceptive-practice claim, a plaintiff
must allege and prove (1) the misrepresentation or concealment of
a material fact, (2) an intent that the buyer rely on the
misrepresentation or concealment, and (3) that the deception
occurred in the course of conduct involving trade or commerce. 815
ILCS 5/2d (West 1994); Siegel v. Levy Organization Development Co.,
153 Ill. 2d 534, 542, 607 N.E.2d 194, 198 (1992). Regarding the
element of intent, innocent misrepresentations may be actionable.
Warren, 142 Ill. App. 3d at 566, 491 N.E.2d at 474. The key
consideration is the effect of the seller's conduct, not his
intent. Grimes v. Adlesperger, 67 Ill. App. 3d 582, 585, 384 N.E.2d 537, 539 (1978). The court in Honecker held:
"[T]he intention of the seller--his good or bad faith--is not
important. Rather, we focus our attention upon the effect
that that conduct might have on the consumer who was
unjustifiably misled into purchasing that which he did not
intend to purchase." Honecker, 46 Ill. App. 3d at 259, 361 N.E.2d at 1374-75.
The buyer need not show that the seller intended to deceive but
must show only that the seller intended the buyer to rely on the
act or information; even an innocent or negligent misrepresentation
may be actionable under the Act. Griffin v. Universal Casualty
Co., 274 Ill. App. 3d 1056, 1065, 654 N.E.2d 694, 700 (1995); Carl
Sandburg Village Condominium Ass'n No. 1 v. First Condominium
Development Co., 197 Ill. App. 3d 948, 557 N.E.2d 246 (1990).
Here, the builder-vendor may not have intended to deceive the
buyers, but he certainly intended for home buyers to rely on his
model homes as an indicator of the quality of homes he built and on
his promise of R-19 insulation throughout most of the home. Thus,
the second interrogatory was misleading and should not have been
relied on by the trial court. The trial court's finding that the
Act does not apply must be reversed, and the cause is remanded with
directions for the court to make its own independent evaluation of
whether the Act applies and whether attorney fees are appropriate.
B. PIERCING THE CORPORATE VEIL
In their appeal, sellers contend that the trial court erred in
refusing to dismiss counts IV and V of buyers' counterclaim and in
entering judgment against Wolfe and Falcon Land Company because the
piercing of the corporate veil of Falcon Associates, Inc., the
contracting party, was not justified. Wolfe and Falcon Land
Company specifically argue that their motion for directed verdict
on counts IV and V should have been granted and that buyers'
instruction No. 10 should not have been given. Buyers respond that
justice required that Wolfe and Falcon Land Company be liable for
the actions of Falcon Associates, Inc., because the transaction
between Falcon Land Company and Falcon Associates, Inc., created a
de facto merger or, in the alternative, Falcon Land Company was
nothing more than the alter ego of Falcon Associates, Inc., and
because Wolfe was the sole shareholder of the corporation.
Furthermore, buyers point out that within the statement of the
case, it was stated that all three counterdefendants were to be
treated as a single party and no one objected to the trial court's
statement of the case. We agree with buyers.
A court may find corporate officers personally liable for
corporate obligations through a remedy known as piercing the
corporate veil. Ted Harrison Oil Co. v. Dokka, 247 Ill. App. 3d
791, 617 N.E.2d 898 (1993). In order to pierce the corporate veil,
there must be (1) such unity of interest and ownership that the
separate personalities of the corporation and the individual no
longer exist and (2) such circumstances that adherence to the
fiction of a separate corporate existence would sanction a fraud,
promote injustice, or promote inequitable consequences. Dokka, 247
Ill. App. 3d at 795, 617 N.E.2d at 901, citing People ex rel. Scott
v. Pintozzi, 50 Ill. 2d 115, 128-29, 277 N.E.2d 844, 851-52 (1971).
A corporate entity will be disregarded if it would otherwise
present an obstacle to the protection of private rights or if the
corporation is an alter ego or business conduit of the governing or
dominant personality. Import Sales, Inc. v. Continental Bearings
Corp., 217 Ill. App. 3d 893, 904, 577 N.E.2d 1205, 1212 (1991). In
determining whether to disregard a corporate entity, a court should
consider a number of variables, with no single factor being
determinative. Such variables include: (1) inadequate
capitalization, (2) the failure to issue stock, (3) the failure to
observe corporate formalities, (4) the payment of dividends, (5)
the insolvency of the debtor corporation at the time, (6) the
nonfunctioning of other corporate officers or directors, (7) the
absence of corporate records, and (8) whether the corporation is a
mere facade for the operation of dominant stockholders. Dokka, 247
Ill. App. 3d at 795, 617 N.E.2d at 902. A reviewing court will
only reverse a finding of the trial court on the issue of piercing
the corporate veil if it is against the manifest weight of the
evidence. Dokka, 247 Ill. App. 3d at 796, 617 N.E.2d at 902.
Here, we cannot say that the trial court's determination to
pierce the corporate veil and to refuse to dismiss counts IV and V
is against the manifest weight of the evidence. At one time,
Falcon Associates, Inc., consisted of at least four partners, but
at the time in question, the corporation consisted only of Robert
G. Wolfe. It appears that no stock was issued, nor were any
dividends paid. Moreover, it appears that there was a de facto
merger of Falcon Associates, Inc., and Falcon Land Company. Falcon
Associates, Inc., transferred all of its assets to Falcon Land
Company in 1994 and 1995 after the sale of the home at 1010
Thornbury to buyers and after the buyers started their campaign
against sellers to fix their home. Sellers failed to object to the
statement of the case, which stated that all three parties should
be treated as a single party. Neither Falcon Land Company nor
Wolfe objected to this statement, which was read to the jury.
Therefore, all three counterdefendants acquiesced in the determina-
tion that they were but one single entity.
C. DAMAGES ON THE BREACH OF CONTRACT CLAIM
Sellers next allege that the damages awarded on the buyers'
breach of contract claim were excessive, improper, speculative, and
erroneous. Sellers specifically object to the jury's award of
$82,999.02 for "other" damages as unspecified, unproved, and
improper. The sellers argue that the bulk of this unspecified lump
sum of "other" damages is comprised of Mary Jean Love's request for
$63,206 in lost wages, consequential damages that are limited by
the contract. We agree.
The following verdict form was submitted to the jury:
"We assess the damages in the sum of $______________
itemized as follows:
For reasonable expenses of necessary repairs to the
property which was damaged. $______________
For the value of loss of use of the building for the time
reasonably required for the repair. $______________
For the difference between the fair market value of the
real property immediately before the occurrence and its fair
market value after the repairs. $_______________"
During deliberations, the jury sent out the following note:
"We have reached a verdict; however, the verdict form is
ambiguous because it asks for a total itemization of damages,
then a breakdown for reasonable expenses of necessary repairs
and value for loss of use of the building; however, there are
several items of damage which do not fall within either
category. Help!"
A discussion between the trial judge and attorneys for the parties
then ensued. After advising counsel they would not be waiving
future objections, the following response was sent to the jury
without an objection by either party:
"The court will allow you to further itemize the damages
determined on the appropriate verdict form. You may write in
this further itemization."
The jury then sent back the verdict form previously set forth in
the factual statement of this opinion.
A review of the record shows that the sellers failed to argue
that the buyers' remedies were limited by the contract. Likewise,
the sellers failed to object to the introduction of lost-wage
evidence presented by the buyers either during the testimony of
Mary Jean Love or during closing arguments.
The sellers did, however, sufficiently raise the contractual
defense in their posttrial motion. See Haight v. Aldridge Electric
Co., 215 Ill. App. 3d 353, 575 N.E.2d 243 (1991). The contractual
provision in question states, "Builder shall not be liable for any
incidental or consequential damage that may arise as a result of
this contract, the construction of the building, its ownership,
[its] occupancy[,] or any matter related to this agreement." This
language is sufficient to bar the recovery of the damages herein
labeled "Other", and the damages award is modified accordingly.
See First National Bank & Trust Co. v. First National Bank, 178
Ill. App. 3d 180, 533 N.E.2d 8 (1988).
For the foregoing reasons, the judgment of the circuit court
of St. Clair County is affirmed in part as modified, and reversed
in part, and the cause is remanded with directions.
Affirmed in part as modified and reversed in part; cause
remanded with directions.
RARICK[fn1] and MAAG, JJ., concur.
[fn1]Justice Kuehn participated in oral argument; Justice
Rarick was later substituted on the panel.
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