Stephen L. Winternitz, Inc. v. National Bank of Monmouth

                                                           FIRST DIVISION
                                                            June 30, 1997





No. 1-96-0410

STEPHEN L. WINTERNITZ, INC.,            )    Appeal from the
                                        )    Circuit Court 
          Plaintiff-Appellant,          )    of Cook County. 
                                        )
     v.                                 )    
                                        )
NATIONAL BANK OF MONMOUTH               )    Honorable  
                                        )    DAVID LICHTENSTEIN,
          Defendant-Appellee.           )    Judge Presiding.


     JUSTICE GALLAGHER delivered the opinion of the court:
     Plaintiff Stephen L. Winternitz, Incorporated (Winternitz)
filed a complaint seeking damages from defendant National Bank of
Monmouth (Bank) for breach of a brokerage contract.  The first
amended complaint (complaint) alleges that defendant agreed to
pay a commission to plaintiff in the event that defendant sold
certain manufacturing equipment to a purchaser produced by
plaintiff.  Defendant moved to dismiss the Complaint pursuant to
section 2-619.1 of the Illinois Code of Civil Procedure (735 ILCS
5/2-619.1 (West 1994)), and the trial court granted defendant's
motion.  Plaintiff appealed, and we now reverse and remand.
     The facts of the case, as alleged in the complaint, are
relatively straightforward.  American Pro Latex defaulted on a
loan obtained from defendant Bank.  To recoup some of its losses,
the Bank sought to liquidate the loan collateral--manufacturing
equipment that produced latex gloves.  The Bank originally hired
Winternitz to appraise the equipment for public auction;
subsequently, the Bank and Winternitz orally agreed to an
arrangement whereby the Bank would pay to Winternitz an 8%
commission if Winternitz could produce a single buyer for all of
the equipment.  On December 29, 1993, the parties confirmed their
agreement in writing when Winternitz located a buyer, Safeskin
Corporation (Safeskin).  The written contract, drafted by the
Bank and faxed to Winternitz, provided in its entirety:
     "The National Bank will pay you a commission of 8% of
     the purchase price if it sells the equipment of
     American Pro Latex to Safeskin Corporation or another
     buyer whom you produce."
     
          On January 14, 1994, Safeskin submitted a bid to purchase
the American Pro Latex equipment for $783,000 and promised the
Bank $50,000 as a deposit by January 17, 1994.  The Bank accepted
Safeskin's offer in a letter dated January 17, 1994.  However,
Safeskin failed to pay the balance of the purchase price.  This
failure ultimately forced the Bank to sell the equipment at
public auction for substantially less than the contract price. 
The Bank then filed suit against Safeskin on the contract,
seeking damages equal to the difference between the sale price
and the contract price, plus expenses.  That case is now pending
in federal court.
     Meanwhile, Winternitz filed a three-count complaint against
the Bank.  In addition to costs and attorneys fees, each count
sought differing amounts of damages.  Count I alleged breach of
the brokerage contract and sought $62,640, the full value of
plaintiff's 8% commission.  Alternatively, count II sought 8% of
the earnest money deposit retained by the Bank ($4,000) under a
theory of quantum meruit.  Count III sought 8% of any moneys that
the Bank recovers in its lawsuit against Safeskin, also under a
theory of quantum meruit.  As noted above, the trial court
dismissed plaintiff's complaint pursuant to section 2-619.1 of
the Code of Civil Procedure.  On appeal, plaintiff requests that
this court reverse and remand with directions to order the
defendant to answer the complaint.
     Section 2-619.1 of the Code of Civil Procedure allows for a
party to combine in one motion a section 2-615 motion to dismiss
for substantially insufficient pleadings with a section 2-619
motion for involuntary dismissal based upon defects or defenses. 
735 ILCS 5/2-619.1 (West 1994).  When ruling on a motion to
dismiss under either section 2-615 or section 2-619 of the Code,
the trial court must interpret all pleadings and supporting
documents in the light most favorable to the nonmoving party; the
court should grant the motion only if plaintiff can prove no set
of facts that would support a cause of action.  Toombs v. City of
Champaign, 245 Ill. App. 3d 580, 615 N.E.2d 50 (1993).  Because
this process does not require the appellate court to weigh facts
or determine credibility, the court applies a de novo standard of
review.  Toombs, 245 Ill. App. 3d at 583, 615 N.E.2d  at 51;
Weatherman v. Gary-Wheaton Bank, 286 Ill. App. 3d 48, 63, 676 N.E.2d 206, 216 (1996).  
     Plaintiff argues that it fulfilled its obligation under the
brokerage contract and earned its commission by producing a
ready, willing and able buyer in Safeskin.  In support of this
proposition, plaintiff cites Fox v. Ryan, 240 Ill. 391, 88 N.E. 974 (1909), as well as other more recent decisions, including
Hallmark & Johnson Properties, Ltd. v. Taylor, 201 Ill. App. 3d
512, 559 N.E.2d 141 (1990), and Bychowski v. ERA Tempo Realty,
Inc., 274 Ill. App. 3d 1093, 655 N.E.2d 292 (1995).  We agree
with plaintiff and find that our decision in United Investors,
Inc. v. Tsotsos, 132 Ill. App. 3d 175, 477 N.E.2d 40 (1985),
controls the outcome of this appeal.  
     This court adopted an argument nearly identical to the one
plaintiff offers here in United Investors, a case not cited in
the briefs of either party.  In that case, the plaintiff brought
suit to recover a brokerage commission allegedly due under a real
estate listing agreement, although the record indicated that the
defendant appointed the plaintiff to locate a purchaser for
defendant's business.  132 Ill. App. 3d at 176-77, 477 N.E.2d  at
41.  The defendant eventually entered into a contract with a
prospective purchaser supplied by the plaintiff, although they
never consummated their transaction.  The trial court granted
summary judgment in favor of the plaintiff.  132 Ill. App. 3d at
177, 477 N.E.2d  at 41.  On appeal, we stated that "a sale need
not be consummated for a real estate broker to recover his
commission."  132 Ill. App. 3d at 178, 477 N.E.2d  at 42.  We went
on to hold: "Where a seller of real estate enters into an
enforceable contract of sale with a purchaser procured by a
broker, the readiness, willingness and ability of the purchaser
is no longer open to question and the broker's right to
compensation accrues whether or not the sale is completed." 
United Investors, Inc. v. Tsotsos, 132 Ill. App. 3d at 178, 477 N.E.2d  at 42.  Despite this holding, we reversed and remanded the
case for a determination of whether the plaintiff had forfeited
its commission by violating the brokerage agreement.  132 Ill.
App. 3d at 180, 477 N.E.2d  at 43.
     As support for the holding in United Investors, we cited to
our supreme court's opinion in Fox v. Ryan, 240 Ill. 391, 88 N.E. 974 (1909).  In that case, the defendant, who owned stock in a
mining company, employed the plaintiff broker to negotiate the
sale of the company's stock to another mining company.  240 Ill. 
at 392-93, 88 N.E.  at 975.  When the broker's negotiations with
the prospective purchasers bogged down, the defendant completed
the negotiations himself, although he still promised to pay the
broker $4,000 in the event a deal was made.  Ultimately, the
defendant and purchasers struck a deal, whereby the purchasers
contracted to make an initial downpayment and pay the balance in
installments.  240 Ill.  at 393-94, 88 N.E.  at 975.  The
purchasers defaulted on the deferred payments, however, and the
sale never closed.  240 Ill.  at 395, 88 N.E.  at 976.  The supreme
court, holding that the broker was entitled to his commission,
stated:
     "'The true rule is, that the broker is entitled to his
     commissions if the purchaser presented by him and the
     vendor, his employer, enter into a valid, binding and
     enforceable contract.  If, after the making of such a
     contract, even though executory in form, the purchaser
     declines to complete the sale and the seller refuses to
     compel performance, the broker ought not to be deprived
     of his commissions.'"  240 Ill.  at 396, 88 N.E.  at 976,
     quoting Wilson v. Mason, 158 Ill. 304, 311, 42 N.E. 134, 136 (1895).
     
     The court affirmed the trial court's judgment in favor of the
plaintiff broker.  240 Ill.  at 398, 88 N.E.  at 977.    
     We feel that United Investors accurately states the rule
under Illinois law, as expressed in Fox v. Ryan.  Although each
of those cases dealt with the sale of a business, we find that
the reasoning found therein readily extends to the facts of this
case, which deals with the sale of certain assets of a business. 
The complaint alleges (1) that a brokerage contract existed
between plaintiff and defendant; (2) that, pursuant to the terms
of that contract, plaintiff procured Safeskin, a prospective
purchaser for defendant's equipment; and (3) that defendant
entered into a contract with Safeskin.  Defendant correctly
points out that the complaint fails to allege that defendant
entered into a "valid, binding, and enforceable contract" with
Safeskin.  However, the complaint does allege that defendant
filed suit against Safeskin seeking damages for breach of
contract.  Considering these pleadings in the light most
favorable to plaintiff, we find that the complaint adequately
states a cause of action and that the trial court erred in
granting defendant's motion to dismiss.
     Defendant argues that the actual sale of the manufacturing
equipment constituted a condition precedent to its obligation to
pay plaintiff.  Because Safeskin never consummated the
transaction, defendant asserts that no "sale" ever took place. 
Defendant also argues that the true focus is not whether
plaintiff produced a ready, willing and able buyer but, rather,
whether plaintiff was the procuring cause of a transaction
between the Bank and Safeskin, citing Modern Tackle Co. v.
Bradley Industries, Inc., 11 Ill. App. 3d 502, 297 N.E.2d 688
(1973).  Defendant reasons that plaintiff cannot be the procuring
cause of a transaction if no transaction took place.  We address
each of defendant's assertions in turn.
     First, assuming a contract existed between plaintiff and
defendant, we hold that plaintiff has adequately alleged that a
"sale" occurred.  Our supreme court has stated that "[i]f a
valid, enforceable contract was made, this constituted a sale and
was a compliance with the agreement between [seller] and
[broker]."  Fox v. Ryan, 240 Ill.  at 395, 88 N.E.  at 976.  
     Defendant argues that the plain and obvious meaning of the
contract's "if it sells" language required a consummated
transaction to entitle plaintiff to its commission.  The Bank,
however, cites no case authority supportive of its
interpretation, and we decline to accept it.  Yet even if we did
accept defendant's construction of the "if it sells" language, it
would merely inject ambiguity into the contract.  A contract is
ambiguous if the language is susceptible to more than one
meaning.  Krantz v. Chessick, 282 Ill. App. 3d 322, 329, 668 N.E.2d 77, 81 (1996).  This contract--a minimalist's delight--was
drafted solely by defendant Bank and should be construed strongly
against the Bank.  Duldulao v. Saint Mary of Nazareth Hospital
Center, 115 Ill. 2d 482, 493, 505 N.E.2d 314, 319 (1987). 
Accordingly, even were we to accept defendant's interpretation of
the brokerage contract as reasonable, we would still hold that
count I of the complaint sufficiently states a cause of action
for breach of the alleged brokerage contract.
     Furthermore, we believe that our holding is consistent with
Modern Tackle Co. v. Bradley Industries, Inc., 11 Ill. App. 3d
502, 297 N.E.2d 688 (1973), as well as the other cases
distinguishing between the rights and duties of a real estate
broker and that of a "finder" or "business opportunity broker." 
See Ruskin v. Rodgers, 79 Ill. App. 3d 941, 399 N.E.2d 623
(1979); Ehrman v. Cook Electric Co., 630 F.2d 529 (7th Cir.
1980); Hennessey v. Schmidt, 521 F.2d 1282 (7th Cir. 1975).  A
"finder" has been defined as an intermediary who finds,
introduces and brings together two parties to a business
opportunity.  Ruskin, 79 Ill. App. 3d at 960, 399 N.E.2d  at 637. 
While a broker also brings parties together, the broker plays a
role in the ultimate negotiations of sale; a finder leaves the
negotiations up to the principals themselves.  Ruskin, 79 Ill.
App. 3d at 961, 399 N.E.2d  at 637; Modern Tackle, 11 Ill. App. 3d
at 507, 297 N.E.2d  at 692; Business Development Services, Inc. v.
Field Container Corp., 96 Ill. App. 3d 834, 842, 422 N.E.2d 86,
93 (1981).  The Modern Tackle court also held that, in order for
a finder or business opportunity broker to collect a commission,
the finder must be the proximate or procuring cause of an
eventual transaction.  Modern Tackle, 11 Ill. App. 3d at 507, 297 N.E.2d  at 693.
     While it does appear, on this record, that plaintiff's role
approximated that of a finder or business opportunity broker, it
also appears that plaintiff was the proximate or procuring cause
of the ultimate transaction.  Here, the alleged contract between
plaintiff and defendant provided that plaintiff would receive an
8% commission if defendant sold the equipment to Safeskin.  As
discussed above, defendant allegedly entered into a contract with
Safeskin, a contract which constituted a "sale" under Fox v. Ryan
and United Investors.  Under the facts as alleged in this
complaint, plaintiff deserves the opportunity to prove its
allegations that a brokerage contract existed between plaintiff
and defendant and that defendant entered into a valid, binding
and enforceable contract with Safeskin--entitling plaintiff to
its commission under the alleged brokerage contract. 
     Indeed, this court rejects defendant's claims that no sale
ever occurred between it and Safeskin, particularly as defendant
seeks to enforce that contract of sale in federal court. 
Defendant's contradictory positions might very well raise
questions of judicial estoppel, although this is a question we
need not consider at this point.  See generally Bidani v. Lewis,
285 Ill. App. 3d 545, 675 N.E.2d 647 (1996) (doctrine of judicial
estoppel precludes one party from adopting contrary positions in
consecutive legal proceedings).
     We now consider counts II and III, plaintiff's quantum
meruit claims.  Plaintiff argues that it is entitled to plead
these counts in the alternative, in the event that it fails to
establish that an express brokerage contract existed between
plaintiff and defendant.  We agree.  "It is permissible to argue
in the alternative, even though such arguments are based upon
inconsistent facts."  Hillblom v. Ivancsits, 76 Ill. App. 3d 306,
311, 395 N.E.2d 119, 122 (1979).  On remand, plaintiff may
establish that the contract between defendant and Safeskin was a
valid, binding, and enforceable agreement.  If so, plaintiff will
have demonstrated that it rendered valuable services from which
defendant derived some financial benefit.  "[A] plaintiff may
recover under quantum meruit where he fails to establish the
express contract but does show that services were rendered.
(Emphasis added.)"  Business Development Services, Inc., 96 Ill.
App. 3d at 843, 422 N.E.2d  at 94.  In light of our analysis, we
reinstate counts II and III of the complaint.
     Defendant counters that because it has not challenged the
existence of an express brokerage contract, plaintiff cannot
recover under a theory of quantum meruit, citing Protestant
Hospital Builders Club v. Goedde, 98 Ill. App. 3d 1028, 1031, 424 N.E.2d 1302, 1305 (1981).  Protestant Hospital does not control
here, because in that case both parties stipulated at trial that
an express contract existed.  98 Ill. App. 3d at 1029-30, 424 N.E.2d 1304.  This appeal comes to us from the trial court's
dismissal of the complaint; on remand, defendant may yet dispute
the existence of an express brokerage contract.  
     Defendant further contends that, because it did not
consummate its transaction with Safeskin, no "sale" occurred and
it received no financial benefit from the services rendered by
plaintiff.  We rejected this argument above, and we reject it
again here.  
     In conclusion, we reverse the trial court's dismissal of the
first amended complaint and remand this case to the trial court
with directions that defendant must answer the complaint.  On
remand, if plaintiff proves that defendant entered into a valid,
binding and enforceable contract with Safeskin, then a "sale"
occurred.  If a "sale" occurred, then plaintiff should be
entitled either to its commission or the reasonable value of the
services it rendered to defendant, depending upon whether an
express brokerage contract existed between the parties.
     Reversed and remanded.
     CAMPBELL, P.J., and BUCKLEY, J., concur.