Articles Posted in Real Estate Litigation

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In 1981, two doctors entered into a partnership agreement to buy an office building in which they would house their separate medical practices. Each partner contributed an equal sum of money to buy the building and agreed to share equally the cost of maintaining and operating it. In spite of this agreement, one doctor, Dr. V.S. Vedam, often paid more than his half of the expenses.

The other doctor, Dr. C.U. Reddi, and Dr. Vedam ran their separate medical practices in the building until 1991. At that place and time, Dr. Reddi moved his practice to another location and stopped paying any costs related to the building.  Communications between the doctors ended and the state of silence existed between them until around 2003 when the building was sold and the proceeds placed in escrow.

In 2004, Dr. Vedam sued to recover his share of the proceeds of the sale of the real estate, plus the expenses he had paid in excess of his shares. Reddi disputed some of Vedam’s claims and filed a counterclaim to recover rent for the years that Vedam occupied the building by himself.

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On Oct. 28, 2013, Robert Skahill signed a contract with Metropolitan Properties & Development Inc. The contract called for him to buy the property from Metropolitan for $3.1 million.

Skahill was required to put down $50,000 as earnest money of which $5,000 was due on the signing of the contract and the remaining $45,000 to be paid following the Nov. 18 inspection.

He Skahill paid $5,000, but never paid the remaining $45,000 in earnest money.

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The Illinois Appellate Court has ruled in a dispute regarding who should inherit a home in Highland Park, Ill. Although a trust instrument stated the house was part of the trust, there was no separate, formal documentation showing that a transfer of the house had been placed in the trust. The court In re Estate of Mendelson considered whether the house was properly transferred into the trust. The court noted that it could “find no Illinois authority on point.”

The Illinois Appellate Court held that the house was a part of the trust because it was described in it although there was no recorded deed transferring the real estate to the trust.

In the Mendelson case, the chain of title to the house was complex. In 2005, Diane Mendelson executed the deed that placed title to the house in joint tenancy with herself and her son. The deed was never recorded because she enjoyed a property tax benefit as the sole title owner of the property.

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Alena Hammer owned and resided in a house located in Villa Park, Ill. Her mortgage was serviced by AmTrust Bank until AmTrust failed and was taken over by the FDIC in November 2009. The mortgage did not include an escrow account, and Hammer paid her real estate taxes and property insurance separately.

Hammer, 65, entered into a loan modification agreement with the FDIC as receiver for AmTrust in June 2010. She had been laid off from her job the year before. Hammer’s mortgage loan was then transferred to the defendant Residential Credit Solutions (RCS) in August 2010. RCS began rejecting the plaintiff’s monthly mortgage payments in September 2010 and refused to acknowledge the existence of the loan modification agreement.

RCS then pursued two separate foreclosure actions against Hammer despite the fact that she was still up to date on her monthly payments as required under the loan modification agreement.

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Late in 2002, the developer of 1717 S. Prairie Ave. in Chicago, Ill., retained the defendant Hansen & Hempel Co. to complete the masonry work for a 23-story condominium complex. When the building was nearly finished in March 2004, it started to experience water leakage. The condominium association, Board of Directors of the Prairie District Homes Tower Condominium Association, hired an engineering firm to design and implement a repair that was estimated to cost over $6,500,000.

Because of the report on the defects to the building, the association filed a lawsuit wherein the case was tried to a jury on the sole issue of breach of implied warranty of habitability.

The plaintiff board of directors of the condominium association contended that 90% of the through-wall flashing in dams installed by the defendant masonry company were either missing or installed improperly and claimed that because of those material defects it allowed water to penetrate the inner cavity of the building.

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In a case that involved thousands of toxic tort liability cases, the Illinois Appellate Court has ruled that an industrial manufacturer must turn over documents it alleged were privileged to a company indemnifying it.

In March 1999, automotive systems manufacturer BorgWarner Inc. acquired Kuhlman Corp. and its subsidiaries, including Kuhlman Electric Corp (KEC).

Since the 1950s, KEC has operated a facility in Mississippi that produces electrical transformers. As part of the Kuhlman Corp. sale, KEC represented that there was no soil contamination on its Mississippi property.

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In 1952, the owner of a parcel of land in Illinois granted a pipeline operator an easement for two pipelines to cross his land. The first pipeline was built immediately.

The easements specified that the second pipeline, if constructed, was required to be built within ten feet of the first pipeline. The pipeline operator promised the landowner that the land would remain farmable.

In 2012, the current pipeline operator notified the landowner that it planned to build the second pipeline. The owner responded with a lawsuit to quiet title. The pipeline operator removed the case to the federal district court under diversity jurisdiction.

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The Illinois Appellate Court has reversed and remanded a decision by a Cook County Circuit Judge relating to a sale agreement for a condominium purchase. In November 2010, the Habitat Co., the Gautreaux Development Manager for the Chicago Housing Authority, signed a purchase and sale agreement with Tera Healy to buy her condominium for $250,000. The contract was contingent on Habitat and Healy getting final approval from the U.S. Department of Housing and Urban Development (HUD) and Healy’s lender approving a short payoff.

These approvals were met, but the 3721-3723 Elston Condominium Association intervened, exercising its right of first refusal and purchased Healy’s condominium. The housing authority filed a lawsuit against the association, charging it with tortious interference of contract and breach of contract, seeking specific performance: the sale of the condominium.

The authority argued that the contract between Habitat and Healy was valid and binding. Moreover, the authority argued that the association did not have the right of first refusal contained in any of its declarations or bylaws, but nonetheless attempted to exercise this right.

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Craig Yale was a limited liability member of Wolcott LLC, a real estate development operation.  The two plaintiffs, Dr.Biplob Dass and Brett Garry, brought a lawsuit against Wolcott LLC, claiming they were duped when purchasing a garden condominium unit from Wolcott.

In the complaint it was alleged that the unit flooded several times;   they also discovered that the promised inspection and repair work that would have eliminated the water hazard had not been done by Wolcott.  At first, Dass and Garry did not know that Craig Yale was a member of the limited liability company. 

When Wolcott filed for bankruptcy protection and its debts were discharged, Dass and Garry sued Yale. The trial judge in the case dismissed the fraud claim against Yale based on §10-10 of the Illinois Limited Liability Company Act.  On appeal, the Illinois Appellate Court affirmed by stating that Dass and Garry “do not argue that Yale defrauded them in his individual capacity and do not argue that Yale should be liable through the doctrine of piercing the corporate veil.”

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In 2011, Gloria Won intended to purchase a residence from Grant Park 2 LLC. Since the deal she anticipated fell apart, Won filed a breach of contract and breach of fiduciary duty lawsuit against Grant Park 2. In that suit, Won alleged that Grant Park 2 chose not to meet the contractual closing date and willfully intended to deprive her of the return of her earnest money deposit that she gave for the intended purchase.  In responding to the lawsuit, Grant Park 2 filed an answer, affirmative defenses and counterclaims.

In August 2011, Won filed a motion for summary judgment.  The motion was denied by the court, which found that there were issues of fact existing regarding an oral agreement that would have extended the closing date.  However, after hearings discussing the issue of fact in the case, Won refiled her motion for summary judgment again in January 2012.  Grant Park 2 filed a cross-motion for summary judgment in response. 

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