Kupper v. Powers
71 N.E.3d 347
Ill. App. Ct.2017Background
- In 2006 plaintiffs (the Kuppers as beneficiaries/trustee) and defendant Powers entered an Agreement for Warranty Deed for a 13‑unit building in Peoria; buyer was to make monthly payments and a balloon payment due October 1, 2013.
- Plaintiffs sued in 2014 for possession and rent after alleging Powers defaulted by failing to pay the balloon payment and real estate taxes.
- Powers counterclaimed, alleging plaintiffs misrepresented zoning (stating 13 units were lawful) and asserted negligent misrepresentation and (earlier) a Consumer Fraud Act claim.
- The trial court dismissed the counterclaims (fraud and negligent misrepresentation) with prejudice, concluding zoning statements were statements of law and plaintiffs owed no public duty to supply zoning information; the Consumer Fraud Act claim dismissal was later deemed forfeited on appeal.
- After procedural back-and-forth and a dismissed interlocutory appeal, the trial court granted plaintiffs summary judgment based primarily on Powers’ admitted failure to pay real estate taxes and other contract breaches; the appellate court affirmed.
Issues
| Issue | Kupper's Argument (Plaintiff) | Powers' Argument (Defendant) | Held |
|---|---|---|---|
| Whether alleged statements about zoning density are actionable fraudulent misrepresentations | Statements were legal characterizations (not factual) and thus not actionable | Statements were factual (13 units existed and were represented as lawful) and defendant reasonably relied on them | Court held statements were statements of law/discoverable via ordinance; fraud claim dismissed |
| Whether plaintiffs owed a public duty supporting negligent misrepresentation | Peoria zoning ordinance (zoning certificate requirement) does not create a public‑duty to supply zoning info to buyers | Ordinance and practice created a duty to provide accurate zoning/nonconforming‑use info to buyers | Court held no public duty under the ordinance; negligent misrepresentation dismissed |
| Whether Consumer Fraud Act claim survived dismissal | Deceptive act element not met because alleged misrepresentations were of law | Representations were deceptive and caused reliance/harm | Appellate court found claim forfeited by subsequent amended pleading and, alternatively, would fail on merits because statements were of law |
| Whether trial court properly granted summary judgment for plaintiffs | Plaintiffs demonstrated undisputed breaches (unpaid taxes, missed payments, no insurance) entitling them to relief | Defendant disputed some defaults, claimed closing never occurred so balloon payment not due; raised facts about zoning affecting financing | Court affirmed summary judgment: undisputed failure to pay real estate taxes (2011–2014) alone supported forfeiture/summary judgment |
Key Cases Cited
- Stichauf v. Cermak Road Realty, 236 Ill. App. 3d 557 (1992) (zoning representations were statements of law; buyer could discover nonconformity by reviewing ordinance)
- City of Aurora v. Green, 126 Ill. App. 3d 684 (1984) (zoning map/available public info should alert buyer to investigate nonconforming use)
- Kinsey v. Scott, 124 Ill. App. 3d 329 (1984) (seller’s false claim about permit/units can be factual misrepresentation when buyer could not readily discover defect)
- Tan v. Boyke, 156 Ill. App. 3d 49 (1987) (seller must disclose permit/plat discrepancies known only to seller; factual misrepresentation when not discoverable by simple ordinance review)
- Perkins v. Collette, 179 Ill. App. 3d 852 (1989) (distinguishes City of Aurora; whether misrepresentation was discoverable by ordinance review is dispositive)
- Lehmann v. Arnold, 137 Ill. App. 3d 412 (1985) (statutes or filings required for public record may create a public duty to furnish accurate information)
- Brogan v. Mitchell Int’l, Inc., 181 Ill. 2d 178 (1998) (negligent misrepresentation limited to those supplying information in course of business or under a public duty)
- Capiccioni v. Brennan Naperville, Inc., 339 Ill. App. 3d 927 (2003) (elements of Consumer Fraud Act claim)
- Foxcroft Townhome Owners Ass’n v. Hoffman Rosner Corp., 96 Ill. 2d 150 (1983) (amending a pleading generally waives objections to prior dismissed counts)