Triple R Development v. Golfview Apartments I
2012 IL App (4th) 100956
Ill. App. Ct.2012Background
- Contract dated May 7, 2007 for sale of Golfview Village Apartments at $21 million; closing within 150 business days.
- Golfview deposited $230,000 with CB&K as escrow; due diligence period allowed termination or nonrefundable deposit under contract terms.
- Paragraph 5.A. provides $230,000 nonrefundable after due diligence unless seller defaults; exception survives termination for certain obligations.
- Paragraph 10.F. requires Buyer to determine eligibility for tax credits; failure to obtain credits can trigger termination and refund of earnest money.
- Golfview did not terminate during due diligence and contends it determined eligibility, prompting dispute over whether deposit should be returned or forfeited.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether deposit forfeiture was proper given tax-credit condition | Triple R/CB&K: deposit nonrefundable after due diligence unless seller default; Golfview’s lack of termination does not negate nonrefundable provision | Golfview: contract automatically terminates if tax-credits not determined, entitling refund | Yes, deposit awarded to Triple R; summary judgment affirmed |
| Effect of paragraph 10.F. on closing and obligations | Golfview determined eligibility; reliance on appraisal supports obligation to close | Eligibility determination not proven; closing should not be compelled | Paragraph 3 and 10.F. are alternatives; either condition can trigger closing; court upheld enforcement of deposit obligation |
| Burden on movant in summary judgment for affirmative defenses | Triple R produced evidence; Golfview failed to counteraffidavit | Plaintiff failed to negate Golfview’s defense; burden not met | Summary judgment proper; plaintiff met burden; defendant’s defense not proven on record |
Key Cases Cited
- Bamberg v. Griffin, 76 Ill. App. 3d 138 (Ill. App. 1979) (earnest-money as protection for seller; forfeiture discussed)
- Purtill v. Hess, 111 Ill. 2d 229 (1986) (burden-shifting on summary judgment; production/disproof standards)
- General Motors Corp. v. Douglass, 206 Ill. App. 3d 881 (Ill. App. 1990) (plaintiff movant must prove all essential elements and defenses on motion)
- West Suburban Mass Transit District v. Consolidated R. Corp., 210 Ill. App. 3d 484 (Ill. App. 1991) (analysis of summary judgment burdens of persuasion and production)
- Denis F. McKenna Co. v. Smith, 302 Ill. App. 3d 28 (Ill. App. 1998) (forfeiture/forfeiture-equitable considerations in contract)