*1 insurer, knowledge that her has not reached the or serve as premium payment late, reminder that where the insured has letting addition, no intention of policy lapse. In an actual notice requirement protect parties, mortgagees will interested such as lienholders, probably who are premiums otherwise not aware being paid are not become aware of such information in protect time to their interests. its cross-motion for judgment, Marketview admitted purposes the limited of that motion that it received notice of However, nothing
cancellation. in the record demonstrates when actually pleadings Marketview agreement received notice. The also indicate dis- parties causing between the as to when accident Ascertaining loss policy occurred. the date the effectively- (i.e., cancelled when days’ expired) Marketview’s 10 actual notice actually the date the accident occurred are factual issues the trial court must resolve.
III. CONCLUSION stated, For the reasons we trial judgment reverse the court’s proceedings remand for opinion. further consistent with this Reversed and remanded. KNECHT,
GARMAN and concur. JJ.5 STEEL, INC., al., Plaintiff-Appellee, ALLIANCE v. CURTIS B. PIERCY et Defendants). Defendants-Appellants (Pre-Engineered Steel, Inc., al., et Fourth District No. 4 — 95—0395
Opinion filed
GARMAN,J., dissenting. Gaumer, Winters, Featherstun, Kenney, Kenney (argued),
Frederic L. of Stocks, Decatur, appellants. for Postlewait & Peoria, (argued), Keck, Cate, & appel- David G. Lubben Mahin for lee. COOK opinion
PRESIDING JUSTICE court: The trial summary judgment court entered in favor of a subcon- (materialman) brought tractor who had suit to a foreclose mechanic’s appeals. lien. The owner We reverse and remand.
The affidavits filed in connection with motion judgment following show the facts. Curtis B. owns 12, 1991, oper- Carlock, Body August ates Auto On Illinois. (the Steel,
entered into a contract with Inc. contrac- tor), building place steel erect a of business. Under the contract, Piercy $39,000. pay was to The contractor subcontract, Steel, August turn entered into Inc., building supply steel which unassembled would be erected. subcontract, $18,808. Under the contractor was to 7,1991, On October an Alliance driver truck delivered steel build- ing Piercy jobsite. materials The Alliance truck driver requested Piercy pay delivery, for the materials on accordingly gave check, showing the driver cashier’s Piercy as the remitter, payable $26,605. to the contractor in the 8, 1991, by Herring, The check was received on October John Al- supervisor. Herring immediately liance’s former accounts faxed *3 copy copy appear of the fax check contractor. On the (1) following you tonight please notations: send "Will airborne to (2) (3) return,” John,” "Thanks, "20,000.” brief, In its Alliance is Herring states the record not clear whether made all John these notes, suggests that may someone in the contractor’s office have "20,000” Alliance, fax however, written after the was received. did Herring. not submit affidavit from $26,605
The contractor received the airmail on October day prepared 9. That same returned Alliance $20,000 $20,000. check in amount of check was received and negotiated by Alliance on October 9. previously other projects contractor been involved in supplier building
where Alliance materials. October proj- than on those contractor owed Alliance more that, practice in of directions ects. Alliance’s the absence apply payments it would it received from the contrac- discretion, unpaid at its on the oldest Sometime usually tor invoices. meeting in October there was a between the contractor and Al- bring liance to the contractor current on its discuss need unpaid time, going Around this same Alliance decided was debts. Alliance projects. When contractor’s against the filing liens to start apply that check, Alliance did the contractor’s received accounts, Nos. to two older instead Piercy but 11029. 10796 and 90-day 30, 1992, mailed subcontractor’s Alliance On days after more than Piercy. That was lien to notice of claim of president Alliance’s October but furnished on materials were that the date later and furnished materials were testified that other 7, 1991. On October delivery was November of last apply it directions to check to sent a $500 11, 1992, the contractor December Then on in error and check was Alliance, stating that the $500 a letter to sent 9, 1991. on October job paid in full Body real estate Auto its lien Alliance recorded its lien on action to foreclose February then filed this judgment court entered February 1993. The trial Piercy appeals. February of Alliance on favor duty (West section 5 of under argues that breached 1994)) (Act) (770 to demand ILCS Lien Act the Mechanics 60/5 listing the subcontrac- from the contractor a sworn written statement suggests that become due each. tors and amounts due or to favor, although recognizes requires judgment fact alone way, Alliance in a second himself and "Piercy protected have could to have with- way would have been again not.” That second but receiving assurance Alliance until sufficient to held an amount waiver) paid. Alliance had been (perhaps lien owners, rights and duties attempts The Act to balance (materialmen). A contractors, subcontractor and subcontractors (and thereby itself protect of its claim give the owner written notice disbursements) any after the subcontractor time against subsequent than but no later contract with the enters into its (770 completion of the contract. days after subcontractor’s 1994).) (West gives notice never Even the subcontractor ILCS 60/24 making any payments, duty, owner, it before is the owner’s written statement provide a sworn general contractor to require the due each. to become amounts due or listing the subcontractors 1994).) (West gives a that the contractor 60/5, The fact ILCS protec however, complete statement, not afford does written sworn against subcontrac protected The owner tion to the subcontractor. state written on the sworn amounts understated tors not listed or *4 knowledge or collusion the omissions are with ment unless those (West 1994).) (770 relies who A subcontractor ILCS the owner. 60/27 accordingly puts written statement on contractor’s sworn the trust in the contractor.
636 provides
The Act the shall pay that owner not be to greater price than payment the contract "unless be made rights the contractor in violation of the the and interests of (770 (West persons by intended to be benefited act.” this ILCS 60/21 1994).) provides payments The Act that no to the be contractor shall regarded made, rightfully "if made the owner without exercis ing enforcing rights powers upon the conferred him in sec (West 5, 1994).) tions 21 and 22 of Act.” this ILCS That is 60/32 say, however, not to every that paid time a subcontractor is not full there is a claim require owner. The Act not does the owner lien any obtain waivers before the owner payments. makes (Contractors’ Ready-Mix, (1993), Inc. v. Earl Given Construction Co. (where Ill. App. 242 3d 611 N.E.2d 534-35 sworn written statement understated the amount due the subcontrac tor).) The failure to obtain contractor’s sworn written statement liability not part does result absolute on of the owner. As Alli concedes, steps there are other which an owner take to protect itself. complaint
Alliance concedes that could if Piercy have had included on payable its name check made to the contrac- tor, even if had not obtained a sworn contractor’s written case, present appears statement. In equiv- that Alliance had the alent of its name on pos- the check: the check was into (and did) by Piercy, session impose any and Alliance was free to negotiation conditions it chose on the contractor’s of that check. contractor; make not he made Alliance, although his check had the contractor’s dif- name it. It is ficult to see how would have been better off if requested a contractor’s sworn written before gave payable check made to the contractor.
It is no defense under the Act that has owner (Hudson contractor the amounts v. Caterpillar due subcontractor. 883.) (1983), Tractor Co. An simply pays owner who the contractor runs the risk that the contrac will fail if pays tor subcontractor. Even the contractor subcontractor, general payments will owner runs the risk A designated particular to his account. owner is not entitled general undesignated payments credit for subcontractor, later from the the funds are traced owner (See contractor to the subcontractor. Liese v. Hentze 633, 638-39, pay If the contractor does make N.E. subcontractor, however, designates pay ment to the ment be the owner will have owner’s *5 sworn writ a though he not contractor’s defense, has Industries, Grammer Inc. v. Lumber See Associated ten statement. App. 54 Ill. $20,000 in focused on the contractor’s trial court this case any Alliance, did not make concluding that the contractor check to may applied. The court how funds would be specific designation those designation, specific made no very that the contractor well be correct $20,000 came from. knew where the although it seems clear Alliance contractor, designation by the other specific Even there is no where payment the may require apply subcontractor to circumstances the delivery important here is the to is most the owner’s What day, but $26,605 check to the contractor previous the not $26,605 possession, its Al to Once the check in Alliance itself. it had project, appar itself on complete power protect to this liance had $20,000 $26,605, ently so, insisting the that it receive (which trusting its the contractor the contractor to forward share did). argues pure speculation that "it is that the source of Alliance $20,000 funds sent to was [the contractor] for check Alliance $26,605 Piercy, payable check and that Al- [the contractor] to eyes liance 'knew’ this was Alliance to the state- the case.” closes in legitimate ments contained the affidavits and the inferences to be voluntarily drawn therefrom. Even if Alliance did surrender $26,605 given by Piercy, requiring anything check without contractor, return from the Alliance has claim no further Piercy. along A subcontractor whose name on a check may contractor choose the check to endorse over may complain but not then that has breached he owner some duty under the Act.
Piercy may unwitting beneficiary be the Alliance’s efforts this Alliance a case. It be that was unaware that was was subcontractor have believed that itself fabricating building. may explain why, Alliance’s That when delivery, ready payment driver with a demanded it. check but the had the contractor’s name on If Alli- cashier’s so payment had not been careful to demand when materials possible Piercy jobsite, were it is would have to and when given his check (if so), payment contractor it did could payment have applied past accounts and then liened the Piercy job. got money certain that it from When Alliance made however, Piercy, longer take that it position could no had not money Piercy. obtained the 428), Liese N.E. contractor built house for
Hentze, and the subcontractor furnished lumber. The subcontractor $1,212.96, notified Hentze the whereupon subcontractor owed $4,000 Hentze obtained a loan and to the contractor. The immediately wrote a to the subcontractor in the $1,000, but without instruction how the was to applied. The subcontractor other had accounts with the contractor reason to believe that was to be supreme Hentze’s account. The court held Hentze was not entitled to $1,000, designation by credit because in the of a absence debtor the creditor could as it chose. Alliance points the following statement: "Where the owner makes requiring to a contractor without referred to in the [A]ct[,] peril.” (Liese, Mechanic’s Lien he at does so at peril referring N.E. the court was *6 subcontractor, contractor would either not or the contractor’s payment designate would not account be to credited. court liability did not hold if there was absolute the owner failed to obtain Liese, a In contractor’s written statement. the owner would have designated been a entitled to credit the contractor how the applied, should be if the owner had not a Liese, gave contractor’s written statement. subcontractor, check to the our unlike case where the owner himself gave to the subcontractor. argument
We need not address that it is fraudulent for a subcontractor, recognizing problems has financial with a payments jobs from current the contractor to old jobs and then lien the current which it are the of knows source those payments. grant summary judg
Our review of trial decision court’s (Outboard Liberty Corp. ment is de novo. Marine v. Insurance Mutual Co. 154 Ill. 2d For reasons stated, granting judg reverse the trial court’s order we proceedings. ment to Alliance and remand for further Reversed and remanded.
GREEN, J., concurs. CARMAN, dissenting:
JUSTICE findings fact, judge following of war- The trial which quoted being rant in extenso:
"First, 1991[,] August 12th a was into be- on of contract entered owner, Piercy, property Defendant Curtis tween Steel, job a project, Pre-Engineered for this A complete for it. Pre-Engineered Steel to that the owner wanted Pre- days later, August of on 27th few Steel[,] [Alli- Plaintiff a contract with the Engineered entered into project, supply for this material Steel] a subcontractor $18,808. paid the material that was was and the amount for Thereafter, part on 7th of the Plaintiff October $26,605 check, got job to the from Mr. material site Steel, payable Pre-Engineered and the Plaintiff which was made Pre-Engineered after then on to Steel receiv- forwarded later, [Piercy], 9th, days ing October it from Mr. Curtis On two 1991, Pre-Engineered Steel sent to the Plaintiff a check. was no or on the check itself as There indication direction particular applied, and account as to which the check should be applied Plaintiff it to an which older than the the Piercy account On the 7th November of Plaintiff of job completed delivery its to the On materials site. Piercy. Plaintiff on Mr. It is 31st served notice claimed February under this on 20th of the Plaintiff re- contract 24th, August its lien Mr. served corded Pre-Engineered on indicating on Steel with document a release part Pre-Engineered acknowledgement Steel from and an Pre- Engineered payment by Steel of full him on with the contract Pre- Engineered 29th, 1992, Pre-Engineered Steel. On October Steel Plaintiff, sent which $500 11th, is a and there letter dated December Pre-Engineered suggesting Steel to Plaintiff a belief job part Steel 9th, Plaintiff was in full 1991.It to the Court October seems in this significant those are the dates and events occurred sit- chronologically.” uation *7 granted summary judgment
The court to Alliance on the follow- (1) ing grounds: $20,000, the an in excess of payment of the ($18,808), price Pre-Engineered contract and between (2) contrary prior dealings parties; to the course of between the the $26,605, given again amount of the check excess of (3) Pre-Engineered; Alliance and $500 subcontract between year delivery the final directed almost after —made —was by indicating applied to be meant the earlier was not to be (4) account; of equity and the side because unpaid, Piercy project remained so far as the was concerned. provide extraordinary remedies to purpose The of the Act is to 640 (First
certain classes of contractors and v. subcontractors. Bank 1210.) (1994), App. Rinaldi 262 Ill. 3d 634 N.E.2d Once the lien has complied statutory claimant require ments, Act liberally should carry be constmed to out its remedial purpose allowing recovery of where the property value of the has (First by been furnishing Bank, increased labor or materials. 262 Ill. App. 3d at 634 party seeking N.E.2d While the enforce a lien "scrupulously must ]” the terms of Act observe! (First Bank, 1210), App. Ill. 3d at 634 N.E.2d at they once this is done, the Act of alerts owners what should do in order to avoid Tile, liability. double Cabinet Service Inc. v. Schroeder App. record indicates that did not request the affidavit
required by section 5 of Act and escape therefore should not liability. double provides: Section 5 Act *** duty "It shall be require of the owner to of the contrac- *** tor, pay before the owner shall or be cause to any moneys contractor or to his order or other consideration due ***
or to become due to in writing, by affidavit, under oath or ike names and addresses verified of of furnishing parties all labor materials and the amounts due added.) (770 (West (Emphasis or to becomedue to each.” ILGS60/5 1992).) Section specifically provides: 32 of the Act payments any money
'Wo contractor or his order or other considerations due or to due to become the contractor shall *** made, regarded rightfully as as the sub-contractor materials, party furnishing or labor or made the owner exercising enforcing rights without powers conferred added.) (770 upon him in (Emphasis ] this Act.” section! 1992).) (West ILGS 60/32 Thus, Act, Piercy’s payment under section 32 cannot be regarded "rightfully question as made.” that Piercy There is therefore, affidavit; requisite genuine obtain the there is no issue fact, properly granted summary judg- of material trial court protected ment. fact that could have himself other means is irrelevant. law emphatic.
The case 3d at Hudson 883), payments N.E.2d at an to a owner here, failing, required to obtain the affidavits. This court held that price than though owner had more the total contract lien, discharge order to this was not defense the subcontractor’s obtaining Payments owner could raise. made without authority affidavits are at risk. The chain of the owner’s unbroken
641 (1987), See, Biggs v. Ambrose e.g., 1891. to at least dates back this rule Products, Inc. 614; Concrete N.E.2d Swansea 509 App. Ill. 3d 156 388; 927, 467 N.E.2d (1984), App. 3d 126 Ill. Distler v. Deerfield (1979), App. Associates, 74 Ill. Inc. & Jaeger W. Co. v. Herbert Electric (1954), App. 2d 3 Ill. 914; Collins v. Seiden Barr & 392 N.E.2d 3d Co. v. Carl 380; Construction Stanley J. Gottschalk (1911), Bollinger v. 520; Lumber Co. (1929), Mueller App. Ill. son App. 34 Ill. 402; v. Plant App. 160 Ill. Conklin However, the regrettable. is Piercy’s predicament agree I li- himself to double Piercy exposed clear. could not be more law making before required affidavits to obtain the ability he failed when ease Furthermore, I am troubled payment to the contractor. oversight, especially majority excuses with which his auto for construction the contract was considering the fact that his not be excused Surely owner should body shop. a business position in a Act when he is provisions of the failure to follow the applies to his business. the law as it understand grant of supports the majority in fact cited The case law (326 Ill. example, in Liese summary judgment in this case. For who, turn, in 428), general paid a N.E.2d an owner here, owner, not ask for the sworn The as did paid a subcontractor. and, here, provide did not by the Act as these circum payment. Under application directions as or reason stances, was "no basis supreme court held that there our (Liese, Ill. in Act. set out rule” for deviation from 430.) emphasized: at It at 158 N.E. *** may protect himself before provides the owner "Section 5 supply a money the contractor to by requiring concerning the bills of sub-contractors sworn statement payment to a contrac makes Where the owner materialmen. he [Act] referred to requiring the statement tor without Liese, at 430. at 158 N.E. peril.” at 326 Ill. does so his out that distinguish pointing majority attempts to Liese if the contractor to a credit have been entitled "the owner would if the owner applied, even payment should be designated how the (277 App. statement.” required a contractor’s written had not 638.) designate how the Here, however, Piercy not agree. I pay fact, he made the applied. In payment should be obligations Alliance. He violated Pre-Engineered, not able to unfortunate, the conse and, must now bear Act, however under quences. circumstances stating that "other majority is correct ac- owner’s payment to the
require the subcontractor count.” 3d at No such other circumstances are present that, Act emphatic here. The for an request absent affi davit, is wrongful, the subcontractor. The majority appears mostly equitable to reverse the trial court grounds. However, he who requests equity equity. must do Since Piercy’s payment i.e., made, wrongful, rightfully equitable relief inappropriate. *9 Finally, majority points out that "made certain that got money Piercy.” from 3d at record contention, support though.
does not this An Alliance driver received $26,605 check from pay on October 1991. This able Pre-Engineered. Alliance transmitted the check to Pre Engineered $18,808 on October 1991. Alliance due Piercy job. day, 9,1991, The same October Alliance received Pre-Engineered check from application. with no as to direction later, year Pre-Engineered Over a on October sent a $500 Alliance, check to directions account. 11, 1992, self-serving record also contains December and con tradictory letter which Pre Engineered Coupled claims that check was in error. with a $500 discrepancy ($18,808). Piercy job between cost of the the amount ($26,605) and the of the payment to Alli ($20,000), payment proves that Alliance did not receive $500 for the here,
I see reason for from the deviation rule nor do I special reversal, warranting see circumstances and would affirm. SNOW, MARRIAGE OF WAYNE re JOHN Petitioner lee, SNOW, Counterrespondent-Appel Respondent LUDENE C. Counterpetitioner-Appellant.
Fourth. No. District 4 —95-0431
Opinion filed