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SIXTH DIVISION
June 8, 2001

This case arises out of a 1984 real estate transaction inwhich defendant-appellant Amoco Oil Company (Amoco) agreed totransfer a service station site to plaintiff-appellee Bond DrugCompany of Illinois (Bond) in exchange for properties worth$1,175,000. When Amoco failed to comply with the terms of theparties' agreement, Bond sued for specific performance and Amococounterclaimed for rescission. On cross-motions for summaryjudgment, Judge Hourihane entered judgment in favor of Amoco,denied Bond's motion, and rescinded the contract. On appeal, thiscourt reversed summary judgment in favor of Amoco, reversed thedenial of Bond's motion for summary judgment, and remanded the casewith directions for the trial court "to conduct another hearing andreconsider Bond's motion and the relief requested, taking intoaccount what is stated herein." Bond Drug Co. v. Amoco Oil Co.,274 Ill. App. 3d 630, 636 (1995). On remand, the trial courtgranted Bond's motion for summary judgment and ordered specificperformance of the contract. Amoco now appeals and raises thefollowing issues: (1) whether the trial court complied with thiscourt's mandate; (2) whether paragraph 17 of the exchange agreementapplies to the environmental contamination on the premises; (3)whether the exchange agreement should be rescinded due to mutualmistake of fact; (4) whether enforcement of the agreement isunconscionable; and (5) whether the trial court properly orderedspecific performance on remand.

I. BACKGROUND

On December 21, 1984, Amoco entered into a contract (theExchange Agreement) with Bond concerning a parcel of real estateowned by Amoco located at the corner of Fairbanks and Ohio Streets(the Premises) in Chicago. At the time, the Premises was occupiedby an Amoco gas station pursuant to an Amoco lease agreement andcontained underground gasoline storage tanks. Bond, a subsidiaryand real estate arm of Walgreen Company (Walgreen), wanted toacquire the Premises as a site for a Walgreen drug store.

The Exchange Agreement provided that Bond would deposit thepurchase price of $1,175,000 into an escrow account; that theescrow funds would thereafter be used by Bond to acquire propertyor properties as designated by Amoco in exchange for the Premises;that the exchange property or properties would have an aggregatevalue of approximately $1,175,000; that the final closing under theExchange Agreement was to take place two years after Bond depositedthe $1,175,000 in the escrow account; and that at the final closingAmoco would convey title to the Premises to Bond and Amoco wouldreceive any amount of money remaining in the escrow account. Inaddition, paragraph 17 of the Exchange Agreement provided that ifzoning, building, fire or health code violations were found toexist on the Premises prior to Bond taking title and possession,Amoco would correct them.

After executing the Exchange Agreement, Bond paid $100,000 toAmoco's gasoline station lessee of the Premises for a waiver of thelessee's right of first refusal on any sale of the Premises byAmoco. On October 7, 1985, Bond deposited the $1,175,000 into theescrow account. In 1986, Amoco designated property it desired inWauwatosa, Wisconsin, which was purchased by Bond for Amoco withfunds from the escrow account. Amoco has since had use andpossession of that tract for a gas station. Bond has not purchasedany other properties under the Exchange Agreement and the remainderof Bond's funds remain in the escrow account.

In September 1987, shortly before the final closing under theExchange Agreement, Amoco notified Bond that Amoco wanted to testthe Premises for groundwater contamination that might have beencaused by leaking underground gasoline storage tanks. Thereafter,because of Amoco's requests, the final closing was repeatedlydeferred. On May 27, 1988, Amoco found that there was environmental contamination on the Premises that would have to be corrected. On April 17, 1989, pursuant to the Illinois EnvironmentalProtection Act (EPA) (415 ILCS 5/57 et seq. (West 1996)), the IllinoisEnvironmental Protection Agency (IEPA) sent Amoco a notice ofdischarge or release of petroleum into the environment at thePremises caused by leaking underground gasoline storage tanks.

On November 17, 1989, Amoco advised Bond that it would notconvey the Premises to Bond as provided in the Exchange Agreementand that it considered the Exchange Agreement terminated because ofthe unexpected cost of having to correct the Premises contamination.⁽¹⁾ Attempts by Bond to persuade Amoco to fulfill the terms ofthe Exchange Agreement failed. On July 23, 1990, Bond filed anaction against Amoco seeking specific performance of the ExchangeAgreement. On August 27, 1990, Amoco answered and asserted a counterclaim for rescission based on mutual mistake and impossibility. Both parties filed motions for summary judgment. The trial courtgranted summary judgment in favor of Amoco and denied Bond's motionfor summary judgment. Bond appealed. On appeal, this courtreversed the trial court's decision as to both Amoco's and Bond'ssummary judgment motions and remanded the case. Bond Drug Co. v.Amoco Oil Co., 274 Ill. App. 3d 630 (1995) (hereinafter Bond I).

Bond I decided the following issues. First, with respect towhether paragraph 17 of the Exchange Agreement applied to theenvironmental contamination on the Premises, Bond I held "[t]heplain language of paragraph 17 requires Amoco to correct all healthcode violations of any governmental authority that exist on thePremises" and that "EPA violations due to leakage from undergroundgasoline storage tanks causing environmental contamination areclearly health code violations." Bond I, 274 Ill. App. 3d at 633-34. Second, with respect to whether the trial court erred inawarding rescission of the Exchange Agreement due to a mutualmistake of fact, Bond I held "[t]here was no mutual mistake of factin this case. Rather than a mutual mistake of fact, this caseinvolves a unilateral mistake in the cost to be incurred forperformance of the contract" and "is not a basis for rescission." Bond I, 274 Ill. App. 3d at 635. Finally, with respect to whetherthe court correctly ruled that the Exchange Agreement should not beenforced because enforcement would be unconscionable, we held thatthe doctrine of unconscionability did not apply and stated:

"No equitable principle, including unconscionability, will compel the cancellation of avalid contract merely because one of the parties thereto will possibly or probably sustaina loss. Where the parties to an instrument arecompetent to contract with each other, andthere is no question of fraud, neither can berelieved from his agreement on the ground thathe did not use good business judgment inentering into the contract. [Citation.] Moreover, Amoco is required to bear the cost ofcorrecting the contamination from the underground gasoline storage tanks pursuant to EPAregulations whether or not the Exchange Agreement is enforced.

In addition, if the Exchange Agreement isenforced according to its terms, Bond willmerely receive what it is supposed to receiveunder the Exchange Agreement. It will notreceive a windfall or some type of serendipitous benefit. This is especially true sinceBond deposited the total purchase price in anescrow account, paid Amoco's lessee of thePremises $100,000 for a waiver of firstrefusal with respect to purchasing the Premises, and prior to the scheduled closing Bondallowed Amoco to use a portion of the escrowfunds to acquire the exchange tract foranother gas station site. Thus, there isnothing unconscionable about enforcing theExchange Agreement." Bond I, 274 Ill. App. 3dat 636.

Bond I concluded:

"[T]he summary judgment in favor of Amocois reversed. The denial of Bond's motion forsummary judgment is also reversed. The trialcourt is to conduct another hearing and reconsider Bond's motion and the relief requested,taking into account what is stated herein. Thecase is remanded for further proceedingsconsistent with this opinion." Bond I, 274Ill. App. 3d at 636.

Appeal to the Illinois Supreme Court was denied. See Bond Drug Co.v. Amoco Oil Co., 164 Ill. 2d 558 (1995).

On remand, the case came before Judge Stephen A. Schiller. The parties appeared before Judge Schiller for the first time onFebruary 28, 1996. Bond argued that all the trial judge had leftto do was enter a summary judgment order in its favor and "to shapethe order." Amoco argued that the judge was to review ourdetermination with regard to the issue of unconscionability, whichthe judge refused to do. Judge Schiller determined that ouropinion foreclosed his determination of many of the issues on thesummary judgment and that he was left "to consider the reliefrequested." Nevertheless, the judge granted the parties theopportunity to file supplemental briefs on Bond's original summaryjudgment motion.

The next hearing took place before Judge Schiller on June 18,1996. At the hearing, the judge asked Amoco which factual issuessurvived the determinations made in Bond I. Amoco responded thatthe remaining issues of fact were unconscionability and rescissionbased on a mutual mistake. After considering the supplementalbriefs, the additional affidavits submitted by Amoco, and thearguments of the parties, Judge Schiller concluded:

"[Counsel for Amoco] has conceded - and Ithink quite properly so, and I think in thebest tradition of advocacy - that what he seesas the two remaining factual issues, that ofunconscionability, that of mutual mistake. The Appellate Court [in Bond I] has made four-cornered, square findings on those issues. The only thing I can grapple with in terms ofwhat is raised in the affidavits and the arguments that appears not to be covered by themandate of the Court is potentially - and Ibelieve I am reaching to try to find somethingthe possibility of impossibility⁽²⁾, and I findthat that issue is not fairly before me giventhe pleadings in this case. Accordingly, I amgoing to enter summary judgment for the Plaintiffs herein both in relation to theaffirmative defenses and claims of Amoco and withregard to the claims of Bond in the originalcomplaint.

That leaves open the question of remedy. I am going to give Bond, the Plaintiff tendays to submit to the Court a proposal ofremedies, and I am going to give Amoco tendays to object, to file their objections. Iam going to set this cause for hearing on thequestion of what my dispositive order shouldbe with regard to remedies on that issue alon[e]."

Bond's proposed remedy suggested that Amoco be required tocomplete remediation of the contamination of the Premises, obtaina "sign-off" letter from the IEPA that the remediation efforts weresufficient, and thereafter convey the property to Bond inaccordance with the terms of the Exchange Agreement. By agreedorder entered on March 18, 1997, Amoco was to attempt to obtainfrom the IEPA a "No Further Remediation" (NFR) letter from theIEPA. In the meantime, the trial court and the parties waited tosee if the IEPA would issue an NFR letter before proceedingfurther.

On September 21, 1999, the IEPA issued the NFR letter. Theletter provided that "(1) all statutory and regulatory correctiveaction requirements applicable to the occurrence have been compliedwith; (2) all corrective action concerning the occurrence has beencompleted; and (3) no further remediation concerning the occurrenceis necessary for the protection for human health, safety and theenvironment."

On October 29, 1999, after considering further briefs andhearing argument from the parties, the trial court entered itsfinal judgment requiring Amoco to specifically perform its obligations under the Exchange Agreement. On February 14, 2000, thetrial court denied Amoco's motion for reconsideration.

Amoco now appeals.

Amoco argues that Judge Schiller failed to comply with ourmandate. Specifically, Amoco asserts "the trial court's failure toconduct the required evidentiary hearing is a breach of its duty tofollow the appellate court's mandate and grounds for this Court toreverse its decisions and remand the case to fill the many gaps inthe record."

It is well established that " 'where the directives of areviewing court are specific, a positive duty devolves upon thecourt to which the cause is remanded to enter an order or decree inaccordance with the directions contained in the mandate. Preciseand unambiguous directions in a mandate must be obeyed.' " PuritanFinance Corp. v. Gumdrops, Inc., 101 Ill. App. 3d 888, 890 (1981),quoting Stuart v. Continental Illinois National Bank & Trust Co.,75 Ill. 2d 22, 27-28 (1979), and citing Smith v. Farmer's StateBank, 392 Ill. 456 (1946).

Here, our directive called for the trial court

"to conduct another hearing and reconsider Bond's motion [for summary judgment] andthe relief requested, taking into account whatis stated herein. The case is remanded forfurther proceedings consistent with this opinion." Bond I, 274 Ill. App. 3d at 636.

We find that our directive when viewed in context with theopinion and record as a whole is very clear. We also find thatJudge Schiller's actions on remand were completely appropriate andin accord with Bond I's mandate.

Our decision in Bond I disposed of all of Amoco's argumentsagainst Bond's motion for summary judgment. Amoco opposed Bond'smotion for summary judgment based on the following grounds: (1)paragraph 17 of the Exchange Agreement does not encompass environ-mental contamination; (2) the Exchange Agreement should berescinded due to mutual mistake of fact regarding the cost toremediate the environmental contamination; (3) enforcing theExchange Agreement would be unconscionable; and (4) specific performance is not an appropriate remedy. As discussed in detailabove, we held in Bond I that the contamination from the leakingunderground storage tanks was a violation under paragraph 17; thatthere was no mutual mistake of fact; and that the doctrine ofunconscionability was not applicable. Thus, Judge Schiller properly concluded on remand that he was bound by the law of the casewith regard to those issues. Under the law of the case doctrine,a court is bound by its prior rulings of law in opinions or ordersin the same case unless the facts require a different interpretation. Continental Insurance Co. v. Skidmore, Owings & Merrill, 271Ill. App. 3d 692 (1995).

"The rule of the law of the case is arule of practice, based on sound policy that,where an issue is once litigated and decided,that should be the end of the matter and theunreserved decision of a question of law orfact made during the course of litigation settles that question for all subsequent stagesof the suit." Continental Insurance Co., 271Ill. App. 3d at 696-97.

In light of the above, Judge Schiller properly determined thatgiven our resolution of the issues addressed in Bond I, summaryjudgment should be granted in favor of Bond.

Moreover, we also note that nowhere in Bond I did we makereference to the necessity of any type of evidentiary hearing. Rather, we directed only that a hearing be conducted. Indeed, contrary to Amoco's contention, a review of the record demonstratesthat Judge Schiller was more than generous with the extent ofhearings conducted on remand. The judge held hearings on whetherhe should grant summary judgment to Bond giving Amoco everyopportunity to present additional evidence appropriate to hisconsideration of Bond's motion. The court received affidavitssubmitted by Amoco in opposition to Bond's motion and expresslynoted in its ruling that it was doing so: "In terms of theaffidavits it should be noted for the record, I am considering themin terms of my disposition in this case so that the record isabsolutely clear." The court also allowed ample oral argument fromcounsel. In addition, after granting judgment in favor of Bond onthe issue of liability, Judge Schiller requested Bond submit aproposed remedy and allowed Amoco time to file objections thereto. Ultimately, the parties entered an agreed order on the issue ofobtaining the NFR letter from the IEPA. After receipt of theletter and after considering further briefs and further argument ofthe parties, the court entered its final judgment.

Accordingly, we conclude that Judge Schiller complied withBond I's mandate.

With respect to Amoco's arguments regarding issues previouslydetermined in Bond I, we find that the law of the case precludesour further review.

As stated by our supreme court:

" 'Where the Appellate Court *** on the firstappeal to it, announces a particular view ofthe law governing the case and reverses andremands the case for further proceedings inaccordance with the views announced, if thecase is again brought before such court forreview the former decision is binding on thecourt making it, and the questions decided anddetermined by it on the first appeal are notopen for reconsideration on the secondappeal.' " PSL Realty Co. v. Granite Invest-ment Co., 86 Ill. 2d 291, 312 (1981), quotingZerulla v. Supreme Lodge Order of MutualProtection, 223 Ill. 518 520 (1906).

Although we recognize that the law of the case doctrine is "not alimitation on our power to revisit an issue in circumstances wherefacts have changed or where we determine that our initial decisionwas clearly erroneous and would work a manifest injustice" (HarrisTrust & Savings Bank v. Otis Elevator Co., 297 Ill. App. 3d 383,388 (1988)), such is not the case here.

Accordingly, we reject Amoco's attempts to rehash thesealready resolved issues.

Finally, Amoco asserts that specific performance is not anappropriate remedy. We disagree.

"[W]here a contract is fairly and understandably entered into, does not containcircumstances of fraud or oppression, andinvolves only the sale and transfer of realestate, specific performance is allowable as amatter of right. [Citation.] That right isnot absolute, but rests within the sounddiscretion of the circuit court. [Citations.] As the decision rests within the sound discretion of the circuit court, this court willreverse only upon a showing of an abuse ofthat discretion." Vincent v. Vits, 208 Ill.App. 3d 1, 4 (1991).

Amoco's first argument is that specific performance is aninappropriate remedy because it requires the court to "impermissibly insert terms and obligations into the Exchange Agreement thatthe parties had not agreed to." Amoco asserts "ordering specificperformance requires that Paragraph 17 of the Exchange Agreement beinterpreted to encompass costs from environmental violations" andthat such costs should not be included. However, this issue hasalready been conclusively determined in Bond I. Paragraph 17encompasses environmental violations. Thus, contrary to Amoco'sassertion, the court's order of specific performance is not impermissibly inserting terms and obligations into the ExchangeAgreement.

Amoco also asserts that specific performance is an inappropriate remedy because there are "numerous outstanding issues betweenthe parties, particularly with regard to the requirement inParagraph 21 of the Exchange Agreement that the Premises 'shall bereturned to a mutually agreed upon condition' prior to closing." However, as noted by Bond, the mutually agreed-upon condition (i.e.,the cleanup of the contamination on the property) has beenachieved. The IEPA has issued the NFR letter and the property isready for conveyance. Indeed, the parties agreed to wait for theissuance of the NFR letter before proceeding with the hearing onthe remedy.

Amoco's final argument is that specific performance would leadto an unjust result citing the amount of money spent in theremediation of the Premises and the increase in the Premises' valuefrom 1984 to the present. First, as noted in Bond I, Amoco's"mistake" as to the cost of remediating the Premises is not a basisfor rescinding the contract. There is nothing unconscionable aboutenforcing the Exchange Agreement, as Bond will merely receive whatit contracted for. Second, the purchase price was established bythe parties under the Exchange Agreement. As for the increase inthe value of the Premises, we agree wholeheartedly with Bond andfind that Amoco has no basis to complain about the change in valueof the property because of its refusal for 16 years to convey theproperty to Bond.

III. CONCLUSION

Accordingly, for the reasons stated above, we hereby affirmthe trial court's grant of summary judgment and order of specificperformance in favor of Bond.

Affirmed.

O'Brien and Gallagher, concur.

1. As of the time of the first appeal, Amoco had spent$532,000 to clean up the Premises contamination and surmised thatit could cost as much as an additional $500,000 to complete thejob. As of March 30, 1996, Amoco had spent $1,011,096.53 inremediation costs. The remediation of the Premises was completedon September 21, 1999.

2. Bond points out that Amoco argued the issue of impossi-bility at the hearing on Bond's motion and for many months there-after. Amoco asserted that its performance under the ExchangeAgreement was impossible because it could take in excess of 30years to clean up the contamination.