Grady v. Sikorski

Case Date: 06/18/2004
Court: 1st District Appellate
Docket No: 1-03-2397 Rel

SIXTH DIVISION
June 18, 2004



No. 1-03-2397

 
MAUREEN GRADY,

                         Plaintiff-Appellant,

          v.

RICHARD SIKORSKI,

                         Defendant-Appellee.

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Appeal from the
Circuit Court of
Cook County



Honorable
Barbara J. Disko,
Judge Presiding.


JUSTICE GALLAGHER delivered the opinion of the court:

Plaintiff Maureen Grady appeals from the trial court's judgment in favor of defendantRichard Sikorski. Because we find that the Residential Real Property Disclosure Act (765 ILCS77/1 et seq. (West 1998)) (the Act) does not apply to a transaction in which the only structure onthe property is an uninhabitable building, we affirm the judgment for defendant.

In June 2001, the parties entered into a contract under which Grady would purchase fromSikorski property at 2938 North Damen Avenue in Chicago. The lot included a two-storystructure that Grady intended to demolish to make way for construction of a multiple-unitcondominium building. Before signing the contract, Grady toured the existing building withSikorski's real estate agent, Oscar Gaytan of Casa Perez Real Estate Company. Grady testifiedthat the structure had been "totally stripped" of its fixtures. She stated that the building lackedcabinets, toilets, appliances, lighting, a furnace, a water heater and other amenities.

After purchasing the property, Grady had the existing building demolished, and workersprepared to pour the foundation of the new structure. Grady's general contractor ordered a testof the soil and informed Grady that any building erected on the property would require thesupport of caissons. A three-unit condominium building was constructed on the site using pylonsin the foundation. Grady alleged that as a result of the soil condition, she incurred $59,040 inadditional costs, including the foundation reinforcements, soil testing and engineering work, andaccrued interest on her construction loan.

Sikorski testified that when he bought the property in September 1999, he had planned todemolish the structure and develop the lot. In April 2000, Sikorski ordered and received a soiltest report stating that the soil was soft to a depth of 27 feet. Sikorski decided not to build on thelot. In the sale to Grady, Sikorski did not complete a residential real estate disclosure reportpursuant to the Act, which would have required Sikorski to indicate that he was aware of amaterial defect in the stability of the land. Sikorski does not deny his knowledge of the soilcondition, and he testified that he lowered his asking price for the property because of it.

Bernard Kash, Sikorski's attorney, testified that he did not prepare a disclosure report forthe sale to Grady because the lot "was being sold as vacant property" and the structure wasunoccupied. Gaytan testified that he did not prepare a disclosure report because after consultingwith colleagues, he learned that because of the structure's condition, the property sale should betreated as that of a vacant lot, a transaction that would not require such a report.

Grady filed a multiple-count complaint against Sikorski, Gaytan and Casa Perez RealEstate. Grady voluntarily dismissed several counts prior to trial, including all claims againstGaytan and Casa Perez Real Estate. Grady and Sikorski proceeded to a bench trial on count I ofGrady's complaint, in which she alleged that Sikorski violated the Act because he did not discloseknown material defects in the property. In a written order, the trial court entered judgment forSikorski, finding that the Act applied to the transaction but that Sikorski did not knowinglyviolate the statute because he provided Gaytan with a copy of the soil test report.

On appeal, Grady contends that the Act applied to her purchase of 2938 North DamenAvenue and that under the statute, Sikorski was required to provide her with a residential realestate disclosure form. Sikorski responds that although the trial court found that the Act appliedto the sale, the transaction involved uninhabited property being sold as vacant land and thereforewas not subject to the Act's provisions.

Therefore, the scope of the Act is at issue. The construction of a statute is a question oflaw, which we review de novo. Quad Cities Open, Inc. v. City of Silvis, 208 Ill. 2d 498, 508, 804N.E.2d 499, 505 (2004). In attempting to divine a statute's meaning, the intent of the legislatureis best ascertained by examining the language of the statute itself, and where the language is clearand unambiguous, there is no need to resort to other aids of statutory construction, and courtsmust give effect to the statute as written, without applying exceptions, limitations or conditionsthat the legislature did not express. In re Andrea F., 208 Ill. 2d 148, 159-60, 802 N.E.2d 782,789 (2003).

Section 5 of the Act defines "residential real property" as "real property improved withnot less than one nor more than 4 residential dwelling units." 765 ILCS 77/5 (West 1998). Grady argues that the Act applies to her purchase of the lot because a house had been built on theproperty; thus, the land fit the description of "residential real property." While Gradyacknowledges that the structure was stripped of its fixtures at the time of the sale, she contendsthat the "character of the property remained residential." Grady asserts that the Act does not limitthe definition of "residential real property" to property that has been improved with a habitableliving space.

That reading is contrary to the Act's definition of "residential real property," described asproperty improved with between one and four "residential dwelling units." In the context of otherstatutes, this court has found "dwelling unit" to reflect the current or intended future use of aspace as a residence.(1) Here, Grady does not dispute that the structure on the property was nothabitable and would not be made liveable in the future.

Our research has failed to unearth any cases that address whether the Act applies to thesale of property that includes an uninhabitable building. This lack of precedent is logical, giventhat the Act expressly states that its provisions apply to residential real property and also definesthat term. While no court has addressed the Act's definition of "residential real property," it isnoteworthy that each case already decided under the Act has involved the sale of a home orcondominium that the buyers intend to use as a residence or rent to another party as livingquarters. Allstate Insurance Co. v. Lane, 345 Ill. App. 3d 547, 803 N.E.2d 102 (2003); CNAInsurance Co. v. DiPaulo, 342 Ill. App. 3d 440, 794 N.E.2d 965 (2003); Penn v. Gerig, 334 Ill.App. 3d 345, 778 N.E.2d 325 (2002); Hogan v. Adams, 333 Ill. App. 3d 141, 775 N.E.2d 217(2002); Coughlin v. Gustafson, 332 Ill. App. 3d 406, 772 N.E.2d 864 (2002); Rolando v. Pence,331 Ill. App. 3d 40, 769 N.E.2d 1108 (2002); Curtis Investment Firm, Ltd. Partnership v.Schuch, 321 Ill. App. 3d 197, 746 N.E.2d 1233 (2001); Denault v. Cote, 319 Ill. App. 3d 886,746 N.E.2d 765 (2001); Provenzale v. Forister, 318 Ill. App. 3d 869, 743 N.E.2d 676 (2001);King v. Ashbrook, 313 Ill. App. 3d 1040, 732 N.E.2d 621 (2000); Miller v. Bizzell, 311 Ill. App.3d 971, 726 N.E.2d 175 (2000); Carrera v. Smith, 305 Ill. App. 3d 1079, 713 N.E.2d 1282(1999); Woods v. Pence, 303 Ill. App. 3d 573, 708 N.E.2d 563 (1999); Hirsch v. Feuer, 299 Ill.App. 3d 1076, 702 N.E.2d 265 (1998); Washington Courte Condominium Ass'n-Four v.Washington Golf-Corp., 267 Ill. App. 3d 790, 643 N.E.2d 199 (1994). Furthermore, althoughthe Act is not ambiguous, and this court therefore is not compelled to use methods of statutoryconstruction to ascertain its meaning, the Act's legislative history is illustrative. Discussing HouseBill 358, which became Public Act 90-383 and made several amendments to the Act effectiveJanuary 1, 1998, a legislator noted that the Act applied to sales of property in Illinois, "specificallyhomes." 90th Ill. Gen. Assem., House Proceedings, May 20, 1997, at 5-6 (statements ofRepresentative Novak).

We agree with Grady that the purpose of the Act is to provide prospective buyers ofresidential property with information regarding the property's condition. However, we do notfind that fact furthers Grady's theory. Grady did not seek information about the condition of theonce-residential structure that stood on the property; rather, her lawsuit involves a condition ofthe land itself.

Moreover, Grady's inclusive characterization of the term "residential real property" wouldextend the Act beyond its intended reach and render the statute meaningless by applying itsprovisions to the sale of any property that includes a building that once served as a residence. TheAct requires the seller of "residential real property" to complete and deliver to the prospectivebuyer a disclosure form indicating the seller's knowledge of material defects in the property, suchas basement flooding, foundational cracks, plumbing or electrical problems, unsafe concentrationsof radon, asbestos or other chemicals, infestations of termites or other insects, and otherconditions listed in section 35 of the Act. 765 ILCS 77/20, 77/35 (West 1998). If, as in theinstant case, the buyer of the property intends to destroy the structure, the Act's disclosurerequirements serve no useful purpose.

Although the trial court found that the Act applied but ruled that Sikorski did not violatethe statute, this court can affirm the trial court's judgment on any basis in the record. InlandLand Appreciation Fund, L.P. v. County of Kane, 344 Ill. App. 3d 720, 726, 800 N.E.2d 1232,1237 (2003). The Act does not require that a residential real estate disclosure form be completedfor the sale of property that includes an uninhabitable structure. Because 2938 North DamenAvenue did not constitute "residential real property" as defined in the Act, the statute did notapply to the transaction between Grady and Sikorski. Accordingly, the judgment for Sikorski isaffirmed. Given that conclusion, we need not consider Grady's remaining assertions.

Affirmed.

O'MARA FROSSARD, P.J., and FITZGERALD SMITH, J., concur.



1. See, e.g., Meyer v. Cohen, 260 Ill. App. 3d 351, 358, 632 N.E.2d 22, 27 (1993)(interpreting "dwelling unit" under Chicago landlord and tenant ordinance as "part of a structurewhich can be used as a home, residence or sleeping place, regardless of whether it is beingemployed as such" (emphasis in original)). See generally People v. Silva, 256 Ill. App. 3d 414,420-21, 628 N.E.2d 948, 952-53 (1993) (finding that unoccupied basement and first-floorapartments undergoing renovation and used for storage fit definition of "dwelling" underresidential burglary statute); People v. Smith, 209 Ill. App. 3d 1091, 1096, 568 N.E.2d 417, 420(1991) (finding that vacation home is "dwelling" under residential burglary statute; key inquiry indefining "dwelling" is "the intent of the owner to reside in the building within a reasonable periodof time after his absence").