Nokomis Quarry Co. v. Dietl

Case Date: 08/27/2002
Court: 5th District Appellate
Docket No: 5-01-0740 Rel

Notice

Decision filed 08/27/02. The text of this decision may be changed or corrected prior to the filing of a Petition for Rehearing or the disposition of the same.

NO. 5-01-0740

IN THE

APPELLATE COURT OF ILLINOIS

FIFTH DISTRICT


NOKOMIS QUARRY COMPANY,  ) Appeal from the
) Circuit Court of
              Plaintiff-Appellee, ) Montgomery County.
)
v. ) No. 00-L-33
)
JOSEPH DIETL, ) Honorable
) Mark M. Joy,
             Defendant-Appellant. ) Judge, presiding.

JUSTICE KUEHN delivered the opinion of the court:

Joseph Dietl appeals from the trial court's July 2, 2001, judgment following a benchtrial and from the trial court's August 17, 2001, order denying his motion to reconsider. Hewas ordered to pay Nokomis Quarry Company the sum of $11,501, plus costs. At issue onappeal is whether certain buildings and items were "trade fixtures" that Joseph Dietl couldremove without liability at the expiration of his lease. Joseph Dietl also appeals from the trialcourt's award of compensatory damages.

The background facts of this case sadly remind us that the number of small familyfarms continues to rapidly decrease. Certain land in Montgomery County was owned by theDietl family, having been purchased by Joseph Dietl's father. The son grew up in this farmfamily and took over the farming duties upon his father's 1978 death. On April 28, 1997,Joseph Dietl, as the guardian of the person and estate of his mother, took out a loan securedby the farm. The mortgage was recorded in the Montgomery County circuit court on May6, 1997.

The mortgage document prepared by Boatmen's National Bank of Central Illinoiscontained a security interest provision, by which Joseph Dietl granted to the bank a securityinterest "in all goods now owned or hereafter acquired [that are] intended to be used or areactually used so as to become Fixtures." Additionally, the mortgage defined the premises toinclude "all improvements and fixtures *** now or hereafter existing or constructed upon theland, including but not limited to buildings and other structures."

Joseph Dietl's mother died in October 1998. He was the only heir.

At some point not specified in the record or the briefs, Joseph Dietl defaulted on theloan. On April 22, 1999, NationsBank, N.A., successor in interest to Boatmen's NationalBank of Central Illinois, filed a mortgage foreclosure action against Joseph Dietl. The bankfiled a notice of foreclosure, which was published in an area newspaper beginning on May5, 1999. This notice contained a legal description of the property at issue, which included"all improvements and fixtures *** now or hereafter existing or constructed upon the Land,including but not limited to buildings and other structures." A decree of foreclosure wasentered on October 4, 1999, and the property was set for a sheriff's sale on May 17, 2000.

Prior to that sale, notice of the Montgomery County sheriff's sale was published in an areanewspaper. That notice set forth the legal description of the real estate at issue and furtherindicated that the sale included "all buildings and improvements thereon[] and the tenements,hereditaments[,] and appurtenances thereunto belonging."

Nokomis Quarry Company was the high bidder at the Montgomery County sheriff'ssale. On May 19, 2000, the Montgomery County sheriff conveyed the property to NokomisQuarry Company. This sheriff's deed included the legal description of the farmland, but itdid not specifically reference any fixtures or buildings located on the farmland.

At the conclusion of the May 17, 2000, sale, Joseph Dietl informed Nokomis QuarryCompany that he had a lease (between himself and his now-deceased mother) to farm theland. A copy of this lease is not included in the record. By agreement, the trial court enteredan order on June 13, 2000, modifying the court's award of the possession of the property toNokomis Quarry Company. In this order, the trial court acknowledged that Joseph Dietlentered into a farm lease with his mother on March 1, 1998, and that he could continue tofarm the land until December 31, 2000, at which time he owed Nokomis Quarry Company$8,000 in rent and was required to vacate the premises.

Sometime between May 17, 2000, and December 31, 2000, Joseph Dietl removed thefollowing items from the farm:

(1) Unloading fixtures from the tops of the grain silos

(2) A one-car garage building

(3) An egg-house building

(4) A storage building

(5) Tubular fencing

All of the items removed had been on the farmland for a long period of time.

Nokomis Quarry Company sued Joseph Dietl for damages resulting from the removalof these items. That suit was filed on September 25, 2000. The complaint sought $60,000. The case proceeded to a trial, at which time both sides presented expert witness testimonyon the valuation of these assets. Both sides also presented arguments on the questionwhether the removed items were considered fixtures and were therefore the property ofNokomis Quarry Company or whether the items were trade fixtures of a type that JosephDietl was entitled to remove from the property.

The trial court noted that the mortgage, which was the subject of the foreclosure sale,included all fixtures. The trial court reasoned that the Dietl family intended these items toremain with the real estate and that these items were an integral part of the farm operationas it existed on the date of the foreclosure sale. In conclusion, the trial court found thatJoseph Dietl had no right to remove the property from the farm. In a thorough discussion ofthe issue of damages, the trial judge determined that Nokomis Quarry Company was entitledto damages in the amount of $11,051. Broken down, this award included $10,000 for thereplacement of the unloaders, $1,050 for the gates, and $1 for the buildings.

A case tried without a jury requires the trial judge to weigh all the evidence and makefindings of fact. Hendricks v. Riverway Harbor Service St. Louis, Inc., 314 Ill. App. 3d 800,807, 732 N.E.2d 757, 762 (2000). When a party challenges a trial court's bench-trial ruling,we defer to the trial court's factual findings unless they are contrary to the manifest weightof the evidence. Jackson v. Bowers, 314 Ill. App. 3d 813, 818, 731 N.E.2d 1252, 1257(2000) (citing First Baptist Church of Lombard v. Toll Highway Authority, 301 Ill. App. 3d533, 542, 703 N.E.2d 978, 984 (1998)). A trial court's judgment following a bench trial willbe upheld if there is any evidence supporting it. Hendricks, 314 Ill. App. 3d at 807, 732N.E.2d at 762.

We must first address the issue of whether the items removed were fixtures or tradefixtures.

In Illinois, a fixture is real property that is incorporated into or attached to realty. A& A Market, Inc. v. Pekin Insurance Co., 306 Ill. App. 3d 485, 488, 713 N.E.2d 1199, 1202(1999). A fixture is deemed a part of the real estate and therefore cannot be removed by atenant without incurring liability. Whether something is a fixture rather than a piece ofpersonal property depends upon the nature of its attachment to the real estate, its adaptationto and necessity for the purpose for which the premises are devoted, and whether or not itwas intended that the item should be considered to be a part of the realty. HarrisburgCommunity Unit School District No. 3 v. Steapleton, 195 Ill. App. 3d 1020, 1024, 553 N.E.2d76, 79 (1990). Intent is the critical factor to be considered in determining whether the itemis a fixture or personal property. Harrisburg Community Unit School District No. 3, 195 Ill.App. 3d at 1024, 553 N.E.2d at 79. The intent at issue is the intent to permanently improvereal estate. B. Kreisman & Co. v. First Arlington National Bank of Arlington Heights, 91 Ill.App. 3d 847, 852-53, 415 N.E.2d 1070, 1074-75 (1980).

Items that are attached to realty by a tenant for the purpose of carrying on a trade areconsidered trade fixtures. Empire Building Corp. v. Orput & Associates, Inc., 32 Ill. App.3d 839, 841, 336 N.E.2d 82, 84 (1975) (citing 36A C.J.S. Fixtures