Edson v. Horwich , 2024 IL App (1st) 221877-U ( 2024 )

2024 IL App (1st) 221877-USIXTH DIVISION
March 8, 2024
No. 1-22-1877
NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the
limited circumstances allowed under Rule 23(e)(1).
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
FIRST DISTRICT
______________________________________________________________________________
TOM EDSON AND CHESTNUT INVESTMENT 1, LLC, ) Appeal from the Circuit Court
) of Cook County.
Plaintiffs-Appellants, )
)
)
v. ) No. 19 L 12785
)
DAVID HORWICH AND HOMESERVICES OF )
ILLINOIS, LLC D/B/A BERKSHIRE HATHAWAY )
HOME SERVICES KOENIG RUBLOFF REALTY )
GROUP, F/K/A PRUDENTIAL RUBLOFF, LLC, ) Honorable
) Michael F. Otto,
Defendants-Appellees. ) Judge, presiding.
JUSTICE C.A. WALKER delivered the judgment of the court.
Justices Hyman and Tailor concurred in the judgment.
ORDER
¶1 Held: The circuit court erred by refusing to answer the jury’s questions regarding the
Plaintiffs’ fraud claims and by finding in favor of Defendants on Plaintiffs’ Real
Estate License Act claim. We remand for a new trial on those claims only.
No. 1-22-1877
¶2 Following a joint jury and bench trial on multiple claims arising from a real estate
transaction, the jury found in favor of Defendants David Horwich and HomeServices of Illinois
(HomeServices) (hereinafter collectively “Defendants”) against the Plaintiffs Tom Edson and
Chestnut Investment 1, LLC (Chestnut) (hereinafter collectively “Plaintiffs”) on claims of fraud,
but in favor of Plaintiffs and against Defendants on claims of negligent misrepresentation. The
circuit court then ruled in favor of Defendants on the bench trial counts for alleged violations of
the Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1 et seq. (West 2010))
(Consumer Fraud Act) and Real Estate License Act of 2000 (225 ILCS 454/1-1 et seq. (West
2010)) (License Act). On appeal, Plaintiffs argue the circuit court erred by: (1) directing verdict
against a particular element of damages; (2) refusing to include that element of damages in the
jury instructions; (3) refusing to give a jury instruction regarding statutory violations as a theory
of negligence; (4) finding in favor of Defendants on the Consumer Fraud Act claim; (5) refusing
to answer two jury questions regarding the fraud claims; and (6) finding in favor of Defendants on
the License Act claim. For the reasons below, we affirm in part, vacate in part, and remand in part
for a new trial on the fraud and License Act claims only.
¶3 BACKGROUND
¶4 Plaintiffs filed their complaint on October 14, 2014. Therein, they alleged that in November
2012, Edson sought to purchase an investment property in Chicago. He toured a unit in a building
on the 200 block of East Chestnut Street (the “Property”) after he reviewed promotional materials
created by Horwich, a licensed real estate broker employed by HomeServices (then known as
Prudential Rubloff). The materials described the Property as a former grocery store that was a
“Perfect Location for Commissary, Fitness Center, Medical Office, Restaurant/Bar,” and later
reiterated the Property was “Perfect for Grocery, Medical Clinic, Fitness Center, Restaurant/Bar,
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Office.” The materials listed “Retail” as the “Property type.” During a tour of the Property,
“Horwich told Edson and his father that the [Property] was perfect for a grocery store or other
commercial uses,” and leftover grocery store equipment visibly remained in the space.
¶5 Allegedly in reliance on these representations, Edson sought a tenant for the Property. A
potential tenant, Jerry Bockwinkel, owner of Bockwinkel’s grocery stores, later toured the
Property with Horwich and Edson, at which time Horwich allegedly stated the Property could be
used as a grocery store and “would be a perfect location due to an absence of a local grocery store
in the general area.” Edson ultimately agreed to purchase the Property for $600,000 from owners
LINVIC, LLC (LINVIC). Attorneys from Fogarty & Fugate, LLP, represented Edson in
connection with the transaction.
¶6 The complaint continued that Bockwinkel eventually declined to lease the Property, and
during negotiations with another prospective tenant, their broker informed Edson that the Property
was not zoned for commercial use because it was “zoned DR,” a residential designation. The
Chicago Zoning Board confirmed this. Plaintiffs alleged that Edson failed in an attempt to re-zone
the Property, and the zoning “substantially diminished” the Property’s value.
¶7 The complaint listed multiple theories for liability, including, in relevant part, (1) count I
for fraud against Horwich; (2) count II for fraud against HomeServices; (3) count III for negligent
misrepresentation against Horwich; (4) count IV for negligent misrepresentation against
HomeServices; (5) count VIII for violation of the Consumer Fraud Act against Horwich; and (6)
count IX for violation of the Consumer Fraud Act against HomeServices. Plaintiffs also raised
claims against their attorneys (Attorney Defendants). Plaintiffs later amended their complaint to
add Count X against Defendants for violation of the License Act.
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¶8 Following discovery, Defendants moved for summary judgment on all counts, which the
circuit court granted. This court reversed the circuit court’s ruling and remanded for further
proceedings. Edson v. Fogarty, 2019 IL App (1st) 181135 (Edson I). During the pendency of that
appeal, Plaintiffs and the Attorney Defendants completed a jury trial, after which the jury ruled for
the Attorney Defendants.
¶9 Following remand, the claims against Horwich and HomeServices went to trial, which
began in June 2022. Horwich represented himself. Before trial, the circuit court entered an order
on the parties’ motions in limine, in which the court, in relevant part, granted HomeServices’
Motion in Limine No. 8, and ordered, “No party shall introduce at trial any evidence of the fair
market value of the Property at the time of its conveyance back to the [condominium association]
(Association) by the Plaintiffs.”
¶ 10 During a jury instruction conference, defense counsel objected to the $600,000 purchase
price as an element of damages. Counsel for HomeServices noted, [T]here’s an order in limine
barring the parties from introducing any evidence or testimony regarding the value of the
[Property] when it was relinquished to the [Association].” The circuit court asked if the motion in
limine was granted “[b]ecause there was no evidence developed?” to which another attorney for
HomeServices responded, “Right.” Plaintiffs’ counsel argued it was not their “burden” to
demonstrate the Property had some value, to which the court replied, “Well, [a plaintiff has] the
burden of proving damages,” and continued that the fact that Plaintiffs “might not have bought the
[Property] but for the alleged negligent misrepresentations doesn’t necessarily mean that you are
damaged in the amount of the purchase price.” Defense counsel argued that while Plaintiffs
claimed the Property “had no value,” there was no witness “to testify that it has no value,” and
furthermore, “[t]his isn’t a rescission case where I’m getting the property back. It’s gone.” The
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court stated, “I agree with the defendants. The purchase price is not a measure of damages because
it does not take into account what the actual value of the asset purchased was.” The court sustained
the objection and refused to allow the purchase price of $600,000 as an element of damages.
¶ 11 Plaintiffs also submitted two proposed instructions that would instruct the jury that “if they
find that a statute (Plaintiffs offered separate instructions for both the Consumer Fraud Act and the
License Act) was violated, that is one factor they may take into account in determining whether
there was negligence.” Plaintiffs’ counsel acknowledged the claims alleging violations of those
acts would be resolved by the court, not the jury. Defense counsel argued that it would be
prejudicial “if the jury gets involved” in the statutory claims. The court refused to give either
instruction, describing the instructions as an attempt at “bootstrapping.”
¶ 12 At trial, Horwich testified that he is a licensed realtor, and was working in that capacity for
HomeServices in 2012 when he received a listing for the Property which was on the lower level
of a high-rise condominium building. The Property had formerly housed a grocery store, the “Stop
& Shop.” The building also contained a restaurant and dry cleaner. Horwich admitted telling
prospective buyers of the Property, including Edson, that the space was “perfect for a grocery
store.” Promotional materials for the Property contained similar language. Edson contacted
Horwich regarding the listing in the fall of 2012, and the two then toured the Property in December
2012. During the tour, Horwich told Edson the Property had been a grocery store and showed
Edson equipment that remained in the space.
¶ 13 Horwich admitted he wrote the Property was zoned B1-3 in the promotional materials. He
consulted a zoning map before he included this information in the materials, which did not list the
Property as zoned B1-3. Instead, the map indicated the building was zoned for residential use. A
previous broker listed the Property as zoned B1. Horwich added the “-3” because in his experience,
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zoning codes generally also have a dash. He did not take any steps to ensure the Property’s zoning
permitted a grocery before he entered the language regarding grocery stores on the promotional
materials.
¶ 14 After the first tour, Edson subsequently toured the Property with Bockwinkel before
offering $600,000 for the Property, which Horwich’s client, LINVIC, accepted. Horwich earned
commission from the sale.
¶ 15 On cross-examination by counsel for HomeServices, Horwich testified that the promotional
materials contained a disclaimer which Horwich believed to mean that any prospective buyer of
the Property “should do your due diligence and not rely on the document.” Another broker, Marina
Lee Ma, had the Property listing before Horwich, and Horwich “cloned” (i.e. copied) the B1 zoning
information from Ma’s promotional material. Horwich updated some information, including
“things about current use being commercial,” and changed the zoning from B1 to B1-3. Horwich
did not recall exactly why he made this change, and ultimately stated, “I had mentioned earlier that
I picked up the B1 from the previous broker. I looked at it and decided I was going to expound on
that due to the fact that B1 typically refers to a small retail outlet, and then as you have the dash
numbers increasing, they apply to the larger commercial units.” He did not learn the zoning
designation was inaccurate before the sale closed.
¶ 16 Edson testified that he first noticed the Property in 2012 on LoopNet, a real estate website.
He contacted Horwich about the Property in November 2012. During the initial phone call,
Horwich informed Edson the Property had been a grocery store and would be a “great space” for
a grocery store. Edson visited the Property with Horwich, who provided Edson with the
promotional materials during the visit. During this visit, Horwich stated to Edson that the Property
was zoned “B1-3” and “would be perfect for a grocery store.” The statements were consistent with
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No. 1-22-1877
the information in the promotional materials. The zoning designation was important to Edson
because he believed “1-3” meant the Property had many potential uses which would allow him to
market it for rental to a “multitude of potential tenant classes.” Edson did not personally verify the
zoning because he believed his attorney would perform this task, and also because he “had no
reason to doubt” Horwich. Edson testified that he “relied on [the zoning] information to make [his]
decision to purchase the property.” After Edson contracted to buy the Property, but before the
closing, a meeting involving Edson, Horwich, and Bockwinkel occurred, at which time Horwich
told Bockwinkel the zoning was “B1-3” and the Property “would be a spectacular location for a
grocery store.” Closing occurred on January 31, 2013. Attorney Kelli Fogarty represented Edson
during the purchase and helped him form Chestnut to “take ownership of the [P]roperty at closing.”
¶ 17 In January 2014, Edson learned that the Property “was not zoned for business uses” through
his broker, who had learned the information from a broker for another prospective tenant. Edson
hired the law firm of Schain Banks, and subsequently attorney Thomas Ramsdell, to assist in re-
zoning the Property. Beyond hiring attorneys, Edson also personally attempted to convince the
Association “to support a zoning change and petition the alderman to change the zoning of the
property.” No zoning change occurred, and eventually Chestnut ran out of money, forcing an
agreement with the Association for the transfer of the Property.
¶ 18 Edson stated that he would not have purchased the Property had he known he could not
receive a rental income from it. Moreover, had he learned of the actual zoning during the time
between when LINVIC accepted his offer and the transaction closed, he would have canceled the
contract.
¶ 19 On cross-examination by counsel for HomeServices, Edson testified that Fogarty was
responsible for due diligence, but did not check the Property’s zoning before closing, which Edson
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only learned after closing. Another broker assisted Edson with the purchase, who also failed to
perform due diligence regarding zoning. On cross-examination by Horwich, Edson testified he
was “eager” to close on the Property so he could lease it out.
¶ 20 Patricia Santos testified that she works for Sudler, a company that managed the building in
which the Property was located. She was involved in the building’s management in late 2012. She
met with Edson before he purchased the Property. Santos learned of the zoning issue through
Edson. At some point following the sale, Chestnut stopped paying assessments to the Association,
leading it to initiate foreclosure proceedings. The foreclosure litigation concluded in 2016 with
Chestnut transferring the Property to the Association in exchange for forgiveness of the
outstanding assessments and a payment of approximately $4000 for architectural drawings.
¶ 21 Plaintiffs entered portions of the deposition of Thomas Ramsdell, deceased, into evidence.
Ramsdell testified that he represented Edson in relation to the Property as a zoning attorney. His
efforts focused on zoning changes so Plaintiffs could “put some sort of viable commercial business
use” to the Property. His understanding was if there was not a “zoning change, no tenant was going
to talk to you.”
¶ 22 John Christian Ficara also testified via deposition that he interacted with Edson and
Ramsdell regarding the Property’s zoning in his capacity as director of public affairs for Alderman
Brian Hopkins. Ficara stated that “a zoning change in an existing condominium building like [this
one] in a downtown district is very unlikely and frankly not common to our office.” Following a
tenant survey suggesting the tenants of the building supported opening a grocery store, Hopkins’
office agreed to support a zoning change if a “grocer or convenience store tenant was secured.”
Ficara provided a letter with Hopkins’ signature to Edson and Ramsdell confirming this position.
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¶ 23 Plaintiffs rested, and HomeServices moved for a directed verdict on the fraud and negligent
misrepresentation counts while Horwich was absent from court. In relevant part, counsel for
HomeServices argued there was no indication of the value of the Property at the time Chestnut
transferred it to the Association, and thus the purchase price element of damages “should not go
to the jury because there was no proof whatsoever as to what that loss is.” The circuit court denied
the motion as to “liability,” but granted it as to the purchase price as an element of damages. The
court explained “there was no evidence presented in the plaintiffs’ case of what the actual value of
the unit was with the appropriate zoning. The jury would be required to speculate.” The court made
identical rulings on HomeServices’ subsequent motions for directed verdicts on the Consumer
Fraud Act and License Act claims. The court permitted Horwich to adopt HomeServices’ directed
verdict motions when he returned to court.
¶ 24 HomeServices recalled Santos, who testified that she did not know the Property’s zoning
before the 2014 inquiry.
¶ 25 HomeServices also recalled Edson, who testified that he did not recall seeing promotional
materials for the Property prepared by Marina Lee Ma, but agreed the promotional materials
authored by Ma contained the “B1” zoning designation when counsel for HomeServices showed
Edson the materials.
¶ 26 After closing arguments, the circuit court instructed the jury, in relevant part, that it could
award damages based on “the amount of money the Plaintiffs reasonably expended because of the
defendants’ misrepresentations,” and “the amount of money the Plaintiffs reasonably expended in
the exercise of ordinary care to minimize existing damages and to prevent further damage.”
¶ 27 The court further instructed the jury regarding counts I and II for fraud as follows:
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No. 1-22-1877
“[T]he plaintiffs claim that the defendants made the following statements: That the
property in question was zoned ‘B1-3’; That the property was perfect for Grocery, Medical
Clinic, Fitness Center, Restaurant/Bar, Office; That the property could be used as a grocery
store, a restaurant, bar, fitness center, medical office, office space, or retail. Plaintiffs further
claim that the statements were false statements of material facts.”
The court continued:
“As to the plaintiffs’ claims for fraud in Counts 1 and 2, the plaintiffs have the
burden of proving each of the following propositions by clear and convincing evidence:
First, the defendant made a false statement of material fact. Second, the defendant knew the
statement was false or the defendant made the statement in reckless disregard [of] whether
it was true or false. Plaintiffs have the burden of proving that each of the following
propositions is more probably true than not true: Third, the defendant made the statement
with the intent to induce the plaintiff to purchase the property. Fourth, the plaintiff
reasonably believed the statement and purchased the property in justifiable reliance on the
truth of the statement. Fifth, the plaintiffs’ damages resulted from the reliance.”
¶ 28 During its deliberations, the jury asked a question of the circuit court, which read, “For
Counts 1 and 2 of fraud, do we need to find all five propositions true for: statements wise, A, all
three together? Or B, only one of three?” The court stated its “inclination is just to say, ‘You have
your instructions,’ unless anybody disagrees.” Counsel for HomeServices agreed with the court,
and contended it was not “appropriate” to answer the question substantively. Plaintiffs’ counsel
responded, “I think there is a right answer for their question,” and continued, “I am asking that
[the court] answer the question that they may find in favor of the [Plaintiffs] if the five propositions
in the instructions have been proved as to any of the alleged misrepresentations.” Both Horwich
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and HomeServices objected to Plaintiffs’ request, and the court ultimately only responded to the
jury: “[Y]ou have your instructions. Please keep deliberating.”
¶ 29 Shortly thereafter, the jury asked another question, which read:
“Note: Do all three statements:
• B1-3;
• Property perfect for;
• Property could be used,
need to be true for each proposition?
Question: If one statement is false, does that [make] the entire proposition false?” (Emphasis
in original).
The circuit court stated, “The answer *** is that the instructions just say plaintiffs have to prove
that the defendant made a false statement of material fact. The instructions do provide that the
plaintiffs claim that defendants made three separate false statements of material fact,” but again
only responded, “Please refer to your instructions and continue to deliberate.”
¶ 30 The jury found in favor of Horwich and HomeServices and against Plaintiffs on the fraud
counts, but for Plaintiffs and against Horwich and HomeServices on the negligent
misrepresentation counts, awarding Edson $0 and Chestnut $41,000 on both counts.
¶ 31 After discharging the jury, the circuit court made its rulings on the bench trial counts for
violations of the Consumer Fraud Act and License Act. The court ruled in favor of Horwich and
HomeServices on the Consumer Fraud Act claims, explaining, “I do not believe that Mr. Horwich
intentionally deceived Mr. Edson.” Regarding the License Act, the court ruled in favor of
Defendants. In so finding, the court stated, “one of the questions is whether the false information
came from the seller. Again, Mr. Horwich testified, and I thought credibly, that he relied on the
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No. 1-22-1877
prior listing sheet.” The court continued that the B1 zoning description “came from the seller ***
through the prior listing.” Plaintiffs’ counsel responded, “the evidence was clear that the seller was
[LINVIC], and there was no evidence that any information came from that seller, and I don’t think
the evidence supported an inference based on nothing that the information in the Marina [Lee Ma]
listing had come from that seller. The court responded, “I understand the point, and you are right.
There was no direct testimony that the information on the prior listing sheet came from the seller,
but I conclude that that is a reasonable inference from the testimony and facts and the evidence.”
¶ 32 On June 30, 2022, the circuit court entered judgment as follows: (1) in favor of Horwich on
Count I for fraud; (2) in favor of HomeServices on Count II for fraud; (3) in favor of Plaintiffs
against Horwich on Count III for negligent misrepresentation, with $41,000 in damages to
Chestnut; (4) in favor of Plaintiffs and against HomeServices for negligent misrepresentation, with
$41,000 in damages to Chestnut; (5) in favor of Horwich on the Consumer Fraud Act claim; (6) in
favor of HomeServices on the Consumer Fraud Act claim; (7) in favor of Defendants on the
License Act claim.
¶ 33 Plaintiffs filed a posttrial motion, arguing in relevant part that the circuit court erred by (1)
directing a finding on the purchase price element of damages; (2) not instructing the jury on the
purchase price element of damages; (3) refusing to give certain other jury instructions, including
those regarding the statutory theories of negligence deriving from the Consumer Fraud Act and
License Act; (4) ruling for Defendants on the Consumer Fraud Act claims; (5) not responding
substantively to the jury’s questions; and (6) ruling for Defendants on the License Act claim. The
court denied the motion in all relevant parts. This appeal followed.
¶ 34 JURISDICTION
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¶ 35 The circuit court denied Plaintiffs’ posttrial motion on November 9, 2022, and Plaintiffs
filed their notice of appeal on December 12, 2022, after which this court granted their motion to
file a late notice of appeal pursuant to Illinois Supreme Court Rule 303(d) (eff. July 1, 2017).
Accordingly, this court has jurisdiction pursuant to Rule 303. Ill. S. Ct. R. 303 (eff. July 1, 2017).
¶ 36 ANALYSIS
¶ 37 Plaintiffs raise six claims on appeal. The first two center around the circuit court’s decisions
to bar Plaintiffs from pursuing the $600,000 purchase price as damages by (1) directing a verdict
against that element of damages, and then (2) refusing to instruct the jury that the purchase price
could be an element of damages. Plaintiffs further claim the court erred by (3) refusing to give
Plaintiffs’ proposed jury instruction on the statutory violation theories of negligence, (4) finding
in favor of Horwich and HomeServices on the Consumer Fraud Act counts, (5) refusing to
substantively answer the jury’s questions regarding the fraud counts, and (6) finding in favor of
Defendants on the License Act claim.
¶ 38 We first address the claims regarding the purchase price element of damages. Plaintiffs
sought this element of damages in connection with all claims at trial—the two fraud counts, the
two negligent misrepresentation counts, the Consumer Fraud Act counts, and the License Act
count, and the circuit court ruled Plaintiffs could not recover this element of damages under any
count.
¶ 39 A plaintiff bears the burden of proving their damages. Razor v. Hyundai Motor America,
222 Ill. 2d 75, 106-07 (2006); 1472 N. Milwaukee, Ltd. v. Feinerman, 2013 IL App (1st) 121191,
¶ 31. To meet this burden, a plaintiff must introduce sufficient evidence such that the factfinder
can make a reasonable calculation of damages, though this need not be an exact figure. Doornbos
Heating and Air Conditioning, Inc. v. James D. Schlenker, M.D., S.C., 403 Ill. App. 3d 468, 487
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(2010). Plaintiffs’ theory for damages is that it purchased the Property due to misrepresentations
by Horwich about zoning, which caused Plaintiffs to own property that was not of the nature
Plaintiffs anticipated in making the purchase. In this situation, Illinois law maintains that, “The
measure of actual damages, where the purchase of property is induced by fraud, is the difference
between the value of the property as it in fact existed and the value that it would have had had the
seller’s representations been true.” Home Savings and Loan Ass’n of Joliet v. Schneider, 127 Ill.
App. 3d 689, 694-95 (1984), aff’d in part, rev’d in part on other grounds, 108 Ill. 2d 277 (1985)
(citing Four “S” Alliance, Inc. v. American National Bank & Trust Co. of Chicago, 104 Ill. App.
3d 636 (1982)); see also Beaton & Associates, Ltd. v. Joslyn Mfg. & Supply Co., 159 Ill. App. 3d
834, 844 (1987) (“One induced to contract through the fraud of another may elect to rescind the
contract to recover the consideration paid, or affirm the contract and recover the difference
between the property received and what he or she would have received but for the fraud.”).
¶ 40 The circuit court granted Defendants’ motions for a directed verdict on the purchase price
as an element of damages based on a finding that Plaintiffs failed to introduce sufficient evidence
to submit the issue to the jury. A circuit court may direct a verdict as to an element of damages.
Benford v. Everett Commons, LLC, 2014 IL App (1st) 130314, ¶¶ 35-37. A directed verdict is
proper where “there is a total failure or lack of evidence to prove a necessary element of the
plaintiff’s case.” Id. ¶ 28. The decision whether to direct a verdict is reviewed de novo. Id.
¶ 41 The circuit court also refused Plaintiffs’ request to instruct the jury that it could consider the
purchase price as an element of damages, based on its above-referenced evidentiary finding and
corresponding grant of Defendants’ directed verdict motions. Regarding jury instructions, civil
litigants “are entitled to have the jury instructed on the issues presented, the applicable legal
principles, and the facts that must be proved to support a verdict,” but the decision on what
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No. 1-22-1877
instructions to give falls within the circuit court’s discretion, and we review a court’s decision
whether to give a jury instruction for abuse of discretion. See Bailey v. Mercy Hospital and Medical
Center, 2021 IL 126748, ¶ 42.
¶ 42 The record shows that before trial, the circuit court granted a motion in limine preventing
Plaintiffs from introducing any evidence as to the value of the Property at the time it was
transferred to the Association. Subsequently, at trial, there was no evidence on the Property’s value
under its actual residential zoning.
¶ 43 On this record, we agree with the circuit court that Plaintiffs failed to introduce sufficient
evidence to present the purchase price as an element of damages to the jury. As the court noted,
the law is clear that the proper determination of damages in this situation is the value the Property
would have had if zoned for commercial use minus the value it had as actually zoned. Home
Savings, 127 Ill. App. 3d at. 694-95. Plaintiffs provided no evidence for the jury to make a
reasonable calculation as to the second figure. See Doornbos Heating, 403 Ill. App. 3d at 487. The
record suggests Plaintiffs failed to develop this evidence in discovery, and Plaintiffs do not argue
on appeal that the court erred in granting the motion in limine, or that Plaintiffs even had evidence
to enter regarding the value of the Property as zoned residential, should the court have allowed it.
The absence of this evidence is fatal. See Benford, 2014 IL App (1st) 130314, ¶ 35; see also Sheth
v. SAB Tool Supply Co., 2013 IL App (1st) 110156, ¶ 92 (certainty in damages not required, but a
jury cannot base a damage award on speculation, and evidence must provide a reasonable basis for
computing damages). It follows that the court did not err in granting a directed verdict on the
purchase price as an element of damages, and, of course, did not then abuse its discretion in
refusing a jury instruction that listed the purchase price as a viable element of damages.
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¶ 44 Plaintiffs maintain the record sufficed to show Edson would not have purchased the Property
but for Horwich’s statements, and this is enough to present the purchase price as an element of
damages to the jury. This argument fails because while it is generally correct that a defendant,
found liable for negligent misrepresentation or fraud, is liable for the damages the plaintiff suffered
for actions taken in reliance on the negligent or fraudulent conduct, Illinois law requires in this
specific circumstance that a plaintiff introduce enough evidence that the factfinder can make a
reasonable calculation of the difference between the value the property would have had if it was
as plaintiff believed, and the property’s actual value given the actual facts of the situation—here,
the Property’s value if zoned for commercial use minus its value as zoned residential. Home
Savings, 127 Ill. App. 3d at 694-95. Plaintiffs cite Nelson Brothers Professional Real Estate, LLC
v. Freeborn & Peters, LLP, 773 F.3d 853, 859 (7th Cir. 2014) and Board of Trustees of Community
College District No. 508 v. Coopers & Lybrand, 208 Ill. 2d 259, 263 (2003) in support, but neither
case aids their position. Nelson Brothers emphasizes Plaintiffs’ failure, as the court there
explained:
“The plaintiffs’ loss was the difference between their expenditures in trying to
obtain a substantial interest in the shopping center and what they obtained for those
expenditures—namely, that interest. If that interest were worth anything, awarding the
plaintiffs as damages all their expenditures would overcompensate them. But their
contention, which the jury appears to have accepted, is that the interest they acquired was
worthless.” Nelson Brothers, 773 F.3d at 856.
The difference here is that Plaintiffs failed to establish the Property’s value, worthless or otherwise,
unlike the plaintiffs in Nelson, who established the property they acquired was worthless. Board
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of Trustees, meanwhile, centered on the purchase of securities, and contains no guidance on
calculating damages in our context. Board of Trustees, 208 Ill. 2d at 262-66.1
¶ 45 Plaintiff argues there was sufficient information from which the jury could have concluded
the value of the Property was zero, but the record belies this argument. Plaintiff offered no evidence
about the Property’s value as zoned residential, $0 or otherwise. That Edson had difficulty finding
a commercial tenant is not competent evidence the Property was literally worthless, as damages
must be based on measurable elements, not speculation or conjecture. Sheth, 2013 IL App (1st)
110156, ¶ 92. It was incumbent upon Plaintiffs to submit competent evidence of the value of the
Property under its residential zoning. No such evidence is in the record, and thus Plaintiffs failed
to meet their burden, and the circuit court’s decisions in accordance were proper.
¶ 46 Plaintiffs further argue that this court in Edson I validated their theories of damages, which
should have bound the circuit court on the issue as the “law of the case.” See Krautsack v.
Anderson, 223 Ill. 2d 541, 552 (2006) (“Generally, the law of the case doctrine bars relitigation of
an issue previously decided in the same case.”). This is an inaccurate representation of Edson I;
there, another panel of this court resolved summary judgment issues only and made no binding
declarations regarding what damages the evidence at trial would or would not support. Edson I,
2019 IL App (1st) 181135, ¶¶ 39, 44, 47; see also Pepper Construction Co. v. Palmolive Tower
Condominiums, LLC, 2021 IL App (1st) 200753, ¶ 69 (“The law of the case doctrine does not
apply where different issues are involved.”).
¶ 47 Finally, Plaintiffs argue that Defendants could have called a property appraiser to testify if
they intended to argue the purchase price was not a proper element of damages. This argument
1
Plaintiffs’ citation to Metrick v. Chatz, 266 Ill. App. 3d 649 (1994), similarly fails because
the court there does not discuss damage calculation in this context.
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fails because it improperly shifts the burden of proving damages from plaintiff to defendant. See
Razor, 222 Ill. 2d at 106-07. Illinois law maintains that it is a plaintiff’s burden, not a defendant’s,
to establish its damages, and this meant Plaintiffs had to introduce evidence permitting the jury to
make a reasonable calculation of the value of the Property as zoned residential. Id. Plaintiffs
supplied no such evidence, and it was certainly not Horwich’s or HomeServices’ obligation to
correct Plaintiffs’ failure.2
¶ 48 Plaintiffs next claim that the circuit court erred regarding the negligent misrepresentation
jury instructions because it refused to instruct the jury that if it found Horwich or HomeServices
violated the statutory obligations imposed by the Consumer Fraud Act or License Act, the jury
could consider that violation in determining negligence.
¶ 49 In certain circumstances, a jury may consider whether a defendant violated a statute in
determining whether that defendant acted negligently. See Illinois Pattern Jury Instructions, Civil,
No. 60.01 (revised Dec. 2011). As mentioned above, a circuit court’s decision whether or not to
provide a particular jury instruction is reviewed for abuse of discretion. Bailey, 2021 IL 126748,
¶ 42. A reviewing court should not reverse a verdict based on an erroneous jury instruction unless
that error caused “serious prejudice.” Id. (citing Heastie v. Roberts, 226 Ill. 2d 515, 543 (2007)).
¶ 50 We find that Plaintiffs’ claim regarding the negligent misrepresentation jury instructions
fails because, even assuming the circuit court erred by refusing the instructions, Plaintiffs suffered
no prejudice because the jury ruled in their favor on the negligent misrepresentation claims. Id. In
2
Plaintiffs briefly argue that the court should not have permitted Horwich to adopt
HomeServices’ directed verdict motion, but provide no legal basis for this contention. This
argument therefore fails because it is a party’s burden to provide legal support for their argument.
See First Mercury Insurance Co. v. Nationwide Security Services, Inc., 2016 IL App (1st) 143924,
¶ 21.
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their brief, Plaintiffs acknowledge this, but contend that if this court remands for a new trial that
includes their counts for negligent misrepresentation, the circuit court at the new trial should
instruct the jury on the statutory violation theories of negligence. Based on the above, however,
Plaintiffs are not entitled to a new trial on the negligent misrepresentation claims, as their only
argument regarding those claims stemmed from the purchase price issue.
¶ 51 Plaintiff next claims the circuit court erred in finding for Defendants on the Consumer Fraud
Act claims. To establish a claim under the Consumer Fraud Act, a plaintiff must show, “ ‘(1) a
deceptive act or practice by the defendant, (2) the defendant’s intent that the plaintiff rely on the
deception, (3) the occurrence of the deception in the course of conduct involving trade or
commerce, and (4) actual damage to the plaintiff (5) proximately caused by the deception.’ ” Edson
I, 2019 IL App (1st) 181135, ¶ 20 (quoting Oliveira v. Amoco Oil Co., 201 Ill. 2d 134, 149 (2002)).
A circuit court’s ruling on a Consumer Fraud Act claim is reviewed under the manifest weight of
the evidence standard. Pack v. Maslikiewicz, 2019 IL App (1st) 182447, ¶ 113. “A decision is
against the manifest weight of the evidence only when an opposite conclusion is apparent or when
the findings appear to be unreasonable, arbitrary, or not based on the evidence.” Eychaner v. Gross,
202 Ill. 2d 228, 252 (2002). The reviewing court will not substitute its judgment for that of the
trier of fact. Id.¶ 52 We find the circuit court’s decision that Plaintiffs did not establish each element of their
Consumer Fraud Act claim was not against the manifest weight of the evidence. The court found
Horwich did not intend Edson to rely on his statements, and thus Plaintiffs failed to establish the
second element. See Edson I, 2019 IL App (1st) 181135, ¶ 20. A reasonable factfinder could have
reached the same result if it credited Horwich’s testimony that he intended Edson to perform due
diligence and rely on his attorney’s advice before purchasing the Property. The court here credited
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this testimony, which was also supported by the disclaimer in the promotional materials. The
record could also support the opposite conclusion, based on the promotional materials and Edson’s
testimony regarding Horwich’s statements, should a factfinder credit Edson’s account over
Horwich’s. In this situation, where the accounts of Edson and Horwich are in direct conflict and
both have support in the record, we cannot reverse under a manifest weight of the evidence
standard, as it is improper for this court to substitute its judgment for that of the circuit court on
credibility and evidentiary weight. See Eychaner, 202 Ill. 2d at 251-52. Accordingly, we cannot
disturb the court’s decision on the Consumer Fraud Act claims and must affirm.
¶ 53 Plaintiffs next claim the circuit court erred by refusing to substantively answer the jury’s
questions regarding the fraud instructions. In Illinois, when a jury asks the circuit court a question
demonstrating confusion over a relevant legal issue, the court generally has a duty to “instruct the
jury further or clarify the point of law that has caused doubt or confusion.” Hojek v. Harkness, 314
Ill. App. 3d 831, 834 (2000). This is true even if the jury was properly instructed initially. People
v. Childs, 159 Ill. 2d 217, 229 (1994). When a jury makes its difficulties clear, “the court should
resolve them with specificity and accuracy *** [and] failure to answer or the giving of a response
which provides no answer to the particular question of law posed” can be “prejudicial error.” Id.¶ 54 Circuit courts have some discretion in this area, however, and “in exercising that discretion,
depending on the nature of the question, [the court may] choose to abstain from responding.”
Hojek, 314 Ill. App. 3d at 834. These circumstances include, “when the instructions are readily
understandable and sufficiently explain the relevant law, where further instructions would serve
no useful purpose or would potentially mislead the jury, when the jury’s inquiry involves a
question of fact, or where the giving of an answer would cause the court to express an opinion that
would likely direct a verdict.” People v. Millsap, 189 Ill. 2d 155, 161 (2000). A circuit court’s
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decision on how to respond to a jury’s question is reviewed for abuse of discretion. Hojek, 314 Ill.
App. 3d at 834. “An abuse of discretion occurs only when the court’s decision was arbitrary or
unreasonable to the degree that no reasonable person would adopt the same view.” People v.
Jaimes, 2019 IL App (1st) 142736, ¶ 45.
¶ 55 The jury asked two related questions. First, it asked, “For Counts 1 and 2 of fraud, do we
need to find all five propositions true for: statements wise A, all three together? Or B, only one of
three?” The circuit court refused to substantively respond, rejecting Plaintiffs’ position that there
was a clear answer, which the court should provide, and agreeing with Defendants that a
substantive response was inappropriate. After the court responded only that the jury should follow
its instructions and continue deliberating, the jury then asked another question on the same point:
“Note: Do all three statements:
• B1-3;
• Property perfect for;
• Property could be used,
need to be true for each proposition?
Question: If one statement is false, does that [make] the entire proposition false?” (Emphasis
in original).
The court again only instructed the jury to follow its instructions and continue deliberating. In so
deciding, the court stated that the correct answer was Plaintiffs only needed to establish all five
elements as to one of the three alleged false statements, but believed the instructions were
sufficiently clear to convey this information. The jury ultimately ruled in favor of Defendants on
the fraud counts.
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¶ 56 We find that the circuit court abused its discretion by not answering the jury’s questions to
clarify Plaintiffs only needed to establish the five elements of fraud as to one of the three alleged
false statements. While circuit courts have discretion in how they respond to jury questions, this is
an instance where the general rule that the court has a duty to answer when it will clarify a matter
of law on which the jury has demonstrated confusion applies. See Childs, 159 Ill. 2d at 228-29.
The jury instructions stated that Plaintiffs had to prove Horwich made “a” false statement—that
is, a singular false statement, meaning any one of the three alleged false statements could suffice.
But for a lay juror, it is not surprising that this lone word, “a,” did not make this point of law
apparent, and the jury responsibly asked for clarification instead of assuming the law was one way
or another based on its uncertain understanding. The parties and the court all acknowledged the
question had a correct and succinct answer. This answer could have been provided without the
court suggesting a verdict. See Millsap, 189 Ill. 2d at 161. Nor are the other concerns regarding
substantively answering a jury’s question at issue—the instructions were not readily
understandable, as described above; an answer would have served an important purpose; and the
question did not revolve around an issue of fact. See Id. Finally, because of the court’s refusal to
answer this question, the certainty with which the jury reached its verdict on counts I and II is now
questionable, which is the issue the general rule on jury questions is meant to avoid. See Van
Winkle v. Owens-Corning Fiberglas Corp., 291 Ill. App. 3d 165, 173 (1997) (prejudicial error not
to substantively respond to jury’s question where it involved “a substantive legal issue” that was
“potentially dispositive”).
¶ 57 On this record, it is unclear if the jury properly understood Plaintiffs only had to prove all
five elements of fraud as to one of the three alleged false statements, and therefore the circuit court
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No. 1-22-1877
abused its discretion by failing to clarify this point of law when it had the chance. Accordingly,
we vacate the jury’s verdicts on counts I and II, and remand for a new trial on those counts.
¶ 58 Hojek is helpful to our resolution. There, this court found that the circuit court’s refusal to
answer a jury question on whether a party’s medical expenses were covered by insurance
necessitated a new trial because, “the jury brought a question to the attention of the trial court
concerning a substantive legal issue” which “went to the issue at the heart of the case,” in an
instance where the question did not concern an issue of fact and would not cause the court to
express an opinion on its favored result. Hojek, 314 Ill. App. 3d at 837. The Hojek court further
explained that a substantive answer was appropriate because “a simple instruction would have
been useful to the jury and provide[] an accurate answer to their question.” Id. This situation is
similar, as the question the jury asked was about a pure legal issue—what elements Plaintiffs had
to prove to establish a claim for fraud—and clarification of that issue would have aided the jury in
their task, without suggesting the court’s favored verdict to the jury.
¶ 59 Hojek cited Van Winkle, which is also instructive. In Van Winkle, the circuit court refused
to answer a jury’s question regarding a purely legal issue on civil conspiracy. Van Winkle, 291 Ill.
App. 3d at 171-73. The Van Winkle court found this constituted reversible error because the jurors
expressed confusion about a “potentially dispositive” substantive legal issue. Id. at 173. Our
situation is analogous—the jury expressed confusion about a purely legal issue, the proper
understanding of which was crucial to its disposition on counts I and II.
¶ 60 Also instructive is the Illinois Supreme Court’s discussion in Childs (though in the context
of a criminal matter), where the circuit court refused to answer the jury’s question of “whether
defendant could be found guilty of armed robbery and either voluntary or involuntary
manslaughter, or if a finding of guilt of armed robbery mandated” a finding of guilt for murder.
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Childs, 159 Ill. 2d at 225, 229. The court considered this “an explicit question which manifested
juror confusion on a substantive legal issue,” and therefore the circuit court had a duty to
substantively respond to it. Id. The Childs court explained that the “jurors are entitled to have their
inquiries answered,” and the general rule regarding the court’s duty applies where the jury “has
posed an explicit question or requested clarification on a point of law arising from facts about
which there is doubt or confusion.” Id. at 228-29. Similarly, here, the jury could not have made its
specific point of confusion any clearer, and there was a simple, neutral answer for the court to give.
Its refusal to do so, therefore, violated its duty as the Childs court explained it, and the error was
prejudicial given the verdict.
¶ 61 Defendants argue that Plaintiffs cannot seek relief on this claim because it was Plaintiffs’
instruction about which the jury expressed confusion. This argument fails because it is irrelevant
which party offered the instruction at issue—as the Childs court explained, the duty to respond
substantively to a jury question can arise even if the jury was properly instructed initially. Id. at
229.
¶ 62 Defendants also argue that the law granting circuit courts discretion in this area should guide
our decision, citing People v. Reid, 136 Ill. 2d 27, 39 (1990), in support. In Reid, the supreme court
decided that the circuit court properly refused to substantively answer the jury’s question where
the court concluded the jury was not confused, and an answer could potentially “indicate a specific
verdict to the jury.” Id. at 41. The Reid court decided that while the circuit court could have
answered the question, it was within its discretion not to in that instance. Id. at 42. We believe Reid
is distinguishable from this case because there was no risk that an answer would have indicated a
verdict, as simply clarifying what elements the jury needed to find in order to rule in Plaintiffs’
favor is not suggestive that Plaintiffs established those elements. Moreover, to the extent the court
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did not believe the jury was confused, that belief is directly rebutted by the record. The jury twice
asked for clarification on a specific issue—it would be hard to ask the jury to more clearly express
confusion. Given the record, we reject that the result in Reid is controlling, and maintain that the
principles illustrated in Hojek, Van Winkle, and Childs apply.
¶ 63 Finally, we address Plaintiffs’ claim that the circuit court erred by finding for Defendants
on the License Act claim because it erroneously based its ruling on an unreasonable inference that
the seller provided the zoning information.
¶ 64 Under the License Act, real estate brokers must “treat all customers honestly and shall not
negligently or knowingly give them false information.” 225 ILCS 454/15-25 (West 2010). To
establish a claim under the License Act, a plaintiff must show that a broker negligently or
knowingly provided false information, and “the false information (i) did not come from the seller,
(ii) was material to the buyer, and (iii) caused damages.” Edson I, 2019 IL App (1st) 181135, ¶ 44
(citing Capiccioni v. Brennan Naperville, Inc., 339 Ill. App. 3d 927, 930 (2003)). We review a
circuit court’s findings on whether a License Act violation occurred under the manifest weight of
the evidence standard. Pack, 2019 IL App (1st) 182447, ¶ 92.
¶ 65 The circuit court resolved this claim by finding that Plaintiffs failed to establish the
information at issue did not come from the seller, explaining that it could infer from the record that
LINVIC supplied the original B1 zoning information. Edson I, 2019 IL App (1st) 181135, ¶ 44.
Plaintiffs argue that this finding was against the manifest weight of the evidence because there was
no evidence in the record regarding any conduct by LINVIC with respect to the zoning
information. The court acknowledged this but based its inference on the evidence that the previous
broker, Marina Lee Ma, included the B1 zoning designation in her promotional materials for the
Property. There is no evidence in the record regarding Ma’s reasons for listing the Property’s
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No. 1-22-1877
zoning as B1. Horwich testified that he generally copied or “cloned” Ma’s listing, but
independently changed Ma’s B1 zoning designation to B1-3, despite checking a zoning map and
not seeing B1-3 as the listed zoning for the Property.
¶ 66 On this record, we find the circuit court’s decision was against the manifest weight of the
evidence, and remand for a new trial on this claim, because the inference that the zoning
information came from the seller was unreasonable. The only competent evidence in the record on
this element is that the information came from Horwich and Ma, not LINVIC. The record lacks
any evidence of conduct by someone on behalf of LINVIC, or any indication as to how or why Ma
decided to list the zoning as B1. While we must provide significant deference to a lower court’s
findings on manifest weight of the evidence we review, we can only defer to reasonable inferences.
See People v. Thomas, 2019 IL App (1st) 170474, ¶ 39 (unreasonable inference is against the
manifest weight of the evidence). Based on the above, the court’s finding was based on speculation,
not evidence, and thus unreasonable. See Burmood v. Anderson, 2023 IL App (2d) 230092, ¶¶ 36-
38 (citing Daniggelis v. Pivan, 159 Ill. App. 3d 1097, 1103-04 (1987), for proposition that a
“verdict that is based on conjecture or speculation is against the manifest weight of the evidence”).
We note that Plaintiffs request entry of judgment in their favor on this claim, but this is not
appropriate relief because the circuit court did not explain whether it found Plaintiffs established
the other elements of a License Act claim.
¶ 67 CONCLUSION
¶ 68 The circuit court correctly directed a verdict against the purchase price as an element of
damages, and then refused to give a jury instruction on that element. Additionally, the court’s
refusal to instruct the jury on the statutory theories of negligent misrepresentation did not prejudice
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Plaintiffs, and the court’s findings on the Consumer Fraud Act claims were not against the manifest
weight of the evidence. We affirm the court’s findings on those issues.
¶ 69 The court erred, however, by refusing to answer the jury’s questions regarding Plaintiffs’
fraud claims, and by finding in favor of Defendants on the License Act claim. We therefore vacate
the jury’s verdict on the fraud claims and the court’s verdict on the License Act claim, and remand
for a new trial on those claims only.
¶ 70 Affirmed in part; Vacated in part; Remanded in part with instructions.
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