No. 3--00--0283

_________________________________________________________________

							IN THE

							APPELLATE COURT OF ILLINOIS

							THIRD DISTRICT

							A.D., 2001 

CURTIS INVESTMENT FIRM,			)	Appeal from the Circuit Court

LTD. PARTNERSHIP,				)	of the 14th Judicial Circuit,

	)	Rock Island County, Illinois

	Plaintiff-Appellee,			)	

							)

	v.						)	No. 99--SC--3598

							)	

ROBERT R. SCHUCH and			)	

SUSAN A. SCHUCH,	)	Honorable

                                )	Dennis DePorter

	Defendants-Appellants.		)	Judge, Presiding

_________________________________________________________________

	JUSTICE BRESLIN delivered the opinion of the court:

_________________________________________________________________

	The plaintiff, Curtis Investment Firm, Ltd. Partnership

(Curtis Investment), brought an action against the defendants,

Robert and Susan Schuch, alleging failure to disclose a defective

water supply line.  The trial court entered judgment for Curtis

Investment in the amount of $1,532.50, plus costs.  On appeal,

the Schuches claim that Curtis Investment waived any right to

recovery under the Residential Real Property Disclosure Act (Act)

(765 ILCS 77/1 et seq. (West 1998)) by failing to demand a disclosure report prior to closing.  The Schuches also argue that

the judgment was erroneous because they had no actual knowledge

of the defect at the time of sale.  We determine that the Act is

mandatory and cannot be waived.  In addition, we defer to the trial court's finding of actual knowledge in that it was not

against the manifest weight of the evidence. 

	FACTS

	Curtis Investment entered into a contract to purchase a

piece of residential property owned by the Schuches. 

Approximately six weeks prior to the closing, Curtis Investment

requested a real property disclosure report.  The Schuches did

not provide the report.  The closing proceeded without any

written contingencies and Curtis Investment purchased the home.  

	Prior to the sale, the Schuches had the home's water supply

turned off at the curb box rather than at the interior meter. 

When Curtis Investment attempted to reinitiate the water supply,

it discovered that the supply line between the curb box and the

house was faulty.  The interior water system needed repair as

well.  Curtis Investment repaired the water supply system at its

own expense.  At the time of trial, the repairs totaled $1532.50. 

	Curtis Investment filed a small claims suit against the

Schuches seeking to recover the cost to replace the water supply

system.  During the trial, Robert Schuch denied any knowledge of

a problem with the supply line or the residential system.  The

trial court held that under the Act, a buyer cannot waive its

right to receive a disclosure report.  The court found that the

Schuches knew the water supply line was defective and entered

judgment for Curtis Investment for the cost to repair the system. 

The Schuches appeal.

	ANALYSIS

	On appeal, the Schuches first argue that, contrary to the

trial court's holding, a buyer can waive its right to receive a

real property disclosure statement if the buyer signs a contract

for purchase without receiving a residential disclosure

statement.

	The primary rule of statutory construction is to ascertain

and give effect to the intent of the legislature.  Miller v. Bizzell, 311 Ill. App. 3d 971, 726 N.E.2d 175 (2000).  The court should first consider the statutory language itself.  When the

language of the statute is clear, it should be given effect

without resorting to other aids of construction.  People ex rel. Baker v. Cowlin, 154 Ill. 2d 193, 607 N.E.2d 1251 (1992).  Legislative use of the word "shall" is generally considered to

express an intent that the provision be mandatory.  Hoffman Estates Professional Firefighters Assn. v. Village of Hoffman

Estates, 305 Ill. App. 3d 242, 711 N.E.2d 1109 (1999).    	

	Section 20 of the Act provides that:

		"A seller of residential real property shall complete all applicable items in the disclosure

document described in Section 35 of this Act.  The

seller shall deliver to the prospective buyer the written disclosure statement required by this Act

before the signing of a written agreement by the seller

and prospective buyer that would, subject to the

satisfaction of any negotiated contingencies, require the prospective buyer to accept a transfer of the

residential real property."  (Emphasis added.)  765

ILCS 77/20 (West 1998).

We find the use of the word "shall" in this section requires a

mandatory reading of the provision.  The plain language of the

statute mandates that the buyer be provided a disclosure

statement before closing on a residential sale.  The statute does

not list any exceptions.  We therefore hold that a buyer cannot

waive the seller's responsibility to disclose certain defects by

signing a contract without receipt of a written disclosure

statement.

	We reject the Schuches' assertion that the language of

section 20 gives the buyer the option to waive receipt of the

report.  The Schuches maintain that section 20 provides that the

disclosure report is "subject to the satisfaction of any

negotiated contingencies."  They claim that one such negotiation

could be the waiver of the disclosure statement.  However, a

reading of the entire section clearly demonstrates that the

"subject to" language relates to the written agreement to

purchase the property, not the seller's disclosure statement. 

Accordingly, the trial court's determination that a buyer cannot

waive receipt of a real property disclosure report was correct.

	Other provisions of the Act require a mandatory reading of

the statute as well.  Section 55 provides that "[a] person who

knowingly violates or fails to perform any duty prescribed by any

provision of this Act or who discloses any information on the Residential Real Property Disclosure Report that he knows to be

false shall be liable in the amount of actual damages and court

costs."  765 ILCS 77/55 (West 1998).  The language in this

provision demonstrates that the legislature intended mandatory

liability in the event the seller fails to comply with the Act. 

Consequently, a seller cannot fail or refuse to provide a

disclosure report with impunity.1 

	Finally, consideration of the objective of the statute

supports our conclusion that a buyer's right to receive a

disclosure statement prior to closing cannot be waived.  The

primary purpose of the statute is to provide a remedy for

aggrieved buyers of residential real property.  See 90th Ill. Gen. Assem., House Proceedings, May 20, 1997, at 6.  To allow a

seller to ignore his obligation under the Act to avoid reporting

a material defect and defeat a buyer's subsequent claim would

only encourage the evils the legislature sought to remedy.  See

People v. Peters, 180 Ill. App. 3d 850, 536 N.E.2d 465 (1989) (court should consider objective of the statute and evils

legislature sought to remedy and arrive at a construction that is

founded in common sense).  Since the Schuches failed to perform their duty under the Act, they are responsible for the damages

incurred to replace the water supply system.    

	In the alternative, the Schuches argue that even if a

disclosure report must be provided, they should not be held

liable for the damage sustained.  Under section 25 of the Act, a

seller is not liable for any error, inaccuracy, or omission of

information if the seller had no knowledge of the error,

inaccuracy, or omission.  765 ILCS 77/25(a) (West 1998).  The

Schuches claim that the trial court's finding that they knew the

water supply line was faulty was against the manifest weight of

the evidence. 

	Whether the Schuches knew the line was leaking prior to the

closing is a question of fact to be determined by the trial

court.  See Woods v. Pence, 303 Ill. App. 3d 573, 708 N.E.2d 563 (1999) (whether seller knew of material defect is a question of

fact).  A trier of fact need not accept a party's testimony that

he had no knowledge of a particular fact in question if the

evidence shows to the contrary.  Erickson v. Muskin Corp., 180 Ill. App. 3d 117, 535 N.E.2d 475 (1989), rev'd on other grounds, 143 Ill.2d 188, 572 N.E.2d 920 (1991).  When reviewing a question

of fact, we defer to the trial court's finding unless it is

against the manifest weight of the evidence.  King v. Ashbrook, 313 Ill. App. 3d 1040, 732 N.E.2d 621 (2000).  A trial court's

judgment is against the manifest weight of the evidence only if

an opposite conclusion is clearly evident.  Fletcher v. Marshall, 260 Ill. App. 3d 673, 632 N.E.2d 1105 (1994).  

	The record in the present case is scant.  Robert Schuch

denied any knowledge that the water supply line to the residence

or the interior system was faulty.  However, he admitted that he

had the residential water supply turned off at the curb box,

rather than the meter inside the house.  We recognize that the

evidence that the Schuches knew a problem existed is less than

overwhelming.  However, we cannot say that an opposite conclusion

to that reached by the trial court is clearly evident.  We

therefore affirm the trial court's finding that the Schuches had

knowledge of the defect at the time of the sale.

	For the foregoing reasons, the judgment of the circuit court

of Rock Island County is affirmed.			

	Affirmed.

	LYTTON, J., concursring.

	HOLDRIDGE, J., dissenting.

No. 3--00--0283 – Curtis Investment v. Schuch

JUSTICE HOLDRIDGE, dissenting:

	I respectfully dissent.  While the majority is correct in finding that the seller must provide the real property disclosure

report to the buyer, I believe they err in finding that this

obligation to the buyer cannot be waived by the buyer.  "Waiver"

is defined as "the intentional relinquishment of a known right."

Illinois Valley Electric Co-Operative, Inc. v. City of Princeton, 229 Ill. App. 3d 631, 638 (1992). A waiver may be made by express

agreement or implied from the conduct of the party who allegedly

waived the right. Ryder v. Bank of Hickory Hills, 146 Ill. 2d 98, 105 (1991). Waiver will be implied when a party's conduct is

inconsistent with an intention to assert the right. A waiver may

be made by express agreement or implied from the conduct of the

party who allegedly waived the right. Ryder, 146 Ill. 2d at 105.

	Here, the buyers requested the real property disclosure

report approximately six weeks prior to the anticipated closing

date.  The sellers did not provide the report, yet the sellers

elected to proceed with the closing despite the lack of the

report.  The statutory remedy available to a buyer who has not

received a disclosure report is clear: "If the seller fails or

refuses to provide the disclosure document prior to the

conveyance of the residential real property, the buyer shall have the right to terminate the contract. (Emphasis added.)" (765 ILCS 77/55 (1998)).  

	It is clear that the buyers had a right to terminate the

contract due to the sellers’ failure to provide the disclosure

report.  Yet they elected not to terminate and proceed with the

transaction.  This conduct clearly indicated an intention to

waive the right to receive the report.  

	I would find that the buyers waived the right to recovery

under the Act and I would reverse the judgment of the circuit

court and remand for entry of judgment for the defendants.