Opinion ID: 619438
Heading Depth: 2
Heading Rank: 1

Heading: Mr. Broaddus’ and Mr. Shields’ Business Rela-

Text: tionship Will Partners, LLC (“Will Partners”), was organized in 1998 to acquire and improve real property in Monee, Illinois. Mr. Shields was the managing member of Will Partners. Between 1998 and 1999, Will Partners financed and facilitated the construction of a 700,200 square foot warehouse to serve as the central distribution facility for World Kitchen, Inc. (“WKI”). WKI paid rent to Will Partners each month. On November 2, 2000, Mr. Broaddus entered into a written agreement for a 10% membership interest in Will Partners (the “November 2000 Agreement”). Mr. Broaddus’ share garnered approximately 45% of Will Partners’ net cash flow. In November 2001, Mr. Broaddus was involved in a serious car accident. He suffered significant bodily injury No. 11-1117 3 and a traumatic brain injury. A legal guardian was appointed for him on February 15, 2002. In September 2002, Mr. Broaddus requested that the guardianship be terminated and represented that he “ha[d] recovered sufficiently from his injuries to manage his own affairs.” The guardianship was terminated. In late 2002, Mr. Shields contacted Mr. Broaddus, and they discussed the fact that WKI was in bankruptcy. Mr. Shields informed Mr. Broaddus that Will Partners would need to make a capital call in order to pay WKI’s real estate tax installment. Mr. Broaddus alleges that Mr. Shields also told him that WKI was delinquent on its rent of approximately $45,000 per month. Mr. Shields denies making that representation. Sometime after this discussion, Mr. Broaddus and Mr. Shields discussed the sale of Mr. Broaddus’ interest in Will Partners. The parties have different recollections of the relevant conversations. Mr. Shields attests that in October or November 2002, Mr. Broaddus asked him to purchase Mr. Broaddus’ interest in Will Partners so that Mr. Broaddus could move to Florida. According to Mr. Shields, Mr. Broaddus demanded $800,000 for his interest, and Mr. Shields countered at $400,000. Mr. Broaddus contends, however, that Mr. Shields approached him in March 2003 and offered to buy his interest in Will Partners so that Mr. Broaddus would not have to put more money into the company. The parties agree that in March 2003, Mr. Shields purchased Mr. Broaddus’ interest in Will Partners for $600,000. Between March 26 and March 30, 2003, 4 No. 11-1117 Mr. Broaddus executed at least two assignments in connection with the transaction (the “March 2003 Assignments”). In both assignments, Mr. Broaddus represented and warranted that he “has had an opportunity to ask questions and receive answers regarding the terms and conditions of the sale . . . and has had full access to such other information concerning [Will Partners] as he has requested, including an opportunity to examine the books and records of [Will Partners] and to discuss the condition of [Will Partners].” Mr. Broaddus alleges that he only sold his interest in Will Partners because Mr. Shields allegedly told him that WKI—Will Partners’ only tenant—was not paying rent. Documents produced during discovery show that WKI was, in fact, paying rent during the relevant time. Mr. Shields emphasizes that Will Partners sent Mr. Broaddus a copy of the February 2003 and March 2003 income statements to Mr. Broaddus’ office, indicating that WKI had paid its rent. Mr. Broaddus asserts that he did not receive those statements because he was recovering from the car accident and was not traveling to his office during the relevant time. Mr. Broaddus admits, however, that he received the distribution deposits reflected on the financial statements and that Will Partners could not have made a distribu- tion unless WKI was paying its rent. Nevertheless, Mr. Broaddus claims that he could not have reasonably discovered that WKI was paying its rent until the summer of 2003. No. 11-1117 5