Opinion ID: 2176088
Heading Depth: 1
Heading Rank: 2

Heading: facts

Text: In June 2005, plaintiffs and defendants entered into a real estate contract for the purchase and sale of certain residential property located in Orland Park, Illinois. The contract provided for proration of real estate taxes as follows: Prorations of general taxes shall be on the basis of 105% of the last ascertainable bill. If said bill [is] based on a partial assessment or on an unimproved basis for improved property, a written agreement (with escrow) for final proration when the complete assessment information is available from the County Assessor shall be signed at closing by the parties hereto. At the September 14, 2005, closing, plaintiffs received a real estate tax credit of $3,025.92 for 2004, and a credit of $4,076.08 for 2005. The credits were based on the 2003 real estate tax figure, as shown on the title commitment, prorated according to the above contract provision. After closing, the final 2004 tax bill issued, disclosing a tax liability of $7,876.59, substantially more than the $3,025.92 credit plaintiffs received at closing. According to the allegations of plaintiffs' complaint, upon receipt of the 2004 tax bill, investigation revealed that the 2003 tax figure was based on a partial assessment. [1] Plaintiffs' position was summed up in an October 12, 2005, letter from plaintiffs' attorney to defendants' attorney, which was attached to the complaint. The letter stated: Enclosed is a copy of the tax bill that just came out   . As you can see, taxes went up quite a bit. We checked with the county to find out why. They tell us that the 2003 bill was based on a partial assessment. No one had disclosed that fact to us at or prior to closing. In these types of situations, under the contract we should have entered into a re-proration agreement. The amount due from your client to mine for 2004 taxes is $4,850.67 (the actual bill of $7,876.50 less the credit   of $3,025.92). The amount due from your client to mine for the reprorated 2005 taxes is $3,780.93 (10,627.43 x 105% = 11,158.80/365 x 257 = 7,857.01-4,076.08  ). The total due then [is] $8,631.60. Plaintiffs alleged that the discrepancy in the taxes was either a mutual mistake of fact, or was known by the defendants and not disclosed by them. Plaintiffs sought damages of $8,631.60, plus court costs. Defendants answered the complaint, generally denying that plaintiffs were entitled to a reproration. Defendants also asserted, as an affirmative defense, that they had no knowledge that any real estate taxes, past or present, were based on a partial assessment, and that defendants gave to plaintiffs what they believe was a proper real estate tax credit at the time of closing based upon the available information and per the contract. Defendants also filed a motion to dismiss under section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2006)). Defendants argued that under the merger doctrine the real estate contract merged into the deed, thus precluding recovery by plaintiffs. Although plaintiffs argued that mutual mistake and fraudulent concealment are recognized exceptions to the merger doctrine, defendants argued that this court had never sanctioned a broad mutual mistake exception and that, in any event, this court's opinion in Lenzi v. Morkin, 103 Ill.2d 290, 82 Ill.Dec. 644, 469 N.E.2d 178 (1984), controlled. The circuit court granted defendants' motion to dismiss with prejudice. Plaintiffs appealed. The appellate court reversed the judgment of the circuit court. 371 Ill.App.3d at 351, 308 Ill.Dec. 836, 862 N.E.2d 1039. The appellate court distinguished Lenzi because the merger doctrine was not at issue in that case, and held that the doctrine does not apply to plaintiffs' action for real estate taxes. 371 Ill.App.3d at 348-51, 308 Ill.Dec. 836, 862 N.E.2d 1039. We allowed defendants' petition for leave to appeal. See 210 Ill.2d R. 315.