Court Opinion

ID: 6500916
Source: CourtListenerOpinion
Date Created: 2022-07-18 22:03:30.064985+00
Date Added: 2024-06-11T09:21:37.156712
License: Public Domain

2022 IL App (2d) 210557-U
                                        No. 2-21-0557
                                   Order filed July 18, 2022

      NOTICE: This order was filed under Supreme Court Rule 23(b) and is not precedent
      except in the limited circumstances allowed under Rule 23(e)(l).
______________________________________________________________________________

                                            IN THE

                             APPELLATE COURT OF ILLINOIS

                              SECOND DISTRICT
______________________________________________________________________________

ADDISON ARMS APARTMENTS, LLC,          ) Appeal from the Circuit Court
                                       ) of De Kalb County.
                                       )
      Plaintiff-Appellant,             )
                                       )
v.                                     ) No. 20-LM-0232
                                       )
BRITTANY MC CORP.,                     )
LARRY MCDONALD, and                    )
BRITTANY MC CORP. 2152,                ) Honorable
                                       ) Bradley J. Waller,
      Defendants-Appellees.            ) Judge, Presiding.
______________________________________________________________________________

       JUSTICE JORGENSEN delivered the judgment of the court.
       Justices Schostok and Brennan concurred in the judgment.

                                           ORDER

¶1     Held: The trial court’s order granting defendants’ motion to enforce settlement is
             reversed.

¶2     Plaintiff, Addison Arms Apartments, LLC, sued defendants, Brittany Mc Corp., Larry

McDonald, and Brittany Mc Corp. 2152, for breach of contract and breach of guarantee arising

from a commercial lease agreement. After defendants did not file a responsive pleading, the trial

court granted plaintiff’s summary-judgment motion. The parties later engaged in settlement

negotiations, and defendants ultimately moved to enforce the settlement. In sum, the dispute
2022 IL App (2d) 210557-U

centered on the scope of the term “release.” The court granted the motion to enforce settlement,

denied plaintiff’s motion to reconsider, and plaintiff appeals. For the following reasons, we

reverse.

¶3                                       I. BACKGROUND

¶4                 A. Lease Agreement, Complaint, Default Summary Judgment

¶5      On December 5, 2016, Brittany Mc Corp., as tenant, and Larry McDonald, as guarantor,

entered into a commercial lease agreement with a former landlord (who later assigned the

agreement to plaintiff) for property located at 131 North Annie Glidden Road in De Kalb. The

lease required the tenant to pay incrementally increased annual rent, common area maintenance

fees, insurance, and taxes over 20 years, with a possible 5-year extension (e.g., $10,000 monthly

for the first 5 years, $11,000 monthly during years 6 through 10, etc.). Upon default, the agreement

provided, in part, that the landlord had the right, at its option, to declare the rents for the remaining

term, including legal fees and costs of collection, and other indebtedness, immediately due and

payable. Further, any rights and remedies given under the lease to the landlord were “cumulative

and in addition to and without waiver of or in any derogation of any right or remedy given to it

under any law now or thereafter in effect.”

¶6      On August 12, 2020, plaintiff notified defendants that they had fallen behind in rent and an

action in forcible entry and detainer would be commenced within 10 days. On August 28, 2020,

plaintiff filed its verified complaint, seeking damages and possession of the premises. Defendants

filed an appearance, but no responsive pleading.

¶7      In December 2020, plaintiff moved for summary judgment, seeking amounts owed through

that date. On February 9, 2021, the court granted plaintiff’s summary-judgment motion. The

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judgment awarded plaintiff $90,559.36 total ($85,505.01 in damages, $784.35 in court costs, and

$4270 in attorney fees).

¶8                 B. Citation to Discover Assets and Settlement Negotiations

¶9     On March 17, 2021, plaintiff filed a citation to discover assets, and, on March 24, 2021,

the answer from the third-party respondent reflected $64,291.86 in a specified checking account.

On March 25, 2021, Britany Mc Corp. 2152 filed an appearance and a motion to extinguish the

citation lien on the checking funds, essentially arguing that the wrong account had been frozen in

response to the citation.        Thereafter, the parties’ attorneys began exchanging email

communications.

¶ 10   Specifically, on March 26, 2021, defendants’ attorney, Benjamin Jacobi, emailed

plaintiff’s attorney, Michael Franz, regarding “compromise negotiations.” In part, he discussed

the lien that was imposed in response to the citation to discover assets and defendants’ desire to

have the lien extinguished. However, Jacobi also noted that, while his clients could pursue

vacating the summary judgment against them, they also understood the risks going forward and

wished to resolve “this dispute” without either party incurring additional legal fees. (Emphasis

added.) As such, “in exchange for a full satisfaction of the judgment and a release from [plaintiff],”

McDonald offered a cash lump sum of $50,000 and an assignment to plaintiff of all rights in the

personal property at the premises, unencumbered and valued at $40,000 to $50,000. Jacobi’s email

concluded, “[w]e believe that this more than adequately compensates your client and satisfies the

judgment in whole.” (Emphasis added.)

¶ 11   On March 30, 2021, Franz responded, in part, “[m]y client rejects the below offer but is

willing to settle in consideration for payment of $75,000.00 plus a turnover of the equipment.” No

release was mentioned.

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2022 IL App (2d) 210557-U

¶ 12   On March 31, 2021, Jacobi replied that defendants had rejected plaintiff’s settlement

proposal. However, they instead offered “(1) $65K in a lump sum cash [payment] within 30 days,

and (2) assign/transfer the Personal Property to your client, in exchange for a full satisfaction of

the judgment and a release from your client.” (Emphasis added.)

¶ 13   Later that morning, Franz wrote that he had discussed defendants’ offer with plaintiff.

Plaintiff was “willing to go down to $70,000.00 plus the equipment. I was told that this is a final

offer.” Again, no release was mentioned.

¶ 14   Jacobi replied:

       “We have a deal at $70K + the equipment in exchange for a satisfaction of the judgment

       and a release from your client. My client can pay the cash payment within 30 days. We

       will want the Citation dismissed.       We would also like you to draft the settlement

       agreement.” (Emphases added.)

¶ 15   Franz responded, “Will do. Thanks.”

¶ 16   Jacobi next emailed Franz a list of the equipment to include as an appendix to the settlement

agreement. On April 1, 2021, Franz noted that plaintiff was “very concerned” that defendants

would not pay the agreed amount and inquired as to the earliest that they could provide payment.

Defendants agreed to wire payment the next business day, if a settlement agreement was in place,

but Jacobi noted that they had not yet seen a “draft” of the settlement agreement.

¶ 17   Accordingly, on April 2, 2021, Franz emailed Jacobi a “settlement agreement and mutual

release.”

¶ 18   A few hours later, Jacobi emailed back a revised agreement, noting that “a couple of edits

are redlined. If this is agreeable, I will recommend that my client execute the settlement agreement

today.” (Emphasis added.)

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¶ 19   Jacobi’s redline edits expanded the scope of the release from one releasing claims

concerning the dispute, judgment, and citation to one also releasing claims concerning the lease

agreement, First Amendment, and guaranty. Shortly after receiving Jacobi’s edits to the draft

agreement, Franz emailed:

       “The only issue I see is including a release of the guarantor under the written agreements.

       My client is only agreeing to resolve the current litigation, judgment[,] and Citation. Any

       future claims after the judgment will not be released. Otherwise, everything should be fine.

       I am confirming that payment on Monday, by wire, is good for my client.”

¶ 20                       C. Motion to Enforce Settlement Agreement

¶ 21   Three days later, on April 5, 2021, defendants moved to enforce the settlement agreement.

They recounted the settlement negotiations as reflected in the email exchange, noting that, when

Franz emailed defendants a “draft” settlement agreement, the “proposed” agreement did not

include plaintiff’s release of defendant from the lease. Rather, it provided a release only from the

current judgment (i.e., the default summary judgment). “Defense counsel redlined the Settlement

Agreement to include also a release from the lease per the email agreement,” yet Franz responded

that plaintiff was releasing defendants only from the current litigation, judgment, and citation, not

from future claims. (Emphasis added.) According to defendants, the only reasonable way to

interpret the term “full satisfaction of the judgment and release from your client” is a satisfaction

of the current judgment and a release of all other claims, including all claims arising from the

lease. Defendants argued that plaintiff’s subjective intent concerning the type of release was

irrelevant, noting that their own “objective intent” was repeated three times in the email

correspondence, when they offered terms in exchange for a satisfaction of the judgment and a

“release from [plaintiff].” They argued that, if defendants had intended to settle only the current

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2022 IL App (2d) 210557-U

lawsuit, they would have needed only a satisfaction of the judgment and not an additional release.

As the only relationship that existed between the parties was the lease, defendants argued, the only

possible release they could request was from the lease agreement. “Defendants agreed to pay

money plus property valued at approximately $20,000 to $30,000 more than the judgment amount,

and Plaintiff agreed to release Defendants from the lease. Otherwise, Defendants would not have

agreed to pay a settlement value in excess of the judgment.” (Emphasis in original.) Defendants

requested that the court enforce the settlement, including a term in which plaintiff “generally

releases Defendants from the lease and all amendments thereto,” as set forth in the redlined

settlement agreement. Defendants attached to their motion the email exchange between the

attorneys, as well as the redlined draft settlement agreement.

¶ 22   In response, plaintiff asserted that, while the parties reached a settlement agreement, it

disagreed with the terms now proposed by defendants. As background, it noted that, in its

complaint and the court’s summary-judgment order, it never requested and the court never granted

damages for the 16 years or any amounts owed by defendants after December 31, 2020, through

the termination of the lease agreement on December 31, 2036. Rather, plaintiff sought seizure of

$90,559.36: the amounts owed through December 2020, plus attorney fees and costs. Thus, while

$70,000, plus the equipment in exchange for a “satisfaction of the judgment and release from your

client” were the “literal agreed to terms of the parties’ settlement agreement,” plaintiff’s drafted

proposed agreement had included a release only from the current litigation. “Indeed, had plaintiff

agreed to settle defendants’ post-judgment 16 years of obligations under the lease agreement,

plaintiff would not have accepted more than $20,000.00 less than the judgment amount.”

(Emphasis added.) Plaintiff noted that settlement agreements are binding only if there is an offer,

acceptance, and meeting of the minds as to the terms of the agreement, and, here, the email

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2022 IL App (2d) 210557-U

correspondence gave no indication that plaintiff agreed to settle and release defendants from 16

years of postjudgment obligations; rather, the correspondence reflected that plaintiff agreed to

settle and release only the claim related to the court’s February 9, 2021, judgment. Indeed, plaintiff

argued, Jacobi’s initial email reflected this was also defendants’ intention, as it reflected that

defendants believed that their proposed settlement terms more than adequately compensated

plaintiff “and satisfie[d] the judgment in whole.” As there was no meeting of the minds to release

defendants from anything more than the February 9, 2021, judgment, plaintiff requested that the

court deny defendants’ motion.

¶ 23   In reply, defendants asserted that, in its response, plaintiff had conceded that the parties

reached a settlement agreement and that the “literal” terms included satisfaction of judgment and

a release. As such, they argued, the dispute concerned the interpretation of those terms, which the

court must view objectively, giving meaning to all terms. Defendants argued that, in order to give

meaning to all terms, “release” must be interpreted as providing something other than “satisfaction

of the judgment.” Further, that defendants sought a “release from your client” reflected that they

sought a general release, as a release “from your client” is a release from the relationship, which

was one that existed only under the commercial lease. Defendants again noted that the cash

payment, plus the value of the equipment, exceeded the judgment amount, supporting their

contention that they were buying a release in addition to the satisfaction of judgment. Finally, as

to the sentence in defendants’ initial email, they argued (1) it was not a term of the offer, as the

terms of the offer were separately set forth before the concluding sentence; (2) it supported

defendants’ interpretation, as it had two parts (a) compensating plaintiff and (b) satisfying the

judgment; and (3) even if construed as a proposed term of the settlement, it was rejected by

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2022 IL App (2d) 210557-U

plaintiff, with defendants later making two additional offers, increasing the proposed cash payment

term and including their terms for satisfaction of the judgment and a release.

¶ 24   On May 14, 2021, after hearing argument, the court agreed with defendants and granted

the motion to enforce the settlement terms with a general release. The court referred to the

definition of “release” as the relinquishment of a right, claim, or privilege. It then stated that a

release is a contract in which “one party agrees to give up all claims of any type against another.

A release can be a partial release, but the term must specify that.” Here, the court found,

defendants’ counsel consistently used the terms “full satisfaction of the judgment and a release,”

in the correspondence, and plaintiff admitted that the parties entered into a settlement agreement,

but disputed the interpretation of the word “release.”

¶ 25   The court further noted that plaintiff’s lawsuit sought damages for rent, taxes, and

insurance from August 1, 2020, through December 7, 2020, but not through the year 2036,

although the lease provided that it could do so. “Plaintiff elected its remedies. The judgment was

entered based on a breach of the contract/lease and the guarantee. Those contractual obligations

merged into the judgment. Plaintiff is not entitled to now file another cause of action for breach

of contract and guarantee for the period 2020 to 2036.”

¶ 26   However, the court noted, even if plaintiff could pursue such an action, the “second

analysis” concerns the term “release.” The court noted that it must give effect to each term set

forth in “what I have found to be a legally-enforceable contract” and to “give effect to the intent

of the parties in effectuating each term of the contract.” The court found that the only legal

relationship that existed between the parties was based upon the lease and personal guarantee, and

plaintiff’s counsel never used the phrase “partial release,” nor did he ever dispute or clarify that

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2022 IL App (2d) 210557-U

the release encompassed only the judgment up to December of 2020 “at any time prior to or at the

time the settlement was entered into on March 31st of 2021.” The court continued,

               “What motivation would defendants have to turn over the personal property and the

       $70,000 if they didn’t get the—if they didn’t get to walk away free and clear of any and all

       obligations owed to plaintiff in the future?

               Presumably plaintiff didn’t have a security interest in the equipment, so defendants

       were giving cash and unencumbered property in return for *** plaintiff’s releasing each of

       the respective defendants from any and all further and future obligations.

               Release here means that plaintiff relinquish[ed] any and all rights, claims, causes

       of action arising out of the lease and the guarantee, past, present, and future. In other

       words, a general or a full and complete release.”

¶ 27   The court ordered defendants to pay plaintiff $70,000 and prepare and execute a bill of sale

transferring equipment and personal property to plaintiff, free and clear of any liens or

encumbrances. It also ordered plaintiff to tender a satisfaction of judgment to the court, an order

dismissing the case with prejudice, and a release of any all rights, claims, and causes of action

arising out of the lease and guarantee, both past, present, and future.

¶ 28                                 D. Motion to Reconsider

¶ 29   Plaintiff moved to reconsider. It reiterated that settlement agreements are not binding if

there is no meeting of the minds or unequivocal acceptance of terms. Further, it argued that it

never authorized its attorney to settle all claims under the lease agreement, but only the judgment

entered against defendants on February 9, 2021. Plaintiff attached an affidavit from Marc Fein,

plaintiff’s property supervisor, who attested that he authorized Franz to accept defendants’

settlement offer of $70,000, plus assigning ownership of equipment on the premises to plaintiff,

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but explicitly instructed that plaintiff was not releasing McDonald from his personal guarantee for

future claims, and that plaintiff intended to resolve only the February 9, 2021, judgment. Fein

attested that he never authorized Franz to settle all potential claims owed by defendants under the

lease agreement.

¶ 30   Defendants responded that the issue of plaintiff’s counsel’s authority was waived (as it was

raised for the first time in a motion to reconsider), plaintiff’s counsel had express and apparent

authority to enter into the settlement agreement, and plaintiff’s requested relief was mooted by the

doctrine of merger.

¶ 31   On August 26, 2021, at oral argument on the motion, another attorney, Timothy Hoffman,

appeared on plaintiff’s behalf. Hoffman challenged the court’s findings concerning plaintiff’s

election of remedies and the doctrine of merger, noting that payment of future rent is not a present

obligation and recovery for breach of lease is limited to the amount due at the time of trial. Further,

Hoffman argued that, as evidenced by Fein’s affidavit, Franz did not have authority from plaintiff

to release defendants from future claims. In addition, after the court commented that plaintiff did

not, when it rejected defendants’ initial offers, contest the terms requiring full satisfaction of the

judgment and release from plaintiff, Hoffman noted that Franz never promised that a release would

include future rent. “This was an assumption made by the defendant[s].”

¶ 32   The court denied the motion. In sum, the court backed away from any perceived reliance

in its ruling on the election of remedies or merger. It noted that it had not primarily relied on the

doctrine of merger and perhaps should not have mentioned it because the predicate of its decision

concerned whether the agreement contemplated a general release. As the parties agreed on the

“literal” terms of the agreement, the issue was “not an ambiguity, so to speak, but rather, an

interpretation of the agreement as it pertained to the issue of release.” The court did not find

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appropriate consideration of parol evidence concerning plaintiff’s intent to release. It reiterated

that there was no ambiguity, and that release and satisfaction of judgment are legal terms with

specific, well-defined meanings and that the terms intended to release and satisfy any and all

obligations between the parties.

¶ 33   The court also noted that Franz’s authority was being challenged for the first time on the

motion to reconsider. Further, the court found that Franz had authority to settle. Plaintiff appeals.

¶ 34                                       II. ANALYSIS

¶ 35   Plaintiff argues that the trial court erred in granting defendants’ motion to enforce

settlement and finding that the release term meant that plaintiff relinquished all rights, claims, and

causes of action arising out of the lease. It notes that the court focused on the fact that plaintiff’s

counsel never used the words “partial” release, and it questioned whether defendants would have

been motivated to settle without a general release, yet it failed to ask the same questions on

plaintiff’s behalf. After it had already received a judgment on its claim for rent through December

2020, “[w]hat motivation would Plaintiff have to settle a $2,354,600.00 debt for $70,000.00 plus

equipment and forgo its absolute right to sue again for the future obligations under the lease

agreement?” Plaintiff notes that the court incorrectly ignored that, although on March 31, 2021,

the parties had a settlement agreement regarding the past due rents, on April 2, 2021, Jacobi first

introduced “general release” terms by redlining the draft settlement agreement and asking whether

plaintiff was agreeable with the changes. Franz did not agree to the changed terms, asserting that

plaintiff agreed only to resolve the current litigation. Accordingly, plaintiff argues, Jacobi’s

proposed change to include a “general release” that Franz had not included in the proposed

settlement agreement changed the entire “deal” because plaintiff went from releasing a $90,559.36

judgment for $70,000 and equipment to releasing a “2.3 million debt for $70,000.00!” Further, “if

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2022 IL App (2d) 210557-U

Mr. Jacobi was so confident that a settlement agreement was reached, and that Plaintiff intended

to release defendants from all claims under the lease agreement, why would he even ask if Plaintiff

was ‘agreeable’ to the proposed changes ***?” Specifically, Jacobi’s email stated: “a couple of

edits are redlined. If this is agreeable, I will recommend that my client execute the settlement

agreement today.” (Emphasis added.) In addition, plaintiff notes that the facts do not align with

defendants’ contention that plaintiff somehow ratified the “general release” when it did not dispute

the release term in the correspondence. Plaintiff unequivocally challenged the general-lease

language when Jacobi first introduced it in redline edits. Finally, plaintiff “completely disagrees”

with defendants’ position that the payment terms support their claim for release, because they

agreed to pay $70,000 and assign rights to restaurant equipment worth $40,000 to $50,000, which

exceeded the judgment and reflects they were buying a release. Plaintiff notes that, under the

lease, the equipment became plaintiff’s property as of the date of the breach, defendants had not

provided evidence to corroborate the equipment’s estimated value, but, in any event, even if the

equipment was worth $40,000, the deal that the trial court “foisted” on plaintiff becomes no less

ridiculous: “releasing a $2.3 million debt for $110,000 (as opposed to $70,000), when Plaintiff had

already received summary judgment on liability. Who in their right mind would agree to such a

deal after they had already secured a judgment in their favor?” For the following reasons, we

agree.

¶ 36     In general, Illinois encourages the settlement of claims. Kim v. Alvey, Inc., 322 Ill. App.

3d 657, 669 (2001). Thus, we review a trial court’s finding that a settlement agreement exists

under the manifest-weight-of-the-evidence standard. See, e.g., Lampe v. O’Toole, 292 Ill. App.

3d 144, 146 (1997).      However, as settlement agreements are construed under contract-law

principles, we interpret de novo settlement terms. See, e.g., Hassebrock v. Deep Rock Energy

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Corp., 2015 IL App (5th) 140105, ¶ 37 (“The interpretation of a settlement agreement or

assignment, both of which are governed by contract principles, is a matter of law that we also

review de novo.”). “As with any contract, there must be an offer, an acceptance, and a meeting of

the minds on terms.” Lampe, 292 Ill. App. 3d at 146. Moreover, when a trial court does not hold

an evidentiary hearing related to a purported settlement agreement’s formation and terms, we

review de novo the court’s order enforcing the settlement agreement. See, e.g., Lukanty v.

Moglinicki, 2022 IL App (1st) 210794, ¶ 30.

¶ 37   Here, after reviewing the record and hearing argument, the trial court found that the parties

came to an agreement and that the term “release” in that agreement was not ambiguous. Rather,

the court found, the parties’ disagreement concerned “interpretation of the agreement as it

pertained to the issue of release.” (Emphasis added.) In our view, the record reflects that, while

the parties agreed to certain material terms (i.e., $70,000, assignment of equipment, satisfaction of

the judgment, and a “release”), 1 and while the word “release” may not be inherently ambiguous,

the record nevertheless reflects that there was no meeting of the minds concerning the scope of the

release. Thus, we conclude that, under either the de novo or manifest-weight standard, the trial

court erred in granting defendants’ motion to enforce the settlement.

¶ 38   Specifically, the record reflects that plaintiff had obtained a $90,000 judgment in its favor,

including rent due under the lease agreement only through December 2020.                Rather than

undertaking the risks and legal expenses associated with attempting to vacate that judgment,

defendants initiated with plaintiff “compromise negotiations.” In their initial email, defendants

       1
           In other words, as plaintiff’s counsel wrote in his response to the motion to enforce the

settlement, the “literal terms” of the agreement.

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explained that they wished to resolve “this dispute” and framed their offer to compromise as more

than adequately compensating plaintiff and “satisfying the judgment in whole.” (Emphasis added.)

With that context in mind, i.e., a judgment in its favor and an offer from defendants to “satisfy the

judgment in whole” via compromise, plaintiff engaged in negotiations. On multiple occasions

during those negotiations, however, plaintiff rejected defendants’ request for a “release.” Indeed,

plaintiff’s own “final offer” made no mention of a release. Nevertheless, on March 31, 2021, in

response to plaintiff’s final offer, defendants added a “release” term and requested that plaintiff’s

counsel provide them with a draft agreement. Plaintiff’s counsel responded, “will do,” reflecting

that he would draft a settlement agreement. He later sent defendants a draft agreement, including

a mutual release of claims concerning the “dispute” (defined internally by the trial court case name

and number), “judgment,” and “citation.” This version of the agreement was clearly a draft, as on

April 2, 2021, defendants’ counsel made redline edits to that draft and asked if plaintiff was

“agreeable” to the changes. Those changes, for the first time, reflected defendants’ express

indication that the release would include all future claims that could arise under the lease and

guarantee. Specifically, defendants’ proposed redline changes provided that, in addition to

mutually releasing claims concerning the dispute, judgment, and citation, the release would also

cover the “Lease Agreement,” “First Amendment,” and “the guaranty.” Plaintiff immediately

rejected defendants’ changes to the scope of the release.

¶ 39   Given these facts, we cannot conclude that there was a meeting of the minds on the scope

of the release term. The trial court and defendants focused on plaintiff’s counsel’s concession that

an agreement existed, contending that the agreement was memorialized on March 31, 2021, when

plaintiff’s counsel responded, “will do.” However, even assuming an agreement on terms was

reached at that time, the scope of those terms was not yet clearly defined. For example, even the

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specifics of the equipment to be assigned was not yet defined, as defendants’ counsel later emailed

plaintiff’s counsel a list of equipment to include as an appendix to a draft settlement agreement.

Similarly, the scope of the “release” was not yet defined as of March 31, 2021, with the specifics

of that term being fleshed out in the draft agreement. The trial court found relevant that, prior to

March 31, 2021, plaintiff’s counsel never used the phrase partial release, nor “at any time prior to

or at the time the settlement was entered into on March 31st of 2021,” did he dispute or clarify that

the release encompassed only the judgment up to December 2020. We disagree with the court’s

assessment. Plaintiff’s counsel never had occasion or reason to use the phrase “partial release”

prior March 31, 2021; indeed, before March 31, 2021, plaintiff repeatedly rejected all releases

defendants requested. Then, at plaintiff’s first opportunity to define the scope of the release term,

i.e., in the draft settlement agreement that defendants requested plaintiff prepare, plaintiff reflected

its understanding that the release would be limited or partial, not general and for all future claims.

When expressly asked if it was agreeable to a general release, plaintiff immediately communicated

that it was not. Similarly, the court seemed to accept defendants’ suggestion that plaintiff ratified

a general release when, after March 31, 2021, but before a draft agreement was prepared, plaintiff

did not dispute the release term. Simply put, why would it? The parties were not, in that time

frame, discussing that term; they were discussing payment timing. There was not yet any reason

for plaintiff to know there was a dispute on the scope of the release. Given the record, we disagree

with the court’s assessment that plaintiff’s failure, prior to March 31, 2021, to limit the release, or

its failure to do so after March 31, 2021, but prior to circulating the draft agreement on April 2,

2021, served as any ratification of a general release term.

¶ 40    We note that, generally speaking, release terms containing very broad language that do not

reflect any clear definition or indication of what claims are being released are interpreted in a

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manner to restrict the release to include only those claims clearly intended by the parties to be

released, not claims not contemplated by the parties. See, e.g., Thornwood, Inc. v. Jenner & Block,

344 Ill. App. 3d 15, 21 (2003); International Insurance Co. v. Sargent & Lundy, 242 Ill. App. 3d

614, 622-24 (1993) (“A general release will be held to apply only to those claims in existence at

the time the release is executed and ‘claims which originate subsequent to its execution are not

discharged absent a clear expression of intent to that effect.’ ” [citation omitted]) (emphasis

added)). While, as defendants note, an action may nevertheless be released, even if it is not

specifically mentioned or in existence when the release is executed because it may be cumbersome

or confusing to list all claims (Sargent & Lundy, 242 Ill. App. 3d at 624-25), here, it would not

have been cumbersome to expressly list all future claims under the lease and defendants’ mention

of “release” in the March 31, 2021, email did not do so. In any event, the record reflects that it

was not the intent of both parties to do so. Yet, rather than restricting the scope of the broad,

undefined word “release” to only those claims that both parties clearly contemplated, the trial court

performed an opposite construction, interpreting the word as reflecting that plaintiff was

relinquishing “any and all rights, claims, causes of action arising out of the lease and guarantee,

past, present, and future.” Again, the record belies that interpretation. If anything, here, the only

claims both parties clearly intended to mutually release were those up to the date of judgment;

while defendants also wanted more claims released, the record reflects that the intent was

unilateral, as plaintiff communicated it was not agreeing to a release of future claims.

¶ 41   The trial court also agreed with defendants’ argument that the release term must have meant

something more than satisfaction of the judgment; otherwise, under plaintiff’s interpretation, the

terms are redundant and meaningless. Again, we disagree. More specifically, while we agree that

a satisfaction of judgment and a release have different meanings, we disagree that, absent an

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interpretation that the release was a general release of all future claims, the terms here would be

redundant. As defendants note in their brief, a satisfaction of judgment is a complete discharge of

obligations under a judgment and/or the document filed and entered on the record indicating that

a judgment has been paid. Black’s Law Dictionary (11th ed. 2019).2 Here, however, plaintiff’s

proposed release encompassed more than simply payment of the judgment obligations. Plaintiff

proposed a mutual release of any and all claims under the dispute, judgment, and citation. A

mutual release of such claims is separate from and not redundant to a term that the agreement

serves to “satisfy”, i.e., pay, the $90,000 judgment amount and terminate that litigation.

¶ 42   Defendants also argue that plaintiff’s subjective understanding was not a requirement for

a meeting of the minds, which instead exists when the parties’ conduct objectively indicates an

agreement to the settlement terms, even if one party did not subjectively intend to be bound. This

may be true, but as we have detailed above, plaintiff’s objective conduct here never reflected an

intent to be bound to a general release. Further, although defendants argue that a “release” must

mean a “general release” from the lease, where the only relationship between the parties is the

       2
           Further,

       “Generally, a satisfaction of a judgment is the final act and end of a proceeding.

Satisfaction implies or manifests an expression of finality as to all questions of liability and

damages involved in the litigation. Once satisfaction occurs, further alteration or amendment of a

final judgment generally is barred. Satisfaction of a judgment, when entered of record by the act

of the parties, is prima facie evidence that the creditor has received payment of the amount of the

judgment or its equivalent, and operates as an extinguishment of the judgment debt.” (Emphases

added.) 47 Am. Jur. 2d Judgments § 1006, at 443 (1995).

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lease at issue, we disagree. Under the fact of this case, the lease agreement provided varying

obligations from the parties at varying times over the course of 20 years. Without specificity, we

cannot presume that the word “release” alone, in the face of written expressions to the contrary,

necessarily meant a release of all claims of all kinds now and in the future. We also find

unconvincing defendants’ argument that, when it requested a “release from your client,” it was

requesting a release from the relationship with plaintiff under the lease. This is, at best, a strained

interpretation. Rather, defendants requested a release from the “client,” i.e., plaintiff, because

plaintiff was the only party that could give them one.

¶ 43   We also note that, even if it were appropriate for the court to have gone beyond the record

to consider “motivations,” as the foregoing facts are apparent on the face of the record and in the

written email exchanges, the court did not do so for both parties. The court did not question why

plaintiff would agree to release all claims under a 20-year lease, for an amount, at most (if the

equipment value is $50,000), roughly $30,000 in excess of the judgment it had already received

(plus, plaintiff had already obtained, in response to a citation to discover assets, a lien on

$64,291.86 in a bank account), but it queried why defendants would want to settle, if not to obtain

a general release for all future claims under the lease. Yet that question was already answered in

defendants’ own email initiating settlement negotiations: to avoid the risks and legal expenses

associated with trying to vacate a judgment that had already been entered against them (further,

defendants wanted the citation lien extinguished). They sought instead to vacate the $90,000

judgment against them through settlement, in the nature of a reduced cash offering and an

assignment of equipment. We could speculate that, perhaps, these terms were to defendants’

benefit because they would not need to produce as much cash and the restaurant equipment was

no longer useful to them, as they had vacated the premises (indeed, plaintiff contends that the

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2022 IL App (2d) 210557-U

equipment reverted to plaintiff anyway upon default under the lease). Whatever the situation or

defendants’ rationale, the point is that the trial court did not need to question defendants’

motivations for agreeing to settle for less than a general release of all future claims under the lease.

¶ 44    In sum, the record is devoid of evidence that there was a meeting of the minds on the scope

of the “release” term in the agreement. “Although some terms of a contract may be missing or left

to be agreed upon, the parties’ failure to agree upon an essential term of a contract indicates that

the mutual assent required to make a contract is lacking and, thus, there is no enforceable contract.”

Rose v. Mavrakis, 343 Ill. App. 3d 1086, 1091 (2003). The court erred in granting defendants’

motion to enforce the settlement, and we reverse the court’s order. As such, we need not address

plaintiff’s alternative arguments concerning its motion to reconsider and its attorney’s settlement

authority.

¶ 45                                     III. CONCLUSION

¶ 46    For the reasons stated, the judgment of the circuit court of De Kalb County is reversed.

¶ 47    Reversed.

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