Saturday, May 26, 2012

This stuff cannot be made up.

The Illinois Supreme Court released an opinion yesterday dealing with abandonment of claims and fraudulent misrepresentation.  But that stuff is boring.  No one really cares about abandonment of claims and fraudulent misrepresentation.  That stuff doesn't sell newspapers (or blogs).

People want to read about scandal and intrigue.  People want to read about other people whose lives are more whacked out than their own.  Well, if that's what you like, then just keep reading because it's about to get weird in here.  (Plus, if you really do care about abandonment of claims and fraudulent misrepresentation, I'll address them briefly at the end.)

In 2005, a woman from Batavia, Illinois ("defendant") created an account in an online chatroom called the "Deadwood Boards," which was dedicated to the HBO television series Deadwood.  She created the account as a man named "Jesse James."  She began chatting as "Jesse" with other people, including a woman in California ("plaintiff").

"Jesse" eventually developed an online, romantic relationship with plaintiff.  They chatted on the Deadwood Boards, they exchanged personal emails, they sent each other handwritten letters, gifts, and personal photos.  They even spoke on the telephone, with defendant using a voice-altering device to disguise her female voice and sound more like "Jesse."

During this time, defendant also developed a relationship with plaintiff under her own name. She claimed to be a common friend of Jesse.  Defendant also developed a universe of approximately 20 other fictional online characters that were either related to or otherwise involved with Jesse, including an ex-wife, a son, his therapist, and various friends and family members.  These characters all communicated with plaintiff from separate and distinct email addresses.  They also sent photos, handwritten letters, and packages that were postmarked from different states and several foreign countries.

In response, plaintiff sent gifts and cash worth more than $10,000 to Jesse and the other fictional characters.  These fictional characters were really messing with plaintiff.  For instance, plaintiff, who thought she was dating Jesse, purchased tickets to actually fly and meet him.  Jesse, however, emailed and cancelled the plans.  Then, several of the fictional characters, including Jesse's therapist, contacted plaintiff to tell her that Jesse had attempted suicide.  This caused plaintiff to start seeing a therapist of her own, which eventually cost her more than $5,000.

After Jesse recovered from his suicide attempt, plaintiff wanted him to move in with her.  Jesse agreed to move to California.  Plaintiff spent nearly $1,000 preparing her house for Jesse to move in.  Shortly before he was supposed to move in, however, Jesse's "sister," Alice, informed plaintiff that Jesse had died from liver cancer.  This caused plaintiff to enter a deep depression.  She experienced headaches, exhaustion, inability to sleep, inability to concentrate at work, and she contracted a recurring infection known as multidrug resistant staphylococcus aureus ("MRSA") because her immune system was so weakened.

Defendant, posing as herself, then flew to California to help plaintiff grieve the loss of Jesse.  Plaintiff again spend nearly $1,000 readying her house for the visit.  While defendant was out there, some of plaintiff's actual friends discovered the fictional nature of the universe of characters created by defendant and confronted her.  She admitted everything on videotape.


Plaintiff then filed a seven-count complaint in Kane County, Illinois for fraud and other claims.    Following several motions to dismiss, six of the counts were eventually dismissed with prejudice.  Plaintiff filed a third amended complaint that only alleged fraudulent misrepresentation.  That count was also dismissed with prejudice.  Plaintiff appealed.  The appellate court reversed the dismissal of the third amended complaint.  Both sides filed petitions for leave to appeal to the Supreme Court.  The Supreme Court took both appeals. Plaintiff was appealing the ruling that she had abandoned the first six counts when she filed a third amended complaint alleging only fraudulent misrepresentation.  Defendant was appealing the ruling that plaintiff had actually stated a case for fraudulent misrepresentation.


The Supreme Court held that "a party who files an amended pleading waives any objection to the trial court's ruling on the former complaints," and "where the amendment is complete in itself and does not refer to or adopt the prior pleading, the earlier pleading ceases to be part of the record for most purposes, being in effect abandoned and withdrawn."  

In this case, the plaintiff abandoned the first six counts when she filed the one-count, third amended complaint.  So, if you elect to replead after dismissal of several counts, you must refer to or adopt the dismissed counts or you will have abandoned them.


The history and origin of fraudulent misrepresentation lie in the common law action of deciet, "a very narrow tort that applies only to cases involving business or financial transactions between parties."  And while courts have, on rare occasions, have recognized claims for fraudulent misrepresentation in settings that are not, strictly speaking, "commercial" or "financial" in nature, they have never recognized fraudulent misrepresentation in a setting that is "purely personal" in nature.

In this case, plaintiff and defendant were not engaged in any kind of business dealings or bargaining and all misrepresentations were made in a purely personal relationship, so plaintiff's fraudulent misrepresentation count failed as well.

So, more than seven years after the relationship started, the plaintiff was left with nothing.

HERE is the opinion.  Don't believe everything you read online, people.  Later!!

Friday, May 25, 2012

Withdrawals from Savings are not Income When Calculating Child Support Using the Statutory Guidlines

The Illinois Supreme Court has ruled that saving’s account withdrawals are not income when calculating child support using the statutory percentage guidelines.

In the McGrath divorce the mother was granted residential custody of the children and the issue of child support was reserved because the father was unemployed.  The mother later filed a petition asking the court to enter a child support order.  At the hearing the father testified that he was still unemployed and was living off of $8,500 he withdrew from his savings account each month.

The trial court ordered the father to pay $2,000 per month but explained it was NOT imputing income to him, just using the fact that the father was “receiving or obtaining money on a regular basis” in its decision.

When the father filed a motion to reconsider, the trial court denied his motion.  The court explained that it was required by statute to determine what child support would be awarded using the guidelines, and then used the monthly withdrawal amount as “passive net income” and applied various adjustments to arrive back at the amount in its original order.

The appellate court upheld the trial court’s decision, explaining that IMDMA’s “definition of ‘net income’ is expansive: ‘the total of all income from all sources’” and that withdrawals from savings is not among the specific exclusions from net income.

The Supreme Court said they both got it wrong.  The issue is not with the definition of “net income” but with the definition of “income.”  And withdrawals from a savings account are not income because the “money in the account already belongs to the account’s owner, and simply withdrawing it does not represent a gain or benefit to the owner.”

But the mother is not totally out of luck.  The Supreme Court remanded the case to the trial court for a new calculation.  As allowed by IMDMA §505 the court can deviate from the guidelines and consider “the financial resources” of the father.
IRMO McGrath, 2012 IL 112792

Submitted by Brian D. Moore, Class of ’92.

Monday, May 21, 2012

Who really owns that car?

Did you know that the Illinois Secretary of State will perform a vehicle title search for $5.00?  Neither did I.  
Dawn Weekly pointed this out on the ISBA email list today.  Another attorney wanted to know who to subpoena to ascertain ownership of a car.  Dawn pointed out that the Secretary of State has a standard procedure for this and that no subpoena was necessary.

HERE is a link to the Information Request Form, which has also been added to the Forms Archive on this site.  

Please note that you must have a permissible purpose under the Driver Privacy Protection Act (18 U.S.C. 2721, et seq.).  Section E on page 2 of the form, however, gives broad leeway to attorneys who request this information in anticipation of litigation, in connection with litigation, or to enforce any judgment or order.

Thanks for the info Dawn!

Side note: If you haven't subscribed to the ISBA email lists yet, they are an invaluable resource.  Almost as good as this blog!!

Friday, May 18, 2012

Lenders must respond to short sale offers within 90 days.

Short sales are one of the more frustrating areas in today's real estate industry.  Countless legitimate short sale offers are withdrawn because the banks just do not respond for months at a time.  I have clients right now whose lease is expiring at the end of June.  We submitted a short sale offer in March.  I don't think we'll hear back from the bank, much less close the deal, before they're going to have to vacate their apartment.

A recent amendment to the Mortgage Foreclosure Act seeks to remedy this situation.  The Act now requires the bank to respond to a written short sale offer within 90 days, if the property is the subject of a residential foreclosure case.

It is a relatively short section, so I have copied the entire text of the new statute below:

    (a) For purposes of this Section, "short sale" means the sale of real estate that is subject to a mortgage for an amount that is less than the amount owed to the mortgagee on the outstanding mortgage note.

    (b) In a foreclosure of residential real estate, if (i) the mortgagor presents to the mortgagee a bona fide written offer from a third party to purchase the property that is the subject of the foreclosure proceeding, (ii) the written offer to purchase is for an amount which constitutes a short sale of the property, and (iii) the mortgagor makes a written request to the mortgagee to approve the sale on the terms of the offer to purchase, the mortgagee must respond to the mortgagor within 90 days after receipt of the written offer and written request. 

    (c) The mortgagee shall determine whether to accept the mortgagor's short sale offer. Failure to accept the offer shall not impair or abrogate in any way the rights of the mortgagee or affect the status of the foreclosure proceedings. The 90-day period shall not operate as a stay of the proceedings. 

(735 ILCS 5/15-1401.1)

Tuesday, May 1, 2012

People v. Salgado clarifies defendant's right to confront witnesses

The case of People v. Salgado 2012 IL App (2d) 100945 (March 15th, 2012) has shed some light on the rights of defendants to be present when witnesses are testifying. The second district appellate court held that it was in error to allow the defendants daughter to testify in the judge’s chambers while the defendant remained in the courtroom. While the defendant agreed to let his daughter testify in this fashion, the court did not show that the defendant properly understood his confrontation rights and voluntarily waived that right. 

In Salgado, the defendant was charged with 2 counts of Class 4 felony domestic battery and at the time that his daughter was set to testify, the state asked to have the daughter testify in the judge’s chamber outside the presence of the defendant. After a moment with defendant, defense counsel agreed to allow the daughter to testify outside the presence of the defendant. Defendant was convicted of both counts and sentenced to 18 months imprisonment.

The appellate court only addressed one claim of error on appeal, the argument that defendant was denied his confrontation right. The appellate court cited the previous Illinois Supreme Court case of Peoplev. Lofton, 194 Ill. 2d 40 (2000),which held that it was a violation of the confrontation clause when a defendant could not see the alleged victim testify in his sexual assault trial, due to physical barriers being erected in the courtroom. Because the right to confrontation includes the ability to see and hear witnesses testify, any “innovation” that prevents the defendant from hearing and seeing the testimony would impede their ability to help in cross-examination and violates the confrontation clause.

While a violation of confrontation rights does not mean an automatic reversal, the Second District found that defendant was completely deprived of these rights because he was unable to ever hear the daughter’s testimony, and thus the case should be reversed and remanded. Additionally, while state argued that defendant waived his right, the court disagreed, writing that “The waiver plainly was not proper as nothing in the record shows that defendant understood that he had a right to be present.” Salgado at 5.

Under People v. Stroud, 208 Ill. 2d 398, 409 (2004), which is cited by the Salgado opinion, “a defendant’s appearance at a guilty plea proceeding via closed-circuit television is constitutionally permissible only if the defendant waives the right to physical presence on the record after being advised of his right to be present.” (Emphasis added.) Stroud, 208 Ill. 2d at 409. Because there was nothing on the record showing that defendant understood his confrontation right, let alone voluntarily and knowingly waived it, it was improper for the court to proceed.

The court suggests that it could be allowable for the daughter to testify via closed circuit camera from inside the judge’s chambers or another area, as this would allow defendant to see and hear her testimony, even without wavier, but the court’s solution in the instant case was unacceptable because it deprived the defendant of any ability to see or hear witnesses testimony without a knowing waiver.