Chicago Codes
Court nixes suit against developers

Law Bulletin staff writer

Suburban homeowners may not pursue a class action against real estate developers because the homeowners failed to show that the developers knew that the centerpiece of their sales pitches a golf course would not be built, a state appeals panel has ruled.

Despite three filings, ''several extensions,'' seven months of discovery and ''several depositions,'' homeowners in the Marley Creek subdivision in Orland Park could not show that the developers knew there would be no golf course next to the subdivision when they bought their homes, a three-judge panel of the 1st District Appellate Court ruled Thursday.

Therefore, Cook County Circuit Judge Donald J. O'Brien Jr. acted within his discretion when he dismissed the homeowners' class-action fraud suit, Justice Alan J. Greiman wrote in a 10-page opinion.

The homeowners had claimed that executives of Distinctive Homes Ltd. and MGM Development Inc. had scrapped plans for the golf course in 1996 but continued to make sales pitches that included plans for a golf course through 2000, Greiman wrote.

The property that was eyed for the course was instead ''rezoned for industrial purposes'' in 2000, Greiman wrote.

In 2002, the homeowners filed a putative class action, alleging that the developers had violated the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/1, and committed common-law fraud, Greiman wrote.

The homeowners twice amended their complaint before O'Brien dismissed it with prejudice.

On appeal, the homeowners argued that O'Brien had used the wrong standard in granting the developers' motion to dismiss and that he should have allowed the homeowners to plead their claims anew, Greiman wrote.

The appeals court disagreed.

''In order to successfully plead fraud, plaintiffs had to allege that defendants knew that plans for the golf course had been abandoned at the times the plaintiffs purchased their properties,'' Greiman wrote.

In this case, the homeowners' complaint asserts that the developers had scrapped plans for the course in 1996, but the homeowners' exhibits ''fail to establish when plans for the golf course were abandoned,'' Greiman wrote.

''Without that specific allegation, [the homeowners'] claims of fraud were insufficient on their face. We fail to see how re-pleading would have aided in their survival or furthered the ends of justice,'' Greiman wrote.

Justices Patrick J. Quinn and Mary Jane Theis joined in the opinion.

Daniel A. Edelman, Cathleen M. Combs, James O. Latturner and Francis R. Greene of Edelman, Combs, Latturner & Goodwin LLC represented the homeowners.

W. Matthew Bryant, formerly of James J. Roche & Associates LLC, and Stanley A. Kitzinger, formerly of Condon & Cook LLC and now of McKnight, Kitzinger, McCarty & Pravdic LLC, defended the developers.

Dennis Addison, et al. v. Distinctive Homes Ltd. et al., No. 1-04-0151.