Property II, Pages 814–817

Hubble v. O'Connor

Appellate Court of Illinois, 1997

Facts:

Plaintiff sold defendant a condominium. The written contract contained a clause which allowed the contract to be voided if either party's attorney gave notice of disapproval within five business days of its formation. Although it was signed and tendered, they continued to discuss modifications past the five day period. Two weeks after the modification period had ended, defendant's attorney gave notice that he was invoking the disapproval clause.

Procedural History:

Circuit court entered judgment in favor of defendants.

Issue:

Was defendant's attorney allowed to withdraw his approval?

Plaintiff's Argument:

Defendants' attempted to exercise the attorney disapproval clause after they were no longer allowed to.

Defendant's Argument:

The contract was implied to not become binding until the lawyers gave their approval. Therefore, the timer for the five days had not started yet.

Rule:

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[I]f there is doubt as to what was intended by the purchasers actions, that doubt is resolved in favor of avoiding a forfeiture of the contract

Reasoning:

  • An implied covenant would directly contradict the express covenant in the attorney disapproval clause that the contract would remain in full force and effect if timely notice of disapproval was not given. Defendants' attempt was not timely, and no prior communication gave notice of disapproval either.

  • Such a powerful right as to void the agreement by disapproval requires that it be invoked without unambiguously. This was not done.

Holding:

Defendants did not fairly inform the plaintiffs that they were revoking the contract, and therefore it became irrevocable when the disapproval period ended.

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