Seniority Has Its Privileges
During the recent residential real estate development boom, our client, a real estate broker, and his partners successfully negotiated for a large national builder, the acquisition of two farms. The first farm, consisting of 300 acres, sold for $16 million. The second farm, consisting of 450 acres, sold for $30 million. At a 5% commission rate, our clients had $2.3 million in commissions at stake! While the market was hot, the national builders were gobbling up the countryside at record prices. However, things changed once the market got cold.
After placing the farms under contract for acquisition, the builder “land banked” the farms. This consists of finding a nominee to acquire the farm at the existing contract price, and the land banker “sells” the property back to the builder at a higher, enhanced sales price.
This is also called “off-balance sheet financing.” In our case, the national builder denied that it incurred liability to our client for the 5% commission because, it claimed, it had not acquired the property, the land banker had.
Of course, that argument ignored the fact that the builder and the land banker were under a separate contract to sell and purchase the property in the future. With more than $2 million at stake, the real estate brokers were vitally interested in getting the case concluded pronto.
However, our court system moves slowly. We had two national corporate defendants with large treasuries devoted to paying attorneys; a crowded court system; and judges with too many cases. Luckily, one of the brokers was over 70 years old, 85 to be exact, and subject to preferential treatment according to Section 2-1007.1 of the Code of Civil Procedure. The law provides that individuals who have reached the age of 70 years be entitled to preference in setting for trial. Of course, using our client’s age as an advantage, we filed suit and immediately requested the court to set the case for trial in a few months.
Our strategy worked. The court learned the plaintiff was 85 years old. The court set the case for trial nine months later (that is pretty fast for Cook County, Illinois). The lawyers had a compressed schedule for taking depositions, producing documents and exchanging pre-trial information. This caused the lawyers to put pressure on the clients to settle the case and the elderly client received a very favorable award. Of course, the other brokers under the age of 70 received the same benefit as the one over 70. They had the good luck of partnering-up with someone who received a preference for trial. As we have heard in the past, seniority should have its privileges!