No.

1-09-0556
Appellate Court of Illinois, First District

Kranzler v. Saltzman
407 Ill. App. 3d 24 (Ill. App. Ct. 2011) • 942 N.E.2d 722
Decided Jan 18, 2011

No. 1-09-0556. limitations ( 810 ILCS 5/3-118(g) (West 2008);

735 ILCS 5/13-205, 13-206 (West 2008)). For the
Opinion filed January 18, 2011. Rehearing denied
following reasons, we affirm.
25 February 10, 2011. *25

Appeal from the Circuit Court of Cook County; JURISDICTION

the Hon. Dennis J. Burke, Judge, presiding. The trial court entered a final judgment in the
instant case on January 27, 2009, and defendant
Roderick F. Mollison, of Chicago, for appellant.
26 filed his notice of appeal on February *26 26,
Adelman Gettleman, Ltd., of Chicago (Steven B. 2009. Accordingly, this court has jurisdiction
Chaiken, of counsel), for appellee. pursuant to Illinois Supreme Court Rules 301 and
303 governing appeals from final judgments
JUSTICE HARRIS delivered the judgment of the entered below. Ill. S. Ct. R. 301 (eff. Feb. 1,
court, with opinion. 1994); Ill. S. Ct. R. 303 (eff. May 30, 2008).

Justices Karnezis and Connors concurred in the BACKGROUND

judgment and opinion. On March 10, 1997, plaintiff Leonard Kranzler
loaned defendant Lewis Saltzman $100,000.
OPINION Defendant signed a typewritten "memo" on that
Plaintiff Leonard Kranzler loaned defendant same date that read as follows:
Lewis Saltzman $100,000 upon the defendant
signing a written "memo" that stated, "Loaned to "Memo to: Leonard Kranzler March 10,
Lewis Saltzman $100,000 to be paid back with 1997 Loaned to Lewis Saltzman $100,000
interest." The defendant intermittently made to be paid back with interest. /s/ Lewis
payments that partially repaid the loan. Within 10 Saltzman"
years of the date of the defendant's last payment Between November 30, 1999, and July 5, 2005,
on the loan, plaintiff filed suit in the circuit court plaintiff received intermittent payments on the
of Cook County alleging the "memo" to be a debt totaling $74,500. The payments ceased after
promissory note and seeking judgment for the July 5, 2005, and on June 29, 2007, plaintiff filed
outstanding principal and interest. The trial court a complaint in the circuit court seeking judgment
found in favor of plaintiff and against defendant, for the outstanding principal due on the loan along
entering final judgment in the amount of with interest accumulated to date. On November
$81,344.12 plus interest. Defendant then filed this 14, 2007, plaintiff filed an amended complaint that
appeal, claiming that plaintiffs complaint was time stated the same allegations as the first complaint
barred under any of three applicable statutes of and added a calculation showing that the sum of

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 Kranzler v. Saltzman 407 Ill. App. 3d 24 (Ill. App. Ct. 2011)

the outstanding principal balance on the SPI and that he had directed SPI to make the 15
"promissory note," plus all interest due and owing, payments to plaintiff in partial repayment of the
totaled $160,241.38 as of October 31, 2007. loan.

When defendant failed to respond to plaintiffs On September 24, 2008, plaintiff moved for
amended complaint, plaintiff sought entry of a summary judgment, alleging that defendant owed
default judgment against defendant, which the trial him $115,797.65 plus per diem interest. The trial
court entered in favor of plaintiff on January 16, court entered partial summary judgment on the
2008, in the amount of $113,692.14. Defendant issue of liability in favor of plaintiff on December
moved to vacate the default judgment within 30 5, 2008, and set a hearing to determine the amount
days of the entry of default, and the trial court of interest owed.
granted defendant's motion to vacate on March 13,
On January 27, 2009, the trial court entered a
2008.
judgment against defendant and in favor of
On the same date, defendant moved for a plaintiff in the amount of $81,344.12. The
judgment on the pleadings pursuant to section 2- decision also called for postjudgment interest to
615(e) of the Code of Civil Procedure ( 735 ILCS accrue at the rate of 9% per annum. Defendant
5/2-615(e) (West 2008)), alleging that plaintiffs then filed this timely appeal.
action was time barred by the statute of limitations
provided by article III of the Uniform Commercial ANALYSIS
Code ( 810 ILCS 5/3-101 et seq. (West 2008)) as Defendant appeals from the trial court's judgment
well as the 10-year statute of limitations for in favor of plaintiff and contends that the trial
written contracts under section 13-206 of the Code court erred in refusing to dismiss plaintiffs second
of Civil Procedure ( 735 ILCS 5/13-206 (West amended complaint. We are not persuaded that the
2008)). The trial court denied defendant's motion trial court erred.
on May 1, 2008, and allowed plaintiff to file a
First, we have considered which statute of
second amended complaint.
limitations applies in the instant case. The parties
Plaintiff filed his second amended complaint on point to three different statutes of limitations in
May 1, 2008. It reiterated plaintiffs allegations in their briefs: 3 years for actions arising under
the two preceding complaints and enumerated 15 article III of the Uniform Commercial Code ( 810
separate payments that were made on the loan ILCS 5/3-118(g) (West 2008)), 5 years for actions
between November 30, 1999, and July 5, 2005. on unwritten contracts and "all civil actions not
Exhibit B to plaintiffs second amended complaint otherwise provided for" ( 735 ILCS 5/13-205
27 included excerpts from a deposition taken of *27 (West 2008)), and 10 years for written contracts or
defendant in an unrelated matter in which "other evidences of indebtedness in writing" ( 735
defendant admitted that plaintiff had loaned him ILCS 5/13-206 (West 2008)). The parties agreed
$100,000 and that he had requested that his during oral argument that the article III statute of
company, Saltzman Printers, Inc. (SPI), make limitations cannot apply because the document at
payments on the loan. In his answers to plaintiffs issue here does not meet the requirements of a
second amended complaint, defendant admitted negotiable instrument. Defendant contends that the
that the 15 enumerated payments were made on document was not a written contract and thus falls
the loan. In addition, in his response to plaintiffs under the five-year statute of limitations for
first request for admissions, defendant admitted unwritten contracts. 735 ILCS 5/13-205 (West
that he was president, director, and shareholder of 2008). Plaintiff responds that the instrument
contains all essential terms of a promise to pay
and thus qualifies for the 10-year statute of

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 Kranzler v. Saltzman 407 Ill. App. 3d 24 (Ill. App. Ct. 2011)

limitations under section 13-206 ( 735 ILCS 5/13- holder agreement between defendant and the
206 (West 2008)). Which statute of limitations issuing bank of the credit card, and thus, parol
applies is a question of law that we review de evidence was necessary to show the essential
novo. Travelers Casualty Surety Co. v. Bowman, terms and conditions of that contract as well as the
28 229 Ill. 2d 461, 466 (2008). *28 relationship between the parties and the
defendant's receipt and acceptance of those
We must first determine whether the document is
essential terms); Held v. Held, 137 F.3d 998, 1000
merely a partial writing evidencing an oral
(7th Cir. 1998) (finding that a written letter
agreement or a complete writing containing all
submitted as evidence of an express trust was not
essential terms. Where the writings attached to the
"other evidence of indebtedness" because it did
complaint do not contain the essential terms of the
not contain all of the essential elements of a trust
contract, even if the essential terms may be easily
agreement).
ascertained elsewhere, the contract is not written
but oral. Clark v. Western Union Telegraph Co., The essential elements or terms of a promise to
141 Ill. App. 3d 174, 176 (1986). But a writing is pay are: (1) the parties to the agreement, (2) the
complete "when the language of the instrument nature of the transaction, (3) the amount in
may fairly be construed to contain a promise to question, and (4) at least a reasonable implication
pay money or contains facts from which the law of an intention to repay the debt. In re Estate of
implies a promise to pay, so long as parol evidence Garrett, 24 Ill. App. 3d at 898. In Garrett, the
is not necessary to establish any essential Second District considered an instrument similar
elements." Toth v. Mansell, 207 Ill. App. 3d 665, to the one at issue here. There the parties disputed
670 (1990) (finding that invoices, monthly whether a handwritten note discovered in the
statements, and ledgers did not constitute "`other decedent's safety deposit box constituted written
evidence of indebtedness`" because they could not evidence of an oral contract or "`other evidence of
establish the essential element of a promise to 29 *29 indebtedness.`" Garrett, 24 Ill. App. 3d at 897.
pay). When that writing is not simply a contract One side of the piece of paper showed a paid
but also a promise to pay, then the writing promissory note in the amount of $5,000 and the
constitutes "`other evidence of indebtedness`" for other side held the handwritten note indicating that
the purposes of section 13-206 of the Illinois Code the claimant and a third person had lent decedent
of Civil Procedure. Toth, 207 Ill. App. 3d at 670; the funds to pay the promissory note and that
In re Estate of Garrett, 24 Ill. App. 3d 895, 899 decedent wished to repay the two men out of his
(1975) ("If the language of a writing may fairly be estate. Id. The envelope containing this piece of
construed to contain a promise to pay money, or if paper also bore a note in the decedent's
the instrument states a fact from which the law handwriting indicating that he owed the claimant
implies an obligation to pay and there is no need and the third party each $2,500. Id. On appeal, the
to resort to parol evidence in order to establish any court concluded that the notes did not constitute a
essential elements of the agreement forming the written contract because they lacked mutuality;
basis of the action, the instrument is within there was no evidence that the claimant had
[section 13-206 ( 735 ILCS 5/13-206 (West known of their existence prior to the death of the
2008))] founded upon `evidences of indebtedness decedent. Id. at 898.
in writing.' "); see also Portfolio Acquisitions,
However, the Garrett court found that "being of a
L.L.C. v. Feltman, 391 Ill. App. 3d 642, 652
contractual nature, the writings do constitute
(2009) (determining that a credit card contract was
`other evidences of indebtedness in writing.`" Id.
oral because the plaintiff debt collection agency
The court reasoned:
did not present as evidence a copy of the card-

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 Kranzler v. Saltzman 407 Ill. App. 3d 24 (Ill. App. Ct. 2011)

"Whether an action is based on a written 30 all essential *30 terms. However, defendant cites
contract or on any other evidence of to no cases in support of this argument and we
indebtedness in writing, the action must be have not found any that would bolster his position.
upon the writing and it is not enought [ sic] In addition, defendant contends that it is unclear
that the evidence by which the cause of from the face of the instrument exactly whom he
action is supported is in writing. should repay. This is a spurious argument when
[Citations.] the instrument clearly states the person who
loaned defendant the money, and defendant has
The writings before us are not, however,
not cited to any case law holding otherwise. See
mere evidence of a previous oral
Ill. S. Ct. R. 341(h)(7) (eff. July 1, 2008); Dillon v.
agreement. They are by themselves
Evanston Hospital, 199 Ill. 2d 483, 493 (2002)
complete, thus eliminating the necessity of
("`A court of review is entitled to have the issues
resort to parol evidence. The parties to the
clearly defined and to be cited pertinent authority.
agreement, the nature of the transaction,
A point not argued or supported by citation to
the amount in question and, at least by
relevant authority fails to satisfy the requirements
reasonable implication, an intention to
of Rule 341([h])(7).`").
repay the debt are indicated therein.
Accordingly, the writings come within the Accordingly, we find that the instrument presented
purview of [section 13-206 ( 735 ILCS here constitutes "other evidence of indebtedness in
5/13-206 (West 2008))]." Garrett, 24 Ill. writing" and thus falls within the purview of the
App. 3d at 898. 10-year statute of limitations in section 13-206 of
the Illinois Code of Civil Procedure.
Thus, a written instrument evidencing a promise
to pay qualifies as "other evidence of indebtedness Now we must consider when that 10-year statute
in writing" for purposes of the 10-year statute of of limitations began to run in order to discern
limitations so long as the writing contains all whether the instant action was timely filed.
essential terms of a promise to pay. Id. Defendant contends that the statute of limitations
began to run the first day after the loan was made.
As in Garret, the instrument at the heart of the
Plaintiff argues, on the other hand, that the statute
dispute in the instant case contains all of the
of limitations began to run on the date of the last
essential elements of a promise to pay. First, the
payment made on the debt, and we find plaintiffs
instrument names the parties to the agreement:
argument persuasive here.
plaintiff and defendant. Second, it clearly
establishes the nature of the transaction. Plaintiff Defendant cites to Kozasa v. Guardian Electric
loaned money to defendant. Third, the amount in Manufacturing Co., 99 Ill. App. 3d 669 (1981), for
question is readily apparent: $100,000 plus the proposition that "[a] cause of action accrues
interest. Finally, the instrument contains evidence and the statute of limitations begins to run when a
of the debtor's intent to repay the loan. The creditor may legally demand payment from' a
instrument reads "to be paid back with interest" debtor." Kozasa, 99 Ill. App. 3d at 673. However,
and is signed by defendant, the debtor. At the very Kozasa does not hold that the statute of limitations
least, this is a reasonable implication of begins to run the first day after a debtor makes a
defendant's intent to repay the loan. See id. promise to pay, as defendant argues. Rather, the
court found that when a debtor has been making
Defendant contends that because the rate of
payments on a debt, the statute of limitations
interest is not specified in the instrument, parol
begins to run, not when the debtor threatens to
evidence is required to establish the amount in
stop making payments under the contract, but
question and thus the document does not contain

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 Kranzler v. Saltzman 407 Ill. App. 3d 24 (Ill. App. Ct. 2011)

instead when the next payment becomes due and 2008). Accordingly, when payments have been
remains unpaid. Id. In Kozasa the plaintiff had made on a debt instrument that qualifies as "other
designed a relay used in electrical products and evidence of indebtedness in writing" under section
orally contracted with the defendant, an 13-206, the statute of limitations begins to run
electronics component manufacturer, to arrange from the date of the last payment made, even if 10
for an overseas supplier to manufacture the relays. years had already run on the statute of limitations
Id. at 670-71. The parties entered into their oral by the time of the last payment. See Krajcir v.
agreement on November 16, 1967, and during Egidi, 305 Ill. App. 3d 613, 622 (1999) (finding
December 1969 and January 1970 the defendant that a plaintiff who filed his complaint within 10
unilaterally attempted to alter the terms of the years of the last payment made on a nonnegotiable
deal, culminating with sending the plaintiff a promissory note had timely filed).
"`final check *** under the old arrangement`" on
In the instant case, defendant signed the
January 19, 1970. Id. at 672. During this time, the
instrument on March 10, 1997, but plaintiff did
defendant had been making periodic payments to
not file his complaint until June 29, 2007.
the plaintiff under their oral agreement and only
However, plaintiffs second amended complaint
ceased this practice when it failed to make the
alleges that 15 payments were made on the
31 scheduled February payment. Id. *31 at 674. The
instrument between July 1, 1997, and July 5,
court found that no breach of the contract occurred
2005. Although defendant denies in his briefs on
until defendant failed to make that scheduled
appeal that he ever made such payments or caused
payment and thus the statute of limitations began
them to be made, he admitted in his response to
to run from the time of the breach, which was the
plaintiffs first request for admissions that during
first time that the plaintiff could legally demand
his tenure as president, director, and shareholder
payment from the defendant. Id.
of SPI he caused SPI to make 15 payments on the
Moreover, defendant's argument ignores the instrument between November 30, 1999, and
language of the applicable statute of limitations. September 26, 2003. Any one of these payments
As noted, section 13-206 states, "actions on *** would have been sufficient to trigger a new 10-
other evidences of indebtedness in writing *** year limitations period under section 13-206 and
shall be commenced within 10 years next after the thus we find that plaintiffs complaint was timely
cause of action accrued; but if any payment or new filed.
promise to pay has been made, in writing, on any
*** other written evidence of indebtedness, within CONCLUSION
or after the period of 10 years, then an action may Accordingly, for the foregoing reasons, we affirm
be commenced thereon at any time within 10 years the decision of the circuit court of Cook County.
after the time of such payment or promise to pay."
32 Affirmed. *32
(Emphasis added.) 735 ILCS 5/13-206 (West