JUSTICE BARRY delivered the opinion of the court:
It appears that G. Larson & Sons Farms, Inc. (Larson), a family-owned farming corporation, executed various promissory notes in favor of the Kewanee Protection Credit Association (PCA) for loans which were secured by various farm assets, including the corporation's crops, livestock, stored grain and feed, and certain farming equipment. By November 1981, Larson was in default on its loans.
On November 16, 1981, plaintiff, PCA, obtained judgment by confession against defendant, Larson, in the amount of $389,043.77 plus $40,000 in attorney fees. Larson filed a timely "Motion to Open Judgment by Confession" in the circuit court of Henry County, together with an answer to the plaintiff's complaint and a "Petition for Temporary Restraining Order and Injunction." The TRO was granted pending a hearing on the motion to open judgment.
When PCA obtained its judgment by confession, Larson's crops were still standing in the fields. Larson had exhausted its finances and was searching for another lending agency to refinance its obligations to the PCA and proceed with farming operations. Larson entered into a liquidation agreement with PCA to permit the PCA to
The date set for Larson's closing of the loan agreement with ITT Thorpe was December 23, 1981. By stipulation of the parties, a hearing on defendant's motion to open judgment had previously been scheduled to be heard on December 30, 1981. On December 21, 1981, defendant petitioned the court for an order directing plaintiff to issue a release of its judgment upon defendant's payment of $389,043.77 and defendant's depositing of $40,000 in escrow pending resolution of the issue of attorney fees. The petition was set down for a hearing on December 23 to coincide with the loan closing.
ITT Thorpe's attorney from Wisconsin appeared on that date at the Henry County courthouse, as did representatives of the money-brokerage firm, Credit Pac, that had directed Larson to ITT Thorpe. The Larson family appeared with counsel, as did representatives of the PCA and their attorney. Attorney Kurt Horbert also attended for the purpose of assisting the Larsons in resolving their disputes over attorney fees.
The Larsons' dilemma was discussed in the chambers of Judge Conway Spanton. The Larsons were faced with three options. They could: (1) insist on a full hearing on the motion to open judgment, which was scheduled to be heard on December 30; (2) agree to pay the principal and interest pursuant to the judgment, forego any claim for damages to its land, and place $40,000 in escrow pending a hearing on the reasonableness of the fees; or (3) pay off the PCA in full in exchange for a release in satisfaction of the judgment. The PCA would not agree to release Larson from the judgment while litigation arising out of the underlying debt continued. Moreover, the court made it clear to the Larsons that any claim for damages caused to the
Ultimately, after hours of discussion, defendants, Larsons, elected to proceed with the third option, contrary to the advice of their attorneys. Larson closed the refinancing deal with ITT Thorpe, paid the total claimed, $429,043.77, to the PCA and received PCA's release on the confession of judgment. The Larsons acknowledged the corporate decision in open court and the fact that the corporation was proceeding contrary to its lawyers' advice. Upon receipt of PCA's release, the court, on its own motion, entered an order vacating judgment and dismissing the cause of action.
On January 22, 1982, defendant filed a motion to vacate the order of dismissal pursuant to former section 68.3 of the Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, par. 68.3 (now Ill. Rev. Stat. 1985, ch. 110, par. 2-1203). The motion was not heard until October 28, 1985.
Larson, through its attorney, argued that the 1981 suit should be reopened because its decision to forego a hearing on the reasonableness of the $40,000 in attorney fees was the product of economic duress. After hearing the testimony of attorneys Keith Luymer and James Nash, who represented PCA and Larson, respectively, on December 23, 1981, and Dennis Larson, vice-president of Larson, the court denied defendant's motion to vacate.
In this appeal, Larson contends that it is entitled to a hearing on the reasonableness of the attorney fees as a matter of law and that the trial court erred in concluding that defendant's evidence did not prove a prima facie case of economic duress. We initially consider whether the trial court abused its discretion in denying defendant's motion to vacate. Abbey Plumbing & Heating, Inc. v. Brown (1977), 47 Ill.App.3d 719, 365 N.E.2d 115.
• 1 The elements of economic duress are twofold — "(1) a wrongful act and (2) the absence of the quality of mind essential to the making of a contract." Alexander v. Standard Oil Co. (1981), 97 Ill.App.3d 809, 815, 423 N.E.2d 578, 584.
• 2 Here, as in Alexander, defendant's evidence demonstrates a significant disparity in the parties' bargaining positions, but falls short of showing that plaintiff's use of its superior economic position was in any respect "wrongful." The testimony introduced at the hearing on defendant's motion to vacate fails to confirm Larson's belief that ITT Thorpe would necessarily have backed out of the bailout plan if the closing had been postponed, or that the corporation and the Larson family could not have survived at least another week on what was left of their resources. There was nothing morally or legally wrongful in PCA's insistence that defendant either litigate its dispute or pay off the lender and waive its right to a further hearing before PCA would release Larson from the confessed judgment.
Further, the fact that Larson elected the option of paying its confessed judgment in full contrary to the express advice of its counsel does not, ipso facto, establish that George Larson, Larson's president, was acting so erratically on December 23, 1981, as to now be entitled to avoid or rescind Larson's express waiver of its right to a further hearing on the reasonableness of the $40,000 in attorney fees included
It is clear from the record on appeal that the options open to Larson on that date were extensively discussed among the Larson family members and weighed by them during the course of the day. In hindsight, Larson apparently could have used better judgment in selecting among the available options. We cannot say, however, that the testimony proved that the Larsons' wills were overborne by the situation they faced that day.
We must conclude that the evidence presented in support of Larson's motion to vacate failed to establish a prima facie showing of either of the two elements for a claim of economic duress. On these facts, we cannot say that the trial court's denial of the motion to vacate constitutes an abuse of discretion.
• 3 Having so decided, we must reject as well defendant's argument in the alternative that the court erred as a matter of law in granting attorney fees in the amount of $40,000 without receiving evidence of reasonableness. PCA's complaint for judgment by confession sought attorney fees in the amount of $40,000. That amount was, as aforesaid, approved by the trial court in granting judgment for the PCA on November 16, 1981. Defendant was entitled to a hearing on the reasonableness of the fee award. (Lyons Brothers Lumber & Fuel Co. v. Shepherd (1980), 81 Ill.App.3d 213, 400 N.E.2d 975.) It is a matter of record that defendant knew of its legal right to such hearing. On December 23, 1981, the Larsons expressly waived in open court the corporation's right to the hearing it now seeks. Having waived a known right, defendant may not now attempt to revoke its waiver and revive its rights. Elmore Real Estate Improvement Co. v. Olson (1947), 332 Ill.App. 475, 76 N.E.2d 204.
For these reasons, we affirm the order of the circuit court of Henry County.
SCOTT, P.J., and STOUDER, J., concur.