## Facts

- Robert and Anne Marie Jorgensen, professional homebuilders doing business as Jorgensen Homes, developed a subdivision and built/sold a home to David and Patricia Kleczek.
- The sale contract included an express warranty stating the seller had not received any government-issued notice that the house violated applicable building codes.
- After moving in, the Kleczeks experienced extensive plumbing leaks and other defects.
- The Kleczeks learned the builder installed the plumbing himself and that state inspectors had orally informed him the plumbing needed to be performed by a licensed plumber.
- The Kleczeks sued for common-law fraud, statutory consumer fraud, breach of express warranty, and breach of the implied warranty of habitability.

## Issues

1. Whether a professional builder-seller’s misleading representations and nondisclosures in connection with a home sale support liability under the Illinois Consumer Fraud and Deceptive Business Practices Act.
2. Whether attorney’s fees were properly awarded to the purchasers under the Consumer Fraud Act.
3. Whether the trial court erred by (a) denying punitive damages, (b) denying prejudgment interest, and (c) refusing to modify the rescission judgment to award damages measured by the difference between the rescission amount and the home’s resale price.

## Decision

- The appellate court affirmed the judgment imposing Consumer Fraud Act liability on the builder-sellers.
- The appellate court affirmed the award of attorney’s fees under the Consumer Fraud Act.
- The appellate court left undisturbed the trial court’s finding of breach of the implied warranty of habitability because defendants did not challenge it on appeal.
- The appellate court affirmed in part and vacated in part the rulings on post-judgment remedial issues and remanded for further proceedings concerning aspects of relief following rescission and subsequent sale-related developments.

## Legal Principles

- A professional homebuilder marketing and selling homes to consumers acts in “trade or commerce” and may be liable under the Illinois Consumer Fraud Act for deceptive or misleading practices in connection with the sale.
- Consumer-fraud liability may rest on conduct that is misleading to consumers even if it does not satisfy every element of common-law fraud and even if no formal written notice of a violation was issued.
- When a seller gives contractual assurances of code compliance (or absence of governmental violation notices), failing to disclose contrary oral warnings from inspectors can support a finding of deception.
- Successful Consumer Fraud Act plaintiffs may recover reasonable attorney’s fees under the statute’s fee-shifting provision.
- Rescission is an equitable remedy; converting or materially altering rescission-based relief into a different money-damages measure generally requires appropriate pleadings and proof, and may not be accomplished by post-judgment modification without procedural support.

## Conclusion

The appellate court held that the builder-sellers’ misleading assurances regarding code-compliance issues supported liability under the Illinois Consumer Fraud Act and justified statutory attorney’s fees, while directing further proceedings on parts of the remedial framework after rescission in light of post-judgment developments.


Kleczek v. Jorgensen, 328 Ill. App. 3d 1012, 767 N.E.2d 913 (Ill. App. Ct. 4th Dist. 2002)