Ill. Pattern Jury Instr. (Civil) 700.00

INTRODUCTION

These instructions deal with a cause of action for breach of contract when the plaintiff is

seeking money damages. A cause of action for breach of a construction contract will be covered

by future instructions. Employment contract disputes (including Intentional Interference with

Prospective Economic Advantage , Civil Conspiracy, and Breach of Fiduciary Duty) will be

covered by future instructions. Particularized areas of contract law, such as the Uniform

Commercial Code, warranty, and those with equitable relief such as re scission, reformation, or

specific performance are not specifically covered by these instructions. Modification of these

instructions will be required by court and counsel to instruct the jury on those areas of contract law

not intended to be covered by these instructions.

I. GENERAL CONTRACT LAW

A contract is a promise or set of promises between two or more competent parties,

supported by legal consideration, to do or not to do a particular act and for the breach of which the

law recognizes a remedy. Steinberg v. Chi. Med. Sch., 69 Ill. 2d 320, 371 N.E.2d 634, 639, 13 Ill.

Dec. 699 (1977); Wagner Excello Foods v. Fearn Int’l, Inc., 235 Ill. App. 3d 224, 229, 176 Ill.

Dec. 258, 601 N.E.2d 956 (1st Dist. 1992); White v. Village of Homewood, 256 Ill. App. 3d 354,

356–57, 628 N.E.2d 616, 618, 195 Ill. Dec. 152, 154 (1st Dist. 1993).

The requirements of a valid contract are offer and acceptance, consideration, competent

parties, legal purpose, and, if agreed to by the parties, a written agreement. Lal v. Naffah, 149 Ill.

App. 3d 245, 500 N.E.2d 699, 702, 102 Ill. Dec. 806 (1st Dist. 1986).

A contract may be express or implied. Express contracts are those in which the terms of

the contract are disclosed in the words or writings of the parties. Bull v. Mitchell, 114 Ill. App. 3d

177, 448 N.E.2d 1016, 1023, 70 Ill. Dec. 138 (3d Dist. 1983); Lampe v. Swan Corp., 212 Ill. App.

3d 414, 415, 571 N.E.2d 245, 246, 156 Ill. Dec. 658, 659 (5th Dist. 1991). Implied contracts are

those where the agreement is inferred from the acts or conduct or course of dealings of the

parties. In re Estate of Brumshagen, 27 Ill. App. 2d 14, 169 N.E.2d 112, 116 (2d Dist. 1960); Dallis

v. Don Cunningham & Assocs., 11 F.3d 713, 716 (7th Cir. 1993).

Certain contracts are required by the Statute of Frauds to be in writing. [740 ILCS 80/1,

80/2-formerly Ill.Rev.Stat.1991, ch. 59, § 0.01—which references an agreement to pay the debt of

another; an agreement to sell an interest in land; an agreement made by the executor/administrator

of an estate; an agreement to marry, plus an agreement that cannot be performed within one year

from its making; cf. 810 ILCS 5/2-201, which references an agreement for sale of goods for

$500.00 or more under the Uniform Commercial Code.] Although normally a question of law for

the court, under certain circumstances factual issues relating to the applicability, or the satisfaction

of the requirements, of the Statute of Frauds may be questions for the jury. Gaffney v. McCarron,

45 Ill. App. 3d 944, 360 N.E.2d 508, 509, 4 Ill. Dec. 572 (1st Dist. 1977); Am. Coll. of Surgeons

v. Lumbermens Mut. Cas. Co., 142 Ill. App. 3d 680, 491 N.E.2d 1179, 1191, 96 Ill. Dec. 719 (1st

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Dist. 1986). Otherwise, an oral contract with definite and certain terms is enforceable. Rybak v.

Provenzale, 181 Ill. App. 3d 884, 537 N.E.2d 1321, 1325, 130 Ill. Dec. 852 (2d Dist. 1989); Kemp

v. Bridgestone/Firestone, Inc., 253 Ill. App. 3d 858, 865, 625 N.E.2d 905, 910, 192 Ill. Dec. 750,

755 (4th Dist. 1993).

The burden of proving the existence of a contract rests on the party who seeks enforcement

of the contract. C. Iber & Sons, Inc. v. Grimmett, 108 Ill. App. 2d 443, 248 N.E.2d 131, 133 (3d

Dist. 1969). The plaintiff in a breach of contract action also has the burden of proving all of the

material terms of the contract. Vandevier v. Mulay Plastics, Inc., 135 Ill. App. 3d 787, 90 Ill. Dec.

558, 482 N.E.2d 377, 380 (1st Dist. 1985); DeHeer-Liss v. Friedman, 227 Ill. App. 3d 422, 427,

592 N.E.2d 13, 17, 169 Ill. Dec. 526, 530 (1st Dist. 1991).

If there is no dispute as to the language used by the parties or the facts essential to a

purported contract, the issue of the existence of a contract is a question of law to be decided by the

court. Bank of Benton v. Cogdill, 118 Ill. App. 3d 280, 454 N.E.2d 1120, 1125, 73 Ill. Dec. 871

(5th Dist. 1983); Ogle v. Hotto, 273 Ill. App. 3d 313, 320, 652 N.E.2d 815, 819, 210 Ill. Dec. 13,

17 (5th Dist. 1995). If there is a dispute as to the language used or the facts essential to a purported

contract, the issues of whether a contract exists, the terms of the contract, and the intent of the

parties concerning the contract formation are questions of fact for the jury. In re Estate of Kern,

142 Ill. App. 3d 506, 491 N.E.2d 1275, 1280, 96 Ill. Dec. 815 (1st Dist. 1986); Emmenegger

Constr. Co., Inc. v. King, 103 Ill. App. 3d 423, 431 N.E.2d 738, 742, 59 Ill. Dec. 237 (5th Dist.

1982); Mulliken v. Lewis, 245 Ill. App. 3d 512, 516, 615 N.E.2d 25, 28, 185 Ill. Dec. 730, 733 (4th

Dist. 1993).

II. CONTRACT FORMATION

A. OFFER and ACCEPTANCE

An offer is an act by one person (offeror) that gives to another (offeree) the power to accept

the offer according to its terms. McCarty v. Verson Allsteel Press Co., 89 Ill. App. 3d 498, 411

N.E.2d 936, 942, 943, 44 Ill. Dec. 570 (1st Dist. 1980); In re Marriage of Bennett, 225 Ill. App.

3d 828, 832, 587 N.E.2d 577, 580, 167 Ill. Dec. 308, 311 (4th Dist. 1992). The offer must be

communicated to the offeree. Carroll v. Preferred Risk Ins. Co., 34 Ill.2d 310, 215 N.E.2d 801,

803 (1966). In order to create a contract, the offer must be accepted. Zinni v. Royal Lincoln-

Mercury, Inc., 84 Ill. App. 3d 1093, 406 N.E.2d 212, 214, 40 Ill. Dec. 511 (1st Dist. 1980); Mike

Schlemer, Inc. v. Pulizos, 267 Ill. App. 3d 393, 395, 642 N.E.2d 200, 201, 204 Ill. Dec. 738, 739

(5th Dist. 1994). The acceptance must be communicated to the offeror. Rosin v. First Bank of Oak

Park, 126 Ill. App. 3d 230, 466 N.E.2d 1245, 1249, 81 Ill. Dec. 443 (1st Dist. 1984); Energy

Erectors, Ltd. v. Indus. Comm’n, 230 Ill. App. 3d 158, 162, 595 N.E.2d 641, 644, 172 Ill. Dec. 280,

283 (5th Dist. 1992); Cowger v. Indus. Comm’n, 728 N.E.2d 789, 793, 245 Ill. Dec. 707, 711 (5th

Dist. 2000). The acceptance must comply strictly with the terms of the offer. Anand v. Marple, 167

Ill. App. 3d 918, 522 N.E.2d 281, 283, 118 Ill. Dec. 826 (3d Dist. 1988). Mutuality of assent may

be established by conduct indicating agreement with the terms of the offer, even though subjective

agreement is lacking. In re Marriage of Kloster, 127 Ill. App. 3d 583, 469 N.E.2d 381, 383, 82 Ill.

Dec. 847 (2d Dist. 1984). Objective manifestation of intent, when present, controls the

determination of mutual assent. Only when there is no objective indicia of intent or there is

ambiguity in the description of the subject matter of the bargain, must the subjective intent of the

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parties be considered. Caporale v. Mar Les, Inc., 656 F.2d 242, 244 (7th Cir. 1981). But

see Robbins v. Lynch, 836 F.2d 330, 332 (7th Cir. 1988).

In order to constitute a contract between the parties there must be mutual consent by the

contracting parties on the essential terms and conditions of the subject matter of the contract. Bank

of Marion v. Robert Fritz, Inc., 9 Ill. App. 3d 102, 291 N.E.2d 836, 839, 840 (5th Dist. 1973), aff’d,

57 Ill. 2d 120, 311 N.E.2d 138 (1974). This mutual consent may be gathered from either the

language used by the parties or as manifested by the words and acts of the parties. Artoe v. Cap,

140 Ill. App. 3d 980, 489 N.E.2d 420, 423, 95 Ill. Dec. 199 (1st Dist. 1986). The issue of whether

a contract is ambiguous is a question of law, and once so determined, the trier of fact determines

the intent of the parties. A.W. Wendell & Sons, Inc. v. Qazi, 254 Ill. App. 3d 97, 105, 626 N.E.2d

280, 287, 193 Ill. Dec. 247, 254 (2d Dist. 1993); City of Northlake v. Ill. Fraternal Ord. of Police

Lab. Council, Lodge 18, 333 Ill. App.3d 329, 336. 775 N.E.2d 1013, 1020, 266 Ill. Dec. 941, 948

(1st Dist. 2002); Mayfair Constr. Co. v. Waveland Assocs. Phase 1 Ltd. P ’s h i p, 249 Ill. App. 3d

188, 197, 619 N.E.2d 144, 151, 188 Ill. Dec. 780, 787 (1st Dist. 1993).

B. CONSIDERATION

Consideration is the promise or performance bargained for or given in exchange for the

promise. Traditionally, any act or promise that is of benefit to one party or of detriment to another

party may constitute sufficient consideration. Libertyville Twp. v. Woodbury, 121 Ill. App. 3d 587,

460 N.E.2d 66, 71, 77 Ill. Dec. 270 (2d Dist. 1984); In re Marriage of Bennett , 225 Ill. App. 3d

828, 832, 587 N.E.2d 577, 580, 167 Ill. Dec. 308, 311 (4th Dist. 1992). The essential element of

consideration is a bargained for exchange of promises or performances and may consist of a

promise, act, forbearance, or the creation, modification, or destruction of a legal relation. Martin

v. Fed. Life Ins. Co., 109 Ill. App. 3d 596, 440 N.E.2d 998, 1002, 1003, 65 Ill. Dec. 143 (1st Dist.

1982); Aqua-Aerobic Sys., Inc. v. Ravitts, 166 Ill. App. 3d 168, 172, 520 N.E.2d 67, 70, 117 Ill.

Dec. 77, 78 (2d Dist. 1988). If the requirement of consideration is met (Illinois courts deal with

consideration and refer to its “technical meaning”), there is no additional requirement of a gain or

benefit to the promissor, nor a loss or detriment to the promisee, nor equivalence in values

exchanged, nor “mutuality of obligation.” See Hamilton Bancshares, Inc. v. Leroy, 131 Ill. App.

3d 907, 476 N.E.2d 788, 791, 792, 87 Ill. Dec. 86 (4th Dist. 1985); F. H . Prince & Co. v. Towers

Fin. Corp., 275 Ill. App. 3d 792, 798, 656 N.E.2d 142, 147, 211 Ill. Dec. 950, 955 (1st Dist. 1995).

The issue of whether there is consideration is a question of law for the court. O’Neill v. DeLaney,

92 Ill. App. 3d 292, 415 N.E.2d 1260, 1265, 47 Ill. Dec. 947 (1st Dist. 1980); Lesnik v. Estate of

Lesnik, 82 Ill. App. 3d 1102, 403 N.E.2d 683, 687, 38 Ill. Dec. 452 (1st Dist. 1980); Johnson v.

Johnson, 244 Ill. App. 3d 518, 528, 614 N.E.2d 348, 355, 185 Ill. Dec. 214, 221 (1st Dist. 1993).

C.

COMPETENCY

All parties to a contract must be competent at the time the contract is made. A contract,

other than for necessities, is voidable if one party lacks competency due to minority. Iverson v.

Scholl Inc., 136 Ill. App. 3d 962, 483 N.E.2d 893, 897, 91 Ill. Dec. 407 (1st Dist. 1985); Sheller

by Sheller v. Frank’ s Nursery & Crafts Inc., 957 F. Supp. 150, 153 (N.D. Ill. 1997). A contract is

also voidable if one party is incompetent due to insane delusions or other mental illness. Eubanks

v. Eubanks, 360 Ill. 101, 195 N.E. 521, 526 (1935). The requirements necessary to render a party

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incompetent due to mental illness include that the party must be incapable of comprehending the

nature of the transaction and incapable of protecting his or her own interests plus there must be a

showing of a degree of mental weakness affecting that person ’s ability to comprehend the nature

of the transaction and to protect his or her interest. Estate of Gruske, 179 Ill. App. 3d 675, 534

N.E.2d 692, 695, 128 Ill. Dec. 510 (3d Dist. 1989). Persons of mature age are presumed to be

mentally competent; their incompetence cannot be inferred merely from old age, physical illness,

or defective memory. Impairment of the mind incident to old age and disease will not invalidate a

transaction so long as the person in question was able to comprehend the nature of the transaction

and to protect his or her interest. Estate of Gruske, 179 Ill. App. 3d at 678, 534 N.E.2d at 695, 128

Ill. Dec. at 513.

D. LEGAL PURPOSE

A contract designed to accomplish an unlawful purpose is illegal and void. Merch. Nat’l

Bank of Chi. v. Kolber, 50 Ill. App. 3d 365, 365 N.E.2d 688, 692, 8 Ill. Dec. 450 (1st Dist. 1977)

(agreement to defraud); Am. Buyers Club of Mt. V ernon, Ill., Inc. v. Grayling, 53 Ill. App. 3d 611,

368 N.E.2d 1057, 1059, 11 Ill. Dec. 449 (5th Dist. 1977); Swavely v. Freeway Ford Truck Sales,

Inc., 298 Ill. App. 3d 969, 976, 700 N.E.2d 181, 187, 233 Ill. Dec. 80, 86 (1st Dist. 1998) (contracts

in violation of either federal or Illinois statute); O’Sullivan v. Conrad, 44 Ill. App. 3d 752, 358

N.E.2d 926, 929, 3 Ill. Dec. 383 (5th Dist. 1976) (contract in restraint of trade or profession). A

contract is also void if it violates some public policy. Laughlin v. France, 241 Ill. App. 3d 185, 607

N.E.2d 962, 971, 180 Ill. Dec. 662 (2d Dist. 1993) (contract to make a will); Corti v. Fleisher, 93

Ill. App. 3d 517, 417 N.E.2d 764, 775, 776, 49 Ill. Dec. 74 (1st Dist. 198 1) (agreement between

attorney and former employer to transfer files without client’s permission). Whether a contract is

illegal or violates public policy is a question of law for the court. Huszagh v. City of Oakbrook

Terrace, 41 Ill. 2d 387, 243 N.E.2d 831, 833 (1968).

E. AFFIRMATIVE DEFENSES TO CONTRACT ENFORCEMENT

Affirmative defenses, such as lack of capacity, duress, fraud, misrepresentation, undue

influence, and mistake of fact, all relate to the issue of mutual consent and make a contract

voidable. The burden of pleading and proving such defenses rests on the party asserting them. 735

ILCS 5/2-613(d) (1994); Stoltze v. Stoltze, 393 Ill. 433, 66 N.E.2d 424, 428 (1946).

1. DURESS

Duress exists when a party is compelled to enter into a contract by the wrongful acts or

threats of another under circumstances depriving that party of the exercise of his or her own free

will. First Sec. Bank of Glendale Heights v. Bawoll, 120 Ill. App. 3d 787, 458 N.E.2d 193, 198, 76

Ill. Dec. 54 (2d Dist. 1983); Enslen v. Village of Lombard, 128 Ill. App. 3d 531, 470 N.E.2d 1188,

1190, 83 Ill. Dec. 768 (2d Dist. 1984); Kathy O. v. Counseling & Fam. Servs., 107 Ill. App. 3d 920,

438 N.E.2d 695, 700, 63 Ill. Dec. 764 (3d Dist. 1982). Duress is a question of fact. First Sec. Bank

of Glendale Heights v. Bawoll, 120 Ill. App. 3d 787, 458 N.E.2d 193, 198, 76 Ill. Dec. 54 (2d Dist.

1983). In certain circumstances, the duress may be exerted by one not a party to the

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dispute. Restatement (Second) of Contracts, §§ 175(2) & 177(3); Regenold v. Baby Fold, Inc., 68

Ill. 2d 419, 369 N.E.2d 858, 867, 868, 12 Ill. Dec. 151 (1977).

2. UNDUE INFLUENCE

Undue influence exists when one person wrongfully exercises control over another so as

to substitute that person’s will for the will of the other. Britton v. Esson, 260 Ill. 273, 103 N.E. 218

(1913). In certain circumstances, the undue influence may be exerted by one not a party to the

dispute. Restatement (Second) of Contracts § 177(3). Undue influence cases involve the existence

of a fiduciary relationship (arising as a matter of law or fact) when a special confidence is reposed

in one who in equity and conscience is bound to act in good faith and with due regard to the interest

of the other party. A fiduciary relationship exists as a matter of law between attorney and client,

guardian and ward, principal and agent, and may exist in other cases where one p arty is heavily

dependent upon the advice of another. Carey Elec. Contracting, Inc. v. First Nat’l Bank of Elgin,

74 Ill. App. 3d 233, 392 N.E.2d 759, 763, 30 Ill. Dec. 104 (2d Dist. 1979); Oil Exp. Nat., Inc. v.

Burgstone, 958 F. Supp. 366, 370 (N.D. Ill. 1997). Once a fiduciary relationship has been

established, there is a presumption that any transaction that benefits the dominant party at the

expense of the other party is the result of undue influence. Franciscan Sisters Health Care Corp.

v. Dean, 95 Ill. 2d 452, 448 N.E.2d 872, 69 Ill. Dec. 960 (2nd Dist. 1983); Brown v. Com. Nat’l

Bank of Peoria, 42 Ill. 2d 365, 247 N.E.2d 894, 896 (1969); Turner v. Black, 19 Ill. 2d 296, 166

N.E.2d 588, 593 (1960); Works v. McNeil, 1 Ill. 2d 47, 115 N.E.2d 320, 322 (1953).

3. FRAUD and MISREPRESENTATION

Fraud may be a defense to contract enforcement at the option of the injured party. Grane v.

Grane, 143 Ill. App. 3d 979, 493 N.E.2d 1112, 1116, 98 Ill. Dec. 91 (2d Dist. 1986). In order to

establish fraud by clear and convincing evidence, there must be a showing of a misrepresentation

of a material fact, made for the purpose of inducing the other party to act; it must be known by the

maker to be false, or be made in reckless disregard of its truth or falsity; but it must be reasonable

to have believed it an d it must be relied upon by the other party. Cent . States Joint Bd. v. Cont’l

Assurance Co., 117 Ill. App. 3d 600, 453 N.E.2d 932, 935, 73 Ill. Dec. 107 (1st Dist.

1983); Century Universal Enter., Inc. v. Triana Dev. Corp., 158 Ill. App. 3d 182, 510 N.E.2d 1260,

1271, 110 Ill. Dec. 229 (2d Dist. 1987); Warner v. Lucas, 185 Ill. App. 3d 351, 353, 541 N.E.2d

705, 706, 133 Ill. Dec. 494, 495 (5th Dist. 1989); Regensburger v. China Adoption Consultants,

Ltd., 138 F.3d 1201, 1207 (7th Cir. 1998); Douglass v. Wones, 120 Ill. App. 3d 36, 458 N.E.2d 514,

521, 76 Ill. Dec. 114 (2d Dist. 1983); Gerill Corp. v. Jack L. Hargrove Builders, 128 Ill. 2d 179,

538 N.E.2d 530, 536, 131 Ill. Dec. 155 (1989); City of Chi. v. Mich. Beach Hous. Co-op., 297 Ill.

App. 3d 317, 323, 696 N .E.2d 804, 809, 231 Ill. Dec. 508, 513 (1st Dist. 1998); Buechin v. Ogden

Chrysler-Plymouth, Inc., 159 Ill. App. 3d 237, 511 N.E.2d 1330, 1335, 1336, 111 Ill. Dec. 35 (2d

Dist. 1987); Chapman v. Hosek, 131 Ill. App. 3d 180, 475 N.E.2d 593, 598, 86 Ill. Dec. 379 (1st

Dist. 1985).

Usually there is no misrepresentation of a material fact when the representation relates to

an expression of: (1) opinion [Wilkinson v. Appleton, 28 Ill. 2d 184, 190 N.E.2d 727, 730 (1963)];

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(2) a matter of law [Hooker v. Midland Steel Co., 215 Ill. 444, 448, 74 N.E. 445 (1905)]; or (3) a

statement of value [Johnson v. Miller, 299 Ill. 276, 132 N.E. 490, 492 (1921)].

An innocent misrepresentation of a material fact may serve as a defense to contract

enforcement, provided the fact was relied upon in entering into the contract. Puskar v. Hughes,

179 Ill. App. 3d 522, 533 N.E.2d 962, 966, 127 Ill. Dec. 880 (2d Dist. 1989); Geist v. Lehmann,

19 Ill. App. 3d 557, 312 N.E.2d 42, 45 (2d Dist. 1974).

4. MISTAKE

Under certain circumstances, mistake of fact can provide the basis for equitable relief, such

as rescission or reformation of a contract. Keller v. State Farm Ins. Co., 180 Ill. App. 3d 539, 536

N.E.2d 194, 200, 129 Ill. Dec. 510 (5th Dist. 1989); Village of Oak Park v. Schwerdtner, 288 Ill.

App. 3d 716, 718, 681 N.E.2d 586, 588, 224 Ill. Dec. 271, 273 (1st Dist. 1997); Wil-F re d ’s Inc. v.

Metro. Sanitary Dist. of Greater Chi., 57 Ill. App. 3d 16, 372 N.E.2d 946, 953, 14 Ill. Dec. 667

(1st Dist. 1978); People ex rel. Dep’t of Pub. Works & Bldgs. v. S. E. Nat’l Bank of Chi., 131 Ill.

App. 2d 238, 266 N.E.2d 778, 780 (1st Dist. 1971).

III. PERFORMANCE/BREACH

The rights and remedies of the parties in a suit for breach of contract depend upon 1)

whether the alleged breach was material and, where mutual breaches are alleged, 2) which party

was the first to breach, and 3) whether either party elected to terminate the contract as a result of

the other’s prior material breach. PML Dev. LLC v. Vill. of Hawthorn Woods, 2023 IL 128770.

A. SUBSTANTIAL PERFORMANCE/MATERIAL BREACH

Substantial performance is a necessary element of a breach of contract claim. Id., ¶50.

Therefore, generally, to recover on a breach of contract claim, the claimant must prove that it

substantially performed its part of the contract. Id.

“Substantial performance is the ‘honest and faithful performance of the contract in its

material and substantial parts, with no willful departure from, or omission of, the essential elements

of the contract.’” LB Steel, LLC v. Carle Steel Corp., 2018 IL App (1st) 153501 ¶3, quoting

Doornbos Heating & Air Conditioning, Inc. v. James D. Schlenker, M.D., S.C., 403 Ill. App. 3d

468, 483 (1st Dist. 2010). Whether a party to a contract rendered substantial performance is a

question of fact. W.E. Erickson Constr., Inc. v. Congress-Kenilworth Corp., 115 Ill. 2d 119, 126

(1986); LB Steel, 2018 IL App (1st) 153501 ¶37.

While no Illinois case says so explicitly, it appears that a party has either substantially

performed or is in material breach. LB Steel, 2018 IL App (1st) 153501 ¶¶31-38. In other words,

a party who has not substantially performed under a contract is in material breach. Id.

“Substantial performance is the antithesis of material breach; if it is determined that a breach is

material, or goes to the root or essence of the contract, it follows that substantial performance has

not been rendered, and further performance by the innocent party is excused.” 15 Williston on

Contracts § 44:55 (4th ed. 2014) (footnotes omitted). “A material breach of contract constitutes

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the ‘failure to do an important or substantial undertaking set forth in a contract.’" LB Steel, ¶31,

quoting Mayfair Constr. Co. v. Waveland Assocs. Phase I Ltd. P’ ship, 249 Ill. App. 3d 188, 202-03

(1st Dist. 1993). Whether a material breach of contract has been committed is also a question of

fact. Id.

"‘Under the doctrine of substantial p erformance, a contractor may recover where there has

been substantial performance of a contract even though there may be some omissions and defects

in the contract's performance, as measured by the strict terms of the contract.’" LB Steel, LLC v.

Carlo Steel Corp., 2018 IL App (1st) 153501, ¶37, quoting Nat’l Wrecking Co. v. Midwest Terminal

Corp., 234 I ll. App. 3d 750, 761 (1st Dist. 1992). Where a party has materially breached a contract

and is the first to materially breach, the general rule is that the initial breaching party cannot recover

on a breach of contract claim. PML , ¶50.This is known as the “first to breach rule.” “ The first-to-b reach rule excuses a party's duty to perform under the contract if the other party materially

breaches the agreement first.” Id. “ In other words, the first -to-breach rule excuses the injured

party from future performance and allows the injured party to pursue its breach of contract claims.

Conversely, subject to the below exception the first breaching party cannot seek to enforce the

contract against the injured party.” Id.

B. PARTIAL BREACH RULE -- PML EXCEPTION TO FIRST TO BREACH RULE

In PML, 2023 IL 128770, the Illinois Supreme Court recognized an exception to the first

to breach rule. Where a non- breaching party continues to perform or accepts the benefits of the

contract after and despite the other party's material breach , the nonbreaching party may lose its

right to assert the first-to-breach rule. By continuing the contract, the injured party remains bound

by its obligation to perform. This is referred to as the "partial" breach doctrine , id. ¶51, although

courts recognize the doctrine is “badly named.” Id. (Justice Rochford specially concurring) ;

Emerald Invs. Ltd. P'ship v. Allmerica Fin. Life Ins. & Annuity Co., 516 F.3d 612, 618 (7th Cir.

2008).

Under the partial breach rule, by accepting the continued benefits of the contract, t he

injured party waives its right to declare the contract terminated but does not waive its right to

damages for the first material breach. As performance progresses, the injured party may be come

liable to the first breaching party if the injured party subsequently breaches the contract. PML,

¶¶51-52. Under the “partial” breach rule, "'both parties may be guilty of breaches, each having a

right to damages.'" Id. ¶66, quoting InsureOne Indep. Ins. Agency, LLC v. Hallberg, 2012 IL App

(1st) 092385, ¶ 33. Whether a party has elected to continue performing after and despite a material

breach is a factual question. Id. ¶58.

One implication of PML is that a part y suing for breach has the burden of proving either

that it has substantially performed its obligations or that the opposing party has elected to continue

the contract despite the suing party’s prior material breach.

C. MATERIAL BREACH – RIGHT TO DAMAGES UNDER QUANTUM MERUIT

It should be noted that even a party that has materially breached the contract may be entitled to

recover in quantum meruit from the non- breaching party. LB Steel, ¶39. In such cases, the

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measure of damages is “‘reasonable compensation for value received by the [non-breaching party]

over and above the injury suffered by the [other's] breach.’" Id., quoting Brewer v. Custom

Builders Corp., 42 Ill. App. 3d 668, 673 (5th Dist. 1976). “ The party seeking recovery has the

burden to ‘introduce some evidence specific enough to prove the reasonable value of the benefit

… allegedly received’ by the other party.” Id. , quoting Bernstein & Grazian, P.C. v. Grazian &

Volpe, P.C., 402 Ill. App. 3d 961, 979 (1st Dist. 2010).

Introduction revised November 2025.

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GENERAL NOTES ON USE

The contract instructions assume each of the itemized/numbered paragraphs are at issue in

a case. If an itemized/numbered paragraph is not at issue, it should be eliminated from the

instruction and the corresponding verdict form.

Names may be substituted for party identifiers in the instructions and verdict forms. If the

case includes multiple defendants, they should be identified by name in these instructions, and the

text of the instruction may require additional modification by the court and counsel.

Each issue to be decided by the jury will have a question (found in those instructions with

a “V” in the number) that must be included in the single verdict form to be constructed by court

and counsel. The logical sequence of these instructions should result in a complete general verdict.

The court may consider special interrogatories that are not in conflict with these instructions.

The set of instructions must end with 700.20V.

General Notes on Use approved November 2025.

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