                                                                           Digitally signed by
                                                                           Reporter of Decisions
                           Illinois Official Reports                       Reason: I attest to the
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                                                                           of this document
                                  Appellate Court                          Date: 2017.01.18
                                                                           13:38:54 -06'00'




        Board of Managers of the 1120 Club Condominium Ass’n v. 1120 Club, LLC,
                                2016 IL App (1st) 143849



Appellate Court       BOARD OF MANAGERS OF THE 1120 CLUB CONDOMINIUM
Caption               ASSOCIATION, Plaintiff-Appellant, v. 1120 CLUB, LLC, an Illinois
                      Limited Liability Company, and TRAPANI CONSTRUCTION
                      COMPANY, INC., an Illinois Company, Defendants-Appellees,
                      (1120 Club, LLC, Third-Party Plaintiff-Appellant, v. Trapani
                      Construction Company, Inc., Legat Architects, Inc., and The Rise
                      Group,    LLC, Third-Party Defendants-Appellees;           Trapani
                      Construction Company, Inc., Fourth-Party Plaintiff-Appellant, v.
                      MacDonald Construction Services, Inc., Kole Construction Company,
                      Inc., Boyle Construction Company, Inc., Howard Concrete, Streich
                      Corporation, and Stock Building Supply, Inc., Fourth-Party
                      Defendants-Appellees).



District & No.        First District, Third Division
                      Docket Nos. 1-14-3849, 1-14-3953, 1-15-0033 cons.



Filed                 October 26, 2016



Decision Under        Appeal from the Circuit Court of Cook County, No. 12-L-7092; the
Review                Hon. Margaret Brennan, Judge, presiding.



Judgment              Reversed and remanded.
     Counsel on               Figliulo & Silverman, P.C., of Chicago (Michael K. Desmond,
     Appeal                   Gregory L. Stelzer, and Melissa N. Eubanks, of counsel), for
                              appellant.

                              LaBarge, Campbell & Lyon, LLC, of Chicago (Bruce W. Lyon and
                              Kathleen J. Scanlan, of counsel), for appellee Trapani Construction
                              Company, Inc.

                              Cassiday Schade LLP, of Chicago (Joseph A. Giannelli and Michael
                              D. Pisano, of counsel), for appellee Stock Building Supply, Inc.

                              Condon & Cook, LLC, of Chicago (J. Scott Gillman, of counsel), for
                              appellee MacDonald Construction Services, Inc.

                              Law Office of David A. Izzo, of Chicago (Tod H. Rottman, of
                              counsel), for appellee Kole Construction Company, Inc.

                              Esp Kreuzer Cores LLP, of Wheaton (Adam S. Kreuzer and Jeffrey
                              Barger, of counsel), for appellee Boyle Construction Company, Inc.

                              HeplerBroom LLC, of Crystal Lake (Holly C. Whitlock, of counsel),
                              for appellee Howard Concrete.

                              Tribler Orpett & Meyer, PC, of Chicago (Michael J. Meyer and David
                              E. Schroeder, of counsel), for appellee Streich Corporation.



     Panel                    JUSTICE PUCINSKI delivered the judgment of the court, with
                              opinion.
                              Justices Lavin and Cobbs concurred in the judgment and opinion.


                                               OPINION

¶1         This matter arises from claims by the plaintiff, Board of Managers of the 1120 Club
       Condominium Association (Board), that a condominium building developed and sold by
       defendant 1120 Club, LLC (LLC) and built by defendant Trapani Construction Company, Inc.
       (Trapani) suffered from a number of construction defects. In addition to being a direct
       defendant on the claims brought by the Board, Trapani was also a third-party defendant to
       claims brought by the LLC. In turn, in response to the claims brought by both the Board and the
       LLC, Trapani filed third-party and fourth-party claims against various subcontractors. This
       single civil case led to three separate appeals, which were consolidated.

                                                  -2-
¶2       After a somewhat convoluted procedural history, the trial court granted Trapani’s motions
     to dismiss the claims brought against it by the Board and the LLC on the bases that the Board
     had elected to pursue recourse from the LLC and thus could not seek recourse from Trapani
     and that the LLC lacked standing to bring its claims. The grant of these motions resulted in the
     dismissal of Trapani’s claims against the subcontractors. After the trial court entered Illinois
     Supreme Court Rule 304(a) (eff. Feb. 26, 2010) findings on the respective dismissal orders, the
     Board, the LLC, and Trapani brought these consolidated appeals. For the reasons that follow,
     we reverse and remand for further proceedings.

¶3                                         BACKGROUND
¶4       In May 2009, the Board instituted this action by filing suit against the LLC and 1120
     Retail, LLC (Retail). The Board then amended its complaint. The Board’s amended complaint
     alleged that the Board is the governing body of the 1120 Club Condominium development
     located at 1124 Lake Street, Oak Park, Illinois. The Board alleged that residential units and
     common elements of the building were damaged as a result of construction defects, including
     the installation of fiber cement siding rather than brick and architectural stone. The Board
     further alleged that the fiber cement siding was improperly installed and that it warped and/or
     failed, allowing water to penetrate the building, causing extensive damage to the common
     elements and residential units of the building. In addition, the Board alleged that the flashings
     around windows and doors were improperly designed and/or installed, resulting in water
     penetration into the building; mold and mildew infiltration into the residential units and
     common elements of the building; water damage to residential units from the water penetration
     on the fourth and seventh floors; and a lack of proper flashing at certain fourth-floor units and
     on the west wall of the swimming pool.
¶5       Against the LLC, the developer and seller of the development, the amended complaint
     alleged claims of breach of contract, breach of express warranty, consumer fraud, and
     negligent misrepresentation. Against both the LLC and Retail, the Board alleged breach of
     contract and sought an injunction related to the reimbursement of expenses the Board claimed
     it was due from the defendants.
¶6       On March 29, 2011, the LLC filed its third-party complaint against Trapani, alleging that
     Trapani and its subcontractors were responsible for the construction defects alleged by the
     Board. The LLC’s third-party complaint sounded in breach of contract, express
     indemnification, and implied indemnification.
¶7       On May 11, 2011, the LLC filed a petition for Chapter 7 bankruptcy. Thereafter, the instant
     matter was placed on the stay calendar due to the bankruptcy.
¶8       In June 2012, the Board filed a motion seeking to have the case removed from the stay
     calendar on the grounds that the bankruptcy court had modified the stay to allow the Board to
     pursue its claims against the LLC to the extent of the LLC’s available insurance. The trial court
     granted the Board’s motion and removed the matter from the bankruptcy calendar.
¶9       On August 24, 2012, the Board filed its second amended complaint. In the second amended
     complaint, the Board dropped its claims against Retail, thereby removing Retail from this
     action, and instead chose to bring claims against only the LLC and Trapani. More specifically,
     it sounded in claims of breach of contract, breach of express warranty, consumer fraud, and
     negligent misrepresentation against the LLC. Counts VI and VII of the second amended


                                                 -3-
       complaint alleged claims of breach of implied warranty of habitability and breach of implied
       warranty of good workmanship against Trapani.
¶ 10       Trapani moved to dismiss counts VI and VII of the Board’s second amended complaint on
       the grounds that, under the holding of Minton v. Richards Group of Chicago, 116 Ill. App. 3d
       852 (1983), the Board could not directly sue Trapani without first establishing that the LLC
       was insolvent and the Board had no recourse against the LLC. According to Trapani, the Board
       could not clear this procedural hurdle because it was pursuing the LLC’s insurance, indicating
       that the LLC was not insolvent and that the Board had recourse against the LLC. The Board
       refuted these contentions by arguing that the LLC was, in fact, insolvent because the insurance
       proceeds were not property of the bankruptcy estate and because the holding of 1324 W. Pratt
       Condominium Ass’n v. Platt Construction Group, Inc., 404 Ill. App. 3d 611 (2010) (Pratt I),
       permitted a direct action against builders. On April 9, 2013, the trial court denied Trapani’s
       motion to dismiss.
¶ 11       In the meantime, Trapani filed its third-party complaint against subcontractors MacDonald
       Construction Services, Inc., Kole Construction Company, Inc., Boyle Construction Company,
       Inc., Howard Concrete, Streich Corporation, and Stock Building Supply, Inc. (hereafter
       collectively referred to as the subcontractors), which it later amended. Trapani’s first amended
       third-party complaint sought contribution from each of the subcontractors for their portion of
       liability for the damages alleged by the Board. Trapani also brought counts for breach of
       contract, breach of express warranty, breach of implied warranty of workmanship, and breach
       of contract to procure insurance against each of the subcontractors.
¶ 12       Certain subcontractors brought motions to dismiss Trapani’s first amended third-party
       complaint. Some of them argued that it should be dismissed because the Board did not have a
       cause of action against Trapani under Minton. On December 4, 2013, the trial court agreed and
       granted the subcontractors’ motions to dismiss with prejudice based on the Minton arguments.
       The trial court also sua sponte reversed its previous denial of Trapani’s motion to dismiss
       counts VI and VII of the Board’s second amended complaint and entered an order dismissing
       the Board’s claims against Trapani with prejudice. The trial court then dismissed all of the
       other subcontractors with prejudice.
¶ 13       On January 3, 2014, the Board filed a motion to reconsider the trial court’s dismissal of
       counts VI and VII against Trapani. In that motion, the Board argued that it had a claim against
       Trapani independent of Minton and that, even if it did not, the LLC was insolvent, such that the
       Board could pursue Trapani under Minton. Trapani and subcontractor Stock responded to the
       Board’s motion to reconsider, arguing that the trial court’s dismissal was proper because
       Minton did, in fact, govern the Board’s claims against Trapani and the LLC was solvent.
¶ 14       While the parties were briefing the Board’s motion to reconsider, the LLC filed a motion
       requesting that its third-party complaint against Trapani be removed from the bankruptcy
       calendar and reinstated. The trial court granted the LLC’s motion. The LLC then requested
       leave to file an amended third-party complaint. The trial court granted the LLC’s motion and
       also reinstated Trapani’s third-party complaint and converted it to a fourth-party complaint.
       The amended third-party complaint filed by the LLC contained three counts against Trapani
       (breach of contract, express indemnification, and implied indemnification) and a count of
       breach of contract against The Rise Group, LLC (Rise Group), and Legat Architects, Inc.
       (Legat).


                                                  -4-
¶ 15       Legat filed a motion to dismiss the breach of contract claim against it in the LLC’s
       amended third-party complaint arguing that the LLC failed to comply with all of the conditions
       of their contract by failing to attend mediation. Legat also argued that pursuant to the contract
       between Legat and the LLC, the LLC’s exclusive remedy was arbitration. It does not appear
       from the record that Rise Group filed any responsive pleading to the LLC’s amended
       third-party complaint.
¶ 16       On June 17, 2014, the trial court issued its corrected order denying the Board’s motion to
       reconsider. In that order, the trial court explained that by electing to pursue the LLC’s
       insurance proceeds, the Board foreclosed its opportunity to “bridge the lack of privity (under
       Minton)” between the Board and Trapani and to seek recovery from any “down the line”
       contractors. According to the trial court, the matter was one involving an election of remedies,
       as the Board could choose to either recover the LLC’s insurance proceeds or use the Minton
       exception to extract recovery from Trapani.
¶ 17       Trapani moved to dismiss the LLC’s amended third-party complaint on the ground, among
       others, that the LLC lacked standing to bring the suit against Trapani, because upon filing the
       bankruptcy petition, ownership of the claim transferred to the bankruptcy estate and could only
       be pursued by the bankruptcy trustee. Likewise, a number of the subcontractors moved to
       dismiss Trapani’s fourth-party complaint on the same basis, i.e., that the LLC lacked standing
       to pursue its claim against Trapani. The LLC responded to these motions by arguing that it did
       have standing because (1) its claim against Trapani did not belong to the bankruptcy estate
       because it related to insurance proceeds, which were not property of the bankruptcy estate, and
       (2) on September 4, 2014, after Trapani and the subcontractors filed their motions to dismiss,
       the bankruptcy trustee assigned any claims against Trapani in the present matter to the LLC.
¶ 18       On November 13, 2014, the trial court granted Trapani’s motion and dismissed the LLC’s
       amended third-party complaint with prejudice. As a result of the dismissal of the LLC’s
       third-party claims, the trial court also dismissed with prejudice Trapani’s fourth-party
       complaint against the subcontractors. The trial court found Legat’s motion to dismiss to be
       moot given the dismissal of the LLC’s amended third-party complaint with prejudice.
       Although the order does not mention Rise Group specifically, the order’s reference to the
       dismissal of “the entirety of [the LLC’s] amended third-party complaint against all third-party
       defendants with prejudice” indicates that the breach of contract claim against Rise Group was
       also dismissed with prejudice.
¶ 19       The LLC requested leave to file a second amended third-party complaint based on the
       contention that it had standing by way of the bankruptcy trustee’s assignment. On December 3,
       2014, the trial court denied the LLC’s request and instead entered Rule 304(a) findings as to its
       orders dated December 4, 2013; June 17, 2014; November 13, 2014; and December 3, 2014.
¶ 20       The Board, the LLC, and Trapani each filed timely notices of appeal.

¶ 21                                            ANALYSIS
¶ 22                          I. Appeal No. 1-14-3849 (Board v. LLC, et al.)
¶ 23       In its appeal, the Board contends that the trial court erred in dismissing counts VI and VII
       of its second amended complaint by applying the doctrine of election of remedies. According
       to the Board, the method and manner by which the trial court applied the election of remedies
       doctrine constituted reversible error, and even if it did not, the trial court’s dismissal of counts


                                                    -5-
       VI and VII is reversible because the Board has a cause of action against Trapani independent of
       Minton. Because we agree with the Board’s latter contention, we reverse.
¶ 24       An order of dismissal pursuant to section 2-619 of the Code of Civil Procedure (735 ILCS
       5/2-619 (West 2014)) is reviewed de novo. Porter v. Decatur Memorial Hospital, 227 Ill. 2d
       343, 352 (2008). The section 2-619 motion admits as true all well-pleaded facts and all
       reasonable inferences to be drawn from the facts. Id. In addition, all pleadings and supporting
       documents must be construed in the light most favorable to the non-moving party. Id.
¶ 25       The trial court’s order granting Trapani’s motion to dismiss does not explain the trial
       court’s basis for its sudden reversal of its position. In denying the Board’s motion to
       reconsider, however, the trial court concluded that the Board, in electing to pursue the LLC’s
       insurance, foreclosed its opportunity to pursue recovery from “down the line” contractors
       under Minton. Whether this constituted an erroneous application of the election of remedies
       doctrine, as the Board argues, need not be determined here, as the Board’s cause of action
       against Trapani for breach of the implied warranty of habitability lies not under Minton, but
       under Pratt I.
¶ 26       The purpose of the implied warranty of habitability is to protect homeowners from latent
       defects in their homes that affect the habitability of those residences. Board of Directors of
       Bloomfield Club Recreation Ass’n v. The Hoffman Group, Inc., 186 Ill. 2d 419, 424 (1999).
       Three major policy considerations underlie the warranty of habitability: (1) purchasers today
       typically do not have the ability to assess whether the home they purchased contains latent
       defects; (2) in making what is most likely the single biggest investment of their lives,
       purchasers rely upon the honesty and competence of the builder; and (3) if defects exist in the
       home, the cost of repairing those defects should be borne by the builder who caused the defect.
       Pratt I, 404 Ill. App. 3d at 616-17 (citing Bloomfield Club, 186 Ill. 2d at 425, and Redarowicz
       v. Ohlendorf, 92 Ill. 2d 171, 183 (1982)).
¶ 27       To achieve this purpose and serve those policies, the class of potential defendants to a
       claim for breach of the warranty of habitability has been expanded beyond the builder-vendor
       or developer-vendor to include builders who are not involved in the sale of the residence.
       Pratt I, 404 Ill. App. 3d at 617. In Pratt I, the plaintiff condo association filed suit against the
       defendant builder, the developer-vendor, and the roofing subcontractor after the unit owners
       discovered leaks around their windows. Id. at 613-14. Among the claims brought against the
       builder was a claim for breach of the implied warranty of habitability, which the trial court
       dismissed on the basis that it applied only to builder-vendors, i.e., builders that were also
       involved in the sale of the residences. Id. at 614. On appeal, this court reversed, holding that the
       implied warranty of habitability is applicable to builders, regardless of whether the builders
       were involved in the sale of the residence. Id. at 617. We concluded that holding builders
       accountable for the latent defects in homes they build and placing the costs of repairing those
       defects on the builder who created the defects was consistent with the purposes of the implied
       warranty of habitability. Id.
¶ 28       Here, the Board alleged that Trapani, as the general contractor, built the building and
       residences at issue, and we take all well-pled allegations in the Board’s second amended
       complaint as true. See Porter, 227 Ill. 2d at 352. Thus, Pratt I governs the question of whether
       the implied warranty of habitability applies to Trapani. As discussed above, it does.
¶ 29       The trial court appears to have assumed, and Trapani and the subcontractors argue on
       appeal, that the Board’s claims against Trapani are governed by Minton. In Minton, the

                                                    -6-
       warranty of habitability was extended to subcontractors in those situations “where the innocent
       purchaser has no recourse to the builder-vendor and has sustained loss due to the faulty and
       latent defect in their new home caused by the subcontractor.” Minton, 116 Ill. App. 3d at 855.
       We later clarified that to pursue a claim against a subcontractor, the plaintiff must demonstrate
       that the builder-vendor is insolvent (as opposed to showing a lack of recourse against the
       builder-vendor). 1324 W. Pratt Condominium Ass’n v. Platt Construction Group, Inc., 2013 IL
       App (1st) 130744, ¶ 25 (Pratt III).
¶ 30        Trapani and the subcontractors attempt to expand Minton’s application beyond
       subcontractors to all non-vendor contractors by arguing that the Board cannot pursue its claim
       for breach of the warranty of habitability against Trapani because it cannot first show that the
       developer-vendor, the LLC, is insolvent. Yet, the Minton court addressed only subcontractors,
       not builders/general contractors, and we see no reason to expand Minton’s holding in light of
       the existence of Pratt I. When this court determined in Pratt I that the implied warranty of
       habitability applied to builders in general, it did not discuss the holding in Minton, much less
       hold that claims for breach of the implied warranty of habitability against builders are only
       actionable if the developer-vendor (or anyone else “in line” before the builder, for that matter)
       is insolvent. Other than Minton, the parties have not cited, and we have not found, any case law
       that requires a plaintiff to apply the implied warranty of habitability against potential
       defendants in a specific sequence.
¶ 31        Nevertheless, Trapani and the subcontractors contend that Pratt I maintains the insolvency
       requirement of Minton because the developer-vendor (the subcontractors erroneously refer to
       it as the builder-vendor) in that case was involuntarily dissolved prior to suit and, thus, there
       was no recourse against the developer-vendor, allowing the plaintiff to proceed against the
       next in line, the builder. This distinction, however, does not change our analysis. First, as we
       clarified in Pratt III, the relevant inquiry under Minton is insolvency, not availability of
       recourse. Pratt III, 2013 IL App (1st) 130744, ¶ 25. Second, involuntary dissolution is not
       necessarily the same thing as insolvency. Involuntary dissolution may occur under a number of
       circumstances, some of which may or may not include the company’s insolvency. See 805
       ILCS 180/35-1(4) (West 2014). Finally, this Court, in issuing its decision in Pratt I, did not
       consider the developer’s involuntary dissolution or solvency status in reaching the conclusion
       that the implied warranty of habitability applied to the builder. Accordingly, the fact that the
       developer in Pratt I was involuntarily dissolved at the time of suit is a distinction without a
       difference.
¶ 32        As discussed above, the purpose of the warranty of habitability is served by allowing
       plaintiffs to proceed against builders. The conclusion that the developer need not be insolvent
       before a claim for breach of the implied warranty of habitability is brought against the builder
       further serves that purpose, as it is the builder, even more than the developer, that is in a
       position to prevent latent defects and that is most accountable for any defects that might occur.
       To require a plaintiff to first pursue the developer before it can pursue the entity most
       responsible for any defects, simply because the developer was the seller (or extended the
       warranty, as Trapani and the subcontractors refer to it) is untenable.
¶ 33        The subcontractors also argue that if we were to accept the Board’s interpretation of
       Pratt I, plaintiffs would be able to choose between bringing suit against the builder-vendor or
       the general contractor. As a result, the subcontractors contend, the builder-vendor would be
       able to escape liability, despite the fact that it was the entity that extended the warranty to the

                                                    -7-
       buyers. Initially, despite the subcontractors’ contentions to the contrary, the LLC is alleged to
       have been the developer-vendor of the properties at issue, as opposed to the builder-vendor.
       Trapani, although admittedly not a vendor, is alleged to have been hired not only as a general
       contractor, but also to construct the properties at issue, thus making it both a general contractor
       and a builder. Accordingly, the contention that the Board is choosing between a builder-vendor
       and a general contractor in this case is misleading.
¶ 34       The real concern of the subcontractors seems to be in allowing the builder (and, in this
       case, general contractor) to be pursued without vendor status, because the builder did not
       extend the warranty to the purchaser. This concern, however, was already addressed in Pratt I
       when this Court reiterated the Supreme Court’s statements that although the warranty of
       habitability has roots in sale contracts, the warranty exists independently and does not require
       privity of contract. Pratt I, 404 Ill. App. 3d at 617 (citing Redarowicz, 92 Ill. 2d at 183).
       Because the implied warranty of habitability is implied in law and not a product of a
       contractual agreement, to say that the seller “extends” the warranty to the purchaser is a
       misnomer; the law extends the warranty to the purchaser. See Redarowicz, 92 Ill. 2d at 183
       (referring to the implied warranty of habitability as a “judicial innovation that has evolved to
       protect purchasers of new houses upon discovery of latent defects in their homes”).
¶ 35       Because Pratt I permits a plaintiff to pursue a builder for breach of the implied warranty of
       habitability regardless of the solvency status of the developer-vendor and because the holding
       in Minton does not apply in this case, the trial court’s determination that the Board’s pursuit of
       the LLC’s insurance precludes its pursuit of Trapani constituted error and warrants reversal.
       For the same reasons, it is unnecessary to assess whether the trial court’s ruling qualified as a
       proper application of the election of remedies doctrine or to entertain the subcontractors’
       argument that the holding in Minton should be revisited.
¶ 36       It should be noted that although Count VI of the Board’s second amended complaint
       alleged breach of the implied warranty of habitability, count VII alleged breach of the implied
       warranty of good workmanship. The Board requested reversal of the dismissal of both counts
       VI and VII on the same grounds, and the trial court dismissed the two counts for the same
       reasons. Neither Trapani nor the subcontractors objected to this request on the grounds that a
       different analysis applies to the Board’s claim for breach of the implied warranty of good
       workmanship. Rather, Trapani and the subcontractors make no distinction between the two
       counts when arguing that the trial court’s dismissal of the counts should be affirmed.
       Accordingly, any contention that the two counts require separate and distinct analysis is
       waived, and we do not offer any opinion on if and to what extent a claim for breach of implied
       warranty of habitability differs from a claim for breach of implied warranty of good
       workmanship.

¶ 37                         II. Appeal No. 1-14-3953 (LLC v. Trapani, et al.)
¶ 38       In its appeal, the LLC argues that the trial court erred in dismissing its amended third-party
       complaint against Trapani for lack of standing and in denying its motion for leave to file a
       second amended third-party complaint. Because we conclude that the bankruptcy trustee’s
       assignment of the claim against Trapani to the LLC revested the LLC with standing nunc pro
       tunc, we agree with the LLC’s former contention.
¶ 39       Trapani’s Motion to Dismiss did not identify whether it was brought pursuant to section
       2-615 (735 ILCS 5/2-615 (West 2014)) or section 2-619 (735 ILCS 5/2-619 (West 2014)) of

                                                    -8-
       the Code of Civil Procedure. Presumably, Trapani intended to bring its motion pursuant to
       section 2-619, as such is the appropriate vehicle for arguing lack of standing. Glisson v. City of
       Marion, 188 Ill. 2d 211, 220 (1999). Orders dismissing a matter for lack of standing are
       reviewed de novo. Id.
¶ 40       The LLC argues that it did not lack standing to bring its third-party claim against Trapani
       because (1) the insurance proceeds that were sought by the Board were not part of the
       bankruptcy estate and any recovery obtained on the LLC’s amended third-party complaint
       would simply offset the insurance companies’ liability, and (2) even if the insurance proceeds
       were properly considered part of the bankruptcy estate, the bankruptcy trustee abandoned any
       claims it had against Trapani by assigning them to the LLC. Because we agree with the latter,
       we need not address the former.
¶ 41       Although standing is typically determined from the allegations of the complaint on the date
       that suit is commenced (People ex rel. Lee v. Kenroy, Inc., 54 Ill. App. 3d 688, 692 (1977)), if
       a party to a lawsuit files for bankruptcy, that party is divested of standing to pursue the claim
       (see Dailey v. Smith, 292 Ill. App. 3d 22, 25 (1997)), even if suit has already been filed. This is
       because once a bankruptcy action is instituted, all unliquidated lawsuits become part of the
       bankruptcy estate and only the bankruptcy trustee has standing to pursue them. Id. at 25-26. If,
       however, the bankruptcy trustee abandons or assigns property, then the property reverts back
       to the debtor in the same condition as if a bankruptcy trustee had never been appointed. Buller
       v. Buller, 9 Ill. App. 3d 125, 126-27 (1973); see also In re Dewsnup, 908 F.2d 588, 590 (10th
       Cir. 1990) (abandoned property “reverts to the debtor and stands as if no bankruptcy petition
       was filed”); Mason v. Commissioner, 646 F.2d 1309, 1310 (9th Cir. 1980) (“When the court
       grants a trustee’s petition to abandon property in a bankrupt’s estate, any title that was vested
       in the trustee is extinguished, and the title reverts to the bankrupt, nunc pro tunc.”).
¶ 42       It is undisputed that the bankruptcy trustee did not assign the claim against Trapani to the
       LLC until after the LLC had filed its amended third-party complaint. In addressing the effect of
       that subsequent assignment, the trial court stated as follows:
                    “I think the case law—you can’t come back and bring standing into play. You
                can’t—you either have it at the time you file your suit or you don’t. You can’t come
                back and say, well, I have it now so, you know, we’re all good. We can move forward.
                    You didn’t have it. It was a claim of the trustee. The trustee did not file it and
                therefore it’s dismissed.”
       Although this conclusion might be correct in a case where standing is affected by something
       other than bankruptcy, it is not correct where standing was divested due to the filing of
       bankruptcy and the claim is later abandoned or assigned by the trustee. Rather, once a claim is
       assigned back to the debtor by the bankruptcy trustee, standing revests in the debtor, as if the
       debtor had never lost standing in the first place. See Hoth v. Stogsdill, 210 Ill. App. 3d 659, 667
       (1991); see also Morlan v. Universal Guaranty Life Insurance Co., 298 F.3d 609, 617 (7th Cir.
       2002) (“And actually, despite the attention we’ve been paying to getting the sequence [of the
       abandonment versus the filings in the underlying claim] right, the sequence doesn’t matter; for
       when property of the bankrupt is abandoned, the title ‘reverts to the bankrupt, nunc pro tunc, so
       that he is treated as having owned it continuously.’ ” (quoting Wallace v. Lawrence Warehouse
       Co., 338 F.2d 392, 394 n.1 (9th Cir. 1964))).
¶ 43       In Hoth, the plaintiff brought an action for legal malpractice while her bankruptcy action
       was still pending. The defendants moved to dismiss her claim, arguing that the legal

                                                    -9-
       malpractice claim belonged to the bankruptcy estate and that unless and until the bankruptcy
       trustee abandoned the claim, the plaintiff lacked standing to pursue it. Hoth, 210 Ill. App. 3d at
       661. The trial court agreed and dismissed the plaintiff’s action with prejudice. After the trial
       court’s dismissal, the bankruptcy court entered an order authorizing the bankruptcy trustee to
       assign to the plaintiff whatever interest the trustee had in the legal malpractice claim. Relying
       on this order, the plaintiff filed a motion to reconsider in the trial court. After the plaintiff filed
       her motion to reconsider but before the trial court ruled on it, the trustee formally assigned the
       legal malpractice claim to the plaintiff. Nevertheless, the trial court denied the plaintiff’s
       motion to reconsider. Id. at 662.
¶ 44        On appeal, the appellate court reversed the trial court’s dismissal of the plaintiff’s claim. In
       doing so, the court observed that at the hearing on the plaintiff’s motion to reconsider, the
       plaintiff presented to the trial court the bankruptcy court’s order authorizing the assignment of
       the legal malpractice claim. According to the appellate court, that order made clear that the
       plaintiff then had standing to pursue the legal malpractice claim. Id. at 667. Therefore, the trial
       court should have granted the plaintiff’s motion to reconsider and vacated its order dismissing
       the plaintiff’s case. Id. at 668.
¶ 45        Like in Hoth, the amended third-party complaint in this case was filed at a time when the
       LLC arguably lacked standing. Also like in Hoth, the bankruptcy trustee did not assign the
       claim to the LLC until after dismissal proceedings had been instituted. In fact, in Hoth, the
       assignment did not occur until after the plaintiff’s case had already been dismissed with
       prejudice. Nevertheless, upon the assignment from the trustee, the plaintiff in Hoth was
       revested with standing, such that the proper action for the trial court was to vacate its dismissal
       and allow the plaintiff to proceed with her complaint. Likewise, upon being presented with the
       bankruptcy trustee’s assignment of the present claim to the LLC, the proper action for the trial
       court to take was to deny the motion to dismiss and permit the LLC to proceed on its amended
       complaint.
¶ 46        Trapani argues that because the LLC lacked standing at the time it filed its amended
       complaint, the amended complaint is a nullity and never legally in existence, i.e., void
       ab initio. In support of this proposition, Trapani relies on Bavel v. Cavaness, 12 Ill. App. 3d
       633 (1973). That case, however, did not involve a situation where the plaintiff lacked standing
       to file suit, but instead involved a suit filed against the estate of a deceased person, along with
       its executors and heirs. The court concluded that the suit was a nullity because the purported
       defendant—the estate—did not fall within the definition of a “party,” i.e., a natural or artificial
       person who has the capacity to be sued. Id. at 637. In the present case, Trapani does not argue
       that the LLC does not qualify as a “party” or lacks the legal capacity to sue or be sued but
       instead argues only that the LLC lacked standing to pursue the claims found in the amended
       third-party complaint. See generally Aurora Bank FSB v. Perry, 2015 IL App (3d) 130673,
       ¶ 17 (outlining the difference between standing and capacity to sue and be sued). As discussed
       above, even if the LLC lacked standing at the time it filed its amended third-party complaint, it
       regained standing through the bankruptcy trustee’s assignment, and accordingly, the trial court
       should have denied the motion to dismiss.
¶ 47        Because the trial court should not have granted Trapani’s motion to dismiss, there is no
       need for us to address the question of whether the LLC should have been allowed to amend its
       complaint in an attempt to cure the perceived standing defect.


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¶ 48                      III. Appeal No. 1-15-0033 (Trapani v. Subcontractors)
¶ 49       Trapani also appealed from the trial court’s decisions. Trapani’s appeal, however, is not
       based on a claim that the trial court erred in dismissing counts VI and VII of the Board’s
       second amended complaint or the LLC’s amended third-party complaint. Rather, Trapani
       appealed on the basis that if the Board and the LLC are successful in their appeals, Trapani’s
       claims against the subcontractors should be reinstated. Because the resolution of Trapani’s
       appeal depended entirely on the outcome of the Board’s and the LLC’s appeals, the parties
       agreed that no briefing was necessary on Trapani’s appeal.
¶ 50       With respect to Trapani’s third-party claims stemming from the complaint filed by the
       Board, the trial court’s order of December 4, 2013, indicates that Stock, Boyle, and Howard
       were dismissed pursuant to the arguments regarding Minton in Stock’s motion to dismiss
       Trapani’s amended third-party complaint. Then, after sua sponte reversing its previous ruling
       and granting Trapani’s motion to dismiss, the trial court ordered that Trapani and all
       subcontractors be dismissed with prejudice. Presumably, the dismissal of all subcontractors,
       even those who had not filed a motion to dismiss, was a result of the dismissal of the Board’s
       claims against Trapani. Because we have concluded that Minton does not apply to the present
       case and that the dismissal of the Board’s claims against Trapani must be reversed, so too must
       the dismissal of Trapani’s claims against the subcontractors.
¶ 51       Likewise, relying on the dismissal of the LLC’s amended third-party complaint against
       Trapani, the trial court dismissed Trapani’s fourth-party claims against the subcontractors.
       Because we conclude that the trial court’s dismissal of the LLC’s amended third-party
       complaint against Trapani must be reversed, the trial court’s dismissal of Trapani’s
       fourth-party claims against the subcontractors must also be reversed.

¶ 52                                        CONCLUSION
¶ 53        We conclude that the trial court erred in dismissing counts VI and VII of the Board’s
       second amended complaint because the holding in Pratt I permits a plaintiff to bring a claim
       for breach of implied warranty of habitability against a builder absent a showing that the
       developer-vendor is insolvent. We also conclude that the trial court erred in dismissing the
       LLC’s amended third-party complaint because the bankruptcy trustee’s assignment of any
       claims against Trapani cured any lack of standing that might have resulted from the LLC’s
       filing of bankruptcy. Because the dismissals of the claims brought by the Board and the LLC
       must be reversed, so too must the dismissal of Trapani’s fourth-party claims be reversed.
¶ 54        The judgment of the circuit court is reversed, and the matter is remanded to the Circuit
       Court of Cook County for further proceedings consistent with this order.

¶ 55      Reversed and remanded.




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