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Quake Constr., Inc. v. Am. Airlines, Inc. - 181 Ill. App. 3d 908, 130 Ill. Dec. 534, 537 N.E.2d 863 (1989)

Rule:

The determination of the intent of the parties may be a question of law or a question of fact, depending on the language of the writing. If the language of the writing is unambiguous, the construction of the writing is a question of law, and the intention of the parties must be determined solely from the language used. However, if the language is ambiguous, the construction of the writing is a question of fact, and parol evidence is admissible to explain and ascertain what the parties intended.

Facts:

Jones Brothers Construction Corp. (Jones Brothers) submitted a bid on a project, and American Airlines, Inc.'s agent sent a letter of intent notifying Jones Brothers that it had been awarded the contract. The agent later informed Jones Brothers that American Airlines was terminating Jones Brothers’ involvement in the project. Jones Brothers claimed that it was entitled to recover because it had expended funds in preparing to perform and because it had lost its expected profits. American Airlines claimed that the letter of intent was unambiguous and contained a condition precedent that the parties would not be bound until they entered into a formal contract. The Circuit Court of Cook County dismissed the complaint with prejudice, and Jones Brothers appealed.

Issue:

Did the lower court err in dismissing the breach of contract and promissory estoppel claims?

Answer:

Yes

Conclusion:

The court held that the dismissal of the breach of contract and promissory estoppel claims was improper. The court ruled that (1) the letter of intent was ambiguous; (2) there was an issue of fact as to whether the parties intended to be bound under the terms of the letter of intent before they signed a formal contract; and (3) the lower court erred in refusing to consider parol evidence in determining the intent of the parties and in finding as a matter of law that the letter of intent contained a condition precedent.

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