FIRST DIVISION
March 10, 2003

The instant appeal arises from a simple set of undisputedfacts: a plaintiff in a products liability action received anoffer of settlement from the defendant manufacturer, but did notrespond before the defendant prevailed in its motion for summaryjudgment. Since the settlement proposal had contained no timelimit or other conditions for acceptance, the plaintiff notifiedthe defendant that she would take the offer and was promptlyinformed that the offer was no longer open. While the productsliability litigation continued, the plaintiff filed the actionunderlying this matter: a claim against the defendant for breachof the settlement agreement. The question presented for ourreview is whether the plaintiff's promise to settle her lawsuitlost its value, and thus its ability to serve as considerationfor a settlement payment, once the defendant prevailed in itsmotion for summary judgment. The trial court answered thisquestion affirmatively. We disagree and reverse the grant ofsummary judgment in favor of the defendant on the breach ofcontract claim.

Plaintiff Fannie Kalis was injured by the explosion of acontainer of fuel and in December 1995 filed an action in theUnited States District Court which sought damages from thealleged manufacturer, defendant Colgate-Palmolive Company(Colgate). On March 13, 1998, Colgate moved for summaryjudgment. On April 27, 1999, while that motion was pending,Colgate, via letter from its counsel to Kalis's counsel, offered$100,000 to settle the claim. The offer contained noconditions, did not refer to the pending summary judgment motionin any way, and did not purport to expire at any specific time.

On May 10, 1999, the district court granted Colgate'smotion, and on May 14, Kalis's attorney sent defense counsel aletter accepting Colgate's offer. Colgate's May 18 responseadvised Kalis that "the moment the judge ruled summary judgmentin our favor and against the plaintiff, the offer of $100,000 wasno longer valid."

Kalis sought reconsideration of the summary judgment ruling,and when that motion was denied, she appealed. The United StatesCourt of Appeals for the Seventh Circuit heard arguments on thecase in April 2000 and affirmed the judgment in Colgate's favoron November 3, 2000.

On the same date she filed notice of her appeal of thesummary judgment on her products liability claim, Kalis alsofiled in the circuit court of Cook County the action underlyingthe instant case: she alleged that Colgate's offer and heracceptance combined to create a binding agreement to settle herclaim for $100,000.

Kalis and Colgate both moved for summary judgment: Kalisalleging that the formation of a contract and Colgate'ssubsequent breach were undisputed; Colgate contending that shehad no consideration to offer for a settlement agreement afterthe summary judgment ruling and that an implied condition of itsoffer was that it be accepted before the motion was decided. Thetrial court agreed with Colgate, ruled that there was noconsideration for the settlement agreement, and granted summaryjudgment in favor of the company. In our view, establishedprinciples of contract law dictate the opposite conclusion.

Any act or promise that benefits one party or disadvantagesthe other is sufficient consideration to support the formation ofa contract. Steinberg v. Chicago Medical School, 69 Ill. 2d 320,330 (1977). A promise to forego pursuit of a legal claim will bedetermined to be adequate consideration to support formation of acontract even if the claim is invalid, provided that it isasserted in good faith. Keller v. State Farm Insurance Co., 180Ill. App. 3d 539, 546 (1989).

Such forbearance provides consideration sufficient tosupport the formation of a contract even if, at the time of thepromise, a court has already found the claim to be without merit. "The fact that a lower court has decided against the claim, orthat a court has held adversely to it in a suit to which theclaimant was not a party, does not prevent the forbearance topress a claim from being consideration." 2 J. Perillo & H.Bender, Corbin on Contracts,