A state appeals panel says a Cook County judge wrongly allowed Loyola University to move forward with a "one-sided" trial, in which the court ultimately ordered a Chicago restaurant owner to pay more than $500,000 in allegedly past due rent and court costs, even though the restaurant owner's lawyer was hospitalized, amid a fight over whether Loyola legally evicted his new fine dining restaurant from a Loyola-owned building after preventing the restaurant from reopening during the Covid pandemic.
The decision from a three-justice panel of the Illinois First District Appellate Court reversed the decision of Cook County Judge Robert F. Harris.
Harris is on the ballot in the general election on Tuesday, Nov. 5, as he seeks a new term on the bench from Cook County's 5th Judicial Subcircuit. Voters are being asked to "retain" him. If at least 60% of voters vote "Yes," Harris would secure another six year term on the bench.
Michael Olszewski
| Onward Chicago
The appellate decision, issued Oct. 30, comes as the latest twist in a three-year-long legal battle between Loyola and restaurateur Michael Olszewski.
The legal action began in 2021, when Loyola first moved to initiate eviction proceedings against Olszewski and his restaurant, Onward. The restaurant operating company is legally known as Onward MSO LLC.
Olszewski countersued soon after, claiming the university operated in bad faith and moved quickly amid the pandemic to ensure Onward never reopened.
Loyola won a judgment in its favor, taking full possession of the property in May 2023 after apparently winning at trial.
Olszewski, however, has argued the trial was sham and that decision should be tossed.
At the same time, Olszewski has also filed his own lawsuit against the university separately, claiming Loyola actually owes him as much as $1.5 million to cover the amount Olszewski claims he sunk into the Onward restaurant property, allegedly at Loyola's behest more than six years ago.
Olszewski claims Loyola gave him a raw deal, allegedly enticing him to invest in the property, before shutting the restaurant down, evicting him when he couldn't earn any money to pay rent, and then allegedly refusing to allow him to recover some of his investment.
Loyola, however, claims Olszewski and Onward allegedly cause "problems" for the university "for years."
According to court documents, the Onward restaurant venture launched around 2018. It was the result of efforts by Loyola to recruit Olszewski, a "highly accomplished restaurateur" and a self-proclaimed proud alumnus and donor to Loyola, to open a fine dining restaurant in a hotel building the university owned at the corner of Sheridan Road and Albion Avenue in Chicago's far north Rogers Park neighborhood.
Olszewski has a history of operating restaurants in Chicago, including the former Grace restaurant, which had secured three Michelin stars before closing in 2017 amid a falling out between Olszewski and his chefs, according to published reports.
According to court documents and his statements, at the time Loyola recruited him, Olszewski expressed doubts about the ability of a fine dining establishment to succeed in Rogers Park, far from the Loop and lower income demographics. Olzsweski said he told the university from the beginning that the restaurant needed time to "catch on," given its location.
However, Olszewski and Loyola still entered into business together. Olszewski signed a lease and claims to have sunk more than $1 million of improvements into the space, turning it from a dirt floor and bare walls to the promised white tablecloth upscale dining establishment.
According to court documents filed by Loyola, the lease included "many terms favorable to Onward, including 12 months of rent abatement, an extended term, no personal guaranty despite Onward being a sole member LLC with no other known assets, and a below-market rent."
Olszewski opened the restaurant in early 2019. Olszewski said he had targeted the opening for autumn 2018, hoping to take advantage of the busy holiday dining season. However, he blamed Loyola for allegedly slowing the opening by allegedly failing to "live up to their duties as a landlord."
Olszewski particularly faulted Loyola's refusal to secure the area surrounding the restaurant and to remove graffiti from the restaurant's exterior walls, among other alleged security issues, which he said harmed Onward's "first class, fine dining appearance" and generated complaints from customers.
In that complaint which is still pending, Olszewski claimed "Loyola seemed utterly indifferent to Onward's financial success."
According to court documents, Onward reportedly enjoyed a steady increase in business and traffic until the onset of the Covid pandemic in March 2020, when the restaurant was ordered to close.
As the restaurant eyed a reopening, Loyola initiated eviction proceedings in 2021, and the two sides have been in court ever since, with Olszewski claiming the university never gave him a real chance to recover and simply demanded rent, even though they knew the restaurant had not operated for months.
In its own court filings, Loyola has claimed Olszewski didn't fully pay rent even before the Covid closures.
As Olszewski's lawsuit continued, so, too, has Loyola moved forward with its eviction action and attempt to collect the allegedly owed unpaid rent.
As the university sought to bring the case to trial, Olszewski's lawyer reportedly began experiencing significant health issues, resulting in repeated requests from Olszewski for continuances.
According to court documents, Judge Harris reportedly grew impatient with the repeated continuance requests.
According to court documents, the judge said he "would grant no further continuances and suggested that defendant retain additional or alternate counsel."
According to court documents, Judge Harris stood firm on those decisions concerning continuances, even after Olszewski's lawyer was hospitalized shortly before the trial, which the judge allowed to proceed.
Because the defendant in the case was a corporation, Onward MSO LLC, meaning it must be represented by an attorney in court, Olszewski was not permitted to present his case.
The trial court then entered a directed verdict, requiring Onward MSO LLC and Olszewski, as its principal, to pay Loyola $405,518 in allegedly unpaid rent.
GIven the nature of the trial, Olszewski asked the judge to reconsider the verdict. The judge refused, and then ordered Onward MSO LLC and Olszewski to pay an additional $46,774 in back rent, and attorney fees of $24,000.
Olszewski then appealed, arguing Judge Harris abused his discretion as a judge in moving ahead with the trial knowing Onward MSO LLC would have no way to defend itself.
The appellate court agreed.
"In short, defendant was essentially handcuffed from participating in the trial, leading to a one-sided presentation to the jury which almost inevitably led to a directed verdict in plaintiff's (Loyola's) favor," the appellate justices said.
"We recognize that the trial court has the ability to control its own docket, and that the trial court in the instant case was attempting to resolve a matter which had been pending for quite some time, while being cognizant of the fact that plaintiff had received no payment during the pendency of the proceedings.
"We nevertheless must conclude that the trial court's denial of defendant's request for a continuance in this case 'resulted in a palpable injustice,' such that reversal is warranted," they said, citing a 2014 Illinois state appellate court decision.
Noting the eviction has already occurred, the appellate panel said it would not revisit that aspect of the case.
But they said Olszewski and Onward MSO LLC are owed a new trial on how much they may actually owe to Loyola under the circumstances of the case.
The appellate decision was authored by First District Appellate Justice Jesse G. Reyes. Justices Bertina E. Lampkin and LeRoy K. Martin concurred in the ruling.