A panel of leading appellate lawyers reflect on today's Illinois Supreme Court opinions in civil cases West American Insurance v. Yorkville National Bank, Hurlbert v. Charles, Hubble v. Bi-State Development Agency, K. Miller Contruction Company Inc. v. McGinnis and Irwin Industrial Tool Co. v. The Department of Revenue and criminal cases People v. Miller and People v. Clendenin.

CIVIL

West American Insurance v. Yorkville National Bank

By Michael T. Reagan, Herbolsheimer Lannon Henson Duncan and Reagan PC In West American Ins. Co. v. Yorkville National Bank the issue was the effect to be given to an insurer’s possible “actual notice” of a lawsuit, when written notice was not given for 27 months after filing. The policy required “written notice of the claim or suit as soon as practicable.” The lead opinion in the appellate court stated that the case law was in conflict and that the matter needed to be resolved by the supreme court.  There was a dissent. The supreme court’s opinion did not take up a conflict in the case law, but rather regarded the problem to be simply a manifest weight analysis of the reasonableness of the notice under the factors identified in Country Mutual Ins. Co. v. Livorsi Marine, Inc., 222 Ill.2d 303 (2006). The pivot point of the decision appears to be the supreme court’s statement that the factual question of whether “actual notice” had been orally given was not irrelevant, as the appellate court had held, but rather was relevant to the prejudice factor. Justice Freeman filed a dissent, stating that the insured had breached every reporting obligation it had agreed to in the policy. He also expressed concern that Cincinnati Companies v. West American Ins. Co., 183 Ill.2d 317 (1998) had been extended beyond its facts, where notice provisions were not at issue. Case summary Opinion 108285

Hurlbert v. Charles

By Tim Eaton, Shefsky & Froelich Ltd. After Plaintiff was arrested for a DUI, he filed a petition to rescind the statutory summary suspension of his driver’s license. After both the Plaintiff and arresting officer testified at the summary suspension hearing, the court denied plaintiff’s petition finding that there was probable cause for the DUI arrest. Plaintiff’s DUI charge was later dismissed. Plaintiff filed a malicious prosecution case against the arresting officer and the City. To prove a malicious prosecution cause of action, plaintiff must show there was an absence of probable cause for prosecuting him. Both the trial court and appellate court found that the probable cause determination at the summary suspension hearing collaterally stopped plaintiff from bringing his malicious prosecution case, and therefore entered summary judgment in favor of the defendants. The Supreme Court reversed finding that the purpose of the summary suspension hearing is intended to be a “summary” procedure where even police reports instead of live testimony may be admitted, and therefore a finding at such a hearing should not be given preclusive effect, even on a case-by-case basis, in later criminal or civil proceedings. The court was concerned that if the summary proceeding were to be given preclusive effect in the future, then the parties would fully litigate issues at those proceedings defeating the purpose of their summary nature. Case summary Opinion No. 109041

Hubble v. Bi-State Development Agency of the Illinois-Missouri Metropolitan District

By Jean M. Prendergast, Schuyler, Roche & Crisham, P.C In Hubble v. Bi-State Development Agency of the Illinois-Missouri Metropolitan Dist., the Illinois Supreme Court reversed a divided appellate panel, and unanimously ruled that Bi-State Development Agency of the Illinois-Missouri Metropolitan District (“Bi-State”) is a “local public entity” under the Local Governmental and Governmental Employees Tort Immunity Act (“Act”) (745 ILCS 10/1-101 et seq. (West 2006)). Thus, the Act’s one-year statute of limitations bars plaintiff’s 2007 tort action arising from on a 2005 collision with a Bi-State bus. Bi-State is a corporation created pursuant to the compact clause of the United States Constitution by a congressionally approved interstate agreement between Illinois and Missouri.  Bi-State exists solely to provide mass public transportation in parts of Missouri and Illinois. Bi-State is publicly funded and operates for the public interest. The Court concluded that Bi-State qualifies as a local public entity under section 1-206 of the Act because it is a not-for-profit corporation organized for the purpose of conducting public business. 745 ILCS 10/1-206 (West 2006). The Court agreed with an earlier, similar appellate decision, Grady v. Bi-State Development Agency, 151 Ill.App.3d 748, 750 (1986). The Court applied principles of statutory construction and concluded that the six legislative amendments to section1-206 since Grady, without alteration as to Bi-State, evidenced legislative acquiescence in Grady’s holding. The Court further found that the Act protects, rather than burdens, the compact between Illinois, Missouri and Congress. While governmental practitioners surely will take interest in Hubble, several wrinkles may pique the interest of appellate lawyers.  First, the high court used its supervisory authority to direct the circuit court to grant Bi-State’s motion to certify a question for review under Supreme Court Rule 308 and to stay proceedings. A divided appellate panel answered the question in favor of plaintiff, but granted Bi-State’s application for a certificate of importance under Supreme Court Rule 316 and Article VI, Section 4(c) of the Illinois Constitution of 1970. The appellate court characterized the certificate of importance as covering the certified question of law under Rule 308. The high court clarified that Rule 316 allows the Court to review the entire case, not just one issue. Ultimately, the Court directed the dismissal of the untimely complaint on remand. Case summary Opinion No. 109137

K. Miller Construction Company Inc. v. McGinnis

By Michael T. Reagan, Herbolsheimer Lannon Henson Duncan and Reagan PC The Home Repair and Remodeling Act (815 ILCS 513/15 et seq.) provided that it was “unlawful for any person engaged in the business of home repairs and remodeling to remodel or make repairs or charge … before obtaining a signed contract….”  The questions of whether contractors could recover upon oral contracts, enforce mechanics liens, or recover in quantum meruit generated a number of appellate decisions, as well as colorful statements by the appellate court.  (K. Miller Construction Co., 394 Ill.App.3d 248 (2009) (“No clear and plain intent in the Act to do away with quantum meruit, an equitable remedy that is a part of our common law going back to the times when Abraham Lincoln practiced in our courts.” Garcia, J.;  "An act declared unlawful ....(cannot) be sanitized by filtering it through a court of equity." Wolfson, J., dissenting); Fandel v. Allen, 398 Ill.App.3d 177 (2010) (“It was not the legislature that said any violation of the Home Repair Act ipso facto renders the contract unenforceable; it was some judges.”Schmidt, J.)) The appellate court had held that the oral contract, made by a practicing real estate attorney, could not be enforced, but that the contractor could recover in quantum meruit.  The supreme court holds that the contractor can potentially recover on both theories.  The supreme court reasoned that where a contractual term violates a statute, the term is not categorically unenforceable, but that rather the court must engage in a balancing process, where the statute is silent as to the effect to be accorded to the statutory violation. The court noted that in this case it did not need to remand to the appellate court for that balancing process, or even perform the balancing analysis itself because an amendment to the statute after the issuance of the appellate decision clarified legislative intent.  The court looked to the conflicting appellate decisions for the conclusion that “there was no clear interpretation of the law to be changed.”  The court concluded that the statutory change removing all references to the word “unlawful” was intended to clarify, rather than change, the law. The disputes in this area will now erupt under the aegis of the Consumer Fraud Act, because of the amendments. This opinion contains the procedural nugget that an affirmative defense may be raised by a Section 2-615 motion where the defense is established by the facts on the face of the complaint, rather than being necessarily relegated to a Section 2-619(a)(9) motion which “speaks in terms of affirmative matter, not affirmative defenses.” Case summary Opinion No. 109156

Irwin Industrial Tool Co. v. The Department of Revenue

By Tim Eaton, Shefsky & Froelich Ltd. The Illinois use tax is a tax imposed on tangible personal property purchased at retail outside of the state when it is used substantially in Illinois and where no sales tax had been paid in this state.  The tax is a way to prevent avoidance of the Illinois Retailers Occupation Tax Act, which is Illinois’ primary means of taxing the retail sale of tangible personal property. This case involved an out-of-state purchase of an airplane by a company which although based in Nebraska had a corporate presence in Illinois, and its subsidiary which owned the plane had an address in Illinois.  The plane was frequently used to transport a majority of the officers of the Nebraska company (who were Illinois residents) to other locations.  Based upon the specific facts of this case, the supreme court found that there was a “substantial nexus” to this state which is required before the state can impose a tax on the use of tangible personal property.  The court also affirmed the Department of Revenue’s imposition of a tax on the full purchase price of the airplane, because in this case no sales tax had been paid in any state by the owners of the airplane so no credits for other taxes paid was a consideration. Case summary Opinion No. 109300

CRIMINAL

People v. Miller

By Kerry J. Bryson, Office of the State Appellate Defender This case presented the Court with the “first occasion...to consider, with the benefit of briefing and argument, which approach should be applied under the one-act, one-crime doctrine to determine whether one offense is a lesser included offense of another.”  When presented with a one-act, one-crime challenge, a court should apply the abstract elements approach. Under that approach, the court looks to the statutory elements of the offenses at issue and determines whether all of the elements of one are included in the elements of the other. Applying that approach to the instant case, retail theft was not a lesser included offense of burglary because burglary does not require a “taking,” but retail theft does.  The Court also noted that the “requisite intents” of burglary and retail theft are different. While the question was not squarely presented here, the Court plainly indicated that the charging instrument approach would still be applied when determining whether one offense is a lesser included of another for purposes of jury instructions and convictions of uncharged crimes.  Such an approach is warranted because of notice requirements that are not implicated in one-act, one-crime cases. Ultimately, this decision affirms the Court’s continued adherence to the one-act, one-crime doctrine and crystallizes for practitioners and courts how that doctrine is to be applied. Case summary Opinion No. 107878

People v. Clendenin

By Kerry J. Bryson, Office of the State Appellate Defender Following denial of a motion to quash arrest and suppress evidence, this case proceeded to a stipulated bench trial. Defendant indicated in open court that he agreed to proceed by stipulation. The stipulation preserved the suppression issue and specifically indicated that defendant was not stipulating to the sufficiency of the evidence to convict. The Court discussed and affirmed several of its recent decisions (Campbell, Phillips, and Rowell) holding that defense counsel generally may waive a defendant’s confrontation rights by entering into a stipulation without confirming that defendant is aware of the specific contents of the stipulation so long as the stipulation is part of a reasonable trial strategy and defendant does not object. Departure from that general rule is warranted only where the stipulation is tantamount to a guilty plea, specifically where: (1) the State’s entire case is presented by stipulation and defendant fails to preserve a defense; or (2) the stipulation concedes the sufficiency of the evidence. The court affirmed that there are no other restrictions to counsel’s authority to stipulate to the admission of evidence, and no obligation on the court to admonish defendant about such a stipulation. Case summary Opinion No. 109184

In re Veronica C., a Minor

The Supreme Court found that the minor lacked standing to challenge the statute. Case summary Opinion No. 108953