Illinois Association of Defense Trial Counsel Springfield, Illinois | www.iadtc.org | 800-232-0169 IDC Quarterly | Volume 17, Number 4 (17.4.6)
Recent Decisions By: Stacy Dolan Fulco* Cremer, Kopon, Shaughnessy & Spina, LLC Chicago
SERVICE OF PROCESS Attempt At Substitute Service Fails to Satisfy Reasonable Diligence Requirement
In 3M Company v. John J. Moroney Company, 374 Ill. App. 3d 109, 870 N.E.2d 881 (1st Dist. 2007), the plaintiff brought a breach of contract action against the defendant for money the defendant allegedly owed the plaintiff for merchandise. 3M, 870 N.E.2d at 882. The plaintiff used the Cook County Sheriff to attempt service of the complaint on the defendant’s registered agent. This attempt at service was unsuccessful because the registered agent had moved. The return of service the sheriff filed with the clerk of court included what was believed to be the defendant’s new address. Id. After the first attempt at service the plaintiff was given leave to issue an alias summons and serve process on the Secretary of State as provided in the Business Corporation Act. Id. at 883, 805 ILCS 5/5.25 (West 2004). The plaintiff then filed the affidavit of compliance, alias summons and complaint with the Secretary of State and mailed a copy of all documents to the registered agent’s old address. The plaintiff subsequently obtained an ex parte default judgment and award of damages. 3M, 870 N.E.2d at 883. After obtaining the award, the plaintiff filed a citation to discover assets, mailing the notice to the new address provided by the sheriff in the return of service. The defendant then filed a motion to quash service of process, arguing that the plaintiff failed to comply with the Business Corporation Act’s requirements. The trial court granted the motion to quash and vacated the default judgment. The plaintiff appealed, arguing that it exercised reasonable diligence in attempts to serve the defendant, thereby complying with substitute service requirements. Id. Section 5.25(a) of the Business Corporation Act allows service of process on both a corporation’s registered agent or the Secretary of State. 805 ILCS 5/5.25(a) (West 2004). Pursuant to the Business Corporation Act, when the registered agent “cannot with reasonable diligence be found at the registered office,” the Secretary of State is appointed as a corporation’s agent. 805 ILCS 5.25(b)(2) (West 2004). To properly serve a corporation through the Secretary of State, the Act requires two steps. First, the plaintiff must both provide a copy of the process, notice, demand and any other required documents, including an affidavit of compliance, to the Secretary of State. Second, the plaintiff must also send a copy of the above documents by registered or certified mail to both the last registered address on file with the Secretary of State and to the address that the plaintiff knows, “or on the basis of reasonable inquiry, has reason to believe, is most likely to result in actual notice.” 805 ILCS 5.25(c)(2)(ii) (West 2004).
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The appellate court in 3M found that the plaintiff knew or should have known that the new address provided by the sheriff in his return of service would be the address most likely to provide actual service. The appellate court noted that while the plaintiff did not use the new address to serve the complaint prior to obtaining a default judgment, the plaintiff used the new address when it tried to collect the court’s ex parte default judgment award. 3M, 870 N.E.2d at 883-4. The plaintiff relied upon Dutch Farm Meats Inc. v. Horizon Foods, 275 Ill. App. 3d at 326, 655 N.E.2d 1012 (1st Dist. 1995), to support its argument that the circuit court “impermissibly expanded” the reasonable diligence requirement. 3M, 870 N.E.2d at 884. The appellate court agreed that the Business Corporation Act did not require the plaintiff to search for the new address of the registered agent after discovering that the registered agent address on file was not current. However, the appellate court noted, the plaintiff must “reasonably inquire” as to where the defendant will likely receive notice in order to meet the requirements of the statute. Id. The appellate court further distinguished Dutch Farms in that the Dutch Farms defendant had notice of the lawsuit prior to the plaintiff seeking a default judgment. In 3M, however, correspondence sent by the defendant to the plaintiff prior to the entry of the default judgment established that the defendant did not have notice of the lawsuit. As such, the appellate court affirmed the trial court’s ruling quashing the substitute service and vacating the ex parte default judgment and award. Id.
FORUM NON CONVENIENS Public and Private Factors Favored Move to County Where Accident Occurred
In Smith v. Jewel Food Stores, Inc., 374 Ill. App. 3d 31, 870 N.E.2d 970 (1st Dist. 2007), the appellate court affirmed the trial court’s ruling to transfer venue pursuant to the doctrine of forum non conveniens to the county where the incident causing the plaintiff’s death had occurred. In Smith, a driver of a Jewel Food Stores truck struck the car of Shannon Orr on a highway in Kendall County, Illinois. Smith, 870 N.E.2d at 972. Orr died as a result of her injuries. The plaintiff filed her suit in Cook County. The defendants filed a motion to transfer the case to Kendall County pursuant to the doctrine of forum non conveniens. Id. The doctrine of forum non conveniens is an equitable remedy allowing a court to transfer a case to another forum when justice would be better suited by the case proceeding in that forum. Smith, 870 N.E.2d at 973, citing Langenhorst v. Norfolk Southern Ry. Co., 219 Ill.2d 430, 848 N.E.2d 927 (2006). In considering a motion to transfer venue pursuant to the doctrine of forum non conveniens, the circuit court must consider the plaintiff’s choice of forum and both the public and private interest factors established by the Illinois Supreme Court. These factors should be considered without placing undue emphasis on any one single factor. Smith, 870 N.E.2d at 976. The circuit court’s decision should only be reversed on appeal if the circuit court abused its discretion. Id. The appellate court first noted that while the plaintiff’s choice of forum is generally a “substantial factor,” the circuit court correctly afforded less deference to the plaintiff’s choice of forum in this case because the incident did not occur in Cook County and the plaintiff did not reside in Cook County. Id. at 973. The public interest factors to be considered include: “(1) the interest in deciding controversies locally; (2) the unfairness of imposing trial expense and the burden of jury duty on residents of a forum that has little connection to the litigation; and (3) the administrative difficulties presented by adding litigation to already congested dockets.” Id. at 974, citing Langenhorst, 848 N.E.2d 927. The appellate court noted that all three of the public interest factors favored transfer of the matter to Kendall County. Smith, 870 N.E.2d at 974. The Illinois Supreme Court previously held that a county has a “significant interest” in deciding “locally a controversy concerning an automobile
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accident that occurred within its borders.” Id., citing Dawdy v. Union Pacific R. R. Co., 207 Ill.2d 167, 797 N.E.2d 687 (2003). The plaintiff argued that the citizens of Cook County, the plaintiff’s chosen forum, had an interest in deciding the controversy because the defendants did business in Cook County. Smith, 870 N.E.2d at 974. The appellate court cited the Illinois Supreme Court’s decision in Dawdy, which noted that “merely conducting business” in a county did not affect the forum non conveniens analysis. Id., citing Dawdy, 797 N.E.2d 687. As such, the court held that the fact that the defendants conducted business in Cook County was insufficient to favor litigating the matter in Cook County. Next, the appellate court opined that imposing the expense of trial and the burden of jury duty on the citizens of Cook County would be unfair. Smith, 870 N.E.2d at 974. The appellate court also noted that the Cook County docket was more congested than the Kendall County docket, favoring transfer to Kendall County. Id. at 975. The court next considered the private interest factors, which include: “(1) the convenience of the parties; (2) the relative ease of access to sources of testimonial, documentary and real evidence; and (3) all other practical problems that make trial of a case easy, expeditious, and inexpensive.” Id. at 975, citing Langenhorst, 848 N.E.2d 927. The appellate court found that the first factor, convenience of the parties, weighed in favor of transfer to Kendall County. Smith, 870 N.E.2d at 975. The plaintiff resided in Kendall County and the defendant driver lived in nearby Will County. The other driver expected to testify at trial resided in Kendall County. Emergency personnel from Will County responded to the scene and the witnesses to the incident identified by the plaintiff resided closer to the Kendall County courthouse than the Cook County courthouse. Family members of the decedent also lived closer to the Kendall County courthouse than the Cook County courthouse. Id. Additionally, the access to testimonial, documentary and real evidence also favored transfer to Kendall County. Only the employees of the defendants who performed work on the vehicles at issue, and the maintenance and service documents of the defendant’s vehicles, were located in Cook County. The court was not persuaded that the truck involved was stored in Cook County and noted that the ability to view the accident site in Kendall County would be more helpful to the jury in their resolution of the matter than their ability to view the truck. Id. The appellate court noted that it would be irrational to have jurors travel from Cook County to Kendall County to observe the accident site. Id. Finally, the court turned to the final factor, “all other ‘practical problems that make trial of a case easy, expeditious, and inexpensive.’” Id. at 976, citing Langenhorst, 848 N.E.2d 927 quoting First American Bank v. Guerine, 764 N.E.2d 54 (2002). The court noted that although the offices of both the plaintiff’s and defendant’s counsel were located in Cook County, that factor should be afforded “little weight.” Smith, 870 N.E.2d at 976. The appellate court further distinguished the Illinois Supreme Court’s decision in Langenhorst, a case where the litigation was not transferred, based upon several facts. First, the accident site in Langenhorst had substantially changed since the time of the accident, thus making the viewing of the scene irrelevant. Next, the Langenhorst court specifically found that court congestion was not a factor, as docket congestion was in Cook County. Additionally, there was only one eyewitness to the Langenhorst accident, and that witness resided out of state. Id. at 977. Considering all of the public and private interest factors, the appellate court found that the circuit court did not abuse its discretion in balancing the relevant factors and affirmed the circuit court’s decision to transfer the case to Kendall County. Id. at 977-978.
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DISCOVERY Imposition of Sanctions for Failure to Comply With Discovery Orders Upheld
In Teresa Nedzvekas v. Barnett Fung, 2007 WL 1828648, (1st Dist. June 26, 2007), the appellate court considered the plaintiff’s appeal from a circuit court’s order barring the plaintiff from presenting Rule 213(f)(3) expert testimony, barring previously undisclosed Rule 213(f)(2) opinions, and an order granting summary judgment in favor of the defendant. Nedzvekas, 2007 WL 1828648 at *2. The plaintiff originally filed her medical malpractice action against the defendant in 2003. In 2004, new counsel appeared on behalf of the plaintiff. On December 27, 2004, the court ordered the parties to disclose Rule 213(f)(1) and (f)(2) witnesses by January 28, 2005. Id. at *1. On January 28, 2005, the court extended the deadline for disclosing Rule 213(f)(1) and (2) witnesses to February 28, 2005. In addition, the court ordered the plaintiff to disclose Rule 213(f)(3) witnesses by March 7, 2005. The plaintiff failed to comply with this order. The defendant filed a motion to bar the plaintiff’s Rule 213(f)(1) and (2) witness that had not been previously disclosed and to bar all Rule 213(f)(3) witnesses due to the plaintiff’s failure to comply with the prior court order. Id. On June 2, 2005, the plaintiff was given an extension of time to June 9, 2005 to make the required disclosures. The matter was set for a case management conference on June 10, 2005. The plaintiff did not appear at this case management conference and did not make any disclosures as ordered by the June 9, 2005 deadline. On June 10, 2005 the circuit court entered an order barring all previously undisclosed Rule 213(f)(2) witness testimony and all Rule 213(f)(3) witnesses due to the plaintiff’s failure to comply with the court’s orders. Id. The plaintiff filed her Rule 213(f) disclosures on June 17, 2005, disclosing Rule 213(f)(1), (2), and (3) witnesses. The defendant filed a motion for summary judgment on July 18, 2005. Subsequently, the plaintiff filed a motion to vacate the prior barring order. Id. The plaintiff’s motion to vacate the barring order was denied on November 3, 2005. Id. The defendant’s summary judgment motion was granted on December 6, 2005. The circuit court found that the barring order prevented the plaintiff from introducing expert testimony sufficient to prove the defendant deviated from the standard of care and thus the plaintiff would be unable to meet her burden of proof as a result. Id. at *2. On appeal, the plaintiff argued that the circuit court abused its discretion in barring any Rule 213(f)(2) witnesses not previously disclosed and in barring all Rule 213(f)(3) witnesses because the sanction was too severe. The plaintiff also argued that the motion for summary judgment was improperly decided. Id. The appellate court first looked to Illinois Supreme Court Rule 219(c), which provides that it is within the court’s discretion to “prescribe sanctions” when parties fail to comply with discovery orders issued by the court. Id. at *2, 166 Ill.2d R. 219(c). Six factors are to be considered when determining whether sanctions under Rule 219(c) are warranted and what sanctions are appropriate: “(1) the surprise to the adverse party; (2) the prejudicial effect of the witness’ testimony; (3) the nature of the testimony; (4) the diligence of the adverse party; (5) the timeliness of the objection; and (6) the good faith of the party seeking to offer the testimony.” Id. The appellate court first noted that the plaintiff failed to comply with three separate discovery orders. The appellate court further noted that the substance of the plaintiff’s Rule 213(f)(3) disclosure, when finally made in an untimely matter, did not comply with the requirements of the rule. Id. at *3. On appeal, the plaintiff argued that she had trouble arranging a meeting with the controlled expert witness and in obtaining documents requested by the witness for review. While the plaintiff presented this situation upon appeal, the plaintiff admitted that the circuit court had not been advised of her problems in this regard. Id. at *2.
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The appellate court rejected the plaintiff’s argument that the defendant’s failure to “include” a statement that the parties were unable to resolve their differences after consultation pursuant to Illinois Supreme Court Rule 201(k) supported the plaintiff’s claim that the defendant was not diligent in conducting discovery. The appellate court noted that compliance with Rule 201(k) is not at issue when a party disregards a court’s discovery orders. Id. at *3. The appellate court found that the plaintiff’s violation of three discovery orders, coupled with the untimely filing of a disclosure that failed to meet the requirements under the rule, demonstrated a “deliberate and unwarranted disregard of the court’s authority.” As such, the appellate court did not find that the circuit court abused its discretion in issuing the sanction. Id. Next the appellate court considered the plaintiff’s argument that the circuit court’s ruling on summary judgment was in error. Although the plaintiff did not raise the issue with the circuit court, the appellate court considered the issue. Id. at *4. The appellate court found that the plaintiff had previously disclosed one treating physician prior to the June 10, 2005 barring order. The court noted that the plaintiff could rely upon this treating physician to prove her medical negligence action. Id at *4. Finally, the appellate court also found the defendant’s support for his motion for summary judgment insufficient. The defendant’s motion for summary judgment contained no affidavits but only the “bare assertion that because plaintiff was barred from presenting expert testimony at trial, she could not meet her burden of proof.” Id. at *5. When a movant attempts to establish that the opposing party “lacks sufficient evidence to prove an essential element,” the court reminded the defendant, the defendant must do more than point to a lack of evidence. Id. For these reasons the appellate court reversed the order granting summary judgment but upheld the circuit court’s barring order. Id. at *6.
MEDICAL MALPRACTICE Current 725 ILCS 5/2-622 Based Upon Pre-1995 Amendment
In O’Casek v. The Children’s Home and Aid Society of Illinois, 2007 WL 1859185 (4th Dist. June 25, 2007), the plaintiff, mother of the deceased, filed a medical malpractice action against the defendants. O’Casek, 2007 WL 1859185 at *1. The plaintiff’s original complaint was voluntarily dismissed and upon refilling the plaintiff attached an affidavit pursuant to 725 ILCS 5/2-622(a)(2) requesting 90 additional days to file the physician’s report required by statute. Id. The defendant filed a motion to dismiss, arguing that as a result of the Fourth District appellate court’s ruling in Cargill v. Czelatdko, the plaintiff’s affidavit was insufficient because the statute required the affidavit upon refiling to state that the plaintiff had not previously voluntarily dismissed the refiled lawsuit. Id., citing Cargill, 353 Ill.App.3d 654, 818 N.E.2d 898 (4th Dist. 2005). The defendant’s motion was granted. O’Casek, 2007 WL 1859185 at *1. Section 2-622 of the Illinois Code of Civil Procedure addresses certain requirements for filing medical malpractice actions. Section 2-622 was amended in 1995 through Public Act 89-7, known as the Civil Justice Reform Amendments. Id. at *3. The Illinois Supreme Court held the amended Act unconstitutional in 1997 in Best v. Taylor Machine Works. Id., Best, 179 Ill.2d 367, 689 N.E.2d 1057 (1997). As a result, the law was returned to its state prior to the 1995 amendment. In 1998, the legislature adopted Public Act 90-579. Id. Section 5/2-622 was again amended with the enactment of Public Act 94-677 in 2005. Id. at *4. Cargill was decided after the 1998 amendment but before Public Act 94-677 was enacted in 2005. Id. The appellate court first discussed the Cargill ruling in the context of the legislative amendments to 735 ILCS 5/2-622. In Cargill, the court held that the 1998 amendment resurrected language
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contained in the 1995 version, the version that had been previously held unconstitutional by the Illinois Supreme Court in Best. Specifically, the Illinois Appellate Court Fourth District found that the 1998 language required “an affiant requesting a 90-day extension under subsection (a)(2) to state that she had not previously voluntarily dismissed an action based on the same facts.” Id. at *1. In this case, the circuit court relied upon Cargill in granting the defendant’s motion to dismiss. Id. Subsequent to Cargill, but prior to the appellate court’s ruling on the instant case, the legislature again amended Section 2-622 in 2005. In reviewing the circuit court’s decision, the appellate court specifically examined the language of the 2005 amendment. The prefatory language of the 2005 version stated that the text was “WITHOUT the changes” previously declared unconstitutional. (capitalization in original) Id. at *1. The appellate court noted that in the 2005 amendment, the legislature specifically pointed to the pre-1995 language of Section 2-622 as the “template” upon which the new revisions were based. Id. at *5. The appellate court determined that the legislature “specifically rejected” the 1995 amendment “as a source for its 2005 amendments.” Id. The court found that the inclusion of this language was in accord with the legislature’s duty pursuant to the Illinois Constitution to completely set forth the section being amended. Id., Ill. Const. 1970, art. IV, §8(d). As such, the appellate court found that the civil-reform language of the 1995 amendment “disappeared” with the Illinois Supreme Court’s ruling in Best, and based upon the 2005 amendment to the statute, had not been reenacted. Prior to the 1995 amendment, Section 2-622 did not require language regarding prior voluntarily dismissals be included in the affidavit requesting the 90 day extension. 2007 WL 1859185 at *5. Considering the pre-1995 language as the template for the 2005 amendment, the appellate court found that the language requiring an affidavit stating the matter was not previously voluntarily dismissed was no longer part of the statute, and accordingly, reversed the circuit court’s dismissal of the plaintiff’s refiled action. Id.
JURY AWARD Reduction of Award Upheld for Failure to File Affidavit in Compliance with Rule 222(b)
In Evelyn Grady v. Noelia Marchini, 2007 WL 2215769 (4th Dist. July 31, 2007), the plaintiff filed a lawsuit alleging physical injury, lost earnings, and various damages as a result of an automobile accident. The plaintiff sought damages in excess of $15,000 and, upon filing, the matter was designated as an LM case by the clerk of the circuit court in Champaign County. Grady, 2007 WL 2215769 at *1. The LM assignment designates the case as one seeking less than $50,000. Id. at *4. The plaintiff did not attach a Rule 222(b) affidavit as required by Illinois Supreme Court Rule 222. The jury awarded the plaintiff damages in the amount of $97,000. Id. The defendant filed a motion to reduce the verdict to $50,000 pursuant to Rule 222(b). Id., 166 Ill.2d R. 222(b). The circuit court granted the defendant’s motion. The plaintiff appealed. Grady, 2007 WL 2215769 at *2. The appellate court first looked at the language of Rule 222(b) and considered whether the language required the reduction of the award to $50,000. Id. at *2. Supreme Court Rule 222(b) states that “any civil action seeking money damages shall have attached to the initial pleadings the party’s affidavit that the total amount of money damages sought does or does not exceed $50,000. If the damages sought do not exceed $50,000, this rule shall apply.” Id. at *3. The rule further states that “any judgment on such claim which exceeds $50,000 shall be reduced post-trial to an amount not in excess of $50,000.” Id. The appellate court rejected the plaintiff’s argument that the defendant “forfeited application of Rule 222(b) by not moving to dismiss the complaint and undertaking discovery and presentation of evidence depositions at trial.” Id. The plaintiff further argued that the defendant’s failure to proceed under the limited discovery provisions of Rule 222 similarly prevented the defendant from seeking the reduction. The appellate court dismissed this argument because the plaintiff did not object to the defendant’s actions with respect to
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discovery outside of Rule 222 at trial. Id. at *4. Finally, the plaintiff argued that because it did not file a Rule 222 affidavit, but rather filed a complaint seeking damages in excess of $15,000, the plaintiff was thus not limited by the reduction provision of Rule 222. Id. The appellate court rejected the plaintiff’s argument, focusing on the use of “shall” in the text of the rule, finding that the drafters were expressing a “mandatory intent” in their choice of language, and as such, the affidavit was required. Id.
About the Author Stacy Dolan Fulco is a partner at the Chicago law firm of Cremer, Kopon, Shaughnessy & Spina, LLC. She practices primarily in the areas of premises liability, products liability and wrongful death defense. She received her undergraduate degree at Illinois State University and her J.D./M.B.A. degree from DePaul University. She is a member of the IDC. * The author acknowledges the assistance of Katherine K. Haussermann in the preparation of this article.
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