Florida Supreme Court to Decide Whether Four-Year or One-Year Statute of Limitation Applies to a Prisoner’s Negligence Action

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The Florida Supreme Court will review the First District’s decision in Green v. Cottrell, 172 So. 3d 1009 (Fla. 1st DCA 2015), which certified the following question of great public importance:

Which statute of limitations, whether one- or four-year, should be applied to actions brought by a prisoner relating to the conditions of his confinement?

See No. SC15-1805.

The Florida Statutes that are in dispute are sections 768.28(14) and 95.011(5)(g). Section 768.28(14) provides a four-year statute of limitations for “[e]very claim against the state or one of its agencies or subdivisions for damages for negligent or wrongful act.” On the other hand, section 95.011(5)(g) imposes a one-year limitation period to “an action brought by or on behalf of a prisoner . . . relating to the conditions of the prisoner’s confinement.”

This case arises from injuries suffered by Eric Green, an inmate at the Santa Rosa County Jail, on June 22, 2008. After being beaten by two inmates, Green sought immediate medical attention and filed a county grievance against four correctional officers, alleging their negligence enabled the attack. Eight days later, Green was transferred to a state prison. On June 22, 2012, he filed a complaint regarding the Santa Rosa incident.

Green argued that his transfer from the county jail to a state correctional institution terminated his county grievance, leaving him with no administrative remedy to rectify the correctional officers’ negligence. Green also alleged that his complaint filed four years later was not barred because it fell within the four-year statute of limitations period outlined in section 768.28(14). According to Green, section 95.11(5)(g) was not applicable to his case because it was “less specific as to suits based on negligent or wrongful acts or omissions.”

After a trial, the circuit court held that Green failed to exhaust his administrative remedies because he never followed-up nor “appeal[ed] any lack of answer or negative decision” after filing the grievance. The circuit court also concluded that the one-year limitations period found in section 95.011(5)(g) controlled the state law claims stemming from the conditions of Green’s confinement.

Green appealed to the First District. The First District affirmed the circuit court’s decision and held that Green’s situation was governed by the one-year limitations period in section 95.11(5)(g). According to the court, section 768.28(14) was not applicable in Green’s case because any “claim against the state or one of its agencies or subdivisions for damages for negligent or wrongful act” was too broad. Further, it was undisputed that Green met “the statutory definition of a prisoner” and his state negligence claims against the correctional officers were related to the conditions of his confinement. Thus, the First District concluded that section 95.11(5)(g) was applied correctly since it was only intended for “actions brought by or on behalf of prisoners regarding their confinement.”

Oral Argument is scheduled for August 30, 2016. This article will be updated once the Florida Supreme Court decides the case.

Image courtesy of Flickr by pgbailey (no changes)

California Adopts Sophisticated Intermediary Doctrine

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In Webb v Special Electric Company, Inc., the Supreme Court unanimously adopted the sophisticated intermediary doctrine in California, and then split 5-2 on how it should be applied. Webb was injured by exposure to products containing asbestos and sued the raw asbestos supplier – raising the question of what duty the raw material supplier had to warn the end user of a finished product. As with any seller of a product, a raw material supplier has a duty to warn about product risks that are known or knowable in light of available medical and scientific knowledge.  But, by what means can the supplier discharge its duty?  

The Supreme Court discussed the sophisticated intermediary doctrine in this context as an intersection between the sophisticated user defense (when the end user is already aware of the risk, or should be), the component parts doctrine (a component manufacturer is only potentially liable for the risk created by its component in the finished product), and the bulk supplier doctrine (noting circumstances in which a bulk supplier has no duty of care regarding the finished product). Furthering the policy goals of these doctrines, the Supreme Court adopted the sophisticated intermediary doctrine, as described by the Restatement Third of Torts, Products Liability, as an affirmative defense. 

“Under this rule, a supplier may discharge its duty to warn end users about known or knowable risks in the use of its product if it: (1) provides adequate warnings to the product’s immediate purchaser, or sells to a sophisticated purchaser that it knows is aware or should be aware of the specific danger, and (2) reasonably relies on the purchaser to convey appropriate warnings to downstream users who will encounter the product.”  These will all typically be questions of fact on which the supplier will have the burden of proof.

The court split 5-2 on the first prong, with the dissenters (the Chief Justice and Justice Chin) concluding that the raw material supplier should be required to show that it provided actual warnings or that the intermediate buyer is actually aware of the dangers.  The dissenters were concerned that the rule as expressed created a loophole which could result in no actual warnings, but just the “reasonable belief” that they would be provided by someone else. In discussing the second element, the Supreme Court cited the Restatement regarding three factors for consideration of reasonable reliance: (1) the gravity of the risks posed by the product, (2) the likelihood that the intermediary will convey the information to the ultimate user, and (3) the feasibility and effectiveness of giving a warning directly to the user.  Noting that there is little functional difference between a failure to warn claim in strict liability or in negligence, the Supreme Court confirmed that the sophisticated intermediary doctrine applies to both. 

In this case, the Supreme Court found that record simply did not support the sophisticated intermediary doctrine, and that the defendant failed to argue this issue to the jury, or request jury instructions or a verdict form that addressed this issue.  Thus, the unanimous Court affirmed the jury verdict for plaintiff.

Image courtesy of Flickr by daryl_mitchell

Illinois Supreme Court Appears Likely to Strike Down 6-Person Jury Statute

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During the May term, the Illinois Supreme Court heard oral argument in Kakos v. Bauer, a constitutional challenge to Public Act 98-1132, the 2015 statute mandating six-person juries in civil cases in Illinois. Based upon the pattern of questioning, it appears fairly likely that the Court is inclined to affirm the judgment and strike down the statute. The opinion of the Cook County Circuit Court holding that the 6-person jury statute is facially unconstitutional is here.

Before Public Act 98-1132 went into effect, 735 ILCS 5/2-1105(b) stated that claims involving $50,000 or less in controversy may be tried to a jury unless either party demanded a 12-person jury. The Act amended the statute to abolish the opt-out by which parties could insist on a full 12-person jury. At the same time, daily juror fees were significantly increased.

In Kakos, the defendants moved for leave to file a 12-person jury demand, and in the alternative for an order holding that Section 2-1105(b) was facially unconstitutional. The defendants argued that the abolition of 12-person juries violated Article I, Section 13 of the Illinois Constitution, which protects the right to a jury trial. The trial court agreed with the defendants. In a 27-page opinion, the Court held that twelve jurors was a substantive part of the jury trial right, beyond the Legislature’s authority to change. Even if that weren’t so, the Court further held, the statute also fell on separation of powers grounds, since the state Constitution vests the power to regulate the conduct of trials exclusively in the state Supreme Court. The appeal went directly to the Supreme Court as a matter of right.

Counsel for the plaintiff began the oral argument at the Supreme Court. Counsel explained that there were two issues in the case: first, was section 2-1105 constitutional, and second, even if there wasn’t a 12-person jury right, could the General Assembly (as opposed to the Supreme Court) make the change? Counsel noted that Section 13 of Article I doesn’t specify a number of jurors. The defendants argued that the number twelve was sacrosanct, but counsel insisted that a six person jury serves exactly the same purpose as having a dozen jurors. The issue, counsel argued, is whether the citizen is being protected, and the answer with six jurors is still yes. Justice Karmeier asked whether the General Assembly could reduce the jury to three, or two, or even one juror. Counsel said it was up to the General Assembly to determine what number still amounted to a jury of one’s peers. Justice Burke commented that the plain language of Section 13 protects the jury right as “heretofore enjoyed,” and asked what that means. Counsel responded that at the time the 1970 constitution was adopted, the court had already determined that a jury of six was okay. Justice Burke asked whether any of the 1970 constitutional convention debates supported smaller juries, and counsel said no, the language was carried over from an earlier version of the constitution. Counsel noted that when the 1870 constitution was approved, it was widely accepted that a jury was twelve men. During the 1920 constitutional convention, there was some discussion of whether women had the ability or the right to sit on a jury. Ultimately, the General Assembly opened juries to both genders by statute, and in 1937, the Supreme Court okayed that statute. Whatever the Convention thought in 1970, counsel argued, doesn’t mean that the General Assembly doesn’t have the authority to tweak the interpretation of the jury trial right. Justice Theis commented that the Court has reaffirmed over and over the notion that a trial by jury is twelve people. Isn’t that principle deeply embedded in the Court’s jurisprudence? Counsel answered that the Court had never decided expressly whether six jurors were eonough. Counsel noted that some dicta over the years has suggested that only the basic purpose of the jury must remain the same – details can evolve. The Chief Justice asked where the Court had purportedly approved a six-person jury – in Rule 285? Counsel said yes, and noted that Rule 285 was already in place at the time of the 1970 constitutional convention. There’s now fifty years of precedent for six people sitting in civil cases. Chief Justice Garman pointed out that under Rule 285, the only way one can get to six jurors is if both sides agree, but counsel suggested that in a sense, that misses the point; the Court has put its imprimatur on a six person jury, which serves the same purpose as twelve. Justice Karmeier said that counsel was talking about the purpose of the jury, but wasn’t the issue what the constitution meant? Counsel agreed that the issue was construing the constitution. Chief Justice Garman asked whether there was any evidence that the constitutional convention delegates in 1970 believed that the legislature could reduce the size of a jury. Counsel responded that it wasn’t clear, and the text doesn’t say. He concluded by briefly turning to the second issue, noting that the Court has held before that the General Assembly has the power to pass laws affecting the operation of the judicial system.

Counsel for the defendants followed, arguing that numerous decisions have confirmed that a jury must be twelve. Every court which has ever looked at the possibility of smaller juries (without an opt-out) has held that they are not permitted. Justice Theis noted that at the constitutional convention, an amendment was offered which engaged these specific issues – what happened? Counsel answered that ultimately, the bottom line at the convention was that juries had to be twelve. Public policy and other states’ decisions upholding six person juries are irrelevant, counsel argued – the Illinois constitution has always had the same operative language, and every case that has ever considered the matter has found twelve to be essential. Counsel also suggested that the new statute can’t be squared with Rule 285’s provision for a default of six in small claims absent objection, and where a statute and Supreme Court Rule conflict, the rule trumps the statute. Counsel argued that the plaintiffs were citing federal constitutional decisions, but the Court has held that Federal law is irrelevant with respect to this provision, since the Illinois jury trial right is broader in scope than the federal right. Counsel agreed that the legislature has made changes over the years on the procedural side, such as the timing of a jury trial demand, but the number of the jury is a substantive component of the right. Counsel argued that public policy discussions were irrelevant too – it didn’t matter whether a six person jury might arguably serve the same purpose. Counsel concluded with the separation of powers issue, noting that the legislature is limited to passing statutes on judicial procedure which either complement the authority of the Supreme Court or have only a peripheral impact on court administration. The primary authority to regulate judicial proceedings is exclusively vested in the Supreme Court. The 6-person jury statute, according to counsel, is not one which complements the Court’s authority.

Counsel for the plaintiffs concluded by again arguing that the Supreme Court has never had to decide whether six person juries are permissible. Juries of six have been allowed since 1964 through Rule 285. The question for the Court is whether the six person jury fulfills the purpose of juries. The point is to protect the citizens against the improper use of government power. The legislature has concluded that six is enough to serve that purpose. According to counsel, although the legislature can’t impair the essentials of the jury trial right, it has the power to legislate about the issue. Counsel noted that the predecessor statute amended by Public Act 98-1132 had differed from Rule 285 – the Rule provided for optional six-person juries in cases involving $10,000 or less, but the previous statute set that threshold at $50,000. Counsel denied that Supreme Court rules automatically trumped statutes, and suggested that Rule 285 could be interpreted in a way as to be consistent with the six-person jury statute.

We expect Kakos to be decided in three to four months.

Image courtesy of Flickr by Steve Cornelius (no changes).

Illinois Supreme Court Debates Whether the Discovery Rule Applies to Wrongful Death

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The discovery rule provides that under certain circumstances, the statute of limitations is tolled until the plaintiff knows not only of his or her injury, but knows or reasonably should know that the injury was likely negligently caused. Does the discovery rule apply to wrongful death claims? The Illinois Supreme Court debated that issue last month, hearing oral argument in Moon v. Rhode. Our detailed summary of the underlying facts and lower court rulings in Moon is here.

In 2009, plaintiff’s ninety-year old decedent was admitted to the hospital for surgery. She died nine days after the operation. The following month, the court appointed the plaintiff executor of the decedent’s estate.

Eight months later, the plaintiff executed a HIPAA authorization to get the decedent’s medical records. Fourteen months after that, the plaintiff asked a medical consulting firm to review the materials. In May 2011 – almost two years after the decedent’s death – the plaintiff received a written report from the consultants concluding that the decedent’s surgeon and primary care doctor had been negligent.

The plaintiff sued the defendant doctors in May 2011. In February 2013, the plaintiff sent the decedent’s radiographs to another consultant for review. The second consultant concluded that the negligence of the defendant’s radiologist in reviewing the radiographs had led to her death. A few weeks later, the plaintiff filed a wrongful death claim against the radiologist. The defendants moved to dismiss the claims under the statute of limitations, the Circuit Court granted the motion, and the Appellate Court affirmed.

Counsel for the executor began the Supreme Court argument. He explained that the Appellate Court had held that the statute of limitations begins to run regardless of whether the plaintiff had reason to know that the injury was caused by a wrongful act – the statute begins when the plaintiff becomes aware of the decedent’s death. According to counsel, the defendants had argued before the Appellate Court that there was no basis on the facts to apply the discovery rule to extend the statute – the first time anyone had suggested the notion that the discovery rule doesn’t apply at all to wrongful death claims was when the Appellate Court’s opinion was issued. Counsel argued that the Wrongful Death Act contains a limitations provision, but the Limitations Act actually controls. Justice Thomas asked what the Court should do with the language of the Wrongful Death Act, which says that every action must be commenced within two years of death. Counsel responded that there is “rich precedent” saying that the Limitations Act, as both the more specific and later-passed Act, controls over the Wrongful Death Act. Justice Thomas pointed out that legislation was recently considered in the legislature which would have expressly provided a discovery rule for wrongful death cases – why would the legislature have done that if the discovery rule already applied? Counsel pointed out that the proposal did not pass, and unpassed legislation is of de minimis value in deciding the meaning of stattues. Justice Burke asked whether the time which passed between the plaintiff receiving the records and contacting the medical records reviewing firm was significant. Counsel responded that when the person knew enough to trigger the statute of limitations was generally a question of fact. The Chief Justice asked whether the trial court had concluded that the discovery rule didn’t apply. Counsel answered that the trial court had accepted the defendant’s claim that the plaintiff knew enough at the time of death to bring the action. The court focused on the plaintiff’s deposition testimony, in answer to a question about the impact of his mother’s death, that “I wish she had gotten better treatment.” But that’s not a reasonable suspicion of negligence, counsel argued. Justice Thomas asked how long a plaintiff could wait before consulting an expert to investigate, and counsel said there was no bright line. Justice Thomas asked whether a relative could suddenly decide four years after the decedent died that there was something wrong with the decedent’s care, and the relative has tolled the statute for four years? Counsel answered that reasonable basis is a question of fact for the jury. The plaintiff was working on the initial complaint, and he acquired knowledge suggesting further wrongful conduct. Justice Thomas asked about the timeline. Counsel answered that the decedent died in May 2009, plaintiff requested records in February 2010, and he contacted the medical consultants in April 2011. Justice Thomas asked what was the operative date of discovery, and counsel answered that nobody has fixed one. The dissenter at the Appellate Court argued that the statute began running in May 2011. Justice Thomas asked whether counsel was asking the Court for a bright line rule as to how long the plaintiffs have to investigate potential wrongdoing. Counsel answered that the case had ended on a motion to dismiss, and the trial court never fixed a time – it just said this was too long. Justice Theis noted that the courts have looked at the word injury in the Limitations Act and construed it as meaning “event plus wrongful causation.” Was the plaintiff asking the Court to read the Wrongful Death Act’s use of the word “death” in a similar way – and wasn’t that reading into the statute language that wasn’t there? Counsel answered that the word “death” in the Limitations Act should be interpreted exactly the same way “injury” has been. Justice Karmeier asked why the Wrongful Death Act wasn’t the more specific enactment, and counsel answered that the cases have held that the Limitations Act controls.

Counsel for the defendant doctors argued next, saying that the legislature had provided 730 days to investigate a potential wrongful death claim, and that was ample time here. There was no argument that the statutory language was ambiguous. The Supreme Court’s own precedent establishes that “death” in statutory terms is different from “injury.” Counsel argued that the Wrongful Death Act and the Limitations Act can be read harmoniously. Counsel noted Justice Thomas’ comment about the legislature’s consideration of a bill expressly incorporating the discovery rule, and suggested that that proves the legislature knows how to amend the statute when it wants to. Justice Thomas asked whether there was any mechanism that would toll the statute when there was an indication after death suggesting a wrongful act. Counsel pointed out that claims can be brought more than two years out in cases of fraudulent concealment or equitable estoppel. Justice Theis noted that the cases interpreting non-fatal injuries have explained that it can sometimes take some time to realize that a physical harm was negligently caused. So why shouldn’t the word “death” be interpreted the same way? Counsel pointed out that wrongful death actions are in derogation of the common law, so the statute must be strictly construed. But more generally, in ordinary malpractice cases, sometimes negligence has a delayed manifestation. Death is different because the injury is obvious. Justice Theis noted that the theory that “injury” incorporates “wrongful cause” has been the law for thirty years – does the fact that the legislature has never amended the statute to expressly exclude the discovery rule matter? Counsel answered no, since this was the Court’s first time interpreting the statute. Justice Kilbride asked whether there would have been any way to bring the case without the medical report. Counsel said yes, plaintiff could file and seek an extension. That illustrated the problem with the view of the Appellate Court dissenter that the discovery occurs when the medical report is received. Counsel noted that the decedent has been hospitalized with abdominal problems. Her adult children were all involved in addressing the worsening complications after the surgery. All of those facts, taken together, had triggered the statute by pointing to the conclusion that there was knowledge no later than February 2010.

Counsel for the plaintiff concluded by saying that the plaintiff has never advocated a bright line rule, nor that the statute doesn’t begin until there’s knowledge of negligence. The issue is when there was a reasonable suggestion of it. Counsel suggested that if the Court did not read “causation” into the statutory term “death,” the Court was on its way to undoing several earlier cases – that would put in jeopardy all discovery rule cases in Illinois. Chief Justice Garman asked whether there is a danger that the Court would be effectively saying that the statute was two years for all medical malpractice cases except wrongful death. Counsel responded that that was a question for another day. That tension would exist, but the medical malpractice statute of limitations, rather than the wrongful death statute, governs here. Counsel concluded by disputing the defendant’s view that death alone is sufficient to put a plaintiff on inquiry notice, arguing that the courts have applied the discovery rule.

We expect Moon to be decided in three to four months.

Image courtesy of Flickr by M01229 (no changes).

Illinois Supreme Court Debates Whether Occupational Disease Disability Pension Triggers Health Insurance Benefit

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Section 10 of the Public Safety Employee Benefits Act provides that when a covered employee sustains a “catastrophic injury” under certain enumerated circumstances, the employee is entitled to have his or her health insurance premiums, as well as those of his or her partner and/or dependent children, paid by the employer.  During the May term, the Illinois Supreme Court heard oral argument in Bremer v. City of Rockford, which poses the question of whether the health insurance benefit set forth in Section 10 of the PSEBA is triggered by an occupational disease disability pension.  Our detailed summary of the underlying facts and lower court holdings in Bremer is here.

Plaintiff started working for the city as a firefighter in 1976.  In May 2004, he filed an application with the Pension Board seeking an occupational disease disability pension pursuant to Section 4-110.1 of the Pension Code (40 ILCS 5/4-110.1), arguing that he suffered from cardiomyopathy as a result of chemicals and toxins he inhaled at the scenes of various fires.  The Board granted the pension.

A year later, the City informed the plaintiff that it intended to stop paying his health insurance premiums.  The plaintiff applied for health insurance benefits under PSEBA Section 10, but the City denied his claim.  The plaintiff sued, seeking a declaratory judgment that he had suffered a catastrophic injury within the meaning of the statute.  The parties filed cross-motions for summary judgment, and the trial court granted the plaintiff’s motion on the merits.  Subsequently, the court granted the City’s motion for summary judgment on the plaintiff’s second count, which sought an award of attorneys’ fees under the Wage Actions Act.  A divided panel of the Appellate Court affirmed the plaintiff’s position that he had suffered a “catastrophic injury,” but remanded for further consideration of whether he satisfied the additional circumstances necessary to trigger the health insurance benefits.  The Court affirmed the City’s position that the plaintiff was not entitled to an award of attorneys’ fees under the Wage Actions Act.

Counsel for the firefighter began the argument at the Supreme Court, arguing that the trial court and the Appellate Court had correctly determined that the plaintiff’s award of an occupational disease pension automatically constituted a “catastrophic injury” under the Act.  The Appellate Court had erred however, counsel argued, in reversing summary judgment and finding a genuine issue regarding whether the plaintiff’s injury had resulted from responding to what he reasonably believed to be an emergency.  Counsel also stated that he would address the attorneys’ fees issue – an important issue to persons in the firefighter’s position, who were disabled and often in difficult economic circumstances.  Justice Freeman stated that in Krohe v. City of Bloomington, the Supreme Court had construed the statute based upon the debates.  So was it for the Court or the legislature to expand the definition of catastrophic injury?  Counsel answered that Krohe hadn’t expanded the definition.  Krohe interpreted the language of the statute, but hadn’t considered disability arising from occupational disease.  Justice Thomas noted that there are three kinds of pensions under the statute – occupational disease, line of duty, and non-line.  The first two are incurred as a result of performing duties – shouldn’t they be treated the same?  Counsel answered yes, that the occupational disease standard and the line of duty pension were similar.  Justice Thomas asked whether counsel saw Krohe applying.  Counsel responded that catastrophic injury is one that arises in the line of duty, so his theory was consistent with Krohe.  The problem was that the Krohe court didn’t consider the occupational disease pension.  Chief Justice Garman asked counsel to explain how Nowak v. City of Country Club Hills applied.  Counsel responded that according to Nowak, the Section 10 health insurance benefit is a post-termination benefit, because there is no entitlement to benefits under disability is determined.  But Nowak didn’t involve the question of whether the Wage Act applied, and PSEBA benefits are wages under the Wage Act.  Justice Theis asked counsel whether he was arguing that the benefits were deferred compensation.  Counsel answered that there is a vested right of payment for life if the employee is catastrophically injured while employed full time.  That right accrued when he was injured.  Justice Theis asked whether a vested right is the same thing as a wage, and counsel said yes.  Section 10 of PSEBA made the health insurance benefit part of the employee’s compensation package.  The question, counsel argued, was when the right accrues – and here, the plaintiff’s right to the benefit accrued when he was disabled as a full-time employee.  Counsel concluded by briefly addressing the pension issue itself, arguing that the plaintiff had given uncontroverted testimony that he was exposed to chemicals and toxins at fire scenes, every one of which qualified as an emergency.  The Appellate Court, however, had held that an emergency couldn’t be proven categorically.

Counsel for the city followed, and argued that it was absurd on its face, in the wake of the Act and Krohe, that the health insurance benefit applied to occupational disease disabilities.  Catastrophic injury is synonymous with a line of duty disability under the Pension Code.  But the plaintiff, counsel argued, had an occupational disease disability under Section 4-110.1 of the statute, not a catastrophic injury.  The two statutes have very different causation standards.  Counsel argued that there was no way to affirm the finding of catastrophic injury below without expanding Krohe and rewriting the legislative history.  Justice Thomas suggested that both line of duty and occupational disease pensions arose from performing the duties of the job.  Counsel answered that it was a different standard – a line-of-duty pension arises from specific acts, while an occupational disease pension arises from general service as a firefighter.  Justice Thomas asked for a practical reason to separate out a line-of-duty pension and an occupational disease pension arising from job duties.  Counsel said that it’s simply a different section of PSEBA.  It’s up to the legislature to define what is covered by the benefit, and if the legislature had intended Section 10 to apply to occupational disease pensions, it would have said so.  Moreover, the plaintiff had to prove one of the four circumstances, not just a catastrophic injury.  The plaintiff claimed two: that he was injured responding to emergencies, and while investigating crimes.  The Chief Justice asked whether an evidentiary hearing was necessary for that issue.  Counsel answered that there was no evidence that the firefighter was injured through responding to emergencies – only speculative medical opinion.  Counsel suggested that he didn’t know what the plaintiff could possibly produce in an evidentiary hearing that would demonstrate causation.

Counsel for the plaintiff concluded, once again arguing that Krohe looked at line of duty pensions, and nothing more.   Chief Justice Garman asked whether, if the Court accepted the plaintiff’s view, any occupational disease pension would automatically trigger Section 10.  Counsel answered no, the benefit would be available only if the plaintiff showed that the disease arose from service as a firefighter.  The Chief Justice asked if counsel was suggesting that the fact that plaintiff had a serious injury was what mattered, rather than the circumstances in which the injury was sustained.  Counsel answered that a serious injury disabling the plaintiff qualified as a catastrophic injury, and the circumstances made it an emergency.  Chief Justice Garman asked whether that meant that every firefighter with an occupational disease would qualify under Section 10.  Counsel said yes, arguing that there was no need for medical causation testimony linking the disease to causation when the plaintiff’s own testimony is clear and uncontroverted.  Defendant had never put the issue of causation in question, plaintiff argued.  Justice Thomas asked whether, as things currently stood, the case was going back for fact finding on causation.  Counsel answered yes, but the evidence from the plaintiff’s own testimony was that all his fires were emergencies.  The Appellate Court, counsel argued, had entirely ignored the plaintiff’s affidavit on the emergency issue.

We expect Bremer to be decided in three to four months.

Image courtesy of Flickr by RL GNZLZ (no changes).

Illinois Supreme Court Debates Interaction Between Workers Comp Act and Contribution Act

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During the May term, the Illinois Supreme Court heard oral argument in Bayer v. Panduit Corp., an appeal from Division 1 of the First District which poses several questions about the interaction of the Workers’ Compensation Act and the Contribution Act.  Our detailed report on the facts and lower court decisions in Bayer is here.

The defendant in Bayer is an electrical components manufacturer in De Kalb.  In 2007, defendant decided to expand its warehouse, acting as its own general contractor.  The defendant signed contracts with an iron works company for the structural steel.  The iron works contractor subcontracted with the plaintiff’s employer to upload and erect the structure.

The plaintiff was seriously injured working at the site.  He filed a workers compensation claim against his employer.  He subsequently filed suit against the defendant for negligence, later adding the iron works company as an additional defendant.  The defendant filed a third-party claim against the plaintiff’s employer, alleging that it had failed to ensure the safety of its employees and seeking a judgment in contribution.

The plaintiff and his former employer filed a motion for good faith settlement under Section 2 of the Contribution Act (740 ILCS 100/2).  Section 2 provides that when a party settles a claim in good faith against one tortfeasor, the good faith finding discharges that tortfeasor from any liability in contribution.  The motion was granted.  Two weeks later, the plaintiff settled with the iron works company, leaving only the defendant – the property owner – to go to trial.  Trial resulted in judgment for the plaintiff for $64 million.

The defendant property owner filed a posttrial motion challenging the dismissal of the contribution claim on the grounds that the settlement had not been in good faith.  The plaintiff filed a motion for an award of attorneys’ fees and costs against his former employer pursuant to the Workers Compensation Act.  The defendant’s motion was denied; the plaintiff’s motion was granted as to fees relating to future workers compensation payments, but denied as to costs.

Both the defendant and the plaintiff’s former employer appealed.

The defendant filed a posttrial motion alleging that the court had erred in dismissing the contribution claim against the plaintiff’s employer because the settlement was not in good faith. Following a hearing, the trial court denied the defendant’s motion. Concurrently, the plaintiff filed a motion for attorneys’ fees and costs against his employer pursuant to the Workers Compensation Act. That motion was granted as to fees relating to future workers’ compensation payments, but denied as to costs.

Both the defendant and the plaintiff’s employer filed notices of appeal.  The Appellate Court affirmed the finding of good faith settlement and the consequent dismissal of the contribution claim.  The court reversed in part with respect to attorneys’ fees, holding that the employer was not liable for fees in connection with future medical benefits suspended under the Workers Compensation Act as a result of tort settlements.

Counsel for the plaintiff began the Supreme Court argument.  He explained that the plaintiff’s former employer did not challenge its liability for attorneys’ fees in connection with savings on future losses, but did challenge the fees award with respect to medical expenses.  Chief Justice Garman asked whether the issue was one of statutory interpretation.  Counsel responded that it was, and that the first two paragraphs of the applicable section were at play.  Justice Burke asked if future medicals were included in the parties’ settlement, weren’t attorney fees included?  Counsel answered that there were attorneys’ fees paid, but Section (b) of the statute requires a mandatory contribution to the one-third attorney fee – a pro rata division between the plaintiff, the injured party and the employer.  Counsel explained that the plaintiff’s employer did not challenge the attorneys’ fees award with respect to lost wages.  The Chief Justice asked whether the plain language of the statute supported the plaintiff’s position, or was the statute ambiguous.  Counsel answered that the first paragraph of the statute established what the reimbursements were.  Justice Thomas asked what plaintiff’s position was on whether his position amounted to a double recovery.  Counsel answered that the trial court had specifically ordered that there should be no duplicate fees.  Justice Thomas asked whether any overlapping fees would be returned to the defendant, and counsel said yes.  The argument the employer was making, counsel argued, was not consistent with the statute.  The cases say that the parties settle, and workers compensation payments are suspended, and future payments to the employer are relieved.  As the payments become due, the employer is relieved and savings are realized.

Counsel for the employer argued next.  He began by arguing that the issue was entirely one of statutory interpretation.  The issue before the Court involved statutory interpretation – it was not a common fund issue.  Justice Theis suggested that Section 8(a) of the Act seemed to define compensation as requiring the employer to provide all medical expenses and subsequent expenses incurred – did that include future medical expenses?  Counsel said yes.  Justice Theis commented that the key word the defendant appeared to be concerned with was “reimbursement” versus “compensation.”  Counsel agreed.  Justice Theis noted that the statute says that compensation includes future medical expenses – now the defendant was saying that reimbursement is distinct from compensation.  Counsel answered that this wasn’t a reimbursement; the expenses had already been paid.  Medical expenses required ongoing administration and constant disputes.  Counsel argued that there had been an incredible overpayment already – the defendant has already paid almost $28 million, including a $500,000 deductible on both sides.  Now the Appellate Court is suggesting that the defendant pay on suspended medical benefits.  Counsel concluded by arguing that the plaintiff was seeking a double recovery, and it was clearly contrary to the statute.

Counsel for the plaintiff concluded with rebuttal.  Justice Thmoas asked about weekly future medical expenses – did the one-third already paid in attorneys’ fees require judicial monitoring?  And if not, did this amount to a lawyer paying a fee to a nonlawyer?  Counsel responded that there was nothing barring the fee.  Chief Justice Garman asked whether there was an issue regarding the amount of monitoring that would be necessary because the medical expenses are indefinite in duration.  Counsel responded that there was no indication that monitoring would be necessary here – even if an issue developed down the road, that doesn’t mean that the defendant could rewrite the statute.  Justice Thomas concluded by pointing out that the defendant had a theory as to why this issue hadn’t arisen before – did the plaintiffs have an alternative theory?  Counsel answered that the case involved a significant verdict, and there was accordingly quite a bit of money at stake.  This case was the first time the matter had ever been contested by defense counsel.

We expect Bayer to be decided in three to four months.

Image courtesy of Flickr by Suga (no changes).

Illinois Supreme Court Agrees to Decide Constitutional Challenge to Property Tax Exemption Statute

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According to Article IX, Section 6 of the Illinois Constitution, the legislature may exempt from property taxes only the “property of the State, units of local government and school districts and property used exclusively for agricultural and horticultural societies, and for school, religious, cemetery and charitable purposes.”  According to Section 15-86 of the Property Tax Code, a hospital may qualify for a charitable exemption by providing services or activities worth as much or more than the hospital’s estimated property tax bill for that year.  Is Section 15-86 facially unconstitutional?  That’s the question the Illinois Supreme Court agreed to answer in the closing days of the May term, allowing a petition for leave to appeal in The Carle Foundation v. Cunningham Township.

Carle Foundation arises from four parcels in Urbana, Illinois.  An affiliate of the plaintiff operates a hospital on two of the parcels, the third contains a day care center, and the fourth contains a power plant which serves the other three parcels.  Until 2004, the four parcels were considered exempt under the charitable use exception.  But between 2004 and 2011, the township assessor assessed the four parcels at their full value.

In late 2007, ten months after its application for a charitable exemption was denied, the plaintiff filed suit, seeking a declaratory judgment that the four parcels were exempt from taxation pursuant to section 15-65 of the Property Tax Code.  Ultimately, after one trip to the Appellate Court, the plaintiff withdrew its applications for exemptions for 2004 and 2005.  Later, it filed applications for exemptions for the years 2006 and 2008, but it ultimately withdrew those applications too.  The plaintiff made no attempt to have the parcels exempted for the years 2009-2011.

The plaintiff’s Fourth Amended Complaint contains 35 separate counts.  The Appellate Court divided them into four categories: (1) the earlier exemptions were never validly discontinued; (2) the parcels were exempt under the recently enacted Section 15-86; (3) a request for declaratory judgment that Section 15-86 applied retroactively to the tax years 2004 through 2011; and (4) for alleged breach of a settlement agreement.  The trial court granted plaintiff summary judgment on its claim that the parcels were exempt pursuant to Section 15-86, entering a Rule 304(a) finding to purportedly authorize an interlocutory appeal.  Three separate groups appealed: the Department of Revenue; the township, city and township assessor; and various county officials.

The Fourth District reversed the Circuit Court.  The court began by considering its own jurisdiction.  The Circuit Court had entered a Rule 304(a) finding, but “that is not enough.”  There had to be an actual final judgment on a separate claim, or the Rule 304 language accomplished nothing.  The Court ultimately concluded that by entering summary judgment granting declaratory relief under Count II, the court below had entered a final judgment in a matter which was sufficient separable from the rest of the case.

The Court then turned to the question of whether Section 15-86 could apply to a proceeding under Section 23-25(e) of the Code.  Section 15-86 plainly related by its plain language to an administrative procedure for determining exemptions, while Section 23-25(e) was supposed to be a judicial alternative to an administrative determination.  The Court ultimately concluded that Section 15-86 did apply to the declaratory judgment action, at least indirectly, in the sense that plaintiffs could argue that they had been arbitrarily denied an exemption under Section 15-86 when one had been administratively granted to similarly situated years or parcels.  The Court then reviewed the question of whether the legislature plainly intended for Section 15-86 to apply retroactively, and concluded that it did.

All that led the Court to the central question: could Section 15-86 be squared with Article IX, Section 6?  The Court began by noting that although the constitution limited exemptions to property used “exclusively” for charitable purposes, the courts had consistently held that the word “exclusively” shouldn’t be taken too literally; as long as a non-charitable use was de minimis over the course of a year, it didn’t imperil the property’s exemption.

But even with that qualification, were “services worth more than the foregone property tax bill” sufficient to qualify as “exclusive” charitable use under the Constitution?  The traditional test for a facial constitutional challenge involves the court determining whether there is any hypothetical set of circumstances in which the statute could be validly applied – that’s why so few facial challenges ever succeed.  The Fourth District suggested at some length that the “no set of circumstances test” was vague, difficult to apply, and that it wasn’t entirely clear that even the United States Supreme Court truly adhered to it anymore, citing Washington State Grange v. Washington State Republican Party.  Nevertheless, the Court concluded that Section 15-86 was facially unconstitutional because it mandated charitable exemptions pursuant to a criterion that couldn’t be reconciled with the criterion in Article IX, Section 6.

We expect Carle Foundation to be decided this winter.

Image courtesy of Flickr by Adrian Clark (no changes).

Illinois Supreme Court Agrees to Hear Facial Challenge to Park Regulations in Occupy Case

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May the City of Chicago constitutionally enforce its park-closing ordinance against political protestors from the Occupy movement?  That’s the question posed by The City of Chicago v. Alexander, a case from the First District, Division 2 which the Illinois Supreme Court agreed to hear in the closing days of its May term.

The Occupy movement began in New York’s Zuccotti Park on September 17, 2011.  Five days later, a protest began in Chicago’s financial district in front of the Federal Reserve Building, the Chicago Board of Trade and the Bank of America building.  The Chicago Police Department allowed the protestors to remain in place around the clock, but refused to permit them to store provisions or erect structures.   The protestors began receiving donations of supplies.  The police initially agreed that the protestors could store supplies on the edge of the sidewalk, but ultimately told them they had to move the supplies or face confiscation.  The protestors found an off-site storage facility, but donations kept on coming.  Finally, about a week after the protests began, the police told protestors that anything still remaining at nine the next morning would be confiscated.  On October 15, 2011, an Occupy Chicago rally concluded by occupying Grant Park.  The protestors began erecting tents.

Police told protestors that they would not be allowed to stay in the park past 11 p.m.  Prior to that time, the police read Chicago Municipal Code § 10-36-185, which states that all parks are closed to the public between 11 p.m. and 6 a.m., over a loudspeaker system, saying that anyone remaining in the Park after 11 would be arrested.  Around 300 protestors remained in the Park when 11 p.m. came.  At approximately 1 a.m., the police once again told protestors to leave the park, using the loudspeaker system, and then asked each protestor individually whether he or she wanted to leave or be arrested.  The police ultimately arrested 173 protestors that night.  Six days later, the police arrested another 130 protestors at the end of another protest which also wound up in Grant Park.

Although some of the protestors pled guilty to the violation, ninety-two challenged the constitutionality of the ordinance, both because the ordinance suppressed symbolic speech and because it had been unequally enforced, depending on the speaker.  The Circuit Court agreed, holding that the ordinance was unconstitutional on its face and had been applied in a discriminatory way.  The First District initially reversed that judgment, but in a supervisory order, the Supreme Court instructed the Court to vacate its original decision and consider whether the ordinance violated the right to free assembly under the Federal and state constitutions.

On reconsideration, the First District once again reversed the Circuit Court’s judgment.  The Court began with the First Amendment challenge.   Although the First Amendment offers “a host of protections,” the Court wrote, it “does not guarantee the right to employ every conceivable method of communication at all times and in all places.”  Nevertheless, the Court agreed that Grant Park was a “quintessential public forum” in constitutional terms.

The Court rejected the facial challenge, finding that there are “many applications” of the statute “in which the ordinance is constitutional.”  The ordinance was not fatally overbroad in the Court’s view because it was limited to city parks and only covered a seven hour period.

With respect to the as-applied challenge, the Court found that the ordinance was reasonably tailored to respond to the city government’s interest in maintenance and cleaning of the park.  Although the trial court had observed that seven hours seemed an excessive amount of time to accomplish that purpose, the First District found that the courts could not substitute their judgment for that of the park district on that score.

The City argued that the ordinance allowed ample alternative forums for the protestors to continue delivering their message.  The protestors argued that remaining in Grant Park was essential to their mission because it provided maximum exposure to pedestrian and vehicular traffic.  However, the court found that a constitutionally acceptable alternative for communication need not be the speakers’ first choice, or even involve the same form of communication.

The protestors also argued that the ordinance was unconstitutional because it had not been enforced in a viewpoint-neutral way.  A selective enforcement challenge requires proof that (1) the defendant received different treatment from others similarly situated; and (2) the differing treatment was based on invidious grounds like race, religion, bad faith or the exercise of First Amendment rights.  The protestors pointed out that the 2008 election-night rally celebrating the President’s election had lasted well past 11 p.m., and not only had the police not arrested everyone in the Park, they had provided additional security for the event.  The City responded to the protestors’ argument by noting that they had not initially enforced the ordinance against the protestors either, waiting until two hours past closing of the park to begin arrests.  The Court rejected the protestors’ challenge, concluding that the Occupy protestors and the Obama crowd were not similarly situated.

Finally, the Court turned to the question of whether the ordinance violated the right of free assembly under Article I, Section 5 of the Illinois Constitution.  The Court agreed that the Illinois Constitution provides a somewhat broader right to free assembly than the Federal constitution does.  However, that does not mean that the right is free of any limitation arising from time, place and manner restrictions.  Since the Court had already found that the ordinance was a valid time, place and manner restriction, the Court rejected the free assembly claim.

We expect City of Chicago to be decided this winter.

Image courtesy of Flickr by Ray Devlin (no changes).

Illinois Supreme Court Agrees to Decide Whether Ice Patches From Allegedly Negligent Maintenance Can Create Liability

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In order to encourage property owners to remove snow and ice from their property, the Illinois Legislature enacted the Snow and Ice Removal Act, 745 ILCS 75/1.  According to the Act, barring willful or wanton misconduct, property owners are not liable for injuries caused by natural accumulations of snow and ice on their property.  But what about when allegedly negligent landscaping or maintenance supposedly caused an ice patch?  That’s the issue in Murphy-Hylton v. Lieberman Management Services, Inc., a decision from Division 1 of the First District Appellate Court which the Illinois Supreme Court has agreed to review.

Murphy-Hylton arose in early 2011 when the plaintiff slipped and fell on a small patch of ice on a sidewalk near her condominium unit.  She testified that the sidewalk did not appear to be wet at the time of her fall, nor did she see salt anywhere.  The plaintiff testified that the only snow she saw at the time of her fall was a 3-4 foot snow bank at the end of the parking lot about 60 feet away.  The weather that day was “bright and sunny and cold,” but there had been no precipitation.  According to the plaintiff, downspouts on one of the buildings drained in the area of her fall, and water “would kind of accumulate there.”  Plaintiff’s brother testified that he had been at the condominium either the day of the accident or the day after, and had noticed that the area of the fall was “puddly, wet.”  A neighbor also testified to having fallen in the same area that same day.  The neighbor agreed that water from melting snow and ice would tend to drain across the sidewalk and re-freeze, but he wasn’t sure where the ice that caused his fall had come from.

The former property manager testified that although there were areas where water would drain “up against the building,” she was not aware of any drainage or water pooling issues on the sidewalk where plaintiff fell.  The property manager at the time of the fall also testified, acknowledging that photographs seemed to show standing water on the sidewalk, but denying that it was a “major pooling issue.”

Defendants moved for summary judgment on four grounds: (1) immunity under the Snow and Ice Removal Act; (2) the defendants had no duty to remove natural accumulations, and the plaintiff had failed to show that the ice where she fell was an unnatural accumulation; (3) lack of defect in the property; and (4) there was no ice present on the day of the fall.  While the motion was pending, the plaintiff was granted leave to file a fourth amended complaint, adding claims of inadequate maintenance and negligent landscaping.  The trial court granted the defendants’ motion, holding that immunity under the Act was broader than merely allegations of negligent snow or ice removal.

The First District reversed.  The Court found that the common law rule that there is no duty for a landowner to remove natural accumulations of ice or snow had a traditional exception when design, construction or maintenance of the premises made the accumulation unnatural – in other words, the landowner is not obligated to protect others from the effects of the elements, but can be held liable for essentially making the risk worse.

On appeal, the plaintiff argued that the Act was limited to immunity for injuries resulting from unnatural accumulations created by efforts to remove ice and snow.  Immunity didn’t attach pursuant to her allegations, plaintiff claimed, because she did not allege that the defendants had made any effort to remove the ice on which she fell; instead, she claimed to have fallen on an ice patch created by faulty maintenance and/or drainage planning.  The defendants responded that the case was about snow and ice removal, and the plaintiff was merely trying to circumvent the act.  According to the defendants, the immunity under the Act is not affected by any purported defects in the property.

The Appellate Court concluded that immunity under the Act did not extend to cases like plaintiff’s, where the alleged negligence arose from design, construction and maintenance rather than snow and ice removal.  The Court declined to follow the decision in Ryan v. Glen Ellyn Raintree Condominium Ass’n, in which the Second District had held that even when defects in the property caused an unnatural accumulation, the owner could still avoid liability by clearing or neutralizing the accumulations prior to an accident.  The defendants argued for affirmance on several alternative grounds, but the Appellate Court declined to consider those additional issues, finding that there was no evidence that the trial court had actually decided the defendants’ additional claims.

We expect Murphy-Hylton to be decided this winter.

Image courtesy of Flickr by Paul Pierce (no changes).

Illinois Supreme Court Agrees to Clarify Administrative Review Issues in Teacher Termination Case

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Just how much deference are downstate boards of education required to grant the decisions of hearing officers in connection with disciplinary proceedings for teachers?  The Illinois Supreme Court agreed to clarify that issue, allowing a petition for leave to appeal in Beggs v. Board of Education of Murphysboro Community Unit School District No. 186, a decision from the Fifth District.

The plaintiff began employment as a full-time high school teacher for the District during the 1993-94 school year.  Until 2011, she never received an unsatisfactory evaluation or one that rated her as needing improvement.  However, following the death of her father in the summer of 2011, her mother’s health began to deteriorate.  She missed a significant number of days in the 2011-12 school year helping care for her mother.  The District, which was aware of her mother’s situation, became increasingly concerned about her late arrivals and failure to be prepared, finally issuing a letter of concern in January 2012.  The plaintiff was suspended without pay between February 10 and 21, 2012, and the school board authorized a notice of remedial warning in late February 2012.

The plaintiff returned to work, but requested and received a leave of absence from February 27 to March 14, 2012 to continue caring for her mother.  She missed additional days in late March, and finally, in late April, 2012, the Board adopted a resolution to authorize her dismissal.  The plaintiff’s mother died shortly after the dismissal.

The plaintiff timely requested a hearing before a jointly selected impartial hearing officer. The hearing officer made findings of fact and recommended that the plaintiff be reinstated.  The Board incorporated the hearing officer’s findings of fact and made supplemental findings, but ultimately concluding that the hearing officer’s recommendation that the teacher be rehired was contrary to the manifest weight of the evidence.  On administrative review, the Circuit Court reversed the Board, holding that dismissal was unwarranted and ordering the plaintiff’s reinstatement with back wages and benefits.

The Fifth District affirmed, holding that the Board had given insufficient deference to the hearing officer’s findings of fact.  The hearing officer had concluded that the performance issues displayed by plaintiff during her mother’s decline represented an anomaly in her teaching career, and that at a minimum, the plaintiff should be given an adequate opportunity to prove that that was the case.

Pursuant to Senate Bill 7, enacted in 2011, the Illinois General Assembly provided that for downstate teacher dismissals, although hearing officers should provide a report and recommendation, final decision-making authority would remain with local boards of education.  Nevertheless, the Board was required to incorporate the hearing officer’s factual findings unless it determined that those findings were against the manifest weight of the evidence.

The Fifth District held that pursuant to the 2011 statute, the Legislature intended that although a Board can depart from the hearing officer’s recommendation, such a departure should be an unusual occurrence that would produce careful scrutiny from a reviewing court.  The court concluded that “a certain level of deference” should be accorded to the hearing officer’s findings and recommendation.

The Court first found that the Board’s decision to reject the hearing officer’s conclusions regarding the plaintiff’s allegedly improper use of class time was error.  The hearing officer’s factual findings were not unreasonable, according to the Court, and the hearing officer’s decision to reject his findings was not sufficiently supported by the amended and supplemental facts found by the Board.  Nor were the hearing officer’s findings rejecting the charge of lateness unreasonable, the Court found.  Finally, the Court found that the hearing officer’s rejection of the allegation that the plaintiff had failed to have lesson plans available in a timely manner was reasonable as well, and the Board’s rejection of that finding was therefore error.  Ultimately, the Court found that none of the stated violations by the Board could pass muster on the required standard of review of a hearing officer’s determinations, and accordingly, the decision reversing the dismissal had to be affirmed.

We expect Beggs to be decided this winter.

Image courtesy of Flickr by Alex Liivet (no changes).

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