In the closing days of its November term, the Illinois Supreme Court agreed to decide whether a pension board’s finding that an officer is disabled for pension purposes is preclusive of the employer’s liability for health insurance premiums under the Public Safety Employees Act. In The Village of Vernon Hills v. Heelan, the Second District held that the answer was yes.
The defendant officer was injured in the line of duty in December 2009. During the year following the incident, the officer was paid his full salary by the village pursuant to the Public Employee Disability Act. He underwent one hip replacement in April 2010. His condition worsened, and the other hip was replaced in September 2010. He did not return to work after the second surgery. In August 2011, the Board of Trustees of the Police Pension Fund held that the officer qualified for a line-of-duty disability pension.
A month after the Board’s ruling, the village filed a complaint seeking a declaratory judgment that the officer was not entitled to health insurance benefits under the Public Safety Employees Act. In its complaint, the village alleged that the officer had not suffered a catastrophic injury in response to what he reasonably believed to be an emergency, as required by the Act. (820 ILCS 320/10.)
The village acknowledged the Supreme Court’s holding in Krohe v. City of Bloomington that a catastrophic injury under the Act was the same thing as in injury sufficient to result in a line-of-duty pension. The village argued that Krohe was factually distinguishable and wrongly decided. The officer counterclaimed seeking a declaratory judgment holding that the village was obligated to provide the health care premium benefits.
The officer filed a motion in limine to bar any testimony on the issue of whether he had suffered a catastrophic injury under the Act. The court granted the motion. Subsequently, the case proceeded to a bench trial. The village conceded Section 10(b) of the Act was satisfied. In light of the Court’s in limine order, the village made an offer of proof on the issue of catastrophic injury and emergency. The officer then moved for a directed finding on the village’s claim, which the court granted. The court subsequently found for the officer on his counterclaim as well.
After entry of judgment, the officer filed a motion for sanctions against the village under Supreme Court Rule 137, arguing that the village had brought its suit solely for purposes of harassment. The court denied the motion, finding that the village had brought its suit in good faith, arguing from the outset that it was seeking to change the law.
The Appellate Court affirmed, finding that Krohe controlled. Accordingly, the Board’s finding that the officer was injured in the line of duty and therefore entitled to a line-of-duty pension necessarily amounted to a finding that he sustained a catastrophic injury in responding to an emergency within the meaning of the Act.
The village argued that the issue was actually a matter of collateral estoppel, and since it wasn’t involved in the pension proceeding, the Board’s ruling was not preclusive. The Court rejected the village’s argument, concluding that the village was making a precluded collateral attack on the Board’s decision.
The officer cross-appealed from the trial court’s denial of his Rule 137 motion. The Appellate Court affirmed the trial court, noting that the village had made it clear from the outset that it was bringing a frontal challenge to Krohe in hopes of changing the law.
Justice McLaren dissented, arguing that the “findings of an administrative agency” could not be binding “on a trial court in a separate proceeding with different parties regarding matters that the administrative agency has no statutory authority to decide.”
We expect Village of Vernon Hills to be decided within eight to ten months.