author: PRESIDING JUSTICE EGAN

text:
    VELMA HIGHTOWER et al., Indiv., and on behalf of their children, et al., Plaintiffs-Appellants, v. EDWARD DUFFY, Director of Illinois Department of Public Aid, et al., Defendants-Appellees.
    First District (6th Division)
    Nos. 1—87—3399, 1—88—2949 cons.
    Opinion filed December 1, 1989.

      Legal Assistance Foundation, of Chicago (John M. Bouman, Robert E. Lehrer, and Margaret Stapleton, of counsel), for appellants.
    Neil F. Hartigan, Attorney General, of Springfield (Robert Ruiz, Solicitor General, and Karen Konieczny, Assistant Attorney General, of Chicago, of counsel), for appellees.
   PRESIDING JUSTICE EGAN

delivered the opinion of the court:

Two groups of plaintiffs, the Hightowers and Toneys, appeal from an order of Judge Roger J. Kiley dismissing their complaint (Hightower complaint); and another group of plaintiffs, the Clarks, appeal from an order of Judge Kenneth L. Gillis dismissing their complaint 0Clark complaint). The appeals have been consolidated because they have some issues in common. They concern the rights of public assistance recipients. The principal contention in both complaints was that a plan adopted by the Illinois Department of Public Aid (Department) violates an Illinois statute and the Social Security Act. In only the Clark case was the contention decided on the merits. The Hightower case was dismissed on a procedural ground.

Background

The Social Security Act established a Federal-State public assistance program for families with dependent children (AFDC Program). (42 U.S.C. §601 et seq. (1982).) The Program is based essentially on a scheme of cooperative federalism. The Federal government finances the Program on a matching fund basis. States are not required to participate in the Program. However, those who choose to take advantage of substantial Federal funds available for aid must comply with certain Federal rules and regulations.

Illinois has chosen to participate in the AFDC Program. (Ill. Rev. Stat. 1985, ch. 23, par. 4 — 1 et seq.) The legislature created several programs of assistance which offer various types of assistance to different groups of people. The Aid to Families with Dependent Children (AFDC) and General Assistance (GA) programs are two such programs. The GA program, which is funded solely by the State, provides cash assistance and other services, including limited medical coverage, to families with children who do not qualify for the AFDC program. (Ill. Rev. Stat. 1987, ch. 23, par. 6 — 1 et seq.) The Department administers both the AFDC and the GA programs. (Ill. Rev. Stat. 1987, ch. 23, par. 12 — 1 et seq.) In the City of Chicago, the Department administers the GA program, and the State funds 100% of the program. Outside Chicago, local counties or townships administer the GA program; and joint State and local efforts or entirely local efforts fund the program.

Two basic factors account for the amount of financial assistance provided to any eligible AFDC or GA family. The first factor is the “standard of need,” which is the minimum level determined by computing the cost of items considered necessary for subsistence. The second factor is the “aid payment” itself, which is the actual amount of financial assistance provided.

Before October 1, 1973, the standard of need and grant levels for AFDC families was determined generally on a case-by-case basis. The standard of need for each family was determined by totalling the sum of specified basic needs considered necessary for all recipients (i.e, food, shelter, personal essentials, clothing) and a number of variable special needs under certain circumstances (e.g., special diets for diabetics).

As of October 1, 1973, Federal law and Illinois law permitted Illinois to “consolidate” its AFDC standard of need and grant structure. This consolidation resulted in averaging some or all of the sums representing the individually determined needs into the standard of need for all AFDC families. Consequently, the Department instituted the Illinois Consolidated Standard Plan, effective October 1, 1973, which sought to consolidate the AFDC standard and grant structure in accordance with Federal and State law.

As implemented, the consolidated standard of need for AFDC families varied by only three factors: the size of the family, the composition of the family (adult caretaker and child or child only), and the family’s county of residence. The State was divided into three county groups: Group I included Cook County and other more populous counties; Group II included less populous counties; and Group III included rural, relatively sparsely populated counties. Under such consolidation, all families of the same size, composition, and residence (with no other countable income) were computed to have the same standard of need and received the same grant. Generally, the amount of an eligible family’s grant depended upon a basic payment level for that family minus the amount of the family’s countable income (countable for public assistance purposes, such as Social Security benefits). Although neither Federal nor State law required it, the Department paid eligible families 100% of their applicable standard of need. By 1978, the Department had fully adopted the same consolidated standard for families in the State-funded GA program as well.

In October 1981 the Department changed the formula for its AFDC and GA family standards. However, rather than consolidate its existing standards as it did in 1973, the Department utilized an entirely different statistical base and adjusted the family standards of need significantly upwards; but the percentages paid were no longer 100%.

Aid payments continued to vary by the same three factors that were decisive in the previous program’s standards: family size, composition, and county of residence. Although the Department’s change in formula adjusted family standards of need significantly upward, aid payment levels remained the same. This meant that aid payments for any family became less than or only a percentage of the new higher standard of need for that family. Under this change, the Department paid eligible families of different sizes unequal percentages of the applicable standard of need. For example, the Department granted a four-person (adult and children) family in Cook County (Group I) benefits equalling 62% of its standard (Payment Level = $368; Standard of Need = $593), whereas it granted a two-person (adult and child) family in Cook County benefits equalling approximately 75% of its standard (Payment Level = $250; Standard of Need = $332). The Department granted a four-person (children only) family in Group II benefits equalling 62.2% of its standard (Payment Level = $275; Standard of Need = $442), whereas it granted a two-person (adult and child) family in Group II benefits equalling approximately 72.3% of its standard (Payment Level = $236; Standard of Need = $326). Officials of the Federal Department of Health and Human Services criticized the lack of uniformity in the Illinois payment system.

Beginning in 1981, the Department adjusted upward both AFDC and GA standards and aid payments for families in accordance with cost of living increases. In addition, the Department allocated these upward adjustments to families in a manner designed to ensure that all families would ultimately be paid equal percentages of their standard of need. As a result, families being paid a lower percentage of their standard of need generally received higher upward grant adjustments than families being paid a higher percentage of their standard of need.

In 1984 the legislature expressly recognized rising energy costs and directed that “[djuring the first month” that the Department paid grants, which included amounts for energy payments, the amounts of the grants were to “be adjusted to approach more closely a single percentage of the standard of assistance established” by the Department. (Ill. Rev. Stat. 1985, ch. 23, par. 12 — 4.11.) The next paragraph of that section of the Act was amended to add an additional basis for reduction of payments: “[To] accomplish the adjustment described in the preceding paragraph.”

In January 1985 the Department provided a grant increase and simultaneously equalized the percentage of standards for family sizes one through six in Group I and II counties and family sizes one through eight in Group III counties, which represented over 98% of the family case load. This left only larger-sized families and child-only families to be equalized, which, by the Department’s estimate, consisted of between 4,000 and 5,000 families.

In May 1986 the Department of Health and Human Services again criticized the Department’s plan because of a perceived lack of uniformity and “threatened to declare Illinois in non-compliance with federal law.” On January 1, 1987, in response to that criticism, the Department promulgated a rule which established, in effect, two levels for payments: one for those “assistance units” in existence before January 1, 1987, and the other for “assistance units” which would come into existence after January 1. Those in existence before January 1 were to be “grandfathered,” that is, were to remain in effect at higher levels than those which would come into existence after January 1. The rule also provided that grandfathered status would be lost by a change in the assistance unit by an addition or deletion of an “assistance unit member” or “if the grandfather case is cancelled,” for example, by a family going off assistance altogether.

THE PARTIES

The plaintiffs, Velma and Melvin Hightower and their seven children, had been receiving $649 per month in public assistance since 1986. On February 13, 1987, Velma gave birth to her eighth child. Based on her report that her family had increased, the Department notified her that she had lost her grandfathered status by an increase in her family and reduced her family’s payments to $623 per month. The Department upheld the decision to reduce the family’s monthly benefits and denied her internal administrative appeal.

The plaintiffs, Linda Toney and her eight minor children, first applied for assistance after January 1, 1987, and, therefore, did not have grandfathered status. She received $167 per month. (She had other countable income.) If she had applied before January 1, she would have received $225 per month. She also filed an administrative appeal; while the appeal was pending, she gave birth to her ninth child. Her award was increased to $199. She claimed that the family should receive the pre-January 1987 amount of $276. On June 25, 1987, after an administrative hearing, the Department upheld the decision to pay the Toney family the lower assistance amount.

The plaintiffs, Janet and Ronald Clark and their six minor children, were receiving $591 per month in 1986 and continued to receive that amount through June 1987. At that time, she and her children moved out of their home. The Department reduced her payments to $534. Under the rates effective before January 1, 1987, she would have received a monthly grant of $556. In September 1987, her husband rejoined the family, and Janet Clark requested that she be restored to the rates in existence before January 1. The Department refused on the ground that her grandfathered status had been can-celled.

To summarize, the Hightowers lost their grandfathered status because their family increased; the Clarks lost their grandfathered status because their family temporarily decreased; and Toney never had grandfathered status.

The defendants are the Illinois Department of Public Aid (Department) and Susan Suter, the present Director of Public Aid, who succeeded Edward Duffy, one of the original defendants.

THE PLEADINGS

On June 12, 1987, Velma Hightower filed an individual complaint for administrative review in the circuit court. On July 24, 1987, she and her husband, Melvin Hightower, were granted leave to file a four-count amended complaint. Counts I, II and III of the amended complaint were class action counts. The named plaintiffs in counts I and II include Velma and Melvin Hightower and their children and Linda Toney and her children; only the Hightowers are named in count III. The plaintiffs sought class-wide declaratory, and injunctive relief under the Illinois Public Aid Code (count I), the Social Security Act (count II) and the United States and Illinois Constitutions (count III). Count IV was Hightower’s individual claim under the Administrative Review Act. Toney separately filed an individual complaint for administrative review on July 30, 1987. The Toney complaint for administrative review was consolidated with the Hightower amended complaint and assigned to Judge Roger Kiley.

On October 19, 1987, Janet and Ronald Clark and their children filed a two-count complaint. Count I was brought on behalf of a class including AFDC and GA applicants and recipients and alleged a violation of the Illinois Public Aid Code. (Ill. Rev. Stat. 1985, ch. 23, par. 12 — 4.11.) Count II was brought on behalf of a class including only AFDC applicants and recipients and alleged a violation of the Social Security Act. (42 U.S.C. §§602(a)(l), (a)(10) (1982); 45 C.F.R. §233.1 (1988).) The plaintiffs sought declaratory and injunctive relief under both counts. The Clark case was assigned to Judge Kenneth L. Gillis.

We pause to point out that the class claims of counts I and II of the Hightower complaint are the same class claims as counts I and II of the Clark complaint. The Clark complaint does not contain a constitutional claim. The Clarks never sought administrative review.

TRIAL COURT PROCEEDINGS

On October 8, 1987, Judge Kiley allowed the defendants’ motion to dismiss counts I, II and III of the Hightower complaint. The issue of class certification was never decided. Basing the dismissal on his interpretation of People ex rel. Naughton v. Swank (1974), 58 Ill. 2d 95, 317 N.E.2d 499, he said that he possessed jurisdiction only over the administrative review proceedings since the plaintiffs had invoked jurisdiction only over the administrative complaint initially filed by Hightower, and he had no authority to enlarge its context to include other claims. After notice of appeal from the order of dismissal was filed, Judge Kiley ruled in favor of Hightower and Toney in their administrative review complaints. He held that the rule adopted by the Department on January 1, 1987, violated section 12 — 4.11 of the Illinois Public Aid Code (Ill. Rev. Stat. 1985, ch. 23, par. 12 — 4.11). We note at this point that the administrative review claims were based on the same legal argument as count I of the Hightower and Clark complaints. The Department did not appeal Judge Kiley’s ruling in favor of Hightower and Toney. We do not have the report of proceedings before Judge Kiley when he ruled. The order simply recites, in effect, that the January 1, 1987, regulation should be held for naught. Therefore, we cannot be certain of the grounds upon which Judge Kiley based his ruling.

In the Clark action, Judge Gillis allowed class certification, but he came to a conclusion opposite to that reached by Judge Kiley. Judge Gillis allowed the defendants’ motion for summary judgment and held that the rule adopted by the Department on January 1, 1987, did not violate the Illinois Public Aid Code (Ill. Rev. Stat. 1985, par. 23, par. 12—4.11) or the Social Security Act (42 U.S.C. §§ 602(a)(1), (a)(10) (1982)).

THE CLARK APPEAL

The defendants have filed a motion to dismiss the Hightower appeal, in part, on the ground that the judgment in the Clark case was res judicata on an issue in the Hightower case, because Clark is a member of the Hightower class. Since our decision in the Clark case will bear on the motion to dismiss in the Hightower case, we will consider the Clark appeal first.

A. THE STATE STATUTE

As previously noted, the Illinois Public Aid Code was amended effective January 1, 1985 (Ill. Rev. Stat. 1985, ch. 23, par. 12—4.11). Before that amendment, aid payments could be reduced for (1) changes in the cost of items included in the standard of need, (2) changes in the expenses of the recipient, (3) changes in the income or resources available to the recipient or (4) changes in grants resulting from adoption of a consolidated standard of need. That amendment added a fifth ground for possible reduction of payments: “[T]o accomplish the adjustment described in the [newly added] preceding paragraph.”

The “preceding paragraph” referred to in the above-quoted language, in turn, refers to another newly added “preceding paragraph.” Consequently, clarity requires that both “preceding” paragraphs be set forth:

“In recognition of the inability of low income households to afford the rising costs of energy, payments made by the Department under Articles IV and VI shall include an amount of money to offset, in whole or in part, the costs of energy associated with seasonal variations. The Department may by rule establish the amount of such energy payments which may vary in accordance with the size of the assistance unit. The Department for reasons of administrative simplicity may provide such amounts in equal monthly payments.
During the first month that the Department pays grants which include amounts authorized in the preceding paragraph, such grant amounts for all sized assistance units within each program the Department administers under Article IV of this Code and for assistance units of more than one person under Article VI of this Code shall be adjusted to approach more closely a single percentage of the standard of assistance established under this Section, with grant amounts expressed in whole dollar amounts. The percentage used for Article IV need not be the same percentage used for Article VI. Federal Energy Assistance money provided in a separate payment and identified as being exclusively for energy assistance shall not be considered as part of the grant for the purposes of this paragraph; all of the grant amount, including any portion thereof that may be provided for the purpose of energy assistance provided under the preceding paragraph, shall be considered under this paragraph.”

The Department agrees that no reduction in payments will be permitted unless it comes within an exception set out in the statute. (Heinrich v. Illinois Department of Public Aid (1970), 129 Ill. App. 2d 65, 262 N.E.2d 785.) And the plaintiffs agree that the plan adopted in 1985 by which payments were reduced for at least some of the aid recipients met the requirements of the fifth exception. But it is the plaintiffs’ contention that the exception ceased to exist after January 1985. In short, the plaintiffs argue that the statute is one of empowerment and that the power died after January 1985. The defendants disagree and argue that the statute is mandatory, that is, that the legislature required the equalization of all percentages of payments but did not set any timetable for the Department to act. We do not agree with either construction; although we concede that the amended statute is not a model of clarity and the arguments advanced by the parties are not to be lightly dismissed.

It is true, as the defendants argue, that the statute provides that the grants “shall be adjusted” and that “shall” is generally interpreted to be mandatory, and not directory, unless the context of the statute indicates otherwise. (In re Application of Rosewell (1983), 97 Ill. 2d 434, 454 N.E.2d 997.) It is the primary rule of statutory construction that the intention of the legislature should be ascertained and given effect. (People v. Robinson (1982), 89 Ill. 2d 469, 433 N.E.2d 647.) No formalistic rule of grammar or word form should stand in the way of carrying out the legislative intent. Consideration must be given to the legislative history, the language of the statute, its subject matter, the importance of its provisions, the relation to the general object intended to be accomplished by the act, and finally, whether or not there is a public or private right involved. Rosewell, 97 Ill. 2d at 440.

It is our judgment that the statute is directory and not mandatory. To begin, the Public Aid Code, considered as a whole, evidences legislative recognition of the great responsibility imposed on the Department of Public Aid and the need that a wide range of discretion be given the Department. The Code empowers the Department to “[establish specific standards, by rule, by which grant amounts and need for public aid will be determined” and authorizes the Department to “amend such standards from time to time as circumstances may require.” Ill. Rev. Stat. 1987, ch. 23, par. 12—4.11.

Section 12 — 4 refers to “powers, duties and functions of the Department” and identifies section 12 — 4.11 as a power granted, not a duty. The only restriction on the power granted by section 12 — 4.11 to fix standards is the requirement that the standards be established “by rule.”

More important, however, is the language of the provision itself: the grant amount “shall be adjusted to approach more closely a single percentage of the standard of assistance.” (Emphasis added.) (Ill. Rev. Stat. 1987, ch. 23, par. 12—4.11.) Language of a statute that an agency shall “approach more closely” a single percentage is not the stuff of which mandates are made. It should be obvious that whether a percentage “approaches” other percentages “more closely” calls into play a considerable amount of discretion on the part of the Department. Where a statute reposes discretion, it is directory and not mandatory. See Tuthill v. Rendleman (1944), 387 Ill. 321, 56 N.E.2d 375.

Last, it is clear that the Department itself did not construe the language to be mandatory, as evidenced by its exemption of 2% of aid recipients. The interpretation of a statute by the agency charged with the administration of the statute is entitled to substantial deference. (Eddings v. Department of Labor (1986), 146 Ill. App. 3d 62, 496 N.E.2d 1167.) The belated and somewhat astonishing suggestion of the Department that its exemption of certain classes of families was a benevolent, but nonetheless ultra vires, act is not persuasive. For these reasons we hold that the act did not impose a mandatory duty on the Department to equalize the percentage of the standards of assistance.

On the other hand, we do not agree with the plaintiffs’ claim that the legislature intended to grant the Department only the month of January 1985 to effectuate any plan under section 12 — 4.11 which would result in a reduction in payments.

The judge expressed the reasons for his ruling. Among them were his perceived results of the plaintiffs’ construction and “common sense.” The plaintiffs’ opening brief raised arguments against the reasons ascribed by the trial judge; but, as the plaintiffs correctly note in their reply brief, the defendants did not respond to the plaintiffs’ argument. We agree with the plaintiffs that the defendants have apparently refused to adopt the reasoning of the trial judge. Under some circumstances the defendants’ refusal to answer the plaintiffs’ argument might be considered a waiver; but a reviewing court’s responsibility for a just result and for the maintenance of a sound and uniform body of precedent may sometimes override considerations of waiver. (Hux v. Raben (1967), 38 Ill. 2d 223, 230 N.E.2d 831.) Moreover, this case involves an issue of considerable public importance. Therefore, the arguments against the judge’s reasoning made by the plaintiffs, but not answered by the defendants, have been considered by this court; and we agree, in substance, with the reasoning of the trial judge.

An expansion of the plaintiffs’ argument is required. The plaintiffs concede that the Department would have acted properly, if, in the month of January 1985, it had thrown the equalization net over all the recipients of public aid, regardless of the depth of the reductions and how many people were affected; but, they argue, by letting 2% of the recipients to escape the net, it lost not only that 2% irretrievably, but all future applicants situated similarly to the fortunate 2% — for example, the plaintiff Toney. In short, the Department had its chance but missed it.

That construction of a statute will be avoided which would lead to an absurd or unjust result. (Harris v. Manor Healthcare Corp. (1986), 111 Ill. 2d 350, 489 N.E.2d 1374.) If the plaintiffs’ interpretation of legislative intent is correct, the legislature knowingly gave power to the Department for 31 days with unfettered discretion to reduce payments for some aid recipients but to exercise largesse for the others. In our judgment, such a result would be unjust and unreasonable.

In determining legislative intent, it is proper to consider the legislative history, the reason for enactment and the circumstances that led to its adoption. (In re Marriage of Logston (1984), 103 Ill. 2d 266, 469 N.E.2d 167.) The history of the administration of the Public Aid Code and its relation to the Social Security Act discloses the breadth and depth of the long-standing problem facing the Department in the fixing of public aid payments and in complying with Federal regulations. Knowing the problems faced by the Department for at least 10 years and the attempts by the Department, covering a period of years, to satisfy the Federal agency, it is inconceivable to us that the legislature would give the Department only the ephemeral power as suggested by the plaintiff and require the Department to solve the problem in 31 days. It is not probative on the question of legislative intent, as the plaintiffs argue, that the Department was able to equalize 98% of the recipients in a short period of time. Nor do we find persuasive the plaintiffs’ argument that equalization could have been achieved without reduction. (We will discuss the validity of that argument later.) The narrow issue before us is not whether the Department acted wisely or efficiently; the issue is whether it was required to act during a 31-day period only.

While the plaintiffs have resisted the defendants’ argument that the statute imposed a mandatory duty on the Department to equalize standards, the thrust of their own argument is that it was mandatory on the Department to exercise its discretionary power within 31 days, or not at all. Express statutory time limitations imposed upon public officers have been considered in a number of cases. It is the general rule that if a provision of a statute states the time for performance of an official duty, without any language denying performance after a specified time, it is directory. However, if the time period is provided to safeguard someone’s rights, it is mandatory, and the agency cannot perform its official duty after the time requirement has passed. (Andrews v. Foxworthy (1978), 71 Ill. 2d 13, 373 N.E.2d 1332.) We point out that the statute does not express a time limitation. Instead, we are asked to infer that the expiration of the 31 days of January 1985 ended the Department’s power to act. The plaintiffs have cited no case in support of the proposition that a mandatory time limitation may be inferred; and our research has disclosed none.

The heart of the plaintiffs’ argument is that the power to adjust percentages was inextricably tied to the initial energy payments made and is based on the assumption that energy payments could be made only in the month of January 1985. That is an unfounded assumption. There is no such limitation in the Act. The statute simply provides that the adjustment shall be made “[djuring the first month that the Department pays grants” which include energy payments. Our reading of the Act leads to the contrary conclusion that energy payments might be made at anytime. It would not have required any particular dexterity in draftsmanship for the legislature to say what the plaintiffs contend that it meant to say. The fact is that the legislature did not say it, and we conclude that the legislature did not mean to say it.

For these reasons, we hold that the action of the defendants in promulgating the plan in January 1987 did not contravene chapter 23, section 12 — 4.11.

B. THE SOCIAL SECURITY ACT

In count II of their amended complaint, the plaintiffs contend that the Department’s Plan violates the Social Security Act and its implementing Federal regulation. The statute provides, in part, as follows:

“A State [AFDC] plan *** must (1) provide that it shall be in effect in all political subdivisions of the State ***;
(10)(A) provide that *** aid to families with dependent children shall *** be furnished with reasonable promptness to all eligible individuals ***.” 42 U.S.C. §§602 (a)(1), (a)(10) (1982).

The regulation provides, in part, as follows:

“(a) State plan requirements. A State [AFDC] plan *** must:
(1) Specify the groups of individuals, based on reasonable classifications, that will be included in the program, and all the conditions of eligibility that must be met by the individuals in the groups. The groups selected for inclusion in the plan and the eligibility conditions imposed must not exclude individuals or groups on an arbitrary or unreasonable basis, and must not result in inequitable treatment of individuals or groups in the light of the provisions and purposes of the public assistance titles of the Social Security Act. Under this requirement:
(iv) Eligibility conditions must be applied on a consistent and equitable basis throughout the State.” 45 C.F.R. §233.10(a)(l)(iv) (1988).

Reduced to its most simple terms, regulation 45 C.F.R. §233.10(a)(1) (1988) (“the equitable treatment regulation”) requires that State public assistance officials “treat like things alike.” (Watkins v. Blinzinger (7th Cir. 1986), 789 F.2d 474, 481.) In this case, the plaintiffs contend that the grandfather regulation does not “treat like things alike” in that a family group in existence before January 1987 receives a larger monthly grant than a similarly situated group that first receives public assistance after January 1987.

At the outset we express recognition that the cases cited by the Department do not involve the equitable treatment regulation: Jefferson v. Hackney (1972), 406 U.S. 535, 32 L. Ed. 2d 285, 92 S. Ct. 1724; King v. Smith (1968), 392 U.S. 309, 20 L. Ed. 2d 1118, 88 S. Ct. 2128; Dandridge v. Williams (1970), 397 U.S. 471, 25 L. Ed. 2d 491, 90 S. Ct. 1153; and Mitchell v. Blinzinger (N.D. Ind. 1986), 646 F. Supp. 66.

The plaintiffs have cited cases in which the courts have held that a State regulation violated the equitable treatment regulation: Blum v. Bacon (1982), 457 U.S. 132, 72 L. Ed. 2d 728, 102 S. Ct. 2355; Rosado v. Wyman (1970), 397 U.S. 397, 25 L. Ed. 2d 442, 90 S. Ct. 1207; and Martinez v. Trainor (N.D. Ill. 1976), 435 F. Supp. 440.

In Blum v. Bacon, the Supreme Court struck down a New York regulation that excluded emergency assistance to AFDC recipients but provided such assistance to other public aid recipients. In Rosado v. Wyman, the court invalidated a New York regulation that provided higher payments to AFDC recipients in New York City than to recipients in Nassau County. In Martinez v. Trainor, the plaintiffs successfully challenged the Department’s rule which paid lower benefits to mothers under 21 years of age than those paid to otherwise identically situated mothers over 21 years of age.

We do not believe that any of the plaintiffs’ cases are factually apposite or controlling here. All involved final and permanent State regulations; none of them dealt with a regulation whereby the public aid agency sought to gradually effect a plan which,, it hoped, would ultimately satisfy the Federal agency that was a major source of its funding.

The trial judge based his ruling, in part, on his conclusion that the grandfather regulation was a “benevolent provision which allowed people who had become accustomed to a particular standard to stay on that standard” and was “reasonable.” He held that the equitable treatment regulation did not require “immediate compliance” and that the Department had “the right to cushion changes and to not make them immediate.” He identified the inequitable treatment as one existing “in the short run.” Once again we agree with the substance of the trial judge’s reasoning.

The plaintiffs have advanced several arguments against the reasoning of the trial judge. One of those arguments vividly illustrates the quandary the Department faced in its attempt to ensure that Federal funds would be available. The 1985 statute itself and the 1987 regulation were prompted by warnings from the Department of Health and Human Services that the Illinois Department’s practices were contrary to Federal law and that Illinois might lose its right to Federal funds. The plaintiffs now tell us that the local Federal administrator’s interpretation of the law was wrong and is entitled to no deference. In substance, the plaintiffs argue, the Department should have ignored the Federal administrator’s warnings, thrown down the gauntlet, litigated the matter and taken its chances on losing Federal funds. We find no persuasiveness in this argument. Besides, whether the Federal administrator was right when he warned the defendants that the right of Illinois to Federal funds was in jeopardy is not properly before us. The question has not been briefed nor appropriately argued. We point out that the plaintiff did not make the Secretary of Health and Human Services a party to this action.

The plaintiffs also argue that the Department had two options available after 1985: It could have adopted the plan it did; or it could have adopted a plan now suggested by the plaintiffs. (We will discuss the plaintiffs’ plan later.) We disagree that the Department had only two options: It had, and has, the third option of scrapping the grandfather provision completely. The plaintiffs’ failure to include this third option is apparently based on their erroneous assumption that after January 1985 the Department was powerless to effect any reductions.

The plaintiffs’ principal argument, set forth in their brief, is that equalization could have been, and can be, achieved without reductions:

“It may do so by selectively allocating money made available for grant increases to families being paid a lower percentage of the standard of need, and withholding any increases from families being paid a higher percentage of the standard of need, until the grants of all families are ‘fully equalized’.” (Emphasis added.)

While we have some difficulty understanding the mechanics of “selectively” allocating money and “selectively” withholding any increases, it is clear to us that the plaintiffs’ suggested plan, again as expressed in their brief, depends on the amount of money available:

“At any given time, a state may make equalization adjustments in two basic ways, depending on whether it has additional dollars to put into the public assistance pot. If a state has no additional dollars to allocate to grants, it will have to reduce grants to make progress on equalization. If a state does have additional dollars to allocate to grants, it can make equalization adjustments without reducing grants and, if there is enough additional money, it can accomplish full equalization in one set of grant adjustments without reductions.
If a public aid department is required to equalize its grants completely in one set of adjustments (i.e., adjustments made at single time), but there is no additional money for the grants or not enough money to pay the necessary increases, then it will have to reduce grants to achieve the full equalization goal.” (Emphasis added.)

It thus appears that the plaintiffs’ plan is presumptively based on an uncertain underpinning: legislative beneficence.

The plaintiffs concede that the length of time for equalization under their plan depends on how long it takes for the necessary funds to be appropriated. They also concede that under their plan some families receiving public assistance who need larger grants will not receive them and that some families could continue to receive a higher percentage of the standard of need than other similarly situated families. How long that condition would exist depends on how much the legislature appropriates. The plaintiffs also recognize that all those now enjoying grandfathered status will lose that status some time in the unknown future.

We judge the plaintiffs’ argument to be that, while its own plan has equitable shortcomings, it is a better one than the Department adopted. In addition to a repeated reference to the shaky fiscal basis of the plaintiffs’ argument, an appropriate answer to their suggestion that we should impose another plan on the Department is contained in Dandridge v. Williams (1970), 397 U.S. 471, 487, 25 L. Ed. 2d 491, 503, 90 S. Ct. 1153, 1162-63:

“We do not decide today that the Maryland regulation is wise, that it best fulfills the relevant social and economic objectives that Maryland might ideally espouse, or that a more just and humane system could not be devised. Conflicting claims of morality and intelligence are raised by opponents and proponents of almost every measure, certainly including the one before us. But the intractable economic, social, and even philosophical problems presented by public welfare assistance programs are not the business of this Court. The Constitution may impose certain procedural safeguards upon systems of welfare administration [citation]. But the Constitution does not empower this Court to second-guess state officials charged with the difficult responsibility of allocating limited public welfare funds among the myriad of potential recipients. [Citations.]”

In a similar vein, the Supreme Court has held that “[a] legislature may address a problem ‘one step at a time,’ or even ‘select one phase of one field and apply a remedy there, neglecting the others.’ ” (Jefferson v. Hackney (1972), 406 U.S. 535, 546, 32 L. Ed. 2d 285, 296, 92 S. Ct. 1724, 1731, quoting Williamson v. Lee Optical (1954), 348 U.S. 483, 489, 99 L. Ed. 563, 573, 75 S. Ct. 461, 465.) The observations of the Supreme Court in both Dandridge v. Williams and Jefferson v. Hackney were made in the context of the equal protection clause of the Constitution, but we believe the observations are of equal applicability in the context of the equitable treatment regulation.

It is our holding that the plan adopted by the Department, while not perfect and to some degree inequitable, represented a good-faith effort to comply with Federal directives that the Department had the right to accept as lawful, and at the same time to reduce the impact of its plan upon larger families. As we have pointed out, if we were to hold otherwise, the Department could be in complete compliance by immediately abrogating the plan. We refuse to believe that that is the end, “a boon to me too or no one,” desired by the plaintiffs. We repeat that the plaintiffs recognize that all those now grandfathered will lose that status someday. Consequently, we hold that the plan adopted by the Department in January 1987 does not contravene the Social Security Act or its attendant regulations.

For these reasons, the judgment of the circuit court on the Clark appeal is affirmed.

THE HIGHTOWER APPEAL

The Hightower complaint was dismissed by Judge Kiley, who held that he lacked jurisdiction to entertain the class claim because of the pendency of the administrative review complaint. The sole issue before us on the merits of the appeal is whether Judge Kiley properly refused to entertain the Hightower complaint. The defendants have filed a motion to dismiss the Hightower appeal on the grounds of mootness and res judicata. Although the plaintiffs have answered the argument on res judicata as though it were properly before us, we are uncertain that res judicata is a question to be decided in a reviewing court. We prefer to treat the argument as a part of the argument on mootness, since we believe our holding in the Clark appeal is pertinent to the question of mootness.

The defendants contend that the appeal is moot since Hightower and Toney have received the relief they sought under their complaints for administrative review. In support of their position the defendants cite People ex rel. Newdelman v. Weaver (1972), 50 Ill. 2d 237, 278 N.E.2d 81. In Newdelman, plaintiffs, who were not public aid recipients, sought mandamus and declaratory relief against the Department of Public Aid; and other plaintiffs, who were public aid recipients, alternatively sought administrative review of a Department decision. All claims contended that the Director of Public Aid was improperly withholding security rent deposits as provided by the Public Aid Code. The trial judge dismissed the claims for mandamus and declaratory relief; and the appellate court reversed. (People ex rel. Newdelman v. Swank (1970), 131 Ill. App. 2d 73, 264 N.E.2d 794.) The supreme court granted the Department leave to appeal.

While the case was pending in the appellate court, one of the public aid plaintiffs filed a separate action for administrative review. Her request for relief had been denied by the Department, and she made the same claim under the administrative review complaint that had been made in the mandamus and declaratory complaint. The circuit court ruled in her favor; and that judgment was affirmed in the appellate court. Figures v. Swank (1970), 128 Ill. App. 2d 211, 263 N.E.2d 599.

As a result of the Figures opinion, the Director of Public Aid issued a directive in which he authorized the granting of the relief sought in Newdelman to all future applicants. The supreme court held that the Newdelman appeal was moot, because the plaintiffs had received what they were seeking from the Department’s directive, that is, prospective relief.

That is not precisely the posture of this case. There has been no directive from the Director of Public Aid ordering prospective relief to all future claimants. To the contrary. We have been informed that after Judge Kiley’s decision in Toney’s favor on her administrative review complaint, which was not appealed by the Department, Toney secured employment and became ineligible for public aid benefits. However, in April 1988, after notice of appeal had been file in this case, Toney again applied for aid. The Department granted her application but paid her a lower benefit in accordance with the 1987 plan. In effect, the Department ignored the previous holding of Judge Kiley. Consequently, we do not believe that Newdelman is controlling.

An issue is moot when no actual rights or interests of the parties remain or where events occur which render it impossible for the reviewing court to grant effectual relief to either party. The court should not resolve moot issues merely to establish precedent or to guide potential future litigation. West Side Organization Health Services Corp. v. Thompson (1980), 79 Ill. 2d 503, 404 N.E.2d 208.

An exception to the mootness doctrine exists in certain cases involving the public interest. In addition to the degree of public interest involved, a court should consider whether it is desirable to make an authoritative determination of the question for guidance of public officials and whether the question is likely to recur. (Village of Palatine v. La Salle National Bank (1983), 112 Ill. App. 3d 885, 445 N.E.2d 1277.) This case does involve a substantial public interest, and we believe that it is desirable to make an authoritative determination of the question for the guidance of public officials. However, we have made that determination this day in the Clark appeal that the Department’s regulation does not contravene the Public Aid Code or the Social Security Act. That being so, the next question is whether the claims in the Clark appeal are the same claims in the Hightower and Toney appeals. The plaintiffs contend that res judicata does not apply because, they say, the requisite identities of parties and claims are not present. Stated briefly, we disagree. In our judgment, Clark, Toney and Hightower are all members of the same class, although each may be, in turn, a member of a subclass; and the claims are the same.

We also point out that the plaintiffs took a different position in the trial court. They moved for a consolidation of the Clark complaint, then pending before Judge Marovich, with the Hightower and Toney complaints for administrative review, then pending before Judge Kiley. They asked that after consolidation all cases be heard by Judge Kiley. In support of the motion, the plaintiffs said that the Hightower and Toney cases and the Clark case “present precisely the same federal and state substantive statutory claims against” the Department’s plan. They also said that the “legal claims [in all cases] are virtually identical.” It is apparent to us that counts I and II of the Hightower complaint would be barred under the doctrine of res judicata. Therefore, it would serve no purpose to entertain the Hightower appeal and to reverse this case on a procedural ground only to order the trial judge to enter judgment on counts I and II in favor of the Department. It is clear, therefore, that the appeal is moot as to counts I and II.

A more troublesome question is presented with regard to count III, in which only Hightower alleges that the action of the Department violated the Federal and Illinois constitutions. That claim is not present in the Clark complaint. While all three plaintiffs, Hightower, Toney and Clark, attack the regulation under the Illinois statute and the Social Security Act, only Hightower alleges a constitutional violation. Her claim, in substance, is that the regulation, as applied to her, punishes her for having more children. However, that same claim was made in her complaint for administrative review, which was adjudicated in her favor. Insofar as the record is concerned, we must infer that the Department continues to pay, and will pay, Hightower under the provisions of the grandfather clause. Assuming we were to reverse Judge Kiley’s ruling and remand the case for consideration of Hightower’s constitutional claim, the only relief available would be that which she is already receiving. Since we have no reason to believe that the problem will recur with her, we do not believe that count III of the Hightower complaint comes within the public interest exception and, therefore, is also moot. We are aware that the constitutional claim has not been clearly decided; but we are not convinced that such claims are so numerous that they need be decided in a class action. If that issue arises in the future, we see no reason why it cannot be decided in an administrative review action, the same procedure that was followed in Figures v. Swank (1970), 128 Ill. App. 2d 211, 263 N.E.2d 599, which ultimately led to a directive by the Director of Public Aid.

We wish to make our position clear that our holding in Clark should not be construed to bar any future payments to Hightower based on Judge Kiley’s ruling in the administrative review complaint. For reasons never explained to us, the Department saw fit not to appeal Judge Kiley’s ruling; and it would be manifestly unfair to permit the Department to avoid the effect of that failure to appeal and to require Hightower to relitigate the same issues. The Department could have done precisely what it did in Figures v. Swank.

In the memorandum filed by the Department in support of its motion to dismiss the Hightower appeal, it has referred to the second Toney administrative review complaint and argues that that complaint is also barred by the res judicata effect of the Clark decision. We are unclear as to what precisely the Department is asking of this court with respect to the second Toney administrative review complaint. Whatever the Department may be asking, we refrain from giving, since the second Toney complaint is not before us for review. We have taken judicial notice of that complaint only insofar as it may be material to the public interest exception to the mootness doctrine. We note parenthetically that the second Toney complaint refers to Judge Riley’s previous ruling in her favor as a ground for relief.

For these reasons, the Hightower appeal is dismissed.

Appeal No. 1 — 87—3399, Appeal dismissed.

Appeal No. 1 — 88—2949, Judgment affirmed.

QUINLAN and LaPORTA, JJ., concur.

       Justice Quinlan participated in the decision of this case prior to his resignation from the court.


source: Caselaw Access Project

author: PRESIDING JUSTICE FREEMAN

license: Public Domain

text:
    JOSEPH PEDOTT, Plaintiff-Appellee and Cross-Appellant, v. HARRY DORMAN et al., Defendants-Appellants (The First National Bank of Chicago, as Ex’r of the Last Will of Meyer Samuel Pedott, Deceased, Intervening Plaintiff-Appellee; Joseph Pedott et al., Defendants-Appellees).
    First District (3rd Division)
    No. 1—88—3330
    Opinion filed December 6, 1989.

      Morgan & Karzov, Ltd., of Chicago (Arnold J. Karzov and Douglas W. Graham, of counsel), for appellants.
    Jones & Jones, of Chicago (George W. Jones and Jeffrey A. Jones, of counsel), for appellee First National Bank of Chicago.
   PRESIDING JUSTICE FREEMAN

delivered the opinion of the court:

Plaintiff, Joseph Pedott, sued defendants, Harry and Selma Dorman, and Central National Bank in Chicago (CNB), for, inter alia, rescission of an assignment of his beneficial interest in a land trust to defendants Dorman. The First National Bank of Chicago (Intervenor), as executor of the last will of Meyer S. Pedott, plaintiff and defendant Selma Dorman’s father, intervened in the action to collect on a promissory note executed by CNB, as land trustee, and by the Dormans as guarantors. After a bench trial, the court entered judgment for plaintiff, inter alia, rescinding the assignment of beneficial interest. The court also entered judgment for intervenor on the promissory note. Harry Dorman (hereinafter defendant, Selma Dorman having deceased), appeals from the judgments for plaintiff and intervenor. Plaintiff cross-appeals the entry of judgment for intervenor against the land trust involved in this litigation.

Plaintiff’s complaint contained the following allegations material to this appeal. He assigned to the Dormans his beneficial interest in a three-story brick building located at 4842 North Ridgeway in Chicago (the premises) held in trust by CNB. He did so at the Dormans’ request and that of Meyer Pedott and in consideration of Meyer Pedott’s promise to bequeath his estate equally to his three children and Selma Dorman’s promise to share the estate equally amongst them. After Meyer Pedott executed a will to that effect, the Dormans conspired to induce him through the exercise of undue influence to disinherit plaintiff. Meyer Pedott executed codicils to his will which disinherited plaintiff when Meyer Pedott died in 1979. Pursuant to a will contest instituted by plaintiff, the codicils were not admitted to probate. The actions of the Dormans constituted a breach of their promises and resulted in a failure of consideration for the assignment of the beneficial interest in the premises.

At trial, the following facts relevant to plaintiff’s action against defendants were either stipulated to or revealed by the testimony, as found by the trial court. In March 1961, Meyer Pedott purchased the premises for $36,500 and held title thereto in his name. In January 1962, Meyer Pedott conveyed the premises in trust to CNB as trustee. Plaintiff was given the beneficial interest in and power of direction over the trust. Meyer Pedott died in 1979. Selma Dorman was afflicted with multiple sclerosis. One of the purposes, if not the key purpose, of Meyer Pedott’s purchase of the premises was to provide rent-free shelter for Selma and her family for as long as she lived. Selma and her family lived on the premises rent-free, collected rents and accounted for income and expenses to plaintiff from 1962 to 1977. On June 14, 1976, Meyer Pedott executed a will bequeathing his estate to his three children, equally. On June 16, 1976, plaintiff assigned his beneficial interest in the premises to the Dormans at the request of the Dormans and Meyer Pedott. Plaintiff also shared the power of direction with the Dormans. The assignment was made without consideration. Subsequently, Meyer Pedott executed a will substantially the same as the June 14, 1976, will but later added two codicils, dated May 13, 1977, and December 10, 1977, which effectively disinherited plaintiff to Selma’s benefit.

Intervener’s complaint contained the following allegations material to this appeal. Intervenor came into possession in 1982 of a promissory note executed by CNB, in 1962, as land trustee of the premises. The note provided for payment by CNB from the trust estate. CNB also executed a trust deed to Chicago Title and Trust Company (CT&T) as security for the note. CNB executed the note and trust deed pursuant to a letter of direction from plaintiff. The Dormans executed the note as guarantors. The note evidenced an intent to create a mortgage upon the premises. The note had not been paid.

With respect to plaintiff’s action for rescission, the trial court concluded that Meyer Pedott’s execution of the June 14, 1976, will, and plaintiff’s June 16, 1976, assignment to the Dormans of the beneficial interest in the premises had to be considered together. The court further concluded that Selma “impinged upon Meyer S. Pedott’s free will” and caused him to change his will to plaintiff’s detriment. It further found that Selma had “integrated the change of assignment in beneficial interest to totally and substantially change what Meyer S. Pedott had intended, a situation that totally benefitted her.”

Intervenor’s evidence at trial substantiated all of its factual allegations regarding the execution of the note. In addition to making factual findings in accordance therewith, the trial court expressed its opinion that one of the keys in the case was defendant’s credibility. The court expressed its disbelief of defendant’s inability to recall signing the note and of his contention that he paid $4,000 toward the purchase of the premises in 1961. The court noted the admissions of plaintiff, defendant and CNB that they made no payments on the note and then found intervenor’s action valid, subject to the statute of limitations. The court rejected defendant’s affirmative defenses of waiver and laches. The court concluded that, although the trust deed given to secure the note by a pledge of the premises as security had not been recorded, the note should stand as an equitable lien against the premises. Finally, the court found intervenor’s attorney fees to be an obligation of defendant and CNB as trustee. The court entered judgment accordingly.

Opinion

On appeal, defendant raises three grounds for reversal of the judgment for plaintiff. He first asserts that plaintiff failed to establish by the requisite standard of proof, viz., clear and convincing evidence, any recognized ground for rescission of the assignment of beneficial interest, which is absolute and unconditional on its face. Defendant asserts that plaintiff failed to prove the elements of a claim for fraud and deceit, i.e., misrepresentations of material facts with knowledge of their falsity and an intent that plaintiff rely thereon and justifiable reliance thereon to plaintiff’s injury.

We cannot agree that plaintiff’s claim for rescission was grounded upon a theory of fraud. The material allegation of plaintiff’s complaint against defendant was that the Dormans conspired to exert undue influence upon Meyer Pedott “to fabricate and induce upon” him distrust of plaintiff so as to cause him to disinherit plaintiff. It is clear that plaintiff’s theory of action was the exercise of undue influence by the Dormans over Meyer Pedott.

“[Ujndue influence, whatever its origin, is ‘any improper *** urgency of persuasion whereby the will of a person is overpowered and he is induced’ ” to do an act which he would not do or to forbear an act which he would do if left to act freely. (Nemeth v. Banhalmi (1984), 125 Ill. App. 3d 938, 966, 466 N.E.2d 977.) A prima facie case of undue influence is made out where: (1) a fiduciary relationship existed between a testator and a person receiving a substantial benefit under the will (compared to others who have an equal claim to a testator’s bounty); (2) the testator was in a dependent situation in which the substantial beneficiaries were in dominant roles; (3) the testator reposed trust and confidence in such beneficiaries; and (4) a will was prepared or procured and executed in circumstances wherein such beneficiaries were instrumental or participated. Nemeth v. Banhalmi (1984), 125 Ill. App. 3d 938, 960, 466 N.E.2d 977.

Given the foregoing definition and elements of undue influence, we find that plaintiff wholly failed to meet his burden of proof to obtain rescission of the assignment of beneficial interest based on the Dormans’ exercise of such influence over Meyer Pedott.

Putting aside the evidence of the circumstances surrounding plaintiff’s execution of the assignment of beneficial interest, plaintiff’s entire evidence on the issue of undue influence merely consisted of the following. Plaintiff had been given a power of attorney by Meyer Pedott in or about 1973 because Meyer Pedott was very sick at that time. The Dormans had Meyer Pedott “sign some papers” relieving plaintiff of that responsibility approximately six months to a year after he executed the assignment of beneficial interest to them. The Dormans sued plaintiff in an attempt to remove his power of direction over the CNB trust in 1978 but were unsuccessful. Plaintiff instituted a will contest proceeding in order to be reinstated to a one-third share of Meyer Pedott’s estate. According to plaintiff, the jury in that proceeding found that Meyer Pedott was under the undue influence of the Dormans.

This evidence was wholly insufficient to prove either directly or circumstantially, even by a preponderance of the evidence and even conceding that defendant did not contradict or rebut it, that either or both of the Dormans exerted an improper urgency of persuasion overpowering the will of Meyer Pedott and inducing him to disinherit plaintiff, which he would not otherwise have done. In other words, it wholly failed to show that a fiduciary relationship existed between Meyer Pedott and either of the Dormans, even conceding that they received a substantial benefit under the May and December 1977 codicils to the exclusion of plaintiff, who had an equal claim to Pedott’s bounty. In this regard, we will not assume that the Dormans had a fiduciary relationship with Meyer Pedott simply by virtue of their filial relationship to him. However, even were we to do so, the remaining elements of proof of undue influence were not met in this case. There was absolutely no evidence that Meyer Pedott was dependent upon the Dormans or that they dominated him. Nor was there any evidence that he reposed trust and confidence in the Dormans. Finally there was no proof that the Dormans were instrumental or participated in the preparation, procurement or execution of the codicils which disinherited plaintiff.

With regard to plaintiff’s testimony that the jury in the probate proceeding found that the Dormans had unduly influenced plaintiff, we note, significantly, that plaintiff does not claim to have asserted res judicata or collateral estoppel below and does not do so on appeal. Moreover, although the judgment orders in his favor therein were admitted into evidence, they are not part of the record on appeal. In addition, neither of the copies of those judgment orders, appended as exhibits to plaintiff’s complaint, recites such a finding by the jury. The copy of the order pertaining to the May 13, 1977, codicil merely recites that the alleged grounds of invalidity thereof were that Meyer Pedott executed it under an insane delusion “and/or” the undue influence of Selma Dorman. It further merely recites that the jury found neither the May 13, 1977, nor December 10, 1977, codicil to have been the valid last will and testament of Meyer Pedott.

Viewing plaintiff’s execution of the June 16, 1976, assignment of beneficial interest together with Meyer Pedott’s execution of the June 14, 1976, will, as the trial court did, is of no avail to plaintiff. Even conceding as proven facts that plaintiff executed the assignment in consideration of Meyer Pedott’s promise to bequeath his estate to his children equally, that the assignment was motivated by plaintiff’s and Meyer Pedott’s desire and concern that Selma, afflicted with multiple sclerosis, and her family have a home for as long as she lived, that the Dormans repeatedly requested that plaintiff make the assignment prior to June 16, 1976, that plaintiff’s assignment and Meyer Pedott’s bequest of his estate to his children equally was agreed upon by plaintiff, Pedott and the Dormans, these facts provide no basis whatsoever for an evidentiary finding of undue influence upon Meyer Pedott by either of the Dormans.

In sum, we believe that plaintiff’s evidence was wholly conclusory, speculative and conjectural. As plaintiff himself so aptly stated in his testimony, he had no “hard evidence[ ] about the will” of Meyer Pedott. Such evidence is as insufficient to carry a burden of proof by a preponderance of the evidence at a trial on the merits as it is to state a cause of action at the pleading stage. Our adversarial system of justice requires that a plaintiff present more evidence of alleged wrongdoing by a defendant than merely saying, “He did it,” especially where, as here, the plaintiff did not see the defendant do it. While the Dormans and specifically Selma may, indeed, have exercised undue influence over Meyer Pedott, plaintiff’s evidence would allow no reasonable fact finder to reach that conclusion given the legal definition of the tort. The judgment for plaintiff must be reversed.

In view of our conclusion, we need not address the remaining issues raised by defendant against plaintiff.

In appealing the judgment for intervenor, defendant first asserts that the evidence failed to establish any consideration for the promissory note sued upon by intervenor, as required under section 3 — 408 of the Uniform Commercial Code (Ill. Rev. Stat. 1987, ch. 26, par. 3— 408). We disagree.

The recital in a note attached to a complaint that it was given “For Value Received” is a sufficient allegation of consideration. (Stolzenbach v. Pagoria (1979), 71 Ill. App. 3d 863, 390 N.E.2d 376.) Moreover, in an action on a validly executed negotiable instrument, consideration is presumed (Stolzenbach, 71 Ill. App. 3d 863, 390 N.E.2d 376) and no further proof thereof is required other than the note itself (M. Loeb Corp. v. Brychek (1981), 98 Ill. App. 3d 1122, 424 N.E.2d 1193). While the presumption of consideration is rebuttable, the evidence offered in rebuttal must be of a very clear and cogent nature. Davis v. Buchholz (1981), 101 Ill. App. 3d 388, 428 N.E.2d 198; Gustafson v. Lindquist (1976), 40 Ill. App. 3d 152, 351 N.E.2d 280.

Applying the foregoing rules here, we believe that consideration for the note sued upon by intervenor was adequately established at trial. The note attached to intervenor’s complaint recited that it was given “For Value Received.” Moreover, it was validly executed. CNB admitted its execution of the promissory note as trustee pursuant to plaintiff’s direction. Defendant did deny having executed the note in 1962. However, the trial court disbelieved him. Instead, it believed the testimony of Etta Whitney, the wife and secretary of Bernard Whitney, who acted as Meyer Pedott’s attorney with respect to matters respecting the premises in 1962, that defendant signed the note in her presence and had Selma sign it later. The credibility of the witnesses was for the trial court. A rebuttable presumption thus arose that there was consideration given for the note. And, defendant failed to overcome the presumption by clear and cogent evidence.

The only evidence offered at trial tending to rebut the presumption of consideration was that of plaintiff, defendant and CNB that they had not received $15,000 pursuant to the note. The mere testimony of a payee under a promissory note that he gave the promisee the amount of money recited therein is insufficient to render a finding of a lack of consideration against the manifest weight of the evidence. (Guzell v. Kasztelanka Cafe & Restaurant, Inc. (1980), 87 Ill. App. 3d 381, 408 N.E.2d 1124.) Similarly, neither plaintiff’s, defendant’s nor CNB’s testimony was sufficient to overcome the presumption of consideration which arose in this case, whether or not the trial court ret lied thereon in entering judgment for intervenor.

Finally, as neither defendant, plaintiff, nor CNB rebutted the presumption of consideration, judgment was properly entered against defendant as CNB’s guarantor. Where a guaranty is executed contemporaneously with an original note or obligation, the consideration for the note or obligation furnishes sufficient consideration for the guaranty. (Continental National Bank v. Schiller (1980), 89 Ill. App. 3d 216, 411 N.E.2d 593; First National Bank v. Chapman (1977), 51 Ill. App. 3d 738, 366 N.E.2d 937.) As such, a guarantor is liable on a note even though he does not receive the consideration flowing from the payee. See Harris Bank Argo v. Midpack Corp. (1986), 151 Ill. App. 3d 293, 502 N.E.2d 1127.

Defendant next contends that intervenor is barred from suing on the note under either the doctrine of laches or waiver. We disagree. We find that neither laches nor waiver is applicable to commercial paper such as the promissory note sued upon where, as is the case therein, all parties thereto waived presentment for payment, notice of dishonor, protest and notice of protest, as provided for under section 3— 511(2)(a) of the Uniform Commercial Code (Ill. Rev. Stat. 1987, ch. 26, par. 3—511).

In Pfaelzer v. Kau (1904), 207 Ill. 116, 69 N.E. 914, overruled in part on other grounds in Tucker v. Mueller (1919), 287 Ill. 551, 122 N.E. 847, the guarantor of a promissory note contended that he was entitled to assert the defense of laches to a suit thereon. The guarantor asserted that he had been prejudiced by the payee’s neglect to notify him of the default of the maker of the note and to bring suit thereon until after the maker had declared insolvency. After reviewing the law, the supreme court denied the right to assert the doctrine of laches by saying: “[H]e who guarantees the payment of a promissory note at its maturity *** is not entitled to notice of non-payment, and *** if the payee does not give notice of non-payment until the maker *** becomes absolutely insolvent, the guarantor is not thereby discharged, even though he *** is unable to enforce payment thereof against the principal.” (Pfaelzer, 207 Ill. at 125.) Tucker merely overruled that part of Pfaelzer holding that one who endorsed the back of a note in blank was prima facie a guarantor. It did not overrule the holding in Pfaelzer that a guarantor cannot assert the defense of laches. As there was no dispute here as to the capacity in which the Dormans endorsed the note, Tucker does not preclude defendant’s liability thereon.

Lastly, defendant asserts that there is no basis in the note or any statute for intervenor’s recovery against defendant of attorney fees or expenses in collecting upon the note. On this issue, we agree with defendant.

The promissory note executed by CNB, as trustee, and by the Dormans as guarantors contained no provision with respect to liability for attorney fees or expenses incurred in suing for collection of the note. Nor did it contain any language incorporating the terms of the trust deed given to secure the note. The trust deed provided, inter alia:

“3. At the option .of the holders of the note *** all unpaid indebtedness secured by this trust deed shall[ ] *** become due and payable (a) immediately in the case of default in making payment of any instalment of principal or interest on the note * * *
4. *** In any suit to foreclose the lien hereof, there shall be allowed and included as additional indebtedness in the decree for sale all expenditures and expenses which may be incurred by or on behalf of Trustee [Chicago Title & Trust Co.] or holders of the note for attorneys’ fees ***. All [such] expenditures and expenses *** shall become so much additional indebtedness secured hereby *** when paid or incurred by Trustee or holders of the note in connection with *** any proceeding *** to which either of them shall be a party *** by reason of this trust deed or any indebtedness hereby secured.

The trust deed thus provided for the collection of attorney fees incurred in suing upon the note. However, that fact is not dispositive of defendant’s liability therefor.

Defendant and intervenor both cite Washingtonian Home v. Van Meter (1938), 297 Ill. App. 591, 18 N.E.2d 81, as negating and supporting intervenor’s right to attorney fees here. However, we do not find Van Meter supportive of either defendant’s or intervenor’s arguments on this issue. Van Meter is distinguishable from this case in that the party sued therein upon a promissory note, secured by a mortgage, signed the note as the maker rather than as a guarantor or surety and in that he was also properly sued on the mortgage, having signed that instrument as well. The other cases cited by intervenor are distinguishable on this basis (see, e.g., Huber v. Brown (1909), 243 Ill. 274, 90 N.E. 748) or because they merely involved suit on a promissory note (see, e.g., Williams v. Federal Deposit Insurance Corp. (1987), 155 Ill. App. 3d 633, 508 N.E.2d 337). Neither Van Meter nor those cases address the precise issue here, i.e., the liability of a guarantor of a note secured by a mortgage for obligations imposed only in the mortgage where he has not signed that instrument. We believe the following case law is dispositive of this issue.

A promissory note and mortgage given to secure it are separate contracts, and a provision in the mortgage not found in the note is not a part thereof and does not affect the personal liability of the maker of the note. (Affronti v. Bodine (1987), 155 Ill. App. 3d 755, 508 N.E.2d 500; Mortgage Syndicate, Inc. v. Do & Go Equipment, Inc. (1972), 7 Ill. App. 3d 106, 286 N.E.2d 520.) Similarly, a provision in the mortgage not found in the note cannot affect defendant’s liability as guarantor. An action against a guarantor of a note is separate from the remedy of foreclosure and sale (Emerson v. La Salle National Bank (1976), 40 Ill. App. 3d 794, 352 N.E.2d 45), and the guarantor’s liability is determinable from the instrument of guaranty only (Du Quoin State Bank v. Daulby (1983), 115 Ill. App. 3d 183, 450 N.E.2d 347).

From the foregoing rules, we conclude that the fact the trust deed allowed for the recovery of attorney fees incurred in suing upon the note did not allow the recovery thereof against defendant. Although intervenor could recover such fees, it could do so, by the express terms of the trust deed, only in an action to foreclose the lien granted by the deed. That action would involve only CNB, inasmuch as CNB, as trustee, alone executed the trust deed. It would not involve defendant, he not being a party to the deed but merely a guarantor of the note secured thereby. As such, there was no authority for the award of attorney fees against defendant. The award must be reversed.

In his cross-appeal, plaintiff contends that it is inequitable to charge him on the promissory note by imposing a lien upon the CNB trust, of which he is the sole beneficiary. However, our reversal of the judgment for plaintiff rescinding his assignment of the beneficial interest in the premises has rendered this issue moot. As a result of that reversal, plaintiff has no interest in the premises which is adversely affected by imposing an equitable lien thereon based on the promissory note.

For all of the reasons stated herein, the judgment for Joseph Pedott is reversed and the judgment for the First National Bank of Chicago is affirmed except insofar as it awards attorney fees against Harry Dorman.

Affirmed in part; reversed in part.

RIZZI and WHITE, JJ., concur.


author: JUSTICE JOHNSON

text:
    MARY GIVENS, Plaintiff-Appellee, v. VIRGINIA GIVENS, Defendant-Appellant.
    First District (4th Division)
    No. 1—88—1572
    Opinion filed December 7, 1989.

      Edmund N. Sajewski, of Chicago, for appellant.
    John T. Kelly, of John T. Kelly & Associates, of Orland Park, for appellee.
   JUSTICE JOHNSON

delivered the opinion of the court:

Defendant, Virginia Givens, appeals from an order of the circuit court of Cook County which confirmed a settlement contract entered between plaintiff, Mary Givens, and defendant, Virginia Givens. Judgment was entered against defendant in the amount of $5,950. The following issues are presented for review: (1) whether the trial court had subject matter jurisdiction; (2) whether plaintiff states a cause of action against defendant; (3) whether plaintiff states a claim upon which relief may be granted against defendant; (4) whether the trial court erred in not granting defendant’s motion to dismiss; (5) whether defendant was denied her constitutional right to be present at trial; and (6) whether the judgment against defendant was against the manifest weight of the evidence.

On August 30, 1976, Robert Givens, adoptive father of plaintiff and spouse of defendant, was killed in an accident which arose in and out of the course of his employment. On December 23, 1977, the Industrial Commission of Illinois (hereinafter Commission), approved a settlement between the decedent’s employer and designated beneficiaries of the decedent. The designated beneficiaries were defendant, plaintiff, David and Gerald Givens (minor children of decedent), and Adonis and Rex Givens (adult children of decedent).

Pursuant to the contract, a total lump sum of $65,000 was set aside as a complete and final settlement in release of all claims and liability under the Workers’ Compensation Act (Ill. Rev. Stat. 1985, ch. 48, par. 138.1 et seq. (hereinafter the Act), for the alleged accidental death of decedent. A schedule was attached to the contract which allocated a portion of the $65,000 to each of the designated beneficiaries. Although the beneficiaries were to be given proportional shares of the award, the amounts allotted to the minor children, including plaintiff, were to remain with defendant until such minor children reached 18 years of age. Decedent’s adult children received their allotted share of the award when it was first distributed.

According to the schedule attached to the settlement contract, plaintiff, who was approximately HYz years of age at the time the agreement was entered, was to receive $7,145.66. Plaintiff resided with defendant, her adoptive mother, from the time of her adoptive father’s death on August 30, 1976, until her eighteenth birthday on June 9,1978.

Plaintiff moved from defendant’s home on her eighteenth birthday. At that time, defendant wrote plaintiff a letter in which she stated that she could not give plaintiff the money she had set aside because defendant felt that it would “destroy all the good in [plaintiff] now and reduce [her] chances of knowing a Godly future.”

Plaintiff filed a complaint against defendant on August 6, 1986, alleging that defendant had not given plaintiff her portion of the award. In her complaint, plaintiff requested $7,145.66, plus accrued interest. After a bench trial, plaintiff was awarded $5,945.56, out of the $7,145.66, plus costs. Defendant was given credit for six months of support to plaintiff. It is from this order that defendant appeals.

Defendant first contends that the trial court did not have subject matter jurisdiction. Defendant argues that the complaint should have been filed with the Commission, which has exclusive jurisdiction to modify this award. As support for this contention, defendant cites to section 7(e) of the Act, which provides in pertinent part, that “[an] order or award may be modified from time to time by the Commission in its discretion with respect to the person to whom shall be paid the amount of the order or award remaining unpaid at time of the modification.” Ill. Rev. Stat. 1985, ch. 48, par. 138.7(e).

Plaintiff in the instant case, however, does not seek to amend or modify the settlement contract that was approved by the Commission. Plaintiff seeks to enforce the settlement. We, therefore, find that this section of the Act, insofar as it pertains to modification, is inapplicable as plaintiff does not seek to modify the existing contract.

Defendant also cites to Ahlers v. Sears, Roebuck Co. (1978), 73 Ill. 2d 259, as support for her proposition that the circuit court had no subject matter jurisdiction to hear this matter. We find Ahlers inapposite to defendant’s proposition. In Ahlers, the Illinois Supreme Court held that the approval of a settlement agreement by the Commission constitutes a decision and is the equivalent of an award by the Commission. (Ahlers, 73 Ill. 2d at 265.) However, the court went on to hold that an action on the approved settlement agreement may be properly commenced in the circuit court. (Ahlers, 73 Ill. 2d at 265.) Although Ahlers concerned claims made by the plaintiff under section 19(g) of the Act (Ill. Rev. Stat. 1975, ch. 48, par. 138.19(g)), we find those same principles applicable to plaintiff’s claims in the instant case. Here, plaintiff is not seeking modification of the award; she is seeking enforcement of the award. The circuit court would not be an inappropriate forum for such proceedings.

Next, defendant maintains that plaintiff failed to state a cause of action against defendant since there was no order issued by the Commission, nor is there any case law, which mandates that the partner receiving an award must give a portion of such award to a minor dependent upon reaching the age of majority. Defendant rationalizes that the payment schedule is not an order but was merely a basis upon which to calculate the award. We disagree.

Section 7(e) of the Act states as follows:

“The compensation to be paid for accidental injury which results in death, as provided in this Section, shall be paid to the persons who form the basis for determining the amount of compensation to be paid by the employer, the respective shares to be in the proportion of their respective dependency at the time of the accident on the earnings of the deceased. The Commission or an Arbitrator thereof may, in its or his discretion, order or award the payment to the parent or grandparent of a child for the latter’s support the amount of compensation, which but for such order or award would have been paid to such child as its share of the compensation payable ***.” Ill. Rev. Stat. 1985, ch. 48, par. 138.7(e).

Although the amount paid to the dependents forms a basis for the total award and the Commission may in its discretion and under certain circumstances decline to make a pro rata distribution of the proceeds (see Mid-American Lines, Inc. v. Industrial Comm’n (1980), 82 Ill. 2d 47), we find nothing in the record that would be indicative of the Commission’s exercising its discretion in not approving the apportioned award. The award with the attached schedule apportioning the proceeds to the various dependents was approved by the Commission in its entirety.

Further, defendant attempts to make an artificial distinction between an award and an order issued by the Commission. The approval of a settlement contract constitutes a decision of the Commission and is, therefore, tantamount to an award. (Ahlers v. Sears, Roebuck Co. (1978), 73 Ill. 2d 259, 265.) The approval of the settlement contract including the attached schedule is in legal effect a decision or order issued by the Commission. We find that plaintiff has adequately stated a cause of action against defendant.

Defendant also maintains that plaintiff failed to state a claim upon which relief may be granted against defendant since defendant did not act as a trustee or fiduciary for plaintiff with respect to the award. Defendant argues that she had no duty to disburse plaintiff’s portion of the money when she reached majority. We disagree.

By defendant’s own admission, she stated in a letter to plaintiff on her eighteenth birthday that she could not give plaintiff her allotted portion of the award as she had with the other children because defendant found plaintiff irresponsible. Defendant was entrusted with a portion of the award until plaintiff reached majority. Further, the settlement contract does not, by its own terms, provide defendant with the discretion to withhold a dependent allotted monies after such dependent reaches the age of majority. A specified amount of money was allotted to plaintiff. The award was based on dependency and was not given solely to provide for defendant’s care.

We find that, under the circumstances, defendant did have a duty to give plaintiff her proportionate share of the award when plaintiff reached the age of majority. Accordingly, we hold that plaintiff did state a claim upon which relief could be granted.

Defendant also contends that the trial court erred in refusing to grant her motion to dismiss, based on the defense that the statute of limitations barred plaintiff’s complaint that was filed eight years after she had reached the age of majority. Specifically, defendant cites to section 13 — 205 of the Code of Civil Procedure, which provides that “actions *** on awards of arbitration *** shall be commenced within 5 years next after the cause of action accrued.” Ill. Rev. Stat. 1985, ch. 110, par. 13—205.

We find this section inapplicable since plaintiff is not seeking a review of an award; instead, she is seeking enforcement of the settlement contract. Section 13 — 206 of the Code of Civil Procedure would govern the limitation period in this action. The section provides that “actions on *** written contracts, or other evidences of indebtedness in writing, shall be commenced within 10 years next after the cause of action accrued.” (Ill. Rev. Stat. 1985, ch. 110, par. 13—206.) Plaintiff, therefore, was within the 10-year limitation period.

Defendant next argues that the trial court improperly denied her motion to hold the trial in her home. Defendant did not feel that she would be able to attend trial as she is an invalid. The trial court denied the motion but made allowances for her condition by scheduling an evidence deposition to be taken at her home. Defendant, however, refused to be deposed, in violation of the court-ordered deposition. She states that she informed some undisclosed court personnel that she could not attend trial because of her physical condition and asked if she could come to court on a stretcher. She was told that it would not be permissible. Defendant now, for the first time, raises this issue on appeal.

Although defendant conceivably waived this issue for appeal, since it was not raised at the trial court level, we do not find that she was denied the right to a fair trial. The right to be present at trial may be waived by defendant by voluntarily or involuntarily absenting herself from trial. (People v. Allen (1967), 37 Ill. 2d 167, 171.) There is no evidence in the record that defendant was barred from trial. Defendant’s argument that she was barred from trial since she could not come to court on a stretcher is unsubstantiated. This was not an edict from the court. We, therefore, find that the court did not err in denying defendant’s motion to hold the trial at her home.

Finally, defendant contends that the trial court’s decision was against the manifest weight of the evidence. In nonjury cases, witness credibility is to be determined by the trial court. (Shanahan v. Schindler (1978), 63 Ill. App. 3d 82, 92.) A reviewing court will not substitute its judgment as to credibility unless against the manifest weight of the evidence. (Brown v. Zimmerman (1959), 18 Ill. 2d 94, 102.) A review of the record in the instant case reveals that the judgment was duly supported by the evidence and is free of error.

For the foregoing reasons, the judgment of the circuit court is affirmed.

Affirmed.

JIGANTI, P.J., and LINN, J., concur.


author: JUSTICE LINN PRESIDING JUSTICE JIGANTI,

text:
    SONJA F. PERKINS et al., Minors, by Frances Roberts, their Mother and Next Friend, Plaintiffs-Appellees, v. STATE SECURITY INSURANCE COMPANY, Defendant-Appellant.
    First District (4th Division)
    No. 1—88—2876
    Opinion filed December 7, 1989.
    JIGANTI, P.J., specially concurring.
    Brody, Gore, Fineberg & Wikoff, Ltd., of Chicago (Marcus J. Nunes, of counsel), for appellant.
    Grubman & Nathan, P.C., of Chicago (Donald S. Nathan and David D. Wilier, of counsel), for appellees.
   JUSTICE LINN

delivered the opinion of the court:

The minor plaintiffs, Sonja F. Perkins and Denisha Perkins, by their mother, Frances Roberts, brought an action against the mother’s insurance company, State Security Insurance Company, following an automobile collision in which they were injured. The mother was driving, with the children as passengers, when their car struck a parked car. Plaintiffs assert that the parent-child immunity doctrine bars them from directly suing their mother. Therefore, they contend that she is uninsured as to them and they are entitled to recover under the uninsured motorist provision of her policy.

Defendant, State Security Insurance Company, counters that in Illinois, intrafamily immunities are procedural bars, rather than substantive ones which destroy the cause of action itself. Procedural bars are personal and may be waived. Nothing in the policy prevents the children from suing her. Therefore, the insurance company contends that the children may sue their mother in negligence. Because she is thus an insured motorist, the pending action should be dismissed.

The trial court heard arguments and entered summary judgment for plaintiffs. Defendant filed its notice of appeal shortly thereafter.

Opinion

The order from which the parties appeal, dated August 22, 1988, enters summary judgment in favor of plaintiffs and against defendant. Although the lawsuit was not filed as a declaratory judgment action, the parties have stipulated that the only issue that was before the trial court was the existence of coverage under the insurance policy. The order, in effect (although not expressly), compels the parties to arbitrate the claim because the order implicitly holds that coverage is available under the uninsured motorists’ provision of the policy.

The narrow issue before us is whether the uninsured motorist provision of the mother’s policy is available to satisfy the claims her children have against her for their injuries. A corollary issue centers on the applicability of the parent-child immunity doctrine and whether that bar transforms the mother into an uninsured as to the children.

Initially we note that the children appear to be covered directly as “persons insured” for their reasonable medical expenses under “Part II — Expenses for Medical Services.” Coverage for reasonable and necessary medical expenses is provided “to or for the named insured and each relative who sustains bodily injury ***, caused by accident, while occupying *** an automobile.” We assume that the balance of plaintiffs’ claim under the uninsured motorists’ coverage is for pain and suffering and whatever other injury is compensable under law.

Plaintiffs base their claim on the uninsured motorist provision rather than under the general liability provision of the insurance policy. They reason that the parent-child immunity doctrine bars them from suing the mother directly and therefore prevents them from stating a cause of action in negligence. Hence, the mother is actually “uninsured” as to them and they are entitled to assert their claim against her insurance company under the uninsured motorist coverage.

State Security, conversely, maintains that the uninsured motorist provision is unavailable because nothing in the policy precludes the children, as family members, from suing their mother in order to obtain the insurance proceeds under the general liability coverage. Accordingly, the mother is insured and the uninsured motorist section does not apply.

Part I, the general liability provision of the insurance policy, provides in relevant part that the insurance company shall “pay on the behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of *** bodily injury *** sustained by any person *** arising out of the ownership, maintenance, or use of the owned automobile *** and the company shall defend any suit alleging such bodily injury.”

The uninsured motorist provision is part IV of the policy. “Part IV — Family Protection Coverage” provides that the company shall pay all legally recoverable sums to the “named insured and any relative” for “bodily injury caused by accident and arising out of the ownership, maintenance or use of [an] uninsured automobile.”

We believe that the insurance policy does provide coverage for the injuries that the children suffered when their mother’s automobile was involved in the collision. However, we agree with State Security Insurance Company that the theory plaintiffs advance is technically incorrect.

In General Accident Fire & Life Assurance Corp. v. Klatt (1984), 121 Ill. App. 3d 862, 460 N.E.2d 339, the court rejected a husband’s claim under the uninsured motorist coverage of the policy on his automobile. His wife was driving at the time he was injured. The court noted that the interspousal immunity did not destroy a cause of action between the spouses but only provided a defense. Accordingly, the court held that the wife was an insured and that the uninsured motorist coverage did not apply as a matter of law.

Other cases which have considered the applicability of uninsured motorist provisions in the context of intrafamily claims interpret such coverage as extending to family members of the insured-driver when the insurance policy contains “household exclusions.” Thus, in Kerouac v. Kerouac (1981), 99 Ill. App. 3d 254, 425 N.E.2d 543, the driver’s minor brother was allowed to maintain a claim against the father’s insurance company pursuant to the uninsured motorist provision of the insurance policy. The court noted that the insured and his family members were excluded from the general liability coverage. After reviewing the legislative intent behind the passage of the uninsured motorist statute, the court stated, “As to this particular plaintiff, the minor [plaintiff], because of the exclusion with respect to liability for injury to family members, the automobile in which he was riding was not an insured automobile and the driver was not an insured motorist.” 99 Ill. App. 3d at 259-60, 425 N.E.2d at 547, citing as controlling, Barnes v. Powell (1971), 49 Ill. 2d 449, 275 N.E.2d 377.

In Farmers Insurance Group v. Nudi (1982), 108 Ill. App. 3d 151, 438 N.E.2d 1260, the court held that the injured wife of the driver of an insured automobile was entitled to make a claim under the uninsured motorist provision of their policy because of the household exclusion in the policy. The court did not analyze the exclusion except to note that it caused the husband to become uninsured as to the wife.

In the pending case, the policy of insurance contains no such exclusion for household members under the general liability coverage. Accordingly, logic and general principles of construction lead us to conclude that the mother is insured as to the children and that their claim against her may be maintained as a suit in negligence.

This conclusion does not end the analysis, however, because plaintiffs contend that they are absolutely barred from suing their mother because of the parent-child tort immunity. Their belief that the immunity is substantive and thus prevents a cause of action from arising is the reason they brought their claim under the uninsured motorist provision in the first place.

We disagree with plaintiffs’ view of the law. In Farmers Insurance Group v. Nudi (1982), 108 Ill. App. 3d 151, 153, 438 N.E.2d 1260, 1261, the court held that the interspousal tort immunity was procedural in nature, a personal defense that “does not inure to the benefit of third parties.” Nudi cited Allstate Insurance Co. v. Elkins (1979), 77 Ill. 2d 384, 396 N.E.2d 528, which held that the immunity is a defense that can be waived by a defendant spouse, not a substantive bar that would prevent the cause of action from accruing in the first place. Allstate also held that the third-party insurance company could not assert the immunity defense on behalf of its insured.

We believe that the parent-child immunity is sufficiently analogous to the interspousal immunity as to justify similar treatment. Accordingly, we hold that the minor plaintiffs are not substantively barred from maintaining an action against their mother. We further note that since the immunity is a defense personal to her, she may waive it, and State Security may not freely assert it on her behalf as a means of defeating the claim. See Maryland Casualty Co. v. Peppers (1976), 64 Ill. 2d 187, 198-99, 355 N.E.2d 24, 31 (where a conflict of interest exists between insurer and insured, insurer has duty to decline to defend its insured, in favor of independent counsel).

Because we have held that the mother is not uninsured as to her children under this policy, we must reverse the trial court’s grant of summary judgment. Nothing in this opinion or disposition should be read as defeating the rights of the plaintiffs to pursue relief under the appropriate legal theories; accordingly, the matter will be remanded to the trial court to give the parties a fair opportunity to amend pleadings or take whatever additional steps that may be necessary.

For the foregoing reasons, we reverse and remand.

Reversed and remanded.

JOHNSON, J., concurs.

PRESIDING JUSTICE JIGANTI,

specially concurring:

The complaint filed by the plaintiffs seeks an order to compel arbitration. The plaintiffs’ motion for summary judgment seeks a judgment compelling arbitration. The order entered by the trial court, as interpreted by the majority, compels the parties to arbitrate. The majority finds, and I agree, that under existing law, as explained by the majority, the mother is not an uninsured for uninsured motorist purposes. The proper order was to reverse the summary judgment in favor of the defendant. The opinion should end there.

However, the majority has suggested to the plaintiffs here that they file an action against a person not a party-defendant to this lawsuit. The majority then ruled that when that lawsuit is filed there will be coverage. Further, the court has ruled that the insurer may not raise a defense in behalf of their insured based on intrafamily immunity. I find this is a most imaginative effort at judicial economy. I respectfully decline to concur in that portion of the opinion.