author: JUSTICE DiVITO

text:
    DANNY VAUGHN, Plaintiff-Appellant, v. NORTHWESTERN MEMORIAL HOSPITAL et al., Defendants-Appellees.
    First District (2nd Division)
    No. 1 — 88—2252
    Opinion filed February 19, 1991.

      Michael W. Rathsack, of Chicago (Louis S. Goldstein and Cindy G. Flux-gold, of counsel), for appellant.
    Querrey & Harrow, Ltd., of Chicago (Michael Resis, of counsel), for appellee Northwestern Memorial Hospital.
    Kelley, Drye & Warren, of Chicago, and Northwestern University, of Evanston (Eric F. Quandt, Tammi C. Bornstein, Carolyn Quinn, and James M. Perry, of counsel), for other appellees.
   JUSTICE DiVITO

delivered the opinion of the court:

Plaintiff Danny Vaughn (plaintiff) brought a medical malpractice action against defendants Northwestern Memorial Hospital (Hospital), Northwestern Medical Faculty Foundation, Inc. (Foundation), Northwestern University Medical School (School), and Dr. David Cugell, M.D. (Cugell) (sometimes jointly, defendants). The circuit court denied plaintiff’s motion to dismiss the case voluntarily as to the Foundation and the Hospital, and granted all four defendants’ motions to dismiss with prejudice for failure to comply with discovery. Plaintiff appeals, presenting as issues: (1) whether the circuit court was required to grant plaintiff’s motion to dismiss his complaint voluntarily as to the Hospital and the Foundation before considering their previously filed motions to dismiss plaintiff’s case against them; and (2) whether the circuit court abused its discretion in dismissing plaintiff’s complaint with prejudice as to all four defendants for failure to comply with discovery.

In June of 1984, plaintiff filed an eight-count complaint against defendants to recover for personal injuries aUegedly sustained while receiving medical treatment from them. Discovery between the parties commenced, and on April 8, 1985, the Hospital served plaintiff with a notice for his deposition for October 2, 1985. On June 3, 1985, the three other defendants also served plaintiff with a notice to depose him on September 10,1985. Plaintiff failed to appear on both dates.

An initial pretrial conference was held on June 18, 1986. At that time the circuit court ordered the depositions of all parties to be completed by November 1, 1986. Plaintiff did not comply with this order. At the next pretrial, on February 25, 1987, the court ordered all discovery to be completed by December 11, 1987, and set a final pretrial conference for that date.

On November 19, 1987, the School, the Foundation, and Cugell filed a motion to dismiss plaintiff’s complaint for failure to comply with discovery. As of that date, plaintiff’s deposition had been continued 10 times at his request. In addition, he had not answered interrogatories pursuant to Rule 220 (107 Ill. 2d R. 220) which had been filed eight months earlier. Defendants further alleged that they had repeatedly attempted to obtain plaintiff’s compliance with discovery, but their efforts had been unsuccessful. Plaintiff filed no response to the motion. The motion was entered and the case was continued to December 11,1987.

On December 11, the case was continued to June 1, 1988, and the court ordered all oral discovery to be completed by that date. When plaintiff still did not appear for his deposition, Cugell and the School again presented their motion to dismiss on June 21, 1988. At that hearing, defense counsel alleged that plaintiff’s deposition had been continued 17 times and argued that this failure to comply warranted dismissal. Plaintiff’s counsel responded that plaintiff was in poor health and that it was difficult for him to appear for a lengthy deposition. The court granted the motion of Cugell and the School to dismiss with prejudice and found that, pursuant to Supreme Court Rule 304(a), (107 Ill. 2d R. 304), there was no just reason for delaying enforcement or appeal.

On June 24, 1988, both the Foundation and the Hospital filed motions to dismiss plaintiff’s complaint with prejudice and personally served plaintiff with their motions. A hearing on the motions was held on June 28, 1988, at which time, without prior notice to defendants, plaintiff presented his motion to voluntarily dismiss the case as to the two remaining defendants.

Defense counsel argued that they did not receive proper notice of plaintiff’s motion. Plaintiff’s counsel maintained that it was impossible for him to comply with local notice rules because he had not received defendants’ motions in time to comply. The court denied plaintiff’s motion and dismissed the case with prejudice as to the Hospital and the Foundation for plaintiff’s failure to comply with discovery. This appeal followed.

I

Plaintiff initially contends that he had a statutory right to voluntary dismissal regardless of the pendency of defendants’ motions to dismiss. He argues that the court was required to grant his motion to dismiss the case voluntarily before considering defendants’ motions.

Section 2 — 1009 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, chi 110, par. 2 — 1009(a)) governs voluntary dismissal. It states:

“(a) The plaintiff may, at any time before trial or hearing begins, upon notice to each party who has appeared or each such party’s attorney, and upon payment of costs, dismiss his or her action or any part thereof as to any defendant, without prejudice, by order filed in the cause.” (Emphasis added.)

The statute thus provides the three requirements which must be satisfied in order for the plaintiff to qualify for and receive voluntary dismissal. Those requirements are (1) no trial or hearing shall have begun; (2) costs must be paid; and (3) notice must be given. The Hospital and the Foundation maintain that plaintiff has not fulfUled the third requirement and is therefore precluded from voluntarily dismissing his case. Their position is well taken.

Circuit Court Rule 2.1 (Cook County Cir. Ct. Rules 2.1 (a), (c)(1)) governs the notice requirement. It states, in pertinent part:

“(a) Notice required — Except in actions appearing on the daily trial call or during the course of trial, written notice of the hearing of all motions shall he given to all parties who have appeared ***.
(c) Manner and time of service of notice.
(1) Notice shall be given in the manner and to the persons described in Supreme Court Rule 11. If notice of hearing is given by personal service the notice shall be delivered before 4:00 p.m. of the second (2nd) court day preceding the hearing of the motion. If notice is given by mail, the notice shall be deposited in a United States Post Office or Post Office Box on or before the fifth (5th) court day preceding the hearing of the motion.” (Emphasis added.) (Cook County Cir. Ct. Rules 2.1 (a), (c)(1).)

In this case, plaintiff gave no notice of his motion to voluntarily dismiss. Both the Foundation and the Hospital personally served plaintiff with their motions to dismiss on Friday, June 24, 1988. This complied with the two-day notice period which the rule requires for personal service. At the hearing on June 28,1988, following defendants’ presentations of their motions, plaintiff moved to voluntarily dismiss his complaint as to those two defendants. Plaintiff argued at the hearing that because of the timing of defendants’ service, he was unable to comply with the notice requirements. Yet, plaintiff did not attempt to contact either the court or opposing counsel between Friday, June 24 and Tuesday, June 28, 1988. At oral arguments, plaintiff asserted that the notice requirement of section 2 — 1009 meant only that nothing could be done ex parte. This interpretation of the statute’s notice requirement must be rejected. The specific notice requirement is clearly defined by the local rules.

Although plaintiffs generally have an absolute right to voluntary dismissal, they must comply with the requirements of section 2 — 1009. (Bailey v. State Farm Fire & Casualty Co. (1985), 137 Ill. App. 3d 155, 484 N.E.2d 522.) In Bailey, upon which plaintiff relies, the court granted plaintiff’s motion to voluntarily dismiss and denied defendant’s motion to dismiss with prejudice. The plaintiff in that case, however, had met all three requirements of section 2 — 1009, including the notice requirement.

Plaintiff’s reliance on Davis v. International Harvester Co. (1985), 139 Ill. App. 3d 264, 487 N.E.2d 385, is also misplaced for the same reason. In Davis, no trial or hearing had begun, costs were paid, and notice was given. The Davis court reiterated the necessity of fulfilling section 2 — 1009’s three requirements before plaintiff’s right to voluntarily dismiss becomes absolute. It stated that “[t]he court has no discretion to deny the plaintiff’s motion, as long as the requirements of section 2 — 1009 were met.” (Emphasis added.) Davis v. International Harvester Co., 139 Ill. App. 3d at 269, citing Bailey v. State Farm Fire & Casualty Co., 137 Ill. App. 3d at 159.

Plaintiff urges application of Metcalfe v. St. Elizabeth’s Hospital (1987), 160 Ill. App. 3d 47, 513 N.E.2d 12, which held that the right to voluntary dismissal is absolute, even where no notice is given to defendants. Our research discloses that Metcalfe is the only case holding that notice is not required pursuant to section 2 — 1009 proceedings. We reject that portion of the Metcalfe holding which ignored the specific requirements of the voluntary dismissal statute and conclude that the better procedure is to require strict compliance with the statute.

This court, in Intaglio Service Corp. v. J.L. Williams & Co. (1983), 112 Ill. App. 3d 824, 445 N.E.2d 1200, affirmed the circuit court’s denial of the plaintiff’s motion to voluntarily dismiss for lack of proper notice. The plaintiff in that case first moved orally and then in writing, without any prior notice as required by rule, to dismiss without prejudice. This was done at a hearing previously set for the defendant’s motion to dismiss. The court held that had the plaintiff given proper notice, the defendant would not have been prejudiced by incurring costs and expending effort in preparing its motion. Intaglio, 112 Ill. App. 3d at 832.

Intaglio is analogous to the case at bar. In both cases, there was a previously set date for the purpose of hearing the defendants’ motions to dismiss. In both cases, the plaintiffs attempted to voluntarily dismiss their cases in violation of the notice rules. In both cases, the defendants spent time and money in defending their cases and in preparing their motions.

We are mindful of Gibellina v. Handley (1989), 127 Ill. 2d 122, 535 N.E.2d 858, and the recent trend to combat “the myriad abusive uses of the voluntary dismissal statute.” (Gibellina, 127 Ill. 2d at 136.) The Gibellina court held that a trial court may hear and decide a defendant’s dispositive motion which has been filed prior to a motion for voluntary dismissal. The Hospital and the Foundation urge this court to apply Gibellina retroactively. Such application, however, is neither warranted nor necessary. It is not warranted because Gibellina may not be applicable to nondispositive motions, and motions directed at discovery abuse are generally not dispositive; it is not necessary because plaintiff’s motion to voluntarily dismiss lacked the requisite notice. We therefore conclude that the circuit court did not err in denying plaintiff’s motion to dismiss the complaint voluntarily.

II

Plaintiff also argues that the circuit court abused its discretion in dismissing his complaint with prejudice as to aU defendants for failure to comply with discovery. He contends that that sanction was too severe.

Supreme Court Rule 219(c)(v) (107 Ill. 2d R. 219(cXv)) states that where a party refuses to comply with discovery rules or court orders relating to them, the court may dismiss the action with or without prejudice. The imposition of sanctions under Rule 219(c)(v) is a matter within the court’s discretion, and a reviewing court should not disturb the trial court’s decision unless abuse is apparent. (Tinsey v. CTA (1986) , 140 Ill. App. 3d 546, 488 N.E.2d 1301.) An abuse of discretion may be found only where no reasonable person would take the view adopted by the trial court. King v. American Food Equipment Co. (1987) , 160 Ill. App. 3d 898, 911, 513 N.E.2d 958, 966, citing In re Marriage of Asch (1981), 100 Ill. App. 3d 293, 426 N.E.2d 1066.

Dismissal of a complaint is a drastic sanction, but one which is authorized where the conduct of the offending party is characterized by a deliberate and pronounced disregard for the rules, orders, and authority of the court. (Lohja v. Checker Taxi Co. (1980), 92 Ill. App. 3d 491, 416 N.E.2d 32; Big Three Food & Liquor, Inc. v. State Farm Fire & Casualty Co. (1979), 79 Ill. App. 3d 63, 398 N.E.2d 264; Sanchez v. Phillips (1977), 46 Ill. App. 3d 430, 361 N.E.2d 36; 612 North Michigan Avenue Building Corp. v. Factsystem, Inc. (1975), 34 Ill. App. 3d 922, 340 N.E.2d 678.) Factors to be considered by the court in determining whether dismissal is appropriate (or in determining what sanction to apply) include the surprise of the testimony to the opposing party; the prejudicial effect of the testimony; the diligence of the opposing party in seeking discovery; timely objection to the testimony; and the good faith of the party calling the witness. Carlson v. General Motors Corp. (1972), 9 Ill. App. 3d 606, 289 N.E.2d 439.

Applying these factors to the instant case, it is apparent that the circuit court did not abuse its discretion in dismissing the complaint. Plaintiff’s deposition certainly could have resulted in surprise to defendants. Defendants do not claim to have ever even seen plaintiff. Thus, his physical condition and appearance alone could have provided critical information necessary for proper preparation. Denial of the opportunity to view plaintiff’s condition and to question him could have resulted in prejudice to defendants. Though plaintiff asserts that his deposition was “o:f little informative value” since defendants were supplied with such items as treating physicians’ reports and answers to non-Rule 220 interrogatories, no alternative form of discovery could provide defendants with an adequate substitute for the opportunity to see and speak with plaintiff himself.

Furthermore, although the failure to obtain plaintiff’s deposition was certainly the primary reason for dismissal, it was not the only one. Plaintiff’s counsel also failed to answer Rule 220 interrogatories which had been filed eight months earlier. Thus, plaintiff’s assertion at oral arguments that his only discovery violation concerned the failure to give his deposition is erroneous.

Defendants’ diligence in seeking plaintiff’s deposition is shown by the numerous dates on which they attempted to depose him. Although it is not clear from the record whether defendants objected to the continuances, there is no question that they acted in good faith in trying to secure plaintiff’s deposition. In view of this record evidence, there is ample justification for the circuit court’s action in dismissing the case with prejudice.

The cases cited by plaintiff are readily distinguishable. In John Biestek & Associates, Ltd. v. Kelly (1989), 192 Ill. App. 3d 301, 550 N.E.2d 230, the appellate court found that the trial court abused its discretion in refusing to vacate a default judgment against a defendant for failure to answer interrogatories within a seven-day period. Biestek, however, involved a pro se defendant and a time period much shorter than that in the case at bar. In Biestek, plaintiff sought a default judgment against the defendant only IV2 months after interrogatories were filed. Here, the discovery abuse was much greater: the Rule 220 interrogatories were left unanswered for eight months and plaintiff’s deposition had been continued for nearly three years.

Wyrick v. Time Chemical, Inc. (1989), 191 Ill. App. 3d 1041, 548 N.E.2d 524, is also distinguishable. In that case, the appellate court reversed a dismissal order as to four of the five defendants. Defendant Time Chemical’s proper motion to dismiss the plaintiff’s complaint was granted and later affirmed. The other four defendants had not joined in Time Chemical’s motion, nor had they made similar motions. In fact, they were not even present when Time Chemical’s motion was presented and the dismissal order entered. For these reasons, none of which are present in the instant case, the order of dismissal was reversed as to the four defendants.

The right of any party to a discovery deposition is basic and fundamental in our adversary system, and thus the right of one party imposes a duty on the other. (Slatten v. City of Chicago (1973), 12 Ill. App. 3d 808, 299 N.E.2d 442.) “Our discovery procedures are meaningless unless a violation entails a penalty proportionate to the gravity of the violation. Discovery for all parties will not be effective unless trial courts do not countenance violations, and unhesitatingly impose sanctions proportionate to the circumstances.” Buehler v. Whalen (1977), 70 Ill. 2d 51, 67, 374 N.E.2d 460, 467.

In this case, we cannot say that dismissal was not the appropriate sanction. Plaintiff repeatedly defied the discovery deadlines set by the circuit court. “[Wjhen a scheme of deliberate defiance of the rules of discovery and the court’s authority or an attempt to stall significant discovery has been shown, such a sanction is appropriate and should be unhesitatingly applied.” (Environmental Protection Agency v. Celotex Corp. (1988), 168 Ill. App. 3d 592, 597, 522 N.E.2d 888, 891.) In Celotex, plaintiff engaged in a pattern of dilatory responses to hearing officers’ orders, unjustifiably canceUed depositions, refused to meet deadlines, and failed to tender reasonable explanations for these actions. The Pollution Control Board struck certain claims as a discovery sanction and subsequently dismissed the remaining counts with prejudice. The appellate court affirmed, stating that “lesser sanctions would be of little avail in advancing timely closure of the pretrial proceedings.” Celotex, 168 Ill. App. 3d at 598, 522 N.E.2d at 892.

That reasoning is applicable to the instant case. By continuously disregarding the discovery schedule, plaintiff exhibited a blatant lack of respect for the court’s authority. When pressed for an explanation, plaintiff’s counsel represented that his client was in poor health and was unable to endure a lengthy deposition. The court asked plaintiff’s counsel to submit medical proof explaining why his client could not appear. No reports were ever tendered. The court attempted to devise a deposition schedule which would accommodate plaintiff’s needs, but plaintiff was uncooperative in this effort. Eventually, plaintiff’s counsel admitted to never even having seen his client. Under these circumstances, we cannot say that the circuit court’s dismissal of the complaint was an improper sanction.

In Shapira v. Lutheran General Hospital (1990), 199 Ill. App. 3d 479, 557 N.E.2d 351, this court recently held that dismissal was an appropriate sanction for discovery violations similar to those in the case at bar. In Shapira, the plaintiff repeatedly disregarded discovery deadlines ordered by the court, even when those deadlines were extended to gain his compliance. The circuit court granted the plaintiff’s section 2 — 1401 petition to vacate the dismissal of his medical malpractice action with prejudice. This court reversed, and in reinstating the dismissal, found that “plaintiff’s contention mocks the bases for four orders entered by the circuit court extending over and over again the time for plaintiff to identify and depose his expert.” Shapira, 199 Ill. App. 3d at 484.

Similarly, plaintiff’s actions in this case amount to a mockery of the court’s authority. Rather than adhering to orders designed to advance his case, plaintiff paid them no regard. Violations of procedural rules designed to expedite litigation cannot be tolerated, especially in light of the ever-growing backlog of cases confronting our courts. (Lohja v. Checker Taxi Co. (1980), 92 Ill. App. 3d 491, 416 N.E.2d 32.) We are mindful of the fact that dismissal is the ultimate sanction. We must, however, be mindful of the messages we send to others. Trial judges must know that we support them in their effort to manage voluminous dockets; enforcement of discovery rules and court-imposed deadlines is essential for case management. Moreover, attorneys and parties must know that any disregard of the court’s authority and of procedural rules will not be tolerated.

We conclude that the circuit court’s dismissal of plaintiff’s complaint with prejudice as a discovery sanction was not an abuse of discretion.

Accordingly, the judgment of the circuit court is affirmed.

Affirmed.

SCARIANO, P.J., and RAKOWSKI, J., concur.


source: Caselaw Access Project

author: JUSTICE BILANDIC

license: Public Domain

text:
    DARIO LEBAJO, Plaintiff-Appellant, v. THE DEPARTMENT OF PUBLIC AID et al., Defendants-Appellees.
    First District (2nd Division)
    No. 1 — 88—2722
    Opinion filed February 19, 1991,

      nunc pro tunc October 23, 1990.

      Wildman, Harrold, Allen & Dixon, of Chicago, for appellant.
    Roland Burris, Attorney General, of Springfield, for appellees.
   JUSTICE BILANDIC

delivered the opinion of the court:

In an administrative review action, the trial court affirmed the order of the Illinois Department of Public Aid (IDEA or Department) terminating plaintiff, Dario Lebajo, M.D., from participating in the medical assistance program and ordering plaintiff to repay the IDEA the sum of $15,118.11. Plaintiff appeals. Ill. Rev. Stat. 1987, ch. 110, par. 3 — 112.

On appeal, plaintiff contends that: (1) the trial court erred in striking a portion of his reply memorandum; (2) the trial court erred in affirming the IDPA’s decision to terminate plaintiff as a participant in the medical assistance program; (3) the trial court erred in affirming the IDPA’s decision to recover from plaintiff $15,118.11 in overpayments; and (4) the trial court erred in refusing to order production of documents used by an IDPA witness to refresh her recollection.

The relevant facts of the instant action are undisputed. On September 13, 1983, plaintiff applied to participate in the IDPA’s medical assistance program. As a participant in this program, plaintiff agreed to dispense medical care to public aid recipients and receive payment from the State for medical services rendered. As a condition of participation, plaintiff was required to keep accurate patient records and bill for his professional services within the limits of a fee schedule.

Plaintiff was employed by Enbeef Health Associates (Enbeef), a group medical practice whose employees were all participants in the medical assistance program. Pursuant to an agreement between En-beef and plaintiff, plaintiff executed an IDPA “Power of Attorney” form, which authorized Noemi N. Borrillo, M.D., a principal of En-beef, to bill the IDPA in plaintiff’s name for patient services rendered individually by plaintiff. Plaintiff also assigned Enbeef his right to receive payment from the IDPA for medical services rendered by plaintiff and billed in his name. Plaintiff notified the IDPA of this agreement by signing the Department’s “Professional Practice as Alternate Payee” form, which designated Enbeef as the payee for medical services rendered by plaintiff.

Plaintiff began working at Enbeef on September 16, 1983, and resigned from Enbeef two months later, on November 19, 1983. During his employment with Enbeef, plaintiff gave medical care to 553 patients and Enbeef billed and received payments from the IDPA for these medical services rendered by plaintiff. Shortly before his resignation from Enbeef, on November 4, 1983, plaintiff terminated his arrangement with Enbeef by notifying the IDPA, in writing, that the power of attorney he granted to Enbeef was revoked. When plaintiff left the employ of Enbeef, he did not take any patient records with him, nor did he maintain his own private records.

On December 6, 1984, the IDPA notified plaintiff that he had been selected for an audit of the records of the 553 patients he treated during his employment with Enbeef. Plaintiff was notified that he was required to submit 344 patient records to the Department auditors. Pursuant to Department policy, the auditors would examine the 344 produced records for billing discrepancies and then extrapolate this amount over the entire 553 patient record universe. Plaintiff informed the auditors that he left the requested records with Enbeef upon termination of his employment there.

Plaintiff did not produce any of the 344 requested records to the IDPA. The auditors maintained that it was plaintiff’s responsibility to maintain and produce the records and, therefore, made no attempts to gain access to the records from Enbeef.

Ms. Little, the Department auditor, conducted the first audit without any of the requested records. Since no records were produced to substantiate the services billed to the Department, the Department sought to recover the total amount paid for services rendered by plaintiff during the audit period. Pursuant to the first audit, the IDEA sought to recover from plaintiff $15,932 in overpayments.

Plaintiff requested an administrative hearing on the Department’s determination. At that hearing, held on August 14, 1985, plaintiff’s counsel appeared before the hearing officer and tendered 64 of the requested records to the Department. Plaintiff’s counsel further requested the hearing officer to issue subpoenas to Enbeef for the remainder of the records. Over the objection of the Department, the hearing officer issued the subpoenas and set a return date of October 24, 1985. -

The subpoenas were served on September 30, 1985. On October 24, 1985, the parties appeared before the hearing officer to receive the subpoenaed records from Enbeef. However, none of the parties subpoenaed appeared at the hearing and no records were tendered pursuant to the subpoenas. At this hearing, plaintiff’s counsel announced that he would pursue enforcement of the administrative subpoenas through the circuit court of Cook County. The administrative hearing was continued to December 5, 1985.

Meanwhile, Ms. Little, the Department auditor, conducted a re-audit utilizing only the 64 records tendered by plaintiff’s counsel at the August 14 administrative hearing. The re-audit disclosed that out of the 344 records requested, plaintiff failed to produce 280 records. Because plaintiff failed to substantiate these billings with any records, the Department sought to recover the full amount paid in these 280 instances. The re-audit further disclosed that the 64 records produced contained 18 instances of failure to specify services rendered for which billings were made and 26 instances of misuse of procedure billing codes. The auditors then took the total dollar discrepancy between the audited sample of records and the total services paid and extrapolated this sum over the universe of 553 records. The re-audit disclosed a total discrepancy of $15,118.11, for which the IDPA sought repayment from plaintiff.

The administrative hearing was resumed on December 5, 1985. Between October 24, 1985, and the resumption of the administrative hearing on December 5, 1985, plaintiff did not attempt to enforce the administrative subpoenas in the circuit court. Plaintiff did not offer any explanation for his inaction.

At the hearing, the IDEA presented the testimony of auditor Little, who testified to the procedure and the results of the re-audit. Ms. Little testified that she refreshed her recollection for her testimony with certain notes taken by her during two interviews with plaintiff. Plaintiff requested that the IDPA produce these documents, which the hearing officer denied.

On March 12, 1986, the IDPA issued a final administrative decision finding that plaintiff, as a participant in the medical assistance program, had breached his duty to the Department to maintain and produce patient records in 280 instances. The IDPA terminated plaintiff as an IDPA medical vendor and ordered plaintiff to repay the IDPA the sum of $15,118.11.

Plaintiff filed a timely complaint for administrative review in the circuit court of Cook County. The trial court granted the IDPA’s motion to strike a portion of plaintiff’s reply memorandum for plaintiff’s failure to raise the argument at the administrative hearing or in his initial memorandum submitted to the trial court. The trial court affirmed the decision of the IDPA terminating plaintiff as a medical vendor and entered a monetary judgment against plaintiff in the amount of $15,118.11. Plaintiff appeals.

I

Plaintiff argues that the trial court erred in striking an argument contained in his reply memorandum. The argument asserted that the Department’s “Professional Practice as Alternate Payee” form established separate rules regarding maintenance of medical records for participants in the Department’s “alternate payee system.”

The law in Illinois is well established that, if an argument is not presented in an administrative hearing, it is waived and may not be raised for the first time before the trial court on administrative review. (Village of Hillside v. John Sexton Sand & Gravel Corp. (1983), 113 Ill. App. 3d 807, 447 N.E.2d 1047.) The rule is particularly applicable where, as here, the issue is one of construction or interpretation of the statutes and rules that most directly concern the agency’s operations. Skate v. Department of Public Aid (1987), 165 Ill. App. 3d 776, 780, 520 N.E.2d 749.

After careful review of the record of the administrative hearing and plaintiff’s initial memorandum submitted to the trial court, we find that nowhere did plaintiff make the argument stricken by the trial court from plaintiff’s reply memorandum. Therefore, plaintiff waived that argument. Accordingly, we find that the trial court properly struck the argument contained in plaintiff’s reply memorandum.

II

Plaintiff’s next assignment of error is that the trial court erred in affirming the IDPA’s decision to terminate his participation as a dispenser of medical services in the medical assistance program. Plaintiff argues that, in the context of a group practice, it is the group practice, not the individual practitioner, that has the duty to maintain and provide records to the IDPA.

With the enactment of the Illinois Public Aid Code (Code), the legislature enabled individuals such as plaintiff to participate in the medical assistance program. (Ill. Rev. Stat. 1987, ch. 23, par. 5— 1 et seq.) Section 5 — 5 of the Illinois Public Aid Code sets forth the individual participant’s duty to maintain patient records:

“All dispensers of medical services shall be required to maintain and retain business and professional records sufficient to fully and accurately document the nature, scope, details and receipt of the health care provided to persons eligible for medical assistance under this Code, in accordance with regulations promulgated by the Illinois Department.” Ill. Rev. Stat. 1987, ch. 23, par. 5 — 5.

Plaintiff has the legal duty to maintain these records, and nothing contained in this Code relieves plaintiff of or modifies this duty. It has been held that this statutory provision gives participants in the medical assistance program, such as plaintiff, notice of their duty to meet minimal professional recordkeeping standards. Boffa v. Department of Public Aid (1988), 168 Ill. App. 3d 139, 144, 522 N.E.2d 644.

The individual participant is also made aware of this duty in the Handbook for Physicians, which is given to medical dispensers upon acceptance into the medical assistance program. Upon receipt of the handbook, the individual participant is put on notice that he retains the ultimate responsibility to maintain and provide the IDPA with patient records upon its request. See Skale v. Department of Public Aid (1987), 165 Ill. App. 3d 776, 520 N.E.2d 749 (IDPA decision to terminate medical dispenser upheld for failure to produce records where the records are in the hands of a third party).

Additionally, plaintiff signed the Department “Professional Practice as Alternate Payee” form, which provides in part:

“4) The practitioner will be responsible for making available to the Department of Public Aid such records as are necessary to disclose fully the extent of the services provided to public aid recipients.
* * *
7) The practitioner retains full responsibility for any bills submitted in his name to the Department of Public Aid even though the group practice has been designated as alternate payee. This responsibility includes liability to repay any over-payments made by the Department.”

While paragraphs 3, 5 and 6 of this form may cause confusion, we find that paragraphs 4 and 7 unequivocally set forth the individual participant’s duty regarding the maintenance of patient records. The ultimate responsibility to provide the IDPA with patient medical and billing records cannot be avoided by the individual participant merely because the IDPA permits restricted assignment of some of the participant’s duties.

This conclusion is particularly compelling in light of the public policy involved in the medical assistance program. Individual doctors apply for and are accepted into this program, which provides medical services to people who are unable to afford medical care. The doctors are paid for their services with the taxpayers’ money. As a condition of participation in this program, the individual participant is required to maintain and provide the IDPA with patient records upon request. A participant’s failure to comply with the requirement to maintain and produce records would result in the inability to verify the participant’s billings and payments for services rendered, with the ultimate result of misuse of taxpayers’ money.

Under the facts of this case, we find that plaintiff failed to even put forth reasonable efforts to fulfill his duty to provide the IDPA with the requested records. At plaintiff’s request, the hearing officer issued a subpoena for the records. Plaintiff was granted a continuance to seek enforcement of the administrative subpoenas in the circuit court. Such relief is available in the circuit court. (See Department of Public Aid v. Kessler (1979), 72 Ill. App. 3d 802, 391 N.E.2d 160.) Yet, at no time did plaintiff even attempt to seek their enforcement, nor did he offer any explanation for his inaction. Instead, plaintiff chose to remain idle and then contend on appeal that he was unable to obtain the records because they were in the possession of Enbeef. To permit plaintiff to now argue on appeal that he was relieved of his duty to provide the IDPA with records in the possession of Enbeef would create a potential avenue for abuse of the medical assistance program.

We therefore conclude that the provisions of the Illinois Public Aid Code and the rules and regulations adopted pursuant thereto place upon the individual practitioner the ultimate responsibility to maintain and produce patient records to the IDPA. Plaintiff has failed to comply. It is not a defense to allege that his legal responsibility has been delegated to a third party. The Code does not permit such conduct. The order to terminate plaintiff as a participant in the medical assistance program is correct.

Ill

Plaintiff makes a number of contentions regarding the propriety of the trial court’s order affirming the IDPA’s decision to recover $15,118.11 from plaintiff.

Plaintiff’s principal contention is that “recovery” from him is improper because payment was, in fact, made to Enbeef. This argument is misplaced. Plaintiff is permitted to assign the money paid by the IDPA for his medical services to whomever he wishes. This does not alter the fact that, under the statutory scheme of the medical assistance program, the individual participant bears the ultimate responsibility to maintain and provide the IDPA with patient records. If the individual practitioner is unable to provide adequate records to substantiate his claims for and receipt of taxpayer money, he bears the corresponding liability for overpayments.

Plaintiff’s argument appears to be based upon the assertion that the IDPA had the duty to obtain the requested records from Enbeef upon plaintiff’s showing that he undertook reasonable efforts to obtain the records. As noted above, we find that plaintiff’s membership in a group practice did not relieve him of the ultimate responsibility to maintain and provide patient records upon request of the IDPA. Plaintiff’s failure to comply with this duty properly results in repayment to the Department the amount of money which he is unable to substantiate with records.

Plaintiff next contends that the IDPA erroneously calculated the amount of money overpaid. We reject plaintiff’s contention that the IDPA’s method of extrapolation used in calculating the amount of overpayments is improper. The IDPA’s use of extrapolation in determining amounts of overpayments has withstood recent constitutional attack. Illinois Physicians Union v. Miller (7th Cir. 1982), 675 F.2d 151.

Plaintiff finally contends that the monetary judgment erroneously includes seven post-November 4, 1983, payments. Plaintiff argues that the IDPA was unauthorized to make these payments to En-beef after receipt of plaintiff’s revocation of the power of attorney on November 4, 1983.

The IDPA pays claims based upon who is authorized to receive payment at the time the billing form is signed. Upon review of the record, we find that these bills were submitted prior to November 4, 1983, and these payments were made for services rendered prior to November 4, 1983. For these reasons, we find that the inclusion of the post-November 4, 1983, payments in the amount plaintiff is ordered to repay the Department is not erroneous.

Accordingly, we affirm the decision ordering plaintiff to repay the sum of $15,118.11 to the IDPA.

IV

Plaintiff’s final assignment of error is that the trial court erroneously refused to order production of the documents used by IDPA auditor, Hope Little, to refresh her recollection a few weeks prior to testifying at the administrative hearing.

An administrative hearing is required to be conducted according to the rules of evidence and privilege as applied in civil cases in the trial courts. (Ill. Rev. Stat. 1987, ch. 127, par. 1012.) In Illinois, upon request, opposing counsel has the right to inspect and use on cross-examination any documents used by a witness, prior to trial, to refresh his or her recollection. Tenenbaum v. City of Chicago (1975), 60 Ill. 2d 363, 325 N.E.2d 607; People v. Scott (1963), 29 Ill. 2d 97, 193 N.E.2d 814.

However, Illinois law also provides that evidentiary errors committed at administrative hearings are harmless where the objecting party fails to demonstrate how the error prejudiced his case. Waste Management of Illinois, Inc. v. Pollution Control Board (1988) , 175 Ill. App. 3d 1023, 1038, 530 N.E.2d 682, appeal denied (1989) , 125 Ill. 2d 575.

Upon review of the record, we find that plaintiff has failed to demonstrate how the trial court’s ruling prejudiced him. Plaintiff has not shown how the production of auditor Little’s notes could have affected the decision of the IDPA. The notes were taken during two interviews conducted by Ms. Little of the plaintiff himself. It is undisputed that plaintiff breached his duty to produce records requested by the IDPA. We have also determined that the method of calculating the amount of repayment ordered is not error. Accordingly, we find that the hearing officer’s failure to allow plaintiff to inspect and use auditor Little’s notes is harmless error.

For the reasons stated herein, we affirm the judgment of the circuit court of Cook County.

Affirmed.

DiVITO, P.J., and HARTMAN, J., concur.

      It would be advisable for the Department to review its standard forms to more clearly reflect the intent and purpose of the Illinois Public Aid Code and the rules and regulations adopted pursuant thereto in order to expedite the audit procedure and avoid delay in obtaining relevant records from practitioners or professional entities with which they are associated.


text:
    THE CITY OF CHICAGO, Plaintiff-Appellee and Cross-Appellant, v. THE DEPARTMENT OF REVENUE, Roger Sweet, Director, Defendant-Appellant and Cross-Appellee.
    First District (2nd Division)
    No. 1 — 89—3060
    Opinion filed February 19, 1991.

      Neil F. Hartigan, Attorney General, of Springfield (Robert J. Ruiz, Solicitor General, and Jerald S. Post, Assistant Attorney General, of Chicago, of counsel), for appellant.
    Kelly R. Welsh, Corporation Counsel, of Chicago (Lawrence E. Rosenthal, Ruth M. Moscoviteh, and Frederick S. Rhine, Assistant Corporate Counsel, of counsel), for appellee.
   JUSTICE DiVITO

delivered the opinion of the court;

Plaintiff City of Chicago (the City) sought judicial review of two decisions by the Department of Revenue (the Department) which denied a real estate tax exemption to four contiguous parcels of land. The circuit court affirmed the Department’s decision denying a tax exemption for the land, but overruled the portion of the decision denying a tax exemption for the two City-owned buildings on the land. The Department appeals the court’s decision that the buildings were tax-exempt; the City cross-appeals the court’s decision that the land was not tax-exempt.

The facts in this case are not in dispute. During the years 1987 and 1988, the property located at 500 North Peshitigo was subleased by the City from the Chicago Dock and Canal Company (Chicago Dock). The City owned the two buildings on the land, which were used solely for municipal purposes. A parking lot was adjacent to the two buildings and was also used for municipal purposes. The underlying land, however, was owned by Chicago Dock-Equitable Venture, a joint venture of Chicago Dock and the Equitable Life Assurance Society of America.

Prior to its sublease with the City, Chicago Dock leased the property to Kraft, Inc., by a long-term lease commencing September 1, 1936, and continuing through April 29, 1986, with an option to extend the term of the lease to April 30, 2016. Under the lease, Kraft had the power to erect any buildings on the property, to remove such buildings, and to hold title to any structures it built on the leased property. Pursuant to this grant of authority, Kraft erected two buildings on the property. Thus, while title to the underlying land remained with Chicago Dock, Kraft held title to and retained ownership, occupancy, and control of the buildings. In addition, Kraft was required by the terms of the lease to pay all taxes on the land and the buildings.

On December 30, 1982, Kraft conveyed all rights, title, and interest in the buildings to the City by quitclaim deed. The City thus became a sublessee of Kraft’s lease with Chicago Dock and, by ordinance, the City exercised its option to extend the sublease until April 29, 2016. Under the sublease, the City became liable for all of Kraft’s financial obligations with respect to the property, including payment of taxes on the entire property.

After acquiring the buildings, the City applied for and was granted a tax exemption for the entire property. On December 17, 1987, however, the Department notified the City that the property would be placed on the tax rolls for 1988. On January 6, 1988, the City filed an application with the Department for a 1988 property tax exemption for the land and the buildings, asserting that the property was owned by a unit of local government, was not producing income, and thus was entitled to an exemption under section 19.6 of the Revenue Act of 1939 (Ill. Rev. Stat. 1987, ch. 120, pars. 500, 500.6). The Department denied the application on January 26, 1988, stating that the property was not in exempt ownership or in exempt use.

On March 21, 1988, pursuant to the City’s request, a formal hearing was held before an administrative law judge. On April 7, 1988, the judge recommended that the land and the improvements thereon be denied tax-exempt status for the 1988 tax year. The decision was approved by the Director of the Department on that same day. On May 13, 1988, the City filed a complaint for administrative review with the circuit court of Cook County.

Before completion of proceedings related to the 1988 tax year, the Cook County assessor’s office notified the City that the property would also be denied an exemption for the 1987 tax year. On March 18, 1988, the City filed a complaint with the Cook County Board of Tax Appeals (the Board). After a hearing, the Board recommended that the entire property remain tax-exempt. The Department, however, overruled the Board’s recommendation, denying the exemption in a final decision on December 9, 1988. The City appealed this decision by filing a second complaint for administrative review on January 13, 1989.

On January 18, 1989, the circuit court consolidated the two administrative review cases and, on August 21, 1989, heard oral arguments. On October 13, 1989, the court affirmed the Department’s denial of an exemption for the underlying land, but overruled the Department’s denial of tax-exempt status for the value of the buildings owned by the City.

On November 9, 1989, the Department filed a notice of appeal, seeking to reverse the circuit court’s decision relating to the tax-exempt status of the value of the buildings. On November 17, 1989, the City cross-appealed, seeking to reverse the circuit court’s decision relating to the tax-exempt status of the land.

The City maintains that the court erred in ruling that the land in question is not exempt from real estate taxation. It argues that the land, although owned by a nonexempt entity, Chicago Dock, is used only for municipal purposes and thus is exempt. (Ill. Rev. Stat. 1987, ch. 120, par. 500.6.) Conversely, the Department maintains that the court’s grant of a tax exemption for the buildings owned by the City was in error. It contends that, despite the City’s ownership of the buildings, the court improperly severed the improvements upon the land from the land itself when ruling upon the real estate tax status.

Initially, it must be noted that the legislature has the exclusive power to raise revenue by taxation and may exempt “the property of *** units of local government.” (Ill. Const. 1970, art. IX, §§1, 6.) The legislature is thus not constitutionally required to exempt any property from taxation and may place restrictions upon the exemptions it does grant. (North Shore Post No. 21 of the American Legion v. Korzen (1967), 38 Ill. 2d 231, 230 N.E.2d 833.) Consequently, there is a presumption that no exemption is intended and the burden of proving the right to exemption is upon the party seeking it. (Rotary International v. Paschen (1958), 14 Ill. 2d 480, 153 N.E.2d 4; Highland, Park Hospital v. Department of Revenue (1987), 155 Ill. App. 3d 272, 279, 507 N.E.2d 1331.) Furthermore, in determining whether property is included within the scope of an exemption, all facts are to be resolved in favor of taxation. Harrisburg-Raleigh Airport Authority v. Department of Revenue (1989), 126 Ill. 2d 326, 331, 533 N.E.2d 1072; Highland Park Hospital v. Department of Revenue, 155 Ill. App. 3d at 279.

In the instant case, the City attempted to receive an exemption based upon section 19.6 of the Revenue Act of 1939 (Ill. Rev. Stat. 1987, ch. 120, par. 500.6), which exempts from taxation “all public buildings belonging to any county, township, city or incorporated town, with the ground on which such buildings are erected.” The City argues that because it owns the buildings, the land under those buildings must be exempt despite nonexempt ownership of the land. The circuit court refused to accept the City’s interpretation of section 19.6, holding that the City’s interpretation of this section would render it unconstitutional.

Article IX, section 6, of the Illinois Constitution provides that the legislature “may exempt from taxation only the property of *** units of local government.” Because the relevant constitutional provision permits exemption only of the property of the City and because the land upon which the City’s buildings stand is not owned by the City, the court found that adoption of the City’s analysis would place the statute in conflict with the constitutional provision. No property except that mentioned in section 6 of article IX of the Constitution may be exempted by any law passed by the legislature; nor can a statute be made broader than the provisions of the Constitution. See Locust Grove Cemetery Association v. Rose (1959), 16 Ill. 2d 132, 137, 156 N.E.2d 577.

Nevertheless, the City argues that because it owns the two buildings, section 19.6 qualifies for tax-free status both the buildings and the leased land upon which they are built. In support, the City maintains that the “common-sense” interpretation of the legislature’s intent is that the land upon which City-owned buildings stand must also be granted an exemption, otherwise a ridiculous result will ensue: the City will have to raise taxes in order to pay taxes.

The City cites several cases for the proposition that public bodies are entitled to exemptions even though they do not own the property in fee simple. These cases, however, are not persuasive and are readily distinguishable. In In re Application of County Collector (1976), 44 Ill. App. 3d 327, 357 N.E.2d 1302, the court held that a common law dedication of land as a public park which operated as an easement of indeterminable duration qualified the land as property of the Village of South Holland thereby entitling the village to an exemption. In People v. Chicago Title & Trust Co. (1979), 75 Ill. 2d 479, 389 N.E.2d 540, the court held that the beneficiaries of land trusts, although not in possession of legal title to the land, were to be considered the owners of the land for tax assessment purposes. The court stated that the term “owner” has no fixed meaning applicable under all circumstances and may include one who has control or occupation of land, whether his interest is an absolute fee or a lesser estate. (People v. Chicago Title & Trust Co., 75 Ill. 2d at 489.) Further, the court in Christian Action Ministry v. Department of Local Government Affairs (1978), 74 Ill. 2d 51, 383 N.E.2d 958, held that a contract for warranty deed as a way of purchasing property, in lieu of a standard mortgage arrangement, would not disqualify a church for tax-exempt status.

Here, the City has only a lease agreement entitling it to the use of the land. Nowhere does the record reflect that the City has control of the land, nor does the City have an interest in the land which could be considered close to a fee simple interest. Rather, the City has a standard lease contract with a private, nonexempt party; further, this type of leasing arrangement has been held not to constitute ownership for purposes of tax exemption. People ex rel. Harding v. City of Chicago (1929), 335 Ill. 450, 167 N.E. 79; People ex rel. Carr v. City of Chicago (1926), 323 Ill. 68, 153 N.E. 725.

In People ex rel. Carr v. City of Chicago, the City leased land which was used for public playgrounds, police department buildings, a fire station, and a hospital. Although all of the land served municipal purposes, the court held that it was ownership, not use, which determined exemptions. Because the City leased the land from a nonexempt party, the land was not exempt. (People ex rel. Carr v. City of Chicago, 323 Ill. at 70-71.) Similarly, in People ex rel. Harding v. City of Chicago, the City subleased land from a nonexempt party. Notwithstanding that the land was used for municipal purposes and the sublease ran for 99 years, the land was not tax-exempt because the owner of the land was not entitled to an exemption. People ex rel. Harding v. City of Chicago, 335 Ill. at 454.

Although neither of these cases involves the same fact situation as the instant case, they do stand for the proposition that a lease, however long, does not constitute ownership for tax-exemption purposes. Despite the Fourth District’s questioning of the holdings of these cases in Cole Hospital, Inc. v. Champaign County Board of Revenue (1983), 113 Ill. App. 3d 96, 99, 446 N.E.2d 562, based upon its interpretation of the subsequent supreme court opinions in Chicago Title & Trust and Christian Action Ministry, we find that both Harding and Carr are persuasive in the instant case. Both Chicago Title & Trust and Christian Action Ministry dealt with situations that involved more than standard lease agreements; the instant case involves nothing more than a lease agreement between the City and Chicago Dock.

Here, the City clearly does not own the land. Moreover, the City has no other interest in the land aside from a standard lease agreement which was passed on to it from Kraft. The land in this case is owned by a private party and is used to make a profit. Simply because the City has contracted to assume the burden of paying taxes does not render property exempt which is not exempt by law. Because the exemption provided for municipalities turns solely on ownership of the property, privately owned land is not entitled to the exemption. (Village of Oak Park v. Rosewell (1983), 115 Ill. App. 3d 497, 501, 450 N.E.2d 981.) This court must construe the exemption provision strictly and cannot create an exemption by judicial interpretation. (Oak Park v. Rosewell, 115 Ill. App. 3d at 500.) Accordingly, the land underlying the buildings does not qualify for an exemption.

The Department argues that the circuit court erred in granting an exemption for the buildings owned by the City. It contends that the circuit court did not have the power to sever the land from the improvements thereon in determining the tax-exempt status. In response, the City maintains that the court properly exempted the buildings pursuant to section 19.6 of the Revenue Act of 1939. Ill. Rev. Stat. 1987, ch. 120, par. 500.6.

In holding that the buildings were tax-exempt, the circuit court stated that “the law is well established that property tax assessments can be apportioned to reflect and exclude those portions of the property which are entitled to tax exemption.” Conceding that this proposition is correct where the land is divided into exempt and nonexempt portions according to the exempt or nonexempt use of such land (Illinois Institute of Technology v. Skinner (1971), 49 Ill. 2d 59, 64, 273 N.E.2d 371; Highland Park Hospital v. Department of Revenue (1987), 155 Ill. App. 3d 272, 507 N.E.2d 1331), the Department argues that it is not correct where the exemption status of the land depends upon the ownership of that land. (See In re Tax Objections of Hutchens (1976), 34 Ill. App. 3d 1039, 341 N.E.2d 169 (holding that a cabin should not have been assessed and taxed separately from the land upon which it stood; however, whether or not the cabin was exempt from taxation was not at issue).) Moreover, the Department argues that land and buildings should not be considered separately taxed components. See Decatur Sports Foundation v. Department of Revenue (1987), 156 Ill. App. 3d 623, 629, 509 N.E.2d 1103.

In Decatur Sports Foundation, the court held that a lessor who leased land to a charitable foundation should have been assessed tax liability for the land and also the improvements upon the land which included a stadium, bleachers, a press box, and other improvements made by the lessee. (Decatur Sports Foundation v. Department of Revenue, 156 Ill. App. 3d 623.) In so holding, the court stated that “the statutory scheme of assessment and enforcement of taxes was not seen to embrace the concept of land and buildings as separately taxed components.” Decatur Sports Foundation v. Department of Revenue, 156 Ill. App. 3d at 629.

Notwithstanding defendant’s assertion that land and buildings must not be taxed separately, several cases have held that portions of property which meet the test for exemption are entitled to a proportionate exemption. Illinois Institute of Technology v. Skinner (1971), 49 Ill. 2d 59, 64, 273 N.E.2d 371; People ex rel. Kelly v. Avery Coonley School (1957), 12 Ill. 2d 113, 117, 145 N.E.2d 80; Highland Park Hospital v. Department of Revenue (1987), 155 Ill. App. 3d 272, 507 N.E.2d 1331.

The court in Skinner held that “ ‘[w]here a tract is used for two purposes, there is nothing novel in exempting the part used for an exempt purpose and subjecting the remainder to taxation.’ ” (Illinois Institute of Technology v. Skinner, 49 Ill. 2d at 64, quoting People ex rel. Kelly v. Avery Coonley School (1957), 12 Ill. 2d 113, 117, 145 N.E.2d 80.) The court further stated:

“Plaintiff next maintains that the tract and buildings are one unit, and that there is no basis for granting only partial exemption. Abundant authority refutes this contention as well.” Illinois Institute of Technology v. Skinner, 49 Ill. 2d at 64.

None of these cases address the precise issue in the instant case. Rather, the cases ascertain whether portions of land or buildings are used for charitable purposes and thus exempt from taxes. Although we can find no cases which are precisely on point, we follow the Illinois Supreme Court rationale in Skinner and find that the buildings, which are owned by the City and used for municipal purposes, are tax-exempt.

In the instant case, two parties, one of whom is a municipality and the other a private party, own separate and distinct portions of property. Simply because one portion of the property happens to be land and the other buildings should not defeat the intent of the legislature, which has provided an exemption for property owned by a city, especially where the exemption is consistent with the Constitution’s allowance for exemptions for the property of a municipality. (Ill. Const. 1970, art. IX, §6; Ill. Rev. Stat. 1987, ch. 120, par. 500.6.) Consequently, the circuit court did not err in holding that the buildings were exempt.

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

Affirmed.

SCARIANO, P.J., and HARTMAN, J., concur.