author: JUSTICE O’CONNOR JUSTICE MANNING,

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. JAMES JONES, Defendant-Appellant.
    First District (1st Division)
    No. 1 — 89—1205
    Opinion filed December 10, 1990.

      MANNING, J., dissenting.
    Randolph N. Stone, Public Defender, of Chicago (Kim L. Sorrells and Donald S. Honchell, Assistant Public Defenders, of counsel), for appellant.
    Cecil A. Partee, State’s Attorney, of Chicago (Renee Goldfarb, David R. Butzen, and Howard D. Weisman, Assistant State’s Attorneys, of counsel), for the People.
   JUSTICE O’CONNOR

delivered the opinion of the court:

Following a bench trial, defendant, James Jones, was convicted of possession of a controlled substance. He was sentenced to 18 months’ periodic imprisonment. On appeal defendant argues that the trial court erred in denying his pretrial motion to suppress evidence.

At the pretrial hearing, Chicago police officer Duffin testified that on May 31, 1987, he was traveling along Ashland Avenue when he noticed an automobile with a cracked windshield, which he described as a “hazardous vehicle.” The officer pulled the car over into a restaurant parking lot, and he and his partner exited the squad car. As Officer Duffin approached the vehicle, he noticed the driver making turning movements. As the officer got closer, he saw defendant place a plastic bag underneath the armrest between the seats. At this time he ordered defendant out of the vehicle, entered the car and retrieved the plastic bag. The bag contained 108 grams of marijuana. The officers placed defendant under arrest and searched him. The search revealed additional marijuana as well as United States currency.

In denying the motion to suppress, the court specifically noted that the officer saw defendant placing the plastic bag under the armrest and that he saw part of the plastic bag.

At trial, defendant testified that the car he was driving was not his and that he was unaware that there was any marijuana in the car. The parties stipulated that the officer would testify as he had at the pretrial hearing.

On appeal, defendant argues that the trial court’s denial of the motion to suppress was manifestly erroneous because the State failed to prove that the initial stop was justified. Additionally, defendant contends that even if the traffic stop was justified, there was no probable cause to seize the plastic bag.

Both parties cite the Illinois Vehicle Code, which makes it unlawful for a person to drive a vehicle where the windshield is in such defective condition as to materially impair the driver’s vision. (Ill. Rev. Stat. 1987, ch. 951/2, par. 12 — 503(e).) Defendant suggests, without citation to any authority, that because there was no testimony that defendant’s vision was materially impaired, the officers lacked probable cause for the stop and the seizure was illegal. A police officer may, however, stop a vehicle in a public place for a reasonable period of time when the officer reasonably infers from the circumstances that the person is violating the Illinois Vehicle Code. (See Ill. Rev. Stat. 1987, ch. 38, par. 107 — 14; see also People v. Stroud (1989), 189 Ill. App. 3d 1034, 546 N.E.2d 293.) Here, the evidence is incontroverted that the windshield of the vehicle defendant was driving was cracked. This fact supports the conclusion that the stop was justified (cf. People v. LaGrone (1984), 124 Ill. App. 3d 301, 464 N.E.2d 712), and not merely pretextual, a problem of concern to re-viewing courts. (People v. Patterson (1980), 88 Ill. App. 3d 144, 410 N.E.2d 223.) Because the initial stop was lawful, we need not address defendant’s contentions regarding the inapplicability of the doctrines of plain view and search incident to arrest.

Defendant also argues that even assuming that the initial stop was valid, the subsequent search was improper because the officer lacked probable cause. Probable cause to search an automobile exists when, in light of totality of the circumstances, a reasonable person would believe that there was contraband in the vehicle. (People v. Clark (1982), 92 Ill. 2d 96, 440 N.E.2d 869.) We agree with defendant that defendant’s twisting motion, without more, would not give rise to probable cause. Here, however, the officer noticed not only defendant’s twisting motion, but saw defendant place the bag under the armrest, suggesting that defendant was attempting to hide something. Based on the record before us we cannot say that the trial court’s denial of the motion to suppress was manifestly erroneous. Accordingly, the judgment of the circuit court is affirmed.

Judgment affirmed.

BUCKLEY, P.J., concurs.

JUSTICE MANNING,

dissenting:

I respectfully dissent. While I agree with the majority that the officer’s stop of the car was justified based on the traffic violation, there was no probable cause to search defendant’s car. The officer testified that he initially observed the defendant “twisting” in the front seat of the car, but was unable to see his hands at that point. The twisting movement was observed from the rear of the car. Once he approached the vehicle, he saw defendant “placing” a plastic bag underneath the armrest and between the front seat of the vehicle. It is important to note what the officer did not see in trying to determine if probable cause existed. The officer only saw a “few inches” of the bag. He did not testify that he observed the color or substance of the contents of the bag. He did not observe anything that appeared to be a weapon. He did not testify that based on his prior investigative experience he knew that marijuana was transported in clear plastic bags. He did not observe any crushed green leaves or leafy substance. He ordered the defendant out of the car, so there was no danger to the officer, nor did the officer so testify.

I agree with the defendant that the presence of plastic in an automobile is insufficient to give a police officer probable cause. The search of a motor vehicle must be based on probable cause. (Chambers v. Maroney (1970), 399 U.S. 42, 51, 26 L. Ed. 2d 419, 428, 90 S. Ct. 1975, 1981.) Probable cause is based on the totality of the circumstances known at the time that would give a reasonable person a belief that contraband was present. (People v. Penny (1989), 188 Ill. App. 3d 499, 502, 544 N.E.2d 1015.) The defendant in the case at bar was stopped for a minor traffic violation only. Thereafter, the officer observed two things, i.e., a twisting movement seen from behind and a plastic bag placed under an armrest. The totality of the circumstances is devoid of any connection to criminal behavior, in the absence of an observation of at least the color or nature of the substance contained in such a bag. (See, e.g., People v. Kelly (1979), 76 Ill. App. 3d 80, 394 N.E.2d 739.) The instant case is very similar to People v. Collins (1977), 53 Ill. App. 3d 253, 368 N.E.2d 1007, wherein that defendant was stopped for a minor traffic violation, the officer observed him lean forward and to the right, and then, after ordering defendant out of the car, observed a brown paper bag, opened it and discovered that its contents consisted of cannabis.

While in Collins the discovery of the bag was subsequent to the ordering of defendant out of the car and here the plastic bag was seen before defendant was ordered out, the principle is the same. The defendant in Collins was ordered out of the car because the officer noted that he leaned forward. The defendant in the case at bar was ordered out of the car because he was observed “twisting” and the officer observed a few inches of plastic protruding from underneath an armrest. In neither case was there sufficient evidence to justify a search of the defendant’s automobile.

Furthermore, the record is devoid of any evidence that the defendant committed any other traffic violation that would have necessitated his detention and arrest, i.e., failure to possess a driver’s license, etc. The court, in ruling, determined that it need not consider the “manner in which the defendant moved or did not move.” The basis for the court’s denial of defendant’s motion was solely the fact that the officer saw defendant place a bag underneath the armrest, and he observed that the bag was plastic.

While under more specific circumstances, i.e., observation of crushed, leafy substance, or even testimony by the officer that in the officer’s experience he has noted the use of plastic to transport cannabis, I would agree with the majority. However, in the case at bar, the record is woefully lacking for purposes of probable cause. The search was not justified by the totality of circumstances. (See generally New York v. Belton (1981), 453 U.S. 454, 69 L. Ed. 2d 768, 101 S. Ct. 2860.) I would reverse for the reason that the trial court’s denial of defendant’s motion to suppress is manifestly erroneous.


source: Caselaw Access Project

author: JUSTICE WHITE

license: Public Domain

text:
    MYRON (MIKE) WOLENS et al., Indiv. and on Behalf of Others Similarly Situated, Plaintiffs-Appellees, v. AMERICAN AIRLINES, Defendant-Appellant. — P.S. TUCKER, on Behalf of Herself and all Others Similarly Situated, Plaintiff-Appellee, v. AMERICAN AIRLINES, Defendant-Appellant.
    First District (3rd Division)
    No. 1 — 89—0918
    Opinion filed December 12, 1990.

      Jerold S. Solovy, Glenn K. Seidenfeld, and Marguerite T. Tompkins, all of Jenner & Block, of Chicago, for appellant.
    Gilbert W. Gordon and Robert Marks, both of Marks, Marks & Kaplan, Ltd., and Michael J. Freed and Michael B. Hyman, both'of Much, Shelist, Freed, Denenberg, Ament & Eiger, P.C., both of Chicago, for appellees Myron Wolens, Albert J. Gale, R. Craig Zafis, Bret Maxwell, and Robert Nelson.
    Marvin Miller, of Chertow & Miller, of Chicago, and Nicholas E. Chúmeles, Brenda M. Nelson, and Robin Resnick, all of Greenfield & Chimicles, of Haverford, Pennsylvania, for appellee P.S. Tucker.
   JUSTICE WHITE

delivered the opinion of the court:

Defendant American Airlines has filed this interlocutory appeal from an order of the circuit court denying defendant’s motion to dismiss plaintiffs’ complaints. Defendant contends that plaintiffs’ claims are preempted by Federal law and barred by the commerce clause.

In 1988, plaintiffs Myron Wolens, Albert Gale, R. Craig Zafis, Bret Maxwell, and Robert Nelson filed a class action complaint against defendant in the circuit court of Cook County. The complaint alleged that in 1981 or 1982, defendant created the AmericanAirlines AAdvantage frequent flyer program and solicited public membership in the program through advertisement in the national media and general mailings. Plaintiffs alleged that this solicitation constituted a unilateral contract offer which they accepted when they joined the program sometime prior to 1988.

Plaintiffs alleged that after joining the program and receiving materials from defendant detailing the available benefits and the mileage credits required therefor, they accumulated mileage credits by using the airlines and facilities of defendant and of those participating with defendant, even if other less costly or more convenient services were available. Plaintiffs further alleged that the value of their credits was substantially and adversely affected when, on May 18, 1988, defendant unilaterally instituted a retroactive reduction in the benefits available in exchange for the credits.

Plaintiffs charged that defendant’s action in unilaterally and retroactively reducing program benefits constituted a breach of defendant’s contracts with plaintiffs and all others who joined the program prior to May 1988. Plaintiffs also charged that defendant’s action was in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (Consumer Fraud Act) (Ill. Rev. Stat. 1989, ch. 121V2, par. 261 et seq.). Plaintiffs sought monetary damages and an injunction preventing retroactive application of any changes in the program to mileage credits earned prior to such changes.

Defendant removed the action to the United States District Court for the Northern District of Illinois on the ground that the complaint raised a Federal question exclusively committed to adjudication in the Federal courts by section 1305(a)(1) of the Federal Aviation Act (49 U.S.C. § 1305(a)(1) (1988)). The district court remanded the action to the circuit court, finding that plaintiffs’ complaint was grounded in State law and that nothing in section 1305 or its legislative history indicated a congressional intent to convert plaintiffs’ State contract and fraud claims into Federal actions removable to Federal court. Wolens v. American Airlines, Inc. (N.D. Ill., Oct. 25, 1988), No. 88-C-8158.

Subsequent to the district court’s order remanding the action to the circuit court, a second class action complaint was filed against defendant by P.S. Tucker. The second complaint, like the first, alleged that defendant’s action in retroactively modifying the rules of the frequent flyer program constituted a breach of contract and violated the Consumer Fraud Act.

The two actions were consolidated, and defendant moved to dismiss both, contending that the causes of actions were expressly preempted by section 1305(a). Defendant also argued that plaintiffs’ actions were barred by the commerce clause because subjecting airlines to State consumer fraud and common law contract claims would impose a burden on interstate commerce.

On March 20, 1989, the circuit court entered a memorandum opinion and order denying defendant’s motion to dismiss. The court found that section 1305 did not preempt plaintiffs’ claims and that nothing in the record indicated that prosecution of plaintiffs’ claims would burden interstate commerce.

On March 23, the court granted defendant’s motion for certification of a question for interlocutory appeal. The question certified for appeal was: “Whether plaintiffs’ claims are preempted by the Federal Aviation Act of 1958, as amended, 49 U.S.C. §§1301 — 1557, and by the federal regulations promulgated thereunder, and precluded under the Commerce Clause of the United States Constitution[.]” We conclude that this question must be answered in the negative.

Opinion

The United States Supreme Court acknowledged in Wardair Canada, Inc. v. Florida Department of Revenue (1986), 477 U.S. 1, 91 L. Ed. 2d 1, 106 S. Ct. 2369, that Congress had regulated aviation extensively. However, the Court also pointed out that State law is not preempted whenever there is any Federal regulation of an activity or industry. 477 U.S. at 6, 91 L. Ed. 2d at 8, 106 S. Ct. at 2372.

There are three instances where Federal law will be found to preempt State law: (1) where Congress has expressly preempted State law; (2) where congressional intent to preempt may be inferred from the pervasiveness of the Federal regulatory scheme; and (3) when State law conflicts with the Federal law or interferes with the achievement of congressional objectives. (West v. Northwest Airlines, Inc. (9th Cir. Sept. 11, 1990), No. 89 — 35820; O’Carroll v. American Airlines, Inc. (5th Cir. 1989), 863 F.2d 11.) In the case before us, defendant contends that plaintiffs’ claims are expressly preempted by section 1305. Defendant also contends that section 1305 and its legislative history demonstrate a congressional intent to occupy the entire field and exercise exclusive Federal control over aviation matters. Finally, defendant argues that the commerce clause bars plaintiffs’ claims.

I. EXPRESS PREEMPTION

Section 1305(a) provides:

“[N]o State or political subdivision thereof and no interstate agency or other political agency of two or more States shall enact or enforce any law, rule, regulation, standard, or other provision having the force and effect of law relating to rates, routes or services of any air carrier ***.” 49 U.S.C. § 1305(a) (1988).

Defendant argues that all of plaintiffs’ claims are directly related to defendant’s rates or services and, therefore, are preempted.

Plaintiffs’ breach of contract and Consumer Fraud Act claims seek to recover damages for the loss in value of their mileage credits. Plaintiffs also request orders enjoining defendant from applying any subsequent changes in the frequent flyer program to plaintiffs.

Initially we note that private actions for injunctive relief may not be maintained under the Consumer Fraud Act. (Martin v. Eggert (1988), 174 Ill. App. 3d 71, 528 N.E.2d 386.) In addition, we find that any attempt to enjoin defendant’s application of its new program rules would be an attempt to regulate the services of an airline and thus a violation of section 1305. See Hingson v. Pacific Southwest Airlines (9th Cir. 1984), 743 F.2d 1408; Anderson v. USAIR, Inc. (D.C. 1985), 619 F. Supp. 1191, affd (D.C. Cir. 1987), 818 F.2d 49.

However, we also find that plaintiffs’ claims for damages for breach of contract and violation of the Consumer Fraud Act are not preempted by section 1305. See Beineman v. City of Chicago (7th Cir. 1988), 864 F.2d 463; Hingson v. Pacific Southwest Airlines (9th Cir. 1984), 743 F.2d 1408; In re Air Crash Disaster at John F. Kennedy International Airport on June 24, 1975 (2d Cir. 1980), 635 F.2d 67; Wolst v. American Airlines, Inc. (N.D. Ill. 1987), 668 F. Supp. 1117; Anderson v. USAIR, Inc. (D.C. 1985), 619 F. Supp. 1191; Brunwasser v. Trans World Airlines, Inc. (W.D. Pa. 1982), 541 F. Supp. 1338.

In Anderson and Hingson, blind plaintiffs brought suit alleging that the defendant airlines’ policy of excluding blind persons from occupying certain seats on aircraft violated local laws providing equal access for and' precluding discrimination against the handicapped. The court of appeals in Hingson and the Federal district court in Anderson both held that the State laws in question were preempted by section 1305. The courts stated that the term “services” as used in section 1305 included the regulation of air carrier seating policies for handicapped persons. Hingson, 743 F.2d at 1415-16; Anderson, 619 F. Supp. at 1198.

However, the courts in Hingson and Anderson also found that the blind plaintiffs’ common law claims for damages for intentional infliction of emotional distress were not preempted by section 1305. (Hingson, 743 F.2d at 1416; Anderson, 619 F. Supp. at 1197.) Several other courts have also concluded that common law actions for damages are not preempted by section 1305. See West v. Northwest Airlines, Inc. (9th Cir. Sept. 11, 1990), No. 89 — 35820; Bieneman v. Chicago, 864 F.2d at 471; In re Air Crash Disaster at John F. Kennedy International Airport on June 21, 1975, 635 F.2d at 74; Holliday v. Bell Helicopters Textron, Inc. (1990), 747 F. Supp. 1396; New York v. Trans World Airlines, Inc. (S.D. N.Y. 1989), 728 F. Supp. 162; Illinois Corporate Travel, Inc. v. American Airlines, Inc. (N.D. Ill. 1988), 682 F. Supp. 378, 380 n.l, aff’d (7th Cir. 1989), 889 F.2d 751; Wolst v. American Airlines, Inc. (N.D. Ill. 1987), 668 F. Supp. at 1119; Brunwasser v. Trans World Airlines, Inc. (W.D. Penn. 1982), 541 F. Supp. at 1345; Stream Aviation, Inc. v. Anders Production, Inc. (La. App. 1987), 517 So. 2d 1157; People v. Western Airlines, Inc. (1984), 155 Cal. App. 3d 597, 202 Cal. Rptr. 237.

We are aware that some courts have reached an opposite conclusion. (See Mattox v. Trans World Airlines, Inc. (5th Cir. 1990), 897 F.2d 773; O’Carroll v. American Airlines, Inc. (5th Cir. 1989), 863 F.2d 11 (both holding that common law claims against an airline were preempted by section 1305).) However, we believe that the better reasoned view is that expressed in West v. Northwest Airlines, Inc. There, the Ninth Circuit Court of Appeals stated:

“[W]e disagree with Northwest and the district court that ‘law[s] ... relating to airline services’ encompasses all state laws that affect airline services, however tangentially. This interpretation of § 1305(a)(1) would unduly expand preemption and ignore our presumption against federal preemption in this traditional state law area. Instead, we find that Section 1305(a)(1) preempts claims only when the underlying statute or regulation itself relates to airline services, regardless of whether the claim arises from a factual setting involving air services. Thus, state laws that merely have an effect on airline services are not preempted (emphasis added).” West v. Northwest Airlines, Inc. (9th Cir. Sept. 11, 1990), No. 89— 35820.

The claims for damages in the present case arise out of plaintiffs’ contracts with defendant. The claims bear only a tangential relation to defendant’s rates and services and any effect that an award of damages would have on defendant’s rates and services would be remote and indirect. (New York v. Trans World Airlines, Inc., 728 F. Supp. at 176; see also Nader v. Allegheny Airlines, Inc. (1976), 426 U.S. 290, 300, 48 L. Ed. 2d 643, 652, 96 S. Ct. 1978, 1985 (holding that any impact on rates that may result from the imposition of common law tort liability or from practices adopted by a carrier to avoid such liability would be incidental); Beineman v. Chicago, 864 F.2d at 471 (pointing out that State courts award damages every day in air crash cases notwithstanding the fact the Federal law preempts State regulation of safety in air travel).) Accordingly, we conclude that section 1305 does not expressly preempt plaintiffs’ actions for damages for breach of contract and violation of the Consumer Fraud Act.

II. IMPLIED PREEMPTION

Defendant argues that the extensive regulation of the field of aviation by Congress and the Department of Transportation demonstrates congressional intent to occupy the entire field. Defendant bases its argument on sections 1302(a)(7) and 1381 of the Federal Aviation Act (49 U.S.C. §§1302(a)(7), 1381(1988)) and the provisions of the Civil Aeronautics Board Sunset Act of 1984 (Sunset Act) (Pub. L. No. 98 — 443, 98 Stat. 1703 (1984)). Defendant argues that these authorities establish that Congress intended that the Department of Transportation have exclusive authority for regulating advertising and preventing deceptive practices by airlines. We disagree.

Section 1302(a)(7) states only that the prevention of unfair, deceptive, predatory, or anticompetitive practices in air transportation shall be considered in the public interest and in accordance with the public convenience. Nothing in its language gives rise to an inference that section 1302(a)(7) was intended to foreclose State damage actions against an airline for engaging in deceptive practices. See New York v. Trans World Airlines, Inc., 728 F. Supp. at 177.

Turning to defendant’s argument that section 1381 indicates a congressional intent to preclude State consumer protection claims, we note that a similar argument was rejected by the Supreme Court in Nader v. Allegheny Airlines. There, the Court held that section 1381 did not eliminate State court common law or statutory claims against airlines for fraud; rather, the Court ruled that such claims were preserved by section 1506 of the Federal Aviation Act (49 U.S.C. §1506 (1988)). Nader, 426 U.S. at 300, 48 L. Ed. 2d at 652, 96 S. Ct. at 1985.

Section 1506 provides:

“Nothing in this chapter shall in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this chapter are in addition to such remedies.” (49 U.S.C. §1506 (1988).)

The Supreme Court found that section 1381 was intended, not to preclude, but to supplement the compensatory common law remedies for private parties preserved under section 1506. Nader, 426 U.S. at 300-01, 48 L. Ed. 2d at 653, 96 S. Ct. at 1985.

Defendant contends that the Nader decision cannot be considered as controlling because the decision predated the Sunset Act of 1984. Defendant argues that a statement in the legislative history of the Sunset Act, that the Act preempts State regulation of consumer protection and unfair competitive practices, indicates that Congress intended to preempt plaintiffs’ claims.

As our earlier discussion points out, an award of damages for breach of contract or violation of the Consumer Fraud Act does not amount to “State regulation.” Further, Congress in passing the Sunset Act in 1984 is presumed to have been aware of the Supreme Court’s 1976 holding in Nader that section 1506 preserved State common law claims for fraud. Thus, Congress’ retention of section 1506 following passage of the Sunset Act indicates its tacit approval of the Supreme Court’s decision. Accordingly, we find that Congress did not intend the Sunset Act to preempt plaintiffs’ State law damage claims.

III. COMMERCE CLAUSE

Defendant argues that the circuit court erred in holding that the commerce clause did not bar plaintiffs’ claims. Defendant contends that by seeking an injunction in an Illinois court that will require defendant to provide specific services to its frequent flyer program members nationwide, plaintiffs are attempting to regulate interstate commerce.

In our discussion above, we pointed out that plaintiffs could not maintain a private action for injunctive relief under the Consumer Fraud Act and that any attempt to enjoin defendant’s action would constitute improper State regulation of the activities of an airline. In light of the foregoing, defendant’s arguments that an injunction would violate the commerce clause are moot.

In conclusion, we find that although plaintiffs’ claims for injunctive relief are expressly preempted by section 1305, plaintiffs’ common law and statutory damage claims are neither expressly nor implicitly preempted. Accordingly, the order of the circuit court denying defendant’s motion to dismiss is affirmed.

Affirmed.

RIZZI and FREEMAN, JJ., concur.

      The statements defendant relies on are contained in House. Report 793 (H.R. No. 793, 98th Cong., 2d Sess. 4, reprinted in 1984 U.S. Code Cong. & Admin. News 2857, 2860). The House Report provides:
      “In addition, to protecting consumers, federal regulation insures a uniform system of regulation and preempts regulation by the states. If there was no Federal regulation, the states might begin to regulate these areas, and the regulations could vary from state to state. This would be confusing and burdensome to airline passengers, as well as to the airlines.”

       Justice Freeman concurred in this opinion prior to his election to the Illinois Supreme Court.


author: JUSTICE FREEMAN

text:
    JERRY COLEMAN, Plaintiff-Appellant, v. JAMES O’GRADY, Sheriff of Cook County, et al., Defendants-Appellees.
    First District (3rd Division)
    No. 1 — 89—1571
    Opinion filed December 12, 1990.

      Rick M. Schoenfield, of Ettinger & Schoenfield, of Chicago, for appellant.
    Cecil A. Partee, State’s Attorney, of Chicago (Joan T. Agnew, Assistant State’s Attorney, of counsel), for appellee.
   JUSTICE FREEMAN

delivered the opinion of the court:

Plaintiff, Jerry Coleman, filed a complaint for administrative review of his termination as a deputy sheriff against the sheriff of Cook County, his director of inspections and internal affairs division (hereinafter collectively the Sheriff) and the Cook County Sheriff’s Merit Board (Merit Board). The original complaint was dismissed on the ground that, contrary to his allegation therein, plaintiff had not been terminated by the Merit Board. Thereafter, plaintiff filed a first amended complaint alleging that his termination by the Sheriff without a Merit Board hearing was wrongful under Illinois law and denied him procedural due process in violation of 42 U.S.C. §1983. The first amended complaint was dismissed with prejudice on the ground of laches. Plaintiff appeals.

Plaintiff was employed as a deputy sheriff beginning in 1978. His employment predated the establishment of the Merit Board. (Ill. Rev. Stat. 1985, ch. 125, par. 52.) Plaintiff completed the deputy sheriff recruit training and probationary police officer’s programs in April 1985. The Merit Board certified him as eligible for appointment as a full-time deputy sheriff on October 1, 1985. The Sheriff appointed plaintiff to the position of deputy sheriff on November 30, 1985. Plaintiff, like all appointees to the position of full-time deputy sheriff, then began serving a probationary period of 12 months during which he could be discharged at the will of the Sheriff. (Ill. Rev. Stat. 1985, ch. 125, par. 58.) Non-probationary deputy sheriffs, in contrast, can be discharged only for cause upon written charges and only after being given a Merit Board hearing. (Ill. Rev. Stat. 1985, ch. 125, par. 62.) Plaintiff was arrested by the Chicago police on May 17, 1986, during his probationary period, for the offense of assault. The Sheriff then began an investigation into the May 17 incident. As a result of the investigation, on December 1, 1986, the Sheriff ordered that plaintiff be suspended for 29 days. Plaintiff appealed the suspension order and prevailed in his appeal. However, on April 21, 1987, i.e., after his probationary period, plaintiff was terminated as a result of the investigation. He filed his complaint for administrative review on August 3, 1988.

Opinion

On appeal, plaintiff first contends that his action was not barred by the doctrine of laches because, as in People ex rel. Casey v. Health & Hospitals Governing Comm’n (1977), 69 Ill. 2d 108, 370 N.E.2d 499, there was a reasonable excuse for his delay in bringing suit to challenge his termination.

His delay was reasonable, plaintiff asserts, because after his termination and up to the filing of his original complaint, he was awaiting, first, the Merit Board hearing to which he knew he was entitled and, second, notification of the Merit Board’s termination of him without having first notified him. Plaintiff thus reasons that defendants should be barred from asserting laches because his delay in bringing suit was caused by their wrongdoing, i.e., failing to give the Merit Board hearing to which he was entitled before he could be terminated.

We reject plaintiff’s analysis. Simply put, we find utterly illogical plaintiff’s argument, in essence, that, although he knew he was entitled to a Merit Board hearing before he could be properly terminated, after defendants purported to terminate him and he ceased working as a deputy sheriff, he did not bring suit to challenge that termination because he was awaiting the Merit Board hearing to which he was entitled. The unreasonableness of plaintiff’s justification for his delay in bringing suit is manifest, especially given the fact that plaintiff does not contend that he was misled or induced into believing that he would eventually be given a Merit Board hearing by anything the Sheriff or any of his agents said or did.

In arguing that his delay in bringing suit was reasonable, plaintiff notes that laches arises where there is, inter alia, a delay despite a plaintiff’s knowledge of the facts upon which his claim is based (Mitchell v. Simms (1979), 79 Ill. App. 3d 215, 398 N.E.2d 211) or of the defendant’s conduct and an opportunity to sue (Pyle v. Ferrell (1958), 12 Ill. 2d 547, 147 N.E.2d 341). What we fail to see, however, is how plaintiff can seriously argue that he did not know the facts upon which his instant claim was based or did not know the conduct of defendants giving rise to that claim as of the moment defendants purported to terminate him without a Merit Board hearing. Such an argument is completely irreconcilable with plaintiff’s admission that he knew he could be properly terminated only after a Merit Board hearing. We find plaintiff’s excuse for his delay in bringing suit to challenge his termination completely unreasonable. Moreover, we find unavailing plaintiff’s assertion that the Sheriff should be barred from asserting laches because plaintiff’s delay was the result of the Sheriff’s wrongdoing. This assertion is based on a misreading of the Casey decision, which we expand upon below.

We also find plaintiff’s instant action barred on the ground of laches due to the prejudice to the Sheriff resulting from the plaintiff’s delay in bringing suit to challenge his termination.

Plaintiff asserts that the Sheriff was not prejudiced by his delay in bringing suit, despite the Sheriff’s claim of prejudice in having to pay both plaintiff’s back wages, if he were ultimately successful on his suit, and the wages of plaintiff’s replacement. Plaintiff argues that the Sheriff was not induced or misled into hiring plaintiff’s replacement by his delay in bringing suit. Plaintiff thus implies that, for prejudice to result to a public employer in this type of case, it must have hired a replacement employee in reliance upon the failure of a discharged employee to challenge his termination in a timely manner. This, however, is not the law as we construe it.

In Kadon v. Board of Fire & Police Commissioners (1964), 45 Ill. App. 2d 425, 195 N.E.2d 751, the pertinent issue was whether the suit of a fireman seeking promotion to lieutenant was barred by laches. In resolving that issue, the court reasoned:

“[I]n civil service cases, where prolonged delay may easily prejudice governmental bodies, impair orderly procedures and work to the disadvantage of third parties, time is an essential factor. The most stringent requirement timewise is in those cases brought by civil service employees to compel reinstatement and payment of back salaries after discharges alleged to be illegal. A rule has been established that if these actions are not brought within six months of the discharge they will be barred on the ground of laches, unless a reasonable explanation can be given for the delay.” Kadon, 45 Ill. App. 2d at 430.

In People ex rel. Sullivan v. Smith (1971), 133 Ill. App. 2d 218, 272 N.E.2d 755, the court, in holding that a cause of action for reinstatement to the position of city housing inspector was barred by laches, stated, after citing the relevant case law, including the foregoing language from Kadon:

“The instant case fits squarely within the rule enunciated in the above cases. Plaintiff introduced no evidence to explain his delay. Third persons have necessarily performed the duties of plaintiff’s former position and have been compensated therefor. Plaintiff’s request for reinstatement and compensation for the 19 months since the expiration of his leave of absence — at which time he could have brought this action — unquestionably prejudices defendant City of Chicago, which, if plaintiff were to succeed, would be required to pay for the same services twice over a substantial period of time. This is one of the reasons why delay alone is inherently prejudicial in cases of this type, and gave rise to the 6-month laches rule.” Sullivan, 133 Ill. App. 2d at 220.

In Casey, upon which plaintiff also relies for the second prong of his laches argument, the supreme court stated:

“The defendants contend that prejudice to an employer is inherent any time a public employee delays in seeking reinstatement because another person must be hired to replace the discharged employee. That is, if the employee succeeds in securing accrued back pay, the employer must pay him for services rendered by a third person and for which that third person had already been compensated. Thus, the longer the delay, the greater the burden on the employer. We recognize this risk and agree that the defense of laches should be available to an employer when sued by a discharged public employee.” Casey, 69 Ill. 2d at 115.

The foregoing cases conclusively reveal that it is prejudice in the sense of having to pay both a replacement worker’s salary during a former employee’s delay in challenging his termination and that employee’s back wages, if his challenge ultimately succeeds, which will justify application of laches to such a suit. It is not, as plaintiff asserts, prejudice in the sense of being induced to hire a replacement worker by the former employee’s delay in challenging his termination which must exist to apply the doctrine of laches. As such, the fact that plaintiff’s delay in challenging his termination did not induce the hiring of a replacement is irrelevant to the determination of prejudice to the Sheriff from plaintiff’s delay in bringing suit. The prejudice to the Sheriff inherent in that delay cannot be ignored absent a reasonable excuse.

Although not cited by plaintiff, we must take issue with case law subsequent to Casey which seems to support plaintiff’s position in the instant case.

The first such cause is Chriswell v. Rosewell (1979), 70 Ill. App. 3d 320, 388 N.E.2d 175. In Chriswell, the court rejected the argument that a county probation officer’s claim for back pay was barred by the doctrine of laches. In so doing, the court reasoned that, based upon its citation to rules requiring proof of prejudice and injury from a delay in bringing suit, the Casey majority apparently rejected the contention, relied upon by the dissent therein, that the six-month rule barred recovery. Chriswell, 70 Ill. App. 3d at 326.

We believe the Chriswell court erred in concluding that the Casey court rejected the six-month rule which the dissent therein relied upon and which was applied in Kadon and Sullivan for two reasons.

The first is the Casey court’s citation to the case of Schultheis v. City of Chicago (1909), 240 Ill. 167, 170, 88 N.E. 563, for the rule that, where an unreasonable delay is apparent on the face of a complaint, the plaintiff has an affirmative duty to set forth a valid excuse therefor, or the action may be barred by laches. We believe that in citing Schultheis for that rule, the Casey court implicitly reaffirmed the Schultheis court’s own statement of that rule. That statement is:

“In [Clark v. City of Chicago (1908), 233 Ill. 113, 84 N.E. 170,] we held that a member of the Chicago police force claiming to have been wrongfully removed would be barred by laches from his right to have the record of the civil service commissioners reviewed by certiorari if he delayed more than six months in beginning his suit unless the delay was satisfactorily explained by the petition for the writ.” (Schultheis, 240 Ill. at 170.)

In light of the foregoing statement of the rule in Schultheis, we find it is manifest from the Casey court’s restatement of the rule that it equated a six-month delay in bringing suits of this type as unreasonable per se and sufficient to constitute laches unless “a valid excuse therefor” was given.

The second reason why we must disagree with the Chriswell court that Casey rejected the six-month rule for bringing suits of this type is found in the passage from Casey which we have previously quoted and which culminates in the court’s agreement with the defendants therein that laches should be available to a public employer sued by a discharged employee. We believe that that passage evinces a clear, albeit implicit, adoption of the rationale underlying the six-month rule (see Kadon, 45 Ill. App. 2d 425, 195 N.E.2d 751; Sullivan, 133 Ill. App. 2d 218, 272 N.E.2d 755) and thus of the rule itself.

The Chriswell court further erred when, based on its misreading of Casey, it reasoned that the trial court in the case before it erred in denying recovery solely on the basis of the plaintiff’s delay in bringing suit because defendants had not shown that they were prejudiced by the delay. Specifically, it held that the mere assignment of work to another employee after the plaintiff’s termination was insufficient to show prejudice to the employer unless it proved that it would have acted differently had the plaintiff sought prompt reinstatement. It also held that, in that case, the defendants would have been injured by their own wrongful conduct rather than the plaintiff’s delay. Chriswell, 70 Ill. App. 3d at 326.

This reasoning of the Chriswell court was error for several reasons. First, as we have already shown, the Casey court adopted, rather than rejected, the six-month per se laches rule unless the delay was satisfactorily explained. Secondly, in so reasoning, the Chriswell court failed to realize that the Casey court found that rule inapplicable in the case before it for reasons which were not present in Chriswell and, indeed, are not present in the vast majority of cases of the instant type, including this case.

Specifically, the Casey court declined to apply the rule for the following reasons: (1) the discharge of the plaintiffs therein was not an isolated incident but, rather, in furtherance of a general policy involving numerous employees; (2) the defendants had no intention of reinstating any employee who was discharged pursuant to their mandatory-retirement program unless and until it was ruled invalid by the Illinois courts in a suit predating that of the Casey plaintiffs; (3) immediate action by the plaintiffs would have been futile since the defendants undoubtedly would have sought and received a delay pending the outcome in the prior litigation. (Casey, 69 Ill. 2d at 115-16,) Similarly, the court concluded that it was incumbent upon the defendant to come forward and demonstrate that the plaintiffs’ delay had “otherwise” prejudiced it or induced it to change its position for the reason that it had been understood by the parties that the prior litigation was a test case which directly controlled the plaintiffs’ claims and that the plaintiffs had intended to await the outcome of that litigation before bringing their actions. Casey, 69 Ill. 2d at 116.

It is clear from the foregoing that Casey is sui generis and of little value in cases, such as Chriswell and the instant one, where: (a) discharges of public employees are isolated incidents and not in furtherance of some general policy of the employer; and (b) the parties are not awaiting the outcome of prior litigation which would be controlling of a later suit against the same employer. It is of little value because, contrary to the Chriswell court’s understanding, it cannot categorically be said in such cases that the injury or prejudice to the public employer defendant therein results solely from his own wrongful conduct rather than the plaintiff’s delay. That being the case, the Chriswell court clearly erred in relying upon Casey to conclude: (a) that it is insufficient prejudice to a public employer that another employee had done what it would have to compensate the plaintiff for, if successful, without a showing that it would have acted differently had the plaintiff acted promptly; and (b) that, unless that showing is made, the defendant’s own wrongdoing would be the cause of its injury. In view of our analysis of Casey, we believe that Chriswell was wrongly decided and is of no support to plaintiff here.

In view of that analysis, we must also take issue with Fruhling v. County of Champaign (1981), 95 Ill. App. 3d 409, 420 N.E.2d 1066. Fruhling holds that the supreme court had never adopted the rationale of Sullivan that cases of reinstatement to public employment after a period of time are inherently prejudicial to the employer and that prejudice thus need not be specially proved in such cases. (Fruhling, 95 Ill. App. 3d at 417-18.) However, in so holding, the Fruhling court clearly failed to recognize the Casey court’s implicit adoption of the rationale for the six-month rule underlying Sullivan and Kadon. Fruhling also cites Casey for the “generally accepted rule” that defendants must demonstrate prejudice before laches will be applied. (Fruhling, 95 Ill. App. 3d at 418.) In so doing, the Fruhling court failed to recognize that the Casey defendants were required to demonstrate that they were “otherwise” prejudiced by the plaintiffs’ delay in seeking reinstatement, i.e., suffered prejudice beyond that inherent in that delay, solely for reasons neither present in Fruhling nor in most cases of this type, including the instant one.

In view of the fact that the Sheriff hired a replacement for plaintiff two months after he was terminated, plaintiff’s 15-month delay in seeking reinstatement and back pay was inherently prejudicial to the Sheriff and that prejudice was sufficient to warrant application of laches against plaintiff. The fact that the Sheriff did not hire plaintiff’s replacement in reliance upon plaintiff’s delay is immaterial.

Plaintiff lastly contends that laches is an equitable defense which, while applicable to his equitable claim for reinstatement to his former position, cannot be applied to the portion of his claim which is an action at law, i.e., his claim for back pay. (Mother Earth, Ltd. v. Strawberry Camel, Ltd. (1979), 72 Ill. App. 3d 37, 390 N.E.2d 393.) In this regard, plaintiff seeks to distinguish such actions at law as petitions for writs of mandamus and certiorari, to which laches has been held applicable (Schultheis, 240 Ill. 167, 88 N.E. 563; Casey, 69 Ill. 2d 108, 370 N.E.2d 499) on the ground that such actions do not involve monetary claims such as his for back pay and are thus more equitable than legal in nature.

We reject plaintiff’s analysis. Contrary to plaintiff’s assertion, it is not black letter law that laches is inapplicable to actions at law. Rather, it has been held that the doctrine is not strictly and unequivocally limited to suits in equity. (Bays v. Matthews (1982), 108 Ill. App. 3d 1112, 440 N.E.2d 142.) Moreover, in arguing that, unlike proceedings for the writs abovenoted, his action involves a monetary claim, plaintiff ignores that monetary claims for back pay are routinely brought as part of such proceedings. (See Casey, 69 Ill. 2d 108, 370 N.E.2d 499; Sullivan, 133 Ill. App. 2d .218, 272 N.E.2d 755; Chriswell, 70 Ill. App. 3d 320, 388 N.E.2d 175; People ex rel. Ballinger v. O’Connor (1957), 13 Ill. App. 2d 317, 142 N.E.2d 144.) Laches, being applicable to such proceedings notwithstanding the monetary claims made therein, is applicable to plaintiffs action in its entirety.

For all of the foregoing reasons, we affirm the order of the circuit court dismissing plaintiff’s first amended complaint with prejudice.

Affirmed.

CERDA, P.J., and WHITE, J., concur.

       Justice Freeman authored this opinion prior to his election to the Illinois Supreme Court.

      It was for these reasons that the court concluded that, if the plaintiffs recovered accrued back pay, the defendants would have been injured by their own wrongful conduct, which took the form of a wrongful retirement policy, not the plaintiffs’ delay.

      In so holding, we believe the Casey court implicitly recognized that the prejudice to a public employer inherent in a wrongful termination suit brought later than six months thereafter was, alone, insufficient to bar the suit in the case before it.


author: JUSTICE RIZZI

text:
    DOMINIC F. SHORTINO et al., Indiv. and on Behalf of All Those Similarly Situated, Plaintiffs-Appellees, v. ILLINOIS BELL TELEPHONE COMPANY, Defendant-Appellant (Business and Professional People for the Public Interest, Intervenors-Plaintiffs).
    First District (3rd Division)
    No. 1 — 88—1748
    Opinion filed December 5, 1990.
    —Rehearing denied January 15, 1991.

      Henry L. Mason III, Lisa A. Hausten, L. Bow Pritchett, and John C. Gockley, all of Chicago, for appellant.
    Sidney Z. Karasik, Leonard E. Handmacher, and Seymour Schriar, all of Chicago, for appellees.
   JUSTICE RIZZI

delivered the opinion of the court:

Defendant Illinois Bell Telephone Company (Illinois Bell), appeals from an order of the circuit court of Cook County which granted the motion of plaintiffs Dominic E Shortino and Valerie Johnson, individually and on behalf of all those similarly situated (plaintiffs), for a permanent injunction on count I of their three-count class action complaint. Illinois Bell also appeals from an order granting plaintiffs’ motion for summary judgment on the issue of damages as to count I. The summary judgment order created a Chicago class fund and ordered judgment in favor of the Chicago class and against Illinois Bell in the sum of $9,310,452.81. The order creating the class fund was later supplemented by an order which added $5,422,717 to the fund. Illinois Bell also appeals from the supplemental order. Counts II and III of the complaint are still before the trial court and are not a part of this appeal. We affirm.

Illinois Bell contends that (1) the trial court erred in ruling that Illinois Bell’s procedure of recovering the municipal message tax on gross receipts from pay phones by charging monthly billed customers was unjust and unreasonable; (2) the trial court erred in ruling that the “r” factor method of recovering the message tax expense from pay phone use was not a just and reasonable method; and that (3) Illinois Bell’s constitutional rights would be violated if it were not allowed to recover message tax expenses pursuant to the procedure it advocates.

Plaintiffs, residents of the City of Chicago, filed a three-count class action complaint against Illinois Bell on March 12, 1985. The plaintiffs were certified as a class representing Illinois Bell customers located or residing in Chicago who, during the five-year period before the filing of the complaint, were surcharged for the City of Chicago message tax, based on gross receipts from coin-operated pay phones, which were spread to or loaded onto their own telephone bills in addition to their proportionate share of the tax on their own telephone use. Count I of the complaint alleged that Illinois Bell’s revenues from pay phone customers are part of the gross receipts base upon which the Chicago message tax is imposed and that Illinois Bell has wrongfully contrived to free itself of the burden of that tax expense by the device of spreading the tax to monthly billed customers who routinely pay “additional charges” for the tax. The plaintiffs further alleged that “in effect all of Bell’s Chicago customers, except its pay phone users, are required to pay an extra and illegal additional charge of the Municipal Utility Tax (MUT) to compensate Bell for what it fails to recover from its pay phone users.”

In 1955, the Illinois legislature enacted a law which authorized municipalities to impose on utilities, at a rate not to exceed 5% of their gross receipts from local operation, a municipal occupation tax. For the telephone companies, the base of the tax is the gross receipts of such business originating within the corporate limits of the taxing municipality. (Ill. Rev. Stat. 1987, ch. 24, par. 8 — 11—2(1).) The City of Chicago subsequently adopted the Chicago message tax ordinance, which parallels the State statute and currently charges a tax rate of 5%. (Chicago Municipal Code §132 — 31 (1986).) At the same time, the Illinois legislature adopted an amendment to the Public Utilities Act (PUA), which permitted public utilities to recover through an additional charge to be shown separately on the utility bill to each customer any occupation tax imposed by a municipality. Ill. Rev. Stat. 1987, ch. 111½, par. 9-221.

The PUA provides in pertinent part:

“The additional charge authorized by Section 9 — 221 or Section 9 — 222 shall be made (i) in the case of a tax measured by gross receipts or gross revenue, by adding to the customer’s bill a uniform percentage to those amounts payable by the customer for intrastate utility service which are includible in the measure of such tax, except, however, such method is not required where practical considerations justify a utility’s use of another just and reasonable method of recovering its entire liability for such tax ***.” (Emphasis added.) Ill. Rev. Stat. 1987, ch. lll2/a, par. 9-222.2.

Prior to recodification of PUA section 36(c) as section 9 — 222.2, effective January 1,1986, this section of the Act provided:

“(c) The additional charge authorized by paragraph (a) or paragraph (b) shall be made in the case of a tax measured by gross receipts or gross revenue by adding to the customer’s bill a uniform percentage to those amounts payable by the customer for intrastate utility service which are includable in the measure of such tax, except, however, such method is not required where practical considerations justify a utility’s use of another just and reasonable method of recovering its entire liability for such tax. This paragraph is not intended to make any change in the meaning of this Section, but is intended to remove possible ambiguities, thereby confirming the intent of paragraphs (a) and (b) as they existed prior to the effective date of this amendatory Act of 1985.” (Emphasis added.) (Pub. Act 84— 126, eff. July 1,1985.)

The above-emphasized portions of section 36(c) and section 9 — 222.2 were added to the PUA shortly after the filing of and presumably in response to the present case. The parties disagree as to the legislative intent behind both the emphasized amendment and the later deletion of the last sentence of former PUA section 36(c) when it was recodified as section 9 — 222.2.

In 1984, the Illinois Commerce Commission (ICC) instituted an investigative procedure to reconsider the propriety of Illinois Bell’s practice of spreading the municipal message tax expense through the use of the “r” factor. The trial court noted that the ICC held no hearings into the past or present use of the “r” factor before rendering its decision. In its order of May 13, 1987, the ICC found that telephone companies face “practical difficulties” in recovering their tax liability from “sent-paid” coin and “sent-collect” calls. The ICC then ruled that the use of spreading to recover utility taxes “was and is clearly permissible.” The ICC order provided:

“Since 1955, in accordance with procedures approved by the Commission, most major utilities, ‘targeted’ the amount of additional charges *** by imposing those *** charges on customers whose receipts give rise to the utility tax liability being collected. Specifically, the utility recovers from each customer the exact amount of the utility’s actual tax liabilities resulting from the taxable gross receipt received from that customer. Since 1955, in accordance with procedures approved by the Commission, telephone utilities have ‘spread’ the amount of additional charges *** Unlike gas and electric utilities, telephone utilities have a difference between their additional charge base and their tax base. Telephone utilities face practical difficulties in recovering their tax liability from sent-paid and sent-collect messages ***.
If there was any question that the Commission was erroneously construing the legislative intent by approving both a ‘traced’ *** and a ‘spread’ methodology, all uncertainty was resolved by subsequent legislative enactments. Public Act 81— 126 added Section 36(c) to the old Act ***. Corresponding Section 9 — 222.2 of the [new Act] contains the same provision regarding ‘a utility’s use of another just and reasonable method of recovering its entire liability for such tax. The use of both the ‘traced’ or ‘targeted’ and the ‘spread’ methodology was and is clearly permissible. Moreover, since the propriety of their use is ascertainable on its face from the language of the old Act and new Public Utilities Act, any additional proceedings are unnecessary as the outcome is predetermined as a matter of law.” (Emphasis added.) ICC Investigative Proceeding No. 84— 0082, May 13,1987.

The trial court chose to disregard the ICG’s validation of Illinois Bell’s spreading methodology and found instead that section 9 — 222.2 of the PUA does not authorize Illinois Bell’s continuous practice of spreading. The trial court found that section 9 — 222.2 does not by its terms sanction spreading, and that the method of spreading adopted by Illinois Bell is not “just and reasonable” because it discriminates against monthly billed customers without demonstrating any tangible difference or quid pro quo justifying charging monthly billed customers the municipal taxes generated by coin telephone users.

On September 9, 1986, the trial court granted plaintiffs’ motion for summary judgment on the issue of liability as to count I of their complaint. On November 12, 1986, the trial court granted plaintiffs’ motion for summary judgment on count I of their complaint on the issue of damages and created a Chicago class fund in the amount of $9,310,452.81. On May 11, 1988, the trial court granted plaintiffs’ motion for permanent injunction enjoining Illinois Bell from its billing practice of “spreading,” i.e., passing through to its monthly billed customers Bell’s liability and expense for the Chicago message tax which Bell does not recover from its coin pay customers. On May 20, 1988, the trial court entered an order supplementing the class fund by an additional $5,422,717.

On appeal, Illinois Bell first contends that the trial court erred in ruling that its procedure of charging monthly billed customers to recover the municipal message tax on gross receipts from pay phone use was unjust and unreasonable. We disagree.

The plaintiffs’ complaint alleged that the revenues from pay phone customers are part of the “gross receipts” base upon which the Chicago message tax is imposed and that Illinois Bell improperly charges the expense from such taxes to monthly billed customers in addition to their own proportionate share of the tax. Plaintiffs contend that monthly billed customers should pay only their fair and just proportional share of the tax. Plaintiffs further allege that Illinois Bell’s practice of spreading the message tax expense, which it does not collect from pay phone users, to billed customers violates the PUA’s prohibition against discrimination. (Ill. Rev. Stat. 1987, ch. lll2/s, par. 9 — 241.) The plaintiffs further contend that the amendment to section 9 — 222.2 of the PUA does not expressly describe, or even recognize by implication, “spreading” as one of the “practical” exceptions to a utility’s generic duty to trace or target its municipal utility tax liability by a uniform percentage to all of its customers in a service area subject to a MUT. Plaintiffs therefore conclude that spreading is prima facie discriminatory because it benefits one class of Illinois Bell customers (coin pay phone users) at the expense of another class (monthly billed customers).

Illinois Bell responds that the first clause of section 9 — 222.2 expressly authorizes the “tracing” method used by gas and electric companies. It further contends that the second clause, which allows a just and reasonable alternative to tracing, authorizes the use of spreading to recover message tax expenses which cannot be recovered from the customer whose utilization of telephone services gave rise to the revenue subject to the tax. Bell also posits that its interpretation of section 9 — 222.2 does not conflict with the PUA’s prohibition against discrimination because both sections require rates and charges that are just and reasonable. Bell further believes that because the “r” factor method used to calculate the additional charges has the precise effect of limiting recovery of message tax expense to residents of the taxing municipality, the “r” factor method is a far more equitable method of recovery than statewide spreading because the benefit of the utility tax and the municipal services it helps to provide are enjoyed by the residents of the taxing municipalities.

The pertinent language of former section 36(c) and current section 9 — 222.2 of the PUA is “such method is not required where practical considerations justify a utility’s use of another just and reasonable method of recovering its entire liability for such tax.” (Ill. Rev. Stat. 1987, ch. lll2/3, par. 9 — 222.2.) It is clear that the language used by the legislature does not expressly authorize the use of spreading. Unfortunately, the legislative histories of the two enactments do not reveal the intent of the legislature in adopting the language that it used. Our interpretation of the statute, therefore, must be limited to the plain meaning of the language that was adopted.

The phrase “just and reasonable” is a standard phrase of art in public utility regulation. It has been used frequently and therefore judicially construed often in the context of utility rate regulation. The statutory language that rates and charges made by a public utility shall be “just and reasonable” has remained unchanged since the enactment of the Public Utilities Act in 1913. (Union Electric Co. v. Illinois Commerce Comm’n (1979), 77 Ill. 2d 364, 372, 396 N.E.2d 510, 514.) In the area of rate regulation, the Illinois Supreme Court has construed the term “just and reasonable” to mean a reasonable return on the basis of the fair value of the utility property. (Union Electric Co., 11 Ill. 2d at 369; City of Chicago v. Illinois Commerce Comm’n (1966), 34 Ill. 2d 49, 50-51, 213 N.E.2d 550, 551-52; Du Page Utility Co. v. Illinois Commerce Comm’n (1971), 47 Ill. 2d 550, 553, 267 N.E.2d 662, 664.) The concept of fair value holds that it is the value of the utility’s property devoted to public service upon which the reasonable rate must be returned. Union Electric Co., 11 Ill. 2d at 369.

Here, we are not concerned with a just and reasonable method for determining rates, but rather, a just and reasonable method of recovering a utility’s tax liability. There is no Illinois case which has specifically addressed this issue. The only support for Illinois Bell’s contention that the use of spreading is a just and reasonable method of recovering the MUT is the ICC’s order. A reviewing court, however, is not bound by the Commission’s order if it concludes that the findings of the Commission are not supported by substantial evidence based on the entire record of evidence presented to the Commission to support the Commission’s findings. (See General Mills, Inc. v. Elinois Commerce Comm’n (1990), 201 Ill. App. 3d 715, 720, 559 N.E.2d 225; Ill. Rev. Stat. 1987, ch. lll2/3, par. 10-201(e)(iv)(A).) Because we conclude that the findings of the ICC order are not supported by substantial evidence based on the entire record of evidence presented to the ICC to support its findings, we are not controlled by and do not follow the order of the ICC.

Further, we find that an examination of the plain language of Section 9 — 222.2 of the PUA reveals that tracing and not spreading is the preferred method for recovering the utility’s MUT liability. The statute clearly provides:

“The additional charge *** shall be made *** by adding to the customer’s bill a uniform percentage to those amounts payable by the customer for intrastate utility service which are includible in the measure of such tax ***.” (Ill. Rev. Stat. 1987, ch. lll2/3, par. 9 — 222.2.)

It is clear from the language of the statute that the legislature intended that, in the first instance, the utility would recover its MUT liability by adding to the customer’s bill a uniform percentage reflecting the tax liability on the services charged to that customer. The second clause provides that tracing is not required where practical considerations justify another just and reasonable method of recovering the utility’s entire liability for the tax. This language cannot be construed to authorize the shifting of this tax burden from the consumer of the services to another party who did not utilize the services which gave rise to the tax. It would, however, be just and reasonable to include the tax burden within the pay phone charge or adopt any other just and reasonable method of collecting from the consumers of the telephone services a uniform percentage of the tax charged on their telephone use.

Additionally, section 9 — 241 of the PUA prohibits unreasonable differences in charges between customers or classes of customers. (Ill. Rev. Stat. 1987, ch. lll2/3, par. 9 — 241; City of St. Charles v. Illinois Commerce Comm’n (1961), 21 Ill. 2d 259, 264, 172 N.E.2d 353, 355-56.) Plainly, the shifting of pay phone users’ tax burden onto monthly billed customers discriminates against billed customers in violation of section 9 — 241 of the PUA. It follows that spreading is not a just and reasonable alternative to tracing. The fact that Illinois Bell has found it inconvenient to collect the MUT from pay phone customers does not make it just and reasonable to overload monthly billed customers. We therefore conclude that the trial court did not err in finding that Illinois Bell’s policy of spreading the MUT liability from pay phone users onto monthly billed customers was unjust, unreasonable and discriminatory.

Illinois Bell next contends that the trial court erred in ruling that the “r” factor method was not the most just and reasonable method for recovering the message tax expense from pay phone use. We disagree with defendant’s contention.

In the trial court’s findings of fact it found that for more than 30 years, Illinois Bell has recovered its Chicago message tax expense by charging each of its monthly billed customers in the city a surcharge reflecting both the message tax expense resulting from the customer’s billed intrastate service and the statutorily authorized administrative charge. The surcharge has also included an additional sum to recover the Chicago message tax expense imposed on Illinois Bell’s coin pay telephone revenues which Hlinois Bell does not collect from its coin pay telephone users. The trial court further found that the method of overcharging monthly billed customers to recover the coin pay telephone message tax expense from monthly billed customers is known as “spreading.” The amount “spread” to each monthly billed customer is determined by using a mathematical formula known as the “r” factor.

The “r” factor formula is a ratio or percentage which is applied uniformly to monthly customer bills. The applicable percentage is determined by dividing the total amount of revenue subject to the tax (the tax base) into the amount of billed revenue to which the additional charge is to be applied (the additional charge base) and then dividing the tax rate (5%) by the resulting decimal. The “r” factor percentage is then applied uniformly to monthly bills for intrastate telephone service.

The trial court found that the “r” factor method “spreads” to the monthly billed customer residing in Chicago the Chicago message tax liability not recovered from coin pay telephone users. The trial court found that this results in overcharging the monthly billed customer. In making its finding, the trial court noted that Illinois Bell’s expert acknowledged that the “r” factor formula and Illinois Bell’s practice of spreading have never been specifically authorized by the PUA.

Under the circumstances, we agree with the trial court that although the “r” factor is uniformly applied to all monthly billed customers, the inclusion in the additional charge base of the revenue from pay phone use results in a formula which improperly overcharges monthly billed customers. The method is therefore unjust and unreasonable. We therefore conclude that the trial court did not err in ruling that the “r” factor method was not a just and reasonable method for recovering the message tax expense from pay phone use.

Finally, Illinois Bell contends that its constitutional rights would be violated if it were not allowed to recover message tax expenses in the manner that it advocates. Illinois Bell posits that if section 9 — 241 is held to prohibit spreading, it will be left with a purely illusory right to pass on its tax liability which cannot be exercised. We disagree.

Our decision in no way impairs Illinois Bell’s right to pass its municipal tax liability on to its customers. Illinois Bell may collect all or part of its tax liability by adding to customer bills .an additional charge representing a uniform percentage of the tax liability on the customers’ intrastate telephone usage. Illinois Bell, however, is not authorized to.shift the burden of the tax liability from one group of customers to another. To do so would impermissibly violate the PUA by establishing an unreasonable difference in charges made to monthly billed and pay phone customers.

Accordingly, the orders entered in the circuit court are affirmed.

Affirmed.

CERDA, P.J., and WHITE, J., concur.


text:
    BRIAN McDONAGH, S.C., et al., Plaintiffs-Appellants, v. DEBRA MOSS, Defendant-Appellee.
    First District (3rd Division)
    Nos. 1 — 89—2362,1—89—2425 cons.
    Opinion filed December 5, 1990.

      Wildman, Harrold, Allen & Dixon, of Chicago (Robert E. Kehoe, Jr., and M. Jayne Rizzo, of counsel), for appellants.
    James K. Toohey and Daniel P. Hogan, of Chicago, for appellee.
   JUSTICE RIZZI

delivered the opinion of the court:

Plaintiffs, Brian McDonagh and Vein Clinics of America, Inc., brought an action against defendant, Debra Moss, M.D., for breach of a covenant not to compete in a specified type of medical practice. The covenant not to compete was part of a written contractual agreement (Agreement) between the parties. Plaintiffs moved for a preliminary injunction to enjoin the defendant from engaging in a competing medical practice in violation of the covenant not to compete. While the plaintiffs’ motion for a preliminary injunction was pending, defendant moved to strike the prayer for equitable relief in the complaint because the covenant not to compete expressly provided for liquidated damages for a breach. The trial court concluded that plaintiffs’ exclusive remedy for a breach of the covenant not to compete is liquidated damages and, therefore, entered an order granting defendant’s motion to strike the prayer for equitable relief and denying plaintiffs’ motion for á preliminary injunction. We reverse and remand for further proceedings in the trial court, including a hearing on the merits with respect to plaintiffs’ motion for a preliminary injunction.

The plaintiffs are two related corporations providing for specialized medical services under the auspices and direction of Dr. Brian Mc-Donagh. Defendant, a physician, joined the plaintiffs’ specialized practice pursuant to the Agreement executed between the parties.

Section 12 of the Agreement provides that for four years after termination of the Agreement, the defendant would not enter into a competing related medical practice within a 50-mile radius of any of the plaintiffs’ offices. Section 12.2 provides for liquidated damages if the defendant breached the covenant not to compete. The entire text of this portion of the Agreement is as follows:

“12.2 Remedy. S.C. [plaintiff and Independent Contractor [defendant] acknowledge that it is difficult to compute the amount of loss or damages plaintiffs will sustain if defendant breaches her covenant under, this Section 12. Plaintiff and defendant agree that the measure hereinafter provided represents the product of their good faith negotiations. Accordingly, if defendant breaches her covenant under this Section 12, defendant agrees to pay plaintiff, as liquidated damages under this Agreement, the greatest of the following: (i) her gross income from her use of injection compression sclerophleboplasty during the 12 month period beginning with the first such use computed on the accrual basis method of accounting; (ii) an amount equal to plaintiff’s gross receipts from defendant’s services hereunder during the 24 months immediately preceding the date of termination (or her breach, if earlier); or (iii) the rate of defendant’s Annual Fee in effect on the date of termination. The first $95,000 of such amount shall be payable as of the first day on which defendant breaches such covenant; the balance, if any, shall be payable on the first anniversary of the date of termination. If not paid when due, any amount payable hereunder shall bear interest at two percent (2%) above the floating prime rate of interest charged by The First National Bank of Chicago. If plaintiff is involved in a court proceeding to enforce the covenants contained in this Section 12, then in the event plaintiff prevails in such litigation, defendant shall be liable for the payment of reasonable attorneys’ fees, court costs and ancillary expenses incurred by plaintiff in enforcing its rights hereunder, and in the event defendant prevails in such litigation, plaintiff shall be liable for the payment of reasonable attorneys’ fees, court costs and ancillary expenses incurred by defendant in connection with such litigation. In the event the provisions of this Section 12 should be deemed to exceed the limitations permitted by law, then this Section 12 shall be modified to include the maximum restrictions permitted by law.”

The complaint alleges that defendant terminated the Agreement without the requisite 90 days’ notice and that, in violation of the Agreement, she has started a competing specialized type of medical practice within the proscribed 50-mile radius.

In reviewing this case, we start with the premise that a provision for liquidated damages in the event of a breach does not in itself make specific performance of the Agreement unavailable as a remedy. (Bauer v. Sawyer (1956), 8 Ill. 2d 351, 134 N.E.2d 329.) Such a provision for liquidated damages, absent a clear contrary showing, is merely an added security in the event of a breach, and not a loophole of escape from performance. (See Restatement (Second) of Contracts §361 (1981); 5A A. Corbin, Corbin on Contracts §1213 (1964).) Here, there is no clear showing that the provision for liquidated damages in section 12.2 of the Agreement was intended to preclude injunctive relief in the event of a breach. If the parties had intended that the provision for liquidated damages precluded injunctive relief, they could have included explicit language to that effect in the Agreement, or they could have included explicit language that the liquidated damages were to be the solé remedy in the event of a breach.

Defendant contends that “viewing the Agreement in its entirety,” the plaintiffs “intended the monetary damages specified in section 12 to constitute their exclusive remedy for any breach of that provision.” Defendant refers to section 10.2 and section 13 of the Agreement to support her contention.

Section 10.2 provides:

“Offsets. In addition to all other remedies available to plaintiff, defendant and plaintiff agree that upon the termination of this relationship for any reason, plaintiff shall have the right to offset any amounts payable from plaintiff to defendant against any amount owed to plaintiff by defendant.”

Section 13 of the Agreement makes it improper for defendant to “use, sell, offer for sale, divulge or solicit the sale” of certain proprietary or confidential information. Section 13.2 provides that if the defendant “breaches her covenant under this Section 13, defendant agrees that in any suit which may be brought by plaintiff in any court having jurisdiction, an order may be entered enjoining her from breaching such covenant, and an order to that effect shall be entered pending the litigation, as well as a final determination thereof, without the requirement to post bond, and that such application for such injunction shall be without prejudice to any other right of action which accrues to plaintiff by reason of the breach of the foregoing provisions.” Defendant argues that because sections 10.2 and 13 of the Agreement provide for relief in addition to the liquidated damages stated in section 12, the parties intended that the defendant be allowed to breach the covenant not to compete in section 12 on a continuing basis without court intervention so long as defendant pays the liquidated damages. In other words, defendant argues that the parties intended that performance of the covenant not to compete could not be enforced. We disagree.

In reviewing the Agreement in its entirety, we conclude that sections 10.2 and 13.2 do not demonstrate that the parties intended that the liquidated damages provision of section 12.2 is to be an exclusive remedy thereby precluding injunctive relief. In order to be a complete bar to equitable relief, there must be clear language-in an agreement that the liquidated damages are to be the sole remedy in the event of a breach. (See Coney v. Commercial National Realty Co. (1980), 88 Ill. App. 3d 1026, 1028, 410 N.E.2d 1181, 1182.) Here, whether the Agreement is read seriatim or as a whole, there is no such clear language in the Agreement.

Defendant also contends that because section 12 of the Agreement does not expressly provide for injunctive relief in the event of a breach, the parties did not intend to allow for injunctive relief. We reject this contention outright. Parties to an agreement are not required to state in the agreement all of the remedies which the law gives them and which they may seek, and merely because they specifically provide for a certain remedy does not preclude other remedies available to them under the law in the event of a breach.

Under the circumstances, we conclude that the liquidated damages provision in section 12.2 of the Agreement is not an exclusive remedy which precludes the plaintiffs from obtaining equitable relief in the event of a breach. The trial court therefore erred in granting defendant’s motion to strike the prayer for equitable relief and denying plaintiffs’ motion for preliminary injunction without a hearing on the merits.

The order entered by the trial court is reversed, and the case is remanded for further proceedings, including a hearing on the merits with respect to plaintiffs’ motion for a preliminary injunction.

Reversed and remanded.

CERDA, P.J., and WHITE, J., concur.


author: JUSTICE STEIGMANN

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. RAYMOND M. BURG, Defendant-Appellant.
    Fourth District
    No. 4 — 90—0154
    Opinion filed December 31, 1990.

      Richard D. Frazier and D. Peter Wise, both of Metnick, Barewin & Wise, of Springfield, for appellant.
    Donald M. Cadagin, State’s Attorney, of Springfield (Kenneth R. Boyle, Robert J. Biderman, and Dale M. Wood, all of State’s Attorneys Appellate Prosecutor’s Office, of counsel), for the People.
   JUSTICE STEIGMANN

delivered the opinion of the court:

Defendant, Raymond Burg, was convicted of armed robbery (Ill. Rev. Stat. 1989, ch. 38, par. 18 — 2) and sentenced to seven years’ imprisonment. On appeal, defendant argues that he was denied effective assistance of counsel because his trial attorney failed to object to a jury instruction he claims de-emphasized the lesser included offense of robbery. Because the instruction in question was proper, we affirm.

On April 27, 1990, defendant entered a grocery store, removed a package of candy from the shelf, and proceeded to a check-out aisle. Defendant handed the checker a bag and demanded that he “put the money in the bag.” Defendant was holding a gun, but it was covered with a newspaper such that only one to two inches of the barrel could be seen. The checker handed defendant the money from the cash register and defendant fled. Both the checker and a customer later identified defendant as the holdup man from a collection of photographs. At trial, defendant denied committing the robbery.

Illinois Pattern Jury Instructions, Criminal, No. 26.01Q (2d ed. Supp. 1989) (hereinafter IPI Criminal 2d Supp.) was given to the jury and stated as follows:

“When you retire to the jury room you first will elect one of your members as your foreperson. He or she will preside during your deliberations on your verdict.
Your agreement on a verdict must be unanimous. Your verdict must be in writing and signed by all of you, including your foreperson.
The defendant is charged with the offense of Armed Robbery. Under the law, a person charged with Armed Robbery may be found not guilty, or may be found guilty of Armed Robbery or guilty of Robbery.
You are to decide based upon the evidence and the law in this case whether to return a verdict of not guilty, a verdict of guilty of Armed Robbery, or a verdict of guilty of Robbery.
Accordingly, you will be provided with three verdict forms: ‘not guilty’, ‘guilty of Armed Robbery’, and ‘guilty of Robbery’.
From those three verdict forms, you should select the one verdict form that reflects your verdict and sign it as I have stated. Do not write on the other two verdict forms. Sign only one of these verdict forms.
If you find the State has proved the defendant guilty of both Armed Robbery and Robbery, you should select the verdict form finding the defendant guilty of Armed Robbery and sign it as I have stated. Under these circumstances, do not sign the verdict form finding the defendant guilty of Robbery.” (Emphasis added.) See IPI Criminal 2d Supp. No. 26.01Q, at 367-68.

Following deliberations, the jury returned a guilty verdict for the offense of armed robbery.

Defendant argues that the last paragraph of this instruction “deemphasized the importance of the lesser charge” of robbery. He claims that the instruction tells the jury that if it cannot agree as to whether defendant committed the greater or lesser offense, defendant should be convicted of the greater offense. We are unpersuaded.

The Illinois Supreme Court Committee on Pattern Jury Instructions in Criminal Cases explains in its introductory note to chapter 26.00 of IPI Criminal 2d Supp. the purpose of the italicized paragraph in instruction No. 26.01Q. That explanation reads as follows:

“The Committee is aware of instances where a confused jury has returned logically or legally inconsistent verdicts. (For examples of problems the Committee is seeking to avoid, see People v. Hoffer, 106 Ill. 2d 186, 478 N.E.2d 335, 88 El. Dec. 20 (1985) (guilty of murder, voluntary manslaughter, and involuntary manslaughter); People v. Spears, 130 Ill. App. 3d 1006, 475 N.E.2d 8, 86 Ill. Dec. 202 (3d Dist. 1985) (guilty of attempt murder, armed violence, and reckless conduct); People v. Coleman, 131 Ill. App. 3d 76, 475 N.E.2d 565, 86 El. Dec. 351 (1st Dist. 1985) (guilty of attempt murder and reckless conduct).) To avoid such confusion in future cases, the Committee has expanded these concluding instructions to be given to the jury and has made them more specific depending upon the particular charges to be considered by the jury and the relationship of those charges to each other.” IPI Criminal 2d Supp. No. 26.00, Introductory Note, at 317.

A defendant is entitled to have the jury instructed on a lesser offense that is included in the greater offense with which he is charged. (People v. Bryant (1986), 113 Ill. 2d 497, 502, 499 N.E.2d 413, 415; see also Beck v. Alabama (1980), 447 U.S. 625, 636-37, 65 L. Ed. 2d 392, 401-02, 100 S. Ct. 2382, 2388-89.) Defendant in this case was entitled to have his jury instructed on the three options available to it under the law: not guilty, guilty of the less serious offense (robbery), or guilty of the more serious offense (armed robbery). (See Bryant, 113 Ill. 2d at 502, 499 N.E.2d at 415.) In the present case, defendant’s jury was properly instructed as to all these available options.

Defendant claims that the instructions made it unnecessary for the jury to decide whether the defendant possessed a gun. We disagree. The jury was given IPI Criminal 2d Nos. 14.01 (definition of armed robbery), No. 14.02 (issues in armed robbery), No. 14.03 (definition of robbery), and No. 14.04 (issues in robbery) (1981). Therefore, the gun possession issue was before the jury and they were fully instructed as to the options available.

Defendant argues further that IPI Criminal 2d Supp. No. 26.01Q would allow the jury to convict him for the greater offense “even if some members of the jury believe that he was only guilty of the lesser offense.” In support of this argument he cites People v. Summers (1990), 202 Ill. App. 3d 1, 14, 559 N.E.2d 1133, 1141. However, we find defendant’s reliance on Summers inapplicable to the present case because Summers was concerned with greater and lesser offenses (first degree murder and involuntary manslaughter) that have mutually inconsistent mental states (intentional or knowing acts for first degree murder, as opposed to reckless acts for involuntary manslaughter). In the present case, conflicting mental states do not exist between armed robbery and robbery. Further, this jury was clearly told by instruction No. 26.01Q that its verdict must be unanimous, and no construction to the contrary of that instruction makes sense.

Defendant cites the decision of this court in People v. Whitelow (1987), 162 Ill. App. 3d 626, 515 N.E.2d 1327, as support for his position, but we find Whitelow to be inapposite. In Whitelow, this court specifically approved of jury instructions designed to avoid legally inconsistent verdicts, such as instruction No. 26.01Q in the present case, but cautioned that such instructions should not take away the jury’s necessary choice by de-emphasizing the importance of offenses with lesser penalties. (Whitelow, 162 Ill. App. 3d at 631, 515 N.E.2d at 1330-31.) However, our concern was primarily based upon the use in the instructions in Whitelow of the terms “greater” and “lesser.” We note with approval that instruction No. 26.01Q and all of the instructions in the 26.01 series of IPI Criminal 2d Supp. avoid the use of those terms.

Although the evidence may support a conviction on both charges, when there is but one act, there can be but one conviction. (People v. Jones (1985), 105 Ill. 2d 342, 359, 475 N.E.2d 832, 840; People v. Paden (1984), 123 Ill. App. 3d 514, 521, 462 N.E.2d 989, 994.) If multiple convictions are returned, the defendant should be sentenced only for the most serious offense. (People v. Pitsonbarger (1990), 142 Ill. 2d 353; People v. Mack (1984), 105 Ill. 2d 103, 137, 473 N.E.2d 880, 898.) Had the jury in this case been permitted to return verdicts finding defendant guilty of both armed robbery and robbery, based upon this authority, defendant would be appropriately sentenced for his armed robbery conviction. Under these circumstances, we fail to see what possible prejudice defendant suffered by having a jury that has found him guilty of armed robbery return only that verdict instead of both a guilty of armed robbery verdict and a guilty of robbery verdict.

Because the instructions given were not erroneous, counsel’s failure to object to them does not amount to ineffective assistance of counsel.

Affirmed.

GREEN and KNECHT, JJ., concur.