author: MR. JUSTICE UNDERWOOD MR. JUSTICE CLARK,

text:
    (No. 49022.

      In re LOUIS M. MARCH, Attorney, Respondent.

      Opinion filed April 3, 1978.

    Rehearing denied May 26, 1978.

      CLARK, J. dissenting.
    John C. O’Malley, of Chicago, for the Administrator of the Attorney Registration and Disciplinary Commission.
    Louis M. March, of Chicago, pro se.

   MR. JUSTICE UNDERWOOD

delivered the opinion of the court:

Pursuant to the directions from the Inquiry Board of the Attorney Registration and Disciplinary Commission, the Administrator of the Commission filed a 9-count complaint charging unprofessional conduct on the part of the respondent, Louis M. March, who was licensed to practice law in this State in 1937 and maintains an office in Chicago. At the conclusion of hearings on the complaint the Hearing Board found that counts I, II and VIII had not been proved by clear and convincing evidence and that only a part of the misconduct alleged in count III had been established. The proof offered in support of counts IV, V, VI, VII and IX, however, was found to establish unprofessional and unethical conduct by respondent tending to bring the legal profession into disrepute. Suspension from practice for 3 years was recommended as to each of counts III, IV, V, VII and IX and disbarment as to count VI. It was also recommended that as counts III, IV, V, VI and VII “collectively show a continuing standard of conduct on the part of respondent, we conclude that he is unfit to practice law and respondent should be disbarred.”

Respondent filed with the Review Board his exceptions to the findings and conclusions of the Hearing Board. Those findings and conclusions were affirmed by the Review Board, which has filed with this court its report recommending respondent’s disbarment. The case is before us on respondent’s exceptions to that report and oral argument by the parties.

It is alleged in count III that, in addition to representing her in several legal actions, respondent represented to Leocadia Borkowski that he was a financial advisor and an expert in the stock market; that as a result of such representations Mrs. Borkowski entrusted respondent with funds to invest on her behalf which respondent failed to do and for which he has failed to give Mrs. Borkowski an accounting; that his conduct constituted misrepresentation, fraud, deceit, dishonesty, gross overreaching, abuse of the attorney-client privilege and conversion of funds. The Hearing Board concluded that it had not been proved by clear and convincing evidence that respondent’s conduct involved misrepresentation, fraud, deceit or dishonesty or that respondent had converted funds to his own use. It did find, however, that respondent’s conduct with respect to the investing of Leocadia Borkowski’s funds constituted a gross overreaching and an abuse of the attorney-client relationship violating two provisions of the Code of Professional Responsibility. Illinois Code of Professional Responsibility, as approved by the Illinois State Bar Association (rev. 1977), Disciplinary Rule 5—104(A) (conflict of interest) and Disciplinary Rule 9—102(B) (failure to account).

At the outset of the hearing before the Hearing Board, respondent moved to dismiss the complaint against him, citing the fifth and fourteenth amendments to the Federal Constitution and section 10 of article I of the Illinois Constitution. When that motion was denied the Administrator sought to call respondent as an adverse witness for cross-examination under section 60 of the Civil Practice Act (Ill. Rev. Stat. 1975, ch. 110, par. 60). Respondent objected, again asserting the constitutional protections against self-incrimination. The chairman of the hearing panel indicated the panel’s view that the fifth amendment and the corresponding provisions of the Illinois Constitution protected respondent from testifying to incriminating facts but were not a basis for dismissing the complaint. After respondent indicated his intention to refuse, on these grounds, to answer any questions relating to any of the complainants, respondent was excused.

Thereafter, proof was introduced through a number of building and loan, bank and brokerage firm employees or officers called to identify various cashier’s checks, drafts and stock certificates representing funds apparently given by Mrs. Borkowski to respondent to invest for her. A stockbroker with whom respondent dealt at the brokerage house of Paine, Webber, Jackson and Curtis, Inc., testified he first met respondent when the latter walked in one afternoon, started talking about the stock market, and proposed that the witness let respondent handle the witness’ personal account, the respondent to receive a percentage of any profits he made for the witness. There are in evidence forms signed by Leocadia Borkowski authorizing respondent to buy and sell securities on her behalf, and it is clear that he did so in substantial amounts. Respondent decided what stocks to buy and when to do so. Those he purchased were highly speculative, a fact which disturbed the Paine, Webber firm, which was aware that Mrs. Borkowski was a widow. The firm both wrote and called her, informing her of the speculative nature of the stocks in her account. She indicated she understood this, wished to purchase them, and desired respondent to handle her account. By 1973 her relationship with him had deteriorated to the point where she filed a written complaint with the Commission, indicating she was without funds and unable to secure an accounting from respondent. In mid-1975 she notified the Commission that she wished to withdraw her complaint against respondent, and she refused, on fifth amendment grounds, to testify in the disciplinary proceedings.

Despite the rather substantial volume of testimonial and documentary evidence relating to the Borkowski matter, we do not believe that any portion of the misconduct alleged in count III can be said to have been proved by clear and convincing evidence.

Counts IV and V concern respondent’s dealings as a “financial advisor” to Irving Gold, an assistant director of the municipal division of the circuit court of Cook County. That complaint did not involve an attorney-client relationship. Gold was, however, aware that respondent March was an attorney when they happened to meet on several occasions at a cafeteria in the Richard J. Daley Center. During such chance meetings, the discussion often centered upon the stock market, with March indicating to Gold that he was an expert in the market.

On June 10, 1968, after several such meetings, Gold and March entered into a written agreement whereby, in consideration of his experience in the buying and selling of stocks, March was to “select stocks for purchase and sale by Irving Gold in his account for a period of three years.” In exchange, March was to receive 15% of any gains resulting from such purchases and would not be liable for any losses or expenses. All expenses of March were to be taken into account when an accounting was made between the parties. March was given the “sole discretion to determine when the stock *** shall be sold during said term, and accounting to be made after each sale of stock.” Based upon March’s representations as to the company’s potential, the agreement also provided that March’s first transaction would be to buy approximately 1,000 shares of common stock in Western Land Corporation in Gold’s name for a purchase price of $2,500.

During subsequent encounters throughout 1968-70, March continued to assure Gold that the stock was increasing in value and represented the price to be from $2 to $5 per share. The market value did, in fact, range from $1 to $1.50 during this period. Accompanying such false assurances, March continued to solicit funds for the purchase of Western Land stock, and on two separate occasions Gold forwarded March $2,500 and $750 respectively to purchase additional Western Land stock. The $750 transaction was concluded by a written agreement, dated January 2, 1969, by which 30% of those shares purchased for Gold were assigned to March and which entitled March to 30% of the profits derived from this stock. March failed to disclose to Gold that March’s wife owned stock in Western Land, even though part of the stock purchased by March for Gold at $2.50 per share was purchased from respondent’s wife when the market value was substantially below that level.

In 1971, as the term of the original March-Gold agreement ended, Gold made several unsuccessful efforts to contact March in order to obtain an accounting. On May 20, 1971, Gold sent a letter to March requesting an accounting under their agreement. March denies receiving this letter. In September 1971 Gold finally met with March, at which time Gold was informed by March that the Western Land stock was worth $.50 per share. In early 1972, Gold hired another attorney, who sued March for an accounting and rescission of their original agreement. In settling that case, March agreed to repay Gold over $3,000. Gold testified he felt this was the best settlement he could receive, although he suffered a substantial loss and was forced to pay his attorney fees.

We recognize that respondent was not acting in his professional capacity with respect to his dealings with Gold. However, we agree with the hearing panel and Review Board that March may be subject to discipline for conduct outside his professional capacity. “[I] t is not necessary that his acts be strictly in the discharge of professional duties. Any act which evidences want of professional or personal honesty, such as renders him unworthy of public confidence affords sufficient grounds for disbarment.” In re Melin (1951), 410 Ill. 332, 337; see also In re Sanitary District Attorneys (1932), 351 Ill. 206, 237.

We believe the sale of respondent’s wife’s stock to Gold at a price substantially above its then market value, together with his misrepresentation of the value of the Western Land Corporation stock, supports the conclusion of the hearing panel and Review Board that March’s conduct with respect to Irving Gold “constitutes fraud, deceit and misrepresentation, the representation of conflicting interests to his own advantage and is conduct which is unprofessional and unethical and which tends to bring the legal profession into disrepute.” Illinois Code of Professional Responsibility, as approved by the Illinois State Bar Association (rev. 1977), Canon 1, Disciplinary Rule 1-102(A)(4).

Counts VI and VII concern alleged unethical and unprofessional conduct based upon respondent March’s attorney-client relationship with Crestón and Freída McIntyre. The McIntyres consulted respondent concerning a medical malpractice claim stemming from the alleged negligence of a doctor in examining and treating Freída McIntyre on February 16, 1968. Respondent was retained by the McIntyres on July 21, 1969, on a 50% contingency basis and was paid a $1,000 retainer.

After approximately 9 months elapsed with no apparent action by respondent, the McIntyres took the initiative and consulted him. On April 17, 1970, the McIntyres paid March $1,000 in exchange for a promissory note from March due and payable, with interest, 3 years from that date. Crestón McIntyre testified that it was his impression that this amount was to cover the costs of the suit if it was unsuccessful, while March contends it was unrelated to the malpractice claim and was received in response to his general representation to the McIntyres that it was a good investment period. In any event, this note was not paid when due. Additionally, on that same date, the McIntyres paid respondent $500 to cover the costs of employing a doctor to assist them in pursuing their malpractice claim.

On May 22, 1970, 10 months after the McIntyres had retained March and 3 months after the 2-year statute of limitations had expired, suit was filed by March on behalf of the McIntyres against the allegedly negligent doctor. That suit was dismissed because barred by the 2-year statute, and an amended complaint was filed attempting to allege fraudulent concealment by the doctor which would have brought the case under the 5-year statute of limitations. The amended complaint was dismissed for failure to allege facts stating a cause of action under the 5-year statute. An appeal was dismissed by the appellate court for lack of jurisdiction because notice of appeal had not been timely filed, and this court subsequently denied leave to appeal.

Throughout this period, respondent March assured the McIntyres that their claim was in the appellate court and ultimately this court. Such assurances apparently did not include the fact that the suit had been dismissed and that an appeal was necessary to attempt to vacate that dismissal. Further, in April 1971, March solicited an additional $800 to finish the case.

The McIntyres were ultimately forced to retain other counsel in their attempt to recover the amounts paid to March, including the amount of the promissory note. In September 1972 a suit was filed which resulted in a default judgment against March. March has apparently satisfied this judgment by repaying the $3,300 which he had obtained from the McIntyres. However, this repayment was accomplished only after much effort and expense by the McIntyres. In fact, Crestón McIntyre testified that the McIntyres had personally recovered only about one-third of the amount which they had paid to March.

In sum, March’s neglect of the legal matter which the McIntyres entrusted to him caused their suit to be dismissed as barred by the statute of limitations. Throughout their relationship, March was, at best, less than honest with his clients as to the status of their case. He did, however, continue to request and receive money from them. The McIntyres were forced to resort to the added effort and significant expense of retaining other counsel and filing of suit simply to obtain any settlement with March.

We agree with the hearing panel and Review Board that March’s actions constitute gross neglect of a legal matter entrusted to him, dishonesty and misrepresentation, and abuse of the attorney-client relationship, and is conduct which is unprofessional and unethical and which tends to bring the legal profession into disrepute. See generally, Illinois Code of Professional Responsibility, as approved by the Illinois State Bar Association (rev. 1977), Canons 1, 2, 6; Disciplinary Rules 1—102(A)(1), 2—101(B), 6—101(A)(3).

Count IX of the complaint against respondent is based upon his refusal to honor a subpoena duces tecum issued by the clerk of this court. This subpoena commanded respondent to appear and produce documents before the Administrator in connection with the investigation of the charges against him. Although respondent’s motion to quash that subpoena on fifth amendment grounds was denied by this court, he did not produce the requested documents. No further action was taken to enforce the subpoena.

Respondent’s argument centers on his contention that the fifth amendment guarantee against self-incrimination applies here to exempt him from any obligation to produce the requested documents or to testify to the matters in question. The applicable provision of the fifth amendment provides that no person “shall be compelled in any criminal case to be a witness against himself” (emphasis added). This provision is, of course, made applicable to the States by the fourteenth amendment. (Malloy v. Hogan (1964), 378 U.S. 1, 12 L. Ed. 2d 653, 84 S. Ct. 1489.) Article I, section 10, of the Illinois Constitution contains substantially the same language.

Prior to the Supreme Court’s decision of Spevack v. Klein (1967), 385 U.S. 511, 17 L. Ed. 2d 574, 87 S. Ct. 625, discussed later, no question existed regarding an attorney’s obligation to testify or produce requested documents in a disciplinary proceeding. “It is axiomatic that an attorney whose conduct is questioned must appear for examination under oath, and must submit for examination whatever records are in his possession relevant to the inquiry.” (In re Krasner (1965), 32 Ill. 2d 121, 126.) “The choice of silence is not open to him if he is to remain an officer of the court.” (In re Royal (1963), 29 Ill. 2d 458, 460 (quoting In re Sanitary District Attorneys (1932), 351 Ill. 206, 256).) Wholly apart from the issue of whether respondent was required to testify and produce the documents, however, he was not justified in simply ignoring the subpoena. The subpoena had been properly issued, and attempts to quash it had failed. It was therefore respondent’s professional obligation to comply with the court order. UMW Hospital v. UMW District 50 (1972), 52 El. 2d 496; County of Peoria v. Benedict (1970), 47 Ill. 2d 166; Board of Education v. Kankakee Federation of Teachers Local 886 (1970), 46 Ill. 2d 439.

The salient question therefore becomes whether attorney disciplinary proceedings are to be considered criminal in nature. We believe they are not. “The first purpose of a proceeding to discipline a member of the bar is to protect members of the public, to maintain the integrity of the legal profession and to safeguard the administration of justice from reproach.” (In re Nowak (1976), 62 Ill. 2d 279, 283. See also In re Leonard (1976), 64 Ill. 2d 398.) “Punishment is not the object. The object of such an inquiry is to determine whether the attorney is a proper person to be permitted to practice his profession.” In re Andros (1976), 64 Ill. 2d 419, 423.

We believe this case is controlled by the reasoning of In re Schwarz (1972), 51 Ill. 2d 334, cert. denied (1972), 409 U.S. 1047, 34 L. Ed. 2d 499, 93 S. Ct. 527. In that case, a disciplinary proceeding was brought based upon testimony which an attorney had given under a grant of immunity at a prior criminal trial. The attorney objected to the use of such testimony at the disciplinary proceeding as violative of the fifth amendment and contrary to the statutory immunity which he had been granted. In allowing the immunized testimony to be used, this court rejected the attorney’s contention based upon its finding that the immunity applied only to criminal prosecutions and not to attorney disciplinary proceedings. “The respondent has not been prosecuted criminally by reason of his testimony, and his fifth amendment rights have not been violated.” 51 Ill. 2d 334, 338.

A similar result was recently reached by the United States Court of Appeals for the Seventh Circuit in an analogous case. (In re Daley (7th Cir. 1977), 549 F.2d 469, cert. denied (1977), 434 U.S. 829, 54 L. Ed. 2d 89, 98 S. Ct. 110.) There, the court discussed the “remedial” rather than criminal nature of Illinois attorney disciplinary proceedings. (549 F.2d 469, 475-77.) Thus, despite a grant of immunity from criminal prosecution which specifically purported to preclude the use of incriminating testimony at subsequent disciplinary proceedings, the court held the introduction of such testimony was not proscribed by the fifth amendment privilege against self-incrimination. 549 F.2d 469, 474-78.

In holding the fifth amendment inapplicable to attorney disciplinary proceedings, we join all of the jurisdictions which have spoken to this issue. Illustratively, the Court of Appeals of New York has recently held in a per curiam opinion that testimony compelled before a grand jury under a grant of immunity could be introduced at disciplinary proceedings without violating the Federal or New York constitutions. (In re Anonymous Attorneys (1977), 41 N.Y.2d 506, 362 N.E.2d 592, 393 N.Y.S.2d 961.) The court believed this result to be required by the State’s interest in regulating the legal profession.

“The State has a compelling interest in regulating our system of justice to assure high standards of professional conduct. Sanctions imposed in that capacity are distinct and apart from penalties and forfeitures stemming from criminal proceedings. Once the constitutional guarantee that no person ‘shall be compelled in any criminal case to be a witness against himself’ is assured by a grant of immunity, the State may act, and indeed must act, in its supervisory capacity to assure that those standards are maintained.” In re Anonymous Attorneys (1977), 41 N.Y.2d 506, 511, 362 N.E.2d 592, 597, 393 N.Y.S.2d 961, 965.

The Supreme Court of California similarly has found that neither the fifth amendment nor the equivalent provision of the California Constitution prohibited the introduction during disciplinary proceedings of testimony given under a grant of immunity before a congressional committee or at an earlier trial. (Segretti v. State Bar (1976), 15 Cal. 3d 878, 544 P.2d 929, 126 Cal. Rptr. 793.) For a list of other States reaching the same conclusion, see In re Daley (7th Cir. 1977), 549 F.2d 469, 476 n.6. See also Annot., 62 A.L.R.3d 1145 (1975).

In asserting his contentions based upon the fifth amendment, respondent places great reliance upon Spevack v. Klein (1967), 385 U.S. 511, 17 L. Ed. 2d 574, 87 S. Ct. 625. Spevack involved an attorney’s refusal to testify or produce documents in connection with a disciplinary inquiry into his alleged misconduct. No grant of immunity from the subsequent use of such testimony or documents in criminal proceedings had been given. A divided Supreme Court held that professional discipline could not be imposed based upon these circumstances. But that holding in no way implies that, once immunity coextensive with the privilege is granted, the statements may not be used in disciplinary proceedings.

This court has indicated that Spevack should not be read so broadly as to hold the privilege against self-incrimination applicable to disbarment proceedings. (In re Schwarz (1972), 51 Ill. 2d 334, 338.) Rather, “[a]nswers may be compelled regardless of the privilege if there is immunity from federal and state use of the compelled testimony or its fruits in connection with a criminal prosecution against the person testifying.” (Schwarz at 338 (quoting Gardner v. Broderick (1968), 392 U.S. 273, 276, 20 L. Ed. 2d 1082, 1085, 88 S. Ct. 1913, 1915).) Compelling such testimony at disciplinary hearings does not offend the essential purposes of the privilege, and it serves the beneficial purpose of enabling States to effectively enforce and maintain their standards of professional conduct. In re Anonymous Attorneys (1977), 41 N.Y.2d 506, 511, 362 N.E.2d 592, 597, 393 N.Y.S.2d 961, 965.

The immunity required to satisfy the fifth amendment causes no problem in cases where incriminating testimony has been compelled at earlier proceedings. Such immunity from criminal prosecution has generally been provided by Federal or State authorities. There remains, however, the need to establish the existence of a use immunity which can be afforded to the attorney who, like respondent March, asserts his fifth amendment protections for the first time at the disciplinary proceedings. Thus, when the attorney is summoned before the disciplinary panel, there have not yet been guarantees against the use of such testimony at subsequent criminal proceedings sufficient to satisfy the fifth amendment. See Spevack v. Klein (1967), 385 U.S. 511, 17 L. Ed. 2d 574, 87 S. Ct. 625.

Analogously, in the context of intramural prison disciplinary proceedings, the Spevack line of cases has been read to hold that the fifth amendment will imply a grant of immunity from the use of testimony at subsequent criminal proceedings when a person is faced with a choice between self-incrimination and the relinquishment of a fundamental interest. Fowler v. Vincent (S.D.N.Y. 1973), 366 F. Supp. 1224, 1228; see also Baxter v. Palmigiano (1976), 425 U.S. 308, 335 n.8, 47 L. Ed. 2d 810, 832 n.8, 96 S. Ct. 1551, 1566 n.8 (Brennan, J., concurring in part & dissenting in part).

A similar imposition of use immunity has been intimated for an attorney’s testimony in disciplinary proceedings. (In re Zuckerman (1967), 20 N.Y.2d 430, 231 N.E.2d 718, 285 N.Y.S.2d 1, cert. denied (1968), 390 U.S. 925, 19 L. Ed. 2d 985, 88 S. Ct. 856.) It seems to us, however, that an attorney is not entitled to be automatically protected from the future use of testimony given by him in a disciplinary proceeding. Rather, that protection should be afforded only where testimony has been given after the assertion by the respondent of a valid fifth amendment privilege and a resulting grant by this court of immunity from the future use of that testimony or its fruits in criminal proceedings. Society is best protected from corrupt lawyers by requiring the few members of our profession who may be so categorized to testify in disciplinary proceedings. If that testimony may, however, incriminate him, Spevack entitles the lawyer to refuse. Should the Administrator deem his testimony essential, a grant of immunity from the future use of such testimony in criminal proceedings against the respondent lawyer may be sought from this court upon reasonable notice to the respondent. There may be circumstances in which the possibility of jeopardizing a criminal prosecution by subjecting it to the claim that it was instituted or advanced by the use of information derived from testimony compelled in a disciplinary proceeding ought not to be risked. Resolution of that issue in a manner which sufficiently implements fifth amendment protections while adequately supervising the legal profession will be this court’s responsibility.

We accordingly hold that an attorney in a disciplinary proceeding may be compelled to testify if he is granted immunity by this court from the use of such testimony at subsequent criminal proceedings and is so informed at the disciplinary hearing. Thereafter, a continued refusal to testify may, obviously, result in disciplinary sanctions.

These procedures were not followed in this case. We believe, however, in light of the evidence in this record, it. is unnecessary to remand the cause to afford the Administrator the opportunity to consider petitioning for such immunity in order to compel respondent’s testimony.

We come then to a consideration of the discipline to be imposed. In view of our conclusion that the proof was insufficient to support count III and the fact that there is no record of prior disciplinary action against respondent, we conclude that his suspension from the practice of law for a period of 1 year and until the further order of the court is appropriate, and it is so ordered.

Respondent suspended.

MR. JUSTICE CLARK,

dissenting:

There can be no doubt that the Administrator has produced substantial evidence of serious misconduct by the respondent. However, my review of the record in this case also leaves me with no doubt that the rights of the respondent have been so thoroughly abused in these proceedings that the outcome ought not stand unchallenged. “[T] he imperative of judicial integrity” (Elkins v. United States (1960), 364 U.S. 206, 222, 4 L. Ed. 2d 1669, 1680, 80 S. Ct. 1437, 1447) mandates that we examine with the strictest scrutiny the conduct of those attorneys to whom we have entrusted the day-to-day operations of our disciplinary system. Here again, as in In re Madsen (1977), 68 Ill. 2d 472, 489-90 (Dooley & Clark, JJ., dissenting), I find that conduct wanting in several respects.

At the outset, it may be useful to comment generally upon what I perceive to be a disturbing trend in the operation of our disciplinary system. An unusually high number of the disciplinary cases which reach this court apparently involve sole practitioners and individuals with smaller, less prominent practices. I am not persuaded that professional misconduct is similarly concentrated among such attorneys. Rather, I fear that these attorneys are simply more convenient targets of disciplinary proceedings, because they are often forced by economic necessity to proceed pro se, as was the respondent in the instant case. The generally lower fees and contingent-fee arrangements provided by the sole practitioners and attorneys in smaller, less prominent law firms are the only means by which the vast majority of people can afford the legal representation to which the profession proclaims the public is entitled. See ABA Code of Professional Responsibility, Canon 2 (1976); Illinois Code of Professional Responsibility, Canon 2 (1977).

While this observation is not intended to imply that such attorneys are entitled to be judged by a lower than normal standard, neither should they be the sole focus of our disciplinary system.

The proceedings in the instant case demonstrate how easy it is for the Administrator to take undue advantage of the imbalance of forces between the Administrator and the respondent (see In re Madsen (1977), 68 Ill. 2d 472, 490 (Dooley & Clark, JJ., dissenting)), particularly where, as here, the respondent is an older attorney, in poor health, and forced to proceed pro se.

On August 7, 1975, in connection with counts IV through VII of his complaint, the Administrator demanded that the respondent admit the truth of certain facts and the genuineness of certain documents pursuant to Supreme Court Rule 216 (58 Ill. 2d R. 216). The respondent served timely notice of his objection to that request upon the Administrator. (See 58 Ill. 2d R. 216(c). See also 65 Ill. 2d R. 753(c) (practice before the Hearing Board governed by the practice in civil cases, as modified by rule).) That the objections also were styled in the form of a “motion to quash” is irrelevant, since they gave the Administrator more than adequate notice of their content and purpose, as well as a meaningful opportunity to respond thereto. (Cf. Parrino v. Landon (1956), 8 Ill. 2d 468, 470 (adequacy of pleadings), 58 Ill. 2d R. 2(a); Ill. Rev. Stat. 1975, ch. 110, par. 4 (construction of rules).) The proper procedure thus would have been for the Administrator to have requested the Hearing Board to hold a hearing to determine the propriety of the objection. Instead, the Administrator led the' Hearing Board to conclude that the respondent should be deemed to have admitted the matters in question. This was in itself an inaccurate statement of the law on the part of the Administrator and grounds for reversal of the decision of the Hearing Board.

The Hearing Board also apparently considered that the respondent’s objections to the Administrator’s request were, on the merits, insubstantial. This too was error. The respondent claimed that responding to the Administrator’s request for admissions might tend to incriminate him, and therefore his privilege against self-incrimination permitted him to refuse to respond to that request. In my opinion, the respondent’s position is clearly supported by the decision of the United States Supreme Court in Spevack v. Klein (1967), 385 U.S. 511, 17 L. Ed. 2d 574, 87 S. Ct. 625. In Spevack, the court unequivocally held that a respondent in an attorney disciplinary proceeding may refuse to answer questions on the grounds that his answers may subject him to possible criminal liability. Although that decision has been subject to much criticism (see, e.g., Underwood, The Fifth Amendment and the Lawyer, 62 Nw. U.L. Rev. 129 (1967)), it is nonetheless the supreme law of the land and is therefore binding upon this court. Martin v. Hunter's Lessee (1816), 14 U.S. (1 Wheat.) 304, 4 L. Ed. 97.

Like “[a] nod or a head-shake,” a request for the admission of facts and genuineness of documents “is as much a ‘testimonial’ or ‘communicative’ act in this sense as are spoken words” and therefore may not be compelled. See Schmerber v. California (1966), 384 U.S. 757, 762 n.5, 16 L. Ed. 2d 908, 914 n.5, 86 S. Ct. 1826, 1830 n.5.

Only if the respondent were immunized against both the direct use as well as the derivative use of his testimony could he be compelled to testify. (See, e.g., Lefkowitz v. Turley (1973), 414 U.S. 70, 38 L. Ed. 2d 274, 94 S. Ct. 316; Kastigar v. United States (1972), 406 U.S. 441, 32 L. Ed. 2d 212, 92 S. Ct. 1653.) Derivative use would include information obtained as a result of the respondent’s answers to a request for the admission of facts and genuineness of documents. Rule 216(e) contains no such prohibition against derivative use (and the hearing panel had no power to confer the necessary immunity), but subsection (c)(2) of Rule 216 expressly provides for objections based upon “privilege.” “Accordingly objections based on the self-incrimination privilege are available.” (8 C. Wright & A. Miller, Fed. Prac. & Proc. sec. 2262, at 735 (1970). Accord, Gordon v. FDIC (D.C. Cir. 1970), 427 F. 2d 578, 581.) While the foregoing authorities deal with the Federal rule on which our Rule 216 is based (see Ill. Ann. Stat., ch. 110A, par 216, Historical & Practice Notes (Smith-Hurd 1968)), the outcome is identical under the Illinois rule. See Keegan, Privileged Matters and Protective Orders, 1959 U. Ill. L.F. 801, 802 (privilege against self-incrimination available as an objection to a request for admissions under predecessor of Rule 216).

That the subjects of the request primarily were documents whose authenticity might otherwise have been proved did not take the request outside the scope of the privilege. A respondent may not be forced to give testimonial evidence which may provide any of the “links” in the chain leading to criminal prosecution. See, e.g., Hoffa v. United States (1966), 385 U.S. 293, 17 L. Ed. 2d 374, 87 S. Ct. 408.

The majority glosses over this problem by citing authority for the true but irrelevant proposition that attorney disciplinary proceedings are “remedial” rather than criminal in nature. (See In re Daley (7th Cir. 1977), 549 F.2d 469, cert. denied (1977), 434 U.S. 829, 54 L. Ed. 2d 89, 98 S. Ct. 110.) The issue in this case, however, is not whether the defendant has been forced to “incriminate” himself in these proceedings but, rather, whether the respondent has been unconstitutionally penalized, by these proceedings, for his perfectly legitimate refusal to provide evidence which might incriminate him in other proceedings. (Spevack v. Klein; Lefkowitz v. Turley (1973), 414 U.S. 70, 38 L. Ed. 2d 274, 94 S. Ct. 316; see also United States v. Kordel (1970), 397 U.S. 1, 25 L. Ed. 2d 1, 90 S. Ct. 763.) The majority, in effect, concedes that respondent was thus unconstitutionally penalized and that the proper procedure would have been to grant the respondent use and derivative use immunity. However, the majority apparently assumes that this was “harmless error” in light of the additional evidence adduced with regard to these counts. I do not agree. The nature of the transactions at issue here was hotly disputed, and it defies credulity to suggest that the Hearing Board (which expressly stated that it would take the matters deemed admitted into consideration) did not consider these improperly admitted matters in evaluating respondent’s conduct and credibility. Although neither this court nor the Review Board was bound by the findings of the Hearing Board, neither tribunal provided a de novo review of the Hearing Board’s proceedings adequate to purge the taint therein. Accordingly, by imposing a sanction based in part upon the counts which were the subject of the Administrator’s request for admissions, this court has unconstitutionally penalized the respondent for his assertion of privilege in response to that request. Spevack v. Klein. See also In re Holland (1941), 377 Ill. 346 (no sanction for good faith assertion of privilege).

The abuse of the respondent’s rights did not end with the improper admission of the aforementioned matters. At the conclusion of the Administrator’s case the chairman of the hearing panel made the following statement to respondent:

“If you propose to become a witness as to any of these complaints you will have waived your privilege as to those complaints, and I look somewhat askant at you now taking that position after having claimed the privilege when Mr. O ’Malley wanted to put it in his case, because his case might have been totally different.” (Emphasis added.)

Forcing a respondent to choose between testifying before he has heard all of the other evidence and not testifying at all violates his privilege against self-incrimination. (Brooks v. Tennessee (1972), 406 U.S. 605, 610, 32 L. Ed. 2d 358, 362, 92 S. Ct. 1891, 1898.) In Brooks, the Supreme Court struck down a statute requiring a defendant to choose between testifying at the beginning of his own case and not testifying at all. The court explained:

“Pressuring the defendant to take the stand, by foreclosing later testimony if he refuses, is not a constitutionally permissible means of insuring his honesty. It fails to take into account the very real and legitimate concerns that might motivate a defendant to exercise his right of silence. And it may compel even a wholly truthful defendant, who might otherwise decline to testify for legitimate reasons, to subject himself to impeachment and cross-examination at a time when the strength of his other evidence is not yet clear. For these reasons we hold that [the statute] violates an accused’s constitutional right to remain silent insofar as it requires him to testify first for the defense or not at all.” 406 U.S. 605, 611-12, 32 L. Ed. 2d 358, 363, 92 S. Ct. 1891, 1895.

The facts of this case reveal an even more serious violation, in that the Hearing Board would have had the respondent testify even earlier than was required by the statute found unconstitutional in Brooks.

Given the Hearing Board’s power to recommend sanctions which would gravely impact and perhaps terminate the respondent’s professional career, the chairman’s above-quoted statement cannot be assumed to have been taken lightly by the respondent, and therefore ought not be overlooked by this court. That statement only can be interpreted to mean that the respondent would be penalized for his assertion of privilege by being forced to choose between not testifying, and having the chairman “look askant” at him, i.e., “with disapproval or distrust: suspiciously” (Webster’s Third New International Dictionary 128 (1971) (definition of askance)).

The impact of this error was far more serious than a minor, technical one from which no prejudice results. (Cf. In re Damisch (1967), 38 Ill. 2d 195.) The evidence against the respondent (other than the improperly admitted documents) consisted primarily of the testimony of individuals as to their conversations and transactions with the respondent. Respondent’s testimony might have shed an entirely different light upon those conversations and transactions, demonstrating a different degree of, or perhaps even the complete absence of, misconduct on his part. Thus, the chairman’s statement rendered the respondent’s assertion of privilege impermissibly “costly” (Spevack v. Klein; cf. In re Holland (1941), 377 Ill. 346 (no sanction for good faith assertion of privilege)), and it is inappropriate for us to rely upon this record to impose a sanction with regard to the remaining part of count III, as well as with regard to counts IV through VII.

Respondent’s own statements before us, and in documents filed in this court, form an adequate basis for the imposition of a sanction with regard to count IX, however. The respondent wilfully failed to comply with a subpoena issued by the clerk of this court. That wilful failure was based solely on the respondent’s'own opinion that it was not necessary for him to comply, and is therefore inexcusable. While the respondent may have had a colorable argument with regard to the applicability of the privilege against self-incrimination to the documents subpoenaed, as an experienced attorney he knew that the proper means of asserting that privilege was through a timely motion to quash the subpoena. Respondent did not move to quash the subpoena until four months after he was served with it (and over three months after it was returnable). His assertion of privilege in response to ..the subpoena therefore was outrageously untimely, and his brief periods of illness during this delay cannot fully excuse this misconduct. Thus, only with regard to this count do I agree a sanction may be imposed.

While I recognize that reasonable people may differ with regard to whether I or my colleagues have correctly determined whether the violations of respondent’s rights were harmless, I do not see any room for disagreement as to the existence of such violations. Therefore I respectfully dissent from my brothers’ disposition of this case.


source: Caselaw Access Project

author: MR. CHIEF JUSTICE WARD MR. JUSTICE RYAN,

license: Public Domain

text:
    (No. 49612.
    (No. 49629.
    (No. 49630.
    THE PEOPLE OF THE STATE OF ILLINOIS, Appellant, v. VALLEY STEEL PRODUCTS COMPANY et al., Appellees.-THE PEOPLE OF THE STATE OF ILLINOIS, Appellant, v. J. D. BARTER CONSTRUCTION COMPANY et al., Appellees.-THE PEOPLE OF THE STATE OF ILLINOIS, Appellant, v. J. D. BARTER CONSTRUCTION COMPANY, Appellee.

      Opinion filed April 3, 1978.

      Modified on denial of rehearing May 26, 1978.

      RYAN, J., dissenting.
    William J. Scott, Attorney General, of Springfield, and C. Joseph Cavanagh, State’s Attorney, of Springfield (Donald B. Mackay and Philip Weber, Assistant Attorneys General, and Wayne Golomb, Assistant State’s Attorney, of counsel), for the People.
    Robert G. Heckenkamp, of Heckenkamp & Fuiten, of Springfield, and Thomas J. Guilfoil, Jim J. Shoemake, and John W. O’Neil, Jr., of Guilfoil, Symington, Petzall & Shoemake, of St. Louis, for appellees Valley Steel Products Company and Howard Neuman.
    No. 49629. — Appeal from the Circuit Court of Sangamon County, the Hon. George P. Coutrakon, Judge, presiding.
    William J. Scott, Attorney General, of Springfield, and C. Joseph Cavanagh, State’s Attorney, of Springfield (Donald B. Mackay, Philip Weber, and Gerri Papushkewych, Assistant Attorneys General, of counsel), for the People.
    Jenner & Block, of Chicago, and Hendricks & Watt, of Murphysboro (David W. Watt, Jr., of counsel), for appellees J. D. Barter Construction Company, James Guard, and Robert W. Henley.
    No. 49630. — Appeal from the Circuit Court of Sangamon County, the Hon. Harvey Beam, Judge, presiding.
    William J. Scott, Attorney General, of Springfield (Donald B. Mackay and Philip Weber, Assistant Attorneys General, of counsel), for the People.
    Thomas P. Sullivan, Donald R. Harris, Jeffrey D. Colman, Eugene R. Wedoff and Kathleen J. Purcell, of Chicago (Jenner & Block, of counsel), for appellee J. D. Barter Construction Company.
   MR. CHIEF JUSTICE WARD

delivered the opinion of the court:

In each of these appeals, cause No. 49612, People v. Valley Steel Products Co., and causes No. 49629 and 49630, People v. J. D. Barter Construction Co., the circuit court for Sangamon County dismissed indictments returned by the grand jury on August 27, 1975, which charged the corporate defendants and various individuals with violations of sections of the Motor Fuel Tax Law (Ill. Rev. Stat. 1975, ch. 120, pars. 417 et seq.) (the Act).

In causes No. 49612 and 49629 the circuit court dismissed the indictment for the reason, among others, that the Act violated the equal protection clause of article I, section 2, of the Illinois Constitution. The State took a direct appeal under Rule 302(a)(1) (58 Ill. 2d R. 302(a)(1)). In cause No. 49630, the circuit court upheld the Act on the equal protection issue, but dismissed the indictment on nonconstitutional grounds. The State took an appeal to the appellate court, the appeal was transferred here under Rule 302(b) (58 Ill. 2d R. 302(b)), and the three causes were consolidated for argument and decision.

In cause No. 49612, People v. Valley Steel Products Co., the indictment named both Valley Steel Products Company (Valley Steel) and Howard Neuman, alleged in the indictment to be Valley Steel’s comptroller and secretary-treasurer. Various counts of the indictment alleged that Valley Steel was doing business in Illinois as a licensed bulk user of special fuel, and that, over the period from April 1973 through January 1975, the defendants failed to comply with section 5b of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 421b), which requires a monthly return showing the amount of special fuel received or purchased during the preceding month, in that the returns understated these amounts. Other counts charged that Valley Steel was doing business in Illinois, that it was not licensed as either a supplier or a distributor of motor fuel, and that, over the period from July 1972 to January 1975, the defendants had made purchases of motor fuel, but had failed to pay the motor fuel tax to the State, as required by section 7 of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 423).

It was charged in other counts of the indictment that the defendants had distributed motor fuel without a license, in violation of section 3 (Ill. Rev. Stat. 1975, ch. 120, par. 419) of the Act, by transporting motor fuel into Illinois and distributing it to points located in three named Illinois municipalities.

Valley Steel filed a motion to dismiss all counts of the indictment on the grounds that a corporation is not subject to criminal prosecution for violations of the Act and that the Act violated the equal protection clause of article I, section 2, of the Illinois Constitution, in that the Act designated violations as Class 3 and Class 4 felonies, whereas comparable violations of other statutes imposing use and occupation taxes were punishable only as misdemeanors or business or petty offenses. Valley Steel also moved to dismiss the charges of distributing motor fuel without a license on the ground that the communities in which distribution was allegedly made were located in counties other than the County of Sangamon, so that venue was improper under section 1—6 of the Criminal Code of 1961 (Ill. Rev. Stat. 1975, ch. 38, par. 1—6).

The defendant Neuman, also filed amotion to dismiss. It paralleled that of Valley Steel on the equal protection and venue issues. Neuman’s motion also asserted that the indictment was defective since it did not allege that he was the person responsible for filing tax returns or making payment of any taxes due. In a memorandum opinion accompanying its order of dismissal, the trial court found in favor of the defendants on each of their contentions.

In cause No. 49629, the indictment named as defendants J. D. Barter Construction Company (Barter), James Guard, and Robert W. Henley. Guard was alleged to be the general manager of Barter, and Henley was alleged to be a commission agent for Mobil Oil Corporation. The indictment charged Barter and Guard with violation of sections 5b and 7 of the Act. In addition the indictment charged that the defendant Henley was responsible for reporting to Mobil Oil Corporation the amount of motor fuel tax from the sale of special fuel made to Barter, but that he failed to do so, thereby causing Mobil to fail to collect and pay over said tax, as required by section 6 (Ill. Rev. Stat. 1975, ch. 120, par. 422).

The trial court’s dismissal of the indictment rested on its acceptance of the defendants’ contentions as to violation of the equal protection clause and of corporate immunity from prosecution. Certain counts were also dismissed because they failed to allege a mental state or a specific intent as defined by section 4—9 of the Criminal Code of 1961 (Ill. Rev. Stat. 1975, ch. 38, par. 4-9).

In cause No. 49630, the indictment, which named Barter alone, charged it with violations of section 13 of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 429) in filing claims for refunds of motor fuel tax payments which falsely stated that the fuel purchased on which the refund was claimed was used for a nontaxable purpose. In this case, which was heard by a different judge, the circuit court rejected the defendant’s claim as to the violation of the equal protection clause, but accepted the claim of corporate immunity from prosecution.

We turn first to the contention that the corporate defendants were not amenable to criminal prosecution. The first paragraph of section 15 of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 431) provides that “any person” who acts as a distributor of motor fuel or as a supplier or a bulk user of special fuel without a license, or who fails to make payment of an amount of tax due, commits a criminal offense, and paragraphs 2 and 5 specify as criminal offenses the failure to make a monthly return, and the making of a false report to the Department of Revenue. Thus the actions with which these defendants were charged are all encompassed by section 15. These defendants maintain, however, that section 1.11 of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 417.11) wholly removes them from the operation of section 15. Section 1.11 provides:

“ ‘Person’ means any natural individual, firm, trust, estate, partnership, association, joint stock company, joint adventure, corporation, or a receiver, trustee, conservator, or other representative appointed by order of any court, or any city, town, county or other political subdivision in this State. Whenever used in any Section of this Act prescribing and imposing a fine or imprisonment or both, the term ‘person’ as applied to partnerships and associations shall mean the partners or members thereof, and as applied to corporations the term ‘person’ shall mean the officers, agents, or employees thereof who are responsible for any violation of this Act.” (Emphasis added.)

The defendants read the italicized portion of this section not simply as specifying that corporate officers, agents, and employees are among those subject to prosecution, but as excluding the corporation itself from prosecution. This construction of the section would produce the unusual result of placing upon an officer or employee the sole criminal liability for actions concededly performed on behalf of his corporation. We are referred to no other statute, either in the field of taxation or otherwise, in which such an insulation from liability has been created. It is a construction which would effect a discrimination against those distributors operating as sole entrepreneurs rather than as corporations or partnerships.

In considering the Act as a whole, its legislative antecedents, and judicial decisions construing them, we conclude that the defendants’ claim of corporate immunity is not well founded.

From its original enactment in 1929 (Smith-Hurd Rev. Stat. 1929, ch. 120, pars. 417 through 434; 1929 Ill. Laws 625) until 1935, the Act contained no definition at all of “person.” The Act simply set forth its regulatory requirements, and prescribed the penalties imposed on “whoever” violated them. In 1935 a definition of “person,” identical to that which now appears as the first sentence of section 1.11, was added to section 1 (Smith-Hurd Rev. Stat. 1935, ch. 120, par. 417; 1935 Ill. Laws 1184, 1185). It is not contended here that during this period a violator of the Act was immune from criminal prosecution if the violator was a corporation. People v. Strong (1936), 363 Ill. 602, 605; cf. People ex rel. Kerner v. Blue Rose Oil Co. (1935), 360 Ill. 397, 403, 405, cert. denied (1935), 296 U.S. 605, 80 L. Ed. 429; People v. McArdle (1938), 295 Ill. App. 149; Ill. Ann. Stat. 1975, ch. 38, par. 5—4, Committee Comments, at 318-19 (Smith-Hurd 1972); Comment, Corporate Criminal Liability, 68 Nw. U.L. Rev. 870, 871-77 (1973).

In two cases decided in 1936 involving the Motor Fuel Tax Law, this court delivered opinions which seemed to cast doubt on the legality of imposing criminal liability on officers and directors of corporations which had violated the Act. In People v. Strong (1936), 363 Ill. 602, officers and directors of a distributor were indicted for embezzlement in failing to pay over to the State taxes collected on the distribution of motor fuel. At that time the act of embezzlement charged was punishable only by imprisonment. The court reasoned that the officers and directors could not be indicted as accessories, since accessories cannot be given a punishment greater than their principal, and since the latter, being a corporation, could not be imprisoned. It was therefore held proper to quash the indictment.

The other case was People v. Duncan (1936), 363 Ill. 495. Here the defendant was indicted as an accessory before the fact in connection with the failure of the corporation to pay over to the State motor fuel taxes collected, and also on counts that the corporation had done business as a distributor without having a license. The defendant was found guilty and was sentenced to imprisonment on the latter charges. Although the penal provisions of the Motor Fuel Tax Law authorized punishment by either a fine or imprisonment, this court held that the defendant, charged as an accessory, could not be punished by imprisonment since such a penalty could not be imposed upon his corporate principal. The conviction was accordingly reversed.

In 1937 the General Assembly amended the Act (1937 Ill. Laws 1047). One portion of the amendatory legislation added a second sentence to the definition of “person.” That sentence was the same as the second sentence of what is now section 1.11 of the Act, except that the words “and include” preceded the words “the partners” and “the officers.”

The 1937 legislation also amended section 15 (Ill. Rev. Stat. 1975, ch. 120, par. 431) by adding, following the enumeration of the penalties imposed for violations of the Act, the following provision:

“In case such person acting as a distributor is a corporation, then the officer or officers, agent or agents, employee or employees, of such corporation responsible for any act of such corporation, or failure of such corporation to act, which act or failure to act constitutes a violation of any of the provisions of this Act as enumerated above, shall be punished by such fine or imprisonment, or by both such fine and imprisonment as herein above provided.”

In the light of the Strong and Duncan decisions, and the addition of the provision of section 15 quoted above, we conclude that the 1937 modification of the definition of persons subject to criminal prosecution, on which the corporate defendants here rely, was not designed to immunize corporations from criminal liability, but only to insure that responsible officers, directors, and employees should not be free from conviction as accessories to violations of the Act by their corporate principals simply because the latter, in the nature of things, could not be imprisoned.

The 1937 amendment to section 1 of the Act, as previously noted, provided that with respect to criminal liability, a person “shall mean and include” the officers, agents, or employees responsible for the violation. The term “include” does not necessarily imply the exclusion of items not specifically enumerated. This court discussed the various meanings of the word “include” in Illinois Central R.R. Co. v. Franklin County (1944), 387 Ill. 301, 313-18. We pointed out there that the term should not be construed as limiting the application of a law to those items specifically enumerated where such a construction would override the intent of the legislature. (See also Greyhound Lines, Inc. v. City of Chicago (1974), 24 Ill. App. 3d 718, 727-28.) As was said in the latter case, “the weight of authority ordinarily interprets ‘include’ as a term of enlargement.” 24 Ill. App. 3d 718, 728.

The defendants point out that in 1961 the words “and include” were deleted from section 1.11 (1961 Ill. Laws 3653, 3655). The third paragraph of section 15, however, which had been broadened in 1963 to include suppliers and bulk users as well as distributors (1963 Ill. Laws 1557, 1569-70), was left intact. We are not persuaded that in removing the words “and include” from section 1.11 the legislature intended to effect so major a change in the law as the abolition of corporate criminal liability.

We consider next the contention that the Act violates the equal protection clause of the Illinois Constitution because violations of the Act are designated felonies, whereas, the defendants maintain, corresponding violations of other statutes imposing taxes are punished as no more than misdemeanors.

We first observe that the statutory citations which appear in defendants’ briefs fall short of demonstrating the systematic discrimination which the defendants say exists. Thus, for example, the penalty for the first offense of failing to file a return under the Motor Fuel Tax Law is a Class B misdemeanor only (Ill. Rev. Stat. 1975, ch. 120, par. 431(2)), the same penalty which, according to defendants, is imposed under the Retailers’ Occupation Tax Act. In the view we take of the defendants’ equal protection claim, however, it is not necessary to enter upon a detailed comparison of the various revenue statutes of this State.

The statute here does not involve any “suspect” type of classification, nor is it one which touches upon fundamental constitutional, rights as these have been described by the decisions of this court and of the United States Supreme Court. It therefore need not be subjected to close scrutiny, and no more is required than that it have a rational basis. (People ex rel. Tucker v. Kotsos (1977), 68 Ill. 2d 88, 97-98; Note, A Question of Balance: Statutory Classifications under the Equal Protection Clause, 26 Stan. L. Rev. 155 (1973).) The words of this court in Jacobs v. City of Chicago (1973), 53 Ill. 2d 421, 425, are pertinent:

“The powers of a legislative body to make classifications, particularly in the field of taxation, are very broad and the classifications must be upheld if any state of facts reasonably can be conceived that would sustain them. (Thorpe v. Mahin, 43 Ill. 2d 36, 45; Midwest Freight Forwarding Co., Inc. v. Lewis, 49 Ill. 2d 441, 445.) Furthermore, there is a presumption in favor of the validity of the classification made by the legislative body and one who assails it has the burden of proving the classification to be arbitrary.”

In the customary challenge to legislation under the equal protection clause, a defendant contends that he is discriminated against in favor of other persons subject to the same tax. (See, e.g., Titus v. Texas Co. (1973), 55 Ill. 2d 437; Williams v. City of Chicago (1977), 66 Ill. 2d 423.) The defendants’ challenge here is far broader; it is that the statutory penalty imposed under the Motor Fuel Tax Law cannot exceed that imposed in connection with other taxes, including the retailers’ occupation tax, the State income tax, the service occupation tax, the cigarette use tax, and, in principle, any tax whatever. Defendants could as well urge that the amount of the fine, the period of imprisonment, and even the rate and incidence of this tax must be identical with those of other statutes imposing taxes. Such an “iron rule” of uniformity has been rejected. Sherman-Reynolds, Inc. v. Mahin (1970), 47 Ill. 2d 323, 329-30.

We do not believe that the demands of equal protection require this court to supplant the General Assembly and to take over what is essentially a legislative responsibility for determining what shall be an offense and what its punishment shall be. See People v. Burnett (1946), 394 Ill. 420, 425-26; People ex rel. Kubala v. Kinney (1962), 25 Ill. 2d 491, 492-93; People v. Williams (1977), 66 Ill. 2d 179, 186.

The defendants rely principally on People v. McCabe (1971), 49 Ill. 2d 338. In that case this court held that to include marijuana in the Uniform Narcotic Drug Act (Ill. Rev. Stat. 1969, ch. 38, pars. 22—1 to 22—49.1), with its substantially harsher penalties, rather than in the Drug Abuse Control Act (Ill. Rev. Stat. 1969, ch. 111½, pars. 801 through 812), was a constitutionally invalid classification. The decision rested on the court’s conclusion that the chemical properties and effects of marijuana did not provide a rational basis for the difference in penalties imposed under the two acts, but that, on the contrary, marijuana could more appropriately be grouped with the other drugs included under the Drug Abuse Control Act. (49 Ill. 2d 338, 347-49; cf. 66 Nw. U.L. Rev. 829 (1971).) McCabe struck down a classification within the general area of drugs. There is obviously no “class” of all taxpayers; McCabe has no pertinence here.

Certain counts of the indictment in cause No. 49612 charged that Valley Steel had acted as a distributor of motor fuel without a license by transporting such fuel into the State and delivering it into storage tanks located in three municipalities located elsewhere than in the County of Sangamon. Section 1—6 of the Criminal Code of 1961 provides that criminal actions shall generally be tried “in the county where the offense was committed.” (Ill. Rev. Stat. 1975, ch. 38, par. 1—6.) There is nothing in the indictment alleging that any distribution took place in the County of Sangamon. Contrary to the State’s suggestion, it is the act of engaging in distribution without a license rather than the failure to obtain a license which constitutes the offense under section 3 of the Act (Ill. Rev. Stat. 1975, ch. 120, par. 419). We accordingly affirm the judgment of the trial court insofar as it dismissed those counts alleging a violation of section 3.

Defendant Neuman argues that the counts charging him with a failure to file tax returns and to collect and pay the tax are defective as to him since they do not charge that he was the person responsible for performing those acts. It is readily apparent that the indictment did not charge Neuman with himself acting as a distributor, and thus liable to file returns on his own account, but that he was charged in his capacity as comptroller and secretary-treasurer of Valley Steel. While it will be incumbent upon the State to prove that Neuman did in fact have those responsibilities, we consider that that is a matter which goes to the sufficiency of the evidence, not to that of the indictment. It is of course unnecessary for an indictment to plead matters of evidence so long as the indictment sufficiently advises the defendant of the nature of the accusation so that he may prepare for his defense and will be able to plead the judgment in bar of subsequent prosecution. (See People v. Grieco (1970), 44 Ill. 2d 407, 408-10.) The same principle disposes of the claim that the indictment was deficient in failing to allege the amount of fuel that should have been reported or the amount of tax that was due. These are plainly matters of evidence. People v. Meaderds (1961), 21 Ill. 2d 145.

What has already been stated in this opinion disposes of the issues arising on these appeals, except for a contention made in cause No. 49629 that certain counts of the indictment are defective in failing to allege the mental state with which the offenses charged were committed. The counts involved are those which charge Barter, Guard, and Henley with filing false reports which understated the amount of special fuel purchased contrary to the requirement of section 5b, those which charge Barter with failure to pay taxes on motor fuel purchased, as required by section 7, and those charging Henley with failure to report to Mobil Oil Corporation the amount of tax due on sales of special fuel made to Barter, thereby causing Mobil to fail to collect and pay over the tax as required by section 6. Under section 15 of the Act the filing of a false report is made a Class 3 felony. Those counts of the indictment relating to that charge allege, however, that the understating of fuel purchased was done “knowingly.” Section 15 of the Act also provides that the failure to pay taxes due shall be a Class 4 felony.

The State, relying on People v. Player (1941), 377 Ill. 417, argues that the offenses charged are ones involving absolute liability under sections 4—3 and 4—9 of the Criminal Code of 1961 (Ill. Rev. Stat. 1975, ch. 38, pars. 4—3, 4—9), and therefore that no allegation of mental state is necessary. In People v. Player, while there is broad language that the statute in question made the failure to file a return criminal without proof of intent or knowledge, the defendant was convicted of failure to make monthly returns prescribed by section 3 of the Retailers’ Occupation Tax Act (Ill. Rev. Stat. 1939, ch. 120, par. 442). Section 13 of that act (Ill. Rev. Stat. 1939, ch. 120, par. 452) made the failure to file a return a misdemeanor, and the defendant was sentenced to pay a fine of $1,000 and to serve 90 days in jail.

Under sections 5—8—1 and 5—9—1 of the Unified Code of Corrections (Ill. Rev. Stat. 1975, ch. 38, pars. 1005—8—1, 1005—9—1), conviction of a Class 3 felony permits imprisonment for not over 20 years, and a fine of not over $10,000. For a Class 4 felony, imprisonment for not over 3 years and a fine of not over $10,000 are permitted. (Ill. Rev. Stat. 1975, ch. 38, pars. 1005—8—1, 1005—9—1.) Section 4—9 of the Criminal Code of 1961 provides that a person may be guilty of an offense without having, as to each element thereof, one of the mental states described in sections 4—4 through 4—7 if the offense is a misdemeanor which is not punishable by incarceration or by a fine exceeding $500, or the statute defining the intent clearly indicates a legislative purpose to impose absolute liability for the conduct described. Ill. Rev. Stat. 1975, ch. 38, par. 4—9.

While the Motor Fuel Tax Law is not part of the Criminal Code of 1961, section 4—9 of the Code is applicable to the penalty provisions involved here. We consider that the sections of the Act defining offenses punishable as felonies should not be construed, by virtue of section 4—9, to impose an absolute liability, since they do not “clearly indicate” a purpose to do so. The mere absence of express language describing a mental state does not per se lead to the conclusion that none is required. See Morissette v. United States (1952), 342 U.S. 246, 263, 96 L. Ed. 288, 300, 72 S. Ct. 240, 250. See also the final paragraph of the committee comments to section 4 — 9, where it is stated:

“In addition to permitting a construction requiring absolute liability in offenses [not] punishable by incarceration or by a fine of not more than $5 00, the second part of section 4—9 expresses the policy that in other offenses not including a mental state in the definition only a clearly indicated legislative intent to create absolute liability should be recognized, and in all other instances, a mental-state requirement should be implied as an application of the general rule that an offense consists of an act accompanied by a culpable mental state, as expressed in Section 4—3.” Ill. Ann. Stat., ch. 38, par. 4—9, Committee Comments, at 283 (Smith-Hurd 1972).

Also, and importantly, in looking to the question of intent under the Act, it cannot be reasonably said that the legislature, when it provided for penalties as high as 20 years’ imprisonment and fines as great as $10,000, intended the offenses it was creating to be absolute-liability offenses. It would be unthinkable to subject a person to a long term of imprisonment for an offense he might commit unknowingly. See Morissette v. United States (1952), 342 U.S. 246, 256, 260-61, 270-71, 96 L. Ed. 288, 296-97, 299, 304-05, 72 S. Ct. 240, 246, 248, 253-54.

The defendants state that if the penalty provisions involved here do not impose absolute liability then they must be read as incorporating a mental state requirement as prescribed by section 4-3(a) of the Criminal Code of 1961. From this it follows, they contend, that the indictments fail to comply with section 111—3 of the Code of Criminal Procedure of 1963 (Ill. Rev. Stat. 1975, ch. 38, par. 111—3), which requires, “(a) A charge shall *** allege the commission of an offense by: *** (3) Setting forth the nature and elements of the offense charged; ***.” (Cf. People v. Edge (1950), 406 Ill. 490, 493-94; People v. Harris (1946), 394 Ill. 325, 327-28.) We agree.

It follows that, for the reasons given above, the judgment of the circuit court in cause No. 49612 is affirmed insofar as it dismissed on the ground of improper venue the charges of acting as a distributor without a license, and the judgment of the circuit court in cause No. 49629 is affirmed insofar as it dismissed the charges that Barter failed to pay taxes on motor fuel purchased and that Henley failed to report the amount of tax due on sales to Barter. In all other respects the judgment in cause No. 49612 and the judgments in causes No. 49629 and 49630 are reversed and the causes are remanded.

49612 — Affirmed in part and reversed in part and remanded.

49629 — Affirmed in part and reversed in part and remanded.

49630 Reversed and remanded.

MR. JUSTICE RYAN,

dissenting:

In my opinion, the legislative history of the Act indicates that its present provisions were designed to hold individuals, not corporations, criminally liable for violations. As the majority notes, in 1935, “person” under the Act was defined as “any natural individual, firm, trust, estate, partnership, association, joint stock company, joint adventure, corporation, or a receiver, trustee, conservator, or other representative appointed by order of any court, or any city, town, county or other political subdivision of this State.” (Smith-Hurd Rev. Stat. 1935, ch. 120, par. 417; 1935 Ill. Laws 1184, 1185.) After this court refused to hold officers and directors liable as accessories for motor fuel tax violations, in People v. Strong (1936), 363 Ill. 602, and People v. Duncan (1936), 363 Ill. 495, the legislature, in 1937, amended section 1 of the Act to specifically include within the definition of “person” the officers, agents and employees of a corporation. The amendment was made by adding another sentence to the 1935 definition of “person” set out above. The added sentence read:

“Whenever used in any section of this act prescribing and imposing a fine or imprisonment or both, *** as applied to corporations the term ‘person’ shall mean and include the officers, agents, or employees thereof who are responsible for any violation of this act.” (Emphasis added.) Ill. Rev. Stat. 1937, ch. 120, par. 417; 1937 Ill. Laws 1047, 1048.

The italicized language above implies that the corporation, as well as individuals, could be criminally liable for violations. However, as the majority opinion notes, the legislature, in 1937, also amended section 15 of the Act (the penalty section). The addition provided that in the event the distributor violating the Act is a corporation, “then the officer or officers, agent or agents, employee or employees, of such corporation responsible for any act of such corporation, or failure of such corporation to act, which act or failure to act constitutes a violation of any of the provisions of this Act ***, shall be punished ***.” (Emphasis added.) (Ill. Rev. Stat. 1937, ch. 120, par. 431; 1937 Ill. Laws 1047, 1049.) These two amendments appear to be somewhat inconsistent; one indicates the corporation and individuals are liable, whereas the other only imposes penalties on individuals at fault when the distributor is a corporation.

In 1961, the legislature changed the definition of person in section 1.11 to its present form. In relevant part, it now states:

“ [A] s applied to corporations the term ‘person’ shall mean the officers, agents, or employees thereof who are responsible for any violation of this Act.” (Emphasis added.) (Ill. Rev. Stat. 1975, ch. 120, par. 417.11.)

In my opinion, the words “and include,” which followed the words “shall mean” in the 1937 amendment, were specifically deleted by the legislature in order to resolve the apparent inconsistency of the 1937 amendments. This deletion harmonizes section 1.11 with section 15 by excluding corporations from penalties and penalizing only the individuals responsible for the violations. I believe that a proper reading of the Act indicates that criminal penalties should only be imposed on the individuals responsible for the defalcation, not on the corporation.

I hasten to point out that under this construction a corporation would not be completely absolved from liability. In the event that an erroneous return was filed or the proper tax was not paid, the corporation would still be liable for the tax plus substantial civil penalties under sections 4 and 5 of the Retailers’ Occupation Tax Act (Ill. Rev. Stat. 1975, ch. 120, pars. 443, 444), as made applicable to the Motor Fuel Tax Law by section 21 thereof (Ill. Rev. Stat. 1975, ch. 120, par. 434a). The fact that a dishonest, careless or incompetent officer or employee fails or refuses to pay the tax is certainly no reason to penalize the shareholders by imposing heavy criminal sanctions on the corporation, when it has derived no benefit from the violation. Thus, it appears logical to impose criminal sanctions only against the individual who is directly responsible for the violation.


author: MR. JUSTICE RYAN

text:
    (No. 49469.
    CENTURY DISPLAY MANUFACTURING CORP. et al., Appellants and Cross-Appellees, v. D. R. WAGER CONSTRUCTION CO., INC., et al.-(United States Steel Corporation, Appellee and Cross-Appellant.)

      Opinion filed May 16, 1978.

      GOLDENHERSH AND KLUCZYNSKI, JJ., took no part.
    Clausen, Miller, Gorman, Caffrey & Witous, P.C., of Chicago (James T. Ferrini and Thomas H. Ryerson, of counsel), for appellants.
    Jerome N. Groark, James G. McConnell, Weston W. Marsh, and Christine M. Wheelock, of Chicago (Rooks, Pitts, Fullagar & Poust, of counsel), for appellee.
   MR. JUSTICE RYAN

delivered the opinion of the court:

This action was filed in the circuit court of Cook County by plaintiffs, Century Display Manufacturing Corporation (Century), and Hartford Fire Insurance Company and Reliance Insurance Company, subrogees of Drovers National Bank of Chicago, trustee, against United States Steel Corporation (U.S. Steel), and two other defendants not involved in this appeal, to recover damages for fire loss to Century’s property. Plaintiffs’ complaint alleged both negligence (count II) and willful and wanton conduct (count III) by U.S. Steel. The court allowed U.S. Steel’s motion for summary judgment and plaintiffs appealed. The appellate court affirmed the circuit court with respect to count II, but reversed and remanded as to count III. (46 Ill. App. 3d 643.) We granted plaintiffs’ petition for leave to appeal from that portion of the appellate court’s order affirming summary judgment for U.S. Steel with respect to count II, and pursuant to our Rule 318 (58 Ill. 2d R. 318) we have granted U.S. Steel’s request to review the appellate court’s order reversing summary judgment as to count III.

On April 28, 1970, U.S. Steel entered into a contract to sell to Century premises formerly known as U.S. Steel Chemical Division, which had been used for the manufacture of various organic coating products until 1967, when production at the plant ceased. Included in the sale of the building were various fixtures, including pipes and tanks which had been used for the transmission and storage of the materials and chemicals used in the manufacture of the coating products. Among the materials that had been contained in the tanks and pipes were asphalt solvents, kerosene, and several other flammable products.

Century went into possession of the premises on May 14, 1970. Soon thereafter, Century retained D. R. Wager Construction Company, Inc., to remodel portions of the building. On August 5, 1970, a fire broke out at the site where Wager was working on the premises. While the exact cause of the fire is undetermined, allegedly the flammable liquid still in the tanks and pipes was ignited in the course of Wager’s work. The ensuing blaze ultimately destroyed the building and other property which Century had stored on the premises.

The plaintiffs sought recovery for damages to the property from Wager and its alleged agent, as well as from U.S. Steel. Count I of the complaint was directed against Wager and the alleged agent, who are not parties to the present appeal.

Counts II and III against U.S. Steel are premised upon sections 352 and 353 of the Restatement (Second) of . Torts, both of which have been acknowledged by this court as stating the law in Illinois. (See Sparling v. Peabody Coal Co. (1974), 59 Ill. 2d 491.) Section 352 sets forth the general proposition that a vendor of land is not liable for physical harm to a vendee or to others after the vendee has taken possession caused by a dangerous condition, which condition existed at the time the vendee took possession. (Restatement (Second) of Torts sec. 352 (1965); Anderson v. Cosmopolitan National Bank (1973), 54 Ill. 2d 504.) Section 353 of the Restatement carves out an exception to the general rule of nonliability, applicable when the vendor conceals or fails to disclose to his vendee a condition which poses an unreasonable risk to persons on the land. Section 353 provides:

“(1) A vendor of land who conceals or fails to disclose to his vendee any condition, whether natural or artificial, which involves unreasonable risk to persons on the land, is subject to liability to the vendee and others upon the land with the consent of the vendee or his sub vendee for physical harm caused by the condition after the vendee has taken possession, if
(a) the vendee does not know or have reason to know of the condition or the risk involved, and
(b) the vendor knows or has reason to know of the condition, and realizes or should realize the risk involved, and has reason to believe that the vendee will not discover the condition or realize the risk.
(2) If the vendor actively conceals the condition, the liability stated in Subsection (1) continues until the vendee discovers it and has reasonable opportunity to take effective precautions against it. Otherwise the liability continues only until the vendee has had reasonable opportunity to discover the condition and to take such precautions.”

The appellate court held, and U.S. Steel urges in this court, that recovery for damage to property is not authorized under the law as stated in section 353 except in cases where a contractor-builder sells newly constructed residential property to a layman. It is defendant’s contention that the term “physical harm,” as contained in section 353, does not include damages to property but refers solely to recovery for personal injuries. However, section 7(3) of the Restatement (Second) of Torts (1965) states:

“The words ‘physical harm’ are used throughout the Restatement of this Subject to denote the physical impairment of the human body, or of land or chattels.”

Again, in comment e to section 7 it is stated:

“Physical harm. The words ‘physical harm’ are used to denote physical impairment of the human body, or of tangible property, which is to say land or chattels. Where the harm is impairment of the body, it is called ‘bodily harm,’ as to which see section 15.”

Although the overwhelming majority of cases in this area of tort liability concern themselves with recovery for damages incurred as a result of bodily injury (see Annot., 8 A.L.R.2d 218 (1949); Annot., 48 A.L.R.3d 1027 (1973); 65 C.J.S. Negligence sec. 93 (1966)), it is clear that the term “physical harm,” as used in section 353, encompasses damages to tangible property as well as injuries to the person. Because of the disposition we make of this case we need not decide another of defendant’s contentions, that is, whether recovery under section 353 is permissible for damages to the property which is the subject of the transfer from the vendor to the vendee, or whether such recovery is limited to damages to other property of the vendee which is located on the conveyed premises.

Although we have held that the appellate court erred in failing to apply section 353 of the Restatement to cases involving property damage, we nonetheless conclude that the appellate court properly affirmed the order of the trial court granting summary judgment for U.S. Steel on count II. Summary judgment is proper when the pleadings, together with depositions, the affidavits and other materials filed in support of and in opposition to the motion, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. (Econo Lease, Inc. v. Noffsinger (1976), 63 Ill. 2d 390; Fooden v. Board of Governors (1971), 48 Ill. 2d 580.) Voluminous materials, consisting of affidavits, answers to detailed interrogatories, and depositions, were filed by both parties. After considering all of these we conclude that there was no triable issue of material fact and that the defendant was entitled to judgment as a matter of law.

The appellate court’s opinion correctly points out that this was an arm’s length transaction between corporations, whose officers were represented by attorneys and were knowledgeable in the many ramifications of real estate transfers. In fact, one of the corporations, of which the president of Century was also an officer, was engaged in the business of purchasing and liquidating commercial plants. After extensive negotiations it was at plaintiff Century’s suggestion that, for a reduced price, the sale of the plant be consummated on an “as is” basis. Joseph T. Weiss, the president of Century, stated that the term “as is” means that the vendee takes the premises, including all the equipment and material thereon, as they existed, that is, everything in its then condition. Hugh W. Best, an officer of an affiliated company, and Weiss had inspected the property for Century on several occasions before the sale and, as will be noted later on, after the sale. Best and Weiss were aware of the existence of the pipes and tanks in the plant. They also knew of the general nature of the manufacturing process that had been carried on by U.S. Steel in the plant, and they were informed during inspection that the tanks were used for the transfer, storage and mixture of materials in the manufacturing process. They did not inquire, nor were they informed by U.S. Steel, of the nature of the materials that had been in the pipes and tanks. The record also establishes that some time after the production in the plant had ceased early in 1967, U.S. Steel had had the liquid material removed from the pipes and tanks.

Admittedly, there may have been some potential harm from the residue of liquids in the pipes and tanks when they were ignited by some outside or independent agency. In this case, the material was apparently ignited by an employee of Wager, the contractor who had been employed to remove the equipment. Nothing in the record, however, indicates that there was any explosion. Best stated in his deposition that he did not know what caused the fire and he was not sure how it started. He had talked to an adjuster, the fire chief, and Wager about the fire. He was asked on his deposition:

“Do you know whether any determination has ever been made in any manner by anyone as to whether or not flammable liquids were involved in the cause of this fire?”

Best replied:

“Not to my knowledge. I don’t recall anything like that.”

We do not accept U.S. Steel’s argument that the conveyance of the property “as is” is sufficient to exculpate the vendor and to justify the entry of the summary judgment order for U.S. Steel. We do find, however, that the conveyance “as is” is an important factor under the facts in this case in determining whether or not the exception created by section 353 to the general rule of nonliability of the vendor is applicable.

Recovery under section 353 of the Restatement (Second) is authorized only in situations where the vendor fails to disclose a condition which involves an unreasonable risk. The mere presence of a residue of combustible liquids or material sealed in pipes or tanks, which only became ignited through the intervention of some outside agency, did not constitute an unreasonable risk which would permit the vendee to recover under section 353, where the knowledgeable vendee, after several inspections of the property, agreed, for a reduced price, to take the property “as is.”

The complaint does not charge that U.S. Steel concealed the condition that the plaintiffs allege existed on the premises, but only that U.S. Steel “[f] ailed to advise” Century of the presence of flammable liquids. Section 353 of the Restatement (Second) covers two different kinds of conduct of the vendor. If the vendor “actively conceals the condition” then the liability stated in subsection 1 of section 353 continues until the vendee has discovered the condition and has a reasonable opportunity to take effective precautions against it. As noted, the allegations of the complaint do not charge that the defendant concealed the condition, and the affidavits, interrogatories and depositions do not establish any concealment. The second situation covered by section 353 involves cases where the vendor “fails to disclose” a condition which involves an unreasonable risk. In such a case it is provided that the liability of the vendor “continues only until the vendee has had a reasonable opportunity to discover the condition and to take such precautions” as are necessary.

In Sparling v. Peabody Coal Co. (1974), 59 Ill. 2d 491, this court held that on the record of that case it was a question of fact for the jury to decide whether the vendee had a reasonable opportunity to discover the dangerous condition and to take effective precautions against it. In Sparling the vendee had purchased a 22y2-acre tract of land from a coal company. The land had been used for coal-mining operations. The vendee had inspected the property before he bought it, but he thought that the smell of sulfur came from an open mine shaft. He stated that he did not know that it came from a burning slack pile and that he did not know that a slack pile would bum beneath the surface. It was this burning slack pile which constituted the dangerous condition into which his daughter fell. After the purchase of the land, the vendee used the property for a junkyard and did not use that area in the vicinity of the mine and the slack pile and had no occasion to go near it. He was afraid of the open mine shaft and never inspected to see if it was the source of the sulfur odor which he occasionally smelled when the wind blew from the direction of the shaft.

The facts in our case are far different. As indicated above, the vendee here, and its officers, attorneys, and employees, were experienced and knowledgeable in the buying, selling, and dismantling of commercial plants. Both Weiss and Best had inspected the plant about four times prior to its purchase. They were informed of the use that had been made of the pipes and tanks located on the premises. Weiss stated that he had also inspected the plant about six times between the time of its purchase and the time of the fire some 2V2 months later. Best stated that he was in the plant two or three times each week during that interval. Best went over the premises with Wager several times and arranged for the demolition and remodeling of the premises. Mr. Manning, an employee of another affiliated company, inspected the equipment to determine what equipment could be sold. In fact, some of the equipment was dismantled and sold prior to the fire. Also, Wager employees had been working on the demolition and remodeling project for a week before the fire. Under these facts, as contrasted with the record in Sparling, we must conclude as a matter of law that the vendee had a reasonable opportunity to discover the dangerous condition complained of and to take the necessary precautionary measures to protect against it.

In our opinion the appellate court improperly reversed summary judgment for U.S. Steel with respect to cpunt III (charging willful and wanton conduct by U.S. Steel). The appellate court apparently concluded that U.S. Steel’s motion for summary judgment was directed only to the negligence count, count II. We do not agree. Plaintiffs framed both counts on the basis of identical facts, merely substituting “willful and wanton” in count III where the word “negligence” appeared in count II. It is too narrow an interpretation of U.S. Steel’s motion to conclude that it was directed only to one count; the motion satisfactorily dealt with both the factual underpinnings of count II and count III.

The motion was not directed solely to count II but asked for judgment in U.S. Steel’s favor and against the plaintiffs, “dismissing the complaint with prejudice and with costs.” This clearly indicates that not only was U.S. Steel asking for summary judgment as to count II but that plaintiffs’ entire case against U.S. Steel be disposed of and that costs be assessed against them. The order granting the motion for summary judgment ordered “that the plaintiffs take nothing by their said suit, and that defendant United States Steel Corporation go hence without day.” Thus, the order granted U.S. Steel’s prayer to dispose of the entire case and nothing was left pending of either count II or count III. Consequently, the order of the appellate court reversing summary judgment for U.S. Steel as to count III is reversed.

In summary, that portion of the judgment of the appellate court affirming summary judgment as to count II is affirmed, and that portion of the judgment of the appellate court reversing summary judgment as to count III is reversed. The judgment of the circuit court is affirmed.

Appellate court affirmed in part and reversed in part; circuit court affirmed.

GOLDENHERSH and KLUCZYNSKI, JJ., took no part in the consideration or decision of this case.


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    (No. 50196.
    GIVENROD-LIPE, INC., Appellant, v. THE INDUSTRIAL COMMISSION et al.-(Doris Jean Givenrod, Appellee.)

      Opinion filed May 16, 1978.

    KLUCZYNSKI, J., took no part.
    Keefe and De Pauli, of East St. Louis, for appellant.
    Paul M. Caldwell, of Caldwell, Lewis & Troutt, of Benton, for appellee.
   MR. JUSTICE RYAN

delivered the opinion of the court:

The employer, Givenrod-Lipe, Inc., appeals from a judgment of the circuit court of Franklin County, which confirmed the Industrial Commission’s affirmance of an arbitrator’s award for the death of its employee, Clifford C. Givenrod. The sole issue on appeal is whether the decedent’s death arose out of and in the course of his employment.

Givenrod-Lipe, Inc., is an engineering firm with headquarters in Benton. It is engaged as a consulting engineer by the Rend Lake Conservancy District on a retainer basis and performs substantial work for the district in connection with the Rend Lake project. The Rend Lake project, a flood control project, is jointly operated by the conservancy district, the State of Illinois, and the United States Army Corps of Engineers. The firm also has direct business dealings with the Corps of Engineers with regard to other projects, including a substantial Federal survey contract which was finalized shortly after Givenrod’s death.

The decedent was president and a member of the board of Givenrod-Lipe, Inc. Although he was a licensed professional engineer and registered land surveyor, his duties with the firm primarily consisted of the solicitation and promotion of business. At various times of the year, the operators of the Rend Lake project held joint meetings to coordinate their activities, and Givenrod generally attended as a representative of the firm.

The conservancy district scheduled a social dinner meeting on July 16, 1973, in order to introduce the new colonel who was to head the district office of the Corps of Engineers in St. Louis. Although no official business was scheduled, the purpose of the meeting was to get acquainted with the new colonel on a first-name basis in order to facilitate business relations in the future.

The meeting was held at the Perfection Club located on Route 51 south of Du Ouoin, approximately 18 miles from Benton. Twelve to fourteen people attended, including six members of the board of trustees of the conservancy district, the treasurer and the attorney for the district, the decedent, and several members of the Corps of Engineers. According to the usual routine, a round of drinks was to be served, followed by dinner at 7:30 p.m. The only guest to testify before the arbitrator was John Douglas, a member of the board of trustees of the conservancy district. He testified that the decedent was somewhat late due to another business meeting and did not arrive until the guests were about to begin dinner at 7 to 7:30 p.m. Douglas stated that Givenrod attended all of the district’s meetings; that he considered Givenrod’s attendance at this particular meeting to be mandatory, and that, in his opinion, Givenrod had attended in his professional capacity. Douglas testified that he left with two other nondrinkers when the meeting broke up at 9 p.m., or shortly thereafter. Although other people remained at the table, Douglas did not specifically remember seeing Givenrod when he left. There is no evidence that Givenrod had left before Douglas or at what time he did leave.

According to stipulated facts, Givenrod was killed in an automobile accident at 11:05 p.m., four to five miles east of the Perfection Club on Route 14, the most direct route from the club to Benton. His wife filed a claim for compensation on behalf of herself and their three minor children, which resulted in the award previously noted.

The employer argues that the petitioner failed to prove by a preponderance of the evidence that Givenrod’s death arose out of and in the course of his employment. While conceding that the Commission is free to draw reasonable inferences from circumstantial evidence, the employer contends that the Commission cannot speculate or conjecture as to Givenrod’s activities during the IV2- to 2-hour period between the time he was seen at the meeting and the time of his death. The employer cites Cannon Construction Co. v. Industrial Com. (1968), 38 Ill. 2d 584, and Thomas Reed & Son v. Industrial Com. (1967), 36 Ill. 2d 612, in support of this point.

In our opinion, both of those cases are distinguishable. In Cannon, the employee delivered plans to a contractor at 4:45 p.m. in a tavern. He then drank beer, visited another tavern for dinner, and left for home at 9 p.m. At 9:50 p.m., he was killed in an automobile accident. This court held that there was no evidence that he transacted any business for his employer subsequent to 4:45 p.m., and accordingly affirmed the reversal of the award. In Reed, the employee, an electrical foreman, had gone home after work, arriving at 5:45 p.m. After changing his clothes and eating supper, he left again at 9:30 p.m. At about 10:30 p.m., he was seen checking an electrical panel of the restaurant where he had been installing electrical equipment. He was killed in an automobile accident at 12:04 a.m. on the route to his home. This court reversed the Commission’s award, holding that it was based on conjecture and speculation, since there was no evidence that the decedent performed any services for his employer after 10:30 p.m., or as to his activities between 10:30 p.m. and 12:04 a.m. We also noted that there was no evidence that he was authorized or asked to work any overtime, and the owner of the restaurant testified he had not asked the decedent to do any work that night.

In the instant case, the record clearly shows that Givenrod’s attendance at the meeting was in the course of his employment, and that fact is not disputed here. John Douglas’ testimony indicates that Givenrod attended the meeting, but does not show whether he was still there when Douglas left at 9 p.m. While Douglas indicated the meeting itself broke up around 9 p.m. when he and two others left, he also stated that other guests were still seated. The parties to this action also stipulated that the accident occurred on the most direct route from the Perfection Club to Benton, where decedent’s home and office were located. While there is no evidence as to the reasonable travel time between the Perfection Club and Benton, we believe that there was sufficient evidence for the arbitrator and the Industrial Commission to reasonably infer that Givenrod did not depart when Douglas did but stayed at the Perfection Club with the others who had attended the meeting, participating in the social functions which were essentially the reason he was requested to attend the meeting. It could also be reasonably inferred that Givenrod was on his way home from the dinner meeting at the time of his death. It is well established that if an employee is injured during travel to or from other than the normal place of employment, undertaken incidentally to the employment and for the accommodation of the employer, such injuries arise out of and in the course of employment. See Burmeister v. Industrial Com. (1972), 52 Ill. 2d 84; Cannon Construction Co. v. Industrial Com. (1968), 38 Ill. 2d 584; Thomas Reed & Son v. Industrial Com. (1967), 36 Ill. 2d 612; Urban v. Industrial Com. (1966), 34 Ill. 2d 159.

In light of the evidence, we find that the award of the Commission is not contrary to the manifest weight of the evidence and affirm the judgment of the circuit court of Franklin County.

Judgment affirmed.

MR. JUSTICE KLUCZYNSKI took no part in the consideration or decision of this case.