text:
    (No. 52515.
    DEARBORN WHOLESALE GROCERS, INC., Appellant, v. ROBERT M. WHITLER, Director of Revenue, Appellee.

      Opinion filed November 18, 1980.

      Robert R. Tepper, Martin J. Friedman and Mitchell H. Macknin, of Chicago (Rosenthal & Schanfield, of counsel), for appellant.
    William J. Scott, Attorney General, of Springfield (George H. Klumpner, Assistant Attorney General, of counsel), for appellee.
    Harold T. Halfpenny, James F. Flanagan, Louis R. Marchese and Michael T. Reid, of Chicago (Halfpenny, Hahn & Roche, of counsel), for amicus curiae Illinois Wholesaler-Distributors Association.
    John M. Cannon and Susan W. Wanat, of Mid America Legal Foundation, of Chicago, for amici curiae Chicago Association of Commerce and Industry et al.

   MR. JUSTICE WARD

delivered the opinion of the court:

The plaintiff, Dearborn Wholesale Grocers, Inc., filed a complaint for administrative review in the circuit court of Cook County against the defendant, Robert M. Whitler, Director of the Department of Revenue (the Department), to set aside an assessment of taxes claimed to be due under the Retailers’ Occupation Tax Act (Ill. Rev. Stat. 1979, ch. 120, par. 440 et seq.) and the Municipal Retailers’ Occupation Tax Act (Ill. Rev. Stat. 1979, ch. 24, par. 8 — 11—1). The circuit court granted the relief sought, the appellate court reversed (74 Ill. App. 3d 813), and we granted the plaintiff’s petition for leave to appeal under Rule 315 (73 Ill. 2d R. 315). We also granted leave to the Illinois Wholesaler-Distributors Association, the Chicago Association of Commerce and Industry, and the Illinois Manufacturers Association to file briefs amici curiae. Their briefs supported the plaintiff.

In 1975 the Department conducted a field audit of the plaintiff’s revenues from July 1, 1972, to May 31, 1975. The auditor examined the plaintiff’s invoices for three 10-day periods, and on the basis of his examination drew up corrected returns for the total time audited. Entries on the corrected returns show that deductions were allowed for 98.5% of the plaintiff’s gross receipts during that period and that only the balance were treated as taxable sales. The Department issued a notice of tax liability for the delinquency, and the plaintiff filed a protest and requested an administrative hearing. At the close of the hearing the hearing officer recommended a final assessment in the amount of approximately $129,000, and the Department issued a final assessment for that amount.

In addition to the sums claimed to be due under the State and local retailers’ occupation taxes, the assessment included an amount due under the Use Tax Act (Ill. Rev. Stat. 1979, ch. 120, par. 439.1 et seq.). The use tax assessment is not contested. As to deficiencies under the Municipal Retailers’ Occupation Tax Act, that act incorporates by reference all the provisions of the Retailers’ Occupation Tax Act which are pertinent to this case, and only the latter, referred to hereafter as “the Act,” need thus be considered.

At the hearing the Department introduced the corrected returns and the testimony of the auditor who had prepared them as its prima facie case pursuant to section 4 of the Act (Ill. Rev. Stat. 1979, ch. 120, par. 443). The plaintiff then presented testimony from its officers and employees that it made no sales at retail but that all its sales, including those which were the subject of the assessment, were made to retail grocery stores for the purpose of resale.

The plaintiff also introduced the invoices for sales made during the test periods of the audit. Although requested to do so by the auditor, the plaintiff had not made available for inspection any certificates from its customers that the merchandise covered by the invoices had been purchased for resale, and the plaintiff did not produce any such certificates at the hearing. The plaintiff did introduce affidavits by its salesmen, however, that whenever a new account was opened the retailer was required by the plaintiff to complete and sign a form prepared by the plaintiff in which the retailer stated that all merchandise to be purchased by him would be resold. The retailer was also required to furnish the registration number or sales number assigned to him by the Department. A blank copy of the form was attached to each salesman’s affidavit. After being executed by the retailers these forms were returned to the plaintiff, but the completed forms, for reasons not shown by the record, were no longer in the plaintiff’s possession at the time of the audit.

The foregoing evidence by the plaintiff was not controverted, and on the basis of it the hearing officer made a finding that the plaintiff was a wholesale grocer. He nevertheless concluded that the plaintiff’s evidence was insufficient to rebut the Department’s prima facie case, since the plaintiff had not documented the resale character of its individual sales as required by section 2c of the Act (Ill. Rev. Stat. 1979, ch. 120, par. 441c). In reversing the circuit court the appellate court took essentially the same position as that of the hearing examiner.

The plaintiff makes the following contentions on appeal: Since it is not engaged in the business of selling property at retail and since these sales were not made at retail, section 2c is not applicable; if applicable, section 2c does no more than create a presumption of taxability, and that presumption was rebutted by the plaintiff’s evidence; if a failure to comply with section 2c makes the Department’s determination of liability conclusive, then section 2c is unconstitutional; the plaintiff complied with section 2c since that section requires only that certificates of resale be obtained, which was done, not that they be retained until the date of audit so as to be available for inspection at that time.

Similar contentions relating to the construction and the validity of section 2 c were advanced in Calderwood Corp. v. Mahin (1974), 57 Ill. 2d 216. The court disposed of that case on the ground that the plaintiff had failed to exhaust its administrative remedies, however, and the present case is thus the first to consider these issues.

Section 2c, a separate section and not a subdivision of section 2, was added to the Act in 1965 (1965 Ill. Laws 116). As amended in 1967 (1967 Ill. Laws 257), it reads as follows:

“If the purchaser is not registered with the Department as a taxpayer, but claims to be a reseller of the tangible personal property in such a way that such resales are not taxable under this Act or under some other tax law which the Department may administer, such purchaser (except in the case of an out-of-State purchaser who will always resell and deliver the property to his customers outside Illinois) shall apply to the Department for a resale number. Such applicant shall state facts which will show the Department why such applicant is not liable for tax under this Act or under some other tax law which the Department may administer on any of his resales and shall furnish such additional information as the Department may reasonably require.
Upon approval of the application, the Department shall assign a resale number to the applicant and shall certify such number to him. The Department may cancel any such number which is obtained through misrepresentation, or which is used to make a purchase tax-free when the purchase in fact is not a purchase for resale, or which no longer applies because of the purchaser’s having discontinned the making of tax exempt resales of the property.
The Department may restrict the use of the number to one year at a time or to some other definite period if the Department finds it impracticable or otherwise inadvisable to issue such numbers for indefinite periods.
Except as provided hereinabove in this Section, no sale shall be made tax-free on the ground of being a sale for resale unless the purchaser has an active registration number or resale number from the Department and furnishes that number to the seller in connection with certifying to the seller that any sale to such purchaser is nontaxable because of being a sale for resale.”

Section 2 c is complemented by sections 1 and 2 (Ill. Rev. Stat. 1979, ch. 120, pars. 440, 441). The first paragraph of section 2 states:

“A tax is imposed upon persons engaged in the business of selling tangible personal property at retail at the rate of [a prescribed percentage] of the gross receipts from such sales of tangible personal property ***.”

The paragraph goes on to enumerate various exceptions not relevant here.

The first paragraph of section 1 of the Act defines a retail sale as follows:

“ ‘Sale at retail’ means any transfer of the ownership of or title to tangible personal property to a purchaser, for the purpose of use or consumption, and not for the purpose of resale in any form as tangible personal property to the extent not first subjected to a use for which it was purchased, for a valuable consideration: ***.” Ill. Rev. Stat. 1979, ch. 120, par. 440.

The second paragraph also relates to a retail sale. It provides:

“ ‘Sale at retail’ shall be construed to include any transfer of the ownership of or title to tangible personal property to a purchaser, for use or consumption by any other person to whom such purchaser may transfer the tangible personal property without a valuable consideration, and to include any transfer, whether made for or without a valuable consideration, for resale in any form as tangible personal property unless made in compliance with Section 2c of this Act. ” (Emphasis added.) Ill. Rev. Stat. 1979, ch. 120, par. 440.

The italicized portion of the foregoing paragraph was added in 1965 by the same amendment which enacted section 2c.

The position of the appellate court was that the last paragraph of section 2c and the final clause of the second paragraph of section 1, taken together, permit the imposition of the tax upon any person making a sale for resale, even though the sale is at wholesale, if he has not obtained certain information from the purchaser. It is not clear from the opinion of the court whether it is the purchaser’s registration number, his resale number, or a “certificate of resale” which the court believed that the plaintiff was required to obtain. We need not consider what section 2c requires in the way of documentation, however, for we agree with the plaintiff that the Act does not apply to it.

The Act is entitled “An Act in relation to a tax upon persons engaged in the business of selling tangible personal property to purchasers for use or consumption” (1933 Ill. Laws 924), and the same limitation appears in section 1 of the Act. That characterization of the Act formed the basis of the decision in Reif v. Barrett (1933), 355 Ill. 104, sustaining the Act against various constitutional challenges (355 Ill. 104, 122-24), and over the years the court has repeatedly expressed the view that it is not the sale of property but the business of selling it for use or consumption which is the subject of the tax. Revzan v. Nudelman (1938), 370 Ill. 180, 183-84, 186; Fefferman v. Marohn (1951), 408 Ill. 542, 545-46; Modern Dairy Co. v. Department of Revenue (1952), 413 Ill. 55, 65; Central Television Service, Inc., v. Isaacs (1963), 27 Ill. 2d 420, 426.

While the amendments with which we are here concerned do not in terms purport to impose the retailers’ occupation tax upon a wholesaler, that is their effect under the construction given them by the appellate court: A wholesaler, like the plaintiff here, is assessed for a supposed tax deficiency; section 4 makes the Department’s corrected returns presumptively correct; if the wholesaler cannot prove that his sales were for resale by the documentation prescribed by section 2c, then section 1 renders the presumption of liability conclusive. The wholesaler is made liable for the tax despite uncontroverted evidence that he is not engaged in the business of selling property at retail, and indeed makes no retail sales at all.

Such an anomalous result could not occur in the absence of these amendments, for without them the plaintiff’s evidence would have been sufficient to rebut the Department’s prima facie case. (Fashion-Bilt Cloak Manufacturing Co. v. Department of Finance (1943), 383 Ill. 253.) Under our decisions this attempt by indirection to extend the retailers’ occupation tax to one not engaged in that business would invalidate the amendments.

These amendments were enacted in 1965 and 1967, and they are therefore subject to the provisions of the Illinois Constitution of 1870. (People ex re. Hanrahan v. Caliendo (1971), 50 Ill. 2d 72, 76.) Article 4, section 13, of the 1870 Constitution limits the contents of an act to the subject expressed in its title. (International Business Machines Corp. v. Department of Revenue (1962), 25 Ill. 2d 503.) For this reason we held invalid in that case an amendment to the Act which expanded the definition of “sale at retail” so as to subject to the retailers’ occupation tax a lease of personal property as opposed to a sale. Central Television Service, Inc. v. Isaacs (1963), 27 Ill. 2d 420, again, held invalid amendments which declared that persons engaged in certain service occupations should be deemed to be engaged in the business of selling personal property. And in Stolze Lumber Co. v. Stratton (1944), 386 Ill. 334, overruled on other grounds in Modern Dairy Co. v. Department of Revenue (1952), 413 Ill. 55, an amendment viewed by the court as extending the Act from the business of selling at retail to that of selling at wholesale was also declared unconstitutional.

A related consideration is that by limiting the tax to sales at the retail tax level the legislature avoided the multiple taxation which would result if sales at every level of the distributive process were taxed. (Modern Dairy Co. v. Department of Revenue (1952), 413 Ill. 55, 65.) There is nothing in the record to suggest that the customers of the plaintiff have not paid the tax which the Department now seeks to recover from the plaintiff.

If section 2c is construed as applying only to retailers, the problems just discussed are eliminated. Analysis of the section discloses that such a construction is indeed the correct one. The key term in the section is “purchaser,” which is defined in the Act as “anyone who, through a sale at retail, acquires the ownership or title to tangible personal property for a valuable consideration.” (Emphasis added.) (Ill. Rev. Stat. 1979, ch. 120, par. 440.) The plaintiff’s customers are plainly not “purchasers” from it in the sense in which the Act defines that term, and it is not the transactions between the plaintiff and its customers at which the section is directed.

The apparent purpose of section 2c is rather to provide a means of verifying a claim made by a person subject to the Act as a retailer that a particular sale by him is exempt from tax because the purchaser is not himself the ultimate user or consumer of the property. Situations of that sort have arisen, for example, where the purchaser is a hospital and the property is purchased for the use of its patients. (See, e.g., Modern Dairy Co. v. Department of Revenue (1952), 413 Ill. 55; Burrows Co. v. Hollingsworth (1953), 415 Ill. 202). In such a case the hospital, since it is not engaged in the business of selling property at retail, would not hold a registration number from the Department (Ill. Rev. Stat. 1979, ch. 120, par. 441a). The requirement made by section 2c that the retailer secure a certificate of resale from the hospital would furnish a means of verifying that the hospital’s purchase was indeed for resale.

The Department contends that the fourth and fifth paragraphs of section 7 (Ill. Rev. Stat. 1979, ch. 120, par. 446), although not cited by the appellate court, support its decision. Section 7 relates to records which must be maintained by taxpayers, and specifies the kind of documents and the information which they must contain if deductions claimed on a tax return for sales for resale are to be allowed. The fourth and fifth paragraphs, which were added in 1967 (1967 Ill. Laws 258), provide:

“Except in the case of a sale to a purchaser who will always resell and deliver the property to his customers outside Illinois, anyone claiming that he has made a nontaxable sale for resale in some form as tangible personal property shall also keep a record of the purchaser’s registration number or resale number with the Department.
It shall be presumed that all sales of tangible personal property are subject to tax under this Act until the contrary is established, and the burden of proving that a transaction is not taxable hereunder shall be upon the person who would be required to remit the tax to the Department if such transaction is taxable. *** ”

Section 7 is directed to persons engaged in the business of selling tangible personal property at retail, and section 3 (Ill. Rev. Stat. 1979, ch. 120, par. 442), the provision which requires the filing of returns, is similarly limited. For that reason and for the reasons given in the previous discussion of section 2c, the reference in section 7 to “all sales of tangible personal property” must be construed to mean sales by persons engaged in the business of making such sales at retail.

In its brief the Department also cites Copilevitz v. Department of Revenue (1968), 41 Ill. 2d 154, as having held “the statutory requirement of a resale certificate was mandatory to gain entitlement to the sale for resale exemption.” Copilevitz did not so hold. The decision there did not rest on the taxpayer’s failure to obtain a resale certificate but on his failure to produce evidence of any kind whatsoever that certain unreported receipts originated in sales for resale. The transactions, moreover, took place over 10 years before section 2c was enacted, and the taxpayer was a retailer.

For the reasons given in this opinion the judgment of the appellate court is reversed and that of the circuit court is affirmed.

Appellate court reversed; circuit court affirmed.


source: Caselaw Access Project

author: MR. JUSTICE MORAN

license: Public Domain

text:
    (No. 53573.

      In re ROBERT J. McDONNELL, Attorney, Petitioner.

      Opinion filed November 18, 1980.

      Disciplinary proceeding.
    John C. O’Malley, of Chicago, for the Administrator of the Attorney Registration and Disciplinary Commission.
    William J. Martin and Robert A. Merrick, Jr., of Chicago, for petitioner.
   MR. JUSTICE MORAN

delivered the opinion of the court:

On March 26, 1969, this court allowed the motion of petitioner, Robert J. McDonnell, to strike his name from the roll of attorneys. This action followed his convictions in 1966 for conspiracy to transport stolen securities in interstate commerce and in 1967 for failure to file income tax returns for the years 1960 through 1964 inclusive. In 1972 petitioner filed, pursuant to Supreme Court Rule 767 (73 Ill. 2d R. 767), his first motion for reinstatement, which was denied. On June 26, 1978, petitioner filed the present petition for reinstatement. A panel for the Hearing Board of the Attorney Registration and Disciplinary Commission recommended that the petition for reinstatement be allowed. The Administrator filed exceptions, and the Review Board remanded the cause to the panel to adduce additional evidence on rehabilitation. The panel affirmed its recommendation that the petitioner be reinstated. A majority of the Review Board recommended that the petition for reinstatement be denied.

At the first hearing before the panel, held on March 15, 1979, petitioner testified that, during the period in which the offenses were committed, he was a criminal lawyer trying cases which attracted considerable public attention. Petitioner admitted that he was not mature at the time and had “a lot of free time.” Consequently, he fell into “the death trap that many lawyers fall in” of going “out drinking” or “to the races” instead of returning to his office. He developed a serious drinking problem. He failed to keep accurate accounts and records of his business, which finally led to his failure to file income tax returns.

Although petitioner acknowledged his conviction for conspiracy, he stated that he had not been guilty of the offense. Rather, he stated he was guilty of “bad judgment and association.” The conviction stemmed from petitioner’s meeting with several clients who were involved with stolen money orders valued at $10,000.

Petitioner testified that, following his release from Federal custody in 1970, he was involved in establishing a medical center on the south side of Chicago. In 1971, the S. A. Healy Company, a firm founded by his uncle and operated by his family, employed him at a yearly salary of approximately $9,000. He stated that he was not proud of the fact that this position was a “sinecure.” Petitioner received a number of interest-free loans from the S. A. Healy Company, amounting to $100,000. He explained that these loans were an advance on a $177,000 inheritance from a deceased uncle whose estate was pending in probate court. These loans were used by petitioner to invest in various projects, including pure-water development, a used-car lot, and an export company. From 1970 through 1974 petitioner had made monthly payments of $100 to the U.S. Internal Revenue Service to repay his tax liability. He explained that he had discontinued these payments on the advice of his attorney, pending resolution of an objection to tax liens which would be resolved “in the very near future.”

The petitioner had been hospitalized for treatment of an overdose of drugs for four days in January of 1977. He explained that this was a period of temporary severe depression, brought on by drinking, in which he attempted suicide. He stated, “I would say I slipped, that is all.” He commented, “I take a drink occasionally.”

Petitioner stated that he has kept abreast of legal developments by his contacts with other attorneys and judges and by reading legal advance sheets regularly. He recognizes his past mistakes, feels he has now matured, and believes he has overcome his drinking problem. If reinstated, petitioner would accept a position with a firm which would not involve the collection of money or the accounting of money, areas which had caused him problems in the past. He also pledged to devote 25% of his time to the representation of indigents.

A written report from Dr. John R. Adams was admitted into evidence. Dr. Adams stated that the briefness of petitioner’s January 1977 hospitalization was a sign of his strength. He also stated his belief that petitioner had overcome his drinking problem, as shown by his continued involvement with Alcoholics Anonymous. Dr. Adams attested to petitioner’s competency to resume his former responsbilities.

Sam Adam, an attorney, testified that he had known him since 1962 and that he regularly discussed recent developments in law with him. In his opinion, the petitioner’s reputation' for honesty and integrity is impeccable. Adam also stated that he would ask the petitioner to become affiliated with his firm if he were to be reinstated.

James Doherty, public defender of Cook County, also testified as a character witness. He stated that he had been acquainted with petitioner since 1945 and had always considered him to have been a good lawyer. He would have no hesitancy in recommending that petitioner be hired by his office. Doherty stated that petitioner had never betrayed the trust of a client and never would. He testified that petitioner’s reputation for honesty and integrity was good.

The panel, in recommending that the petition for reinstatement be granted, made the following comment in its report:

“[T] here remains a lingering doubt regarding his emotional stablility and his having overcome the drinking problem which occurred at the same time that his difficulty with the Federal government arose.”

In light of the express reservation of the panel, the Review Board remanded the cause to adduce further evidence on the issue of rehabilitation.

A second hearing was scheduled before the panel on January 22, 1980. Dr. John R. Adams testified that plaintiff’s statement that he took an occasional drink was not inconsistent with Dr. Adams’ earlier report in which he stated his belief that petitioner’s drinking problem was under control. It was also his opinion that petitioner is rehabilitated from both a psychiatric and medical standpoint.

Petitioner testified as to three traffic citations issued on January 20, 1978, which were listed in his amended petition. He admitted that he had been charged with driving while intoxicated. However, the charges were dismissed shortly after his arrest when his dinner companions and the manager of the restaurant where he had dined testified that he had not taken an alcoholic drink that evening.

The panel again recommended that petitioner be reinstated. However, the Review Board’s report recommended that the petition for reinstatement be denied.

In a petition for reinstatement to the roll of attorneys, the petitioner has the burden of introducing evidence of his rehabilitation. (In re Nesselson (1979), 76 Ill. 2d 135, 138; In re Starr (1976), 64 Ill. 2d 407, 415; In re Thomas (1979), 76 Ill. 2d 185, 189.) “Rehabilitation, the most important consideration in reinstatement proceedings, is a matter of one’s ‘return’ to a beneficial, constructive and trustworthy role.” (In re Wigoda (1979), 77 Ill. 2d 154, 159.) Such must be established by clear and convincing evidence. In re Wigoda (1979), 77 Ill. 2d 154, 158; In re Starr (1976), 64 Ill. 2d 407, 415.

The Review Board, in its report, expressed doubt over the petitioner’s assertion that his drinking problem is now resolved. This same concern prompted the Review Board to remand the cause to the panel for additional evidence on the subject. On remand, Dr. Adams testified that petitioner has resolved his alcoholism and that his testimony that he takes an occasional drink is not inconsistent with his particular type of alcohol problem. Additionally, it has been shown by the testimony of both the petitioner and Dr. Adams that petitioner regularly attends meetings of Alcoholics Anonymous.

The Review Board also criticized petitioner’s assertion that, if reinstated, he would return to the field of criminal law. The Review Board remarked, “He will not be removing himself from the same circumstances and temptations that got him involved with criminal conspiracy in the first instance.” However, petitioner stated that his position with Sam Adam would be one in which he would not handle money or be involved with bookkeeping, the areas which he admitted caused him problems. He would also be paid on a straight salary basis. Moreover, petitioner expressed his intention to devote 25% of his time to the representation of indigents. We do not think it is reasonable to expect a former criminal attorney to ignore his considerable experience and knowledge in his specialty to delve into another area of law in order to qualify for reinstatement.

The Review Board also criticized plaintiff’s failure to pay his tax liabilities with the government. The petitioner testified that he had made payments of $100 per month from 1970 through 1974 to the government to repay his tax debt. In 1974, plaintiff’s attorney advised him to stop such payments until objections filed in his behalf could be resolved. The petitioner cites In re Thomas (1979), 76 Ill. 2d 185, for the proposition that restitution is not essential to the granting of reinstatement. In that case, the petitioner had been indicted and charged with using the mails to defraud several insurance companies. The charges stemmed from petitioner’s practice of purchasing personal injury cases from solicitors. The Review Board recommended that the petition for reinstatement be denied because petitioner had failed to make restitution to the clients defrauded. The petitioner stated that more than 10 years had elapsed since he had dealt with the clients to whom the Review Board would require him to make restitution. He stated that he no longer had files or any other means to contact these people and, thus, restitution was impossible. The court stated:

“Although whether restitution has been made is relevant in determining whether a disbarred attorney has been rehabilitated, it is not the controlling consideration. *** Under these circumstances petitioner’s failure to show an effort to make restitution does not serve to preclude his being reinstated.” In re Thomas (1979), 76 Ill. 2d 185, 191.

In the present case, the petitioner stated that the final resolution of his tax liability would be forthcoming in the near future. It is obvious that petitioner was sincere in his attempted repayment, as evidenced by four years of monthly payments. He should not be denied reinstatement for the exercise of his right under the law to contest the amount of tax liability or the liens placed on his property as a result thereof.

The Review Board points out that petitioner received $100,000 in loans from S. A. Healy Company and yet has not resolved his tax liabilities. It is obvious that these loans were used by petitioner in several attempts to establish a new career in the business world. More important, such loans are to be repaid by the petitioner’s $177,000 inheritance from his uncle whdse estate is now in probate.

Petitioner has expressed remorse concerning his past mistakes and, we believe, is sincere in his efforts to change his former style of living. We find, therefore, that petitioner has produced sufficient evidence to prove himself rehabilitated and again fit to practice law in this State. The petition for reinstatement to the roll of attorneys is therefore granted.

Petitioner reinstated.


author: MR. JUSTICE RYAN

text:
    (No. 53443.

      In re HERBERT ZAHN, Attorney, Petitioner.

      Opinion filed November 18, 1980.

    Disciplinary proceeding.

      Mary M. Conrad, of Chicago, for the Administrator of the Attorney Registration and Disciplinary Commission.
    George B. Collins, of Collins & Amos, of Chicago, for petitioner.
   MR. JUSTICE RYAN

delivered the opinion of the court:

The petitioner, Herbert Zahn, seeks to be reinstated to the roll of attorneys admitted to practice law in Illinois. He filed a petition for reinstatement pursuant to our Rule 767. (73 Ill. 2d R. 767.) Zahn was licensed to practice law in Illinois in 1953. He was disbarred in 1970. The amended complaint which was filed in the disciplinary proceeding had charged Zahn with the misappropriation and conversion to his own use of certain monies of three clients. It also charged Zahn with having commingled the funds of one of the clients. The amount of the money involved was over $30,000. Zahn was disbarred on October 2, 1970. He did not appear at the disciplinary proceeding and did not later contest the recommendation of the Hearing Board of the Attorney Registration and Disciplinary Commission. On July 23, 1970, the Du Page County State’s Attorney caused to be issued a four-count indictment charging the petitioner with theft. The theft charge involved the use of a fourth client’s funds. Zahn entered a plea of guilty to the charge and, on October 16, 1970, was sentenced to a 3-year term of probation. The probation order included a requirement that the petitioner seek psychiatric or psychological counseling. Zahn complied with the terms of the probation order. He made full restitution of all four clients’ misappropriated funds. He also sought psychological counseling. Zahn continued to participate in the counseling for 6 years. Due to the petitioner’s successful compliance with the terms of his probation, he was discharged early from the supervision of the court on June 20, 1973.

On May 7, 1979, Zahn filed his petition for reinstatement. At the reinstatement hearing before the Hearing Board, Constantino Salios, a pastor and longtime acquaintance of the Zahn family, testified as to the petitioner’s dramatic improvement in character. He described Zahn’s personality before the disbarment in negative terms: a strongly opinionated individual who seemed to have an immature relationship with his family. According to the pastor, Zahn had matured in the last 3 years; that is, he appeared to have become a warmer individual who was better able to acknowledge and assume responsibility. Dunstan Staas, a brother-in-law of the petitioner, also testified. Staas was a certified public accountant and the vice-president of Pullman, Inc. He stated that up until 1970 Zahn was a troubled person who was unable to relate to others. Staas also described Zahn as being unable to handle himself and his financial affairs. He then described his brother-in-law as he has appeared in recent years: “a warm, compassionate, loving human being.” He testified that Zahn had accepted blame for the acts leading to the disbarment and that he was repentant for his conduct. Staas finally stated that he believed Zahn to be, without question, a fit person to practice law. The petitioner’s wife, Mary Lou Zahn, a senior student at the Northern Illinois University school of law, also testified on her husband’s behalf. She, too, related the progressive character improvement in the petitioner since his disbarment. She stated that prior to October 1970 Zahn had been a poor father and husband. In addition, he was not proficient at handling his financial affairs. According to Mrs. Zahn, the petitioner has since become more realistic with finances and able to face up to his problems. She testified that Zahn had considered filing for reinstatement on two prior occasions. He was not, however, sufficiently motivated to file the necessary documents. Mrs. Zahn stated that she regarded the fact that her husband was able to finally bring his petition before the Hearing Board as an indication that he had made a tremendous step toward facing up to his responsibilities. Finally, the petitioner testified. He stated that the acts causing his disbarment were unjustifiable. He testified that he stopped practicing law immediately upon being disbarred, and he described the various jobs he held thereafter. The record indicates that Zahn worked at several straight-commission sales jobs, as well as at some temporary jobs with built-in termination. On occasion, Zahn would work one job during the day and another during the evening in an attempt to meet his financial responsibilities. Zahn also testified as to the existence of several judgments pending against him and expressed his feeling of a moral obligation to pay the amounts due, when financially able, with the exception of one disputed claim. Zahn also expressed his reluctance to declare bankruptcy as an alternative to repayment of the debts. The petitioner testified as to what he perceived his personality flaws to be which prompted his unethical and illegal conduct. He stated that he has dealt effectively with the inner turmoil which caused his prior behavior and would now be incapable of doing such acts. Zahn stated that prior to his disbarment, he always commingled his clients’ funds. He testified that if he were reinstated, he would always put his clients’ funds in a separate escrow account, and he expressed an awareness as to the appropriate procedure to be followed in the handling of such an account.

The petitioner was the final witness to testify in support of reinstatement, and no witnesses were presented by the Commission. The Hearing Board recommended that Zahn be reinstated, finding that he demonstrated clearly and convincingly that he has been sufficiently rehabilitated. No exceptions to this recommendation were filed. The Review Board of the Commission, based upon an examination of the transcript of the reinstatement proceeding conducted before the Hearing Board, recommended that Zahn’s petition be denied. According to the Review Board, Zahn failed to demonstrate the degree of rehabilitation and current character fitness which would warrant reinstatement. This finding was based upon the following: Zahn failed to fully disclose all details regarding his various jobs and the pending judgments entered against him in his reinstatement petition; he failed to satisfy the numerous judgments entered against him; and the petitioner failed to obtain permanent employment subsequent to his disbarment. While the petitioner concedes that certain details were inadvertently omitted from his petition for reinstatement, he maintains that such information was later provided and that there were no misrepresentations made at the hearing. Zahn also asserts that the numerosity of the positions held during his disbarment period should not be a factor construed as indicative of a lack of rehabilitation. Finally, the petitioner contends that the Review Board erred in its adverse finding as to Zahn’s failure to repay his debts.

Disbarment is a disciplinary sanction imposed to maintain the integrity of the legal profession, safeguard the public, and keep the administration of justice free from reproach. (In re Wonais (1979), 78 Ill. 2d 121, 124; In re Thomas (1979), 76 Ill. 2d 185, 189; In re LaPinska (1978), 72 Ill. 2d 461, 473.) It is the petitioner’s burden to prove, by clear and convincing evidence, sufficient rehabilitation and fitness to practice law before he can be reinstated. (In re Wigoda (1979), 77 Ill. 2d 154, 158; In re Thomas (1979), 76 Ill. 2d 185, 189; In re Starr (1976), 64 Ill. 2d 407, 415.) We recognize that each disciplinary case brings forth a unique set of facts. (In re Clayter (1980), 78 Ill. 2d 276, 283.) While findings and recommendations of the Hearing Board and the Review Board are given consideration (see In re Wigoda (1979), 77 Ill. 2d 154, 158-59), the ultimate responsibility for the determination and imposition of attorney discipline lies with this court. In re Clayter (1980), 78 Ill. 2d 276, 282; In re Leonard (1976), 64 Ill. 2d 398, 406; In re Wyatt (1972), 53 Ill. 2d 44, 45.

After a review of the record of the proceeding before the Hearing Board, we find that the petitioner has demonstrated clearly and convincingly that he has been sufficiently rehabilitated and that he is a fit person to practice law. We do not deem the findings of the Review Board to militate against such a finding. First, we do not find the failure of Zahn in this case to include in his reinstatement petition certain information required and specified by Attorney Registration and Disciplinary Commission Rule 11.1(8) as warranting a contrary result. This case differs from In re Starr (1976), 64 Ill. 2d 407, 416-17, where we concluded that Starr, by stating in his petition for reinstatement that he had no outstanding obligations or judgments, had falsely represented his state of indebtedness. The omissions in our case were objected to by the Administrator of the Commission, and such objections were responded to by the petitioner and the omissions were supplied. At the outset of the hearing, the Commission, as well as the petitioner, agreed that there existed no factual questions in dispute beyond those objected to and answered. We do not find the petitioner’s omission of such information to have been intentional or of such a nature as to be indicative of any negative moral character.

Similarly, we do not deem the petitioner’s failure to repay his debts to be a bar to his reinstatement. In fact, we view the petitioner’s liquidation of several outstanding obligations as a commendable effort in light of petitioner’s employment history and resultant limited income since his disbarment. At the hearing, Zahn offered into evidence documents indicating the release and satisfaction of two judgments entered against him which totaled well over $22,000. He has, therefore, paid two of the judgments entered against him. We also note with approval that petitioner made prompt and complete restitution of misappropriated funds. While several judgments remain unsatisfied, we consider the petitioner’s expressed willingness to repay these debts when he is financially able and his reluctance to declare bankruptcy as indicative of rehabilitation and fitness to practice law. We therefore do not concur with the Review Board’s finding that the failure to repay the debts indicates insufficient rehabilitation for reinstatement.

Finally, we do not share the Review Board’s concern about the petitioner’s employment history subsequent to the disbarment. He worked a multitude of straight-commission jobs in order to support his family. Zahn was not successful in some of his salesman endeavors. However, we do not consider these failures to be indicative of a lack of rehabilitation or fitness to practice law. In fact, we commend Zahn in his repeated employment efforts. We view Zahn’s employment history as reflective of his attempt to “scratch for a living.”

We conclude that Zahn has demonstrated, by clear and convincing evidence, that he is sufficiently rehabilitated and that he is fit to practice law in Illinois. Accordingly, the petition for reinstatement to the roll of attorneys in this State is hereby granted.

Petitioner reinstated.


author: MR. JUSTICE UNDERWOOD

text:
    (No. 53460.
    EUGENE LEE et al., Appellants, v. THE INDUSTRIAL COMMISSION et al. (Jami R. Kennedy, Appellee).

      Opinion filed November 18, 1980.

    Peter F. Ferracuti & Associates, of Ottawa (Eric B. Deobler, of counsel), for appellants.
    Hoffman & Mueller, of Ottawa (Melvin H. Hoffman, of counsel), for appellee.
   MR. JUSTICE UNDERWOOD

delivered the opinion of the court:

In this workmen’s compensation case respondents, Eugene Lee and Jack Onofrey, partners doing business as Lejac’s, appeal directly to this court under Supreme Court Rule 302(a) (73 Ill. 2d R. 302(a)). They seek review of an order of the circuit court of La Salle County quashing the writ of certiorari issued to review an award by the Industrial Commission of compensation and penalties to claimant, Jami R. Kennedy, under the Workmen’s Compensation Act (Ill. Rev. Stat. 1977, ch. 48, par. 138.19(f)(1)).

Respondents did not appear at the hearing before the arbitrator. Claimant there testified that on June 17, 1978, while performing her duties as a waitress at respondent’s tavern, she was carrying a pitcher of beer across the dance floor. A piece of metal used to hold the flooring down was “sticking up.” She was wearing sandals and injured her left great toe on the metal. She went to the hospital the following morning, where the remaining part of the great toe nail was removed and stitches taken to close the wound. She could not wear shoes for some four months and was off work until October 17. The arbitrator awarded claimant compensation for 17 3/7 weeks of temporary total incapacity, amounting to $522.87 and $86 for medical expenses.

No payments were made, but respondents apparently sought review by the Commission. No new evidence was there introduced, and the record indicates that oral argument was waived. The Commission affirmed the arbitrator’s award, but added the maximum penalty of $2,500 authorized for unreasonable delay in the payment of weekly compensation benefits during the period of temporary total disability (Ill. Rev. Stat. 1979, ch. 48, par. 138.19(k)), an additional penalty of $261.43, representing 50% of the compensation awarded, for vexatious delay of payment and the institution and carrying on of proceedings which were merely frivolous or for delay (Ill. Rev. Stat. 1979, ch. 48, par. 138.19(k)), $657 in attorney fees because of the vexatious delay and frivolous defenses (Ill. Rev. Stat. 1979, ch. 48, par. 138.16), and interest on the arbitrator’s award (Ill. Rev. Stat. 1979, ch. 48, par. 138.19(n)).

Respondents sought certiorari from the circuit court, filing a bond which one of the partners signed as principal and the other signed a surety. Claimant moved to dismiss on the ground the partners were improperly acting in both capacities and that a bond in proper form was jurisdictional. That motion was allowed, and respondents’ subsequent tender of a bond with the two partners as principals and a third person as surety was refused. Respondents’ motion to vacate the order quashing the writ of certiorari was likewise denied, and this appeal followed.

Respondents assert the sole issue here is the propriety of the trial court’s order quashing the writ. Claimant urges that we are without jurisdiction since that order was entered March 13, 1980, and notice of appeal was not filed until May 27. This argument is without merit. A post-trial motion was filed April 11 and denied May 9. Within the 30-day period thereafter, a notice of appeal was filed. It was timely. Brady v. Industrial Com. (1970), 45 Ill. 2d 469; Young v. Madden (1960), 20 Ill. 2d 506.

Claimant and the trial court have relied heavily upon Coultas v. Industrial Com. (1964), 31 Ill. 2d 527, in which this court held a bond which was not signed by the party against whom the award had been entered was insufficient to confer jurisdiction upon the circuit court. This case, of course, differs in that one of the two partner-respondents did sign the original bond. In Peter H. Clark Lodge No. 483 v. Industrial Com. (1971), 48 Ill. 2d 64, the employer seeking review failed to exhibit to the circuit court clerk a receipt showing payment of the cost of the record. In view of the express command of the statute that “no praecipe for a writ of certiorari may be filed and no writ of certiorari shall issue” unless the receipt were produced and exhibited (Ill. Rev. Stat. 1969, ch. 48, par. 138.19(f)), our court held the circuit court did not acquire jurisdiction. We do not regard that holding as persuasive here. Nor do we regard the holding in Firestone Tire & Rubber Co. v. Industrial Com. (1979), 74 Ill. 2d 269, that failure to file a bond deprives the trial court of jurisdiction as apposite here since respondents did file a bond, although its form was irregular.

Section 19(f)(2) of the Workmen’s Compensation Act in pertinent part provides:

“No such writ of certiorari shall issue unless the one against whom the Commission shall have rendered an award for the payment of money shall upon the filing of his praecipe for such writ file with the clerk of the court a bond conditioned that if he shall not successfully prosecute the writ, he will pay the award and the costs of the proceedings in the courts. The amount of the bond shall be fixed by any member of the Commission and the surety or sureties of the bond shall be approved by the clerk of the court. The acceptance of the bond by the clerk of the court shall constitute evidence of the approval of the bond.” (Ill. Rev. Stat. 1977, ch. 48, par. 138.19(f)(2).)

The original bond was apparently accepted and filed by the clerk of the circuit court, thus evidencing its approval by him. Its form and sufficiency were thereafter attacked by claimant’s motion to quash the writ of certiorari which was allowed. Respondents’ subsequent tender of a bond in proper form in connection with its motion to vacate the order quashing the writ should have, in our judgment, been accepted and the sufficiency of the surety on that bond determined.

This court’s statements in Smith v. Estate of Womack (1957), 12 Ill. 2d 315, and Republic Steel Corp. v. Industrial Com. (1964), 30 Ill. 2d 311, are apposite here. In Smith the appellant in a probate case had failed to give notice, as specifically required by statute, of the time when his appeal bond would be presented to the court for approval. The court, in holding the requirement nonjurisdictional, stated:

“In construing and applying statutes relating to jurisdiction there must be substantial compliance with the provisions of the statute conferring jurisdiction on the court, but the construction is not to be so narrow or technical as to defeat the intention of the act or the beneficial results thereof, where all material provisions of the statute have been complied with. (Hopkins v. Gifford, 309 Ill. 363; Kennedy v. Borah, 226 Ill. 243.) The courts have always been liberal in construing the appeal statute prior to the amendment here involved. In Mundy v. Mundy, 230 Ill. App. 266, the court said that almost any attempt made in good faith to execute an appeal bond requires the courts to allow such amendment as will obviate the imperfection. In construing the Civil Practice Act the courts have held that while that act requires that notice be served on the appellee of the taking of an appeal to the Appellate or Supreme Court, and while the statutes or rules have long required notifying an appellee of the filing of a praecipe for record, such steps are not jurisdictional. People ex rel. Sandberg v. Grabs, 373 Ill. 423; Rowan v. Matanky, 348 Ill. App. 296.” 12 Ill. 2d 315, 317.

In Republic Steel this court overruled its earlier holding in Village of Glencoe v. Industrial Com. (1933), 354 Ill. 190, that the circuit clerk’s failure to approve the bond in writing deprived the court of jurisdiction, noting:

“The tendency is to simplify procedure, to honor substance over form and to prevent technicalities from depriving a party of the right to be heard. This is exemplified by the Practice Act, which became effective just a few days after the Glencoe decision became final, and its liberal interpretation by the courts since that time.
The statute does not require written approval by the clerk on the face or any other part of the bond. Where, as here, the clerk accepts a bond tendered to him and files it without objection, there is a presumption of approval and it is unnecessary for him to indorse his approval upon the bond to satisfy the statute. The holding in Village of Glencoe v. Industrial Com. 354 Ill. 190, is overruled in so far as it requires formal written approval of a bond by the clerk. This view is more nearly in accord with the holdings relative to approval of bonds on appeal, (Waldo v. Averett, I Scam. 487; Commerce Vault Co. v. Hurd, 73 Ill. App. 107; Barker v. Smith, 90 Ill. App. 595; Smith v. Ammen, 101 Ill. App. 144,) which indicate that acceptance of the bond by the proper officer constitutes approval of the bond.” 30 Ill. 2d 311, 313.

We believe, in accordance with the tenor of these cases, that the trial court should have proceeded to determine the sufficiency of the bond tendered in connection with the post-trial motion. If found sufficient, the merits of the appeal should then be considered.

The judgment of the circuit court of La Salle County is accordingly reversed, and the cause remanded with directions.

Reversed and remanded, with directions.


author: MR. JUSTICE CLARK

text:
    (No. 52779.
    COSTAS MAKRIS, Appellant, v. THE INDUSTRIAL COMMISSION et al. (Nabisco, Inc., Appellee).

      Opinion filed November 18, 1980.

      Ronald S. Fishman, of Chicago, for appellant.
    Braun, Lynch, Smith & Strobel, Ltd., of Chicago (Francis J. Lynch, of counsel), for appellee.
   MR. JUSTICE CLARK

delivered the opinion of the court:

This workmen’s compensation case (see Ill. Rev. Stat. 1975, ch. 48, par. 138.1 et seq.) arose out of injuries sustained by Costas Makris on October 14, 1975. The parties stipulated that the only disputed issues before the arbitrator were whether the injuries were compensable under the Act, the nature and extent of those injuries, and the amount of compensation owed.

The portions of the arbitrator’s award pertinent to this appeal were (1) that the claimant was entitled to receive “the sum of $149.20 per week for a period of 71 weeks, that being the period of temporary total incapacity for work, for which compensation is payable”; (2) that claimant should receive “the sum of $149.20 per week for a further period of ISSVk weeks *** for the reason that the injuries sustained caused the permanent and complete loss of use of the right leg to the extent of 40% thereof; of the left leg to the extent of 15% thereof, and of the right arm to the extent of 10% thereof”; and (3) that the claimant was “entitled to have and receive from the Respondent the sum of $15,708.45, being the amount of compensation that has accrued from October 14, 1975, to February 8, 1978, and to the further sum of $3,995.60 for necessary medical, surgical and hospital services ***.” On review the Commission “affirm [ed] and adopt [ed] the decision of the arbitrator” but modified the first two findings excerpted above. The Commission said that claimant (1) was entitled “to have and receive from said respondent the sum of $149.20 per week for a period of 41 weeks (10/14/75 - 7/28/76), that being the period of temporary total incapacity for work, for which compensation is payable” and (2) was entitled only to 90 weeks of additional compensation, “for the reason that the injuries sustained caused the permanent and complete loss of use of the right leg to the extent of 30% thereof; of the left leg to the extent of 15% thereof; the Commission further finds that the petitioner sustained no permanent disability to the right arm.” Claimant filed an appeal in the circuit court of Cook County, which confirmed the Commission’s decision. Claimant has appealed to this court (see 73 Ill. 2d R. 302(a)), contending that the Commission’s failure to find claimant permanently and totally disabled was against the manifest weight of the evidence and, alternatively, that the Commission’s reduction of the arbitrator’s award was against the manifest weight of the evidence. Claimant also contends that the Commission erred in failing to award damages under sections 19(k) and 19(Z) of the Act. See Ill. Rev. Stat. 1975, ch. 48, pars. 138.19(k), 138.19(Z).

Claimant was injured on October 14, 1975, when he was caught and pinned between two garbage trucks, each approximately 10 feet long and 4 feet wide, which were moving along a conveyor belt. His body was pinned from the hips down for about one minute. He was taken by ambulance to a hospital and remained there for two weeks under the treatment of Dr. Richard Corzatt. A fracture of claimant’s left leg required a cast, which was removed November 11, 1975. On December 16, 1975, according to a letter of Dr. Corzatt written to respondent and submitted on this record, “X-rays were obtained of the left leg which revealed the fracture along the proximal shaft of the fibula to be in good position. X rays obtained of the right leg revealed no bone or joint pathology.” According to Dr. Corzatt, claimant “returned on Jan. 26, 1976, at which time he was complaining of pain in the right leg. X rays obtained of the right leg revealed no evidence of bone or joint pathology. There was evidence of vascular calcifications in the region of the anterior and posterior fibial vessels near the right ankle. He was given a muscle relaxant medication and advised to begin wearing a support hose for a sprain of the right calf *** and that he would be able to return to light duty work on Feb. 2, 1976.” Claimant was last seen by Dr. Corzatt on March 23, 1976, when “X rays were obtained of the cervical spine, both shoulders, both hips and the right knee. They revealed no evidence of bone or joint pathology. He was instructed that he could return to full time employment” and that further care under [Dr. Corzatt’s] orthopedic group was no longer necessary and that he should seek a medical work up under the care of his family physician.” It was “not felt that [claimant would] have any permanent disability as a result from the accident sustained on October 15, 1975.”

On March 17, 1976, claimant had been examined by Dr. Prem Pahwa, whose evaluations were submitted on the record by respondent. Dr. Pahwa examined claimant and opined that the left leg fracture had healed well, that “no objective findings except for a circumferential hypesthesia over the right leg extending to the abdomen, which does not fit in any neurological pattern,” supported claimant’s complaints of pain. He also found that the right shoulder “has a full range of motion with no areas of tenderness” and that claimant “should return to work as soon as possible.”

On May 11, 1976, claimant was examined by Dr. Stamler, who, in a letter to claimant’s attorney, stated the complaints of pain, and the results of tests of claimant’s legs and right arm, and who recommended examination by a vascular surgeon due to “the absence of pulsation from the posterior tibia! artery in the right leg.” On June 11, 1976, claimant was again examined by Dr. Pahwa, who measured the results of an examination of claimant’s lumbosacral spine and conducted low-back tests. He said it was very difficult “to evaluate motor power because the patient does not cooperate, but I do not believe there is any true motor weakness.” He also said he believed there was “a great deal of functional overlay and there is no permanent damage caused by this injury and I believe he should return to work.” On July 28, 1976, Dr. Pahwa, after another examination of claimant, stated that he was not “able to find any neurological deficits or vascular deficiency to account for [claimant’s] continuing right leg pain. There are good pulses present bilaterally in the lower legs except for the posterior tibial pulses bilaterally. There is a stocking type of hypesthesia over the right lower leg up to the lower coastal margin and similarly, has a hypesthesia over the whole of the right upper extremity. These do not fit into any known pattern of neurological deficit. *** I certainly feel that no surgical treatment is necessary. I also believe that there is a great deal of functional overlay in this patient.”

Dr. Starkman, testifying for the claimant before the arbitrator, said he had examined the claimant in early July 1976 and had been an attending physician during claimant’s hospitalization from August 16 to August 25, 1976. Dr. Starkman testified, inter alia, that claimant suffered a degree of right-foot dropping which, in his opinion, “very frequently is a permanent injury because of the poor outlook for that nerve generally speaking.” Right-foot dropping is caused by “damage to the peroneal nerve as it goes around the head of the fibula.” In Dr. Stark-man’s opinion, claimant would be hampered from performing manual labor which required claimant to stand on his feet all day, “but he might be able to perform it probably inadequately.” The “inadequate” characterization was stricken from the record upon respondent’s objection, the grounds for which were not stated. Claimant, however, has not preserved this ruling for review, and we therefore do not consider this matter further.

On December 20, 1976, claimant was seen by Dr. Pahwa, who reexamined the lumbosacral spine and conducted more low-back tests. He was “unable to feel the posterior tibial pulses bilaterally,” “[t]he popliteal pulse [was] faintly palpable,” “[t]here [was] good femoral pulsation bilaterally,” and “no true motor weakness.” He said that claimant complained of pain “with every motion of the foot and ankle,” and had “a stocking type of hypesthesia over the right lower extremity”; “[t]he knee reflexes [were] present bilaterally, ‘but’ the ankle reflexes [were] diminished bilaterally.” Dr. Pahwa’s conclusions were:

“On clinical examination, I am unable to determine the state of circulation of the right leg any further than mentioned above. Again, he [claimant] complains of circumferencial hypesthesia over the whole of the right leg, which does not fit into any known pattern of neurological deficit.
Similarly, the patient complains of pain in the right shoulder. Clinically *** it appears to be normal.”

Claimant was readmitted to the hospital on January 22, 1977. The report which was submitted on the record without pertinent objection, was not signed, but Dr. Christalis was listed as the consultant and Drs. Marks and Starkman were listed as attending physicians. Testing revealed no clinical explanation for claimant’s pain.

On February 22, 1977, claimant was examined by Dr. Marshall Matz, who said:

“In summary, we have a 56 year old man, who since October 14, 1975 has alleged pain about the shoulder, low back and both lower extremities and whose neurologic examination fails to reveal any objective findings that would explain his ongoing symptomatology. His EMC is also confusing from a clinical standpoint, as there are no findings to correlate with that laboratory test. In addition on his clinical examination there are a number of manifestations which weigh heavily against the diagnosis of organic disease involving the neuromuscular system. Particular reference is made to the sensory examination which is so bizarre as to raise questions regarding the patient’s veracity. The type of injuries described should not produce this type and degree of complaints for this length of time and if there was involvement of the nervous system, one would certainly expect by this time to see some objective changes that would allow some sort of documentation from an etiologic standpoint. I have no further suggestions from a neurosurgical standpoint and can find nothing on the basis of my clinical examination of this date to preclude Mr. Makris from returning to his previous employment. I have not scheduled further appointments.”

On this record, claimant’s argument that he was entitled to a finding of permanent total disability is not well taken. The Commission’s determination that the several physicians who said that claimant could return to work were correct is not against the manifest weight of the evidence. Nor is the supplemental evidence presented to the Commission, including additional medical opinions and the claimant’s testimony, so compelling as to result in a contrary result. When the experts disagree, the Commission must resolve that conflict, and its decision is generally not disturbed on review. Johns-Manville Products Corp. v. Industrial Com. (1979), 78 Ill. 2d 171, 178; cf. County of Cook v. Industrial Com. (1977), 69 Ill. 2d 10, 18.

Claimant also argues that the arbitrator’s restrictive evidentiary rulings constituted error requiring the Commission’s decision to be overturned. Any alleged error, however, was cured by the Commission on review of the arbitrator’s decision. The Commission did not exclude any relevant information presented, and its decision, therefore, will not be disturbed on this basis.

We next consider the Commission’s decision to eliminate the temporary total disability payments as of July 28, 1976, coincident with Dr. Pahwa’s examination of that date. The arbitrator, in contrast, had ended those payments as of the date of Dr. Matz’s diagnosis, on February 22, 1977.

The development of this case is best characterized as a contest between the credibility of claimant’s subjective complaints and the various medical diagnoses. The term used by Dr. Pahwa to describe claimant’s ailments, functional overlay, not explained on this record or causally related to claimant’s injury, was an ambiguous and perhaps evasive diagnosis (see 3A R. Gray, Attorney’s Textbook of Medicine pars. 80.52(4), 80.52(5) (1980)). Problems in interpreting this diagnosis and in evaluating claimant’s complaints, in a case of this type, are best left to the skill and experience of medical experts and compensation administrators. (See IB A. Larson, Workmen’s Compensation sec. 42.24 (1980); Veritone Co. v. Industrial Com. (1980), 81 Ill. 2d 97.) A witness’ credibility is likewise best resolved by the Commission. (Health & Hospitals Governing Com. v. Industrial Com. (1978), 72 Ill. 2d 263, 273.) Therefore, the Commission’s decision to eliminate temporary total disability payments as of July 28, 1976, is not against the manifest weight of the evidence.

For similar reasons, we will not reverse the Commission’s reduction of the permanent disability percentages and the elimination of the disability award for the claimant’s right shoulder. Dr. Corzatt never noted an injury to the right shoulder. Dr. Stamler could not connect claimant’s right shoulder complaint to the injury. Dr. Pahwa’s reports stated that there was nothing wrong with claimant’s right shoulder. The other permanent disability percentage reductions are also supported by the evidence.

Respondent has requested, in its reply brief, a modification of the award so as to disallow the hospitalization expenses, arguing that the Comjnission could not have intended to allow hospitalization expenses during the period in which temporary total disability payments were denied. In the absence of a cross-appeal, however, this alleged error is not before us. See 73 Ill. 2d R. 303(a); City of Chicago v. Industrial Com. (1974), 59 Ill. 2d 284, 290; Phelps v. Seeley (1954), 3 Ill. 2d 210, 218; Bryant v. Lakeside Gallaries, Inc. (1949), 402 Ill. 466, 471.

Finally, we consider the Commission’s failure to award penalties under sections 19(k) and 19(7) of the Act (Ill. Rev. Stat. 1975, ch. 48, pars. 138.19(k), 138.19(7)). Respondent only terminated the temporary total disability payments after it received expert medical opinions that claimant could return to work. (See Ill. Rev. Stat. 1975, ch. 48, pars. 138.19(k), 138.19(7).) In addition, the dispute over the amount of the award was legitimate; therefore the Commission did not err in refusing to assess a penalty. See generally Mid-America Lines, Inc. v. Industrial Com. (1980), 82 Ill. 2d 47, 61-62, and cases therein cited.

Judgment affirmed.


text:
    (No. 52982.
    THE METHODIST MEDICAL CENTER OF ILLINOIS, Appellant, v. ROBERT L. INGRAM, Township Supervisor, Appellee.

      Opinion filed November 18, 1980.

      Westervelt, Johnson, Nicoll & Keller, of Peoria (James D. Broadway and William E. Defenbaugh, of counsel), for appellant.
    Bernard L. Oltman, of Pekin, for appellee.
    Rex Carr, of Cohn, Carr, Korein, Kunin, Schlichter & Brennan, of East St. Louis, for amicus curiae St. Mary’s Hospital of East St. Louis, Illinois, Inc.
    Harry L. Kinser, Kenneth C. Robbins and Jeffrey W. Maysent, of Chicago (McLaughlin, Kinser & Bryant, of counsel), for amicus curiae Illinois Hospital Association.
   MR. JUSTICE UNDERWOOD

delivered the opinion of the court:

Plaintiff, the Methodist Medical Center of Illinois (hereinafter referred to as the Center), brought this action in the circuit court of Tazewell County against Robert L. Ingram, supervisor of general assistance for Groveland Township, to recover charges of $3,545.80 for medical services which it provided to Robert L. Hunt III, a minor son of Robert L. Hunt, Jr. The circuit court granted plaintiff’s motion for summary judgment. Defendant appealed and the appellate court reversed (78 Ill. App. 3d 944). We granted the Center’s petition for leave to appeal.

The issues in this case arise in connection with the operation of this State’s system of providing aid to the medically indigent as set forth in article VII of the Illinois Public Aid Code (Code) (Ill. Rev. Stat. 1977, ch. 23, par. 7 — 1 et seq.), which requires townships and other local governmental units to assist those unable to finance necessary medical care. Eligibility for assistance is determined in accordance with statewide standards established by the Department of Public Aid (Department) (Ill. Rev. Stat. 1977, ch. 23, pars. 7 — 1, 7 — 2). Section 7 — 2 of the Code also requires that in determining eligibility the amount which the applicant can contribute to the cost of necessary care is to be computed according to departmental standards. For those eligible, assistance can then be given in an amount equal to the difference between the amount which the applicant can contribute and the amount to which the hospital is entitled pursuant to a per diem rate determined by the Department. That per diem rate is at the heart of this controversy. It is apparently computed by the Department pursuant to the provisions of sections 5 — 5 and 5 — 7 of article V of the Code (Ill. Rev. Stat. 1977, ch. 23, pars. 5 — 5, 5 — 7). It is used, however, as a basis for payment of all in-patient hospital care furnished under the Code. A separate computation is made annually for each hospital from data contained in the annual reports filed by each hospital; these reports may be amended quarterly if desired. The per diem rate so computed is somewhat lower than the hospital’s usual and customary charges. Inflation, coupled with the fact that the rate is based upon the hospital’s costs for the preceding year, widens the gap between the per diem rate and the hospital’s customary charges. Aggravating the problem, it is said, is the absence from the article VII system of payments of the year-end two-way reconciliation of accounts which occurs under article V. Federal funds are used and Federal regulations apply to assistance given under article V, which concerns medical care for those already receiving financial assistance under other programs. Those regulations require the Department, in cases where the operating costs of the hospital have not been met, to reimburse the hospital for any deficit (apparently the difference between the per diem rate and a rate sufficient to pay the operating costs). Conversely, if the hospital has been overpaid, it must refund the overpayment to the Department. Under article VII, however, State and local funds are used; if the hospital is overpaid, refund to the State is required; but, if the per diem rate payments are insufficient to cover the actual operating costs of the hospital, no additional reimbursement is made. The resulting deficit spawned this litigation and other litigation pending in other courts of this State.

Article V of the Code is captioned “Medical Assistance.” It is referred to in the briefs as providing a State “Medicaid” program, and its stated purpose is “to provide a program of essential medical care and rehabilitative services for persons receiving basic maintenance grants under this Code and for other persons who are unable, because of inadequate resources, to meet their essential medical needs” (Ill. Rev. Stat. 1977, ch. 23, par. 5 — 1). It seems to be undisputed that sections 5 — 5 and 5 — 7 of article V authorize the Department’s per diem rate for use in connection with medical care and services furnished under that article. Article VII is captioned “Local Aid To The Medically Indigent.” It does not contain the express authority found in section 5 — 5 to “determine the quantity and quality of the medical assistance for which payment will be authorized” (Ill. Rev. Stat. 1977, ch. 23, par. 5 — 5) nor the authority to negotiate fees and rates contained in section 5 — 7 (Ill. Rev. Stat. 1977, ch. 23, par. 5 — 7). It is plaintiff’s position that the per diem rate computed pursuant to the authority contained in article V cannot be applied to hospital charges for care furnished under article VII in the absence from the latter article of the express authority contained in the former. We do not agree.

In this case Robert L. Hunt III, a resident of Groveland Township, received medical care, part of which was of an emergency nature, at the Center from December 26, 1977, to January 12, 1978. His father, Robert L. Hunt, Jr., applied for assistance in paying his son’s bill. The Center forwarded the application to Supervisor Ingram, who determined that the Hunts were qualified for assistance under article VII of the Illinois Public Aid Code (Ill. Rev. Stat. 1977, ch. 23, par. 7 — 1 et seq.), that the 17 days of care at the Center should be reimbursed to the extent of $2,747 (which is, to the nearest dollar, 17 times $161.60, which Ingram believed to be the “per diem” rate specified for the Center in the Department regulations) and that Hunt had “available” resources of $2,156. Ingram tendered the Center $591 in full payment of the bill, after deducting the $2,156 which the Center could obtain from Hunt pursuant to section 11 — 13 of the Code (Ill. Rev. Stat. 1977, ch. 23, par. 11 — 13). Section 11 — 13 bars a supplier who accepts a direct Department payment on behalf of an aid recipient from recovering any additional payment except the amount which the Department’s regulations specify is to be met from the aid recipient’s “available” income and resources. The Center refused to accept Ingram’s payment and instituted this action.

Plaintiff has cited in support of its position only four cases: Sisters of the Third Order of St. Francis v. Groveland Township (1972), 7 Ill. App. 3d 278; Pekin Memorial Hospital v. Shilling (1970), 121 Ill. App. 2d 473; St. John’s Hospital v. Town of Capitol (1966), 75 Ill. App. 2d 222, and Rockford Memorial Hospital Association v. Whaples (1960), 25 Ill. App. 2d 79, none of which discusses the issue here. Plaintiff apparently refers to these four cases because they involve judgments for the full amount of the hospital charges. That is totally unpersuasive, however, for the hospital services in each of those cases were furnished long prior to November 1, 1971, the date upon which use of the per diem rate was apparently first required. Nor do we regard Bio-Medical Laboratories, Inc. v. Trainor (1977), 68 Ill. 2d 540, as indicating the absence of departmental authority to adopt the challenged regulations. We there held the Director of the Department could not suspend vendors from participation in the medical assistance program because of the total absence from the statute of any indication of an intent to confer such authority and the presence of provisions delegating enforcement responsibilities to others.

Neither the parties nor amici, the State of Illinois, the Illinois Hospital Association and St. Mary’s Hospital of East St. Louis, Illinois, Inc., have cited, nor have we found, any Illinois authority on the precise issue before us. Consequently, its resolution must depend upon the legislative purpose and intent to be gleaned from the statutory language.

The pertinent sections of article VII demonstrate the General Assembly’s intent to therein provide for only such assistance as may be necessary to provide needed care for those eligible persons whose financial resources are inadequate and who are not receiving assistance under some other public program. Section 7 — 2 is particularly relevant to our issue. It provides:

“The person shall be given such care as may be necessary and proper, including transportation, and if he dies he shall be decently buried.
The amount and nature of the care provided shall be determined in accordance with a uniform standard of eligibility established by the Illinois Department and its rules and regulations. However, the amount and nature of any such care is not affected by the payment of any grant under the ‘Senior Citizens and Disabled Persons Property Tax Relief Act’. The standard shall include provision for determining what, if any, portion of the income, property or other resources of an applicant or recipient is available to meet the cost of necessary care. However, a local governmental unit not receiving State funds for purposes of this Article may prescribe a uniform standard of eligibility according to local conditions. Such locally prescribed standards may be less, but not more, restrictive than the uniform standard of eligibility established by the Illinois Department.” (Ill. Rev. Stat. 1977, ch. 23, par. 7 — 2.)

This section contemplates that eligible persons be given “such care as may be necessary and proper,” i.e., proper under the uniform standard the section requires the Department to formulate. The Department’s standard is to determine “[t] he amount and nature of the care provided.” The statement, “The standard shall include provision for determining what, if any, portion of the income, property or other resources of an applicant or recipient is available to meet the cost of necessary care” indicates that the standard is to include, but is not to be limited to, income limits of eligibility. Rather, section 7 — 1.2 indicates that one means by which the Department may regulate the “amount and nature of the care provided” pursuant to section 7 — 2 is by defining the “cost of necessary care”:

“The money, property, or other resources available to the person, including support available from legally responsible relatives, must be insufficient to meet the costs of necessary care, as defined by standards established in accordance with Section 7 — 2 of this Article. The eligibility of any applicant for or recipient of public aid under this Article is not affected by the payment of any grant under the ‘Senior Citizens and Disabled Persons Property Tax Relief Act.’ ” Ill. Rev. Stat. 1977, ch. 23, par. 7 — 1.2.

The word “defined” can be reasonably read as referring only to “costs of necessary care,” the nearest words. It would be a strained reading of the section to do otherwise. The regulatory scheme provided by article VII is that the local governments will provide “aid” in meeting “costs of necessary care,” as that term is defined in regulations of the Department pursuant to section 7 — 2, in order that all eligible persons in the State be given “such care as may be necessary and proper” under statewide supervision by the Department.

Article XII of the Illinois Public Aid Code (Ill. Rev. Stat. 1977, ch. 23, par. 12 — 1 et seq.), which deals more generally with the Department’s responsibility for the administration of the Illinois Public Aid Code, also indicates that the Department has authority for the challenged regulations. Section 12 — 3 states:

“As provided in Articles VI and VII, Local Governmental units shall provide funds for and administer the programs provided in those Articles, subject, where so provided, to the supervision of the Illinois Department.” (Ill. Rev. Stat. 1977, ch. 23, par. 12 — 3.)

Although we have found authority for the Department’s regulation within article VII itself, we note that the section 12 — 3 phrase “where so provided” should not be read to restrict the Department’s supervision to matters expressly committed to that supervision in articles VI and VII, particularly in view of the section’s two preceding phrases “[a] s provided in Articles VI and VII,” and “provided in those Articles.” If the legislature had wished to limit the supervision as plaintiff suggests, it would have repeated one of those two earlier phrases. Plaintiff’s restrictive reading of section 12 — 3 is also completely at odds with the broad authority conferred upon the Department with respect to article VII aid by section 12 — 21.17, which states in part:

“The administration of public aid by local governmental units under Article VII shall be subject in all instances to the supervision and rules and regulations of the Illinois Department.” Ill. Rev. Stat. 1977, ch. 23, par. 12-21.17.

The challenged regulations adopted by the Department are as follows:

PO — 105, which provides in part:

“All provisions of this manual are binding on all local governmental units in which Aid to the Medically Indigent is administered by the Department. All other local governmental units must comply with all provisions of this manual unless they have written alternative manual provisions and have received approval of such alternative provisions from the Department.” (Ill. Gen. Assist. Man. PO — 105.)

(It was stipulated by the parties the Groveland Township has no “written alternative manual.”) PO — 1115.1(e), which provides in part:

“Payment for in-patient hospital care in participating hospitals is made at the all-inclusive per diem rate established by the Department.” (Ill. Gen. Assist. Man. PO — 1115.)

Both the earlier-quoted statutory provision and these regulations evince a legitimate concern with the costs of medical care. An obvious purpose of the per diem rate is to insure that public funds will not be dissipated by the payment of unnecessarily or unreasonably high charges for medical services. While the hospitals represented here are not-for-profit corporations, that fact does not guarantee the reasonableness of their operating costs or the efficiency of their operations. Given the quoted statutory provisions, the purpose of article VII, and the State’s interest in efficiently and economically operating its huge medical assistance program, we believe the Department has not exceeded its authority in applying the per diem rate developed under article V to the article VII aid to the medically indigent program. The regulations requiring such action are directly related to, and serve to implement, the legislative intent to limit the expenditure of public funds to only such as may be required to provide necessary care. Use of the per diem rate is the Department’s method of defining the costs of necessary care as authorized in section 7 — 1.2.

St. Mary’s Hospital argues as an amicus curiae that the Department’s regulations fixing the plaintiff’s article VII remuneration at the per diem rate fixed by the Department under article V is unconstitutional. The argument is that this regulation, combined with section 11 — 13 of the Code (Ill. Rev. Stat. 1977, ch. 23, par. 11 — 13) and the provisions of “An Act requiring hospitals to render hospital emergency service ***” operates to deprive hospitals of property without due process. That act, hereafter referred to as the Emergency Services Act, states:

Every hospital required to be licensed by the Department of Public Health pursuant to the Hospital Licensing Act, approved July 1, 1953, as now or hereafter amended, which provides general medical and surgical hospital services shall provide a hospital emergency service in accordance with rules and regulations adopted by the Department of Public Health and shall furnish such hospital emergency services to any applicant who applies for the same in case of injury or acute medical condition where the same is liable to cause death or severe injury or serious illness.” (Ill. Rev. Stat. 1977, ch. 1111/2, par. 86.)

In this case an undisclosed portion of the medical services given were of an emergency nature. St. Mary’s indicates approximately 30% of its patients are given emergency care, although how many of these qualify for aid to the medically indigent is not disclosed. In terms of the effect of the per diem rate, a distinction can probably be drawn between emergency and nonemergency patients, in that longer-term care is generally given the nonemergency cases which comprise the substantial majority of hospitalized patients. (See Joyner v. Alton Ochsner Medical Foundation (La. App. 1970), 230 So. 2d 913.) As to non-emergency patients the Emergency Services Act imposes no duty upon hospitals to provide care. The relevance of this is that what facts we have before us would seem to indicate that the underpayment complained of by plaintiff arises principally in connection with the care of long-term, nonemergency patients whose care is not compelled by the statute. While we agree that the combination of underpayment for compelled services rendered indigents can be cast in due process terms, we do not agree that it has been established that the circumstances here attain that stature. If the rate of remuneration is judged annually by the hospitals to be adequate to cover costs of article V patients, we believe that the plaintiff cannot, without more, argue that the application of those rates to article VII patients amounts to a deprivation of property without due process.

As earlier noted the purpose of the per diem rate is to promote economy and efficiency in the provision of medical care to the recipients of assistance under the statute, a legitimate State interest. Since we have held use of that rate was authorized in measuring the reasonable cost of medical care under article VII, plaintiff bears the burden of overcoming the presumed validity of that use. (Polyvend, Inc. v. Puckorius (1979), 77 Ill. 2d 287, 303; North Shore Post No. 21 v. Korzen (1967), 38 Ill. 2d 231, 233.) Absent a specific showing of the extent to which the deficits complained of are attributable to the emergency care of article VII patients, an arguable due process claim is simply not presented. (See Massachusetts General Hospital v. Weiner (1st Cir. 1978), 569 F.2d 1156, 1161.) As to the nonemergency article VII patients, there exists no State-created compulsion to provide care, and plaintiff’s remedy may well be “the choice of either making [its] operation more efficient or not accepting [article VII] patients” In re Sigety v. Ingraham (1971), 29 N.Y.2d 110, 115, 272 N.E.2d 524, 527, 324 N.Y.S.2d 10, 14 see also LaCrescent Constant Care Center, Inc. v. State (1974), 301 Minn. 229, 235-37, 222 N.W.2d 87, 91; Briarcliff Haven, Inc. v. Department of Human Resources (N.D. Ga.), 403 F. Supp. 1355, 1364.

St. Mary’s cites five railroad- and utility-rate cases in support of its argument. We find them readily distinguishable. Fleming v. Illinois Commerce Com. (1944), 388 Ill. 138, Illinois Central R.R. Co. v. Illinois Commerce Com. (1944), 387 Ill. 256, and Mt. Carmel Public Utility & Service Co. v. Public Utilities Com. (1921), 297 Ill. 303, all involved challenges by railroads and a utility to rates for separable branches of their businesses (suburban service in Fleming and Illinois Central and heating service in Mt. Carmel) which had been set with reference solely to income statistics for their entire systems, when those statistics did not accurately reflect the situation of the branches. These cases turned on the separate character of the services involved. Similarly in Northern Pacific Ry. Co. v. Department of Public Works (1925), 268 U.S. 39, 69 L. Ed. 836, 45 S. Ct. 412, and Banton v. Belt Line Ry. Corp. (1925), 268 U.S. 413, 69 L. Ed. 1020, 45 S. Ct. 534, the United States Supreme Court had occasion to consider rates of separate traffic (log traffic wholly within the State of Washington in Northern Pacific and transfer passengers on a street railroad in Banton). In the present case, even if we believed the situation of railroads and utilities to be apposite to the situation of hospitals, which we do not, there has been no showing by plaintiff that article VII patients can properly be considered a separate branch of the hospital’s business. Rather it appears that article VII patients use the same facilities in the same manner and to the same extent as the rest of the hospital’s patients.

In focusing on its due process argument, plaintiff and amici have almost completely ignored the broad scope of the State’s police power in the area of health. That power is sufficient to justify, in proper circumstances, uncompensated deprivation of personal liberty as well as deprivation of property. (People ex rel. Baker v. Strautz (1944), 386 Ill. 360.) The States have wide regulatory power with respect to the practice of health care professions. (Barsky v. Board of Regents (1954), 347 U.S. 442, 98 L. Ed. 829, 74 S. Ct. 650; Klein v. Department of Registration & Education (1952), 412 Ill. 75, cert. denied (1952), 344 U.S. 855, 97 L. Ed. 664, 73 S. Ct. 93. See also Goldfarb v. Virginia State Bar (1975), 421 U.S. 773, 44 L. Ed. 2d 572, 95 S. Ct. 2004.) Although this court has found foreign-educated doctors had property rights in their State “hospital permits,” the termination of those rights has been upheld against a challenge based on the due process clause:

“The fact that the plaintiffs possess property rights and are entitled to due process protection, however, does not mean that those rights cannot be affected by State legislation. ***. The demands of due process are proportional to the weight of the interest being protected in balancing that interest against the countervailing interests of society. (Powell v. Jones, 56 Ill. 2d 70, 78.) If, after balancing these interests, the State’s exercise of its police power is deemed to be reasonable, the legislation in question must be upheld.” (Rios v. Jones (1976), 63 Ill. 2d 488, 497.)

This court has also indicated that the State’s police power to exclude persons from engaging in a particular business generally includes the power to permit the activity on conditions reasonably related to protection of the general welfare. (City of Decatur v. Chasteen (1960), 19 Ill. 2d 204.) In our judgment the scope of the State’s police power clearly encompasses the power to impose on hospitals licensed by it conditions reasonably designed to promote public health and safety. The New York Court

of Appeals has even indicated the “legitimate legislative purposes of promoting public health, welfare and safety” could authorize the imposition of direct cost regulations upon hospitals in order to control health care costs which were escalating more rapidly than almost any other component of the cost-of-living index. People ex rel. Whalen v. Woman’s Christian Association (1978), 44 N.Y.2d 466, 471, 377 N.E.2d 725, 727-28, 406 N.Y.S.2d 272, 274.

We accordingly hold that use of the per diem rate is authorized for article VII patients, and that, considering the scope of the State’s police power, the circumstances before us do not establish the use of that rate to constitute a denial of due process to the involved hospitals.

The judgment of the appellate court is affirmed. Judgment affirmed.


text:
    (No. 52650.
    EDWARD MORGAN, Appellant, v. THE INDUSTRIAL COMMISSION et al. (Progress Industries, Appellee).

      Opinion filed November 18, 1980.

      Scheele, Serkland & Boyle, Ltd., of Chicago (A. G. Scheele, James C. Serkland and Deborah H. Collander, of counsel), for appellant.
    Harlan Heller, Ltd., of Mattoon (Harlan Heller and Brent D. Holmes, of counsel), for appellee.
   MR. JUSTICE UNDERWOOD

delivered the opinion of the court:

Claimant, Edward Morgan, filed an application for adjustment of claim under the Workmen’s Compensation Act (Ill. Rev. Stat. 1975, ch. 48, par. 138 et seq.) on the basis of injuries to his right leg. The arbitrator found that the injuries sustained caused 20% permanent and complete loss of use of the right leg and also awarded compensation for 15 weeks of temporary total incapacity for work. The Industrial Commission heard additional evidence and affirmed the decision of the arbitrator, modifying it to increase the permanent and complete loss of the use of the right leg to 33 1/3%. The circuit court of Coles County confirmed the decision of the Commission and claimant appealed directly here, urging that an award for less than permanent and total loss of use of the right leg is contrary to the manifest weight of the evidence.

The parties stipulated before the arbitrator that claimant was the employee of Progress Industries (Progress) on July 7, 1976, when he sustained accidental injuries which arose out of and in the course of that employment. Only the claimant and Progress’ vice-president of industrial relations testified before the arbitrator, although certain letters or reports from doctors and hospital records were introduced into evidence. Claimant testified that, while he was working for Progress in Arthur, a metal “pattern” which weighed 400 to 500 pounds fell from a suction cup and struck his lower right leg. He testified on cross-examination that he had suffered from varicose veins in his legs for a number of years before the accident and that he had received a veteran’s benefit because of his legs since 1945. After the accident the claimant was treated by Dr. Messmoor (whose opinion is not in evidence) and then worked for two days. When the pain in his leg worsened, claimant discontinued work, was again treated by Dr. Messmoor, but eventually went to the emergency room of a Mattoon hospital. He was then hospitalized under Dr. Anton Dippold’s care, and apparently has not worked since.

The medical evidence presented to the arbitrator included a report by Dr. Dippold, who had treated claimant from the time of his hospitalization on or about July 22, 1976, to October 8. He was of the view that claimant was no more disabled after the accident than he had been before it. He suggested that a vascular specialist be consulted if claimant were to claim disability based on the condition of the varicose veins prior to the accident. When he last saw claimant on October 8, Dr. Dippold released him to return to work October 25.

Dr. J. R. Mallory, who saw claimant on October 25, concluded in his report that claimant was then totally disabled, noting “progressive disability relative to the lower extremities.” There is, however, nothing in the record indicating Dr. Mallory knew of the accident, and his letter makes no reference to any causal connection between the disability and an injury.

Dr. Jack Cooley examined claimant on March 28, 1977. He was of the opinion that claimant was then totally disabled. Dr. Cooley’s somewhat ambiguous letter can be read to imply either that the disability had resulted from the injury to the right leg or that the disability resulted from degeneration of varicose veins in both legs independently of the accident.

This court has often stated that the Industrial Commission is to determine the nature and extent of the employee’s disability, drawing reasonable inferences from the evidence, including the medical evidence. That determination will be upheld, particularly in the presence of conflicting medical opinions, unless it is contrary to the manifest weight of the evidence. United Airlines, Inc. v. Industrial Com. (1980), 81 Ill. 2d 85; Inland Steel Coal Co. v. Industrial Com. (1980), 81 Ill. 2d 61; Scuderi v. Industrial Com. (1978), 73 Ill. 2d 277.

Clearly there is conflict here in the medical evidence relating to the issue of causation. Dr. Dippold believed that there was no more disability after the accident than had existed before it. Dr. Cooley’s letter was unclear as to what had caused the total disability he found, although he did state that the accident had caused “increased disability.” Dr. Mallory did not relate the disability to the accident.

There was also disagreement as to the extent of disability. Dr. Dippold believed that there was no disability in October 1976 and ordered claimant back to work. Dr. Mallory apparently believed claimant totally disabled at that time, and Dr. Cooley was of the opinion that claimant was totally disabled when he was examined in March 1977.

There is disagreement, too, in the medical findings. Dr. Dippold found no inflammation of the varicosities. Dr. Mallory found changes in pigmentation, bilateral varicosities with no dependent edema, and diminished but adequate peripheral pulsation. Dr. Cooley found tenderness, bilateral pretibial edema, stasis dermatitis, pigmentation and chronic venous insufficiency of both legs. With respect to the right lower leg, he also found stasis cellulitis and more severe stasis dermatitis and pigmentation. In addition he noted adequate pulses in both legs and evidence of many years of venous insufficiency, including leg scars from previous surgery.

There may be several reasons for the Commission’s decision. It may have rejected Dr. Cooley’s opinion of total disability or may have read his report to say that the total disability he saw in March 1977 was the result of natural degeneration of both legs, independent of the accident. It may have rejected Dr. Mallory’s opinion and given weight to Dr. Dippold’s opinion that the claimant had not been totally disabled in October 1976. The Commission may have relied on the arbitrator’s and commissioner’s examinations of the leg. Whatever the reason, it is apparent that sufficient conflict in the evidence existed to preclude a finding that the award of compensation for the permanent and total loss of one-third of the use of claimant’s right leg is contrary to the manifest weight of the evidence.

The judgment of the circuit court of Coles County is accordingly affirmed.

Judgment affirmed.