Retirement Plan for Chicago Transit Authority Employees v. Chicago Transit Authority, 156 N.E.3d 86

Background

The Retirement Plan for Chicago Transit Authority Employees (RP) agreed with the CTA that RP would pay the CTA the “actual cost” of retirees’ prescription drugs; the CTA administered the retiree plan and contracted separately with Caremark as pharmacy benefits manager.
Caremark’s contract with the CTA provided for rebates tied to pricing/volume/plan design; RP did not participate in procurement and was not a party to the Caremark contract.
RP’s executive director (Kallianis) learned of the existence of Caremark rebates and e‑mailed the CTA’s benefits manager on February 8, 2007 asking whether RP would be credited; the CTA later told RP in August–October 2009 that historically the rebates were retained to offset CTA administrative costs.
RP sued in June 2013 alleging accounting, breach of express and implied contract, unjust enrichment, prohibited transactions under the Illinois Pension Code, and breach of fiduciary duty for the CTA’s retention of rebates.
The trial court granted summary judgment dismissing contract/unjust enrichment claims that accrued more than five years before suit (applying the discovery rule and finding accrual as of February 8, 2007) and applied the voluntary payment doctrine; after a bench trial the court found RP failed to prove a fiduciary relationship and entered judgment for the CTA.
The appellate court affirmed: the discovery rule started the limitations period on February 8, 2007, barring older contract claims, and the record did not support a fiduciary or agency relationship between RP and the CTA.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
When did the 5‑year statute of limitations begin for contract claims?	SOL begins when RP knew CTA would not credit rebates (Aug/Oct 2009).	SOL began when RP learned rebates existed and were not credited (Feb 8, 2007).	Accrual under discovery rule was Feb 8, 2007; claims accruing before June 13, 2008 barred.
Do the voluntary payment doctrine and mistake-of-fact avoid bar to claims?	RP paid invoices believing it would be reimbursed or that reconciliation would follow—payments were not voluntary mistakes.	RP continued to pay after knowing about rebates; doctrine bars recovery.	Trial court applied voluntary payment doctrine, but appellate court affirmed on SOL grounds and did not need to resolve doctrine issue.
Did the CTA act as RP’s agent in negotiating Caremark (creating fiduciary duty)?	CTA negotiated Caremark terms affecting RP; CTA acted as RP’s agent.	RP had no role or control in procurement; CTA did not act as RP’s agent.	No agency; CTA did not have authority or control to bind RP—no fiduciary duty from agency.
Did a fiduciary relationship otherwise exist (dominance/reliance)?	RP relied on CTA to administer retiree benefits and expected rebates as discounts; that reliance created a fiduciary duty.	RP was an independent, sophisticated entity with its own staff and advisors; no domination or control by CTA.	No fiduciary relationship: RP was capable and independent; reliance without dominance insufficient.

Key Cases Cited

Hermitage Corp. v. Contractors Adjustment Co., 166 Ill. 2d 72 (explains discovery/inquiry rule for accrual of contract claims)
Knox College v. Celotex Corp., 88 Ill. 2d 407 (discovery rule tolls limitations until plaintiff discovers or should discover cause of action)
Nolan v. Johns‑Manville Asbestos, 85 Ill. 2d 161 (once injury reasonably appears, plaintiff must inquire further to determine actionable wrong)
Benson v. Stafford, 407 Ill. App. 3d 902 (fiduciary/agency requires dominance or control; mere trust and relative experience not enough)
Ransom v. A.B. Dick Co., 289 Ill. App. 3d 663 (factors courts consider in determining fiduciary relationship)
Pel‑Aire Builders, Inc. v. Jimenez, 30 Ill. App. 3d 270 (when contract is silent, law implies reasonable time for performance; factual question of breach timing)