*1 Illinois Official Reports Appellate Court
Krozel v. Court of Claims
,
Appellate Court LAINIE KROZEL, Plaintiff-Appellant, v. THE COURT OF CLAIMS; THE STATE OF ILLINOIS; and CONNIE BEARD, in Her Caption
Official Capacity as Director of Revenue, Defendants-Appellees. First District, First Division District & No.
Docket No. 1-16-2068 Filed April 24, 2017
Rehearing denied June 9, 2017
Decision Under Appeal from the Circuit Court of Cook County, No. 15-CH-13301; the Hon. Rita M. Novak, Judge, presiding. Review Affirmed.
Judgment Counsel on Nixon Peabody LLP, of Chicago (Floyd D. Perkins, of counsel), for appellant. Appeal
Lisa Madigan, Attorney General, of Chicago (David L. Franklin, Solicitor General, and Frank H. Bieszczat, Assistant Attorney General, of counsel), for appellees. JUSTICE HARRIS delivered the judgment of the court, with opinion.
Panel
Presiding Justice Connors and Justice Mikva concurred in the judgment and opinion.
OPINION ¶ 1 Plaintiff, Lainie Krozel, appeals the order of the circuit court granting defendants’ motion
to dismiss her complaint for writ of , which sought review of the Court of Claims’ dismissal of her indemnity claim. On apрeal, plaintiff contends her complaint should be reinstated because (1) the Court of Claims erroneously applied the two-year general statute of limitations contained in section 22(h) of the Court of Claims Act (705 ILCS 505/22(h) (West 2014)) instead of the five-year statute of limitations in section 22(a) for claims arising out of a contract (705 ILCS 505/22(a) (West 2014)); and (2) her due process rights were violated where the Court of Claims did not consider her complaint on the merits. For the following reasons, we affirm.
¶ 2 JURISDICTION The trial court dismissed plaintiff’s complaint on May 17, 2016. Plaintiff filed a motion to
reconsider and vacate, which the trial court denied on June 23, 2016. Plaintiff filed her notice of appeal on July 21, 2016. Accordingly, this court has jurisdiction pursuant to Illinois Supreme Court Rule 301 (eff. Feb. 1, 1994) and Rule 303 (eff. May 30, 2008) governing appeals from final judgments entered below. BACKGROUND The following faсts are relevant to this appeal. On December 12, 2008, the office of the
Executive Inspector General (EIG) filed a complaint with the Illinois Executive Ethics Commission (EEC) alleging that plaintiff, the acting chief of staff for the Illinois Department of Revenue, violated the State Officials and Employees Ethics Act (5 ILCS 430/1-1 et seq. (West 2014)). Plaintiff sought legal representation from the Attorney General pursuant to section 2 of the State Employee Indemnification Act (Indemnification Act) (5 ILCS 350/2 (West 2014)). The Attorney General, however, represented EIG in the matter and denied plaintiff’s request. Plaintiff therefore retained private counsel to represent her. Plaintiff continued to request representation by the Attorney General’s office, and she argued for dismissal of the charge against her. Motions were filed and discovery conducted in preparation for trial on June 29, 2010. However, on the eve of trial, the Attorney General’s office voluntarily dismissed the complaint against plaintiff. Plaintiff subsequently sought indemnification for her attorney fees under section 2(b) of the Indemnification Act (5 ILCS 350/2(b) (West 2014)). In April 2011, the Illinois Department of Revenue notified plaintiff it would not indemnify her for her attorney fees and costs. On March 5, 2014, plaintiff filed a claim with the Court of Claims to reсover her costs and
attorney fees under section 2(b). The State filed a motion to dismiss pursuant to section 2-619 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619 (West 2014)), arguing that section 22(h) of the Court of Claims Act requires plaintiff to file her claim within two years after its accrual. The State alleged that plaintiff’s claim accrued “either when the EEC matter was voluntarily dismissed by the EIG on June 29, 2010, ending [her] need for legal representation, or at the very latest, when her subsequent request for attorneys’ fees was denied, in April 2011.” The State argued that since plaintiff filed her claim on March 5, 2014, it is barred by the limitations period set forth in section 22(h) and “must be dismissed in its entirety.” The State *3 also argued that plaintiff’s claim should be dismissed under section 2-615 of the Code (735 ILCS 5/2-615 (West 2014)) for failure to state a claim under the Indemnification Act. Plaintiff filed a response to the State’s mоtion to dismiss, in which she argued that the proper limitations period for filing her claim is found in section 22(a) of the Court of Claims Act for claims “arising out of a contract.” 705 ILCS 505/22(a) (West 2014). Such claims “must be filed within 5 years after it first accrues” rather than the two years under section 22(h) for “[a]ll other claims.” 705 ILCS 505/22(a), (h) (West 2014). Plaintiff argued that section 22(a) applies because she “seeks reimbursement for her attorneys’ fees, costs, and expenses under the terms and conditions of her employment contract with the State, as those terms and conditions are set out in the Indemnification Act.” Plaintiff argued that the State “was required to pay reasonable court costs, litigation expenses, and attorneys’ fees pursuant to the Indemnification Act” where the Attorney General could not represent her due to a conflict of interest. In response, the State argued that the two-year limitations period applied because plaintiff was seeking payment pursuant to a statute (the Indemnification Act) rather than asserting a contract claim. After the Court of Claims heard argument from both parties on the issue, it dismissed
plaintiff’s claim in its entirety. The Court of Claims acknowledged that the appropriate statute of limitations for claims arising under the Indemnification Act is an issue of “first impression.” It noted that the Indemnification Act encompasses statutory duties “distinct from other theories of liability.” Therefore, it concluded that plaintiff’s “potential right to reimbursement pursuant to the Indemnification Act is independent from the underlying contract with the State of Illinois.” It applied the two-year limitations period because plaintiff’s right to recovery arose from a statute rather than a contract, and since plaintiff did not file her claim within two years of April 2011, when her reimbursement request was denied, her claim was untimely. Plaintiff filed a petition for rehearing in which she again alleged that her claim arose out of a contract and therefore the five-year limitations period of section 22(a) applied. Plaintiff argued that her right to indemnification under the Indemnification Act arose from her employment and service; therefore, it was a matter arising out of contract. The State filed a response, and plaintiff replied, reiterating her argument that her claim is a contract claim. The Court of Claims denied the petition and upheld its previous order dismissing plaintiff’s complaint as untimely. In the order, the Court of Claims disagreed that “the Indemni[fication] Act must be construеd as a contractual term of [plaintiff’s] employment with the State.” It found that “[t]he law is clear. Statutes are presumed not to create contractual rights unless there is clear and explicit intent to do so by the legislature. The Indemni[fication] Act does not demonstrate a clear and explicit intent by the legislature to create a vested contractual right.” The Court of Claims found “unconvincing” plaintiff’s argument that the word “agreement” in the latter part of section 2(a) of the Indemnification Act (5 ILCS 350/2(a) (West 2014)) shows legislative intent to create a contractual right. Rather, plaintiff’s argument “discounts the context in which the word ‘agreement’ is used and isolates it from the proper context,” and the mere use of the word “does not explicitly create a contract, covenant, or vested right that obligаtes the State, its agents, or the Attorney General to appear on behalf of the employee and defend the action.” It affirmed the dismissal of plaintiff’s claim as untimely. Plaintiff filed a complaint for writ of , seeking review and reversal of the Court of
Claims’ decision. In her complaint, plaintiff alleged that the Court of Claims failed to apply the five-year statute of limitations on her contract clаim and, by failing to follow the law, the *4 decision “denied her both constitutional due process and equal protection.” Plaintiff also argued that she “had no opportunity to be heard in a meaningful manner based on the Court’s unlawful failure to follow the law.” Defendants moved to dismiss the complaint pursuant to section 2-619.1 of the Code (735 ILCS 5/2-619.1 (West 2014)), arguing that the trial court lacked jurisdiction to review the correctness of the Court of Claims’ determination and that plaintiff was not denied due process where she received a meaningful opportunity to be heard before the Court of Claims. The trial court granted defendants’ motion to dismiss and found the following cases
controlling:
Klopfer v. Court of Claims
,
statute of limitations to dismiss her indemnification claim against defendants. She argues that
the Court of Claims’ improper dismissal denied her the right to be heard on the merits of her
claim and, since she alleged this violation of her due process rights, the trial court erred in
dismissing her complaint for writ of
certiorari
. Defendants filed a combined motion to dismiss
under section 2-619.1 of the Code (735 ILCS 5/2-619.1 (West 2014)). In reviewing a dismissаl
pursuant to both sections 2-615 and 2-619 of the Code (735 ILCS 5/2-615, 2-619 (West
2014)), “we accept all well-pleaded facts in the complaint as true and draw all reasonable
inferences from those facts in favor of the nonmoving party.”
Dopkeen v. Whitaker
, 399 Ill.
App. 3d 682, 684 (2010). Dismissal under either section is proper where plaintiff alleges no set
of facts that would entitle her to relief. We review dismissal pursuant to both sections
de novo Kopchar v. City of Chicago
,
of sovereign immunity, “[e]xcept as the General Assembly may provide by law,” the
legislature established the Court of Claims with exclusive jurisdiction to hear and determine
“[a]ll claims against the State.” See 705 ILCS 505/8(a), (b) (West 2014). The function of the
Court of Claims is not to adjudicate cases but rather “to receive and resolve claims against the
state.”
People v. Philip Morris, Inc.
,
process, we find
Klopfer
instructive. In
Klopfer
, the plaintiff filed a complaint in the Court of
Claims on January 16, 1981, seeking payment for abortions he performed on public aid
recipients from June 1978 to February 1979.
Klopfer
,
Claims, and the Court of Claims moved to dismiss the petition. The trial court granted the motion to dismiss. In determining whether dismissal was proper, the appellate court noted that “decisions of the Court of Claims are generally not subject to judicial review” except “where the Court of Claims acts in a manner that deprives a party of the constitutional right to due process.” Id. The court thus considered only issues that addressed the due process given plaintiff before the Court of Claims, and “the propriety оf the trial court having disposed of this action” under section 2-619. at 503. Noting that the plaintiff must show he filed his claim within the one-year limitation period
provided in the Act, the court found that “[n]othing in the record of the proceedings before the Court of Claims or in the factual allegations contained in plaintiff’s petition for a writ of even remotely suggests” the plaintiff was denied “an opportunity to introduce evidеnce in an effort to meet that burden.” at 506. It also found “no exception to the requirement that the jurisdictional time limitations in the Act must be met before the subject matter jurisdiction of the Court of Claims attaches.” at 507. Therefore, since the plaintiff did not file his claim within the one-year statute of limitations period and there was no deprivation of his due process rights by the Court of Claims, the trial court properly dismissed the plaintiff’s petition for writ of at 508. See also Reyes , 299 Ill. App. 3d at 1104-06 (plaintiff was not deprived of his due process rights when the Court of Claims dismissed his claim as untimely, where it considered plaintiff’s objections to the motion to dismiss based on the timeliness issue, as well as plaintiff’s motion for rehearing and reconsideration, giving plaintiff “several opportunities to be heard”). As in Klopfer and Reyes , the issue before this court is whether the dismissal of plaintiff’s
indemnity claim as untimely denied her due process. To make this determination we consider,
pursuant to and , whether the Court of Claims provided plaintiff with an orderly
proceeding where she received adequate notice and an opportunity to be heard.
Id.
at 1104.
After plaintiff filed her claim with the Court of Claims, the State moved to dismiss based on the
statute of limitations and plaintiff filed a response arguing that thе five-year limitation applied
and her claim was timely. The parties also presented their arguments at a hearing before the
Court of Claims. After the dismissal of her claim, plaintiff filed a petition for rehearing in
which she again argued for the five-year limitation and that she was denied due process. The
record shows that plaintiff had numerous opportunities to be heard on the timeliness issue.
*6
Thereforе, plaintiff was not denied due process, and the trial court did not err in dismissing her
complaint for writ of
certiorari
.
Klopfer
,
merits of her claim before the Court of Claims. As support, she cites Rossetti . In Rossetti , a general contractor entered into a contract with the Illinois Department of Transportation and hired a subcontrаctor to work on various projects pursuant to the contract. Rossetti , 109 Ill. 2d at 74. After a dispute, the general contractor filed a claim with the Court of Claims seeking money due under the contract, including payments owed to the subcontractor. The Department of Transportation raised an affirmative defense, arguing that the general contractor engaged in fraud against the State. Id. at 74-75. The subcontractor sought to intervene in the action to argue that it had not engaged in fraud and should be paid. The Court of Claims, providing no reason, denied the subcontractor’s request to intervene and granted summary judgment in favor of the Department of Transportation. The general contractor’s claim was then dismissed in its entirety. Id. at 75. The subcontractor filed a complaint for writ of certiorari in the circuit court. Although the
court acknowledged that a manifest injustice had been done to the subcontractor and that it should have a right to appear in a forum and present its claim for payment, the court determined it had no jurisdiction over the matter and dismissed the complaint. Id. at 76. The subcontractor filed an appeal which this court dismissed. The supreme court allowed a petition for leave to appeal. Id. at 76-77. Recognizing that the Court of Claims Act provides no method of judicial review of Court
of Claims’ decisions, the supreme court characterized the “primary issue” before it as whether
filing a writ of
certiorari
was a proper method for the subcontractor to obtain judicial review.
at 77. Following its decision in
People ex rel. Harrod v. Illinois Courts Comm’n
, 69 Ill. 2d
445, 458 (1977), in which the supreme court determined that the Illinois Courts Commission
was not a coequal court within the meaning of the constitution, it found that the Court оf
Claims also “is not a court within the meaning of the judicial article but instead is a fact-finding
body.”
Rossetti
,
heard before the Court of Claims, and therefore she also was deprived of her due process
rights. We disagree. First,
Rossetti
did not involve a statute of limitations issue as we have
here. Before reaching the merits of plaintiff’s claim, the Court of Claims must have jurisdiction
to hear her claim. There is “no exception to the requirement that the jurisdictional time
limitations in the Act must be met before the subject matter jurisdiction of the Court of Claims
attaches.” , 286 Ill. App. 3d at 507. Also, unlike the subcontractor in
Rossetti
, who
*7
never had the opportunity to intervene or present any argument, plaintiff here had multiple
opportunities to be heard on the limitations issue, whiсh satisfies due process concerns under
these circumstances. See
id.
at 508;
Reyes
,
where the parties in those cases did not dispute the applicable limitations period while the
parties here disagree on whether the two or five-year limitations period applies. Plaintiff
argues that her claim stems from a contractual right created by section 2(a) of the
Indemnification Act, making the five-year limitations period applicable to her. The Court of
Claims, however, looked at the language of the Indemnification Act and determined that no
contract right was created; thus, the five-year limitations did not apply to plaintiff. Although
may not be used to review the correctness of a Court of Claims’ decision based on
thе merits, a court may review that decision for due process violations where the Court of
Claims’ actions exceed its constitutional authority to so act.
Rossetti
,
did not apply, the Court of Claims relied on clear and settled law that statutes are presumed not
to create contractual rights unless the legislature expresses a clear and explicit intent to do so.
Its order after rehearing cited to
Dopkeen v. Whitaker
,