*1 CENTER, INC., ROSEWOOD Plaintiff-Appellant, CATERPILLAR, CARE (Enloe INC., Defendant-Appellee LLC, Plaintiff; Drugs, Betty Cook, Jo Defendant). Third District No. 3 - 05-0299
Opinion July filed LYTTON,J, concurring. specially Peoria, ap- Miller, for Triggs, & (argued), Hall Kohlhase
William R pellant. Greg Kendall, Hansen, (argued), A. Elward Mark D. Brad Karen L. Peoria, appellee. Allen,
Rastatter, Heyl, Royster, & all of Voelker the court: opinion JUSTICE HOLDRIDGE delivered *2 (Rosewood) against filed suit Care Plaintiff Rosewood Center Caterpil- to Inc., provided it seeking payment for Caterpillar, services at Rosewood. Betty patient she a employee lar Jo Cook while was Caterpillar’s alleged promise sought based on Plaintiff reimbursement dismiss, that the statute arguing to pay. Caterpillar filed motion found that the statute of frauds suit. trial court barred Rosewood’s complaint. suit of frauds did indeed Rosewood’s and dismissed bar law, that, under the current state of the the statute of We hold to the suit. therefore reverse and remand does not bar Rosewood’s We proceedings. circuit court for further 2001, she
Betty employed by Caterpillar. In October Jo Cook was job. She then filed alleged injury that she suffered while on against Caterpillar. compensation claim workers’ benefits nursing home care. Ac- injury required hospitalization Cook’s and cording complaint, Caterpillar and Rosewood’s contacted Rosewood nursing managed- sought facility skilled on Cook’s admission (fixed-rate) Services, Through agent, Management HSM care basis. on that Rosewood refused admit Cook basis. 10, 2002, in Just, physician charge
On Dr. January Norma compensation Caterpillar claims of medical care related to workers’ admitted to Rosewood employees, requested that Cook be Rosewood. during negotiations, promised Caterpillar claims that Dr. that Just in full. Just’s and as- would the cost of Cook’s care Dr. statements writing. surances not reduced to Dr. confirming Dr. day,
On that same HSM faxed a letter to Just The letter stated that Just’s authorization of Cook’s admission. future Caterpillar agreed any to four weeks of treatment and that determined length her treat- stay evaluation of Cook’s would be it on ing physician. signed Dr. the letter and returned Rosewood Just January 11, 2002. January nursing facility Cook skilled
Rosewood admitted to its and 30, 2002. treatment Cook remained Rosewood received incurred medical During stay, care June her Cook through $181,857. Rosewood pharmaceutical charges in the amount expenses, Caterpillar Caterpillar pay demanded that Cook’s refused. against Among
Rosewood filed suit Caterpillar. Cook and other things, complaint alleged Caterpillar authorized Cook’s treat- ment and that it admitted Cook in reliance on Caterpillar’s promise expenses Therefore, for Cook’s while facility. she was at the Caterpillar responsible charges for the various incurred dur- Cook ing stay. sought Caterpillar her from recovery based on contract, theories of breach of promissory estoppel quantum Caterpillar meruit. complaint pursuant moved to dismiss the to sec- (Code) (735 tions 2—615 and 2—619 the Code of Civil Procedure (West 2004)). ILCS Among 2—619 arguments, other 5/2 — Caterpillar claimed that the statute of frauds barred Rosewood’s alleged agreement claims since the pay Cook’s bills was writ- not ing. The applied trial court found that the statute and dismissed all three against Caterpillar pursuant counts section 2—619 Code.
STANDARD OF REVIEW A section motion to all well-pleaded 2—619 dismiss admits complaint facts in the together with all reasonable that can inferences (Redwood plaintiffs be drawn from those facts favor v. Lier man, (2002)), and it raises defects or (Krilich defenses that bar the claim v. American National Bank & (2002)). Trust Co. Chicago, The trial court *3 must presented constituting consider whether the defendant facts an plaintiffs affirmative defense that would the action. defeat cause of Poulos, v. Prodromos We review de novo a Bank, dismissal under section 2—619. Savings Prodromos Howard
ANALYSIS I. of Statute Frauds (statute frauds) (West (740 2004)) The Frauds Act of ILCS 80/1 provides that, exceptions, promise absent certain an oral to answer for the of is writing. debt another unenforceable unless in ***whereby charge brought “No action shall be to the defendant debt, any special promise to for the default miscar- answer or ***,
riage person promise agreement upon of another unless the or brought, which or such action shall be some memorandum thereof, signed writing, by party note shall be in the to be therewith, charged person lawfully or some him thereunto (West2004). 740 ILCS authorized.” 80/1 case, parties agree In this both that the faxed letter that was signed January 11, by Dr. Just and returned to Rosewood is Thus, support promise insufficient to the Rosewood seeks to enforce. promise to Caterpillar’s oral question must consider is whether the we debt of promise to answer for the special Cook’s debt constitutes pay and is therefore meaning the statue of frauds the of another within unenforceable. not bar of frauds does that the statute
Rosewood contends
expenses because
promise
pay
to
Cook’s
Caterpillar’s
enforcement
First,
statute.
Rosewood
“special” promise under the
it was not a
is,
made its
debt,
Caterpillar
that
preexisting
no
argues that there was
to
goods and services
provided
Rosewood before Rosewood
promise to
pay
to
Second,
Caterpillar’s promise
Rosewood maintains
Cook.
Caterpil-
it
special
promoted
stay
promise
was not a
because
Cook’s
satisfying
obligation
its
under
Workers’
lar’s own interests in
2004)).
(820
305/8(a) (West
(Act)
Act
Compensation
ILCS
separate
in two
1800s,
Supreme
In
Court held
the late
Illinois
promise
if the
only applicable
the statute of frauds was
cases that
obligation
the principal
made after the
pay
another was
Corbet,
frauds to the instant matter Williams ley agree. Bros. We Caldwell, Williams,
In
agreed to deliver cattle
but
Corbert
promise
after Williams made an oral
to Corbert
Corbert for
cattle.
the cattle to
When Williams refused
Corbert delivered
Caldwell.
Williams,
payment,
brought
against
pled
suit
the statute
Corbert
who
supreme
as a defense. Our
court held that the statute
protect Williams, reasoning:
frauds did not
person
given,
[Williams]was
the credit was
is
“That
whom
clear,
undertaking
col
and that fact makes the
and not
lateral, and therefore not within the statute of frauds. The whole
single bargain,
incorporated
[Williams’]
was one
part
It is not at all
into the contract and became an essential
of it.
executed,
like a case where the contract
and the
created;
in such a case
made after the debt was
such
Williams,
must,
binding,
writing.”
to be
be in
the brothers demanded from who Citing refused. its Williams, decision in supreme again our court held statute of frauds did not recovery. Hartley Bros., bar Ill. 88 at 563. Bros, Hartley together Williams and directly stand for the proposition that the statute of frauds is in applicable, surety, matters of the promise where debt of another was made after the obligation of the had debtor been incurred. See also Ricci v. (for (1988) Reed, apply, statute frauds to there must existing guarantor’s be an debt at time alleged Associates, promise); Co., Advertising Publishers Inc. v. Wessell 1980) (in 1076, F.2d Cir. applying the Illinois statute frauds, for applicable, existing the statute to be must be an there assurances). guarantor’s at the alleged time
It
supreme
is well settled that when our
court has declared
on
law
any point, only
modify
decisions,
it can
or
previous
overrule its
and all
lower
are
supreme
precedent
courts
bound to follow
until
court
such
precedent
by
changed
supreme
generally
See
Page
court.
Du
County
Authority
Revenue,
Airport
Department
3d
(2005) (and
therein).
Thus,
cited
the question squarely
cases
holding
before this court is whether the
in
Hartley
Williams and
Bros.
have been
by
modified or overruled
our
court.
supreme
Our
of supreme
precedent
review
court
leads us to conclude that
Bros,
Hartley
good
and
are
Our
Williams
still
law.
research revealed
supreme
holding
no
court
overruling
modifying
decision
in
appellate
articulated
those two decisions. Several decisions of the
Hartley Bros.,
seem
at
and
court would
to be
odds with Williams
but
they
precedent, they
to the extent
conflict with supreme court
cannot
Shinitzky
Dentinger,
See
&
be followed.
Brown
Chartered v.
(1983);
Dresner,
Swartzberg
recognize
in
holding
Hartley
We also
that the
articulated
Williams
Bros,
jurisdictions
has
been abandoned
commentators.
(S.D.N.Y.
Co.,
1958),
F. Supp.
See Kossick United Fruit
rev’d
731,
56,
L.
grounds,
on other
365 U.S.
Ed. 2d
735 that these counts. note estoppel meruit We quantum promissory Il of Under the statute frauds. based counts were dismissed and in all at law law, frauds to bar claims the statute of acts linois Investment, Heritage Enterprises, Inc. v. Realty & equity. Edens View applied be Promissory estoppel cannot Inc., App. Ill. 3d 480 87 claim. recovery the statute frauds bars the contract allow where of Co., Buy Supp. F. Partnership Best Peoria Associates Ltd. (N.D. 1997); 245 Ill. 3d Quincy College Corp., Ill. Dickens case, the trial apply to this Since the of frauds does not statute remaining in dismissing court erred Rosewood’s counts.
CONCLUSION reversed County Tazewell judgment The of the circuit court of ruling. for with this proceedings and remanded further consistent and remanded. Reversed
BARRY,J., concurs. LYTTON, specially concurring: JUSTICE
I widely recognized discuss the separately general write the deci preexisting requirement. trend to abandon the debt Since Corbet, (1862), in v. Var Hartley sions Williams v. Bros. ner, the (1878), 1800s, Ill. 561 in the mid the law on were decided As applicability significant change. of of seen the statute frauds has today agreed “special” the it is that a majority, generally noted simultaneously may prior to or promise within the statute be made may the creation as an principal obligation, with be offered inducement to the creditor to enter a contract the into with Shinitzky Dentinger, debtor. Brown & Chartered (1961) (abstract (1983); Owens, 30 of Evans v. Lord, 22:14, op.); § 9 R. on ed. Williston Contracts at 276-77 Associates, 1999); 1076; Inc., but F.2d Advertising Publishers cf. (for (1988) Reed, ap Ricci v. of frauds to statute ply, existing there must the alleged guarantor’s be an debt at time of promise). debt, itself, history concept
The
of a
discloses
preexisting
the
doctrine,
at the
legal
that it is not
but a
used
deep-rooted
device
century
turn of the twentieth
to reach a desired conclusion or
avoid
(Second)
116,
wrong.
§
seeming
Restatement
of Contracts
Comment
a,
the
no
language
at 300
statute contains
distinguish
debt
It
an
preexisting
requirement.
does not
between
antecedent
subsequent
promise.
debt and
debt created
See
(West 2004).
740 ILCS
plain
Based on the statute’s
language,
80/1
promise to
or miscarriage
answer
the default
of another comes
purview
regard
within
without
to the time
when the
(S.D.N.Y.
Co.,
1958),
made. Kossick v. United Fruit
II Thus, I agree Shinitzky with Brown & Chartered that an oral guarantee contract to the debt of another statute violates the of frauds upon and is unless it and independent unenforceable is founded a new newly contracting parties consideration passing between the Chartered, independent underlying Shinitzky Brown & debt. promise Ill. is App. determining 118 3d whether oral special promise or is promise within the statute whether accomplished. independent underlying easily is not adopted test whether an oral Historically, analyze courts a basic promise If the special within statute. promise constituted
737 liability of another of a debt independent original was promise collateral, the If the was the statute. it not within person, (1901); Lake App. Ill. Armstrong, 97 McKinney applied. Nicholson, Nurses Training School Hospital Ass’n & View (1916). meaning fell within Only a collateral Ill. & Mar Bonner used in the statute. promise as “special” of the term Hansell, Ill. shall Co. v. appear anywhere do not “original” and “collateral” The terms mode as a convenient by courts more been used the statute and have interpretation. use meaningful rather than a expression terminology part of They the statute. precedes terms these Morrison, Bullen v. law action of debt. applicable to a common to an action of give rise original promise An would App. 669 binding might be a though it debt; promise, “whereas collateral detriment had because a assumpsit would lie contract which request, could not be at the defendant’s plaintiff incurred been 22:6, at 248 Lord, on Contracts of debt.” 9 R. Williston the basis 1999). analysis, of frauds while Using terms in a statute ed. these convenient, helpful. very is not determining difficulty in recognized the recently,
More
courts
attempted
and have
or collateral
whether a
Associates, Inc.,
Advertising
test. See Publishers
define a more useful
Dresner,
1076;
Swartzberg
F.2d
is to be
question
that the
appellate courts have noted
Some Illinois
used,
all of the
determined,
but from
particular
“not from the
words
1066;
Ricci,
3d at
transaction.”
circumstances of the
Associates, Inc.,
F.2d at 1079.
Advertising
Publishers
that the intention of
jurisdictions have stated
Courts from other
from the words of
parties
and should be ascertained
controls
*7
all of the
parties, as well as
promise and the situation of the
Weber,198 Or.
surrounding the transaction. Eilertsen v.
circumstances
Bank,
(1953);
FS.B. v. Weaver-
1,
Savings
Landmark
While these various tests are all supported by authority, the “lead- ing object” rule is the meaningful most and way effective of determin- ing whether a is within the statute of frauds. would follow the trend toward categorizing promise as either collateral or by application of the “leading object” Lord, rule. 9 R. Williston on 1999). 22:11, §§ Contracts 22:20 ed. argues that the statute of frauds apply does not in this
case because the main purpose Caterpillar’s promise promote was to its own interests. Rosewood claims that Caterpillar direct, received a substantial goods benefit because the and services furnished Rose- wood met Caterpillar’s statutory obligation under the Workers’ Compensation provide Act to required treatment due to Cook’s work- 305/8(a) (West 2004). injury. related See 820 ILCS 8(a) Act, Under section employers required are provide pay for all the “necessary required, medical services” limited to that which is “reasonably required” to treat the injury.” “accidental 305/8(a) (West 2004). 820 ILCS assumption Caterpil- Rosewood’s obligated lar is for Cook’s legal services is based on two conclu- first, sions: that Cook suffered a injury; work-related accidental second, that the services Cook received necessary reasonably However, required. Cook’s compensation workers’ claim is still pend- ing, Caterpillar’s obligation for Cook’s services is still dispute. Any possible advantage Caterpillar has yet not material- ized and cannot defeat application. the statute’s
Implicit that, argument Rosewood’s in consideration for Caterpillar’s payment, Caterpillar Rosewood could release from its obligation under the Act. legally incapable Rosewood is Cook, worker, providing injured such consideration. as the is the *8 benefits, and the compensation to receive the workers’ person entitled See 820 payments. of those assignment expressly prohibits Act (West 2004). Thus, would flow between no consideration ILCS 305/21 Caterpillar and Rosewood. Rosewood, difficult to it is consideration from
Without sufficient
agree-
the oral
making
Caterpillar’s
purpose
conclude that
main
generally Gray-
pecuniary
See
promote
ment was to
its own
interests.
Co.,
Accordingly,
violates
Electric
THE OF DEPARTMENT al., TUCKER, Trustee, Defendants-Appellants. L. et STANLEY as Third District No. 3 - 05-0277
Opinion filed June