Doxsie v. Illinois Gaming Board ( 2021 )

2021 IL App (1st) 191875FIFTH DIVISION
Opinion filed: February 19, 2021
No. 1-19-1875
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
FIRST DISTRICT
BRENDA DOXSIE d/b/a BONEYARD ) Appeal from the
BAR, ) Circuit Court of
) Cook County
Plaintiff-Respondent, )
v. )
)
THE ILLINOIS GAMING BOARD, )
an Illinois administrative agency, and, )
in their official capacities, DONALD ) No. 2018 CH 00173
R. TRACY, Chairman of the Board, )
HECTOR ALEJANDRE, Board )
Member, THOMAS A. DUNN, Board )
Member, DEE ROBINSON, Board )
Member, STEVEN C. DOLINS, Board )
Member, and MARK OSTROWSKI, )
Board Administrator, ) Honorable
) Michael T. Mullen,
Defendants-Petitioners. ) Judge, Presiding.
______________________________________________________________________________
JUSTICE HOFFMAN delivered the judgment of the court, with opinion.
Presiding Justice Delort and Justice Rochford concurred in the judgment and opinion.
OPINION
¶1 In this interlocutory appeal, the defendants, the Illinois Gaming Board (the Board); the
individual members of the Board, Donald R. Tracy, Hector Alejandre, Thomas A. Dunn, Dee
Robinson, and Steven C. Dolins; and Mark Ostrowski, the Board’s administrator, appeal the
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decision of the circuit court of Cook County granting the plaintiff, Brenda Doxsie d/b/a Boneyard
Bar’s, petition for administrative review and remanding the matter to the Board for an
administrative hearing on the plaintiff’s application for renewal of her video gaming license. For
the reasons that follow, we reverse the order of the circuit court and remand the cause for further
proceedings.
¶2 The plaintiff filed an application for renewal of a video gaming license as a licensed retail
establishment. The minutes of the Board’s August 2017 meeting reflect that it received a
recommendation from its staff that the plaintiff’s application for renewal be denied. Under the
heading “Failure to Cooperate/Active Tax Liability/failure to meet/maintain qualifications for
Licensure,” the minutes state, in reference to the plaintiff’s application for renewal: “This location
has an Active Tax Liability and does not currently have a valid liquor license. Staff recommends
non-renewal.” (Emphasis in original.)
¶3 On September 18, 2017, the plaintiff sent a facsimile message to defendants that read “All
my taxes have been paid by cash. On 9-18-2017 State Income Taxes + Sales Tax. Copy of pd.
receipts enclosed in this fax.” (Emphasis in original.) The facsimile transmission included copies
of two tax receipts issued by the Illinois Department of Revenue.
¶4 On September 21, 2017, at its monthly open session meeting, the Board denied the
plaintiff’s application for renewal of her video gaming license. On September 22, 2017, the
Board’s administrator sent a letter to the plaintiff entitled “Re: Denial of Renewal of Establishment
License.” The letter stated that the plaintiff’s renewal application was denied on two grounds: lack
of a valid liquor license and outstanding tax obligations to the State of Illinois. Regarding the
outstanding tax obligations, the letter stated that the plaintiff had “an active tax liability since April
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28, 2017,” and that an investigation revealed 18 prior instances where she had an outstanding tax
obligation to the State of Illinois. The letter informed the plaintiff that she could request a hearing;
that her request must be submitted within 10 days of delivery of the letter; and that, if a hearing is
granted, it would be de novo.
¶5 On October 2, 2017, the plaintiff sent a letter to the Board requesting a hearing on her
application for renewal. In that letter, the plaintiff requested reconsideration of the license renewal
denial, stating that she discharged her outstanding tax obligation, that she was “not aware” that
failure to pay income taxes “affected [her] gaming license,” and that she promised that “in the
future, filing and paying [her taxes] promptly will be a priority.” She concluded her letter by
requesting “leniency in the matter.”
¶6 The minutes of the Board’s November 2017 meeting, under the heading “Requests for
Hearing,” state:
“At the September 2017 meeting, the Board denied the [plaintiff’s] license renewal
application because it was delinquent in its debts and obligations to the State of Illinois,
had a history of seventeen active tax liabilities and no valid liquor license. The Request for
Hearing complied with the technical requirements of Rule 615 and maintains it satisfied its
outstanding tax liability. Currently, the Board’s records reflect this location has satisfied
its outstanding tax liability and that its liquor license is valid. However, due to its record
of incurring eighteen instances of active tax liabilities, Staff recommends denial of the
Request for failure to state a prima facie case for hearing.” (Emphasis in original.)
In her verified complaint seeking administrative review, the plaintiff asserts that: “On November
16, 2017, at the last open session Board meeting (there was no December 2017 Board meeting)
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the Board issued its Final Decision Denying Hearing.” (“The Final Decision Denying Hearing” or
“Denial”).
¶7 On December 1, 2017, the Board’s administrator sent a letter to the plaintiff entitled
“Denial of Request for Hearing Brenda Doxsie d/b/a Boneyard Bar.” The letter states that, at its
November 16, 2017 meeting, the Board denied the plaintiff’s Request for Hearing, “finding that it
did not establish a prima facie case for an administrative hearing.” The letter also states that:
“Boneyard Bar was denied renewal of its establishment license because the Board was not
provided sufficient facts or evidence in the Request that provided that the outstanding debts and
obligations to the State of Illinois had been addressed in full. The denial of your Request for
Hearing constitutes a Final Order by the Board.”
¶8 On January 5, 2018, the plaintiff filed a 5-count complaint against the defendants. Count I
was an action for administrative review, seeking, inter alia, an order reversing and vacating the
Board’s denial of the plaintiff’s video gaming location license renewal application and an order
remanding the matter to the Board with instructions to issue the plaintiff’s video the requested
renewal license. That count also sought an order reversing and vacating the Board’s decision
denying the plaintiff a hearing on her license renewal application. Counts II, III, and IV sought
injunctive relief, mandamus and injunctive relief respectively. Count V sought recovery under
section 1983 of title 42 of the United States Code (42 USC § 1983 (2018)). The circuit court
dismissed counts II, III and IV, pending determination of Count I, and dismissed Count V as
directed at the Board, but denied the motion to dismiss Count V as to the individual defendants.
¶9 Following a hearing on Count I, the plaintiff’s administrative review claim, the circuit court
entered an order on August 20, 2019, finding that the plaintiff made a prima facie case that she is
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entitled to an administrative hearing and that she is statutorily entitled to an administrative hearing
“pursuant to Section 10-65(d) (5 ILCS 100/10-65(d)) of the Administrative Procedure Act.” The
order provides that the “Court grants Plaintiff’s Count I and remands back to the Illinois Gaming
Board to conduct an administrative hearing.” The circuit court also continued the matter for status
on the plaintiff’s section 1983 claim.
¶ 10 The defendants petitioned this court for leave to file an interlocutory appeal pursuant to
Illinois Supreme Court Rule 306(a)(6) (eff. Nov. 1, 2017). We granted the defendant’s petition,
and this appeal followed.
¶ 11 Initially, we note that the plaintiff has not filed an appellee’s brief in this matter. However,
the record is short, and the claimed error is such that we can easily decide the issues without the
aid of an appellee’s brief. Accordingly, we will reach the merits of this appeal. See First Capitol
Mortgage Corp. v. Talandis Construction Corp., 63 Ill. 2d 128, 133 (1976).
¶ 12 In an interlocutory appeal brought pursuant to Illinois Supreme Court Rule 306(a)(6), we
will reverse the order of the circuit court remanding a matter for a hearing before an administrative
agency only if the circuit court has abused its discretion. Demesa v. Adams, 2013 IL App (1st)
122608, ¶ 39. A decision is deemed an abuse of discretion, only if it is “ ‘unreasonable and arbitrary
or where no reasonable person would take the view adopted by the circuit court.’ ” See Sentry
Insurance v. Continental Casualty Co., 2017 IL App (1st) 161785, ¶ 32 (quoting Gulino v.
Zurawski, 2015 IL App (1st) 131587, ¶ 64).
¶ 13 When, as in this case, an appeal is taken from an order of the circuit court entered on
administrative review, we review the administrative agency’s decision and not the factual
determinations of the circuit court. Doe Three v. Department of Public Health, 2017 IL App (1st)
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162548, ¶ 25. We apply a “clearly erroneous” standard in our review of an administrative
agency’s decision when the issue presented is a mixed question of law and fact. City of Belvidere
v. Illinois State Labor Relations Board, 181 Ill. 2d 191, 205 (1998). The decision of an
administrative agency is clearly erroneous only if the reviewing court is left with a “’definite and
firm conviction that a mistake has been committed.’” AMF Messenger Service, Inc. v. Department
of Employment Security, 198 Ill. 2d 380, 393 (2001), quoting United States v. United States
Gypsum Co., 333 U.S. 364, 395 (1948).
¶ 14 The Video Gaming Act (the Gaming Act) provides that the provisions of the Illinois
Gambling Act shall apply to the Video Gaming Act. 230 ILCS 40/80 (West 2018). The Illinois
Gambling Act states that judicial review of final orders shall be conducted in accordance with the
Administrative Review Law. 230 ILCS 10/17.1(b) (West 2018). Section 3-110 of the
Administrative Review Law provides that “[t]he findings and conclusions of the administrative
agency shall be held to be prima facie true and correct. 735 ILCS 5/3-110 (West 2018).
¶ 15 In Illinois, there is no common-law right to engage in gambling. See Dotty’s Café v. Illinois
Gaming Board, 2019 IL App (1st) 173207, ¶ 21. In this case, there is no dispute that the renewal
license the plaintiff sought was required to allow the use of video gaming terminals as defined in
the Gaming Act (230 ILCS 40/1 et seq. (West 2016)). Section 45 of the Gaming Act provides, in
relevant part, that “[t]he burden is upon each applicant to demonstrate his suitability for licensure.”
230 ILCS 40/45 (West 2016). Relevant here, the Gaming Act requires each licensed location to
have a valid liquor license “in effect at the time of application and at all times thereafter.” 230
ILCS 40/55 (West 2016). The rules adopted by the Board also require all licensees to “[k]eep
current in all payments and obligations to the State of Illinois and to other licensees with whom
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video gaming business is conducted.” 11 Ill. Adm. Code 1800.210(g) (2020). In this case, the
Board denied the plaintiff’s license renewal application based on her failure to comply with
two requirements: possession of a valid liquor license at the time of application and the
requirement that she keep current in all payments and obligations to the State of Illinois. The
factual findings supporting the Board’s September 21, 2017 decision denying the plaintiff’s
application for renewal of her video gaming license are prima facie true and correct. 735 ILCS
5/3-110 (West 2018). The plaintiff did not dispute that, at the time she filed her video gaming
license renewal application, she did not have a valid liquor license or that she was not current in
all payments and obligations to the State of Illinois. In her letter to the Board requesting a
hearing, the plaintiff asserted that she paid her sales and income tax liabilities to the State of
Illinois in cash on September 18, 2017. She also admitted that she paid her taxes that were
due in April, May, and June in the month of July. The plaintiff never claimed to have been
current in all payments and obligations to the State of Illinois at the time that she applied for a
renewal license. Nor did she assert in her letter requesting a hearing that she had a valid liquor
license in effect at the time of the application.
¶ 16 The question of whether the Board erred in its September 21, 2017 decision denying the
plaintiff’s application for renewal of her video gaming license is a mixed question of law and fact
as it involves the legal effect of a given set of facts. See City of Belvidere, 181 Ill. 2d at 205. The
Board based its denial of the plaintiff’s renewal application on two grounds: lack of a valid liquor
license and outstanding tax obligations to the State of Illinois. Those factual determinations must
be taken as prima facie true and correct. 735 ILCS 5/3-110 (West 2018). Further, there is no
evidence in the record that, at the time that the plaintiff filed her application for renewal of her
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video gaming license, either finding was inaccurate. We conclude, therefore, that the initial denial
of the plaintiff’s renewal application was not clearly erroneous.
¶ 17 Section 10-65(d) of the Administrative Procedure Act provides:
“Except as provided in subsection (c), no agency shall revoke, suspend, annul,
withdraw, amend materially, or refuse to renew any valid license without first giving
written notice to the licensee of the facts or conduct upon which the agency will rely to
support its proposed action and an opportunity for a hearing in accordance with the
provisions of this Act concerning contested cases. At the hearing, the licensee shall have
the right to show compliance with all lawful requirements for the retention, continuation,
or renewal of the license.” 5 ILCS 100/10-65(d) (West 2016).
The Administrative Procedure Act also provides that each agency shall adopt rules of practice for
formal hearings. 5 ILCS 100/5-10(a) (West 2016). The rules that the Board adopted relating to
hearings are set forth in section 1800.615 of title 11 of the Illinois Administrative Code (Code).
11 Ill. Adm. Code 1800.615 (2020). That section of the Code provides that all requests for a
hearing must be in writing and include, inter alia, “[d]etailed reasons why and the facts upon which
the petitioner will rely to show that the petitioner is suitable for licensure, including specific
responses to any facts enumerated in the Board's notice of denial.” 11 Ill. Adm. Code
1800.615(d)(2) (2020). Section 1800.615 of title 11 of the Code also provides that: “The Board
may deny a request for hearing if the statement of the reasons and facts that it contains does not
establish a prima facie case or fails to comply with any of the other requirements of this Section.”
11 Ill. Adm. Code 1800.615(g) (2020). The defendants argue that neither section 10-65(d) of the
Administrative Procedure Act nor section 1800.615 of title 11 of the Code required the Board to
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give the plaintiff an in-person hearing on her application for renewal of her video gaming license.
We agree.
¶ 18 “When interpreting a statute, the primary objective is to give effect to the legislature's
intent, which is best indicated by the plain and ordinary language of the statute itself.” Hartney
Fuel Oil Co. v. Hamer, 2013 IL 115130, ¶ 25. Here, the language of the Administrative Procedure
Act is clear; the plaintiff was entitled only to an “opportunity for a hearing.” 5 ILCS 100/10-65(d)
(West 2016). However, in order for that opportunity to progress to an in-person hearing, the
plaintiff was required to first demonstrate a prima facie case that she was suitable for licensure.
¶ 19 The question of whether the Board erred in its November 16, 2017 order denying the
plaintiff’s request for a hearing on her renewal application also presents a mixed question of law
and fact. There can be no doubt that the plaintiff was given an opportunity for a hearing as
evidenced by the letter from the Board’s administrator dated September 22, 2017. The Board
concluded, however, that, although the plaintiff had resolved her past due tax obligations, the
failure to keep her taxes current rendered her unsuitable for license renewal. The plaintiff’s request
for a hearing did not allege that the defendants’ factual findings were erroneous in any way. To
the contrary, the plaintiff admitted that she failed to pay her tax obligations promptly and did not
mention the liquor license issue. There was no allegation that the Board had misapplied or
misinterpreted the statute or regulations related to licensure. Based on those facts, we cannot say
that the Board’s determination that the plaintiff failed to meet the requirement of establishing a
prima facie case entitling her to a hearing was clearly erroneous.
¶ 20 Having concluded that neither the Board’s September 21, 2017 decision denying the
plaintiff’s application for renewal of her video gaming license nor its November 16, 2017 order
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denying the plaintiff’s request for a hearing is clearly erroneous, we find that the circuit court’s
order remanding this matter to the Board to conduct an administrative hearing on the plaintiff’s
renewal application was an abuse of discretion. Accordingly, we reverse the circuit court’s order
of August 20, 2019, and remand this matter for further proceedings not inconsistent with this
opinion.
¶ 21 Reversed and remanded.
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