Grady v. Illinois Department of Healthcare & Family Services

Digitally signed by
Reporter of Decisions
Illinois Official Reports Reason: I attest to the
accuracy and
integrity of this
document
Appellate Court Date: 2017.01.18
11:07:09 -06'00'
Grady v. Illinois Department of Healthcare & Family Services,
2016 IL App (1st) 152402
Appellate Court LAURETTA GRADY, Plaintiff-Appellant, v. THE ILLINOIS
Caption DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES
and JULIE HAMOS, Director, Defendants-Appellees.
District & No. First District, Third Division
Docket No. 1-15-2402
Filed November 2, 2016
Decision Under Appeal from the Circuit Court of Cook County, No. 14-CH-20233; the
Review Hon. Mary L. Mikva, Judge, presiding.
Judgment Reversed and remanded with directions.
Counsel on Legal Assistance Foundation, of Chicago (Miriam Hallbauer, of
Appeal counsel), for appellant.
Lisa Madigan, Attorney General, of Chicago (Carolyn E. Shapiro,
Solicitor General, and Paul Racette, Assistant Attorney General, of
counsel), for appellees.
Panel JUSTICE COBBS delivered the judgment of the court, with opinion.
Presiding Justice Fitzgerald Smith and Justice Lavin concurred in the
judgment and opinion.
OPINION
¶1 Plaintiff Lauretta Grady appeals from the dismissal with prejudice of her complaint
seeking judicial review of an administrative decision nominally rendered by the Illinois
Department of Human Services (DHS) regarding her eligibility for a Medicaid program. In her
complaint, plaintiff named the Illinois Department of Healthcare and Family Services (DHFS)
and its director, Julie Hamos, as defendants but not DHS or that agency’s head. On appeal,
plaintiff contends that the trial court erred in dismissing her complaint for failure to name
required parties, arguing that DHFS has the statutory authority to determine questions of
Medicaid eligibility and consequently was the proper defendant. Alternatively, she contends
that if she failed to name the proper parties she was entitled to amend her complaint to correct
the error, pursuant to subsection 3-107(a) of the Administrative Review Law (735 ILCS
5/3-107(a) (West 2014)). For the reasons that follow, we find plaintiff failed to name the
proper defendant in her complaint but was entitled to amend her complaint. We reverse and
remand.
¶2 BACKGROUND
¶3 Plaintiff participates in the Home Services Plan, a program intended to prevent
unnecessary institutionalization of individuals, pursuant to the Traumatic Brain Injury
Medicaid Waiver Program. As part of the plan, participants take part in regular reassessments
to determine their continued eligibility and needs. Following a reassessment in June 2014,
plaintiff was assigned a plan that granted her 155 hours of medical services per month.
¶4 Subsequently, plaintiff filed an administrative appeal of the plan, seeking additional hours
for an assistant to aid with certain therapies prescribed by her doctor. An administrative
hearing was held before an officer of DHS, and the officer recommended a new service plan
with marginally increased hours. The caption atop the officer’s written decision stated
“STATE OF ILLINOIS DEPARTMENT OF HUMAN SERVICES,” and the decision’s first
paragraph indicated that the officer was a hearing officer for “the Department of Human
Services *** Bureau of Hearings.” The officer later noted that “the Department of Human
Services has jurisdiction” over the administrative appeal. The decision’s final page was signed
by Michelle R.B. Saddler, the secretary of DHS at the time, and indicated that Saddler was
adopting the findings and recommendations of the hearing officer. The decision was sent to
plaintiff with a cover letter, signed by Saddler and indicating that the “Illinois Department of
Human Services reviewed” her appeal.
¶5 Alleging that the increased hours were still insufficient, plaintiff appealed the
administrative decision in a complaint filed in the Cook County circuit court on December 18,
2014. The complaint did not name DHS or Saddler as defendants; instead, it named DHFS and
its then-director, Hamos. Defendants moved to dismiss the complaint without leave to amend,
arguing that DHS was a necessary party because it had issued the decision to be reviewed.
Plaintiff responded that DHFS was the agency responsible under the law for rendering the
decision to be reviewed and thus was the correct party. She also argued alternatively that the
court was required to grant her 35 days to serve the correct defendant and that any mistake
should be excused as a “good faith” error.
¶6 Before the trial court made its ruling on the motion to dismiss, the Appellate Court, Fourth
District, rendered its decision in Mannheim School District No. 83 v. Teachers’ Retirement
-2-
System, 2015 IL App (4th) 140531, holding that subsection 3-107(a) of the Administrative
Review Law does not require leave to amend a complaint “to include the agency that rendered
the final decision as a defendant when an individual member of that agency was not named.”
Id. ¶ 28. Defendants were granted leave to cite Mannheim as additional authority, and plaintiff
responded that the case was wrongly decided. In a written order, the trial court granted the
State’s motion to dismiss, stating that plaintiff’s failure to name DHS was fatal to her claim.
The court also denied plaintiff leave to amend, explaining that although it agreed that
Mannheim was wrongly decided, it was bound by the Fourth District’s holding.
¶7 ANALYSIS
¶8 Plaintiff first contends that defendants were properly named in her suit because the
Administrative Review Law (735 ILCS 5/3-101 et seq. (West 2014)) requires the agency
“having power under the law to make administrative decisions” to be named as defendant.
Citing Gillmore v. Illinois Department of Human Services, 218 Ill. 2d 302 (2006), she argues
that “power under the law” refers solely to power under the relevant statute and that DHFS has
the statutory authority to determine Medicaid eligibility. Defendants respond that the
Administrative Review Law requires that the agency that actually issued a ruling be named as
defendant. They argue that it is clear from the record that DHS issued the determination in
question and thus DHS should have been named as defendant.
¶9 Where the circuit court has granted a motion to dismiss filed pursuant to section 2-619 of
the Code of Civil Procedure (735 ILCS 5/2-619 (West 2014)), as occurred in this case, our
review is de novo. Rodriguez v. Sheriff’s Merit Comm’n, 218 Ill. 2d 342, 349 (2006). Plaintiff
raises matters of statutory interpretation, which are similarly reviewed de novo. Skaperdas v.
Country Casualty Insurance Co., 2015 IL 117021, ¶ 15.
¶ 10 When construing a statute, our primary objective is to ascertain and give effect to the
legislature’s intent through giving the statutory language its plain and ordinary meaning.
People v. Lloyd, 2013 IL 113510, ¶ 25. If the language is clear and unambiguous, a court may
not deviate from that language by inferring exceptions or conditions that the General Assembly
did not set forth. Wilkins v. Williams, 2013 IL 114310, ¶ 22. However, statutory interpretation
“cannot always be reduced to ‘the mechanical application of the dictionary definitions of the
individual words and phrases involved.’ ” People v. Wood, 379 Ill. App. 3d 705, 708-09 (2008)
(quoting Whelan v. County Officers’ Electoral Board, 256 Ill. App. 3d 555, 558 (1994)). A
court should not read language in an excessively literal fashion such that it produces an absurd
construction. See id. at 709.
¶ 11 The Administrative Review Law governs all proceedings in which a party seeks judicial
review of an administrative eligibility decision under article V of the Illinois Public Aid Code
(305 ILCS 5/5-1 (West 2014)). Gillmore, 218 Ill. 2d at 314; see also 305 ILCS 5/11-8.7 (West
2014). Subsection 3-107(a) of the Administrative Review Law requires that “in any action to
review any final decision of an administrative agency, the administrative agency and all
persons, other than the plaintiff, who were parties of record to the proceedings before the
administrative agency shall be made defendants.” 735 ILCS 5/3-107(a) (West 2014).
¶ 12 Section 3-101 of the Administrative Review Law sets forth the applicable definitions. 735
ILCS 5/3-101 (West 2014). “Administrative agency” is defined as “a person, body of persons,
group, officer, board, bureau, commission or department (other than a court or judge) of the
State, or of any political subdivision of the State or municipal corporation in the State, having
-3-
power under law to make administrative decisions.” Id. The Administrative Review Law
defines an “administrative decision” as “any decision, order or determination of any
administrative agency rendered in a particular case, which affects the legal rights, duties or
privileges of parties and which terminates the proceedings before the administrative agency.”
Id.
¶ 13 The Administrative Review Law clearly requires that when an individual seeks review of
an administrative agency decision, that agency must be named as a defendant. The only natural
reading of subsection 3-107(a) indicates that the phrase “the administrative agency” that is the
subject of the subsection’s requirement refers to the same entity as the phrase “an
administrative agency,” which occurs in the prepositional phrase immediately preceding it.
See 305 ILCS 5/11-8.7 (West 2014). We must therefore conclude that “the administrative
agency” required by statute to be named a defendant is the agency that issued the challenged
decision. We note that a contrary conclusion could lead to the highly impractical result of an
agency being required to defend a decision which it took no part in making.
¶ 14 It is clear from the record that the decision plaintiff seeks to review was issued by DHS and
not DHFS. The proceedings were held before a DHS hearing officer, and the decision itself
clearly designated DHS as the issuing body. The decision was sent to plaintiff along with a
letter indicating that her case had been reviewed by DHS. There is nothing in the record that
suggests that DHFS took any part in the challenged decision. Accordingly, DHS was required
to be named as defendant.
¶ 15 Plaintiff argues that the Administrative Review Law defines an administrative agency as
an entity “having power under the law to make administrative decisions” and therefore the
administrative agency referred to in subsection 3-107(a) must be an agency having power
under the law to make the challenged administrative decisions. She then discusses at length the
legislative history of DHFS in arguing that the agency has the power under the law to issue
Medicaid eligibility decisions. In so arguing, plaintiff relies on our supreme court’s opinion in
Gillmore.
¶ 16 In Gillmore, the plaintiff sought review of a DHS decision finding her eligible for
Medicaid benefits but imposing a penalty based upon a rule promulgated by the Illinois
Department of Public Aid (DPA), the state Medicaid agency at the time. Gillmore, 218 Ill. 2d
at 304-06. The decision was signed by the DHS secretary and the DPA director and included a
cover letter stating that it was the decision of DHS and DPA. Id. at 310. Before addressing the
merits of plaintiff’s appeal, the supreme court briefly addressed DHS’s contention that the case
must be dismissed because plaintiff had not served a copy of the complaint on DPA. Id. at
313-15. The supreme court reviewed the Illinois Public Aid Code (305 ILCS 5/12-1 et seq.
(West 2002)) applicable at the time and held that DHS had the power under the law to
determine eligibility issues. Gillmore, 218 Ill. 2d at 313-15. The court explained that where
two agencies share the power to render an administrative decision, both must be made
defendants in a suit for judicial review. Id. at 314. However, noting that only DHS “had the
power to decide” plaintiff’s Medicaid eligibility, the court ruled that DPA had only endorsed
DHS’s decision pursuant to federal regulations and was therefore not a required party. Id. at
314-15.
¶ 17 We find Gillmore distinguishable from the current case. In that case, the plaintiff had
named only one of two agencies indicated on an administrative decision, and thus our supreme
court considered which of the two agencies was responsible for the decision that both had
-4-
clearly approved. In this case, there is no question of which agency rendered the challenged
decision, and therefore the analysis used by the supreme court in Gillmore is inapposite.
Accordingly we need not consider which agency ultimately had the statutory power to address
plaintiff’s eligibility.1
¶ 18 Plaintiff also argues that her case should not have been dismissed because DHS was acting
as an agent of DHFS based upon an interagency delegation of power. See 735 ILCS 5/3-107(a)
(West 2014) (“No action for administrative review shall be dismissed for lack of jurisdiction
based upon the failure to name an *** agent ***, where the administrative agency *** has
been named as a defendant ***.”). However, this agency argument was not raised before the
trial court and is therefore forfeited. See Mabry v. Boler, 2012 IL App (1st) 111464, ¶ 15
(“Generally, arguments not raised before the circuit court are forfeited and cannot be raised for
the first time on appeal.”).
¶ 19 Plaintiff contends alternatively that the trial court erred in denying her request for leave to
amend her complaint and add DHS as a defendant, arguing that the language of subsection
3-107(a) of the Administrative Review Law clearly mandates that plaintiff be allowed to
amend her complaint to add unnamed parties. Acknowledging that this argument is contrary to
the Fourth District’s recent opinion in Mannheim, plaintiff argues that this court should reject
the opinion as wrongly decided. The State responds that Mannheim was correctly decided and
that the complaint could only be amended to add an agency defendant if the head of that
agency was originally named as a defendant.
¶ 20 Subsection 3-107(a) is comprised of three paragraphs. The first, previously discussed, sets
forth the parties that must be made defendants in an action for judicial review of an
administrative decision, as well as the method of service required. 735 ILCS 5/3-107(a) (West
2014). The second paragraph states:
“No action for administrative review shall be dismissed for lack of jurisdiction
based upon the failure to name an employee, agent, or member, who acted in his or her
official capacity, of an administrative agency, board, committee, or government entity,
where the administrative agency, board, committee, or government entity, has been
named as a defendant as provided in this Section. Naming the director or agency head,
in his or her official capacity, shall be deemed to include as defendant the
administrative agency, board, committee, or government entity that the named
defendants direct or head. No action for administrative review shall be dismissed for
lack of jurisdiction based upon the failure to name an administrative agency, board,
committee, or government entity, where the director or agency head, in his or her
official capacity, has been named as a defendant as provided in this Section.” Id.
Finally, the third paragraph, at issue in the case at bar, indicates:
“If, during the course of a review action, the court determines that an agency or a
party of record to the administrative proceedings was not made a defendant as required
by the preceding paragraph, then the court shall grant the plaintiff 35 days from the date
of the determination in which to name and serve the unnamed agency or party as a
1
We note, as the trial court did below, that if plaintiff truly sought to challenge defendants’ ability to
render a decision as to her eligibility, she could have named DHS as defendant and challenged the
decision as void. See, e.g., Crittenden v. Cook County Comm’n of Human Rights, 2013 IL 114876.
-5-
defendant. The court shall permit the newly served defendant to participate in the
proceedings to the extent the interests of justice may require.” Id.
¶ 21 The Appellate Court, Fourth District, recently considered subsection 3-107(a)’s third
paragraph in Mannheim under facts similar to the case at bar. In that case, the plaintiff sought
judicial review of a decision by the Board of Trustees of the Teachers’ Retirement System of
Illinois but failed to name the agency or its head as defendant. Mannheim, 2015 IL App (4th)
140531, ¶ 3. The trial court dismissed the complaint and denied the plaintiff’s motion to amend
it to include the proper defendants. Id. ¶ 7. The Fourth District held that the plaintiff was not
entitled to amend its complaint, finding that the “strict language” of subsection 3-107(a)
specifies that a plaintiff is only allowed to amend in the circumstances laid out in the
subsection’s second paragraph: “(1) the individual employee, agent, or member who acted in
his or her official capacity can be added when the plaintiff has named the administrative
agency, board, committee, or government entity ‘as provided in this section’; or (2) the
administrative agency, board, committee, or government entity can be added when the plaintiff
has named the director or agency head, in his or her official capacity, ‘as provided in this
section.’ ” Id. ¶ 22 (quoting 735 ILCS 5/3-107(a) (West 2012)).
¶ 22 Plaintiff did not name DHS or its secretary as defendant in her complaint; thus under the
reasoning of Mannheim, she would not be entitled to add either entity as a defendant. However,
we decline to follow Mannheim for the following reasons.
¶ 23 First, it is clear that the Fourth District found that the reference to “the preceding
paragraph” in subsection 3-107(a)’s third paragraph was intended to direct the reader to the
subsection’s second paragraph because the court limited the subsection’s mandate to allow
amendment to the circumstances described in that paragraph. Although we acknowledge that
the court’s understanding of the phrase is a plausible reading of the statute, we do not agree that
it is the best or most natural reading. In statutory interpretation, a reviewing court must view
each phrase or part of the legislation in the context of the statute as a whole. Ultsch v. Illinois
Municipal Retirement Fund, 226 Ill. 2d 169, 184 (2007). The phrase “the preceding paragraph”
by itself could be read to mean the immediately preceding paragraph; however, the statute
indicates that the preceding paragraph in question requires that “an agency or a party of record
to the administrative proceedings” be made a defendant. 735 ILCS 5/3-107(a) (West 2014). Of
the two paragraphs that precede this language, only the subsection’s first paragraph details
which parties are required to be named defendant. Id. By contrast, the second paragraph sets
forth no requirements but indicates two situations in which unnamed parties cannot be the
basis for a dismissal and therefore are not required to be named. See id. Thus, we find that the
legislature intended “the preceding paragraph” to refer to the subsection’s initial paragraph,
despite it not being immediately prior. Consequently, the third paragraph’s mandate to allow
amendments is not limited to the circumstances described in the second paragraph, as the
Fourth District held.
¶ 24 This reading of “the preceding paragraph” is supported by an examination of the legislative
history of the statute. In 1995, subsection 3-107(a) consisted of only two paragraphs, with the
first paragraph being substantially similar to the current first paragraph’s description of
required parties and the second paragraph being substantially similar to the current third
paragraph. 735 ILCS 5/3-107(a) (West 1996). In 1996, the legislature amended the
subsection’s first paragraph, adding the language that currently constitutes the subsection’s
second paragraph; however, the subsection remained as two paragraphs. See 735 ILCS
-6-
5/3-107(a) (West 1998). Thus, prior to 2008, the phrase “the preceding paragraph” clearly
referred to the statute’s first paragraph explaining the required parties. However, in 2008, the
legislature amended the statute again, adding two sentences regarding service to the first
paragraph and reformatting the subsection into its current three paragraphs. See 735 ILCS
5/3-107(a) (West 2010). This reformatting resulted in the phrase “the preceding paragraph”
being distanced from its original referent, but there is no indication that this stylistic
restructuring was intended to substantively alter the phrase’s meaning.
¶ 25 Moreover, we note that appellate courts are not permitted to interpret statutory language in
a manner that renders any part of the statute “redundant” or “superfluous.” Citizens Opposing
Pollution v. ExxonMobil Coal U.S.A., 2012 IL 111286, ¶ 29. If the phrase “the preceding
paragraph” is read to limit the ability to amend to the situations found in the second paragraph,
then the third paragraph is rendered superfluous. The second paragraph of the subsection states
that naming the head of an administrative agency as a defendant “shall be deemed to include as
defendant the administrative agency.” 735 ILCS 5/3-107(a) (West 2014). Additionally the
second paragraph states that a case cannot be dismissed under either of the circumstances
listed. Id. Accordingly, it would be unnecessary to add a party already “deemed” to be included
or to amend the complaint in circumstances that cannot lead to a dismissal. If the third
paragraph is limited by the second paragraph, as the Mannheim court found, then a plaintiff is
only permitted to amend the complaint in situations where amendment would be unnecessary.
Such a reading would impermissibly render the paragraph superfluous.
¶ 26 Subsection 3-107(a) mandates that if a court determines that a plaintiff has failed to name
an agency or party of record as a defendant “then the court shall grant the plaintiff 35 days from
the date of the determination in which to name and serve the unnamed agency or party as a
defendant.” Id. As we find this mandate is not limited to the circumstances included in the
subsection’s second paragraph, plaintiff was entitled to amend her complaint within 35 days
from the date the trial court determined that DHS was a required party. We therefore reverse
the judgment of the circuit court dismissing plaintiff’s complaint with prejudice and remand
the case to the circuit court to allow plaintiff 35 days to amend her complaint to name the
required defendants and serve them.
¶ 27 CONCLUSION
¶ 28 For the foregoing reasons, we find that plaintiff failed to name the correct parties as
defendants in her complaint under the Administrative Review Law but was entitled to the
opportunity to amend her complaint to name the proper parties pursuant to subsection
3-107(a). 735 ILCS 5/3-107(a) (West 2014). Accordingly, we reverse the judgment of the
circuit court of Cook County and remand the case to allow plaintiff to amend her complaint.
¶ 29 Reversed and remanded with directions.
-7-