The Village of Vernon Hills v. Heelan

2014 IL App (2d) 130823
No. 2-13-0823
Opinion filed July 23, 2014
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
SECOND DISTRICT
______________________________________________________________________________
THE VILLAGE OF VERNON HILLS, ) Appeal from the Circuit Court
) of Lake County.
Plaintiff and Counterdefendant- )
Appellant and Cross-Appellee, )
)
v. ) No. 11-MR-1683
)
WILLIAM J. HEELAN, )
) Honorable
Defendant and Counterplaintiff- ) Margaret J. Mullen,
Appellee and Cross-Appellant. ) Judge, Presiding.
______________________________________________________________________________
JUSTICE ZENOFF delivered the judgment of the court, with opinion.
Justice Spence concurred in the judgment and opinion.
Justice McLaren dissented, with opinion.
OPINION
¶1 The Board of Trustees of the Vernon Hills Police Pension Fund (Board) awarded a line-
of-duty disability pension (40 ILCS 5/3-114.1 (West 2010)) to defendant, police officer William
J. Heelan. Thereafter, plaintiff, the Village of Vernon Hills (Village), filed a complaint in the
trial court seeking a declaratory judgment that it was not obligated under section 10 of the Public
Safety Employee Benefits Act (Act) (820 ILCS 320/10 (West 2010)) to pay the health insurance
premiums for Heelan, his wife, and his two children. Heelan filed a counterclaim seeking a
2014 IL App (2d) 130823
declaratory judgment that the Village was obligated under the Act.1 The Village appeals from
the trial court’s declaratory judgment in Heelan’s favor; Heelan cross-appeals from the trial
court’s denial of his motion for sanctions under Illinois Supreme Court Rule 137 (eff. July 1,
2013). For the following reasons, we affirm.
¶2 I. BACKGROUND
¶3 In December 2009, while on patrol, Heelan, a 20-year veteran of the Village’s police
department, was dispatched to a “panic call alarm.” Upon arrival at the scene, Heelan saw an
unknown man exiting a building. As he quickly approached the man, Heelan slipped on a patch
of ice and fell on his right side at the edge of a curb. Heelan was taken by ambulance to a
hospital emergency room, where he was X-rayed, prescribed pain medication, and released. He
followed up with various physicians and underwent physical therapy. An MRI showed that
Heelan suffered a labral tear in his right hip.
¶4 Dr. Jay Levin conducted an independent medical evaluation of Heelan in connection with
a claim Heelan filed under the Workers’ Compensation Act (820 ILCS 305/1 et seq. (West
2010)). Dr. Levin opined that the December 2009 incident had aggravated Heelan’s preexisting
right hip osteoarthritis. According to Heelan, prior to the incident, he had not experienced any
pain or problems from arthritis.
¶5 During the year following the incident, the Village paid Heelan his full salary pursuant to
the Public Employee Disability Act (5 ILCS 345/1 (West 2010)). Heelan underwent a right hip
replacement in April 2010. After this surgery, Heelan returned to work on light duty for about
1
In his counterclaim, Heelan also sought attorney fees pursuant to the Attorneys Fees in
Wage Actions Act (705 ILCS 225/1 (West 2010)). The trial court granted the Village’s motion
for summary judgment on this claim. This order is not at issue in this appeal.
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2014 IL App (2d) 130823
two months. His right hip replacement exacerbated his left hip osteoarthritis, and Heelan
underwent a left hip replacement in September 2010. He did not return to work after this second
surgery. Heelan and the Village subsequently settled Heelan’s workers’ compensation claim in a
lump-sum agreement.
¶6 In December 2010, Heelan filed an application for a line-of-duty disability pension under
section 3-114.1 of the Illinois Pension Code (40 ILCS 5/3-114.1 (West 2010)). The Board
conducted a hearing on June 28, 2011. Pursuant to section 3-115 of the Illinois Pension Code
(40 ILCS 5/3-115 (West 2010)), the Board admitted into evidence the reports of three physicians
selected by the Board—Dr. Joseph Meis, Dr. Thomas Gleason, and Dr. Joshua Jacobs. Drs.
Meis and Jacobs each certified that Heelan was “disabled to a point that he [was] not able to
perform his duties as a police officer.” Dr. Meis identified Heelan’s hip replacements as the
conditions that disabled him, while Dr. Jacobs identified Heelan’s right and left hip osteoarthritis
as the disabling conditions. Dr. Jacobs further certified that it was “medically possible” that
Heelan’s disability resulted from an act of duty or the cumulative effects of acts of duty,
specifically identifying the December 2009 incident as the cause of Heelan’s disability. Dr.
Gleason, on the other hand, opined in his report that Heelan was not disabled to a point of being
unable to perform his police duties, “unless police procedure to incarcerate arrested persons as
required exceeds the medium level as defined by the [Illinois] Department of Labor Guidelines.”
Dr. Gleason certified that, if Heelan were disabled, it was medically possible that his disability
resulted from an act of duty or the cumulative effects of acts of duty.
¶7 The Board also heard telephone testimony from Dr. Gleason. Dr. Gleason testified that
he would not recommend that Heelan engage a 200-pound person resisting arrest or run after a
fleeing suspect. Dr. Gleason agreed on cross-examination that, if the service requirements of the
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Village police department exceeded the medium level of the Department of Labor guidelines,
Heelan was disabled. After considering the evidence, the Board determined that Heelan
qualified for a line-of-duty disability pension and it adopted its written findings and decision on
August 24, 2011.
¶8 On September 22, 2011, the Village filed its complaint seeking a declaratory judgment
that Heelan was not eligible for health insurance benefits under the Act. In its complaint, the
Village alleged that Heelan had not suffered a catastrophic injury, as required by section 10(a) of
the Act (820 ILCS 320/10(a) (West 2010)), and that Heelan’s injury had not resulted from his
response to what he reasonably believed to be an emergency, as required under section 10(b) of
the Act (820 ILCS 320/10(b) (West 2010)). The Village acknowledged Krohe v. City of
Bloomington, 204 Ill. 2d 392 (2003), in which the court held that a catastrophic injury is
synonymous with an injury resulting in a line-of-duty disability pension, but the Village asserted
that Krohe was factually distinguishable and did not address the issues raised in the Village’s
complaint. Heelan answered the complaint and filed his counterclaim seeking a declaratory
judgment that the Village was obligated to provide the insurance benefits.
¶9 On June 4, 2012, the Village filed notices of deposition of Drs. Levin, Meis, Jacobs, and
Gleason. Heelan moved to strike the depositions, arguing that the testimony would not be
relevant to the proceedings or, alternatively, that the Village was collaterally estopped from
contesting Heelan’s injury. On August 24, 2012, the trial court granted Heelan’s motion to
strike, relying on Krohe and its progeny. The court noted that in Krohe the supreme court held
the term “catastrophic injury” in section 10(a) of the Act is a term of art meaning an injury
resulting in the award of a line-of-duty disability pension (see Krohe, 204 Ill. 2d at 400). The
court elaborated, “I know that because not only does Krohe say it, but the Nowak case [(Nowak
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2014 IL App (2d) 130823
v. City of Country Club Hills, 2011 IL 111838)] says it. Also, it’s an Illinois Supreme Court
case. And the Second District in the Richter case [(Richter v. Village of Oak Brook, 2011 IL
App (2d) 100114)] says Krohe says it. So if I needed any reassurance, I certainly have it in those
cases that construe Krohe.” The Village subsequently filed a motion to reconsider the court’s
ruling, which the court denied.
¶ 10 On February 26, 2013, Heelan filed a motion in limine to bar any testimony on the issue
of whether he had suffered a catastrophic injury under section 10(a) of the Act. Heelan argued
that the Village was collaterally estopped from asserting that he did not suffer a catastrophic
injury. Relying on the trial court’s August 24, 2012, order granting his motion to strike the
depositions, Heelan further contended that, under Krohe, the Village was prohibited from
denying that he suffered a catastrophic injury. The court granted the motion in limine.
¶ 11 On March 18, 2013, the matter proceeded to a bench trial. The Village conceded that
section 10(b) of the Act was satisfied, indicating that it was not contesting that, during the
December 2009 incident, Heelan was responding to what he reasonably believed to be an
emergency. In light of the court’s prohibition of testimony regarding whether Heelan suffered a
catastrophic injury under section 10(a), the Village made an offer of proof as to that issue. The
Village rested its case, and Heelan moved for a directed finding, which the court granted.
¶ 12 Heelan then presented evidence to support his counterclaim. When Heelan began
testifying about his belief as to the emergency nature of the December 2009 incident, the Village
objected on relevance grounds in light of its concession regarding section 10(b) of the Act. The
court sustained the objection and allowed Heelan to make an offer of proof. Heelan then
testified about his application for, and the Board’s award of, a line-of-duty disability pension.
The Board’s written decision also was admitted into evidence. Heelan testified that, following
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2014 IL App (2d) 130823
the award of his pension, he sought from the Village health insurance benefits under the Act. He
explained that the parties agreed that, to avoid a lapse in insurance coverage during the pendency
of the litigation, the Village would continue to pay the premiums for Heelan, while Heelan
would pay the premiums for his family. When Heelan rested his case on his counterclaim, the
Village moved for a directed finding, which the court denied. The Village presented its evidence
on Heelan’s counterclaim and renewed its motion for a directed finding. The court denied the
Village’s renewed motion and found that Heelan had sustained his proofs.
¶ 13 On March 20, 2013, the trial court entered a written order in Heelan’s favor on the
Village’s complaint and on Heelan’s counterclaim.2 The court awarded Heelan benefits under
the Act, retroactive to August 24, 2011, when the Board had issued its written decision.
¶ 14 On May 24, 2013, Heelan filed a motion for sanctions against the Village pursuant to
Supreme Court Rule 137. In his motion, Heelan argued that the Village brought its suit only to
harass him and cause him unnecessary expense. According to Heelan, because the Village’s
complaint acknowledged both the Krohe decision and the fact that he had received a line-of-duty
disability pension, the Village knew that he was entitled to benefits under the Act and, therefore,
did not act in good faith in filing suit. The Village responded that it pursued this action in good
faith because it presented unique facts and arguments not previously addressed by Krohe and its
progeny. The Village also argued that it permissibly advocated for modification of existing law.
The trial court denied Heelan’s motion for sanctions, finding that the evidence indicated no bad
faith by the Village. The court further found that the Village had made it clear from the
beginning that it was seeking to change the law.
¶ 15 On July 18, 2013, the trial court entered its final judgment. The Village timely appeals,
2
The case continued on matters not at issue in this appeal.
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2014 IL App (2d) 130823
and Heelan timely cross-appeals. We granted the Illinois Municipal League’s motion to
intervene as amicus curiae and to file a brief in support of the Village.
¶ 16 II. ANALYSIS
¶ 17 A. The Village’s Appeal
¶ 18 The Village appeals from the trial court’s judgment that it was obligated under the Act to
provide health insurance benefits to Heelan and his family. The purpose of the Act is “to ensure
the health benefits of public safety employees who have suffered career-ending injuries.”
Richter, 2011 IL App (2d) 100114, ¶ 16. Under section 10 of the Act, injured law enforcement
officers and firefighters, and their families, are entitled to have their municipality pay their health
insurance premiums if two conditions are satisfied. 820 ILCS 320/10 (West 2010); Richter,
2011 IL App (2d) 100114, ¶ 16. Section 10(a) of the Act requires the employee to have suffered
a “catastrophic injury” or to have been killed in the line of duty. 820 ILCS 320/10(a) (West
2010); Richter, 2011 IL App (2d) 100114, ¶ 16. Section 10(b) of the Act provides in relevant
part that the employee must have been injured or killed as a result of his or her “response to what
is reasonably believed to be an emergency.” 820 ILCS 320/10(b) (West 2010); Richter, 2011 IL
App (2d) 100114, ¶ 16. In the trial court, the Village conceded that Heelan satisfied section
10(b). Thus, the issue before us is whether he satisfied section 10(a).
¶ 19 The Act does not define the term “catastrophic injury.” In 2003, our supreme court held
that the term was ambiguous. Krohe, 204 Ill. 2d at 395. The court considered the legislative
history and debates, concluding that they “could not be clearer.” Krohe, 204 Ill. 2d at 398. The
court held that the legislature intended the term “catastrophic injury” to be “synonymous with an
injury resulting in a line-of-duty disability under section 4-110 of the [Pension] Code.” Krohe,
204 Ill. 2d at 400 (referring to 40 ILCS 5/4-110 (West 2000); this section of the Pension Code
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2014 IL App (2d) 130823
provides for line-of-duty disability pensions for firefighters and is similar to section 3-114.1,
which provides for police officers’ line-of-duty disability pensions); see also Nowak, 2011 IL
111838, ¶ 12 (supreme court reaffirming its holding in Krohe and applying it where a police
officer was injured). Following Krohe, this court explained in Richter:
“Under Krohe, the pension board’s decision [to award the plaintiff-firefighter a line-of-
duty disability pension] establishes that the plaintiff suffered a catastrophic injury, thus
meeting the requirements of section 10(a) of [the Act]. This is not an application of
collateral estoppel. Rather, because the legislature intended an injured firefighter or
police officer to be eligible for benefits under section 10(a) of [the Act] whenever his or
her injuries were sufficient to qualify for a line-of-duty pension, the pension board’s
determination in this regard establishes as a matter of law that the firefighter or police
officer received a catastrophic injury.” Richter, 2011 IL App (2d) 100114, ¶ 16.
The issue of whether Heelan satisfied section 10(a) of the Act by virtue of having been awarded
a line-of-duty disability pension presents a question of law, which we review de novo. See
Richter, 2011 IL App (2d) 100114, ¶¶ 14, 16.
¶ 20 In the present case, it is undisputed that the Board awarded Heelan a line-of-duty
disability pension. Therefore, it is an uncontroverted fact that he was catastrophically injured for
purposes of section 10(a) of the Act. See Krohe, 204 Ill. 2d at 400; Richter, 2011 IL App (2d)
100114, ¶ 16. In light of the Village’s concession with respect to section 10(b) of the Act, the
trial court correctly entered judgment in favor of Heelan on the Village’s complaint and on
Heelan’s counterclaim. See Pyle v. City of Granite City, 2012 IL App (5th) 110472, ¶ 20
(holding that the plaintiff-firefighter was entitled to benefits under the Act because the plaintiff
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2014 IL App (2d) 130823
had been awarded a line-of-duty disability pension and the parties did not dispute that his injuries
occurred as a result of his response to an emergency).
¶ 21 Nevertheless, the Village argues that Krohe, Richter, and Nowak do not control, because
the courts in those cases did not consider whether a trial court may prohibit a municipality from
engaging in discovery or presenting evidence disputing that an injury was catastrophic.
According to the Village, “much confusion” has resulted from Krohe. We disagree.
¶ 22 In Krohe, our supreme court addressed the question of whether the term “catastrophic
injury” in section 10(a) of the Act is synonymous with an injury resulting in a line-of-duty
disability pension. Krohe, 204 Ill. 2d at 394. The court’s answer to that question was an
unequivocal yes. Krohe, 204 Ill. 2d at 394, 400.
¶ 23 In Richter, this court considered the plaintiff-firefighter’s contention that, after he was
awarded a line-of-duty disability pension, “under the principle of collateral estoppel he ha[d] the
right to judgment as a matter of law” on his claim under the Act. Richter, 2011 IL App (2d)
100114, ¶ 14. We explained that the doctrine of collateral estoppel “prohibits the relitigation of
an issue actually decided in an earlier proceeding between the same parties.” Richter, 2011 IL
App (2d) 100114, ¶ 17. We then addressed section 10(a) of the Act. Relying on Krohe, we held
that the pension board’s awarding the plaintiff a line-of-duty disability pension established that
the plaintiff had suffered a catastrophic injury under section 10(a) of the Act. Richter, 2011 IL
App (2d) 100114, ¶ 16. Turning to section 10(b) of the Act, we held that the defendant-village
was collaterally estopped (by proceedings under the Workers’ Compensation Act) from
relitigating the issue of whether the plaintiff’s first shoulder injury was a contributing cause of
his disability. Richter, 2011 IL App (2d) 100114, ¶ 24.
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¶ 24 We agree with the Village that our analysis and holding in Richter regarding section
10(b) of the Act are not relevant here, because the Village conceded that element. However, we
disagree with the Village’s conclusion that our analysis and holding in Richter regarding section
10(a) was dicta. In Richter, following a bench trial, the plaintiff challenged the trial court’s
judgment with respect to his claim under the Act; thus, we necessarily had to address the
requirements of both sections of the Act.
¶ 25 In Nowak, the supreme court considered the issue of when a municipality’s obligation
attaches under the Act. Nowak, 2011 IL 111838, ¶ 9. The court also clearly reaffirmed its
holding in Krohe—that the term “catastrophic injury” as used in section 10(a) of the Act is
synonymous with an injury resulting in the award of a line-of-duty disability pension. Nowak,
2011 IL 111838, ¶ 12; see also Gaffney v. Board of Trustees of the Orland Fire Protection
District, 2012 IL 110012, ¶¶ 54-55 (reaffirming its holding in Krohe while addressing section
10(b)’s requirement that the injury occurred in response to what was reasonably believed to be
an emergency). Indeed, the court in Nowak equated the determination of a catastrophic injury
with the determination of eligibility for a line-of-duty disability pension. Nowak, 2011 IL
111838, ¶ 29 (“[A]n employer’s obligation to pay the entire health insurance premium for an
injured officer and his family attaches on the date that it is determined that the officer’s injury is
‘catastrophic’—that is, on the date it is determined that the injured officer is permanently
disabled and therefore eligible for a line-of-duty disability pension.”).
¶ 26 Krohe, Richter, and Nowak control the instant appeal. Although these cases did not
address a municipality’s right to conduct discovery or present evidence on the issue of whether
the claimant’s injury was catastrophic, they unambiguously established that the award of a line-
of-duty disability pension means that the claimant suffered a catastrophic injury within the
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2014 IL App (2d) 130823
meaning of section 10(a) of the Act. Accordingly, where it is uncontroverted that a line-of-duty
disability pension has been awarded, section 10(a) is satisfied, and there is no need to engage in
discovery or present evidence regarding the claimant’s injury.
¶ 27 We emphasize that Krohe and its progeny are not rooted in the doctrine of collateral
estoppel. See Richter, 2011 IL App (2d) 100114, ¶ 16 (explaining the holding of Krohe, we said
that “[t]his is not an application of collateral estoppel”). Although the parties here argued
collateral estoppel in the trial court, Heelan now concedes that the doctrine does not apply. Nor
did the trial court base its decision on collateral estoppel. Since August 24, 2012, when the trial
court granted Heelan’s motion to strike the depositions, the court appropriately relied on the
holding from Krohe—that the term “catastrophic injury” is a term of art meaning an injury
resulting in the award of a line-of-duty disability pension.
¶ 28 The Village nonetheless maintains that it was entitled to litigate the nature, extent, and
causes of Heelan’s injuries, insisting that Heelan’s preexisting osteoarthritis was not work
related. Within its argument that collateral estoppel does not apply, the Village asserts that “the
pension board hearing did not follow the rules of evidence” and that “the facts of this case
require further medical testimony.” By criticizing the Board proceeding and seeking to introduce
evidence regarding Heelan’s injuries, the Village is in essence arguing that the Board’s decision
that Heelan qualified for a line-of-duty disability pension was erroneous. Despite the collateral-
estoppel label that the Village attaches to its argument, we discern a collateral attack on the
Board’s decision.
¶ 29 “A collateral attack on a judgment is an attempt to impeach that judgment in an action
other than that in which it was rendered.” (Internal quotation marks omitted.) Apollo Real
Estate Investment Fund, IV, L.P. v. Gelber, 403 Ill. App. 3d 179, 188 (2010). Describing the
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well-established collateral-attack doctrine, our supreme court explained that, once a court of
competent jurisdiction renders a judgment, it is not open to contradiction or impeachment in any
collateral proceeding. Malone v. Cosentino, 99 Ill. 2d 29, 32 (1983). “Once a court with proper
jurisdiction has entered a final judgment, that judgment can only be attacked on direct appeal, or
in one of the traditional collateral proceedings now defined by statute.” Malone, 99 Ill. 2d at 32-
33 (noting that the statutory collateral proceedings were habeas corpus proceedings,
postconviction proceedings, and section 2-1401 proceedings under the Code of Civil Procedure).
The collateral-attack doctrine applies to administrative agency decisions as well as to trial court
judgments. Board of Education of the City of Chicago v. Board of Trustees of the Public Schools
Teachers’ Pension & Retirement Fund of Chicago, 395 Ill. App. 3d 735, 740 (2009) (“[A]n
agency decision which is merely voidable, as opposed to void, is not subject to collateral
attack.”).
¶ 30 Here, because the Village does not challenge the Board’s statutory authority to render its
decision,3 any attempt to dispute the sufficiency of the Board’s proceeding, its factual findings,
or its ultimate award of Heelan’s pension would be an impermissible collateral attack on the
board’s decision. See Wabash County v. Illinois Municipal Retirement Fund, 408 Ill. App. 3d
924, 930 (2011) (“An agency decision that is erroneous and voidable is not subject to a collateral
attack, whereas an agency’s decision made without statutory authority is void and subject to a
collateral attack.” (citing Board of Education of the City of Chicago, 395 Ill. App. 3d at 740));
3
An administrative agency decision rendered without statutory authority is analogous to
a trial court order entered without subject matter jurisdiction. Board of Education of the City of
Chicago, 395 Ill. App. 3d at 740. Such a decision would be void and subject to collateral attack
in any court, at any time. Wabash County, 408 Ill. App. 3d at 930.
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Apollo Real Estate Investment Fund, 403 Ill. App. 3d at 188-89 (recognizing the defendants’
purported attempt to defend against collateral estoppel as a collateral attack on the foreign
judgment at issue, the court held that, because the defendants did not question the foreign court’s
jurisdiction, they were precluded from collaterally attacking the foreign judgment).
¶ 31 Nevertheless, the Village urges that its due process rights were violated when the trial
court prohibited it from conducting discovery and presenting evidence on the nature, extent, and
causes of Heelan’s injuries. The Village argues that, because it was neither a party nor in privity
with a party in the Board proceeding, it was denied the “opportunity to litigate anything.” In
support of its position, the Village cites authority cautioning against “the indiscriminate
application of offensive collateral estoppel” (Herzog v. Lexington Township, 167 Ill. 2d 288, 295
(1995)).
¶ 32 The “[r]equirements of due process are met by conducting an orderly proceeding in
which a party receives adequate notice and an opportunity to be heard.” Reichert v. Court of
Claims of State of Illinois, 203 Ill. 2d 257, 261 (2003). We review the Village’s due process
argument de novo. People v. K.S., 387 Ill. App. 3d 570, 573 (2008) (explaining that, while a trial
court’s decision to limit discovery is generally reviewed for an abuse of discretion, an alleged
denial of due process is reviewed de novo).
¶ 33 We reiterate: neither the trial court’s judgment nor our decision affirming it is based on
collateral estoppel. Given that our supreme court construed the phrase “catastrophic injury” as
an injury resulting in a line-of-duty disability pension,4 the Village’s due process argument is
4
In its attempt to distinguish Krohe, the Village cites the appellate court decision in
Krohe (Krohe v. City of Bloomington, 329 Ill. App. 3d 1133, 1143 (2002) (Steigmann, J.,
dissenting)), without mentioning that it is citing the dissent, for the proposition that the trial court
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unavailing. As explained above, where, as here, it is undisputed that an officer was awarded a
line-of-duty disability pension, section 10(a) is satisfied. Richter, 2011 IL App (2d) 100114,
¶ 16 (holding that the pension board’s decision awarding a line-of-duty disability pension
established that the firefighter suffered a catastrophic injury under section 10(a)). Therefore, the
factual issues raised by the Village—the nature, extent, and causes of Heelan’s injuries, as well
as any preexisting osteoarthritis—were not relevant. Nothing remained to be litigated under
section 10(a).
¶ 34 The Village also urges us not to follow Krohe, arguing that the “supreme court
misinterpreted the legislative intent behind” the Act. The Village further maintains that the court
in Krohe failed to appreciate the significance of the Act’s language requiring “a catastrophic
injury” by not considering whether the injury must result from a single occurrence. Regardless
of any error or deficiency the Village perceives in Krohe’s reasoning, we are bound by decisions
of our supreme court. See Pyle, 2012 IL App (5th) 110472, ¶¶ 19-20 (rejecting the
municipality’s arguments that Krohe’s definition of “catastrophic injury” did not comport with
the commonly understood meaning, that Krohe’s reliance on legislative hearings was improper,
and that Krohe was bad law for public policy reasons).
¶ 35 B. Heelan’s Cross-Appeal
in Krohe did not consider the nature and extent of the plaintiff-firefighter’s injury. But that is the
point—the supreme court held in Krohe that section 10(a)’s “catastrophic injury” requirement is
satisfied if a claimant was awarded a line-of-duty disability pension. Thus, the nature and extent
of a claimant’s injuries are not relevant to a trial court’s determination of whether section 10(a) is
satisfied in a declaratory judgment action.
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¶ 36 Heelan contends that the trial court abused its discretion in denying his motion for Rule
137 sanctions. In relevant part, Rule 137 provides that an attorney filing a pleading or a motion
must certify that, to the best of his or her knowledge, information, and belief, formed after
reasonable inquiry, the pleading or motion “is well grounded in fact and is warranted by existing
law or a good-faith argument for the extension, modification, or reversal of existing law, and that
it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or
needless increase in the cost of litigation.” Ill. S. Ct. R. 137 (eff. July 1, 2013). “The purpose of
the rule is to penalize attorneys and parties who abuse the judicial process by filing frivolous or
false matters without a basis in law or fact or for purposes of harassment.” In re Marriage of
Petrik, 2012 IL App (2d) 110495, ¶ 33. “A trial court’s decision whether to impose sanctions is
entitled to significant deference, and we will not disturb the trial court’s decision absent an abuse
of discretion.” Petrik, 2012 IL App (2d) 110495, ¶ 33. “A trial court abuses its discretion where
no reasonable person would take the view adopted by the trial court.” (Internal quotation marks
omitted.) Petrik, 2012 IL App (2d) 110495, ¶ 19.
¶ 37 Specifically, Heelan maintains that the Village’s complaint, its response to Heelan’s
motion to strike the depositions, and its motion to reconsider the order striking the depositions
were not warranted by a good-faith argument to extend, modify, or reverse existing law, but were
instead brought to harass him and needlessly increase litigation costs. Heelan emphasizes that
the Village acknowledged Krohe in its complaint. He also notes that he repeatedly brought
Gaffney, Nowak, and Richter to the Village’s attention during the pendency of the proceedings.
As evidence of the Village’s “candid display of *** disregard” for precedent, Heelan quotes the
Village’s attorney, from a December 2012 motion hearing: “We don’t agree with the Krohe
decision, the rationale or its applicability to the present situation.” Heelan additionally urges
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that, given the trial court’s and this court’s lack of authority to overturn the supreme court’s
decision in Krohe, the Village could not have been acting in good faith to seek modification or
reversal of the law.
¶ 38 The trial court found no evidence of bad faith by the Village and observed that the
Village had made it clear from the beginning that it was seeking to change the law. Despite
Heelan’s argument to the contrary, the Village’s acknowledgment of Krohe throughout this
litigation supports the court’s finding. The quote above was excerpted from the following
statement by the Village’s attorney: “I mean, it’s not a surprise. We don’t agree with the Krohe
decision, the rationale or its applicability to the present situation. We made that point; you made
your ruling. We respect that, we understand it. But the only way you get those rulings changed
is by challenging them in an appropriate forum. We’ve come here to do that.” The court
responded to counsel by stating, “I guess they have the right to do that.” Heelan’s attorney said,
“Certainly, they do, Your Honor. I would concede that.” That the court could not have
overruled Krohe does not change the fact that it might have found that Krohe was distinguishable
or inapposite to the due process and collateral estoppel issues raised by the Village.
Furthermore, the Village had no option but to bring its claim in the trial court and, if
unsuccessful, proceed up the chain of review—which is exactly what it is doing.
¶ 39 The record reveals that the Village attempted in good faith to distinguish Krohe and to
articulate its disagreement with Krohe’s holding. Additionally, the Illinois Municipal League
filed an amicus brief in support of the Village’s position, on public policy grounds. We cannot
say that no reasonable person would take the view adopted by the trial court, namely, that the
Village brought its action in an effort to change existing law and did not act in bad faith.
Accordingly, the trial court did not abuse its discretion in denying Heelan’s motion for Rule 137
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sanctions. See McClaughry v. Village of Antioch, 296 Ill. App. 3d 636, 645 (1998) (“A court
should not impose [Rule 137] sanctions on a party who presents objectively reasonable
arguments for his position, regardless of whether the arguments are deemed to be unpersuasive
or incorrect.”).
¶ 40 III. CONCLUSION
¶ 41 For the foregoing reasons, we affirm the judgment of the circuit court of Lake County.
¶ 42 Affirmed.
¶ 43 JUSTICE McLAREN, dissenting.
¶ 44 The “sole issue” in Krohe was whether the phrase “ ‘catastrophic injury’ ” is
“synonymous with an injury resulting in a line-of-duty disability.” Krohe, 204 Ill. 2d at 394.
The supreme court decided that it is. But that is all that the supreme court decided in Krohe. It
did not, as the majority claims, hold “that section 10(a)’s ‘catastrophic injury’ requirement is
satisfied if a claimant was awarded a line-of-duty disability pension.” Supra ¶ 33 n.4. Further,
nowhere did Krohe hold, as the majority does now, that a pension board’s award of a line-of-
duty disability pension is irrefutable proof of a catastrophic injury under section 10(a) of the Act
in a declaratory judgment proceeding in a trial court.
¶ 45 Yet that is the meaning and effect that the majority here ascribes to Krohe. It takes the
answer to that “sole issue” of the meaning of an ambiguous phrase and transforms it into a rule
of law affecting civil procedure, evidence, burdens of proof, and due process.
¶ 46 The majority finds that Krohe, Richter, and Nowak control this case. Supra ¶ 26. Indeed,
the first misstep onto this path of misapplying Krohe occurred in Richter, where this court stated
that, “[u]nder Krohe, the pension board’s decision established that the plaintiff suffered a
catastrophic injury, thus meeting the requirements of section 10(a) of PSEBA.” Richter, 2011 IL
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App (2d) 100114, ¶ 16. The second misstep is the majority here referring to Nowak as
controlling. The parties in Nowak agreed “that plaintiff suffered a catastrophic injury in the line
of duty” and “that, in light of that injury, the City is obligated under section 10(a) to pay the
entire health insurance premium for plaintiff and his family.” Nowak, 2011 IL 111838, ¶ 9. The
“sole point of contention” of the case was when the city’s obligation under section 10 attached.
Id. Nowak is of no real guidance, let alone controlling.
¶ 47 The majority now holds, in essence, that a pension board is the de facto finder of fact as
to section 10(a) of the Act. Although the majority states that, because “it is undisputed that the
Board awarded Heelan a line-of-duty disability pension[] *** it is an uncontroverted fact that he
was catastrophically injured for purposes of section 10(a)” (supra ¶ 20), the true meaning of the
majority holding is that it is an incontrovertible fact. So long as a pension board has issued an
order granting a line-of-duty disability pension, a trial court, in a different proceeding with
different parties, has no authority to hear any evidence as it applies to determining a
“catastrophic injury” under section 10(a). The majority holds that the trial court, in an
independent proceeding, must take judicial notice of the pension board’s finding and consider it
as irrefutable proof.
¶ 48 Due process “entitles a litigant to have all the evidence submitted to a single judge who
can see the witnesses testify and, thus weigh their testimony and judge their credibility.” Smith
v. Freeman, 232 Ill. 2d 218, 223 (2009).5 Findings of fact based on the demeanor of witnesses
should be made by the judge who observed the witnesses. Anderson v. Kohler, 376 Ill. App. 3d
714, 720 (2007).
5
Smith involved the issue of whether parties could agree or stipulate to allow a successor
judge to decide a case based on written evidence received by a predecessor judge.
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¶ 49 A litigant in a trial court is entitled to have the merits of his case decided by the trial
court. Due process is not served when findings of fact and conclusions of law of a different
tribunal, with no subject matter jurisdiction over the issue raised, in a different case in which the
litigant was not a party and in which the litigant had no right to intervene, are binding on the trial
court such that the litigant cannot contest the cause of action, demand strict proof thereof, obtain
discovery, present evidence, have the trial court determine the credibility of the witnesses and the
weight to be accorded to their testimony, and generally defend against judgment being entered
against it.
¶ 50 Our supreme court long ago stated:
“In Atchinson, Topeka & Santa Fe Railway Com. v. Commerce Commission, supra, we
held that the statement of one tribunal of a particular fact in a case before it is no
evidence in another controversy upon a different issue between different parties in
another tribunal of the particular fact stated, and that the commissioners cannot act on
their own information but must base their findings on evidence presented in the case.”
Moline Consumers’ Co. v. Illinois Commerce Comm’n ex rel. Chicago, B. & Q. R.R. Co.,
353 Ill. 119, 129 (1933).
The majority does not explain why the findings of an administrative agency can (or should) be
binding on a trial court in a separate proceeding with different parties regarding matters that the
administrative agency has no statutory authority to decide. Administrative agencies are limited
to the powers granted to them by the legislature. See Gaffney v. Board of Trustees of the Orland
Fire Protection District, 2012 IL 110012, ¶ 38 (“An administrative agency has no general or
common law powers. Alvarado v. Industrial Comm’n, 216 Ill. 2d 547, 553 (2005). Rather, an
agency’s powers are limited to those granted by the legislature and any action must be
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specifically authorized by statute. Alvarado, 216 Ill. 2d at 553.”). To my knowledge, there is no
authority, statutory or otherwise, that grants power to a pension board to bind a trial court. A
pension board’s decision to deny a disability pension to a claimant firefighter does not prevent a
board of commissioners from deciding that the same claimant should be discharged because of a
disability. See Dowrick v. Village of Downers Grove, 362 Ill. App. 3d 512, 521 (2005). I see no
reason why a pension board’s decision should have more power over a trial court than it does
over another administrative agency.
¶ 51 In cases of administrative review, an administrative agency’s decision is not beyond
review. Its findings and conclusions on questions of fact are deemed prima facie true and correct
but are still reviewed under the manifest-weight-of-the-evidence standard. Peacock v. Board of
Trustees of the Police Pension Fund, 395 Ill. App. 3d 644, 652 (2009). An agency’s
interpretation of a statute, regulation, or rule connected with the agency is considered relevant
but not binding (City of St. Charles v. Illinois Labor Relations Board, 395 Ill. App. 3d 507, 509
(2009)), and its decision on a question of law is not binding but reviewed de novo (Wolin v.
Department of Financial & Professional Regulation, 2012 IL App (1st) 112113, ¶ 19). Even an
agency’s credibility determinations are not beyond review; while such a determination is to be
“afforded considerable weight,” the deference afforded “ ‘is not boundless.’ ” Kouzoukas v.
Retirement Board of the Policemen’s Annuity & Benefit Fund of the City of Chicago, 234 Ill. 2d
446, 465 (2009) (quoting Wade v. City of North Chicago Police Pension Board, 226 Ill. 2d 485,
507 (2007)). I am aware of neither authority nor rationale for validating a pension board’s award
of a pension as irrefutable proof of an element of a cause of action in a trial court proceeding
involving a different party and different issues except when it was agreed to by the parties in the
trial court. See, e.g., Gaffney, 2012 IL 110012, ¶ 54 (both plaintiffs were awarded line-of-duty
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disability pensions, and “[t]he defendants agree that the requirements of subsection (a) have been
met in this case.”); Nowak, 2011 IL 111838, ¶ 9 (board awarded line-of-duty disability pension
and “[t]he parties here agree that plaintiff suffered a catastrophic injury in the line of duty”).
Springborn v. Village of Sugar Grove, 2013 IL App (2d) 120861, presented an interesting
situation: although the defendants therein did “not dispute in these appeals that Springborn and
Cecala suffered ‘catastrophic injuries’ ” (id. ¶ 25), there is no mention of whether either plaintiff
was awarded a line-of-duty disability pension.6
¶ 52 The majority’s due process analysis is wholly inadequate. The majority finds the
Village’s due process claim “unavailing” (supra ¶ 33) and states that due process requires only
“an orderly proceeding in which a party receives adequate notice and an opportunity to be heard”
(internal quotation marks omitted) (supra ¶ 32). However, the majority fails to identify any
proceeding at which the Village had notice and an opportunity to be heard regarding the
evidence of a catastrophic injury. It is this evidence upon which the Village’s liability for the
insurance premiums is based. The majority’s statement might make sense if the Village were
attempting to abrogate the pension. However, that is not the case. The Village is seeking to
avoid liability for the health insurance premiums; it is not attempting to affect the Board’s
decision.
¶ 53 The Village was not a party before the Board and had no right to be a party. A
municipality currently does not have a right to intervene in such a case, although a pension board
6
At least we are told that plaintiff Springborn applied for a pension, as “his testimony
from two appearances before the Board of Trustees for the Police Pension Fund of Sugar Grove”
was attached to the parties’ cross-motions for summary judgment. Id. ¶ 7. No mention is made
of any pension application by plaintiff Cecala.
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has the discretion to permit such an intervention. See Williams v. Board of Trustees of the
Morton Grove Firefighters’ Pension Fund, 398 Ill. App. 3d 680, 688-89 (2010). However, a
board’s decision to deny a municipality’s request to participate in a pension hearing has been
found not to be an abuse of discretion. See Village of Stickney v. Board of Trustees of the Police
Pension Fund of the Village of Stickney, 347 Ill. App. 3d 845, 852 (2004). Unless the majority’s
opinion is overturned, it would behoove municipalities to seek to intervene in pension cases as a
matter of right in order to protect their financial interests, since a pension board’s grant of a line-
of-duty disability pension is now deemed to be irrefutable proof in any other tribunal. However,
any future attempt at intervention could create numerous problems dealing with the due process
rights of all concerned participants.7 Even when a municipality intervenes in a proceeding,
unless all evidence is presented to and issues are disposed of by the same trier of fact, the
proceeding does not comport with due process.
¶ 54 I also question the majority’s discernment of a collateral attack on the Board’s decision
granting the pension. See supra ¶ 28. A collateral attack “is an attempt to impeach or deny
effect to an order in some proceeding not provided by law for the express purpose of attacking
it.” Thomas v. Sklodowski, 303 Ill. App. 3d 1028, 1033 (1999) (citing 46 Am. Jur. 2d Judgments
§ 519 (1994)). The Village’s complaint for declaratory judgment did not seek to impeach or
deny effect to the Board’s decision; had the Village succeeded on its complaint, the decision
granting the line-of-duty disability pension would have remained intact. The only relief sought
was a declaration that the Village did not have to pay the health insurance premiums—an issue
7
See Williams, 398 Ill. App. 3d at 690, wherein the municipality was allowed to
intervene, but aspects of its intervention were deemed to raise a conflict of interest resulting in a
violation of due process.
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that the Board clearly had no statutory authority to decide, raised by a party over which the
Board had no personal jurisdiction.
¶ 55 In addition, since the Village never participated in the Board proceeding, it is difficult to
understand how the Village’s action is collateral. In attempting to define a collateral attack, the
majority quotes from Apollo Real Estate Investment Fund (see supra ¶ 29) but somehow misses
this part of the explanation:
“Under the collateral attack doctrine, a final judgment rendered by a court of
competent jurisdiction may only be challenged through direct appeal or procedure
allowed by statute and remains binding on the parties until it is reversed through such a
proceeding.” (Emphasis added.) Apollo Real Estate Investment Fund, 403 Ill. App. 3d at
189.
The majority is correct in stating that collateral estoppel provides no basis for its decision. Supra
¶ 33. “Collateral estoppel is applicable only where the issue decided in the prior adjudication is
identical with the one presented in the suit in question, there was a final judgment on the merits
in the prior adjudication, and the party against whom estoppel is asserted was a party or in privity
with a party to the prior adjudication.” Pedersen v. Village of Hoffman Estates, 2014 IL App
(1st) 123402, ¶ 42. It is axiomatic that someone not a party or in privity with a party in a
proceeding is not bound by the judgment in that proceeding, as was determined to be the case on
similar facts in Pedersen. See id. ¶¶ 45-47. However, the majority then fails to explain how a
final judgment of the Board can be binding on the Village, a nonparty to the proceeding before
the Board that is not challenging the Board’s judgment. Without some form of privity, personal
jurisdiction, or prior involvement, it would appear that the Village’s declaratory judgment action
is a case of first impression as to the rights, duties, and liabilities at issue between the Village and
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Heelan. See Lewis v. Blumenthal, 395 Ill. 588, 594 (1947) (res judicata and collateral attack
would apply only in a case where the trial court had subject matter and personal jurisdiction over
the parties and their privies).
¶ 56 The majority seems unwilling to countenance the possibility of “inconsistent verdicts.”
But that sometimes happens when different tribunals, considering (possibly) different evidence
presented by different parties, make decisions regarding different causes of action. See, e.g.,
Dowrick, 362 Ill. App. 3d at 521; Edwards v. Addison Fire Protection District Firefighters’
Pension Fund, 2013 IL App (2d) 121262, ¶ 38 (citing Dowrick and finding that it was not
“incongruous” that the claimant “could be found unfit for duty because of a latex sensitivity yet
be found ineligible for a pension based on the same physical infirmity”). Certainly, the
legislature must have been aware of such a potentiality when it assigned to pension boards the
power to grant line-of-duty disability pensions but declined to assign to the boards the power to
order the payment of health insurance premiums under section 10 of the Act.
¶ 57 The majority’s position also leads to implications that the majority fails to acknowledge.
If “the award of a line-of-duty disability pension means that the claimant suffered a catastrophic
injury within the meaning of section 10(a) of the Act” (supra ¶ 26), the converse must also be
true: if the pension board denies an application for a line-of-duty disability pension, that denial
means that the claimant did not suffer a catastrophic injury within the meaning of section 10(a)
of the Act. Such a claimant would be precluded from presenting any evidence in the trial court
in an attempt to seek the payment of health insurance premiums under the Act, based upon a
catastrophic injury (which has not been adjudicated in any prior proceeding, especially one in
which the municipality was a party). Such an attempt might even be deemed frivolous,
considering the telling effect that the majority ascribes to pension board decisions regarding line-
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of-duty disability pensions. Simply put, neither party should be precluded from contesting a
declaratory judgment claim, because the claim is the first instance of litigation between the
parties as to the issue.
¶ 58 The determination of whether an issue has been raised and considered in a prior
proceeding has been described as follows:
“ ‘In determining whether an issue has been raised and considered in a
prior proceeding reference may be had to “pleadings, testimony, jury instructions,
findings, verdicts, and any other pertinent sources of information sensibly helpful
to the inquiry.” “Res Judicata Reexamined,” Cleary, 57 Yale Law Journal, 339,
342. Harmon v. Auditor of Public Accounts, 123 Ill. 222.’
This determination does not depend upon technicalities but on broad principles of
justice, and it can apply only when the party has had his day in Court and full opportunity
to establish his claim. Voorhees v. Chicago & A. R. Co., 208 Ill. App. 86, 95 (3rd
Dist. 1917). The doctrine is based upon the principle that while every man is entitled to
his day in court and full opportunity to sustain his position on the issues of fact involved,
he is not given the right to litigate a matter twice. ‘It is of first importance both in the
observance of private rights and the public good that a question once adjudicated by a
court of competent jurisdiction shall be considered as finally settled and conclusive on
the parties, subject only to proceedings in a court of review.’ Winkelman v. Winkelman,
310 Ill. 568, 573, 142 N.E. 173 (1924).” Chas. Ind Co. v. Cecil B. Wood, Inc., 56 Ill.
App. 2d 30, 38 (1965).
There is nothing in this record to suggest that the Village ever had a prior opportunity to have its
day in court. Until it does, I will continue to dissent.
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