Village of Vernon Hills v. Heelan

Illinois Official Reports
Appellate Court
Village of Vernon Hills v. Heelan, 2014 IL App (2d) 130823Appellate Court THE VILLAGE OF VERNON HILLS, Plaintiff and Counter-
Caption defendant-Appellant and Cross-Appellee, v. WILLIAM J. HEELAN,
Defendant and Counterplaintiff-Appellee and Cross- Appellant.
District & No. Second District
Docket No. 2-13-0823
Filed July 23, 2014
Held When the board of trustees of plaintiff village’s police pension fund
(Note: This syllabus awarded defendant a line-of-duty disability pension for the hip injury
constitutes no part of the he suffered while responding to a “panic call alarm,” the award
opinion of the court but established that defendant suffered a “catastrophic injury” that entitled
has been prepared by the defendant to the payment of health insurance premiums for himself,
Reporter of Decisions his wife, and his children pursuant to section 10(a) of the Public Safety
for the convenience of Employee Benefits Act, since the Illinois Supreme Court held in
the reader.) Krohe that the legislature intended the term “catastrophic injury” to be
synonymous with an injury resulting in the award of a line-of-duty
disability pension under the Pension Code; therefore, the trial court’s
entry of a declaratory judgment for defendant finding that plaintiff
village was obligated to pay the health insurance premiums for
defendant and his family was affirmed, and the denial of defendant’s
motion for sanctions under Supreme Court Rule 137 was also upheld
in the absence of any bad faith in the village’s challenge of the Krohe
decision.
Decision Under Appeal from the Circuit Court of Lake County, No. 11-MR-1683; the
Review Hon. Margaret J. Mullen, Judge, presiding.
Judgment Affirmed.
Counsel on Keith L. Hunt and Bradley E. Faber, both of Hunt & Associates, P.C.,
Appeal of Chicago, for appellant.
Charles W. Smith, of Smith, LaLuzerne & Hartman, Ltd., of
Waukegan, for appellee.
Brian D. Day and Roger Huebner, both of Illinois Municipal League,
of Springfield, amicus curiae.
Panel 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 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.
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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¶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
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 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
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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
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
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.
2
The case continued on matters not at issue in this appeal.
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¶ 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, 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 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]
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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
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.
¶ 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
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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
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
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
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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)); 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,
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
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,
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.
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 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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¶ 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
¶ 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
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
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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 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 establishes that the plaintiff suffered a
catastrophic injury, thus meeting the requirements of section 10(a) of [the Act].” Richter, 2011
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IL 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).
¶ 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 and Santa Fe Railway Co. v. Commerce Com., 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, Burlington & Quincy
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
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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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 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, 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
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
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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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 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 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
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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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 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-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. Harman 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
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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 NE 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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