Dancor Construction, Inc. v. FXR Construction, Inc.

2016 IL App (2d) 150839
No. 2-15-0839
Opinion filed September 29, 2016
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
SECOND DISTRICT
______________________________________________________________________________
DANCOR CONSTRUCTION, INC., ) Appeal from the Circuit Court
) of Kane County.
Plaintiff and Counterdefendant- )
Appellant and Cross-Appellee, )
)
v. ) No. 12-L-487
)
FXR CONSTRUCTION, INC., )
and DENNIS E. VITA, )
)
Defendants-Appellees and )
Cross-Appellants ) Honorable
) James R. Murphy,
(FXR Construction, Inc., Counterplaintiff). ) Judge, Presiding
______________________________________________________________________________
JUSTICE SPENCE delivered the judgment of the court, with opinion.
Presiding Justice Schostok and Justice McLaren concurred in the judgment and opinion.
OPINION
¶1 Plaintiff, Dancor Construction, Inc. (Dancor), brought suit against defendants, FXR
Construction, Inc. (FXR), and its owner, Dennis E. Vita, in Kane County pursuant to the forum-
selection clause in the parties’ contract. Dancor brought breach-of-contract and tort claims
against defendants, related to a construction project in New York. Meanwhile, in a New York
court, FXR filed a mechanic’s lien on the property and brought suit for breach of contract and
unjust enrichment against Dancor, among others. The New York case was later dismissed.
2016 IL App (2d) 150839
¶2 Defendants moved to dismiss or transfer the Kane County case, arguing in part that New
York was the better forum for the dispute. The circuit court denied defendants’ motion, finding
that the forum-selection clause designating Kane County was valid and enforceable.
¶3 Dancor filed amended and second amended complaints. Defendants moved to dismiss
each, and the circuit court granted their motions in part, dismissing Dancor’s tort counts for
injurious falsehood and slander of title related to the construction project.
¶4 FXR then moved to dismiss or transfer the case or to reconsider the circuit court’s prior
order denying the motion to dismiss or transfer the case. FXR argued that New York law
rendered the forum-selection clause void and unenforceable and that New York was the only
proper forum. The circuit court agreed and dismissed the case to allow the action to be refiled in
New York. This appeal followed. We affirm.
¶5 I. BACKGROUND
¶6 Dancor filed its complaint in Kane County on September 10, 2012. The complaint
alleged as follows. Dancor was the general contractor for the construction of an AutoZone store
(the Project) in Bronx County, New York, and it employed FXR as a subcontractor on the
Project. The subcontract was for $169,826.61. Dancor removed FXR from the Project and
brought in a replacement subcontractor to complete construction. After paying FXR, FXR’s
replacement, and other subcontractors, Dancor had spent a total of $176,481.88, or about $6600
more than the agreed-upon contract price. FXR recorded a mechanic’s lien against the Project
property on August 29, 2012, seeking $104,544.11.
¶7 Dancor attached the parties’ contract to the complaint. Section XXIX of the contract,
titled “Venue and Choice of Law” (the forum-selection clause), provided that the parties agreed
that the contract was executed in Kane County and that it would be governed by Illinois law.
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Further, it stated that “[a]ny claims, lawsuits, disputes or claims arising out of or relating to this
agreement shall be litigated in Kane County, Illinois.”
¶8 Dancor’s three-count complaint alleged breach of contract (count I) and two torts,
injurious falsehood (count II) and interference with prospective business advantage (count III).
In count I, Dancor alleged that FXR failed to meet reasonable deadlines, provide sufficient
manpower, and timely complete tasks on the Project. Consequently, Dancor removed FXR and
hired another firm to complete the Project. In count II, Dancor alleged that defendants recorded
a lien against the Project site for unpaid work completed. Dancor alleged that the lien’s
statement regarding the amount unpaid ($104,544.11) was not true, that defendants made the
statement knowing that it was false, and that they made the statement with the intent that others
rely on it. Dancor further alleged that a reasonable person or company would be “highly
offended” by an accusation that it failed to pay in excess of $100,000, and that defendants
intended the publication of the lien to result in pecuniary harm to Dancor.
¶9 Shortly after Dancor filed its complaint, FXR filed its complaint in New York on October
24, 2012, against, inter alios, Dancor, to foreclose its mechanic’s lien (the New York action).
FXR alleged that, as a subcontractor, it had agreed to provide certain services for Dancor on the
Project. FXR continued that it completed its performance of the contract and was owed a total of
$171,926.61. It had received $67,382.50 and alleged that Dancor still owed $104,544.11.
Dancor breached their contract and was unjustly enriched in the amount of $104,544.11 by not
paying FXR the full amount owed.
¶ 10 Back in the Kane County litigation, on December 26, 2012, defendants filed a motion to
dismiss Dancor’s complaint or transfer the case. In their motion, defendants alleged that New
York law required that the action be brought in a New York court. Defendants further argued
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that the defendants in the New York action, aside from Dancor, did not have minimum contacts
with Illinois sufficient to bring the case here. Finally, defendants argued that Bronx County in
New York was the best forum to resolve the legal issues related to the Project and, under the
doctrine of forum non conveniens, they sought that the case be transferred to New York.
¶ 11 Dancor responded by citing the forum-selection clause that designated Kane County.
Dancor argued that both New York and Illinois public policy favor enforcement of forum-
selection clauses in contracts and that the forum-selection clause here was reasonable and should
be enforced.
¶ 12 The circuit court held a hearing on the motion to dismiss or transfer. Thereafter, on
February 20, 2013, it denied the motion, finding that the forum-selection clause in the parties’
contract was valid and that venue in Kane County was appropriate.
¶ 13 On April 26, 2013, defendants moved to dismiss counts II and III of the complaint. They
argued that count II was based on insufficient conclusions by Dancor, not well-pled facts. They
argued that count III, which was based on the allegations of count II, was likewise defective. On
June 6, 2013, the circuit court granted defendants’ motion to dismiss counts II and III and
granted Dancor leave to amend its complaint.
¶ 14 Dancor filed an amended complaint on June 18, 2013. The amended complaint again
contained three counts: count I for breach of contract; count II for injurious falsehood; and count
III for interference with prospective business advantage. Under count III, Dancor alleged that
defendants claimed they were owed $104,544.11, that they knew they were not actually owed
that amount, and that they declared they were owed that amount with intent that Dancor incur
pecuniary harm.
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¶ 15 Around this time, the New York court heard a motion to dismiss FXR’s complaint in the
New York action. On July 18, 2013, it entered an order dismissing the complaint, explaining as
follows:
“Here, the Plaintiff contracted the venue for lawsuits and failed to meet its burden in
establishing it was unreasonable, unjust, in contravention of public policy, invalid due to
fraud or overreaching, or it is shown that a trial in the selected forum would be so gravely
difficult that the challenging party would, for all practical purposes, be deprived of its day
in court.”
The New York court continued that an action to determine the obligations under the mechanic’s
lien and to determine the appropriateness of the forum-selection clause in the parties’ contract
had been commenced in Kane County before the New York action was filed.
¶ 16 Back in Kane County, defendants moved to dismiss Dancor’s amended complaint. On
September 5, 2013, the circuit court dismissed count I as to Vita; dismissed count II without
prejudice; informed Dancor that, if it repled count II, it should replead it as a “slander of title”
claim; and dismissed count III with prejudice.
¶ 17 Dancor filed a second amended complaint on November 13, 2013. The second amended
complaint contained six counts. Counts I and II were for breach of contract against FXR and
Vita, respectively; counts III and IV were for slander of title against FXR and Vita, respectively;
and counts V and VI were related to mechanic’s-lien liability under New York law against FXR
and Vita, respectively. In counts III and IV, Dancor alleged that FXR did not complete its
contractual duties and that Dancor had to bring in a replacement subcontractor to complete the
Project, costing Dancor $95,106. Regarding defendants’ mechanic’s lien against the Project
property for money they claimed they were owed under the contract, Dancor alleged that the
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statement of the amount owed was false. Dancor alleged that defendants knew or should have
known that it was false, because they knew or should have known that they did not complete
their work on the Project. Yet, Dancor alleged, defendants published the mechanic’s lien when
they knew or should have known that the lien would result in pecuniary damage to Dancor. The
mechanic’s lien clouded the title to $115,000 of Dancor’s funds.
¶ 18 On December 20, 2013, defendants moved to strike and dismiss the second amended
complaint. In part, the motion argued that counts III and IV failed to state a claim for slander of
title, because the counts failed to allege facts showing that the lien was false or malicious, that
Dancor incurred special damages, or that the lien made any statements about real property owned
by Dancor. Rather, defendants argued, Dancor again relied on insufficient conclusions, not well-
pled facts.
¶ 19 On February 14, 2014, the circuit court ruled on defendants’ motion to strike and dismiss
the second amended complaint. It denied the motion as to count I (breach of contract against
FXR). It granted the motion with prejudice as to counts II through VI, and, pursuant to Illinois
Supreme Court Rule 304(a) (eff. Feb. 26, 2010), found no reason to delay enforcement or appeal
of its order.
¶ 20 On March 13, 2014, Dancor moved to (1) vacate the Rule 304(a) language in the
February 14, 2014, order; and (2) grant Dancor leave to file an amended complaint to incorporate
its previously dismissed injurious-falsehood count, which it had not included in the second
amended complaint. On the same day, the court entered an order vacating the Rule 304(a)
language. On March 26, after argument on the issue, the court denied leave to reassert the
injurious-falsehood count.
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¶ 21 FXR answered count I of the second amended complaint on April 25, 2014. Along with
its answer, FXR filed a counterclaim, alleging that Dancor was unjustly enriched and breached
their contract. The case proceeded to discovery, and a bench trial was eventually scheduled for
August 26 and 27, 2015.
¶ 22 On May 15, 2015, FXR moved to dismiss or transfer the case pursuant to sections 2-
619(a)(1) and (a)(9) of the Code of Civil Procedure (735 ILCS 5/2-619(a)(1), (a)(9) (West
2014)). FXR argued that New York law rendered the forum-selection clause void and
unenforceable. It also pointed out that Illinois law substantially mirrored New York law on the
enforcement of forum-selection clauses in construction contracts. Accordingly, FXR requested
that the circuit court transfer the case to New York or, in the alternative, dismiss the case without
prejudice.
¶ 23 Dancor responded to the motion to dismiss or transfer by arguing, in part, that the
enforceability of the forum-selection clause had already been decided in 2013, when the New
York action was dismissed and the New York court held that the forum-selection clause was
valid and enforceable. Dancor therefore argued that FXR was collaterally estopped from
relitigating the issue of the forum-selection clause’s validity and enforceability.
¶ 24 Before the circuit court ruled on FXR’s motion to dismiss or transfer, FXR moved to
reconsider the circuit court’s February 20, 2013, order, which had denied defendants’ first
motion to dismiss or transfer. FXR argued that the court had erred in finding the forum-selection
clause valid and enforceable.
¶ 25 On July 20, 2015, the circuit court entered an order addressing both FXR’s motion to
dismiss or transfer and its motion to reconsider. The court found that, with respect to the original
motion to dismiss or transfer, it had not been advised by either party of section 757 of the New
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York General Business Law (N.Y. Gen. Bus. Law § 757 (McKinney 2012)), which declares void
and unenforceable any choice-of-law or forum-selection provision requiring application of
another state’s law to a New York construction contract. It rejected Dancor’s argument that the
New York court’s order collaterally estopped FXR’s challenge to the forum-selection clause,
stating that the order did not have a binding effect on this or any other action. Rather, it
reasoned, the New York court deferred to Illinois and was similarly uninformed of section 757.
The circuit court found that section 757 applied to the contract between Dancor and FXR and
that consequently the forum-selection clause was void and unenforceable. While it found that
the clause could be severed under the terms of the contract, it also found that the case would be
more appropriately and conveniently litigated in New York.
¶ 26 The circuit court acknowledged that trial was set to commence within the next 60 days 1
and that the circuit court’s local rules generally required dispositive motions to be filed no later
than 60 days before trial. Here, both parties incurred costs preparing for trial in Illinois and
therefore both sides would be prejudiced by further delay. Nevertheless, the court reasoned, its
prior order was in error because of a misapplication, or lack of citation, of applicable law, and
the order was interlocutory and could be corrected at any time before trial. Accordingly, the
court granted FXR’s motion to dismiss so that the case could be refiled in New York.
1
On June 18, 2015, the trial was rescheduled from August 26 and 27 to September 9 and
10, 2015. We note, however, that the local rule requires dispositive motions to be filed no later
than 120 days prior to trial, not 60. 16th Judicial Cir. Ct. R. 6.06(a) (May 5, 2008). Sixty days is
required for counterclaims, actions over, contribution claims, and third-party complaints. 16th
Judicial Cir. Ct. R. 6.06(b) (May 5, 2008).
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¶ 27 Dancor filed a timely notice of appeal on August 12, 2015, pursuant to Illinois Supreme
Court Rule 301 (eff. Feb. 1, 1994). Defendants timely cross-appealed.
¶ 28 II. ANALYSIS
¶ 29 A. Jurisdiction
¶ 30 Defendants assert that this court lacks jurisdiction to hear Dancor’s appeal. This court
has an obligation to consider its jurisdiction at any time, and, if jurisdiction is lacking, we must
dismiss the appeal. Anderson Dundee 53 L.L.C. v. Terzakis, 363 Ill. App. 3d 145, 152-53 (2005).
Our obligation to consider whether we possess jurisdiction would exist even if defendants had
not raised the issue. Little Texas, Inc. v. Buchen, 319 Ill. App. 3d 78, 81 (2001).
¶ 31 Dancor filed its notice of appeal pursuant to Rule 301, which allows appeals from final
orders. Likewise, its statement of jurisdiction on appeal invokes Rule 301. Defendants argue
that the circuit court’s July 20, 2015, order was not a final order because it dismissed the case
under forum non conveniens, with leave to refile the case in New York. Defendants therefore
contend that Dancor had to appeal pursuant to Illinois Supreme Court Rule 306(a)(2) (eff. July 1,
2014), which provides that a party may petition for leave to appeal from an order allowing or
denying a motion to dismiss on the grounds of forum non conveniens.
¶ 32 Contrary to defendants’ assertion, the circuit court did not dismiss the case pursuant to
the doctrine of forum non conveniens. Rather, the circuit court granted a section 2-619 motion to
dismiss based on an affirmative matter, that is, applicable law that rendered the forum-selection
clause void and unenforceable and required that the case be brought in New York. Whether to
dismiss based on a forum-selection clause—which requires consideration of contract
principles—is a separate issue from the noncontractual considerations of forum non conveniens,
and to permit an appeal under Rule 306(a)(2) on a forum-selection issue would impermissibly
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expand the scope of the rule by usurping the supreme court’s rulemaking authority. Ferguson v.
Bill Berger Associates, Inc., 302 Ill. App. 3d 61, 69 (1998). Rather, a dismissal pursuant to a
forum-selection clause is a final order for purposes of Rule 301. Fabian v. BGC Holdings, LP,
2014 IL App (1st) 141576, ¶¶ 12-13 (dismissal based on forum-selection clause, even without
prejudice to refiling in another state, was a final order because it terminated the plaintiff’s right
to bring those claims in Illinois). Accordingly, we have jurisdiction.
¶ 33 B. Dancor’s Arguments on Appeal
¶ 34 Dancor raises several issues on appeal. Those issues are: (1) whether the New York
court’s order precluded litigation of the forum-selection clause; (2) whether the circuit court
erred in dismissing the case under forum non conveniens; (3) whether the circuit court erred in
granting a dispositive motion less than 120 days before trial, in violation of the circuit court’s
local rules; and (4) whether the circuit court erred in dismissing Dancor’s tort claims for
injurious falsehood and slander of title.
¶ 35 Dancor’s first issue concerns the New York action. The New York court dismissed that
case on July 18, 2013, in an order granting the defendants’ (including Dancor’s) motion to
dismiss FXR’s complaint, on the basis of the forum-selection clause. In its order, the New York
court reasoned as follows. A contractual forum-selection clause is prima facie valid and
enforceable unless shown by the challenging party to be unreasonable, unjust, in contravention
of public policy, or invalid due to fraud or overreach, or unless the selected forum would
effectively deprive the challenging party of its day in court. The court cited section 41 of New
York’s Lien Law (N.Y. Lien Law § 41 (McKinney 2012)). FXR had contracted for venue to be
in Illinois, and it had not met its burden to show that the contract’s forum-selection clause was
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unreasonable, unjust, in contravention of public policy, or invalid due to fraud or overreach, or
that it would be effectively deprived of its day in court.
¶ 36 Dancor argues that the New York court’s order held that the forum-selection clause was
valid and enforceable. Dancor further argues that the New York court did not dismiss based on
the pendency of this case and could not defer to the circuit court, which had yet to issue a final
order on the issue of the forum-selection clause’s validity.
¶ 37 Dancor continues that the New York court’s order has preclusive effect under the
doctrine of collateral estoppel. According to Dancor, Illinois law requires only three elements
for the application of collateral estoppel: (1) identical issues; (2) a final judgment on the merits;
and (3) that the party against which estoppel is asserted was a party to the prior adjudication.
Dancor asserts that here the parties were the same, the New York order was a final order, and the
issue—that is, the validity and enforceability of the forum-selection clause—was the same.
Dancor concludes that the parties are therefore bound by the New York court’s holding on the
issue of the forum-selection clause’s validity and that FXR was collaterally estopped from
raising the issue again in the circuit court.
¶ 38 Dancor turns to its second argument, that the circuit court erred in dismissing this case
under the doctrine of forum non conveniens. Dancor argues as follows. FXR’s motion to
dismiss did not contain any analysis of the public- and private-interest factors that would favor
New York as the proper forum. Nor did the circuit court analyze these factors in its order
granting FXR’s motion. Because no factors supported a transfer to New York, the dismissal on
the basis of forum non conveniens was in error. Moreover, New York law holds that, where a
litigant has “bonded over” a lien on real property, the subject of the litigation is not the property
but rather the bond, to which the lien is now attached. See Shepherd Showcase, Inc. v. Pekala,
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138 A.D.2d 960, 960-61 (N.Y. App. Div. 1988). Under Pekala, then, the situs of the real
property in this case—New York—does not determine the proper forum.
¶ 39 With respect to the third argument, that the circuit court improperly granted a dispositive
motion less than 120 days before trial, Dancor argues as follows. Local Rule 6.06 requires that
any dispositive motion be brought no later than 120 days prior to trial. FXR violated this rule
when it filed its motion to dismiss or transfer on May 15, 2015, and trial was set to begin on
August 26, 2015. Local rules are meant to be followed and are not mere suggestions or
guidelines. Rather, they have the force of statutes and are binding on courts and parties.
¶ 40 Finally, Dancor argues that the circuit court erred in dismissing its tort claims. Dancor
argues as follows. First, it stated a claim for injurious falsehood under the Restatement (Second)
of Torts. A defendant is liable for a false statement harmful to the pecuniary interest of another
if the defendant either intended or knew that the publication was likely to result in harm and the
defendant either knew that the statement was false or recklessly disregarded the truth. See
Contract Development Corp. v. Beck, 255 Ill. App. 3d 660, 665 (1994). Here, Dancor alleged
that the statement in the mechanic’s lien was knowingly false; alleged that defendants intended
that the publication of the statement cause Dancor pecuniary harm; and alleged facts supporting
these elements, including the payments that were made under the contract and defendants’
publication of the statement.
¶ 41 Dancor acknowledges that Illinois has not expressly adopted the tort of injurious
falsehood. However, Dancor urges that, if necessary, this court should adopt the tort, noting that
some legal scholars have recommended its adoption.
¶ 42 Dancor continues that, in addition to stating a claim for injurious falsehood, it stated a
claim for slander of title. Illinois courts follow the Restatement (Second) of Torts to specify the
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elements necessary for a prima facie case of slander of title. See id. The three elements of
slander of title are: (1) a false and malicious publication (2) of words that disparage a person’s
title to property (3) that result in special damages. Id. Dancor argues that it pled a false and
malicious publication when it alleged that defendants’ statement that Dancor owed them
$104,544.11 was knowingly false. Dancor also pled that defendants used words that disparaged
its title to property. Defendants’ lien was detached from the real property and attached to
Dancor’s bond, and Dancor was consequently forced to put up $115,000 pursuant to its contract
with AutoZone. The lien on Dancor’s bond also clouded the title to these funds. Moreover,
Dancor pled special damages in the sum of $115,000—the money it had to place in escrow to
“bond over” the lien.
¶ 43 Last, Dancor argues that it stated a claim of “prima facie tort.” Dancor argues that the
concept of “prima facie tort” provides a remedy for tort injuries that do not conveniently fit into
a defined category. Citing English common law from the 1800s, Dancor argues that it is a well-
established common-law principle that a cause of action will lie for maliciously giving false
information. Dancor continues that Illinois follows the common-law prima facie tort doctrine, as
evidenced by our supreme court’s approving citation of Aikens v. State of Wisconsin, 195 U.S.
194 (1904), and statement that it is a “basic concept in the law that one who intentionally harms
another without excuse is liable for the harm.” Knierim v. Izzo, 22 Ill. 2d 73, 83 (1961). Here,
Dancor alleged that defendants knowingly and purposefully recorded a false lien in order to harm
Dancor in retaliation for removing them from the Project. Accordingly, Dancor argues, this was
enough to avoid a motion to dismiss for failure to state a cause of action in tort.
¶ 44 Defendants respond as follows. First, the circuit court acted within its discretion when it
dismissed the case in favor of a New York forum. In particular, defendants argue that section
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757 of the New York General Business Law (N.Y. Gen. Bus. Law § 757 (McKinney 2012))
rendered the forum-selection clause void and unenforceable. The forum-selection clause reads
as follows:
“The parties agree that this agreement was executed in Kane County, Illinois and shall be
governed by the law of the State of Illinois. Any claims, lawsuits, disputes or claims
arising out of or relating to this agreement shall be litigated in Kane County, Illinois.”
¶ 45 Defendants note that, despite the language of the forum-selection clause, the very next
page of the contract states that the agreement was executed in Santa Rosa Beach, Florida, not in
Kane County, Illinois. In any event, defendants argue that the clause violates section 757(1) of
the New York General Business law, which reads as follows:
“The following provisions of construction contracts shall be void and unenforceable:
1. A provision, covenant, clause or understanding in, collateral to or affecting a
construction contract, with the exception of a contract with a material supplier, that
makes the contract subject to the laws of another state or that requires any litigation,
arbitration or other dispute resolution proceeding arising from the contract to be
conducted in another state.” N.Y. Gen. Bus. Law § 757(1) (McKinney 2012).
Defendants cite HVS, LLC v. Fortney & Weygandt, Inc., 17 N.Y.S.3d 285, 286 (Sup. Ct. 2015),
where a New York trial court enforced section 757 to hold a forum-selection provision for
Cuyahoga County, Ohio, void and unenforceable.
¶ 46 Defendants note that their contract with Dancor concerned construction that took place in
New York. Therefore, defendants argue, section 757 applied and rendered the forum-selection
clause void and unenforceable. Although the circuit court initially found the forum-selection
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clause valid, it reconsidered its order and dismissed the case on the basis that the forum-selection
clause was void.
¶ 47 Defendants continue that Illinois law is nearly identical to New York law on the
enforceability of forum-selection clauses in construction contracts. They cite section 10 of the
Building and Construction Contract Act (Building Act) (815 ILCS 665/10 (West 2014)), which
provides:
“A provision contained in or executed in connection with a building and construction
contract to be performed in Illinois that makes the contract subject to the laws of another
state or that requires any litigation, arbitration, or dispute resolution to take place in
another state is against public policy. Such a provision is void and unenforceable.”
Defendants argue that section 10 of the Building Act demonstrates that Illinois law, just like New
York law, prohibits the litigation of construction contracts outside of the state where the
construction took place. To treat the New York law differently would be “quite anomalous and a
violation of comity.”
¶ 48 Defendants turn from section 757’s applicability to Dancor’s reasons why the forum
selection clause should be upheld regardless. First, defendants argue that the New York court’s
order does not collaterally estop litigation of the forum selection-clause here. Defendants point
to the New York court’s order, in which it stated that “the action to determine the payment
objections under the Mechanics’ Lien and whether the forum selection in Illinois is appropriate
was commenced prior and/or determined to [sic] the filing in New York.” They also deny that
the New York court found the forum-selection clause valid. Instead, they argue, the court merely
found that the forum-selection clause was not unreasonable, in contravention of public policy, or
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otherwise invalid. Defendants postulate that, had the New York court been presented with
section 757, it would have concluded differently.
¶ 49 Defendants continue that there is no case law requiring that an Illinois court honor the
decision of another state court dismissing a case under forum non conveniens or pursuant to a
forum-selection clause. They argue that a court from one state lacks the power to transfer a case
to another state’s court system. See Fennell v. Illinois Central R.R. Co., 2012 IL 113812, ¶ 13.
Accordingly, New York could not have transferred the case to Illinois. Furthermore, collateral
estoppel can apply only to separate and consecutive actions. Nowak v. St. Rita High School, 197
Ill. 2d 381, 389-90 (2001). Yet, they argue that this case is not separate from the New York
action. Rather, the two proceedings are two stages of one action.
¶ 50 Further, defendants argue that the New York court’s order was not a final judgment on
the merits, which is one of the necessary elements for collateral estoppel to apply. They argue
that a dismissal based upon a forum-selection clause is not an adjudication on the merits.
Further, a final judgment is a determination of the issue presented that ascertains and fixes
absolutely the rights of the parties. See Hernandez v. Pritiskin, 2012 IL 113054, ¶ 47.
Defendants argue that, simply, an order declining jurisdiction is not a final judgment. They
assert that the New York court’s order did nothing more than decline to exercise jurisdiction, in
the erroneous belief that the forum-selection clause was valid and enforceable. The order did not
bear on whether Dancor was liable to FXR under FXR’s mechanic’s-lien claim or determine the
rights of any party. Thus, collateral estoppel did not apply.
¶ 51 Defendants also argue that the circuit court had discretion to grant the motion to dismiss
less than 120 days prior to trial. Local Rule 6.06 provides that “[a]ll case or claim dispositive
motions, other than those arising during trial, will be filed for *** setting no longer than 120
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days before the designated trial date except by leave of court upon good cause shown.” 16th
Judicial Cir. Ct. R. 6.06(a) (May 5, 2008). Defendants argue that the rule gave the circuit court
discretion to hear FXR’s motion to dismiss. Nevertheless, defendants also argue that the motion
to dismiss was not really a dispositive motion—rather it was a motion to reconsider and transfer.
The circuit court did not dismiss the case with prejudice, and therefore its decision was not on
the merits. Defendants further argue that Dancor was not prejudiced, because it had time to
respond to FXR’s motion. Illinois courts have held that a violation of a local notice rule does not
prejudice a party who had sufficient time to respond. See Premier Electrical Construction Co. v.
American National Bank of Chicago, 276 Ill. App. 3d 816, 834 (1995) (holding that a 6-day
delay between service and hearing on motion for summary judgment—as opposed to 10 days
required by local rule—was not substantial and affirming despite the technical violation).
¶ 52 Defendants turn next to the application of forum non conveniens. Defendants argue that
both the private- and public-interest factors under forum non conveniens favored a transfer to
New York and that, contrary to Dancor’s contention, FXR did analyze the private- and public-
interest factors. With respect to the private-interest factors, it was undisputed that the case’s only
connection to Illinois was Dancor’s office in the state. All of the construction was performed in
New York. The witnesses (including the other subcontractors) and documents, the property, and
the building are all in New York. Thus, the private-interest factors clearly favored New York as
the proper forum. The public-interest factors likewise favored New York. New York has an
interest in adjudicating a construction dispute that occurred within its borders. Section 507 of the
New York Civil Practice Law and Rules (N.Y. C.P.L.R. ¶ 507 (McKinney 2012)) provides that,
where the judgment demanded would affect the title, use, or possession of real property, the trial
should take place in a county in which any part of the subject of the action is situated. A
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mechanic’s lien encumbers real property, and therefore an action to foreclose such a lien must be
brought in the county where the real property is located. Edward Joy Co. v. McGuire & Bennett,
Inc., 608 N.Y.S.2d 26, 26 (App. Div. 1993). Further, section 757 of the New York General
Business Law evinces a strong public policy to litigate in New York any dispute over New York
construction projects. N.Y. Gen. Bus. Law § 757 (McKinney 2012).
¶ 53 Defendants argue that, in contrast to section 757 of the New York General Business Law,
section 41 of the New York State Lien Law is not relevant to this case. Section 41 is not a venue
statute but rather allows a claimant to enforce a mechanic’s lien against either the property or the-
“person liable for the debt upon which the lien is founded” in any court that has jurisdiction.
N.Y. Lien Law § 41 (McKinney 2012). Therefore, section 757 of the New York General
Business Law controls.
¶ 54 Defendants turn to the circuit court’s section 2-615 dismissal of Dancor’s tort claims.
They argue that the dismissals were proper as follows. First, Dancor waived its claim for
injurious falsehood by failing to replead or incorporate that count in its second amended
complaint. They argue that, nevertheless, that count failed to state a claim for injurious
falsehood. Illinois has not formally recognized the tort of injurious falsehood. Pursuant to
section 623A of the Restatement (Second) of Torts, the tort is intended to protect economic
interests, that is, it is directed against disparaging comments about the quality of what the
plaintiff sells or the character of its business. Restatement (Second) of Torts § 623A (1977);
Kolegas v. Heftel Broadcasting Corp., 217 Ill. App. 3d 803, 811 (1991). Here, Dancor did not
allege that defendants made any disparaging comments about its business, products, or services.
Even if the tort were recognized and had a broader definition, Dancor failed to allege facts to
support that defendants knew that the statement in the mechanic’s lien they filed was false.
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¶ 55 With respect to Dancor’s slander-of-title claim, defendants continue that Dancor again
failed to plead the elements necessary to maintain a cause of action. A slander-of-title claim
requires that a plaintiff prove a false and malicious publication that disparages a person’s title to
property and results in special damages. However, Dancor pled only a conclusion that
defendants did not have a reasonable belief that they were entitled to a lien. Further, Dancor did
not own the real property at issue in this case. Dancor cannot claim slander of title when it did
not have title to the property. Moreover, Dancor did not incur special damages. The bond that
Dancor posted and held in escrow would be returned to it if the lien were ultimately found
unwarranted. The cost of posting the lien and litigating its merits are ordinary expenses, not
special damages.
¶ 56 Finally, with respect to Dancor’s prima facie tort argument, defendants respond that
Dancor failed to raise this claim in the circuit court. Even if not forfeited, the claim is a
facsimile of its injurious-falsehood and slander-of-title claims, which were not supported by
sufficient pleadings.
¶ 57 C. Resolution of Dancor’s Appeal
¶ 58 The circuit court dismissed various counts of Dancor’s amended and second amended
complaints, under sections 2-615 and 2-619, on September 5, 2013, and February 14, 2014,
respectively. It also granted a section 2-619 motion to dismiss the case on July 20, 2015, holding
that the forum-selection clause was void and unenforceable. A section 2-615 motion admits all
well-pled facts and attacks the legal sufficiency of the complaint, whereas a section 2-619
motion admits the legal sufficiency of the complaint but raises defects, defenses, or other
affirmative matters. La Salle National Bank v. City Suites, Inc., 325 Ill. App. 3d 780, 789
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(2001). We review a dismissal under either section de novo. Provenzale v. Forister, 318 Ill.
App. 3d 869, 874 (2001).
¶ 59 We first address whether the New York court’s order precluded the circuit court from
dismissing the case based on the forum-selection clause. In other words, the issue is whether
FXR was collaterally estopped from challenging the validity and enforceability of the forum-
selection clause.
¶ 60 Collateral estoppel, also known as issue preclusion, is a branch of res judicata.
Wakehouse v. Goodyear Tire & Rubber Co., 353 Ill. App. 3d 346, 351 (2004). Collateral
estoppel is an affirmative defense and is forfeited on appeal if not raised below. Midwest
Physician Group, Ltd. v. Department of Revenue, 304 Ill. App. 3d 939, 952 (1999); cf. People v.
Anderson, 2013 IL App (2d) 121346, ¶¶ 13-14 (normally, collateral estoppel is an affirmative
defense that is forfeited if not pled, but it may be first raised on appeal if unavailable in the trial
court). The doctrine, if it applies, bars relitigation of issues decided in a prior action.
Wakehouse, 353 Ill. App. 3d at 351.
¶ 61 In order for collateral estoppel to apply, the party seeking to apply it must establish that:
(1) the issue at hand is identical to the one in a prior action; (2) there was a prior, final
adjudication on the merits; and (3) the party against whom preclusion is sought was a party to or
in privity with a party to the prior action. In re A.W., 231 Ill. 2d 92, 99 (2008). Moreover, the
issue had to have been actually and necessarily litigated in the prior action. LaSalle Bank
National Ass’n v. Village of Bull Valley, 355 Ill. App. 3d 629, 636 (2005). Collateral estoppel is
an equitable doctrine and, even if the threshold elements are established, the doctrine will not be
applied if it would result in injustice. Edmonds v. Illinois Workers’ Compensation Comm’n,
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2012 IL App (5th) 110118WC, ¶ 21. The party against whom estoppel is sought must have had
both a full and fair opportunity and an incentive to litigate the issue in the prior proceeding. Id.
¶ 62 Here, in response to FXR’s motion to dismiss, Dancor argued that the New York action
precluded litigation of the forum-selection clause’s validity and enforceability. Dancor therefore
has not forfeited its argument on appeal. Dancor argues that all three elements of collateral
estoppel are met here, but the crucial determination is whether the New York court issued a final
judgment on the merits. If the New York action did not produce a final judgment on the merits,
there was no basis to preclude litigation of the forum-selection clause in the circuit court.
¶ 63 Under the full-faith-and-credit clause of the United States Constitution (U.S. Const., art.
IV, § 1 (“Full Faith and Credit shall be given in each State to the public Acts, Records, and
judicial Proceedings of every other State.”)), the doctrine of collateral estoppel extends to
judgments entered in foreign states. Allianz Insurance Co. v. Guidant Corp., 387 Ill. App. 3d
1008, 1021 (2008). This clause requires that we give the judgment of another state “at least the
res judicata effect that the sister state rendering the judgment would give to it.” Morris B.
Chapman & Associates, Ltd. v. Kitzman, 193 Ill. 2d 560, 565 (2000). We must look to the forum
state’s res judicata law to determine what preclusive effect, if any, that state would give the
judgment. Id. (looking to Missouri law). However, at least one court has held that the full-faith-
and-credit clause does not necessarily prevent Illinois from according greater effect to a foreign
state’s judgment. Finley v. Kesling, 105 Ill. App. 3d 1, 7 (1982). That is, the full-faith-and-
credit clause does not bar Illinois from applying its own rules of collateral estoppel to preclude
relitigation of an issue where, for example, New York would not. Id.
¶ 64 Under New York law, collateral estoppel precludes a party from relitigating an issue
“ ‘clearly raised in a prior action or proceeding and decided against that party or those in
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privity.’ ” Church v. New York State Thruway Authority, 791 N.Y.S.2d 676, 678-79 (App. Div.
2005) (quoting Ryan v. New York Telephone Co., 467 N.E.2d 487, 500 (N.Y. 1984)). The party
seeking to apply the doctrine must show that the identical issue was necessarily decided in the
prior action, and the party opposing application of the doctrine may demonstrate the absence of a
full and fair opportunity to contest the prior determination. Id. at 679. A final judgment is
necessary for collateral estoppel to apply. Id.
¶ 65 Importantly, New York applies collateral estoppel only to issues of fact, not law. Abreu
v. Coughlin, 555 N.Y.S.2d 889, 891 (App. Div. 1990); In re Department of Personnel of the City
of New York v. City Civil Service Comm’n, 462 N.Y.S.2d 878, 879 (App. Div. 1983). Further,
New York has held that the issue of a forum-selection clause’s applicability is a question of law
and is therefore not barred by the doctrine of collateral estoppel. Sterling National Bank v.
Eastern Shipping Worldwide, Inc., 826 N.Y.S.2d 235, 237 (App. Div. 2006). Interpretations of
unambiguous contract provisions, such as the forum-selection clause in Sterling National Bank,
are questions of law. Id.; Taussig v. Clipper Group, L.P., 787 N.Y.S.2d 10, 11 (App. Div. 2004)
(“The interpretation of an unambiguous contract is a question of law for the court ***.”).
Accordingly, under New York law, the issue of whether the forum-selection clause here was
valid and enforceable was a question of law and cannot be the basis for collateral estoppel.
Sterling National Bank, 826 N.Y.S.2d at 237; see Lischinskaya v. Carnival Corp., 865 N.Y.S.2d
334, 337 (App. Div. 2008) (forum-selection clause’s enforceability under federal maritime law
was a question of law).
¶ 66 Nor does Illinois law provide greater effect and preclude litigation of the forum-selection
clause. Collateral estoppel in Illinois requires a final judgment on the merits, but a dismissal for
improper venue is not a final judgment on the merits. Ill. S. Ct. R. 273 (“[A]n involuntary
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dismissal of an action, other than a dismissal for lack of jurisdiction, for improper venue, or for
failure to join an indispensable party, operates as an adjudication on the merits.” (Emphases
added.)); see Richter v. Prairie Farms Dairy, Inc., 2015 IL App (4th) 140613, ¶ 34 (a dismissal
order that otherwise specified that it was not on the merits was not on the merits). Therefore,
there is no basis in New York or Illinois law to hold that the New York action precluded
litigation of the forum-selection clause.
¶ 67 Having held that the circuit court was free to examine the validity and enforceability of
the forum-selection clause, we turn to examine whether, in fact, the circuit court was correct in
holding that the clause was void and unenforceable.
¶ 68 Dancor argues that the clause was valid and enforceable, citing section 41 of the New
York Lien Law (N.Y. Lien Law § 41 (McKinney 2012)). Defendants counter that the controlling
law is actually section 757 of the New York General Business Law (N.Y. Gen. Bus. Law § 757
(McKinney 2012)), which, they argue, renders the clause void and unenforceable.
¶ 69 Forum selection and choice of law are separate issues. Brandt v. MillerCoors, LLC, 2013
IL App (1st) 120431, ¶ 15. Under Illinois law, we may void a forum-selection clause if it would
violate a fundamental Illinois public policy. Maher & Associates, Inc. v. Quality Cabinets, 267
Ill. App. 3d 69, 75 (1994). Generally, to determine whether a forum-selection clause is
enforceable, Illinois courts have applied a multifactor test to determine whether the clause is
reasonable. See IFC Credit Corp. v. Rieker Shoe Corp., 378 Ill. App. 3d 77, 86 (2007)
(considering (1) the law governing the formation and construction of the contract, (2) the
residency of the parties, (3) the place of execution or performance of the contract, (4) the
location of the parties, (5) the inconvenience of the location, and (6) the parties’ relative
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bargaining positions); Calanca v. D&S Manufacturing Co., 157 Ill. App. 3d 85, 88 (1987)
(same).
¶ 70 In Rieker Shoe Corp., the court addressed both whether the parties’ forum-selection
clause was invalid and whether its enforceability should be construed under another state’s law.
Rieker Shoe Corp., 378 Ill. App. 3d at 85-86, 93-94. Applying the multifactor reasonableness
test, the court found the forum-selection clause valid in Illinois. Id. at 86. Separately, it
disagreed that Illinois’s choice-of-law rules dictated the application of New Jersey law, under
which a forum selection-clause such as the one between the parties was not enforceable. Id. at
93. The court cited the parties’ agreement, which provided that it was governed by Illinois law
“ ‘without regard to such State’s choice of law considerations.’ ” Id. at 94. Therefore, the court
found, Illinois law applied and, under the reasonableness test it had already performed, the
forum-selection clause was enforceable. Id.
¶ 71 Here, the parties chose Illinois as the forum state. Unlike in Rieker, there is no clause
requiring that we ignore Illinois choice-of-law rules. Therefore, to examine whether New York
law applies to interpreting the forum-selection clause, we turn to Illinois’s choice-of-law rules.
See Western States Insurance Co. v. Zschau, 298 Ill. App. 3d 214, 223 (1998) (Illinois courts
apply Illinois choice-of-law rules). Defendants have not argued that the forum-selection clause
violates Illinois public policy or is unreasonable under Illinois law, only that New York law
applies to render the clause void and unenforceable.
¶ 72 Choice-of-law considerations arise only if there is an actual conflict of law among the
states with an interest in a particular dispute. Allianz Insurance Co. v. Guidant Corp., 373 Ill.
App. 3d 652, 658 (2007). An actual conflict exists if application of one state’s law will yield a
different result than the application of another’s, that is, if it will affect the outcome of the
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dispute. Id.; Gleim v. Roberts, 395 Ill. App. 3d 638, 639 (2009). Illinois generally follows the
Restatement (Second) of Conflict of Laws (1971) in making choice-of-law decisions. Hall v.
Sprint Spectrum L.P., 376 Ill. App. 3d 822, 825 (2007). But see Maher & Associates, Inc., 267
Ill. App. 3d at 77 (the Restatement is a guide for courts, “not black-letter law to be upheld
against all other considerations”).
¶ 73 Section 187 of the Restatement applies when, as here, the parties have made an express
choice of law in their contract. Restatement (Second) of Conflict of Laws § 187 (1971); Hall,
376 Ill. App. 3d at 825; Maher & Associates, Inc., 267 Ill. App. 3d at 76. In particular, section
187(2) provides:
“The law of the state chosen by the parties to govern their contractual rights and duties
will be applied *** unless either
(a) the chosen state has no substantial relationship to the parties or the transaction
and there is no other reasonable basis for the parties’ choice, or
(b) application of the law of the chosen state would be contrary to a fundamental
policy of a state which has a materially greater interest than the chosen state in the
determination of the particular issue and which, under the rule of § 188, would be
the state of the applicable law in the absence of an effective choice of law by the
parties.” Restatement (Second) of Conflict of Laws § 187(2) (1971).
To ascertain the public policy of a state, we look to its constitution, legislative enactments, and
judicial decisions. Hall, 376 Ill. App. 3d at 826.
¶ 74 Accordingly, our task is to first determine whether there is a conflict between New York
and Illinois law. The plain language of section 757 provides that a construction contract
provision that requires litigation, arbitration, or other dispute resolution arising from the contract
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to be conducted in another state is void and unenforceable. N.Y. Gen. Bus. Law § 757(1)
(McKinney 2012). Here, we have a construction contract for a New York construction project.
Exceptions to section 757’s applicability, such as an exception for a contract with a material
supplier, do not apply. Defendants are correct that section 757, by its plain language, requires
that, if you build in New York, you litigate in New York. See HVS, LLC, 17 N.Y.S.3d at 286
(enforcing section 757 to invalidate forum-selection clause, which required litigation in Ohio, in
a contract for a construction project located in New York); see also Welsbach Electric Corp. v.
MasTec North America, Inc., 859 N.E.2d 498, 502 n.8 (App. Div. 2006) (section 757 was
enacted to render void any provision that makes a construction contract subject to the laws of
another state).
¶ 75 In Illinois, a forum-selection clause in a contract is prima facie valid and should be
enforced unless the opposing party shows that enforcement would be unreasonable under the
circumstances. Rieker Shoe Corp., 378 Ill. App. 3d at 85-86. A forum-selection clause reached
through arm’s-length negotiation should be honored and enforced by the courts, absent a
compelling and countervailing reason not to enforce it. Mellon First United Leasing v. Hansen,
301 Ill. App. 3d 1041, 1045 (1998). Defendants have not argued that the forum-selection clause
is void and unenforceable under Illinois law. Because the forum-selection clause is prima facie
valid under Illinois law but void under New York law, the forum-selection-clause issue would be
decided differently depending on which forum’s law applies. Accordingly, we have a conflict
and proceed with a choice-of-law analysis.
¶ 76 Guided by the Restatement, we will apply Illinois law to interpret the forum-selection
clause, unless one of the following applies: (1) Illinois has no substantial relationship to the
parties or the transaction and there is no other reasonable basis for the parties’ choice; or (2)
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application of Illinois law would be contrary to a fundamental New York policy, and New York
has a materially greater interest than Illinois in the determination of this issue. See Old Republic
Insurance Co. v. Ace Property & Casualty Insurance Co., 389 Ill. App. 3d 356, 363 (2009). The
basic reasoning behind these exceptions is that, in addition to fulfillment of the parties’
expectation, regard must also be had for state interests and for state regulation. Restatement
(Second) of Conflict of Laws § 187, cmt. g (1971).
¶ 77 The first exception does not apply, because there was a reasonable basis to choose Illinois
as the forum state. Dancor is an Illinois corporation with a place of business in Illinois, which is
generally sufficient to satisfy the “reasonable basis” for a choice of law. See International
Surplus Lines Insurance Co. v. Pioneer Life Insurance Co. of Illinois, 209 Ill. App. 3d 144, 154
(1990) (citing Restatement (Second) of Conflict of Laws § 187, cmt. f (1971)).
¶ 78 On the other hand, we hold that the second exception does apply to this particular case.
We explain as follows. Section 187 of the Restatement requires that the New York policy be
“fundamental.” Restatement (Second) of Conflict of Laws § 187 (1971). The comments do not
define “fundamental” but do state that the policy must be “a substantial one.” Restatement
(Second) of Conflict of Laws § 187, cmt. g (1971). For example, a fundamental policy must
relate to more than mere formalities in a contract. Id. Fundamental policies include state statutes
that make certain contracts illegal or are designed to protect a person from another with superior
bargaining power. Id. Statutes involving the rights of an individual insured against an insurance
company would qualify. Id.
¶ 79 We have held that an Illinois statue that declared void any attempted contractual waiver
of the statute was a fundamental public policy. Maher & Associates, Inc., 267 Ill. App. 3d at 76
(interpreting the Sales Representative Act (820 ILCS 120/2 (West 1992)), and explaining that the
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difference between “void” and “void against public policy” was merely semantic). Similarly,
we hold that section 757 of the New York General Business Law is a fundamental public policy
in New York. A state’s legislative enactments reveal a state’s public policy. Hall, 376 Ill. App.
3d at 826. Here, section 757 of the New York General Business Law clearly evinces New
York’s public policy that construction contracts for New York construction projects be litigated
in New York. See supra ¶ 73. Section 757 declares void and unenforceable specific provisions
of construction contracts so that New York maintains an interest in construction within its
borders. To enforce the forum-selection clause would be to disregard section 757 and New
York’s public policy regarding construction contracts.
¶ 80 Additionally, New York has a materially greater interest in the determination of the
forum-selection-clause issue. The subject matter of the contract, the AutoZone building, is in
New York. Performance of the contract took place in New York. Defendants are from New
York. Although the parties’ contract states in section XXIX that the contract was executed in
Kane County, the very next page (and the first page of the contract) contradict this statement,
stating that the contract was executed in Florida. The only connection Illinois has to the
litigation is Dancor’s incorporation and place of business here, and we cannot say that this
counterbalances New York’s connections. Cf. Old Republic Insurance Co., 389 Ill. App. 3d at
363 (Illinois did not have a materially greater interest in the litigation than Nebraska, where
litigation involved insurance companies from Nebraska and an agreement negotiated in
Nebraska); Maher & Associates, Inc., 267 Ill. App. 3d at 76 (applying the Restatement, Illinois
did not have a materially greater interest than Texas where defendant was incorporated in Texas,
had its primary place of business in Texas, and the contract at issue was a Texas contract;
plaintiff had its primary place of business in Illinois but was incorporated in Minnesota and did
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business in multiple states); Hall, 376 Ill. App. 3d at 826 (Illinois did not have a materially
greater interest in the litigation than Kansas or Missouri in multistate suit against
telecommunications corporations incorporated in Kansas and Missouri).
¶ 81 We are mindful that the Restatement is a guide, not black-letter law. Maher &
Associates, 267 Ill. App. 3d at 77. Illinois follows the modern approach to choice-of-law
questions, placing the greatest importance on the public policy of the state in which the case is
brought. Id. Nevertheless, this is a situation where New York has a clear public policy and
Illinois does not have a competing interest in the litigation. In fact, Illinois implicitly shares New
York’s interest, as Illinois has a similar public policy that contracts for Illinois construction be
litigated in Illinois. 2
¶ 82 Nevertheless, Dancor argues that, if we apply New York law, section 41 of the New York
Lien Law controls. We disagree. That section provides that a mechanic’s lien on real property
may be enforced against such property or against a person liable for the debt upon which the lien
is founded in any of the following: the New York supreme court or a county court otherwise
having jurisdiction, regardless of the amount of the debt, or any court with jurisdiction in an
action founded on a contract for a sum of money equivalent to the amount of such debt. N.Y.
2
Section 10 of the Building Act provides that an Illinois construction contract provision
that requires “any litigation, arbitration, or dispute resolution to take place in another state is
against public policy. Such a provision is void and unenforceable.” 815 ILCS 665/10 (West
2014). The plain language is clear that, if you build in Illinois, you litigate in Illinois. Cf. Foster
Wheeler Energy Corp. v. LSP Equipment, LLC, 346 Ill. App. 3d 753, 762 (2004) (holding that,
because section 10 of the Building Act substantively changed the law on forum-selection
provisions, it would not apply retroactively to void the parties’ forum-selection provision).
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Lien Law § 41 (McKinney 2012). This general provision does not obviate consideration of the
more specific section 757 of the New York General Business Law. Section 41 merely permits
enforcement of mechanic’s liens in various courts other than New York supreme or county
courts, with some limitation on the sum of money sought. In contrast, section 757 speaks
specifically to the validity and enforceability of forum-selection clauses in construction
contracts. As we explained, supra ¶¶ 78-80, section 757 renders the forum-selection clause void
and unenforceable.
¶ 83 Accordingly, the circuit court did not err in applying New York law to find the forum-
selection clause void and unenforceable.
¶ 84 Dancor and defendants next argue over whether dismissing the case under forum non
conveniens was appropriate. However, we have already held that the circuit court properly
dismissed the case after finding that the forum-selection clause was void and unenforceable. The
circuit court’s order does not analyze the application of the forum non conveniens doctrine,
because its order is based on the affirmative matter of the applicability of New York law.
Accordingly, we do not further address the forum non conveniens arguments.
¶ 85 We further hold that the circuit court did not err in granting FXR’s motion to dismiss
less than 120 days before trial. Local Rule 6.06 does not bar dispositive motions filed less than
120 days before trial. Rather, it permits such motions upon leave of court for good cause shown.
16th Judicial Cir. Ct. R. 6.06 (May 5, 2008) (“All case or claim dispositive motions *** will be
filed for setting no longer than 120 days before the designated trial date except by leave of court
upon good cause shown.”). Here, the circuit court acknowledged the local rule in its order
granting FXR’s motion to dismiss. However, it effectively provided that there was good cause
for the motion, in that its prior order allowing the case to proceed in Illinois was in error. The
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court had not been apprised of the applicable law providing that New York was the proper forum
and that the forum-selection clause was void and unenforceable. We agree that this was good
cause to hear the motion to dismiss. Moreover, the court’s prior order was interlocutory, FXR’s
motion to dismiss was, in part, a motion to reconsider, and the court could reconsider its prior
order at any time before trial.
¶ 86 The final issues are whether the circuit court properly dismissed Dancor’s tort counts for
injurious falsehood and slander of title. It dismissed these counts before its July 20, 2015, order,
which held that, as to the entire action, the forum-selection clause was void and unenforceable.
Dancor’s injurious-falsehood count was part of its amended complaint, and the circuit court
dismissed it without prejudice, informing Dancor that, if it sought to replead the count, it should
do so as slander of title. In Dancor’s second amended complaint, it did not replead an injurious-
falsehood count but instead took the circuit court’s admonishment to plead two counts of slander
of title. The circuit court dismissed the slander-of-title counts in the second amended complaint
with prejudice. Dancor thereafter moved to incorporate the prior injurious-falsehood count into
the second amended complaint, but the circuit court denied its motion.
¶ 87 We need not review the dismissal of Dancor’s tort counts. We have already determined
that the circuit court properly dismissed the case pursuant to its interpretation of the forum-
selection clause, finding that it was void and unenforceable. Accordingly, Dancor is free to refile
this action in New York, where the New York court will address its complaint. Although the
circuit court’s dismissal was a final order, it was not on the merits. We do not address whether
Dancor’s tort counts, if it chooses to refile them, would state causes of action under New York
law.
¶ 88 C. Defendants’ Arguments on Cross-Appeal
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¶ 89 On cross-appeal, defendants argue that the circuit court should have granted their
original motion to dismiss the case based on forum non conveniens. They note that, if we affirm
the circuit court’s order on Dancor’s appeal, the cross-appeal is unnecessary. Because that is
precisely what we have done, we do not address their cross-appeal.
¶ 90 III. CONCLUSION
¶ 91 The forum-selection clause in the parties’ contract was void and unenforceable, and
therefore the circuit court did not err in dismissing the case in order that it may be refiled in New
York. Dancor’s arguments with respect to the dismissal of its tort counts are mooted by our
determination that New York is the proper forum to adjudicate the parties’ claims. Further, our
holdings render defendants’ cross-appeal moot. Therefore, the judgment of the circuit court of
Kane County is affirmed.
¶ 92 Affirmed.
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