August 29, 2008

Seventh Circuit Dismisses Government Appeal Of Qualified Immunity Defense

Ahmad Khorrami claimed he was wrongfully detained and mistreated by the federal government in an investigation stemming from the 9/11 terrorist attack. Khorrami sued Michael Rolince, an FBI agent on whose affidavit Khorrami allegedly was detained, and the government. The lawsuit alleged multiple causes of action, including one against Rolince — Khorrami claimed Rolince’s affidavit was false — for violation of Fifth Amendment due process rights.

The government moved to dismiss the complaint (1) for failure to state a claim and (2) arguing that Rolince had qualified immunity for his affidavit. The trial court granted all aspects of the motion, except that it declined to rule on the government’s claim for qualified immunity. The government brought an interlocutory appeal, arguing there was qualified immunity and that the whole case should have been dismissed.

The Seventh Circuit Court of Appeals dismissed the appeal. Because the immunity defense was postponed for later ruling by trial court, and not specifically ruled upon, there was not an order rejecting the immunity defense, which was a requirement for appeal. In addition, this was not a de facto denial of the immunity defense caused by a delay in ruling. The order setting aside the immunity ruling did not have a direct or irreparable impact on the merits of the case.

Get the whole case, Khorrami v. Rolince, No. 07-2755 (8/27/08), by clicking here.

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August 27, 2008

Certified Question Improper Under Illinois Supreme Court Rule 308, But Appellate Court Takes Interlocutory Appeal Anyway

Jerry Walker suffered a personal injury when she fell while cruising on a Carnival Cruise Line ship. She sued Carnival in Illinois, but her ticket stated that disputes must be litigated in Miami, Florida. Carnival sought dismissal of Jerry’s lawsuit, arguing that Illinois was not the proper forum. The Illinois trial court ruled that the forum-selection provision on Jerry’s ticket was unenforceable, and denied Carnival’s motion.

Because an order denying a motion to dismiss is not final and appealable, Carnival asked for permission to appeal. The trial court allowed the interlocutory appeal, and, pursuant to Illinois Supreme Court Rule 308, certified the following question for the appellate court to answer: “Whether the trial court erred in its application of law pertaining to its denial of Carnival's … motion to dismiss …”

Rule 308 interlocutory appeals are allowed when the trial court certifies “a question of law as to which there is substantial ground for difference of opinion and where an immediate appeal from the order may materially advance the ultimate termination of the litigation.” The First District Illinois Appellate Court ruled that the question certified by the trial court was not a proper Rule 308 question.

Here, the first certified question, as framed by the circuit court, although properly couched in Rule 308 language, essentially asks this court to review the underlying order, finding the forum-selection clause unenforceable. This request is merely seeking a review of the trial court's application of the law to a given set of facts rather than a properly written certified question which articulates a specific question of law.

Citing the “interest of judicial economy and reaching an equitable result,” the appellate court decided to take the appeal despite the improper certified question. In the end, the court ruled that Carnival’s forum-selection provision was enforceable. Read the whole case, Walker v. Carnival Cruise Lines, No. 1-07-3538 (5/21/08) by clicking here. (Free subscription through Lexis One required.)

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August 24, 2008

Constructive Re-filing Of Reconsideration Motion Provides Appellate Jurisdiction Over Insurer’s Appeal Of Coverage Dispute

Stoneridge Development Company built a townhouse for John and Marie Walski. The Walskis claimed the house suffered from structural defects caused by Stoneridge building on soil that was not compacted appropriately. After the Walskis sued Stoneridge, Stoneridge sued Essex Insurance Company, its general liability insurer, for insurance coverage for the Walskis lawsuit.

The trial court ruled that Essex had an undisclosed conflict of interest, was therefore prevented from denying coverage, and entered summary judgment for Stoneridge. Essex appealed, but Stoneridge asked the appeal to be dismissed for lack of appellate jurisdiction.

The trial court had written an opinion letter in July stating how it intended to rule and directing the parties to draft an order granting the summary judgment. Essex filed a motion to reconsider after that opinion letter was written, but before the judgment was entered. When the judgment in Stoneridge’s favor was entered, the trial court also entered and continued Essex’s motion to reconsider.

A motion to reconsider the judgment ordinarily tolls the time to file an appeal for 30 days from time there is a ruling on the motion. But Stoneridge argued that this reconsideration motion did not toll the time to appeal because it was filed before the judgment was entered. The Second District Illinois Appellate Court disagreed, and ruled that the motion for reconsideration had been constructively re-filed when the trial court entered and continued it, vesting appellate jurisdiction to hear Essex’s appeal. Here’s what the appellate said:

“While Essex filed its motion to reconsider on August 7, 2006, after the trial court's letter opinion but before the filing of the final judgment, the final judgment corresponded to the letter opinion, and Essex's motion therefore also attacked or "was directed against" the substance of the judgment. Immediately after the trial court entered the August 15, 2006, final judgment, it "entered and continued" Essex's motion to reconsider. When a trial court enters and continues a motion, the result is that the motion is left pending … Therefore, the effect of the trial court's action was a constructive refiling of Essex's motion to reconsider on August 15, 2006, within the 30-day period for filing an appeal, tolling the time to file a notice of appeal until the motion to reconsider was resolved.”

Read the whole opinion, Stoneridge Development v. Essex Insurance, No. 2-06-1166 (5/6/08), by clicking here. (Free account required.)

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August 12, 2008

Standard Of Review For Dying Declaration: Palpably Contrary To The Manifest Weight Of The Evidence

Howard Berry sued 40-plus companies for his damages from contracting mesothelioma as a result of exposure to asbestos. He died before his discovery deposition was completed and before his evidence deposition was taken. Howard’s wife, Linnie, continued the lawsuit as representative of Howard’s estate.

The companies moved to bar the use of Howard’s discovery deposition at trial. The trial court granted the motion because, with few exceptions, Illinois law does not allow the discovery deposition of a party, even though unavailable, to be read into evidence. The companies then moved for summary judgment on the basis that Howard’s estate could not prove its case without Howard’s testimony. The trial court agreed and entered summary judgment against the estate.

Linnie appealed. The estate argued, among other things, that Howard’s discovery deposition was a “dying declaration,” and could come into evidence as an exception to the hearsay rule. The Fifth District Illinois Appellate Court disagreed. The appellate court stated the standard of review for “determination of whether a particular statement constitutes a dying declaration … [is whether the court’s] findings are palpably contrary to the manifest weight of the evidence.” The discovery deposition was not a dying declaration because the estate did not show that Howard thought his death was imminent at the time he gave the deposition.

Read the whole case, Berry v. American Standard, No. 5-06-0621 (5/19/08), by clicking here.

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August 9, 2008

Order Postponing Insurer’s Motion To Stay Pending Arbitration “Incident To An Orderly Process” And Not Appealable

Insurer CNA was involved in a complicated dispute with a claim handling company, Staffing Concepts. Staffing Concepts made claims on the worker compensation policies that it bought from CNA. CNA claimed that Staffing Concepts refused to pay millions of dollars for the deductibles on claims made by its employees.

There was a related dispute between Staffing Concepts and ClaimPlus, a company that serviced claims made by the Staffing Concepts employees. ClaimPlus asserted that Staffing Concepts did not pay the claim handling fee. So ClaimPlus filed an arbitration claim against Staffing Concepts.

Staffing Concepts then moved to transfer CNA’s case from Illinois to Florida. Some of the Staffing Concepts affiliates, also defendants in the case, moved to dismiss the complaint for lack of personal jurisdiction. CNA in turn asked the court to stay the case, and to put the Staffing Concepts’ motions on hold, pending the outcome of the arbitration between ClaimPlus and Staffing Concepts.

The trial court preferred to rule on Staffing Concepts’ motions first. So it struck CNA’s motion to stay, with leave to refile after the motions to dismiss and change venue were ruled on.

CNA appealed under the Federal Arbitration Act, which permits appeals from orders refusing to stay a case in which arbitration has been demanded or denying a petition to order arbitration to proceed. CNA claimed that the postponement of its motion to stay was the equivalent to denying it.

The Seventh Circuit Court of Appeals disagreed with CNA and dismissed the appeal for lack of appellate jurisdiction. The court referred to the postponement of CNA’s motion as a “delay incident to an orderly process.” It was not “ground for appellate jurisdiction unless irreparable damage could be shown. CNA has shown none, and so there is no basis for us to hear its appeal.”

The whole case, Continental Casualty Co. v. Staffing Concepts, Inc., No. 07-2475 (8/6/08), is available by clicking here.

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August 8, 2008

Homeowners Forfeit Argument In Illinois Supreme Court That Wasn’t Raised In Petition For Leave To Appeal

MD Electrical Contractors subcontracted to do work at defendants’ home. The homeowners did not pay for the work, so MD sued for the money. Because there was not a written contract, MD’s complaint used a theory of quantum meruit (that MD should be paid for the value of the work it performed). The homeowners moved to dismiss MD’s complaint, claiming that MD did not comply with the Illinois Home Repair and Remodeling Act. The trial court agreed with the homeowners and dismissed the case. But the appellate court reversed, ruling that the Repair and Remodeling Act applied only to contractors, not subcontractors.

The homeowners took the case to the Illinois Supreme Court, which agreed with MD that the Act did not apply to subcontractors. The Act, the court ruled, could not be used as a defense to a quantum meruit suit by the electrical subcontractor.

In their petition for leave to appeal to the Illinois Supreme Court, the homeowners raised only one issue, the applicability of the Repair and Remodeling Act. But in their brief to the court, the homeowners also argued that the Illinois Mechanics Lien Act restricted MD’s claim for compensation, and that MD’s request for quantum meruit damages went beyond the Mechanics Lien Act. MD in turn argued that the homeowners forfeited their Mechanics Lien argument because it was not raised in the petition for leave to appeal, as required by Illinois Supreme Court Rule 315.

The supreme court agreed that the homeowners forfeited the argument because the “question was not properly presented in the defendants' petition for leave to appeal …” The homeowners argued that forfeiture did not apply because they raised the Mechanics Lien argument in the appellate court. But the supreme court said that was a “red herring.” The relevant question was “whether the issue is properly raised by the trial court record and can now be utilized to support the finding of the trial court.”

The whole case, MD Electrical Contractors v. Abrams, No. 104000 (4/3/08), is available by clicking here.

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August 3, 2008

Argument Raised For First Time On Motion For Reconsideration Waived For Appeal

Unhappy with the treatment she received from her dentist, Jill Caywood sued him for malpractice. The dentist moved to dismiss Jill’s complaint for lack of compliance with the statute of limitations. The trial court granted the dentist’s motion, and Jill moved for reconsideration. In her reconsideration motion, Jill argued for the first time “that she suffered from mental incapacitation and was unable to appreciate that she had been injured by defendants' wrongful treatment.” The trial court disregarded the argument and denied the motion.

On appeal, Jill claimed it was reversible error for the trial court not to address the argument. The First District Illinois Appellate Court affirmed the dismissal for two reasons: (1) the evidence of Jill’s incapacitation existed, and should have been raised, in defense to the motion to dismiss; (2) “arguments raised for the first time in a motion for reconsideration in the circuit court are waived on appeal.”

Get the whole case, Caywood v. Gossett, No. 1-06-2458 (4/11/08), by clicking here.

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