The opinion of the court was delivered by: Aspen, District Judge:
MEMORANDUM OPINION AND ORDER
Plaintiff, Nancy Harl ("Harl"), brought this action against
defendants, City of LaSalle ("LaSalle") and Aloysius Gunia
("Gunia"), the mayor and liquor commissioner of LaSalle,
alleging that revocation of her liquor license by the
defendants violated state and federal law. Federal
jurisdiction is asserted pursuant to 42 U.S.C. § 1983 and
28 U.S.C. § 1331, 1343.
On January 21, 1980, Harl filed a complaint against LaSalle
and Gunia in LaSalle County Circuit Court. Defendants moved
for dismissal of the complaint and on July 10, 1980, Chief
Judge Flood granted their motion, but allowed Harl leave to
amend her complaint by August 15, 1980. Harl failed to amend
her complaint in the alloted time period, and the Court, on
its own motion, entered an order dismissing her complaint on
September 3, 1980.*fn1 Harl initiated this federal action
thereafter.*fn2 The matter is presently before this Court on
defendants' motion to dismiss on the ground of res
Examination of Harl's state and federal complaints reveal
that they are strikingly similar. The federal complaint varies
from the state complaint in three respects: the federal
complaint alleges violations of 42 U.S.C. § 1983, denial of a
hearing, and failure to receive written notice of Gunia's
unfavorable decision on Harl's right to appeal.
In their motion to dismiss, defendants contend that since
Judge Flood's September 3 dismissal of Harl's complaint for
failure to timely amend her complaint was a final order, it
precludes Harl's federal action on the basis of res judicata
and full faith and credit. Harl, in turn, claims that Judge
Flood's order was not final; hence, res judicata and full
faith and credit do not apply.
Illinois Supreme Court Rule 273 provides:
Unless the order of dismissal or a statute of
this state otherwise specifies, an involuntary
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.
Ill.Rev.Stat. 1977, ch. 110A, § 273. The Seventh Circuit
recently construed Rule 273 in Gilbert v. Braniff International
Corporation, 579 F.2d 411 (7th Cir. 1978). In Gilbert,
plaintiffs originally brought suit in the Circuit Court of Cook
County. The state court granted defendant's motion to dismiss,
with leave given to amend the complaint within 28 days. Id. at
412. Rather than amend their state complaint, the Gilbert
plaintiffs filed an action in the United States District Court
based on the same operative facts and involving the same
parties as the state suit. Because the state court granted
plaintiffs leave to amend and the defendant did not seek the
entry of an order dismissing the cause with prejudice, the
Seventh Circuit held that the order of dismissal with leave to
amend fell within the "otherwise specifies" exception to
Illinois Supreme Court Rule 273. Id. at 413. Unlike Gilbert,
Harl's complaint was not merely dismissed with leave to amend.
In fact, the Gilbert court specifically distinguished
an open-ended "order of dismissal with leave to amend" from an
order of dismissal after a failure to amend; the court noting
that the latter operated as a final order under Rule 273,
id., citing Brainerd v. First Lake Co. National Bank of
Libertyville, 1 Ill. App.3d 780, 275 N.E.2d 468 (2d Dist.
In Brainerd, the Illinois Appellate Court construed Rule 273
in a factual setting nearly identical to the present suit.
There, the complaint was dismissed, but plaintiff was granted
leave to amend. When the Brainerd plaintiff failed to amend as
directed, the trial court dismissed his cause "with prejudice."
1 Ill. App.3d at 782, 275 N.E.2d at 469. Brainerd then
initiated a second action based on the same facts. The trial
court ruled that res judicata barred his claim. The Illinois
Appellate Court held that the dismissal caused by Brainerd's
failure to amend barred his second suit because the judgment
order "with prejudice" did not fall within the Rule 273
exceptions and thus operated as an adjudication upon the merits
of the case. Id. at 782, 275 N.E.2d at 469-70.
The only distinction between Brainerd and the instant case is
that Judge Flood did not use the phrase "with prejudice" in his
September 3 Order dismissing Harl's complaint. This
distinction, however, is insignificant. Rule 273 clearly
requires that since Harl's state court complaint was not
dismissed for lack of jurisdiction, improper venue or failure
to join an indispensable party,*fn4 the order of dismissal
operates as an adjudication on the merits, unless otherwise
specified.*fn5 Judge Flood did not "otherwise specify," and
thus, by operation of Rule 273, a decision was rendered on the
merits, regardless of his failure to use the words "with
prejudice."*fn6 See Campbell v. Harrison, 16 Ill. App.3d 570,
306 N.E.2d 643 (1st Dist. 1973).
The second and more difficult question raised by defendants'
motion is whether matters not raised in the dismissed state
complaint also are barred by res judicata. The only material
differences between Harl's federal and state complaints is
that her federal action is brought pursuant to 42 U.S.C. § 1983
and includes allegations regarding certain hearing demands and
notice requirements. It is undisputed, however, that these new
claims arise out of the same set of operative facts that formed
the basis for Harl's state court action.
While it is clear that Harl could easily have raised the
notice and hearing claims, along with the numerous other due
process allegations raised in state court, it was unclear,
until recently, whether she could have raised her § 1983 claim
in the state court proceeding as well. In Martinez v.
California, 444 U.S. 277, 283 n. 7, 100 S.Ct. 553, 558 n. 7, 62
L.Ed.2d 481 (1980), however, the Supreme Court held that state
courts could exercise jurisdiction over § 1983 claims.*fn8
Because the Supreme Court has construed § 1983 to permit state
court jurisdiction and because the Illinois Appellate Court has
held that Illinois courts may hear such actions, see Bohacs v.
Reid, 63 Ill. App.3d 477, 20 Ill.Dec. 304, 379 N.E.2d 1372 (2d
Dist. 1978); Alberty v. Daniel, 25 Ill. App.3d 291,
323 N.E.2d 110 (1st Dist. 1974), it is apparent that Harl could have
raised her § 1983 claim, as well as her other factual
allegations, in her state court complaint.
It is well settled that a final judgment on the merits
precludes the parties or their privies from relitigating
issues that were or could have been raised in that action.
Allen v. McCurry, ___ U.S. ___, ___, 101 S.Ct. 411, 413, 66
L.Ed.2d 308 (1980); Cromwell v. County of Sac, 94 U.S. 351,
352, 24 L.Ed. 195 (1876); Lambert v. Conrad, 536 F.2d 1183,
1185 (7th Cir. 1976). It is unsettled, however, whether this
long-standing and broad based res judicata doctrine applies to
cases brought under § 1983. In a recent decision bearing
directly on this question, the Supreme Court held that the
rules of res judicata and collateral estoppel are generally
applicable to § 1983 actions. Allen v. McCurry, ___ U.S. ___,
101 S.Ct. 411, 66 L.Ed.2d 308. In so ...