APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, SECOND DIVISION
517 N.E.2d 600, 164 Ill. App. 3d 589, 115 Ill. Dec. 189 1987.IL.1590
Appeal from the Circuit Court of Cook County; the Hon. Anthony J. Scotillo, Judge, presiding.
JUSTICE BILANDIC delivered the opinion of the court. SCARIANO, P.J., and HARTMAN, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE BILANDIC
On November 16, 1984, Edith R. Suslick, as executor of the estate of Alvin Suslick, deceased, filed this chancery complaint based on fraud and for an accounting. This complaint follows five previous complaints filed in Federal court, as well as the Illinois courts, arising from the same alleged misconduct. The action arose from the defendants' handling of stock option trades for the decedent from July 1975 to July 1976. Defendants moved to dismiss the November 16, 1984, complaint pursuant to section 2-619 of the Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, pars. 2-619(4), (5)) under the applicable statute of limitations (Ill. Rev. Stat. 1985, ch. 110, par. 13-205), and by the doctrine of res judicata. Defendants' motion was granted solely on the statute of limitations issue. Plaintiff now appeals that dismissal. The defendants have cross-appealed on the issue of res judicata.
Some of the pertinent facts alleged in plaintiff's complaint are that Alvin Suslick, during his lifetime, entered into a written agreement with the defendants dealing with stock option trades. The agreement, dated July 25, 1975, is incorporated into the pleading. The account was actively traded from its inception until July 31, 1976.
Alvin Suslick died on May 22, 1978. Plaintiff's complaint alleges that the defendants actively concealed their fraudulent actions from her husband, herself and her attorneys. She alleges that she first discovered the fraud on August 31, 1979.
On May 19, 1981, essentially the same case was refiled in the name of Edith P. Suslick, as executor, rather than in the name of herself and her children as heirs of Alvin Suslick. (Suslick v. Rothschild Securities Corp. (N.D. Ill.), 81 C 2796.) This action was also based upon defendants' alleged violation of the Federal securities laws. (Securities Act of 1933 sec. 17(a), 15 U.S.C. sec. 77q(a) (1982); Securities Exchange Act of 1934 sec. 10(b), 15 U.S.C. sec. 78j(b) (1982) (SEC Rule 10b -- 5).) Federal jurisdiction was invoked on this basis. Later, the pleadings were amended to add a count alleging common law fraud, a pendant State court action, as count II of the second amended complaint.
While this Federal securities and pendant State court action was pending and undetermined in the Federal court (81 C 2796), the plaintiff filed a concurrent common law fraud action in the circuit court of Cook County as an added precaution toward preserving her State claim. (82 CH 5319, circuit court of Cook County, Illinois.) Defendants moved to dismiss the Federal securities action asserting that it was time barred. Since there is no applicable Federal statute of limitations, the court applied the Illinois three-year statute of limitations. (Ill. Rev. Stat. 1977, ch. 121 1/2, par. 137.13.) On December 30, 1982, an order was entered dismissing plaintiff's Federal securities action based on the Illinois statute of limitations. Plaintiff appealed this dismissal order.
While the appeal was pending in the United States Court of Appeals for the Seventh Circuit, defendants moved to dismiss plaintiff's State court action. On December 15, 1983, the circuit court dismissed the State court action without prejudice, because the pendant State court action would not be finally determined in the Federal court until the Federal appeal was completed.
On August 16, 1984, the dismissal of plaintiff's Federal securities action was affirmed by the United States Court of Appeals. Suslick v. Rothschild Securities Corp. (7th Cir. 1984), 741 F.2d 1000.
On November 16, 1984, the present action was filed in the circuit court of Cook County. Defendants filed a motion to dismiss on the basis of res judicata and the five-year statute of limitations. (Ill. Rev. Stat. 1985, ch. 110, par. 13-205.) On June 17, 1986, the trial court granted the motion solely on the basis of the statute of limitations. After a denial of post-trial motions, plaintiff appealed the dismissal. Defendants have cross-appealed, again asserting that the action is also barred by res judicata.
The issues presented are whether the trial court correctly applied the five-year statute of limitations (Ill. Rev. Stat. 1985, ch. 110, par. 13-205) and ...