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04/20/89 Phyllis C. Kinzer, A v. the City of Chicago Et Al.

April 20, 1989

BENEFIT OF THE CITY OF CHICAGO, APPELLEE

v.

THE CITY OF CHICAGO ET AL., APPELLANTS



SUPREME COURT OF ILLINOIS

PHYLLIS C. KINZER, a taxpayer on behalf of and for the

539 N.E.2d 1216, 128 Ill. 2d 437, 132 Ill. Dec. 410 1989.IL.553

Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. David J. Shields, Judge, presiding.

APPELLATE Judges:

CHIEF JUSTICE MORAN delivered the opinion of the court. WARD, CLARK and STAMOS, JJ., took no part in the consideration or decision of this case.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE MORAN

Plaintiff, Phyllis Kinzer, filed her verified fourth amended complaint in the circuit court of Cook County pursuant to section 1-5-1 of the Illinois Municipal Code (Code) (Ill. Rev. Stat. 1985, ch. 24, par. 1-5-1) seeking to obtain declaratory relief, injunctive relief and to recover damages on behalf of and for the benefit of the City of Chicago against defendants, the City of Chicago (City) and Daniel Grim (Grim) et al. The circuit court granted Grim's cross-motion for summary judgment and denied plaintiff's motion for summary judgment against both Grim and the City. Plaintiff appealed.

On appeal, the appellate court reversed, finding that: (1) the expenditures made by Grim without prior appropriation violated section 8-1-7 of the Code (Ill. Rev. Stat. 1985, ch. 24, par. 8-1-7); (2) Grim was not protected by the Local Governmental and Governmental Employees Tort Immunity Act (Tort Immunity Act) (Ill. Rev. Stat. 1985, ch. 85, par. 1-101 et seq.); (3) Grim would be held to a strict liability standard of care; and (4) the doctrine of res judicata was inapplicable in the present action. (169 Ill. App. 3d 447.) The case comes before this court on a certificate of importance issued by the appellate court (107 Ill. 2d R. 316).

The issues presented for review are: (1) whether the expenditures made by Grim without prior appropriation violated section 8-1-7 of the Code (Ill. Rev. Stat. 1985, ch. 24, par. 8-1-7); (2) if so, whether Grim is protected by the Tort Immunity Act (Ill. Rev. Stat. 1985, ch. 85, par. 1-101 et seq.); (3) if not, whether Grim should be held to a strict liability standard of care; and (4) whether the doctrine of res judicata bars the present action.

This case arises out of the conduct of several city officials who, without receiving prior appropriations from the city council, entered into contracts and incurred expenses relating to various special events which were held between 1978 and 1983. We summarize the facts which are pertinent to the present action.

In 1978, the City began sponsoring summer entertainment festivals known as "ChicagoFest." At that time, the City maintained the Municipal Hotel Operators Tax Fund (Fund 355) which was used to "promote tourism, conventions and other special events" pursuant to section 8-3-14 of the Code (Ill. Rev. Stat. 1977, ch. 24, par. 8-3-14). The city council annually approved use of the money in Fund 355 for the promotion of tourism, conventions and other special events.

That same year, Clark Burrus, then city comptroller, set up a new "Trust and Agency Fund" (Fund 666), as a separate part of Fund 355, to account for ChicagoFest receipts and expenditures. In order to finance the 1978 ChicagoFest, money was transferred from Fund 355 to the newly established Fund 666. Expenses from the 1978 ChicagoFest were charged to Fund 666. However, the 1978 ChicagoFest lost money and, consequently, Fund 666 showed a deficit which was charged to Fund 355.

In 1979, money from Fund 355 was again transferred to Fund 666 to finance the 1979 ChicagoFest. Expenses from the 1979 ChicagoFest were also charged to Fund 666. However, the 1979 ChicagoFest made a profit. These profits were not used to reimburse Fund 355, but remained in Fund 666. Later that year, Fund 666 was reclassified as the "ChicagoFest Special Revenue Fund" by Raymond Coyne, who succeeded Burrus as city comptroller.

On July 8, 1980, Grim succeeded Coyne as city comptroller. Prior to Grim's assumption of the comptroller's duties, the mayor's office of special events decided to sponsor additional special events, because of the popularity of ChicagoFest. On October 2, 1980, Grim executed a contract with Festivals, Inc., to manage a special event to be held in fall 1980. Grim followed the practice established by his predecessors and charged expenditures relating to the 1980 ChicagoFest, as well as ...


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