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09/08/89 Floyd Johnson, v. Hilton Hotel Corporation

September 8, 1989





546 N.E.2d 617, 190 Ill. App. 3d 197, 137 Ill. Dec. 672 1989.IL.1398

Appeal from the Circuit Court of Cook County; the Hon. Alan E. Morrill, Judge, presiding.


JUSTICE COCCIA delivered the opinion of the court. LORENZ, J., concurs. JUSTICE PINCHAM, Dissenting.


Plaintiff-appellant Floyd Johnson alleged in his unverified complaint that on March 2, 1983, he was injured while a patron of the Biloxi Hilton Hotel. Johnson stated that while arising from a chair located in the hotel lobby, his leg became entangled in an electrical lamp cord, which was located under the chair, causing him to trip and fall. In his effort to recoup money damages for his injuries, he brought this suit against the defendants, Hilton Hotel Corporation (Hilton Hotel), the Omicron Corporation, and the Biloxi Hilton Hotel. His complaint included three counts, each count dedicated to one of the three defendants. Johnson charged that each defendant individually owned, operated, and managed the hotel in question, and that the negligence of each was a proximate cause of his injuries.

The defendants Omicron and Biloxi Hilton thereafter filed special and limited appearances and motions seeking to quash service of summons for lack of personal jurisdiction. These motions were granted and Omicron and Biloxi Hilton were dismissed from the suit. Johnson has taken no appeal from those dismissals.

Hilton Hotel filed a motion to dismiss, pursuant to section 2-619 of the Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, par. 2-619). The trial court granted Hilton Hotel's motion and dismissed Johnson's complaint on the ground that, as a matter of law, Hilton Hotel owed no duty to Johnson. It is from this order of dismissal that he appeals.

We affirm the trial court's order, and in support thereof state our reasons below.

Hilton Hotel, in support of its motion to dismiss Johnson's complaint, filed a copy of the licensing agreement relating to the Biloxi Hotel property in question, together with the affidavit of Lloyd S. Farwell, senior vice-president for Hilton Hotel and a senior vice-president for Hilton Inns, Inc. (Hilton Inns). It is noteworthy that this agreement was neither mentioned in Johnson's complaint nor attached thereto.

Farwell attested to the fact that he was familiar with the license agreement between the Hilton Inns and the Biloxi Hotel Properties, and that under this agreement the Biloxi Hotel Properties had the full and exclusive right and duty to operate the franchise. He further averred that at no time did either the Hilton Hotel or the Hilton Inns undertake to supervise, maintain, or provide janitorial services or maintenance services at the Biloxi Hilton.

In addition to the affidavit of Farwell, Hilton Hotel submitted the affidavit of John Yemelos, general partner of the Biloxi Hotel Properties and president of Omicron, who attested to the fact that the Biloxi Hilton was owned by Biloxi Hotel Properties Partnership, and that the Biloxi Hilton was managed by Omicron.

In further support of its motion to dismiss, Hilton Hotel tendered its verified answers to plaintiff's written interrogatories. These answers establish the following facts. Hilton Hotel did not review the Biloxi Hilton's operations. Hilton Hotel did not inspect the Biloxi Hilton to see whether it met the standards and reputation of the Hilton Hotel system. Hilton Hotel had no maintenance or engineering service agreements with the Biloxi Hilton from August 1973 to the time the interrogatories were answered; nor did it furnish architectural, interior design, and decorating services to the Biloxi Hilton during that time period. Hilton Hotel did not receive license fees under the licensing agreement between Hilton Inns, as licensor, and the licensee, Yemco Management Corporation, dated August 20, 1973. Finally, Hilton Hotel did not have correspondence with the Biloxi Hilton.

Along with Farwell's affidavit, Hilton Hotels submitted a copy of the license and franchise agreement, which controlled the rights and duties of the parties thereto and the properties in question. The agreement established, and the record reflects, the following. The licensor was Hilton Inns, Inc., as distinguished from the Hilton Hotel Corporation. The licensee was YEMCO Management Corporation. The licensor (Hilton Inns) was a subsidiary of Hilton Hotel, a Delaware corporation. Hilton Hotel authorized the licensor, Hilton Inns, to grant licenses to selected, first-class, independently owned or leased hotel and inn properties for operation and to use the name Hilton as provided. The licensor, Hilton Inns, had specific duties under article 3 of the license and franchise agreement, which included reviewing the hotel's operations periodically; inspecting and having the right, from time to time, to inspect the hotel; defending the name "Hilton" against imitations or infringements by unauthorized hotels or inns; and at licensee's request, furnishing architectural, interior design, and decoration services. The licensee, YEMCO Management Corporation, had certain specific duties under article 5 of the aforementioned agreement, which included, inter alia, operating, furnishing, maintaining, and equipping the hotel and related facilities in a first-class manner; identifying itself as the owner and operator of the hotel under license from licensor in the use of the name and service mark "Hilton" and the stylized "H" service mark and in licensee's signs and advertising and promotional material; disclosing in all dealings with suppliers and persons, other than guests, that it was an independent entity, and that licensor had no liability for its debts, and to refrain from using the name "Hilton" or any name similar thereto in or as part of its corporate or firm name; and operating the hotel directly by licensee. Finally, it was agreed that the license would be governed by the law of the State of Illinois.

Johnson failed to file any affidavits in opposition to those submitted by Hilton Hotel. Rather, he elected to stand on his unverified complaint, along with certain documents produced during discovery.

Nonetheless, Johnson now seeks to support his argument in search of reversal by stating that this court should pierce the corporate veil separating Hilton Hotel from the Hilton Inns. Johnson argues that a piercing of the corporate veil, which he asserts is necessary to hold Hilton Hotel liable for the actions of its subsidiary Hilton Inns, includes certain factual determinations which are for the trier of fact; thus, a section 2 -- 619 dismissal is inappropriate. Johnson has, however, waived any claim that Hilton Hotel's liability can be predicated upon the theory of piercing the corporate veil, as he failed to raise this theory below in any form. Therefore, he cannot do so for the first time on appeal. See Miscevich v. Commonwealth Edison Co. (1982), 110 Ill. App. 3d 400, 404-05, 442 N.E.2d 338, 342.

Johnson next argues that defendant Hilton Hotel's contention that it lacked an ownership interest, and had no duty to control the premises on which the plaintiff was injured, is clearly a question of fact to be determined by a jury; therefore, section 2 -- 619 dismissal is inappropriate. Johnson, nevertheless, failed to demand trial by jury. Hilton Hotel did demand trial by jury, but Johnson concedes in his reply brief that he could not prevent Hilton Hotel from trying the case without a jury, given his failure to ...

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