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11/01/94 RANDOLPH RATKOVICH v. DONALD A. HAMILTON

November 1, 1994

RANDOLPH RATKOVICH, PLAINTIFF-APPELLEE,
v.
DONALD A. HAMILTON, ZIMMER LEASING, INC., AND WINCHESTER TRANSPORTATION COMPANY, DEFENDANTS-APPELLEES. THE PEOPLE OF THE STATE OF ILLINOIS, EX REL. DEPARTMENT OF TRANSPORTATION, PLAINTIFF-INTERVENOR-APPELLANT, V. DONALD A. HAMILTON, ZIMMER LEASING, INC., AND WINCHESTER TRANSPORTATION COMPANY, DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Cook County. The Honorable Sidney A. Jones, III, Judge Presiding.

Released for Publication December 16, 1994.

DiVito, Hartman, McCormick

The opinion of the court was delivered by: Divito

Presiding Justice DiVito delivered the opinion of the court:

This case presents the question of whether a party who intervenes less than 60 days prior to an arbitration hearing is nonetheless entitled to receive the 60 days' notice of that hearing required by Supreme Court Rule 88. For reasons that follow we answer yes, and reverse and remand for a new arbitration hearing.

Plaintiff Randolph Ratkovich filed an amended complaint against defendants Donald Hamilton, Zimmer Leasing, Inc., and Winchester Transportation Co., Inc., on March 14, 1986. Ratkovich sought to recover for personal injuries suffered in a March 16, 1984 motor vehicle collision with a truck driven by Hamilton. He alleged that Hamilton was acting as the agent and servant of the other two defendants at the time of the accident.

On June 13, 1991, the People of the State of Illinois, ex rel. the Illinois Department of Transportation (the Department), filed a petition for leave to intervene and a proposed complaint in intervention. In the complaint, the Department alleged that Ratkovich was an employee of the Department at the time of the May 16, 1984 accident. The Department paid Ratkovich $21,789 in settlement of workers' compensation claims arising out of this accident and a prior accident on August 30, 1992. Of this amount, approximately $1,600 was intended as compensation for the earlier accident. The Department asserted a statutory lien under section 5 of the Workers' Compensation Act (820 ILCS 305/5 (West 1992)) upon any amounts recovered by Ratkovich in the suit. In the event he abandoned the action, the Department sought recovery from the defendants pursuant to the same statutory provision. The Department filed a duplicate petition for leave to intervene and complaint in intervention on July 16, 1991, and after a hearing its petition was granted on August 9, 1991.

The circuit court had previously placed the matter on the mandatory arbitration call on June 14, 1991. On July 22, 1991, after the Department had first petitioned to intervene but before its petition was granted, the arbitration administrator issued a notice to Ratkovich and all defendants (the only parties of record at the time), setting the matter for an arbitration hearing on September 26, 1991. The notice contained the statement: "Failure to appear shall constitute a waiver of the right to reject the award pursuant to Supreme Court Rule 91." The Department, not yet officially a party to the action, did not receive the notice.

On August 26, 1991, Ratkovich served upon all defendants and the Department a notice of his intent to offer certain documents into evidence at the arbitration hearing, pursuant to Supreme Court Rule 90 which requires at least 30 days' notice of such intent. The notice did not mention the date of the hearing.

The arbitration hearing was held as scheduled on September 26, 1991, and no attorney or other representative of the Department was present. At the hearing, Ratkovich and the defendants agreed to settle the case for $8,500. The panel of arbitrators entered an award in favor of Ratkovich in that amount on that day.

The Department filed a motion to vacate the arbitrators award on October 25, 1991. It asserted in the motion that the award should be vacated because the Department had not received notice of the arbitration hearing, and because the settlement between Ratkovich and the defendants was not valid without the written consent of the Department or a court order protecting the Department's interest, pursuant to the Workers' Compensation Act (820 ILCS 305/5(b) (West 1992)).

The circuit court denied the Department's motion and entered judgment on the arbitrators' award on June 22, 1992. In its order, the circuit court also directed Ratkovich to file within 14 days a motion to adjudicate the amount of the Department's lien. The order did not contain language prescribed by Supreme Court Rule 304(a) allowing immediate appeal. Ratkovich filed the motion on November 12, 1992. He argued in the motion that the Department was barred from asserting any lien interest because it had failed to appear at the arbitration hearing. The Department filed its response on January 12, 1993, asserting a lien of at least $15,904.84, and claiming the entire $8,500, less the statutory 25% for attorney fees (820 ILCS 305/5(b) (West 1992)), or a total of $6,375.

After hearing argument on the motion, the circuit court entered an order on February 2, 1993, in which it ruled that the Department had no interest in the proceeds of the $8,500 judgment that had been entered in favor of Ratkovich. On February 19, 1993, the Department filed a notice of ...


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