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Austin Gardens, LLC v. City of Chicago Department of Administrative Hearings

Court of Appeals of Illinois, First District, Sixth Division

January 19, 2018

AUSTIN GARDENS, LLC, Plaintiff-Appellant,
v.
THE CITY OF CHICAGO DEPARTMENT OF ADMINISTRATIVE HEARINGS, Defendant-Appellee.

          Appeal from the Circuit Court of Cook County, No. 15-L-050060; the Hon. Joseph M. Sconza, Judge, presiding.

          Saul, Ewing, Arnstein & Lehr, LLP, of Chicago (Hal R. Morris, David C. Dunkin, and Michael J. Pollock, of counsel), for appellant.

          Edward N. Siskel, Corporation Counsel, of Chicago (Benna Ruth Solomon, Myriam Zreczny Kasper, and Suzanne M. Loose, Assistant Corporation Counsel, of counsel), for appellee.

          Edward N. Siskel, Corporation Counsel, of Chicago (Benna Ruth Solomon, Myriam Zreczny Kasper, and Suzanne M. Loose, Assistant Corporation Counsel, of counsel), for appellee.

          Panel JUSTICE CUNNINGHAM delivered the judgment of the court, with opinion. Justices Connors and Delort concurred in the judgment and opinion.

          OPINION

          CUNNINGHAM JUSTICE.

         ¶ 1 In this administrative review action, plaintiff-appellant Austin Gardens, LLC (Austin Gardens), appeals the decision of the City of Chicago Department of Administrative Hearings (DOAH) which denied Austin Gardens' motion to vacate a 2013 default judgment. For the following reasons, we conclude that the DOAH lacked jurisdiction to consider the motion.

         ¶ 2 BACKGROUND

         ¶ 3 This appeal stems from two separate actions brought by the City of Chicago (City) alleging building code violations at real property owned by Austin Gardens. In April 2005, the City initiated an action in the municipal division of the circuit court of Cook County (the circuit court action) alleging certain building code violations at Austin Gardens' property at 300 to 308 North Central Avenue in Chicago. The circuit court action remained pending until 2014.

         ¶ 4 Meanwhile, in May 2013, the City initiated a separate action in the DOAH (the DOAH action) by filing an administrative complaint alleging that a March 2013 inspection revealed 13 violations at two properties owned by Austin Gardens, including the same property that was the subject of the circuit court action. Certain of the building code ordinances that were cited in the administrative complaint were also the subject of alleged violations in the circuit court action. In addition to Austin Gardens, the administrative complaint named each of the company's individual members as respondents in the DOAH action.

         ¶ 5 Austin Gardens did not appear at subsequent hearing dates in the DOAH action on June 25, 2013, and August 27, 2013. As a result, on August 27, 2013, an administrative law judge (ALJ) entered a default order in favor of the City in the DOAH action (the default judgment) that specified $500 fines for each of 12 separate building violations, plus $40 in costs, for a total judgment of $6040. The default judgment, which was mailed to Austin Gardens on August 30, 2013, specified that "You have 21 days from the above mailing date to file a motion to set-aside (void) this default order for good cause with the [DOAH]."

         ¶ 6 Separately, in April 2014, the City and Austin Gardens entered into an "Agreed Order of Injunction and Judgment" (Agreed Order) resolving the circuit court action. Under the Agreed Order, Austin Gardens agreed to pay $2000 in full settlement of the allegations in that action. The Agreed Order provided that the matter was "dismissed by agreement of the parties" and that it was a final order. The Agreed Order contains no explicit reference to the DOAH action or the default judgment.

         ¶ 7 Austin Gardens subsequently discovered the existence of the default judgment. On December 5, 2014, Austin Gardens filed a "motion to set-aside" the default judgment (motion to vacate). That motion asserted that Austin Gardens had not appeared in the DOAH action because it "thought this case had been taken care of" due to the circuit court action.

         ¶ 8 On December 19, 2014, an ALJ of the DOAH held a hearing on Austin Gardens' motion to vacate. At the hearing, Austin Gardens argued that it was impermissible for the City to initiate the DOAH action in 2013, while the circuit court action was pending for building code violations at the same property. The ALJ rejected Austin Gardens' argument and declined to disturb the default judgment, to the extent it was entered against Austin Gardens. However, the ALJ independently concluded that the individual members of the company should not be held personally liable for the fines assessed against Austin Gardens and thus decided to "dismiss" the DOAH action with respect to those individuals. Accordingly, on December 19, 2014, the ALJ entered an order denying the motion to vacate that specified, "Default Judgment stands as to [Austin Gardens] LLC only. All other parties are dismissed."

         ¶ 9 On January 23, 2015, Austin Gardens filed a complaint in the circuit court of Cook County, pursuant to the Administrative Review Law (735 ILCS 5/3-101 et seq. (West 2014)) for administrative review of the ALJ's denial of the motion to vacate the 2013 default judgment. The complaint contended that the City's "filing of an administrative action alleging code violations while a simultaneous action also alleging ...


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