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Carmichael v. Union Pacific Railroad Co.

Supreme Court of Illinois

September 19, 2019

MARY TERRY CARMICHAEL, Appellant,
v.
UNION PACIFIC RAILROAD COMPANY et al. (Professional Transportation, Inc., Appellee) Jesse White, Secretary of State, Intervenor-Appellant.

          JUSTICE BURKE delivered the judgment of the court, with opinion. Chief Justice Karmeier and Justices Thomas, Kilbride, Garman, Theis, and Neville concurred in the judgment and opinion.

          OPINION

          BURKE, JUSTICE

         ¶ 1 The plaintiff in this case was injured in a motor vehicle accident caused by a third party while riding in an employee transport van owned by defendant Professional Transportation, Inc. (PTI). She filed a declaratory judgment action in the circuit court of Cook County seeking a declaration that defendant was legally responsible for her damages due to a statutory violation. Specifically, plaintiff alleged that defendant's vehicle insurance policy did not contain the minimum coverage required by section 8-101(c) of the Illinois Vehicle Code (625 ILCS 5/8-101(c) (West 2010)). In response, PTI filed affirmative defenses alleging that section 8-101(c) was unconstitutional. At the same time, PTI filed a counterclaim based on grounds identical to those alleged in its affirmative defenses. The trial court dismissed the counterclaim with prejudice. The appellate court affirmed the dismissal of the counterclaim, but on different grounds. 2018 IL App. (1st) 170075. We now hold that the counterclaim was not a proper counterclaim under Illinois law. Accordingly, we strike the counterclaim, vacate the lower courts' judgments, and remand the cause to the trial court for further proceedings consistent with this opinion.

         ¶ 2 BACKGROUND

         ¶ 3 In 2010, plaintiff, Mary Terry Carmichael, was an employee of Union Pacific Railroad Company (Union Pacific). Union Pacific contracted with PTI to transport its employees to and between job sites. On November 13, 2010, plaintiff was riding in one of PTI's vans in the course of her employment when the van collided with another vehicle, causing plaintiff severe injuries. The driver of the other vehicle, Dwayne Bell, carried an automobile insurance policy with liability coverage of $20,000 per person and $40,000 per accident, the minimum coverage required by Illinois law.

         ¶ 4 On September 15, 2011, plaintiff filed a complaint in the law division of the circuit court of Cook County against Union Pacific, PTI, and Bell. Plaintiff sought money damages for her injuries based on negligence and violations of the Federal Employers' Liability Act (45 U.S.C. §§ 51-60 (2006)). Subsequently, Union Pacific and PTI were dismissed from the case after it was determined that their conduct did not cause the accident. Plaintiff ultimately reached a settlement with Bell in the amount of $20,000, the maximum amount of his liability coverage.

         ¶ 5 On October 17, 2012, while her negligence action was pending, plaintiff filed a three-count complaint for declaratory judgment and other relief in the chancery division of the circuit court against PTI, Union Pacific, and ACE American Insurance Company (ACE). In count I, plaintiff alleged that PTI was legally responsible for her damages because it was in violation of section 8-101(c) of the Illinois Vehicle Code (625 ILCS 5/8-101(c) (West 2010)). The version of section 8-101(c) in effect at the time of the accident required "a contract carrier transporting employees in the course of their employment on a highway of this State in a vehicle designed to carry 15 or fewer passengers" to maintain uninsured and underinsured motor vehicle coverage "in a total amount of not less than $250,000 per passenger." Id. The statute required affected contract carriers to file proof of financial responsibility with the Secretary of State. Id. Pursuant to section 8-116 of the Vehicle Code, a contract carrier who failed to comply with section 8-101(c) was guilty of a Class A misdemeanor. Id. § 8-116.

         ¶ 6 Plaintiff alleged that PTI's liability policy did not meet the statutory minimum because its uninsured and underinsured motor vehicle coverage was limited to $20,000 per passenger and $40,000 per occurrence. She sought a judicial declaration that PTI was legally responsible for her damages sustained in the accident in excess of Bell's insurance policy limits, up to a maximum of $250,000. [1]

         ¶ 7 PTI initially filed an answer and affirmative defenses on April 23, 2013. On October 2, 2013, PTI filed its amended answer, five affirmative defenses, and counterclaim. The first four affirmative defenses alleged that sections 8-101(c) and 8-116 of the Vehicle Code were unconstitutional. First, PTI alleged that the statutes constitute prohibited special legislation, in violation of article IV, section 13, of the Illinois Constitution of 1970 (Ill. Const. 1970, art. IV, § 13).

         ¶ 8 Second, PTI alleged that the statutes violate the equal protection clauses in the state and federal constitutions (Ill. Const. 1970, art. I, § 2; U.S. Const., amend. XIV), on the grounds that "no other motor vehicle passenger carriers in Illinois are burdened with the unique requirement of maintaining such insurance, and there is no reasonable basis to impose such a requirement on PTI and others who are similarly situated."

         ¶ 9 Third, PTI alleged that the statutes violate the due process clauses in the state and federal constitutions (Ill. Const. 1970, art. I, § 2; U.S. Const., amend. XIV) because they "are unconstitutionally vague and uncertain *** in that the underinsured motorist insurance requirements contained therein make ambiguous references to vehicles designed to carry 'fifteen or fewer' passengers and impose ambiguous levels of insurance in a 'total amount' of 'not less than $250,000 per passenger.' "

         ¶ 10 Fourth, PTI alleged that the statutes "constitute an undue and unreasonable burden on interstate commerce," in violation of the commerce clause of the United States Constitution (U.S. Const., art. I, § 8, cl. 3), "in that contract motor carriers, such as PTI, which transport passengers in interstate commerce, could not know how much underinsured motorist coverage to obtain in advance of operating, *** and this and other burdens imposed by the statute would unreasonably burden PTI and other similarly situated contract carriers."

         ¶ 11 PTI's fifth affirmative defense alleged that section 8-101(c) does not provide any civil remedy for statutory violations. It alleged that the criminal penalty in section 8-116 is the sole enforcement mechanism for section 8-101(c) and, thus, plaintiff could not rely on the statute as grounds for filing a private cause of action.

         ¶ 12 Along with its amended answer and affirmative defenses, PTI filed a separate counterclaim seeking a declaratory judgment against plaintiff and the State of Illinois, by and through the Illinois Attorney General and the Illinois Secretary of State. The counterclaim restated the identical constitutional arguments alleged in PTI's first four affirmative defenses. The constitutional claims were the only legal grounds set forth in the counterclaim. In its prayer for relief, PTI asked that the trial court declare unconstitutional section 8-101(c) and section 8-116, to the extent it applies to section 8-101(c). PTI also requested "that [plaintiffs] declaratory judgment action be dismissed with prejudice as to PTI."

         ¶ 13 On December 3, 2013, then-Attorney General Lisa Madigan filed a motion to dismiss the counterclaim pursuant to sections 2-615 and 2-619 of the Code of Civil Procedure (735 ILCS 5/2-615, 2-619 (West 2010)). Attorney General Madigan argued that PTI's claims should be dismissed because it failed to follow the procedure set forth in Illinois Supreme Court Rule 19 (eff. Sept. 1, 2006). Under this rule, a party challenging the constitutionality of a statute must provide notice to the Attorney General in order to afford the appropriate state officer "the opportunity, but not the obligation, to intervene in the cause or proceeding for the purpose of defending" the statute. Ill. S.Ct. R. 19(c) (eff. Sept. 1, 2006). Here, PTI avoided this process by filing a declaratory judgment action directly against state officials. Thus, Attorney General Madigan argued that the counterclaim should be dismissed as procedurally improper.

         ¶ 14 Attorney General Madigan also argued that PTI's constitutional claims failed on the merits. Thus, the counterclaim should be dismissed with prejudice. Alternatively, she suggested that the court could avoid addressing the constitutional issues by resolving the case on nonconstitutional grounds, i.e., by holding that section 8-101(c) does not provide for a private cause of action.

         ¶ 15 In response, PTI argued that deciding the case on nonconstitutional grounds would not completely resolve its counterclaim, for the following reasons:

"This Court's declaration that 5/8-101(c) does not provide a civil remedy would not be binding in other civil cases brought by other plaintiffs against PTI under the statute. Moreover, such a finding would not fix PTI's rights regarding any criminal prosecution that might be conducted against PTI under the statute. Resolving PTI's counterclaim, which seeks a determination that the offending UM/UIM insurance obligation imposed by 5/8-101(c) is unconstitutional, is the only way to finally determine the rights of all of the parties to this case."

         ¶ 16 With leave of court, on May 16, 2014, PTI filed its third amended counterclaim naming Illinois Secretary of State Jesse White and plaintiff as the only counter defendants. On the same day, PTI filed a motion to dismiss count I of plaintiffs complaint, arguing that section 8-101(c) does not provide for an express or implied private right of action. PTI also argued that its vehicles did not fit the definition of ...


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