Richter v. Prairie Farms Dairy

Digitally signed by

Illinois Official Reports Reporter of Decisions

Reason: I attest to the

accuracy and integrity

of this document

Supreme Court Date: 2016.06.24

09:53:36 -05'00'

Richter v. Prairie Farms Dairy, Inc., 2016 IL 119518

Caption in Supreme MICHAEL RICHTER et al., Appellees, v. PRAIRIE FARMS

Court: DAIRY, INC., Appellant.

Docket No. 119518

Filed May 19, 2016

Decision Under Appeal from the Appellate Court for the Fourth District; heard in that

Review court on appeal from the Circuit Court of Macoupin County; the Hon.

Patrick Londrigan, Judge, presiding.

Judgment Affirmed and remanded.

Counsel on Donald K. Schoemaker and Andrew J. Tessman, of Greensfelder,

Appeal Hemker & Gale, P.C., of Swansea, for appellant.

Todd W. Sivia and Paul A. Marks, of Edwardsville, for appellees.

Ann C. Barron, of Heyl, Royster, Voelker & Allen, of Edwardsville,

for amicus curiae Illinois Association of Defense Trial Counsel.

Leslie J. Rosen, of Chicago, for amicus curiae Illinois Trial Lawyers

Association.

Justices JUSTICE FREEMAN delivered the judgment of the court, with

opinion.

Chief Justice Garman and Justices Thomas, Kilbride, Karmeier,

Burke, and Theis concurred in the judgment and opinion.

OPINION

¶1 Following a voluntary dismissal, plaintiffs, Michael Richter and Denise Richter, doing

business as Rich-Lane Farms, refiled their civil action against defendant, Prairie Farms Dairy,

Inc. The circuit court of Macoupin County dismissed the refiled action pursuant to section

2-619 of the Code of Civil Procedure on the grounds of res judicata and the statute of

limitations. 735 ILCS 5/2-619(a)(4), (a)(5) (West 2012). The appellate court reversed and

remanded for further proceedings. 2015 IL App (4th) 140613. This court allowed defendant’s

petition for leave to appeal. Ill. S. Ct. R. 315 (eff. Jan. 1, 2015). We now affirm the judgment of

the appellate court.

¶2 I. BACKGROUND

¶3 The pleadings alleged the following facts, which we accept as true in the context of a

dismissal pursuant to section 2-619. See Board of Managers of the Village Centre

Condominium Ass’n v. Wilmette Partners, 198 Ill. 2d 132, 134 (2001). Plaintiffs are partners in

the business of dairy farming. Defendant is an agricultural cooperative (see 805 ILCS 315/1

et seq. (West 2014)) in the business of producing and supplying dairy products. In August

1980, plaintiffs became members of defendant’s cooperative, paid $15 for shares of

defendant’s common stock, and entered into a “Milk Marketing Agreement” with defendant.

According to the agreement, plaintiffs would provide defendant with whole milk, which

defendant would market and sell.

¶4 In April 2005, plaintiffs temporarily ceased milk production. However, plaintiffs had

“hoped and expected to resume production within one year and [had] retained their stock of

heifers to enable them to do so.” At that time, defendant’s bylaws provided, in pertinent part, as

follows:

“Section 8. Termination of Stock Interest. Any common stockholder who ceases to be a

producer of agricultural products or who fails to patronize the association for one (1)

fiscal year or who violates any provision of the Articles of Incorporation, the Bylaws,

or a marketing agreement shall forfeit his right to own Common Stock in this

association when evidence of such fact has been presented to the Board of Directors

and upon passage of a resolution by the Board finding such to be the fact, immediately

thereupon all the rights of such common stockholder shall cease ***. Upon termination

of membership, the Board shall redeem the outstanding Common Stock of the

terminating member by payment to the member of the actual dollar consideration paid

by the member for such Common Stock.”

Defendant became aware that plaintiffs temporarily ceased milk production no later than April

30, 2005.

-2-

¶5 In an October 2005 letter, defendant notified plaintiffs that it had terminated their

agreement and plaintiffs’ membership in the cooperative. The letter contained two alternative

reasons for its actions: “You were no longer marketing milk as an active producer of Prairie

Farms, as set forth in the By-Laws, at the end of the fiscal year ending 9/30/05,” or “During the

current fiscal year, there was a change in the way your membership was recorded in our books

(name change, etc.).” Defendant tendered $15 to plaintiffs to redeem the shares of common

stock, but plaintiffs rejected the payment.

¶6 A. Richter I

¶7 In October 2006, plaintiffs filed a three-count complaint against defendant in the circuit

court of Madison County. Plaintiffs alleged that they sustained damages as a result of

defendant’s termination of their agreement and plaintiffs’ membership in the cooperative.

Count I sought shareholder remedies pursuant to section 12.56 of the Business Corporation

Act of 1983 (Business Corporation Act) (805 ILCS 5/12.56 (West 2006)). Based on

defendant’s alleged concealment, suppression, or omission of its interpretation of section 8 of

its bylaws, count II alleged a claim pursuant to the Illinois Consumer Fraud and Deceptive

Business Practices Act (Consumer Fraud Act) (815 ILCS 505/1 et seq. (West 2006)), and

count III alleged common-law fraud.

¶8 Defendant moved to dismiss the complaint, arguing that each count failed to state a claim

upon which relief may be granted. See 735 ILCS 5/2-615 (West 2006)). Defendant asked the

circuit court to “dismiss Counts I through III of the Complaint with prejudice as a matter of

law.”

¶9 On September 26, 2007, the circuit court ruled on defendant’s motion in a written order,

which stated in pertinent part:

“Defendant’s Motion to Dismiss as to Counts I, II, and III are heard and argued.

Defendant’s motion as to Count I is denied.

Defendant’s Motion to Dismiss as to Counts II and III are granted.

Plaintiff[s] given leave to file amended complaint within 30 days.

Defendant given leave to file response to amended complaint within 30 days after

plaintiff’s filing of the same.

Defendant to answer Count I within 30 day[s] of [today’s] order.”

On October 24, 2007, plaintiffs moved for an extension of time to file an amended complaint.

On November 28, 2007, the circuit court granted plaintiffs an extension of 120 days. However,

plaintiffs never filed an amended complaint. Instead, the case proceeded on plaintiffs’ sole

remaining claim for shareholder remedies pursuant to the Business Corporation Act as stated

in count I.

¶ 10 In June 2011, the circuit court allowed plaintiffs’ attorney to withdraw. The court stayed

discovery deadlines and granted plaintiffs a continuance to find new counsel. In November

2011, plaintiffs’ current attorney entered his appearance. Beginning in February 2012,

plaintiffs sought extensions of time to comply with discovery requests. On July 13, 2012, the

court granted plaintiffs 30 days to disclose additional experts. On August 13, 2012, plaintiffs

moved for a two-week extension to disclose expert witnesses. On September 7, 2012, the court

denied plaintiffs’ request for a continuance. Plaintiffs then moved to voluntarily dismiss their

-3-

lawsuit without prejudice, which the court granted pursuant to section 2-1009 of the Code of

Civil Procedure (735 ILCS 5/2-1009 (West 2012)).

¶ 11 B. Richter II

¶ 12 On September 6, 2013, plaintiffs filed their four-count complaint. Count I sought

shareholder remedies. Based on defendant’s alleged concealment, suppression, or omission of

its interpretation of section 8 of its bylaws, count II alleged misrepresentation, and count III

alleged common-law fraud. Count IV alleged that defendant’s directors or officers breached

their fiduciary duty owed to plaintiffs. In December 2013, the circuit court of Madison County

granted defendant’s motion to transfer venue to Macoupin County.

¶ 13 In February 2014, defendant filed a combined motion to dismiss Richter II with prejudice.

See 735 ILCS 5/2-619.1 (West 2012). Defendant contended, inter alia, that the doctrine of

res judicata barred plaintiffs’ claims in Richter II and, alternatively, that the five-year statute

of limitations (see 735 ILCS 5/13-205 (West 2012)) barred plaintiffs’ claims for

misrepresentation, fraud, and breach of fiduciary duty. In June 2014, following a hearing, the

circuit court of Macoupin County granted defendant’s motion to dismiss Richter II based on

res judicata and the statute of limitations. 735 ILCS 5/2-619(a)(4), (a)(5) (West 2012).

¶ 14 Plaintiffs appealed. The appellate court held that the doctrine of res judicata did not bar

plaintiffs from filing Richter II. The court recognized that one of the requirements for

res judicata to apply was a final judgment on the merits. 2015 IL App (4th) 140613, ¶ 23. The

court concluded that the circuit court’s order dismissing the fraud counts in Richter I was not a

final order. Id. ¶ 26. Thus, the doctrine of res judicata did not bar plaintiffs from refiling their

action. Id. ¶ 36. The appellate court also held that the five-year statute of limitations (735 ILCS

5/13-205 (West 2012)) did not bar Richter II. The court agreed with plaintiffs that the

limitations savings statute (735 ILCS 5/13-217 (West 1994)) permitted the refiled action. 2015

IL App (4th) 140613, ¶¶ 37-42. The appellate court reversed the dismissal and remanded the

case to the circuit court for further proceedings. Id. ¶ 46.

¶ 15 Defendant appeals to this court. We granted the Illinois Association of Defense Trial

Counsel leave to submit an amicus curiae brief in support of defendant. We also granted the

Illinois Trial Lawyers Association leave to submit an amicus curiae brief in support of

plaintiffs. Ill. S. Ct. R. 345 (eff. Sept. 20, 2010). Additional pertinent background will be

discussed in the context of our analysis of the issues.

¶ 16 II. ANALYSIS

¶ 17 Defendant contends that the appellate court erred in reversing the circuit court’s section

2-619 dismissal of Richter II. Defendant argues that Richter II was barred by (A) the doctrine

of res judicata, (B) the rule against claim-splitting, (C) the statute of limitations, and (D) the

equitable doctrine of laches.

¶ 18 A section 2-619 motion provides for the involuntary dismissal of a cause of action based on

certain defects or defenses. 735 ILCS 5/2-619 (West 2012). In ruling on the motion, the circuit

court must interpret all pleadings and supporting documents in the light most favorable to the

nonmoving party. Porter v. Decatur Memorial Hospital, 227 Ill. 2d 343, 352 (2008); Borowiec

v. Gateway 2000, Inc., 209 Ill. 2d 376, 383 (2004). A section 2-619 motion to dismiss presents

a question of law, which we review de novo. In re Estate of Boyar, 2013 IL 113655, ¶ 27;

-4-

Robinson v. Toyota Motor Credit Corp., 201 Ill. 2d 403, 411 (2002).

¶ 19 A. Res Judicata

¶ 20 Defendant contends that the circuit court correctly dismissed Richter II pursuant to section

2-619(a)(4) of the Code of Civil Procedure, which provides for dismissal where the action “is

barred by a prior judgment.” 735 ILCS 5/2-619(a)(4) (West 2012). This provision allows a

defendant to raise the affirmative defense of res judicata. Morris B. Chapman & Associates,

Ltd. v. Kitzman, 193 Ill. 2d 560, 565 (2000).

¶ 21 The doctrine of res judicata provides that a final judgment on the merits rendered by a

court of competent jurisdiction bars a subsequent action between the same parties or their

privies involving the same cause of action. The bar extends not only to what was actually

decided in the prior action, but also to those matters that could have been decided. Three

requirements must be satisfied for res judicata to apply: (1) a final judgment on the merits

rendered by a court of competent jurisdiction, (2) an identity of cause of action, and (3) an

identity of parties or their privies. Wilson v. Edward Hospital, 2012 IL 112898, ¶ 9; Hudson v.

City of Chicago, 228 Ill. 2d 462, 467 (2008); Rein v. David A. Noyes & Co., 172 Ill. 2d 325,

334-35 (1996). The underlying policy of res judicata is to promote judicial economy by

preventing repetitive litigation and to protect a defendant from the harassment of relitigating

essentially the same claim. See Hayashi v. Illinois Department of Financial & Professional

Regulation, 2014 IL 116023, ¶ 45 (quoting Arvia v. Madigan, 209 Ill. 2d 520, 533 (2004)).

¶ 22 The requirement of a final order or judgment is a “critical” component in showing the

applicability of res judicata. Hernandez v. Pritikin, 2012 IL 113054, ¶ 41. A judgment cannot

bar a subsequent action unless it is a “final” judgment. Relph v. Board of Education of DePue

Unit School District No. 103, 84 Ill. 2d 436, 441 (1981); People ex rel. Scott v. Chicago Park

District, 66 Ill. 2d 65, 69 (1976). The party invoking res judicata carries the burden of

establishing its applicability. Hernandez, 2012 IL 113054, ¶ 41; Chicago Historical Society v.

Paschen, 9 Ill. 2d 378, 382 (1956).

¶ 23 The parties agree that the second and third elements of res judicata have been satisfied.

However, the appellate court concluded that the circuit court’s September 2007 dismissal order

in Richter I was not a final order, and, consequently, the bar of res judicata did not apply. 2015

IL App (4th) 140613, ¶¶ 26, 36. Before this court, defendant assigns error to this conclusion.

Defendant asserts that the dismissal of plaintiffs’ Consumer Fraud Act and common-law fraud

claims in Richter I “became a final order on the merits” when plaintiffs did not amend the

complaint, or seek appeal of that dismissal, but rather voluntarily dismissed the action.

¶ 24 To be “final,” a judgment or order must terminate the litigation and fix absolutely the

parties’ rights, leaving only enforcement of the judgment. In re Detention of Hardin, 238 Ill.

2d 33, 42-43 (2010); Village of Niles v. Szczesny, 13 Ill. 2d 45, 48 (1958). In determining when

a judgment or order is final, one should look to its substance rather than its form. In re J.N., 91

Ill. 2d 122, 128 (1982). Illinois Supreme Court Rule 273 provides: “Unless the order of

dismissal or a statute of this State otherwise specifies, an involuntary dismissal of an action,

other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join an

indispensable party, operates as an adjudication upon the merits.” (Emphasis added.) Ill. S. Ct.

R. 273 (eff. Jan. 1, 1967). If a circuit court involuntarily dismisses a plaintiff’s action, other

than for one of the rule’s three exceptions, and if the plaintiff does not procure leave of court to

-5-

refile the complaint or if a statute does not guarantee that opportunity, then Rule 273 deems the

dismissal to be on the merits. DeLuna v. Treister, 185 Ill. 2d 565, 575 (1999). However, a

dismissal “without prejudice” signals that there was no final decision on the merits and that the

plaintiff is not barred from refiling the action. See DeLuna, 185 Ill. 2d at 576; People ex rel.

Redd v. Mulholland, 134 Ill. App. 3d 929, 930-31 (1985).

¶ 25 The Code of Civil Procedure provides that the circuit court may allow amendments to

pleadings “[a]t any time before final judgment.” 735 ILCS 5/2-616(a) (West 2012). A

dismissal order that grants leave to amend is interlocutory and not final. Palm v. 2800 Lake

Shore Drive Condominium Ass’n, 2013 IL 110505, ¶ 21; Old Salem Chautauqua Ass’n v.

Illinois District Council of the Assembly of God, 13 Ill. 2d 258, 262 (1958) (stating that order

partially striking pleading and granting leave to amend is not final); see Hicks v. Weaver, 255

Ill. App. 3d 650, 652 (1994). An order that dismisses the counts of a complaint, but grants the

plaintiff leave to amend, is not “final” because the order does not terminate the litigation

between the parties. March v. Miller-Jesser, Inc., 202 Ill. App. 3d 148, 158-59 (1990); Gray v.

Starkey, 41 Ill. App. 3d 555, 558 (1976). A dismissal with leave to amend is consequently

without prejudice. See Dewan v. Ford Motor Co., 343 Ill. App. 3d 1062, 1070 (2003); Perkins

v. Collette, 179 Ill. App. 3d 852, 854 (1989); Redd, 134 Ill. App. 3d at 930-31. Accordingly, for

purposes of Rule 273, where a dismissal order does not specify that it is “without prejudice,” or

that plaintiff was granted leave to file an amended complaint, the dismissal order is a final

adjudication on the merits. See Kostecki v. Dominick’s Finer Foods, Inc., of Illinois, 361 Ill.

App. 3d 362, 373 (2005) (collecting cases).

¶ 26 In Richter I, defendant moved to dismiss the complaint based on insufficient facts alleged

in each count. The involuntary dismissal order expressly granted plaintiffs leave to file an

amended complaint within 30 days. Hence, there was no “adjudication upon the merits” in

Richter I because “the order of dismissal *** otherwise specifie[d]” that plaintiffs had leave to

file an amended complaint. Ill. S. Ct. R. 273. See Hernandez, 2012 IL 113054, ¶ 47; Stutzke v.

Edwards, 58 Ill. App. 3d 832, 834-35 (1978).

¶ 27 Defendant distinguishes an involuntary dismissal order that grants leave to amend from an

involuntary dismissal order that grants leave to amend within a time period. In its brief,

defendant argues: “If the leave period ‘otherwise specifie[d]’ by the court expires and no

action is taken by the plaintiff, Rule 273 operates to default the involuntary dismissal order to

an ‘adjudication on the merits.’ ” We observe that during oral argument, defendant argued that

a plaintiff is responsible for the consequences of failing to amend within a prescribed time

period because the order is directed to the plaintiff. Indeed, defendant asserted that there was

no rule even allowing a defendant to move for a final dismissal order where a dismissal order

has a leave-to-amend time period and the plaintiff fails to timely amend. We cannot agree.

¶ 28 Defendant attempts to create an “automatic final judgment” mechanism that would absolve

it of any responsibility for this prolonged litigation. However, defendant’s argument overlooks

a significant body of case law. Initially, this court has repeatedly recognized the inherent

power of the circuit court to review, modify, or vacate interlocutory orders while the court

retains jurisdiction over the entire controversy. Hernandez, 2012 IL 113054, ¶ 42 (collecting

cases); Catlett v. Novak, 116 Ill. 2d 63, 68 (1987) (collecting cases). Accordingly, where, as in

this case, the circuit court dismisses a complaint, and specifies a number of days for filing an

amended complaint, the court retains jurisdiction to allow the amended complaint to be filed

-6-

even after the time period has expired. Richardson v. Economy Fire & Casualty Co., 109 Ill. 2d

41, 46 (1985) (collecting cases); Miller v. Suburban Medical Center at Hoffman Estates, Inc.,

184 Ill. App. 3d 545, 547 (1989) (collecting cases). By failing to ask for leave to amend after

the circuit court enters an order dismissing a complaint, a plaintiff elects to stand on the

complaint and a subsequent order dismissing the suit may be entered. Doner v. Phoenix Joint

Stock Land Bank of Kansas City, 381 Ill. 106, 108-09 (1942). Even if a plaintiff subsequently

elects to stand on his or her complaint, an order striking or dismissing a complaint is not final

until a subsequent order finally dismisses the action or suit. See Boatmen’s National Bank of

Belleville v. Direct Lines, Inc., 167 Ill. 2d 88, 99 (1995) (collecting cases); Cole v.

Hoogendoorn, Talbot, Davids, Godfrey & Milligan, 325 Ill. App. 3d 1152, 1153-54, 1156

(2001); Miller, 184 Ill. App. 3d at 547 (collecting cases); Martin v. Marks, 80 Ill. App. 3d 915,

919 (1980).

¶ 29 However, defendant relies on this court’s decision in Smith v. Central Illinois Regional

Airport, 207 Ill. 2d 578 (2003), in support of its “automatic final judgment” mechanism. In

Smith, the dismissal order granted the plaintiff 60 days to amend the complaint. The plaintiff

did not amend but instead filed a motion for a voluntary dismissal (735 ILCS 5/2-1009 (West

2012)) within the 60-day period. Smith, 207 Ill. 2d at 588-89. This court held that the circuit

court should have allowed the plaintiff’s voluntary dismissal because it was within the time

period granted for leave to amend. In analyzing the nature and effect of the dismissal order, this

court stated:

“He [plaintiff] also could have elected, as he did here, to voluntarily dismiss the count

because the upshot of the court’s February 27 order was that the granting of

defendants’ section 2-615 motion would be considered to be with prejudice only after

the expiration of the 60-day period.” (Emphases in original and added.) Id. at 588.

In the case at bar, defendant focuses on the italicized sentence fragment to argue: “Smith

specifically directs that an involuntary dismissal order becomes a final adjudication on the

merits after the expiration of the temporary leave period.”

¶ 30 We do not read our opinion in Smith so broadly. Courts caution that “ ‘general language in

an opinion must not be ripped from its context to make a rule far broader than the factual

circumstances which called forth the language.’ [Citation.]” Rosewood Care Center, Inc. v.

Caterpillar, Inc., 226 Ill. 2d 559, 572 (2007). Rather, the Smith opinion, “like all others, must

be read in the context of the specific problem that was before the court.” Touhy v. State Board

of Elections, 62 Ill. 2d 303, 310 (1976); see Spring Hill Cemetery of Danville, Illinois v. Ryan,

20 Ill. 2d 608, 619 (1960) (cautioning that a judicial opinion “must be read as applicable only

to the facts involved and is an authority only for what is actually decided”). “In construing the

language of this court, as in construing any other language, it is necessary to examine the

context to find the connection in which the language is used and to ascertain what was intended

by such language.” Hoffman v. Hoffman, 330 Ill. 413, 420 (1928).

¶ 31 To the end of construing our Smith decision in context, we quote at length therefrom:

“In the present case, it is true that defendants challenged the sufficiency of count III

by way of a section 2-615 motion on December 29, 2000, and that the circuit court

heard the motion prior to plaintiff’s filing of his motion to voluntarily dismiss. The

court had, in fact, ruled in defendants’ favor by dismissing count III. Contrary to

defendants’ claims, however, that ruling did not have the effect of a final disposition of

-7-

the case because the court made the dismissal without prejudice and gave plaintiff 60

days in which to file an amendment. As we have explained, the order of February 27

was not a final order. An order striking or dismissing a complaint is not final until the

circuit court enters an order dismissing the suit. [Citations.] We must stress that no such

order was entered in this case. Moreover, the circuit court made clear that no such order

would be entertained until at least after the passage of 60 days. For all we know, the

circuit court might even have allowed plaintiff more time to amend had plaintiff sought

leave to do so. We stress, as the United States Supreme Court in [Jung v. K. & D.

Mining Co., 356 U.S. 335, 336-37 (1958)] stressed under similar facts, that the circuit

court’s order did not direct that the requested relief be denied but, rather, left the suit

pending for further proceedings.

“In our view, because the order of February 27 expressly left the suit pending for

further proceedings, the order not only allowed plaintiff the opportunity to amend, but

also allowed plaintiff to pursue other options available to him during this 60-day time

frame besides filing the amendment. Plaintiff could have chosen to stand on his

complaint and sought an order dismissing the complaint with prejudice, as a means of

obtaining a final, appealable judgment. [Citations.] He also could have elected, as he

did here, to voluntarily dismiss the count because the upshot of the court’s February 27

order was that the granting of defendants’ section 2—615 motion would be considered

to be with prejudice only after the expiration of the 60-day period. Under these

circumstances, the circuit court should have allowed plaintiff to seek a voluntary

dismissal up until the expiration of the 60-day period to amend. In its order, entered on

May 2, the circuit court stated that plaintiff failed to act within the 60-day time period.

Clearly this was error. We note that plaintiff’s motion to voluntarily dismiss was filed

on April 12, 2001, on day 48 of the 60-day time period set forth in the February 27

order. The circuit court erred in its calculation that the 60-day period had passed

without any action on plaintiff’s part. This is not the case where the plaintiff waited

until the sixty-first day to seek voluntary dismissal. Because plaintiff acted within the

period of time left open for amendment, we believe his right to a voluntary dismissal

was intact.” (Emphasis in original.) Smith, 207 Ill. 2d at 587-89.

¶ 32 When read in context, Smith did not hold that an involuntary dismissal order automatically

becomes a final adjudication on the merits after a leave-to-amend time period expires. The

plaintiff in Smith filed a motion for voluntary dismissal within the 60-day leave-to-amend time

period. Smith expressly recognized that the circuit court retained jurisdiction to allow the

plaintiff more time to amend had he sought leave and that the dismissal order was not final and

would not be final until the circuit court entered a separate order dismissing the action or suit.

Id. at 587-88. In Smith, this court specifically concluded that the plaintiff’s right to a voluntary

dismissal was intact because he acted within the leave-to-amend time period. Id. at 589.

¶ 33 Although the Smith court conjectured that the dismissal order in that case would have been

considered to be with prejudice only after the leave-to-amend period expired, that speculation

was unnecessary to the court’s actual conclusion. This court did not know how that litigation

would have proceeded after the leave-to-amend period expired. Id. at 588 (“For all we know,

the circuit court might even have allowed plaintiff more time to amend had plaintiff sought

leave to do so.”). In context, this court was merely attempting to emphasize the security of

plaintiff’s position within the 60-day period. This court did not intend to overrule a significant

-8-

body of case law by this single sentence. “We resist reading a single sentence unnecessary to

the decision as having done so much work.” Arkansas Game & Fish Comm’n v. United States,

568 U.S. ___, ___, 133 S. Ct. 511, 520 (2012).

¶ 34 Defendant complains that the above-cited case law provides “no consequences for a

plaintiff’s failure to act within the temporary leave period. *** Accordingly, there would never

be a need to dismiss a claim or complaint with temporary leave to amend because the plaintiff

would never be compelled to take any action within the temporary leave period.”

¶ 35 However, this argument overlooks that the circuit court may impose whatever

“consequences” that defendant would seek in a proper motion. The circuit court retains broad

discretion in allowing or denying amendment to pleadings prior to the entry of final judgment,

and a reviewing court will not reverse the trial court’s decision absent a manifest abuse of such

discretion. Loyola Academy v. S&S Roof Maintenance, Inc., 146 Ill. 2d 263, 273-74 (1992)

(collecting cases). Further, the Code of Civil Procedure provides that a circuit court may allow

amendments to pleadings “on just and reasonable terms.” 735 ILCS 5/2-616(a) (West 2010).

Such “just and reasonable terms” may include the enforcement of a time limitation within

which the amended pleading must be filed. See, e.g., Nicholson v. Chicago Bar Ass’n, 233 Ill.

App. 3d 1040, 1045 (1992); Shroat v. Robins, 7 Ill. App. 3d 293, 295 (1972). Conversely, the

court may permit amendment long after the time period expires. Richardson, 109 Ill. 2d at 46.

This rule supports the circuit court’s sound exercise of its discretion. “A contrary course would

amount to a substitution of the judgment of the reviewing court in place of that of the trial court

in which such discretion properly resides.” Nicholson, 233 Ill. App. 3d at 1045. See, e.g.,

Bosch Die Casting Co. v. Biallas, 269 Ill. App. 3d 377 (1995) (granting leave to file second

amended complaint 25 days after court-imposed deadline, but denying leave to file third

amended complaint 71 days after court-imposed deadline). We conclude that the involuntary

dismissal order in Richter I did not automatically become a final order when plaintiffs failed to

file an amended complaint within the leave-to-amend period.

¶ 36 In the case at bar, defendant moved to dismiss Richter I and Richter II each with prejudice.

Defendant, therefore, knew the legal significance of such a dismissal order. Although nearly

five years elapsed between the time plaintiffs were granted leave to file an amended complaint

and their voluntary dismissal, defendant did not seek a final order dismissing Richter I with

prejudice, definitively ending the action. “[A] party claiming res judicata—as the party

bearing the burden of showing that res judicata applies—has a duty to clarify the record so as

to clearly demonstrate his entitlement to the doctrine’s application.” (Emphasis in original.)

Hernandez, 2012 IL 113054, ¶ 52. We conclude that defendant has failed to carry this burden.

¶ 37 B. Claim Splitting

¶ 38 Defendant next contends that the dismissal order in Richter I became a final judgment

when the court granted plaintiffs’ motion to voluntarily dismiss the sole remaining shareholder

remedies claim. Therefore, according to defendant, plaintiffs engaged in improper claim

splitting by “refiling the entirety of Richter I, including claims that Plaintiffs elected to

abandon five years prior, as a new action in Richter II.” Alternatively, defendant argues that

plaintiff had a “limited” right to refile only the shareholder remedies claim alleged in count I of

Richter I.

-9-

¶ 39 We cannot accept this contention. The circuit court granted plaintiffs’ motion for a

voluntary dismissal of Richter I pursuant to section 2-1009 of the Code of Civil Procedure (735

ILCS 5/2-1009 (West 2010)). A voluntary dismissal pursuant to section 2-1009 terminates the

entire action and renders immediately appealable all final orders entered therein that were not

previously appealable. Hudson, 228 Ill. 2d at 468; Dubina v. Mesirow Realty Development,

Inc., 178 Ill. 2d 496, 503 (1997). However, this court’s decisions in Rein and Hudson explained

that res judicata prohibits a litigant from using section 2-1009 to split claims into multiple

actions or suits. Hudson, 228 Ill. 2d at 471-72; Rein, 172 Ill. 2d at 339. In Rein, this court

cautioned that a plaintiff’s statutory right to a voluntary dismissal within the limitations period

(735 ILCS 5/13-217 (West 2010)) does not “automatically immunize a plaintiff against the bar

of res judicata or other legitimate defenses a defendant may assert in response to the refiling of

voluntarily dismissed counts.” Rein, 172 Ill. 2d at 342-43. In Hudson, this court explained:

“Rein thus stands for the proposition that a plaintiff who splits his claims by voluntarily

dismissing and refiling part of an action after a final judgment has been entered on another

part of the case subjects himself to a res judicata defense.” (Emphasis added.) Hudson, 228 Ill.

2d at 473.

¶ 40 Rein and Hudson are clearly distinguishable from the instant case. Here, the circuit court

never entered an order dismissing the action in Richter I, or any other order that could be

deemed final. A nonfinal order cannot bar a subsequent action. Relph, 84 Ill. 2d at 441.

Because Richter I was dismissed with leave to file an amended complaint, there was no final

adjudication on the merits of any of those three claims. Further, a voluntary dismissal pursuant

to section 2-1009(a) is, by its express terms, without prejudice. 735 ILCS 5/2-1009(a) (West

2010). Of course, it was within the discretion of the circuit court in Richter I to entertain a

defense motion for a final order dismissing the cause of action prior to ruling on plaintiffs’

motion for voluntary dismissal. See Morrison v. Wagner, 191 Ill. 2d 162, 165 (2000).

However, defendant did not raise such a motion. Without a final adjudication on the merits, the

claim-splitting issues addressed in Rein and Hudson are not presented here, and res judicata is

not applicable. See Piagentini v. Ford Motor Co., 387 Ill. App. 3d 887, 893-95 (2009). Hence,

the circuit court’s nonfinal ruling in Richter I had no effect on Richter II. See Wilson, 2012 IL

112898, ¶ 26; Hernandez, 2012 IL 113054, ¶ 54; People ex rel. Williams v. Board of

Education of Pawnee Township High School, 350 Ill. 597, 601 (1932).

¶ 41 C. Statute of Limitations

¶ 42 Defendant alternatively contends that the circuit court correctly dismissed Richter II

pursuant to section 2-619(a)(5) of the Code of Civil Procedure, which provides for dismissal

where the action “was not commenced within the time limited by law.” 735 ILCS

5/2-619(a)(5) (West 2012). This provision allows a defendant to raise a statute of limitations

defense in a motion to dismiss. See Hermitage Corp. v. Contractors Adjustment Co., 166 Ill.

2d 72, 84 (1995).

¶ 43 The complaint in Richter II contained four counts. Plaintiffs sought shareholder remedies

(count I), alleged misrepresentation (count II), alleged common-law fraud (count III), and

alleged that defendant’s directors or officers breached their fiduciary duty owed to plaintiffs

(count IV). It is undisputed that the cause of action in Richter II accrued in October 2005 when

defendant terminated the milk marketing agreement and plaintiffs’ membership in the

- 10 -

cooperative and that plaintiffs filed the complaint in Richter II on September 6, 2013.

Defendant contends that plaintiffs’ claims for misrepresentation, fraud, and breach of fiduciary

duty were not commenced within the applicable five-year statute of limitations (735 ILCS

5/13-205 (West 2012)) and, therefore, are time-barred. In response, plaintiffs contend that

section 13-217 of the Code of Civil Procedure (735 ILCS 5/13-217 (West 2012)) saves these

claims.

¶ 44 Section 13-217 provides in pertinent part that if the plaintiff voluntarily dismisses a cause

of action, “then, whether or not the time limitation for bringing such action expires during the

pendency of such action, the plaintiff *** may commence a new action within one year or

within the remaining period of limitation, whichever is greater *** after the action is

voluntarily dismissed by the plaintiff.” 735 ILCS 5/13-217 (West 1994).1 Section 13-217

operates as a limitations savings statute, with the purpose of facilitating the disposition of

litigation on the merits and avoiding its frustration upon grounds unrelated to its merits. Case

v. Galesburg Cottage Hospital, 227 Ill. 2d 207, 215 (2007); Gendek v. Jehangir, 119 Ill. 2d

338, 343 (1988).

¶ 45 Although the cause of action in Richter II accrued in October 2005, plaintiffs filed Richter

I in October 2006, well within the applicable five-year limitations period. Further, after

plaintiffs voluntarily dismissed Richter I on September 7, 2012, section 13-217 conferred on

plaintiffs the right to refile within one year even if the statute of limitations had expired. As the

appellate court correctly reasoned, plaintiffs, therefore, had until September 7, 2013, to refile

their action. Accordingly, when plaintiffs refiled their action on September 6, 2013, the

limitations savings period had not yet expired. 2015 IL App (4th) 140613, ¶ 41.

¶ 46 However, defendant contends that section 13-217 is not available to plaintiffs. Defendant

argues that Richter I was not terminated by plaintiffs’ voluntary dismissal, which section

13-217 covers, but rather was terminated by the September 2007 involuntary dismissal order

with leave to amend. This argument is premised on defendant’s position that the Richter I

dismissal order with leave to amend automatically defaulted to an adjudication on the merits.

We reject this argument as we earlier rejected its premise. We deem plaintiffs’ September 2012

voluntary dismissal to be the effective order finally terminating Richter I. See Apollo Real

Estate Investment Fund, IV, L.P. v. Gelber, 398 Ill. App. 3d 773, 785-86 (2009).

¶ 47 Defendant also repeats its contention before the appellate court that plaintiffs may not raise

new claims in a refiled action. Defendant argues that plaintiffs’ common-law fraud claim in

Richter II is improper because the only claim that was pending at the time of the voluntary

dismissal in Richter I was count I for shareholder remedies. Thus, reasons defendant, “Count I

of Richter I is the only claim that might conceivably be saved.”

¶ 48 The appellate court correctly rejected this argument. 2015 IL App (4th) 140613, ¶ 42. A

refiled action pursuant to section 13-217 is not a restatement of the old action, but an entirely

new and separate action. Dubina, 178 Ill. 2d at 504. Further, a cause of action may contain

several theories of recovery (Wilson, 2012 IL 112898, ¶ 25 (collecting cases)) arising from a

single group of operating facts. Hayashi, 2014 IL 116023, ¶ 46. Here, plaintiffs’ claims in

1

This version of section 13-217 is currently in effect because it preceded the amendments of Public

Act 89-7, § 15 (eff. Mar. 9, 1995), which this court found unconstitutional in its entirety in Best v.

Taylor Machine Works, 179 Ill. 2d 367 (1997). See Hudson, 228 Ill. 2d at 469 n.1.

- 11 -

Richter II for misrepresentation, fraud, and breach of fiduciary duty all grew out of the same

transaction alleged in Richter I.

¶ 49 D. Laches

¶ 50 Defendant lastly contends that the doctrine of laches bars Richter II. Section 2-619(a)(9) of

the Code of Civil Procedure provides for dismissal where the claim “is barred by other

affirmative matter avoiding the legal effect of or defeating the claim.” 735 ILCS 5/2-619(a)(9)

(West 2012). One such affirmative matter is the defense of laches. See Mo v. Hergan, 2012 IL

App (1st) 113179, ¶ 34; Summers v. Village of Durand, 267 Ill. App. 3d 767, 771 (1994).

¶ 51 “ ‘Laches is an equitable principle which bars recovery by a litigant whose unreasonable

delay in bringing an action for relief prejudices the rights of the other party.’ ” First National

Bank of Springfield v. Malpractice Research, Inc., 179 Ill. 2d 353, 364 (1997) (quoting People

ex rel. Daley v. Strayhorn, 121 Ill. 2d 470, 482 (1988)). However, unlike a statute of

limitations, “laches is not a mere matter of time but principally a question of the inequity of

permitting the claim to be enforced,—an inequity founded upon some change in the condition

or relation of the property and the parties.” Holland v. Richards, 4 Ill. 2d 570, 578 (1955). In

other words, “it must appear that a plaintiff’s unreasonable delay in asserting his rights has

prejudiced and misled the defendant, or caused him to pursue a course different from what he

would have otherwise taken. [Citations.] If the defendant is not injured by the delay, then

plaintiff is not guilty of laches.” People ex rel. Casey v. Health & Hospitals Governing

Comm’n, 69 Ill. 2d 108, 115 (1977). The applicability of laches to a given case lies within the

discretion of the circuit court. Finley v. Finley, 81 Ill. 2d 317, 330 (1980); Evans v.

Woodsworth, 213 Ill. 404, 409 (1904).

¶ 52 Here, the circuit court granted defendant’s section 2-619 motion to dismiss Richter II

expressly on the grounds of res judicata and the statute of limitations. The court did not rule on

the issue of laches, and, consequently, the appellate court declined to address this issue. 2015

IL App (4th) 140613, ¶ 43. We agree and do likewise. On remand, defendant is free to assert a

laches defense. The circuit court is in the best position to make the relevant factual findings

based on the totality of the circumstances of this particular case. See, e.g., Hurlbert v. Charles,

238 Ill. 2d 248, 261 (2010); Morel v. Coronet Insurance Co., 117 Ill. 2d 18, 27-28 (1987).

¶ 53 III. CONCLUSION

¶ 54 For the foregoing reasons, the judgment of the appellate court is affirmed, and the cause

remanded to the circuit court of Macoupin County for further proceedings.

¶ 55 Affirmed and remanded.

- 12 -