Mohanty v. St. John Heart Clinic, S.C.

JUSTICE KARMEIER, specially concurring:

I fully concur in the court’s judgment. I join its opinion with the understanding that it should not be read as altering any of the normal standards governing cases of this kind.

As the appellate court recognized, this is an interlocutory appeal as of right brought pursuant to Supreme Court Rule 307(a)(1) (188 Ill. 2d R. 307(a)(1)) from a judgment of the circuit court denying defendants’ motion for a preliminary injunction. It is well established that the purpose of a preliminary injunction is not to resolve the merits of a case, but to preserve the status quo until the merits can be decided. Callis, Papa, Jackstadt & Halloran, P.C. v. Norfolk & Western Ry. Co., 195 Ill. 2d 356, 365 (2001). Consistent with the provisional nature of this remedy, a party seeking preliminary injunctive relief is not required to make out a case which would entitle him to final judgment; rather, he need only show that he raises a “fair question” and that the court should preserve the status quo until it can decide the case on the merits. Buzz Barton & Associates, Inc. v. Giannone, 108 Ill. 2d 373, 382 (1985).

The issuance of a preliminary injunction is an extreme remedy and should not be undertaken unless an emergency exists and serious harm would result if the injunction were not issued. As my colleagues indicate, the party seeking a preliminary injunction must establish that (1) a clearly ascertained right in need of protection exists, (2) irreparable harm will occur in the absence of an injunction, (3) there is not an adequate remedy at law, and (4) there is a likelihood of success on the merits. Callis, Papa, Jackstadt & Halloran, P.C., 195 Ill. 2d at 365-66 . The decision to grant or deny a preliminary injunction rests within the sound discretion of the trial court and on review the decision will not be disturbed absent an abuse of discretion. People ex rel. Klaeren v. Village of Lisle, 202 Ill. 2d 164, 177 (2002).

In this case, there is no dispute regarding elements (1), (2) and (3), the existence of a clearly ascertainable right in need of protection, irreparable injury and the lack of an adequate remedy at law. The sole issue is whether defendants, who were seeking the preliminary injunction, made a fair showing that the restrictive covenants were valid and enforceable and that they were therefore likely to succeed on the merits of their claim against plaintiffs.

The majority correctly points out that the validity of covenants not to compete contained in employment contracts is a question of law (see Retina Services, Ltd. v. Garoon, 182 Ill. App. 3d 851, 856 (1989); see also Woodfield Group, Inc. v. DeLisle, 295 Ill. App. 3d 935, 938 (1998) (“determination of whether a restrictive covenant is enforceable is a question of law”)) which we review de novo (The Agency, Inc. v. Grove, 362 Ill. App. 3d 206, 215 (2005)). The situation here, however, is more complex. That is because plaintiffs’ challenge to the enforceability of the restrictive covenants includes, by way of an affirmative defense, the claim that defendants had breached the employment contracts of which the covenants were a part. Whether a breach of contract has occurred is not a legal question subject to de novo review. It is a question of fact which will not be disturbed unless the finding is against the manifest weight of the evidence. See Bunge Corp. v. Northern Trust Co., 252 Ill. App. 3d 485, 499 (1993).

Normally, affirmative defenses such as breach of contract may not be litigated on the merits in the context of a hearing on a motion for preliminary injunctive relief. See, e.g., Falcon, Ltd. v. Corr’s Natural Beverages, Inc., 165 Ill. App. 3d 815, 820 (1987). The reason for this rule, as the appellate court recognized, is that resolution of such matters requires the determination of controverted rights and resolution of matters bearing on the merits of the underlying case. Under established precedent, those are not appropriate objectives for proceedings seeking preliminary injunctive relief. As I have already indicated, preliminary injunctions precede hearings on the merits, and their purpose is not to decide the merits of a case, but to maintain the status quo and prevent a threatened wrong until the merits can be decided.

Although the majority makes no attempt to reconcile its approach with these principles, I believe that it has acted properly. What sets this litigation apart is that instead of deferring the hearing on the merits of the breach of contract claim until the trial, both plaintiffs and defendants elected to make an extensive evidentiary record on the question. In effect, the hearing on the breach of contract defense was treated as the actual trial on that issue. The situation is directly analogous to one where the parties expressly agree that the evidence presented in connection with a preliminary injunction should stand as the record for purposes of entering final judgment on the merits. See, e.g., City of Chicago v. Pooh Bah Enterprises, Inc., 224 Ill. 2d 390 (2006). Under these circumstances, the parties cannot possibly complain that addressing the breach of contract issues exceeds the permissible scope of our inquiry in this case. I note, moreover, that none of the parties has given any indication that additional relevant evidence exists that has not already been introduced. To refrain from deciding the breach of contract issues notwithstanding the existence of the fully developed evidentiary record already before us would serve no useful purpose.

For the foregoing reasons, I concur in the court’s judgment. Subject to the points raised in this separate concurrence, I also join its opinion.

JUSTICE CARMAN joins in this special concurrence.