Gray v. National Restoration Systems, Inc.

PRESIDING JUSTICE CAMPBELL, concurring in part and dissenting in part:

I wholeheartedly concur with the analysis and conclusions of the majority detailed in sections II, III, and V of the opinion. However, I would affirm the judgment of the trial court in its entirety, and respectfully dissent from sections I and IV of the majority opinion.

I

The majority concludes that the trial court erred in dismissing plaintiffs second amended complaint against National Restoration Systems, Inc., after determining that National Restoration Systems, Inc., was the decedent’s immediate employer. The majority acknowledges the facts that both National Restoration Systems, Inc., and National Resurfacing, Inc., provided concrete repair, waterproofing and caulking services; are owned and operated by the same individuals, Thomas Reagan and Frank Reagan; and that the two companies operate out of the same corporate location, 4242 Kirchoff Road, in Rolling Meadows, as one company. However, the majority states merely that “[t]he decedent worked as a laborer at the Day’s Inn project” (354 Ill. App. 3d at 349), without revealing undisputed facts which show that the decedent was employed by both National entities beginning in the early 1990s.

The majority states that plaintiff filed her application for adjustment of claim against both entities, “National Resurfacing Inc. d/b/a National Restoration Systems,” on October 5, 1995 (354 Ill. App. 3d at 350) and that plaintiff named National Restoration Systems, Inc., as the decedent’s employer. On June 25, 1997, plaintiff filed her complaint in the circuit court of Cook County. On December 22, 1997, the trial court denied the motion to dismiss by National Restoration Systems, Inc., without prejudice, while at the same time specifically advising plaintiff that if plaintiff collected any money from National Restoration Systems, Inc., in a worker’s compensation proceeding, her complaint would be dismissed.

On March 1, 2000, plaintiff and her attorney signed a two-page settlement contract entitled: “Valerie Gray, widow of William Gray, deceased vs. National Restoration Systems, Inc., a/k/a National Resurfacing, Inc.,” which released all claims against the decedent’s employer. The settlement agreement names the “Employer-Respondent” as “National Restoration Systems, Inc.,” and the address of the employer is listed as “4242 Kirchoff Rd., Rolling Meadows, IL 60008.” The settlement contract provides in pertinent part as follows:

“Respondent, William Gray’s employer, National Restoration, Inc., to pay and petitioner to accept $220,000.00 in full and final settlement of any and all claims under the Worker’s Compensation and Occupational Disease Acts for all accidental injuries allegedly incurred as described herein and including any and all results or developments, fatal or non-fatal allegedly resulting from such accidental injuries. Issues exist between the parties as to whether petitioner has incurred injuries to the degree alleged and whether or not such injuries are compensable, and this settlement is made to amicably settle all issues. This settlement includes [illegible] for temporary total compensation and all medical, surgical and hospital expenses, past or future, for all of which petitioner expressly assumes responsibility. All rights under §§ 4, 8, 16 and 19 of the Act are expressly waived by the parties. *** This settlement represents a full and final resolution of all issues and a compromise of any and all benefits to which the claimants may be entitled pursuant to § 7 and § 8 of the Illinois Workers’ Compensation Act.” (Emphasis added.)

On May 31, 2000, the trial court entered an order finding that National Restoration Systems, Inc., was, at the time of the occurrence, William Gray’s immediate employer and granted National Restoration Systems, Inc.’s motion to dismiss with prejudice.

The majority here opines, however, that there remains a question of fact as to which National entity was the decedent’s employer. The majority relies on Laffoon v. Bell & Zoller Coal Co., 65 Ill. 2d 437 (1976), primarily for the court’s final language “interpreting” section 5(a) of the Workmen’s Compensation Act (formerly Ill. Rev. Stat. 1975, ch. 48, par. 138.5(a)), “as conferring immunity upon employers only from common law or statutory actions for damages by their immediate employees.” Laffoon, 65 Ill. 2d at 447 . Thus, the majority appears to conclude that even if National Restoration Systems, Inc., paid compensation benefits to plaintiff, National Resurfacing, Inc., may be sued in court by plaintiff as the “immediate” employer.

Laffoon is inapposite. There, the plaintiffs in three consolidated appeals were employees of subcontractors and were injured while working on sites controlled by general contractors that were separate entities from their subcontractor-employers. In all three situations, the plaintiffs’ subcontractor-employers carried no compensation insurance, and the plaintiffs recovered workers’ compensation benefits from the general contractors. Subsequently, the three plaintiffs filed complaints against the three general contractors alleging violations of the Structural Work Act (formerly Ill. Rev. Stat. 1975, ch. 48, par. 60 et seq.), and their complaints were dismissed pursuant to section 5(a) of the Workmen’s Compensation Act, which provided immunity from an action for damages by an employee of an uninsured subcontractor after being required to pay compensation benefits to that employee under section 1(a)(3) of the Act.

On appeal, the Illinois Supreme Court compared the facts of the three cases to the following hypothetical situation:

“Two men are working on a beam which suddenly collapses injuring both men. The first man is an employee of a subcontractor who has workmen’s compensation insurance. This man will receive compensation benefits from his employer and may subsequently sue the general contractor — or the person ‘engaging in any business or enterprise referred to in subsections 1 and 2 of Section 3 of [the Workmen’s Compensation] Act’ (hereinafter included under the term general contractor) — who, he maintains, is tortiously liable for his injuries. The second man is an employee of a subcontractor who carries no compensation insurance and has not ‘guaranteed his liability to pay such compensation.’ Under section 1(a)(3) of the Act, this man will receive compensation benefits from the general contractor. He will be precluded, however, under defendants’ interpretation of section 5(a) from maintaining a suit for damages against the general contractor even though he is liable for the employee’s injuries. Moreover, the general contractor who pays benefits to the injured employee is permitted by section 1(a)(3) to recover from the subcontractor the amount paid, and, thus, may suffer no monetary loss. Plaintiffs contend that a construction of section 5(a) which allows the result illustrated creates an arbitrary and impermissible classification among injured employees.” Laffoon, 65 Ill. 2d at 443-44 .

The court reversed, finding that a construction of section 5(a) of the Act which provided general contractors with immunity from actions for damages by injured employees of a subcontractor who carries no compensation insurance would result in an arbitrary classification. Laffoon, 65 Ill. 2d at 445 .

The facts of the present case are wholly distinguishable from those in Laffoon. Here, the record shows National Restoration Systems, Inc., was a subcontractor on the Days Inn project. Plaintiff here does not and cannot claim that National Restoration Systems, Inc., either failed to carry compensation insurance or that National Restoration Systems, Inc., was a general contractor that may be liable in a subsequent action under the Structural Work Act. National Restoration Systems, Inc., in fact, carried compensation insurance and paid compensation to the plaintiff in the amount of $200,000. While plaintiff has failed to allege that National Resurfacing, Inc., was uninsured, Thomas Reagan stated that both National entities were insured on the same policy of insurance by American States. Nor can plaintiff show that she can recover from National Restoration Systems, Inc., under a theory of “dual capacity.” 2

Plaintiff entered into a settlement contract that released all claims against National Restoration Systems, Inc., and National Resurfacing, Inc. A release is presumed valid, and the party challenging the release shoulders the burden of proving any assertion of invalidity. Brown v. Torin Corp., 175 Ill. App. 3d 544, 550 , 529 N.E.2d 1077 (1988). Settlements between parties should not be set aside absent a showing of fraud or mistake. Sheffield Poly-Glaz, Inc. v. Humboldt Glass Co., 42 Ill. App. 3d 865, 868 , 356 N.E.2d 837 (1976).

Contrary to the conclusion of the majority, there exists no question of fact that the decedent was employed by National Restoration Systems, Inc. Plaintiff makes no claim of mistake or confusion as to the identity of the decedent’s employer as a result of language of the settlement contract referring to “National Restoration Systems, Inc.,” on page one of the settlement contract, and as “National Restoration, Inc.” on the top portion of the second page. Plaintiff was well aware of the fact that National Restoration Systems, Inc., was the decedent’s employer at the time of his injury and that she was entering into a settlement agreement which would extinguish her claim in the circuit court against National Restoration Systems, Inc. The record further shows that plaintiff was well aware that the two National entities operated as one, as plaintiff accepted the decedent’s last paycheck written on the account of National Restoration, Inc., as well as a check for funeral expenses in the amount of $1,000 drawn on the same account.

The only rational explanation for the reference in the settlement contract to “National Restoration, Inc.,” is as a “scrivener’s error” which merely omitted the word “Systems”:

“[A ‘scrivener’] is ‘A writer; esp., a professional drafter of contracts or other documents.” Black’s Law Dictionary 1349 (7th ed. 1999).

A “scrivener’s error” is defined as a “clerical error”:

“clerical error. An error resulting from a minor mistake or inadvertence, esp. in writing or copying something on the record, and not from judicial reasoning or determination. • Among the boundless examples of clerical errors are omitting an appendix from a document; typing an incorrect number; mistranscribing a word; and failing to log a call.” (Emphasis added.) Black’s Law Dictionary 563 (7th ed. 1999).

We cannot give the contract a construction that would render the phrase superfluous or meaningless; we must give it some reasonable meaning. Huskey v. Board of Managers of Condominiums of Edelweiss, Inc., 297 Ill. App. 3d 292, 295 , 696 N.E.2d 753 (1998).

Several Illinois cases have confronted the issue of a scrivener’s error. In each instance, the correction was mechanical or technical in nature, not decisional or judgmental. See People v. Wyzgowski, 323 Ill. App. 3d 604, 606 , 752 N.E.2d 1253 (2001) (Court found “scrivener’s error” in an officer’s sworn report “merely a formal defect” where the report incorrectly stated the date of arrest as July 7, 2000, as opposed to July 6, 2000); Krilich v. Plencer, 305 Ill. App. 3d 709, 712-13 , 713 N.E.2d 231 (1999), quoting First Bank v. Rezek, 179 Ill. App. 3d 956, 959 (1989) (“ ‘The distinction between a clerical error and a judicial one does not depend upon the source of the error, but rather, upon whether it was the deliberate result of judicial reasoning and determination’ ”); Dauderman v. Dauderman, 130 Ill. App. 2d 807, 808-09 , 263 N.E.2d 708 (1970) (Trial court amended the parties’ divorce decree to read “$400.00 per month” rather than “$400.00.” Appellate court held the failure to include the words “per month” was clearly an “inadvertent clerical error” or “scrivener’s error” because the lump-sum award did not match the decree absent the language “per month”); People ex rel. Cameron, 214 Ill. 287, 290-91 , 73 N.E. 362 (1905) (Although a legal description in a petition for the organization of a village — where the property must be contiguous — had been defective in that it referred to “the north three-fourths” instead of the “south three-fourths,” a plat attached to the petition was used for the purpose of correcting the scrivener’s error and giving effect to the intention of the petition); Garrick v. Chamberlain, 97 Ill. 620, 638 (1880) (A notice was considered valid when it described property as “lot 5, lot 23, in Carpenter’s addition” instead of “lot 5, in Block 23, in Carpenter’s addition” because the mistake was a typographical or a scrivener’s error readily apparent on the face of a notice).

Plaintiff cannot claim ignorance as to the identity of the decedent’s employer as a result of this minor typographical error, just as the majority must know the actual names of the parties notwithstanding the error in their identification at the outset of the opinion. The settlement contract acts to preclude any further recovery against National Restoration Systems, Inc.

I would further find that plaintiff is judicially estopped from claiming that the decedent was employed by National Resurfacing, Inc., rather than National Restoration Systems, Inc., and as such, plaintiff cannot maintain any further action under the Workers’ Compensation Act. As stated by the majority, when a party assumes a certain position in a legal proceeding, that party is estopped from assuming a contrary position in a subsequent proceeding. People v. Coffin, 305 Ill. App. 3d 595, 598 , 712 N.E.2d 909 (1999). Judicial estoppel is established by fulfilment of the following five factors: (1) the party being estopped must have taken two positions; (2) the positions must have been taken in separate judicial or quasi-judicial administrative proceedings; (3) the party must have intended for the trier of fact to accept the truth of the facts alleged in support of the position; (4) the party must have succeeded in asserting the first position and received some benefit from it; and (5) the two positions must be inconsistent. Coffin, 305 Ill. App. 3d at 598 . All of these elements are found in the present case.

Plaintiff has claimed in alternate complaints that the decedent was employed by National Restoration Systems, Inc., and by National Resurfacing, Inc. I would find that plaintiff is judicially estopped from maintaining this complaint against National Restoration Systems, Inc., as a result of the settlement agreement of her worker’s compensation claim.

I would further find plaintiff barred from her current complaint against National Restoration Systems, Inc., on principles of res judicata, having already entered into a settlement with National Restoration Systems, Inc., and by the Workers’ Compensation Act, which provides, as noted above, that once an injured employee has collected compensation under the Act, the employee cannot then allege that those injuries fall outside of the Act’s provisions. 820 ILCS 305/11 (West 2002) (“Compensation as full measure of employer’s responsibility”); Collier v. Wagner Castings Co., 81 Ill. 2d 229, 241 , 408 N.E.2d 198 (1980). I cannot conclude that the trial erred in granting the motion to dismiss of National Restoration Systems, Inc.

II

I also dissent from section IV of the opinion wherein the majority concludes that the trial court erred in granting partial summary judgment in favor of Hüls as to four paragraphs in plaintiff’s second amended complaint. In those paragraphs, plaintiff alleged various inadequacy of warnings, as detailed in the majority opinion. 354 Ill. App. 3d at 363-64. Plaintiff contends that the trial court’s ruling was not a final order and is otherwise erroneous.

The record shows that on September 13, 2000, the trial court entered judgment for Hüls on paragraphs (a) through (e) and (g) through (j) of plaintiffs negligence claims, and entered judgment for Hüls on several of plaintiffs claims for strict liability. Plaintiff appealed from that portion of the order pertaining to paragraphs (d) through (e) of the negligence claims and from the trial court’s order pertaining to the strict liability claims. Plaintiff now argues that the order entered by the trial court was not final in an attempt to preemptively defeat a res judicata argument by Hüls in support of the dismissal of her refilled case. The record shows that the order entered by the trial court was a final order and that plaintiff failed to appeal within 30 days as required by Supreme Court Rule 303(a). 134 Ill. 2d R. 303(a). This issue is res judicata as to plaintiffs refilled action and I would find that plaintiff has waived this issue for review on appeal. Accordingly, I dissent.

The case of Murcia v. Textron, Inc., 342 Ill. App. 3d 433 (2003), is instructive. There, the plaintiff sought damages for injuries he sustained while operating a trim press owned by his employer, Callen Manufacturing Company (Callen). Plaintiff asserted a claim of negligence against Callen, asserting that Callen operated in a “dual capacity,” both as his employer and as a “quasi manufacturer” of the trim press. The trial court dismissed the plaintiffs negligence claim as barred by section 5(a) of the Act. On appeal, this court affirmed, holding that the “dual capacity doctrine,” recognized as a limited exception to the exclusive remedy provision of section 5(a), under which an employer may become liable in tort to an injured employee if, in addition to acting in its capacity as employer, it operates in a second capacity that confers upon it obligations independent of those imposed upon it as employer, did not apply. The plaintiff failed to allege any “facts to support the conclusion that, by modifying, changing or altering the press, Callen incurred obligations unrelated to those flowing from its status as an employer.” Murcia, 342 Ill. App. 3d at 439 ; see also Rosales v. Verson Allsteel Press Co., 41 Ill. App. 3d 787 , 354 N.E.2d 553 (1976); Ocasek v. Krass, 153 Ill. App. 3d 215 , 505 N.E.2d 1285 (1987).