Title: Corral v. Mervis Industries, Inc.

State: illinois

Issuer: Illinois Supreme Court

Document:

Docket No. 99698-Agenda 24-May 2005.
FERNANDO CORRAL, JR., Personal Representative of the Estate

of Fernando Corral, Sr., Deceased, Appellee, v. MERVIS
INDUSTRIES, INC., Appellant.
Opinion filed October 20, 2005.
	JUSTICE KILBRIDE delivered the opinion of the court:
	In this appeal we address: (1) the proper standard of review for
the grant or denial of a motion to transfer on the ground of improper
venue; and (2) whether the circuit court of Cook County erred in
denying defendant's motion to transfer venue.
	This interlocutory appeal arises from the circuit court of Cook
County's denial of defendant's motion to transfer venue. The appellate
court affirmed the circuit court's denial of defendant's motion. No.
1-03-0129 (unpublished order under Supreme Court Rule 23). We
allowed defendant's petition for leave to appeal (177 Ill. 2d R. 315).
	We hold: (1) the factual determinations of the trial court on a
motion to transfer venue are subject to a manifest weight of the
evidence standard of review; (2) the legal effect of the trial court's
factual findings is subject to de novo review. We are, however, unable
to review the trial court's factual determinations in this appeal because
of an incomplete record. Consequently, we affirm the order of the
circuit court of Cook County.

I. BACKGROUND
	On April 12, 2001, Fernando Corral, Sr., was killed while
working at defendant's scrap recycling yard in Danville, Vermilion
County. On January 15, 2002, Fernando Corral, Jr., the personal
representative of the decedent's estate, filed a wrongful-death action
in Cook County.
	On April 4, 2002, defendant filed a motion to transfer in lieu of
answering the complaint. Defendant moved to transfer the cause to
Vermilion County, alleging Cook County is an improper venue. The
circuit court of Cook County denied defendant's motion to transfer
the cause to Vermilion County on December 16, 2002.
	Pursuant to Supreme Court Rule 306(a)(4) (166 Ill. 2d R.
306(a)(4)), defendant filed a petition for leave to appeal to the
appellate court on January 15, 2003. Rule 306(a)(4) permits a party
to petition for leave to appeal to the appellate court from a trial court
order granting or denying a motion to transfer venue "based on the
assertion that the defendant is not a resident of the county in which the
action was commenced, and no other legitimate basis for venue in that
county has been offered by the plaintiff." 166 Ill. 2d R. 306(a)(4).
	Defendant filed a supporting record with its petition for leave to
appeal, as required by Rule 306(c) (166 Ill. 2d R. 306(c)). The
supporting record contained the following documents:
			(1) defendant's motion to transfer venue, with the
following attachments: (a) complaint; (b) summons; (c)
return of service on summons; (d) printout from Illinois
Secretary of State's website; (e) affidavit of Michael Smith,
vice president and CFO of defendant, Mervis Industries, Inc.;
			(2) plaintiff's response to defendant's motion to transfer
venue;
			(3) defendant's reply in support of motion to transfer
venue;
			(4) transcript of discovery deposition of Michael Smith;
and
			(5) order of the circuit court of Cook County, denying
defendant's motion to transfer venue.
	In his discovery deposition, Michael Smith, vice president and
CFO of defendant, testified that defendant operates scrap processing
facilities in Danville, Champaign, Mattoon, and Springfield, Illinois.
According to Smith, defendant processes metal, paper, and plastic for
sale to an end user. Smith testified that defendant's only Cook County
connection is a sales employee, Bob Samson, who works full time for
defendant from an office in Samson's home. Defendant equipped
Samson's home office with a computer, fax machine and fax number,
a dedicated business telephone line, and an e-mail address. Samson is
defendant's only plastic scrap broker and conducts sales for defendant
from the business telephone line in his home office. Smith testified that
Samson answers the business phone line in his home by saying
"Mervis Plastics."
	According to Smith, the only time Samson has traveled to
defendant's headquarters in Danville was for his hiring interview.
Smith acknowledged during his deposition that plastic scrap sales
generate annual revenues of $1,500,000 to $1,750,000.
	In addition to defendant's Cook County employee, defendant
sells a small amount of stainless steel in Cook County. The Cook
County steel sales represent less than 1% of defendant's total sales.
	The order of the circuit court denying defendant's motion to
transfer venue states:
		"This cause coming to be heard on motion of defendant,
Mervis Industries, to transfer venue; it is hereby ordered that
defendant's motion is denied. This matter is set for status on
the pleadings for 2/7/03 at 9:15 a.m."
	The appellate court allowed defendant's petition for leave to
appeal. 166 Ill. 2d R. 306(a)(4). On November 4, 2004, the appellate
court affirmed the circuit court. No. 1-03-0129 (unpublished order
under Supreme Court Rule 23). The appellate court's order stated:
		"The trial court held that Mervis had an office in Cook
County, because one of Mervis's employees worked in his
Cook County home. We agree with the trial court that the
home office here sufficed to establish corporate residence for
venue purposes."
The appellate court further concluded:
			"Mervis brokered plastic scrap from an office in its
employee's home in Cook County. Because Mervis had an
'other office' in Cook County, the trial court correctly held
that Mervis was a resident of Cook County for venue
purposes."
We allowed defendant's petition for leave to appeal. 177 Ill. 2d R.
315.

II. ANALYSIS
	Defendant raises two issues in its appeal. First, defendant argues
reviewing courts should apply a de novo standard of review to orders
denying a motion to transfer venue from an improper forum when the
facts are undisputed. Second, defendant argues the circuit court of
Cook County erred in denying its motion to transfer venue to
Vermilion County because its employee's home is not an office of
defendant and, therefore, Cook County is an improper venue. We
address each of defendant's arguments seriatim.

A. Standard of Review
	We first examine the proper standard of review for the grant or
denial of a motion to transfer based on improper venue. We begin our
analysis by reviewing the venue statutes. Section 2-101 of the Code
of Civil Procedure (Code) (735 ILCS 5/2-101 (West 2000)) generally
governs venue and provides, in relevant part:
			"Except as otherwise provided in this Act, every action
must be commenced (1) in the county of residence of any
defendant who is joined in good faith and with probable
cause for the purpose of obtaining a judgment against him or
her and not solely for the purpose of fixing venue in that
county, or (2) in the county in which the transaction or some
part thereof occurred out of which the cause of action arose."
	Section 2-102 of the Code specifically defines the residence of
corporations and provides, in pertinent part:
			"For purpose of venue, the following definitions apply:
			(a) Any private corporation *** organized under the laws
of this State *** is a resident of any county in which it has its
registered office or other office or is doing business." 735
ILCS 5/2-102 (West 2000).
	Defendant contends a motion to transfer to a proper venue
presumes the forum county is not a proper venue. According to
defendant, where venue is improper in the forum county, the circuit
court has no discretion and must transfer venue to a proper forum.
Thus, defendant insists the proper standard of review is de novo.
Plaintiff, on the other hand, asks this court to adopt a "clearly
erroneous" standard of review.
	There appear to be conflicting decisions in our appellate court
concerning the proper standard of review on a motion to transfer
based on improper venue. Home Depot, U.S.A., Inc. v. Department
of Revenue, 355 Ill. App. 3d 370 (2d Dist. 2005), applied a de novo
standard of review to the issue of whether statutory venue
requirements had been met and then applied an abuse of discretion
standard of review to the ultimate issue of venue where more than one
venue is proper. Other appellate court cases have only applied a de
novo standard of review to determine whether the facts of a particular
case met statutory venue requirements. See Reynolds v. GMAC
Financial Services, 344 Ill. App. 3d 843 (5th Dist. 2003); Boxdorfer
v. DaimlerChrysler Corp., 339 Ill. App. 3d 335 (5th Dist. 2003);
Reichert v. Court of Claims, 327 Ill. App. 3d 390 (5th Dist. 2002),
vacated on other grounds, 203 Ill. 2d 257 (2003); Lake County
Riverboat L.P. v. Illinois Gaming Board, 313 Ill. App. 3d 943, 951
(2d Dist. 2000). Still, other appellate court cases have applied an
abuse of discretion standard of review. See Southern & Central
Illinois Laborers' District Council v. Illinois Health Facilities
Planning Board, 331 Ill. App. 3d 1112 (5th Dist. 2002); Johnson v.
Compost Products, Inc., 314 Ill. App. 3d 231 (2d Dist. 2000); Long
v. Gray, 306 Ill. App. 3d 445 (1st Dist. 1999). To be sure, this court
has not been entirely clear on expressing the standard of review to be
applied on appeal from an order of the circuit court granting or
denying a motion to transfer based on improper venue, and the
confusion among our appellate districts concerning the proper
standard of review is understandable.
	Those appellate court cases applying the abuse of discretion
standard of review relied on Stambaugh v. International Harvester
Co., 102 Ill. 2d 250 (1984). Stambaugh applied an abuse of discretion
standard of review to an appeal from the denial of a motion to transfer
based on improper venue. Stambaugh, 102 Ill. 2d  at 263. Stambaugh
did not offer any analysis or explanation concerning the applicable
standard of review, but simply cited Morrison v. Community Unit
School District No. 1, 44 Ill. App. 3d 315 (1976), for the abuse of
discretion standard of review. As the Reichert court aptly observed,
Morrison did not involve a motion to transfer based on improper
venue but, rather, a motion to transfer from a proper venue based on
prejudice of the forum county's jury pool. Reichert, 327 Ill. App. 3d
at 393. A motion to transfer from one proper venue to another based
on potential prejudice requires the trial court to exercise discretion
and merits application of the abuse of discretion standard of review.
	Since Stambaugh, this court has clarified the proper deference to
be accorded the trial court via applicable standards of appellate
review. In People v. Coleman, this court acknowledged "[t]he
manifestly erroneous standard represents the typical appellate standard
of review for findings of fact made by a trial judge." People v.
Coleman, 183 Ill. 2d 366, 384-85 (1998), citing M. Davis, A Basic
Guide to Standards of Judicial Review, 33 S.D. L. Rev. 469, 470-71
(1988). Accordingly, we determined that the manifestly erroneous
standard of review is only appropriate when reviewing the propriety
of an order of the circuit court granting or denying relief at the
conclusion of the evidentiary stage of a proceeding. Coleman, 183 Ill. 2d  at 385. Although Coleman involved a proceeding under the Post-Conviction Hearing Act (725 ILCS 5/122-1 et seq. (West 1994)), this
court has recognized that, "[t]ypically, the manifest error standard is
appropriate to review findings of fact made by a trial judge" in other
civil actions. See Webster v. Hartman, 195 Ill. 2d 426, 432 (2001),
citing Coleman, 183 Ill. 2d  at 384-85.
		Coleman further noted the abuse of discretion standard of review
has traditionally been reserved for trial court decisions deserving great
deference, such as overseeing the courtroom or maintaining the
progress of trials. Coleman, 183 Ill. 2d  at 387. Coleman
acknowledged the abuse of discretion standard of review "has been
recognized as 'the most deferential standard of review available with
the exception of no review at all.' " Coleman, 183 Ill. 2d  at 387,
quoting 33 S.D. L. Rev. at 480. Consequently, Coleman concluded
the use of such a deferential standard was inappropriate to review a
ruling that did not require the trial court to exercise any discretion.
Coleman, 183 Ill. 2d  at 387.
		Coleman also recognized that when all factual inquiries are
eliminated, and the trial court's inquiry is limited to the sufficiency of
the allegations, the question becomes a legal one. Accordingly, the
trial court's ultimate legal determination is subject to de novo plenary
review. Coleman, 183 Ill. 2d  at 388-89.
	We agree with defendant that it is inappropriate to apply an abuse
of discretion standard of review on appeal from the grant or denial of
a motion to transfer based on improper venue. As the Reichert court
correctly recognized, "[e]ither the facts support venue in the county
in which the action was filed or they do not. Once this factual
determination is made, the trial court has no discretion as to whether
to grant or deny the motion." Reichert, 327 Ill. App. 3d at 393-94.
	The "clearly erroneous" standard of review, suggested by
plaintiff, has been employed by this court only in reviewing decisions
of administrative agencies. See Carpetland U.S.A., Inc. v. Illinois
Department of Employment Security, 201 Ill. 2d 351, 369 (2002);
AFM Messenger Service, Inc. v. Department of Employment Security,
198 Ill. 2d 380, 395 (2001); City of Belvidere v. Illinois State Labor
Relations Board, 181 Ill. 2d 191, 205 (1998). Agency determinations
have historically been entitled to great deference due to an agency's
experience and expertise in interpreting its governing statutes. See
AFM Messenger, 198 Ill. 2d  at 394-95. We therefore decline
plaintiff's invitation to adopt a "clearly erroneous" standard of review
for trial court orders granting or denying a motion to transfer based
on improper venue.
	In determining the proper scope of review on a motion to transfer
based on improper venue, we find Lake County Riverboat instructive.
In Lake County Riverboat, the appellate court noted that proper venue
determinations involve separate questions of fact and law. Lake
County Riverboat, 313 Ill. App. 3d at 951, citing ServiceMaster Co.
v. Mary Thompson Hospital, 177 Ill. App. 3d 885, 891-95 (1988)
(reviewing the facts of the case and then determining as a matter of
law whether venue is proper). Lake County Riverboat properly
recognized that questions of fact are reviewed for manifest error, and
questions of law are reviewed de novo. Lake County Riverboat, 313
Ill. App. 3d at 951. When there is no dispute concerning the facts
relied upon by the court, Lake County Riverboat concluded a de novo
standard of review was proper. Lake County Riverboat, 313 Ill. App.
3d at 951.
	We agree with the standards set forth by Lake County Riverboat.
The determination of proper statutory venue raises separate questions
of fact and law because it necessarily requires a trial court to rule on
the legal effect of its factual findings. In other words, after first
examining the facts of the case, the trial court must then determine
whether the venue statute is satisfied. The inquiry thus requires a two-step analysis. First, the trial court's underlying factual findings are
reviewed deferentially. A trial court's findings of fact will not be
disturbed on review unless those findings are against the manifest
weight of the evidence. Eychaner v. Gross, 202 Ill. 2d 228, 251
(2002). Second, the trial court's conclusion of law is reviewed de
novo. Eychaner, 202 Ill. 2d  at 252. With these standards of review in
mind, we now review the merits of this appeal.

B. Whether the Circuit Court Erred in Denying Defendant's Motion
to Transfer Venue
	Let us first be clear what is and is not at issue in this case.
Defendant based its motion to transfer solely on a claim that venue is
improper in Cook County. Defendant did not base its motion to
transfer on a claim of forum non conveniens. We do not, therefore,
consider whether the facts of this case would have supported a venue
transfer based on a claim of forum non conveniens.
	"Proper venue is an important statutory privilege." Bucklew v.
G.D. Searle & Co., 138 Ill. 2d 282, 288 (1990). A defendant has the
right to insist that a lawsuit proceed in a proper venue, provided the
defendant timely raises a venue objection. Williams v. Illinois State
Scholarship Comm'n, 139 Ill. 2d 24, 52-53 (1990). A defendant may
raise, waive, or forfeit an objection to improper venue. See 735 ILCS
5/2-104(b) (West 2000); Horn v. Rincker, 84 Ill. 2d 139, 145-46
(1981).
	We reiterate the determination of proper statutory venue raises
separate questions of fact and law. We will not disturb a trial court's
findings of fact unless those findings are against the manifest weight
of the evidence. Eychaner, 202 Ill. 2d  at 251; Webster, 195 Ill. 2d  at
432. "A decision is against the manifest weight of the evidence only
when an opposite conclusion is apparent or when the findings appear
to be unreasonable, arbitrary, or not based on the evidence."
Eychaner, 202 Ill. 2d  at 252. A reviewing court must not substitute its
own judgment for the judgment of the trier of fact. Kalata v.
Anheuser-Busch Cos., 144 Ill. 2d 425, 434 (1991). After reviewing
the trial court's factual findings, we review the legal effect of the trial
court's conclusions de novo. Eychaner, 202 Ill. 2d  at 252.
	It is the defendant's burden to prove plaintiff's venue selection
was improper. Weaver v. Midwest Towing, Inc., 116 Ill. 2d 279, 285
(1987). "In doing so, the defendant must set out specific facts, not
conclusions, and show a clear right to the relief asked for." Weaver,
116 Ill. 2d  at 285 (citing Taylor v. Southern Ry. Co., 350 Ill. 139, 143
(1932), and Winn v. Vogel, 345 Ill. App. 425, 430 (1952)). "Any
doubts arising from the inadequacy of the record will be resolved
against the defendant." Weaver, 116 Ill. 2d  at 285, citing Foutch v.
O'Bryant, 99 Ill. 2d 389, 391-92 (1984).
	Defendant argues the circuit court of Cook County erred in
denying its motion to transfer venue to Vermilion County. According
to defendant the circuit court held that Cook County is a proper venue
because the Cook County residence of a single employee of the
defendant constituted an "other office" of the defendant since that
employee does business from his residence. Nothing in the record
supports defendant's characterization of the circuit court's factual
determinations.
	Moreover, it is unclear how the appellate court could have
reviewed the circuit court's factual findings because nothing in the
supporting record contains any factual findings or the basis for the
circuit court's decision. The order of the circuit court denying
defendant's motion to transfer venue simply states, "This cause
coming to be heard on motion of defendant, Mervis Industries, to
transfer venue; it is hereby ordered that defendant's motion is denied."
The supporting record contains no transcript of the hearing on
defendant's motion to transfer venue. No additional record on appeal
or report of proceedings was provided to the appellate court as
permitted by Rule 306(h) (155 Ill. 2d R. 306(h)). There was no
bystander's report or agreed statement of facts filed as authorized
under Rule 323 (166 Ill. 2d R. 323). Moreover, the record provided
to this court for review was the same record presented to the appellate
court for its review.
	From our examination of the supporting record, we know only
that defendant's motion to transfer venue was called for hearing on
December 16, 2002. We do not know what evidence or arguments
were presented at that hearing, nor are we informed of the circuit
court's findings of fact or its reasoning in denying defendant's motion
to transfer venue. We only know that the circuit court denied
defendant's motion to transfer venue after conducting a hearing. Thus,
we cannot determine whether the circuit court's order is based on one
or more of the statutory bases for venue.
	This court has recognized that to support a claim of error, the
appellant has the burden to present a sufficiently complete record.
Webster, 195 Ill. 2d  at 432, citing Foutch, 99 Ill. 2d  at 391-92 ("an
appellant has the burden to present a sufficiently complete record of
the proceedings at trial to support a claim of error"). An issue relating
to a circuit court's factual findings and basis for its legal conclusions
obviously cannot be reviewed absent a report or record of the
proceeding. Webster, 195 Ill. 2d  at 432 ("Where the issue on appeal
relates to the conduct of a hearing or proceeding, this issue is not
subject to review absent a report or record of the proceeding").
	Without an adequate record preserving the claimed error, the
reviewing court must presume the circuit court had a sufficient factual
basis for its holding and that its order conforms with the law. Webster,
195 Ill. 2d  at 432; Foutch, 99 Ill. 2d  at 392. "Any doubts which may
arise from the incompleteness of the record will be resolved against
the appellant." Foutch, 99 Ill. 2d  at 392.
	Accordingly, we cannot review the claimed error to determine
whether the trial court's factual findings were against the manifest
weight of the evidence, or consider the legal effect of its factual
findings. Consequently, the appellate court's conclusion was not
supported by the record and we make no pronouncement on its
determination that venue was proper in Cook County based on its
conclusion that defendant maintains an "other office" in Cook County.
Nonetheless, we affirm its judgment affirming the denial of
defendant's motion to transfer venue to Vermilion County.

III. CONCLUSION
	For the foregoing reasons, we affirm the judgment of the
appellate court, affirming the order of the circuit court of Cook
County, denying defendant's motion to transfer based on improper
venue.
Affirmed.
	JUSTICE GARMAN took no part in the consideration or
decision of this case.