Case Name: HAROLD S. LEOW, Appellant, v. A&B FREIGHT LINE, INC., et al. (A&B Freight Line, Inc., Appellee)
Court: Illinois Supreme Court
Jurisdiction: Illinois
Decision Date: 1997-02-06
Citations: 175 Ill. 2d 176
Docket Number: No. 80438
Parties: HAROLD S. LEOW, Appellant, v. A&B FREIGHT LINE, INC., et al. (A&B Freight Line, Inc., Appellee).
Judges: 
Reporter: Illinois Reports, Second Series
Volume: 175
Pages: 176–200

Head Matter:
(No. 80438.
HAROLD S. LEOW, Appellant, v. A&B FREIGHT LINE, INC., et al. (A&B Freight Line, Inc., Appellee).
Opinion filed February 6, 1997.
McMORROW, J., joined by MILLER and FREEMAN, JJ., specially concurring.
Sandra J. Slaga, of Joseph A. Morrissey & Associates, of Rockford, for appellant.
James P. Devine, of Williams & McCarthy, of Rockford, for appellee.
Peter R. Coladarci, Ltd., of Chicago, for amicus curiae Illinois Trial Lawyers Association.

Opinion:
JUSTICE HARRISON
delivered the opinion of the court:
On March 11, 1992, plaintiff, Harold Leow, suffered injuries in a loading dock accident. At the time of the accident, plaintiff was using a forklift to load skids containing manufactured products onto a semi-trailer truck owned by defendant A&B Freight Line, Inc., and operated by its employee, defendant Keith Pasch. Plaintiff alleges that without warning, Pasch drove the semi-trailer truck away from the loading dock, causing the forklift which Leow was operating to fall from the loading dock to the concrete floor below.
On March 8, 1994, Leow filed a single-count complaint naming A&B Freight Line, Inc., as the sole defendant. The count alleged that Keith Pasch committed various negligent acts which resulted in injury to plaintiff. The complaint further alleged that A&B Freight Line, through its employee, Pasch, was liable under the doctrine of respondeat superior for injuries suffered by Leow. On September 14, 1994, Leow filed an amended complaint adding a second count against Pasch. Count I of the amended complaint named A&B Freight Line and remained identical to the original complaint. Count II, against Pasch, alleged that his negligent operation of the semi-trailer truck resulted in permanent injuries to Leow.
Subsequently, Pasch filed a motion to dismiss count II, pursuant to section 2 — 619(a)(5) of the Code of Civil Procedure (735 ILCS 5/2 — 619(a)(5) (West 1994)), claiming that the two-year statute of limitations had run as to him. The trial court granted Pasch's motion to dismiss finding that Pasch was not properly named as a defendant until the amended complaint was filed on September 14, 1994, more than two years after the accident' took place. The ruling was made appealable pursuant to Supreme Court Rule 304(a) (155 Ill. 2d R. 304(a)) on September 28, 1994. Leow did not appeal this ruling.
On November 1, 1994, A&B Freight Line filed a motion to dismiss count I of plaintiff's complaint on the grounds that a dismissal with prejudice of an action against A&B Freight's employee, Pasch, barred any action against A&B Freight based on the doctrines of respondeat superior and res judicata. The trial court granted A&B Freight's motion to dismiss count I on January 31, 1995. The basis for this ruling was that the involuntary dismissal of count II, against Pasch, acted as a prior adjudication on the merits and therefore the doctrine of res judicata barred Leow's claim against A&B Freight.
Leow asked the trial court to reconsider its order of January 31, 1995, dismissing count I of his complaint. In his motion for reconsideration and other relief, Leow requested that the trial court amend its first order of September 28, 1994, dismissing count II by inserting language that the dismissal of Pasch was not an adjudication on the merits of the action against A&B Freight. The trial court denied Leow's motion to reconsider.
The appellate court affirmed, with one justice specially concurring. 276 Ill. App. 3d 985. The court held that the involuntary dismissal of count II, on statute of limitations grounds, was a prior adjudication on the merits pursuant to Supreme Court Rule 273 (134 Ill. 2d R. 273), and therefore the dismissal acted as res judicata to Leow's claim against A&B Freight. 276 Ill. App. 3d at 988. We granted Leow's petition for leave to appeal. 155 Ill. 2d R. 315. For the reasons which follow, we reverse.
At issue in this appeal is whether Pasch's involuntary dismissal, on statute of limitations grounds, oper ates as an adjudication on the merits barring Leow's timely respondeat superior claim against defendant, A&B Freight. We look to whether a prior judgment is an adjudication on the merits to determine whether it should be accorded res judicata effect against another defendant to the action.
The doctrine of res judicata provides that an adjudication on the merits "rendered by a court of competent jurisdiction is conclusive as to the rights of the parties and their privies." People ex rel. Burris v. Progressive Land Developers, Inc., 151 Ill. 2d 285, 294 (1992). An adjudication on the merits is an absolute bar to subsequent actions raising the same claims or demands and involving the same parties or their privies. Progressive Land, 151 Ill. 2d at 294. Courts have determined that for res judicata to bar a subsequent action, three criteria must be met: (1) there must be a final judgment on the merits rendered by a court of competent jurisdiction; (2) an identity of causes of action; and (3) an identity of parties or their privies. Progressive Land, 151 Ill. 2d at 294.
In this case, the only element of res judicata in serious dispute is the first element concerning whether the granting of the involuntary dismissal in favor of Pasch constitutes a final judgment on the merits barring the remaining claim against A&B Freight. The second element of res judicata is clearly present since Leow is suing both A&B Freight and Pasch for the same injuries arising out of the same accident. Furthermore, Leow's claim against A&B Freight is based on a theory of vicarious liability and under such a theory the employer and employee are considered to be " 'one and the same' defendant." Downing v. Chicago Transit Authority, 162 Ill. 2d 70, 74 (1994), quoting Towns v. Yellow Cab Co., 73 Ill. 2d 113, 125 (1978). Therefore, for res judicata purposes, A&B Freight is in privity with Pasch and the third ele ment is present. The only remaining dispute is whether the first element was established.
Therefore, we need to determine whether the involuntary dismissal of Pasch, due to the two-year statute of limitations running, should operate as an adjudication on the merits barring suit against Pasch's employer. Plaintiff contends that the involuntary dismissal of Pasch could not be considered an adjudication on the merits because the actual merits of Leow's claim were never examined. Plaintiff notes that the only issue the court resolved when it dismissed Pasch was that he was named a party to the lawsuit after the statute of limitations had run. Plaintiff contends that a prior judgment should not be accorded res judicata effect, against another defendant to the action, unless the judgment reached the actual merits of the suit. In support, Leow cites to Downing v. Chicago Transit Authority, 162 Ill. 2d 70 (1994), a recent decision of this court.
In Downing, this court held that a summary judgment order, entered in favor of a bus driver on statute of limitations grounds, was not a res judicata bar to a timely respondeat superior suit against the Chicago Transit Authority (CTA), which employed him. In Downing, a CTA bus driven by defendant Williams struck plaintiff, a bicyclist. Plaintiff filed suit against the CTA and its "unknown employee and agent." As in the case at bar, plaintiff amended his complaint naming both the employee and employer as defendants after the two-year statute of limitations had expired. First, the trial court granted summary judgment in favor of Williams, reasoning that he was not properly named a defendant until more than two years after the accident took place. Subsequently, the trial court granted the CTA's motion for summary judgment and the appellate court affirmed. The basis for these rulings by the lower courts was that "the summary judgment in favor of Williams was a prior adjudication on the merits, and therefore the doctrine of res judicata barred plaintiffs present claims against the CTA." Downing, 162 Ill. 2d at 73.
This court reversed. The court determined, as we have here, that the only element of res judicata in dispute was whether the judgment releasing the employee from liability was considered an adjudication on the merits. Downing, 162 Ill. 2d at 74. In determining whether the summary judgment as to Williams was an adjudication on the merits, this court stated it "cannot ignore the basis on which the summary judgment was granted." Downing, 162 Ill. 2d at 77. This court went on to examine the basis for granting summary judgment in Downing and reasoned that: "When a summary judgment is granted because the statute of limitations has run, the merits of the action are never examined." Downing, 162 Ill. 2d at 77. The Downing court held that when the basis for granting summary judgment bears no relationship to the actual merits of the case, "it would be inappropriate to apply the doctrine of res judicata to another party to the action." Downing, 162 Ill. 2d at 77. Finally, this court concluded that to label a summary judgment order, such as the one in Downing, an adjudication on the merits "would be the quintessential act of exalting form over substance." Downing, 162 Ill. 2d at 77.
The Downing decision seems virtually identical to the case at bar. In both cases, the employers were timely named, but claims against the employees were not added until after the statute of limitations had expired. Both employees received either an involuntary dismissal or summary judgment in their favor based on their statute of limitations defenses. Subsequently, the employers remaining in both suits claimed that the release of their employees, on statute of limitations grounds, operated as adjudications on the merits barring the claims against them. At issue in both cases was whether these prior judgments should be given res judicata effect with respect to the remaining defendants.
As stated, the Downing court concluded that the basis for granting summary judgment bore no relationship to the actual merits of the case. Therefore, the court refused to label a summary judgment order on statute of limitations grounds an adjudication on the merits. In the present case, if we apply the reasoning from Downing and look to the basis on which the involuntary dismissal was granted, we must also conclude that the actual merits of the action were never examined. In both cases, the only issue the lower courts decided was whether the employees were timely named as defendants. As in Downing, the basis for granting the employee's motion bears no relationship to the actual merits of Leow's case. Under this reasoning, it would be improper to apply the doctrine of res judicata to another party to the action.
The only distinction which can be drawn between the two cases is the type of procedural device used by the defendant employees to assert their statute of limitations defenses. As stated in Downing, the driver filed a motion for summary judgment, while in the case at bar, Pasch filed a section 2 — 619 motion to dismiss. Defendant A&B Freight contends that the difference between the procedural choice of a motion for summary judgment over a motion to dismiss is critical. Defendant asserts that such a distinction is critical because pursuant to Illinois Supreme Court Rule 273 (134 Ill. 2d R. 273) an involuntary dismissal of an action is deemed an adjudication on the merits for purposes of invoking the doctrine of res judicata. Rule 273 states that "[ujnless 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." 134 Ill. 2d R 273. Defendant asserts that since the involuntary dismissal of Pasch did not fall under one of these exceptions outlined in Rule 273, and the order of dismissal did not specify otherwise, the judgment in favor of Pasch operated as an adjudication on the merits.
Defendant argues that Downing supports this interpretation of Rule 273. The Downing court did recognize a distinction between an involuntary dismissal and an order granting summary judgment, stating that Rule 273 only applies to involuntary dismissals such as when a motion to dismiss under section 2 — 615 or 2 — 619 is granted. Downing, 162 Ill. 2d at 75. Furthermore, the court stated in dicta that if Rule 273 had applied in Downing, it would compel the opposite result because certain "involuntary dismissals do indeed operate as judgments on the merits." Downing, 162 Ill. 2d at 75.
Following Downing, this court applied Rule 273 in Rein v. David A. Noyes & Co., 172 Ill. 2d 325, 335-36 (1996), to hold that the dismissal of a claim on statute of limitations grounds operated as an adjudication on the merits barring plaintiffs from asserting that claim in a successive action against the same defendants. Rein, however, is distinguishable. Unlike that case, the matter before us involves a separate claim against a different defendant.
This distinction is critical. Where a different defendant is involved, as in the present case, Rule 273 cannot be applied mechanically, because doing so would yield absurd and unjust results. If the rule could be invoked here, plaintiff would be precluded from seeking redress from A&B Freight, the employer, simply because he made a belated attempt to join Pasch, the employee. Had he never attempted to join the employee, the action against A&B Freight would have proceeded nor- molly. Considering that the employee is not even a necessary party to the litigation against the employer in cases such as this (see McCottrell v. City of Chicago, 135 Ill. App. 3d 517, 519 (1985)), dismissal of A&B Freight based on plaintiff's delay in adding Pasch makes no sense at all.
To avoid such anomalies, we must look to the purpose and intent of Rule 273 in determining whether a dismissal against one defendant based on statute of limitations grounds should be deemed to be an adjudication on the merits as to a different defendant. Rule 273 was adopted in 1975 and was modeled after Federal Rule of Civil Procedure 41(b). 58 Ill. 2d R. 273, Committee Comments. Therefore, we will examine Rule 41(b) and its history to guide our interpretation of Rule 273. At common law, a dismissal on grounds other than the actual merits of the case would not constitute res judicata in a later case. Madden v. Perry, 264 F.2d 169, 175 (7th Cir. 1959); Haldeman v. United States, 91 U.S. 584, 585-86, 23 L. Ed. 433, 434 (1876). The Supreme Court has stated that it did not discern in Rule 41(b) "a purpose to change this common-law principle with respect to dismissals in which the merits could not be reached for failure of the plaintiff to satisfy a precondition." Costello v. United States, 365 U.S. 265, 286, 5 L. Ed. 2d 551, 565, 81 S. Ct. 534, 545 (1961). According to the Supreme Court, the res judicata effect of Rule 41(b) dismissals was intended to apply to situations where a defendant had to incur the inconvenience of preparing to meet the merits of a controversy. Costello, 365 U.S. at 286, 5 L. Ed. 2d at 565, 81 S. Ct. at 545.
Applying these principles, the Supreme Court, in Costello, held that the dismissal of a previous complaint in a denaturalization proceeding, for failure to file an affidavit of good cause, was not an adjudication on the merits under Rule 41(b). The Court reasoned that when determining whether dismissals, not otherwise provided for under the rule, operate as adjudications on the merits, "it seems reasonable to confine them to those situations where the policy behind the enumerated grounds is equally applicable." Costello, 365 U.S. at 286, 5 L. Ed. 2d at 565, 81 S. Ct. at 545. The Court further reasoned that obtaining a dismissal, due to the government's failure to file an affidavit, did not put the petitioner to the trouble of preparing a defense and meeting the merits of the case. Costello, 365 U.S. at 287, 5 L. Ed. 2d at 565, 81 S. Ct. at 545. Therefore, the Supreme Court held that the policy behind Rule 41(b) would not be furthered by treating a dismissal for failure to file an affidavit as an adjudication on the merits. Costello, 365 U.S. at 287, 5 L. Ed. 2d at 566, 81 S. Ct. at 546.
Accordingly, where separate defendants are involved, we hold that as with Rule 41(b), only those types of involuntary dismissals that serve the policy behind Supreme Court Rule 273 should be treated as adjudications on the merits. Since Rule 273 was modeled after Federal Rule 41(b), the policy behind the rules is the same. As with Rule 41(b) dismissals, the res judicata effect of Rule 273 dismissals was also intended to apply to situations where defendants are put to the inconvenience of preparing to meet the merits of the case. Rule 273 was designed to protect a defendant from relitigating the same matter over again after the defendant or his privy was dismissed in a prior proceeding.
That policy is not served by dismissing A&B Freight from this case. From our previous analysis, it is apparent that A&B Freight never had to incur the inconvenience of preparing a defense and meeting the merits of this controversy. In this case, Pasch, A&B Freight's agent, was dismissed from this action for the sole reason that he was not properly named a defendant until after the statute of limitations had expired. Such an order of dismissal only decides the merits of Pasch's section 2 — 619 motion and was not a determination of the merits of the underlying claim. Since the merits were never examined, A&B Freight was never put to the inconvenience of preparing a defense. A&B Freight merely asserted that Pasch's involuntary dismissal, on grounds not even in controversy in A&B Freight's suit, acted as res judicata to plaintiffs claim against A&B Freight. In effect, Pasch's defense was simply transferred to A&B Freight, and no issues between Leow and A&B Freight were ever actually decided. We conclude that the policy behind Rule 273, and its model, Federal Rule 41(b), would not be furthered by treating an involuntary dismissal on statute of limitations grounds as an adjudication on the merits under these circumstances.
We further find that the fact that the employee in this case utilized a section 2 — 619 motion to dismiss, rather than a motion for summary judgment, does not warrant a different result from that reached in Downing. The policy behind Rule 273 and its federal counterpart supports a decision consistent with the reasoning in Downing. To adhere to the policy behind Rule 273, an involuntary dismissal as to the employee, like a summary judgment, should not be automatically labeled a judgment on the merits with respect to the employer. But rather, as directed in Downing, the basis on which the judgment was granted should be examined to determine whether the merits of the case were ever considered.
Moreover, on a section 2 — 619 motion to dismiss, a trial court has even less of an opportunity to examine the real merits of a plaintiffs case than on a motion for summary judgment. On motions for summary judgment, trial courts normally examine pleadings, depositions, admissions on file, and affidavits to determine whether
there is any general issue of material fact to be tried by a jury. Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511, 517-18 (1993). Section 2 — 619 motions to dismiss, on the other hand, provide a mechanism for courts to dispose of issues of law based on certain defects and defenses, outlined in the statute. 735 ILCS 5/2 — 619 (West 1994). In Downing, the court already determined that an order granting summary judgment to an agent, on statute of limitations grounds, was not a bar to the action against the principal, the reason being that when summary judgment is granted for failure to meet the statute of limitations, the actual merits of the suit are never examined. Downing, 162 Ill. 2d at 77. The standard should not be higher for section 2 — 619 dismissals, where a court has even less chance to look at the merits of the underlying cause of action. We conclude that there is no reason to treat a section 2 — 619 motion to dismiss differently than a motion for summary judgment when both motions were granted on the same grounds.
In this case, as in Downing, Pasch was dismissed from the suit for reasons bearing no relationship to the actual merits. We conclude that the involuntary dismissal of Pasch was not an adjudication on the merits as to A&B Freight. The first element of res judicata was not present in this case; therefore, it was error to grant A&B Freight's motion to dismiss. As in Downing, in the present case, plaintiff's action against the principal was not barred by the doctrine of res judicata. Accordingly, we reverse the judgments of the circuit and appellate courts and remand to the circuit court for further proceedings.
Appellate court reversed; circuit court reversed; cause remanded.