Court Opinion

ID: 3146450
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:16:17.761797+00
Date Added: 2024-06-11T11:55:12.434482
License: Public Domain

SIXTH DIVISION
                                                                                   December 21, 2007

No. 1-06-2622

                                                        )
THE VILLAGE OF OAK LAWN,                                )
                                                        )
                       Plaintiff-Appellant,             )       Appeal from the
                                                        )       Circuit Court of
v.                                                      )       Cook County, Illinois.
                                                        )
JOSEPH FABER,                                           )       No. 05 CH 19575
                                                        )
                        Defendant-Appellee.             )       Honorable
                                                        )       Sophia Hall
                                                        )       Judge Presiding.
                                                        )

        JUSTICE JOSEPH GORDON delivered the opinion of the court:

        Plaintiff, the Village of Oak Lawn (Oak Lawn), brought a declaratory judgment action

against defendant, Joseph Faber, its former long-time employee and village manager, alleging that

prior to the date a newly elected village board of trustees was to take office, the outgoing village

board voted to terminate Faber's employment so that he could claim a severance package totaling

nine months of his salary. Oak Lawn contended that the severance was improper in five respects:

that it constituted a gift of public funds (count I), that it was contrary to statutory provisions

requiring that a village manager's term be indefinite and that he be terminable at will (count II),

that it constituted unjust enrichment (count III), that it was contrary to statutory provisions

requiring that the village manager's term not exceed the term of the village president (count IV),

and that it violated the prior appropriation rule (count V). The parties brought cross-motions for

summary judgment and the circuit court ruled in favor of Faber. Oak Lawn now appeals the

circuit court's ruling with respect to counts I through IV. For the reasons that follow, we affirm.
No. 1-06-2622

                                         I. BACKGROUND

       Faber was employed by Oak Lawn as "Director of Administrative Services" from 1985

through 1992, and in1993, Faber became the village manager of Oak Lawn. In issue in this case

are the contracts Faber and Oak Lawn subsequently entered into continuing Faber's employment

as village manager.1 The first of those contracts, executed, May 11, 1999, stated that Faber

would act as village manager from June 1, 1999, through April 24, 2001. That agreement, which

was attached as an exhibit to Oak Lawn's complaint, further states in pertinent part as follows:

                 "I. TERM OF AGREEMENT

                 ***

                 At any time during the term of this Agreement, in the event that a majority

       of the Corporate Authorities (4 votes), no longer wish to retain the professional

       services of FABER, the VILLAGE shall be required to provide written notification

       thereof to FABER. In the event that such written notification of termination is

       provided to FABER, the VILLAGE shall be obligated to continue to pay FABER

       for a period of nine (9) months after notification of termination the herein agreed

       remunerations and deferred compensation and maintain standard

       employee benefits for FABER pursuant to the VILLAGE's Pay and Benefits

       Ordinance and Title 1 of the Oak Lawn Village Code (excluding the accrual of

       additional benefits effective with notification). In addition, the VILLAGE shall

       1
           Faber's previous contracts of employment with Oak Lawn, if any, are not part of this

appeal and are not in the record.

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No. 1-06-2622

      provide FABER with a lump sum payment for all accrued unused vacation days

      and up to a maximum of ninety (90) accrued unused sick days at FABER's then

      current rate of pay. The Village may demand that FABER no longer continue to

      be the actual employee and/or work in the capacity of Village Manager. The

      intent herein is to provide a minimum of nine (9) months of continued severance

      benefits to FABER after his receipt of any written notification of termination, in

      order to provide FABER with sufficient economic security during the time he is

      seeking alternative employment.

                II. EXTENDING THE TERM/FAILURE TO RENEW

                It is hereby agreed by the parties that the employment term may be

      extended for an additional period anytime during the term of this Agreement,

      thereby allowing this Agreement to continue in full force and effect in accordance

      with the desires of the parties involved. In the event the VILLAGE does not,

      within thirty days (30) after the expiration of the term of this Agreement, renew

      this Agreement to retain the services of FABER for a period of at least twelve (12)

      months, under similar terms and conditions of employment, then the VILLAGE

      shall pay to FABER severance pay in an amount equal to nine (9) months of his

      then current salary. In addition, the VILLAGE shall continue to maintain, for

      FABER, standard employee benefits pursuant to the VILLAGE's Pay and Benefits

      Ordinance and Title 1 of the Oak Lawn Village Code for a period of nine (9)

      months. Finally, the VILLAGE shall provide FABER with a lump sum payment

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No. 1-06-2622

      for all accrued unused vacation days and up to a maximum of ninety (90) accrued

      unused sick days at FABER's then current rate of pay. The severance pay and

      benefits are provided in consideration of his years of service to the VILLAGE and

      in recognition of the nature of the position held by FABER and the difficulty

      municipal managers have in obtaining comparable alternative employment. Any

      severance pay due under the Agreement shall be paid in either a lump sum thirty-

      one (31) days after the expiration of this Agreement or over a nine (9) month

      period pursuant to the VILLAGE's normal payroll process at the discretion of

      FABER, unless the parties agree in writing to an alternative payment schedule.

                                                 ***

                IX. RESIGNATION

                In the event that FABER wishes to terminate his services as provided for

      by this Agreement, a written notice of resignation shall be submitted to the

      Corporate Authorities no less than thirty (30) days prior to the effective date of

      said resignation. *** FABER, upon his resignation's effective date, shall be eligible

      only for benefits contained in and previously accrued pursuant to the VILLAGE's

      Pay and Benefits Ordinance and Title 1 of the Oak Lawn Village Code.

                X. JUST CAUSE TERMINATION

                In addition to the termination provisions set forth in the Section I above,

      after an evidentiary hearing upon written charges *** and a finding of just cause

      *** the VILLAGE may terminate this Agreement and the services of FABER.

                                                  4
No. 1-06-2622

       Just cause shall be limited to nonfeasance in official duties and/or any felony

       conviction. In the event of just cause termination, all remunerations, deferred

       compensation and standard employee benefits shall immediately cease to be paid

       or accrue other than previously accrued benefits for which FABER is entitled ***.

       IN addition, the nine (9) months of severance benefits, as set forth above, shall not

       apply in the case of a just cause termination.

                ***

                XII. EXPIRATION

                In the event a new Agreement is not negotiated and signed until after this

       Agreement has expired, but prior to the running of the thirty (30) days referenced

       in Section II above, the terms and conditions of this Agreement shall extend until a

       new Agreement is signed or said thirty (30) days has passed."

       Oak Lawn's complaint alleged that on April 30, 2001, the board of trustees and Faber

entered into an additional agreement, the "First Amendment to Village Manager Agreement"

(hereinafter first amended agreement) which extended Faber's term from April 24, 2001, through

"the first regular meeting of the president and Board of trustees in April, 2005." This first regular

meeting turned out to be April 12, 2005. Apart from extending the term of Faber's employment,

this agreement changed none of the terms of the original agreement.

       On April 5, 2005, a new village president and two new trustees were elected by Oak Lawn

voters. These officials were to take office on May 10, 2005, at the first regular village board

meeting in the May. However, prior to that date, on April 27, 2005, the board of trustees and

                                                  5
No. 1-06-2622

Faber entered into the "Second Amendment to Village Manager Agreement" (hereinafter second

amended agreement), which extended the term of Faber's employment until May 10, 2005. In

addition, the second amended agreement amended the original agreement by changing the 30-day

renewal period to 35 days and by adding an alternative method of paying accrued vacation and

sick days.

        On May 9, 2005, one day prior to the inauguration of the new president and two new

board members, the village board convened a special meeting at which it voted, 4 to 1, with one

abstention, to terminate Faber's employment. Following the installation of the newly elected

officials on May 10, 2005, Oak Lawn paid Faber his severance package in periodic installments.

The payments were made pursuant to approval of the village board and were eventually made in

full.

        On May 30, 2006, Oak Lawn filed a motion for summary judgment in which it argued that

the circumstances surrounding Faber's termination and the consequent triggering of the severance

package "smack[ed] of impropriety, [and were] an affront to honest government." Specifically,

Oak Lawn argued that it was entitled to summary judgment because the undisputed facts

established: (1) that the severance package was an impermissible gift of public funds; (2) that

"there was no prior appropriation for the last-minute severance package"; (3) that the severance

package extended Faber's employment and was thereby contrary to the "Municipal Code's

requirements as to the indefinite term of the village manager and that he be terminable at will"; (4)

that the severance package impermissibly extended Faber's employment beyond the term of the

president; and (5) that the severance package violated Oak Lawn's code of ethics.

                                                 6
No. 1-06-2622

       On June 19, 2006, Faber filed a cross-motion for summary judgment and a response to

Oak Lawn's motion in which he disputed Oak Lawn's arguments and further contended that Oak

Lawn's claims were barred by the voluntary payment and waiver doctrines. On August 10, 2006,

the circuit court denied Oak Lawn's motion and granted Faber's motion in its entirety. The record

does not reflect that any oral arguments were presented on these motions.

       As below, Oak Lawn argues on appeal that the severance pay constituted an impermissible

gift of public funds, that Faber violated Oak Lawn's code of ethics, that he was unjustly enriched,

that the amended agreements are void ab initio because their renewal periods potentially extended

Faber's employment past the term of the village president, and that the agreements, which

purported to appoint Faber for a specific term, were in violation of the Municipal Code's

requirement that the term of the village manager be indefinite. Faber disputes these contentions

and additionally argues that Oak Lawn's claims are barred by the waiver and voluntary payment

doctrines.

                                          II. ANALYSIS

       On appeals from summary judgment motions we conduct a de novo review. Outboard

Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90, 102, 607 N.E.2d 1204, 1209

(1992). "Summary judgment is appropriate when there are no genuine issues of material fact and

the moving party is entitled to judgment as a matter of law." Outboard Marine Corp., 154 Ill. 2d

at 102, 607 N.E.2d at 1209. Where, as here, the parties file cross-motions for summary

judgment, they agree that no issues of material fact exist and invite the court to decide the issues

presented as questions of law. Harwood v. McDonough, 344 Ill. App. 3d 242, 245, 799 N.E.2d

                                                  7
No. 1-06-2622

859, 862 (2003). However, the mere filing of cross-motions for summary judgment does not

preclude a determination that triable issues of fact remain. State Farm Mutual Automobile

Insurance Co. v. Coe, 367 Ill. App. 3d 604, 607, 855 N.E.2d 173, 176 (2006). Furthermore, the

interpretation and construction of contractual and statutory provisions are questions of law

subject to de novo review. See Krohe v. City of Bloomington, 204 Ill. 2d 392, 395, 789 N.E.2d

1211, 1212 (2003); Gallagher v. Lenhart, 367 Ill. App. 3d 293, 301, 854 N.E.2d 800, 807 (2006).

       As below, Oak Lawn contends that the second amended agreement's 13-day renewal of

Faber's employment and the outgoing board's subsequent termination of Faber the day before the

new board was to take office were mere devices to provide Faber with severance benefits he was

not entitled to. In this regard, Oak Lawn maintains that had the outgoing board not terminated

Faber, the new board would not have been obligated to pay the severance benefits. Oak Lawn

makes these assertions in support of its claims that the severance constituted an impermissible gift

of public funds, that Faber violated Oak Lawn's code of ethics, and that Faber was unjustly

enriched. We find that these assertions are premised on an incorrect construction of the

employment agreements in this case and that the claims associated with these charges are not

supported by the record.

       Faber's employment agreement with Oak Lawn, as originally executed and as amended

and renewed, sets out very specific and limited means by which Faber's employment with Oak

Lawn could come to an end. First, it clearly states that Faber's employment could be terminated

at any time by a majority vote of the corporate authorities. In other words, his employment was

terminable at will. The employment agreement next contemplates the possibility that Faber's

                                                 8
No. 1-06-2622

employment could come to an end through Oak Lawn's failure to renew the agreement once its

stated term had expired. Under either of these circumstances, Faber would become entitled to the

severance pay. We additionally note, however, that the agreement further sets out two

circumstances under which Faber would not become entitled to severance: first, if he resigns, and

second, if he is terminated for "just cause," which the agreement defines as "nonfeasance in

official duties and/or any felony conviction." There is no question here that Faber did not resign

and that he was not terminated for "just cause." The employment agreement does not set forth

any other possible scenario under which Faber's employment could come to an end.

       Thus, despite Oak Lawn's assertions to the contrary, the outgoing board's renewal of

Faber's employment through the second amended agreement did not provide Faber with any right

to severance that he did not already enjoy by virtue of the original and first amended agreements.

If the original agreement had ended without a new agreement being executed, Faber would have

been entitled to his severance pursuant to the plain language of the contract. By the same token,

if the first amended agreement came to an end without any further agreement being executed,

Faber would have been entitled to severance. Thus, Oak Lawn's assertion that the second

amended agreement was merely a ruse to provide Faber with severance pay is negated by the fact

Faber would have received that benefit anyway.

       Similarly, Oak Lawn's assertion that the new board only became obligated to the

severance benefits upon the outgoing board's last-minute termination of Faber is unsupported by

the actual contract provisions in this case. As noted, it is clear from the plain language of Faber's

employment agreements that there were only two scenarios under which Faber would not be

                                                  9
No. 1-06-2622

entitled to severance upon concluding his employment – if he were to resign, or if he were

terminated for cause. Thus, if the outgoing board had not terminated Faber the day before the

new officials were to take office, the new board would have been faced with the exact same

choices that were available to the old board: it could terminate Faber's employment and pay him

the severance package, it could opt to not renew his employment and pay him the severance

package, or it could renew his employment.

       This interpretation of the contract is consistent with the interpretation apparently given the

contract by the outgoing board. The minutes to the May 9 meeting at which Faber was

terminated state that the reasons for the termination included that "it was evident that the majority

of the new Board and Trustee Streit 2 did not want to retain Mr. Faber and they were not going to

honor the severance provisions in his contract." Thus, the outgoing board did not terminate

Faber in order to give him something he would not be entitled to claim from the new board;

rather, it terminated him to spare him the burden of having to assert his contractual right to the

severance package against the new board, which was apparently going to be disinclined to honor

the agreement.3 In other words, the outgoing board merely saved Faber the burden of potentially

having to bring suit against Oak Lawn for breach of contract.

       Oak Lawn referenced the aforementioned meeting minutes and explanation for the

       2
           Streit continued to serve on the new board and was the one "no" vote to Faber's

termination at the May 9 meeting .
       3
           Oak Lawn has not argued that Faber intended to resign and the termination was merely a

pretense to obtain the severance.

                                                  10
No. 1-06-2622

termination at oral arguments before this court but did not offer any countervailing interpretation

for its position that absent the termination, the new board would not have had to pay Faber's

severance. Nor does Oak Lawn makes any cognizable argument in its appellate briefs to refute

this construction of the employment agreements. Nevertheless, based on its faulty premise, Oak

Lawn goes on to argue its specific counts.

        Oak Lawn first contends that the severance constituted an unconstitutional gift of public

funds in violation of article 8, section 1, of the Illinois Constitution, which states, "Public funds,

property or credit shall be used solely for public purposes." Ill. Const. 1970, art. 8, §1. Oak

Lawn contends that Faber did not perform work to earn the severance package and that his past

performance did not constitute adequate consideration for the severance. We disagree.

        Although the constitutionality of severance pay for municipal employees has not yet been

specifically addressed by any Illinois court, the issue has been addressed in an Attorney General

opinion. See 1997 Ill. Att'y Gen. Op. 020. There, the Attorney General was asked whether a

township with fewer than five employees could provide severance benefits, to be paid from public

funds, to its employees. 1997 Ill. Att'y Gen. Op. 020. The Attorney General concluded that the

payment of severance benefits "is permissible if such benefits form part of an employment

agreement or employment policy which has been agreed to by the township and the employees in

advance." In his analysis, the Attorney General noted:

                "[C]ompensation and benefits of public employees must *** comply with

        the constitutional requirement that public funds and property be used only for

        public purposes. (Ill. Const. 1970, art. VIII, sec. 1(a).) Thus, it has been held that

                                                   11
No. 1-06-2622

       a payment or allowance in excess of that which was fixed by law or contract at the

       time when services were rendered, and when no further services are contemplated,

       is a gift for the private benefit of the individual, which serves no public purpose.

       [Citation.] Under this principle, it has been held that a terminated municipal

       employee could not recover monetary compensation for accumulated but unused

       leave time where no ordinance or contract provided for such compensation.

       [Citation.] However, post-employment compensation has been permitted where it

       serves an identified public purpose. Thus, public pension programs generally have

       been upheld as a form of deferred compensation to insure long, continued service.

       [Citations.]" 1997 Ill. Att'y Gen. Op. 020.

The Attorney General then concluded:

                "[S]everance benefits for public employees which form part of an

       employment agreement or policy agreed to in advance are not prohibited; in such

       circumstances, no additional compensation is to be paid, although the payment of

       compensation due under the terms of the agreement or policy is deferred until the

       employment relationship is completed. A gift or gratuity for the benefit of an

       employee who will render no further service, which has not been agreed to in

       advance by the parties, and to whom all compensation has been paid in accordance

       with an ordinance or agreement, however, would ordinarily not be permissible."

       (Emphasis added.) 1997 Ill. Att'y Gen. Op. 020.

       We find the reasoning of the Attorney General opinion sound and additionally note that its

                                                 12
No. 1-06-2622

conclusion is at least indirectly supported by cases cited by Oak Lawn in opposition to Faber's

severance. For instance, Oak Lawn cites Ziebell v. Board of Trustees of the Police Pension Fund,

73 Ill. App. 3d 894, 392 N.E.2d 101 (1979). In that case, the plaintiff police officer retired after

26 years of service at the age of 47. Ziebell, 73 Ill. App. 3d at 895, 392 N.E.2d at 102. At the

time of his retirement, the Illinois Pension Code provided that any policeman with 20 or more

years of service who has reached age 50 would be entitled to a yearly pension equal to half his

salary and that the pension would be increased by 1% for each additional year of service over 20

years. Ziebell, 73 Ill. App. 3d at 895-96, 392 N.E.2d at 102-03. On October 1, 1975, after

plaintiff's retirement but approximately two months before his fiftieth birthday, the Pension Code

was amended to increase the 1% increment for each additional year served over 20 to 2%.

Ziebell, 73 Ill. App. 3d at 896, 392 N.E.2d at 103. After reaching the age of 50, defendant

initially paid plaintiff at the higher rate but, after being informed by the Department of Insurance

that the lower rate should be applied, defendant lowered plaintiff's benefits. Ziebell, 73 Ill. App.

3d at 896, 392 N.E.2d at 103. Plaintiff brought a mandamus action, which the trial court

dismissed.

       The appellate court affirmed, noting that although the amended statute did not expressly

indicate that only those retiring subsequent to the statute's enactment were entitled to the higher

rate, such a construction was required because the alternative would constitute an

unconstitutional gift of public funds. Ziebell, 73 Ill. App. 3d at 897, 392 N.E.2d at 104. The

court noted that when the statute was amended to increase the pension benefits, the financing

section of the Pension Code was also amended to increase the amount of deductions from the

                                                 13
No. 1-06-2622

salaries of policemen. Ziebell, 73 Ill. App. 3d at 897, 392 N.E.2d at 104. Thus, under plaintiff's

construction of the statute, he would have been entitled to the higher benefit rate even though he

was never subject to the higher deductions. Ziebell, 73 Ill. App. 3d at 899, 392 N.E.2d at 104.

The court found that such a result would constitute an impermissible gift of public funds. Ziebell,

73 Ill. App. 3d at 899, 392 N.E.2d at 105.

       Oak Lawn contends that Faber, like the plaintiff in Ziebell, is not entitled to the additional

remuneration because he did not offer any additional consideration for the additional benefits.

However, unlike in Ziebell, where the benefits in question stemmed from a postretirement

amendment to the Pension Code, the benefits involved here were part of the original employment

agreement between the parties. The consideration Faber provided to Oak Lawn for those benefits

was the same consideration he provided throughout his employment, namely, his work as village

manager. Similarly, the consideration provided by Oak Lawn to Faber included not only his

salary and general benefits, but the additional benefit of a severance package that would be

deferred until the end of Faber's employment (see 1997 Ill. Att'y Gen. Op. 020) and would only be

available if Faber was terminated for other than just cause or not renewed. The plaintiff in Ziebell

had no claim for additional benefits because he had retired and ceased paying toward his pension.

Faber, on the other hand, never ceased earning his benefits, including the protection of severance

pay, until the day he was terminated. In fact, like the Attorney General in the aforementioned

opinion, the court in Ziebell recognized that where a benefit is based on an existing contract

between the parties, there is no constitutional problem. Ziebell, 73 Ill. App. 3d at 898, 392

N.E.2d at 104 (noting that in Raines v. Board of Trustees, 365 Ill. 610, 7 N.E.2d 489 (1937),

                                                 14
No. 1-06-2622

retired employees who continued to make contributions into the retirement fund had a contractual

relationship with the state and that "because of the contractual nature of the arrangement no

constitutional objection could be made on the ground that increased payments were being made

for past services").

        Oak Lawn also cites O'Fallon Development Co. v. City of O'Fallon, 43 Ill. App. 3d 348,

356 N.E.2d 1293 (1976), to support its position that the severance pay in this case was improper.

There, the city of O'Fallon was sued for allowing the name of a private shopping center to be

prominently displayed on a city-owned water tower. O'Fallon, 43 Ill. App. 3d at 350, 356 N.E.2d

at 1296. The court determined that the "advertising" constituted a purely private use of public

property in violation of the Illinois Constitution, noting that the "crucial test" in making such a

determination "is whether the attempted use of the municipal property subserves the public

interest and benefits a private individual or corporation only incidentally." O'Fallon, 43 Ill. App.

3d at 355, 356 N.E.2d at 1299. The court further stated: "If the private benefits are purely

incidental to the public purposes of the act, then *** the Illinois Constitution is not violated."

O'Fallon, 43 Ill. App. 3d at 355, 356 N.E.2d at 1299.

        Oak Lawn contends along these lines that the Faber's severance pay had no public benefit

whatsoever and was therefore unconstitutional. However, the severance was part of Faber's

original contract of employment and could not therefore be characterized as a mere afterthought

or an unbargained-for gift. Rather, the agreement explicitly recognizes that the severance was

part of the village's consideration to Faber in its statement that the severance benefits "are

provided in consideration of his years of service to the VILLAGE and in recognition of the nature

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No. 1-06-2622

of the position held by FABER and the difficulty municipal managers have in obtaining

comparable alternative employment." Thus, the severance provision can be viewed as a means to

attract eligible candidates to the position and to counteract the disincentive created by the

statutory requirement, and reflected in the contract, that the village manager be terminable at

will. 4 Moreover, Oak Lawn cannot dispute that Faber's execution of his duties as municipal

manager benefitted the village. The Illinois Municipal Code (the Code) makes clear that the work

of a municipal manager is integral to the day-to-day operations of a municipality. See 65 ILCS

5/5-3-7 (West 2004) (stating that the municipal manager "shall be the administrative head of the

municipal government and *** shall be responsible for the efficient administration of all

departments"). Thus, consistent with the rule expressed in O'Fallon, the severance provisions in

this case served the public interest in that they helped secure the professional commitment of an

individual in an essential municipal government position – a position in which Faber was

        4
            This rationale for the severance benefits is also reflected in an affidavit Faber filed as part

of his motion for summary judgment. There, he stated: "During my tenure, the village held

elections every two years, and the balance of power on the village board often shifted. Almost all

village elections were contested during my tenure. When accepting the position of manager, and

when agreeing to continue in that position at various times during my tenure, including when

signing the contracts at issue in this case, I relied on the village's promise that I would receive

severance pay if I were terminated as manager in making my decision to continue in that position.

I also took the potential severance benefits into account when negotiating my general salary and

other benefits."

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No. 1-06-2622

perpetually subject to termination at the whim of the board. The fact that Faber was compensated

for his work and commitment to the village does not invalidate the public benefit his efforts inured

to the village.

        For the same reasons, Oak Lawn's contention that the severance violates the village's code

of ethics fails. The Oak Lawn code provides in pertinent part that its appointed officials and

employees "shall conduct the government of the village with integrity and impartiality, without

allowing *** the opportunity for personal gain to influence their decisions or actions to interfere

with serving the public interest." Oak Lawn Village Code §1-15-1. This code does not prohibit

the village and a prospective employee from bargaining the terms of employment; nor does it

prohibit the village from offering severance pay as part of an employment contract. As noted

above, pursuant to his contracts of employment, Faber would have been entitled to severance

regardless of the outgoing board's last-minute termination of him and regardless of the second

amended agreement.

        Similarly, the same holds true for Oak Lawn's unjust enrichment argument. As noted by

Oak Lawn, "unjust enrichment" is defined as "the retention of a benefit conferred by another,

without offering compensation, in circumstances where compensation is reasonably expected.

Black's Law Dictionary (8th ed. 2004). Here, Faber and Oak Lawn reached an agreement that

Faber would work as municipal manager and, in return, Oak Lawn would pay him a salary and

additionally provide him with severance pay if he was terminated for other than just cause or if his

employment was not renewed. Thus, Faber's compensation to the village for the benefit of

severance pay was his work as municipal manager. The fact that Oak Lawn is now unhappy with

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the deal it struck does not mean that the honoring of that deal unjustly enriches Faber. Further, as

previously noted, Faber would have been entitled to severance even if the second amended

agreement, continuing Faber's employment for 13 days, were never executed and even if the

outgoing board had not terminated him. Therefore, those facts do not form a basis upon which to

invalidate the severance payments.

       Oak Lawn next contends that the first and second amended agreements are in violation of

the Illinois Municipal Code because they extended the term of Faber's employment beyond the

term of the village president and are, therefore, void ab initio. Section 8-1-7(b) states:

                "Notwithstanding any provision of this Code to the contrary, the corporate

       authorities of any municipality may make contracts for a term exceeding one year

       and not exceeding the term of the mayor or president holding office at the time the

       contract is executed, relating to: (1) the employment of a municipal manager ***."

       65 ILCS 5/8-1-7(b) (West 2004).

It is undisputed that a new president took office on May 10, 2005. Thus, Oak Lawn contends

that the second amended agreement, which ran from April 27, 2005, through May 10, 2005,

extended into the term of the new president by at least one day. However, Oak Lawn further

argues that the actual overlaps contemplated by the amended agreements were even greater. As

noted, section XII of the employment agreement stated:

                "In the event a new Agreement is not negotiated and signed until after the

       Agreement has expired, but prior to the running of the thirty (30) days [35 days in

       the second amended agreement] referenced in Section II above, the terms and

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       conditions of this Agreement shall extend until a new Agreement is signed or said

       thirty (30) [or 35] days has passed."

Oak Lawn contends that the first amended agreement violated the Code because, although Faber's

term of employment was scheduled to end April 12, 2005, the 30-day renewal period applicable

to that agreement potentially extended Faber's term of employment until May 12 – three days into

the new president's term. Similarly, Oak Lawn contends that the second amendment was violative

of the Code because, in addition to the one-day overlap resulting from the May 10 end date, the

35-day renewal period actually could have extended Faber's employment well into June of 2005.

       In support of its application of this rule that a village manager's term cannot exceed the

term of a village president, Oak Lawn cites the nineteenth century supreme court case of Milliken

v. County of Edgar, 142 Ill. 528, 32 N.E. 493 (1892). In Milliken, the Edgar County board of

supervisors appointed Milliken steward of the county poorhouse for a term of three years and

agreed to pay him compensation of $1,700 per annum. Milliken, 142 Ill. at 530, 32 N.E. at 493.

Milliken faithfully performed his duties, but less than a year after his appointment, the board of

supervisors discharged him. Milliken, 142 Ill. at 531, 32 N.E. at 493. Milliken brought an action

of assumpsit which the trial court dismissed, and the appellate and supreme courts affirmed.

Milliken, 142 Ill. at 531, 32 N.E. at 493. In reaching its decision, the supreme court noted that

the creation of poorhouses and the appointment of poorhouse keepers was a power conferred on

the counties by statute. Milliken, 142 Ill. at 532, 32 N.E. at 493. The court also noted, however,

that although the statute did not place a time limit on the time for which the keeper of the

poorhouse could be appointed by the county board, the term of the board members themselves

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was only one year. Milliken, 142 Ill. at 532, 32 N.E. at 494. The court then concluded:

       "In view of these provisions of the statute it would be an unreasonable

       construction of the statute relied upon, to hold that the legislature intended to

       clothe the board with authority to enter into a contract with the keeper of a poor

       house to run for the term of three years. If the board had the power to enter into a

       binding contract of this character for three years, no reason is perceived why it

       might not make a contract for five or even ten years, and if this could be done, the

       hands of succeeding boards would be tied and their powers taken from them. If

       this important power, the supervision of a poor farm and the care of the

       unfortunate, may be so far delegated as was attempted in this case, the county

       might be deprived in a great measure of one of the most important affairs intrusted

       to its care and supervision." Milliken, 142 Ill. at 532-33, 32 N.E. at 494.

       Milliken has been invoked in the more recent the cases of Grassini v. DuPage Township,

279 Ill. App. 3d 614, 665 N.E.2d 860 (1996), and Cannizzo v. Berwyn Township 708

Community Mental Health Board, 318 Ill. App. 3d 478, 741 N.E.2d 1067 (2000), and Oak Lawn

additionally looks to these decisions to support its position that the Faber's employment

agreements are void. In Grassini, plaintiff entered into an employment contract with DuPage

Township to serve in the capacity of township administrator for a four-year period. Grassini, 279

Ill. App. 3d at 617, 665 N.E.2d at 862. The contract provided that Grassini's employment could

be terminated only for "various enumerated reasons." Grassini, 279 Ill. App. 3d at 617, 665

N.E.2d at 862. However, approximately three months after the execution of the contract, newly

                                                 20
No. 1-06-2622

elected trustees, including a new township supervisor, replaced the trustees who had authorized

Grassini's contract, and they voted to terminate plaintiff. Grassini, 279 Ill. App. 3d at 617, 665

N.E.2d at 862.

        Upon plaintiff's appeal, the appellate court cited Milliken and held that townships, like

municipalities, "may not contract to employ persons for terms greater than the period for which

the board making the decision has left to serve." Grassini, 279 Ill. App. 3d at 620, 665 N.E.2d at

864. The court concluded that plaintiff's contract was void ab initio and explained: "each

successive township board should decide for itself which employees are necessary and what their

compensation should be." Grassini, 279 Ill. App. 3d at 620, 665 N.E.2d at 864.

        Similarly, in Cannizzo, plaintiff brought suit against his former employer, the Berwyn

Mental Health Board, for breach of his employment contract. Cannizzo, 318 Ill. App. 3d at 479,

741 N.E.2d at 1068. In 1993, plaintiff entered into a written employment contract with the board

for a term of three years. Cannizzo, 318 Ill. App. 3d at 479, 741 N.E.2d at 1068. The contract

stated that if neither party gave notice of an intent to terminate the contract by a certain date, it

would renew for an additional three years. Cannizzo, 318 Ill. App. 3d at 479, 741 N.E.2d at

1068. Approximately one year later, the parties executed another employment contract that

mirrored the earlier contract except for the dates. Cannizzo, 318 Ill. App. 3d at 480, 741 N.E.2d

at 1068. Prior to the end of the three-year term of the second contract, the board terminated

plaintiff for insubordination and plaintiff then brought his breach of contract claims. Cannizzo,

318 Ill. App. 3d at 479-80, 741 N.E.2d at 1068. The board moved to dismiss plaintiff's

complaint, arguing that it did not have authority to enter into either of the contracts because the

                                                  21
No. 1-06-2622

contracts' terms were longer than the term of the Board, which was a maximum of two years, due

to the staggered terms of its members. Cannizzo, 318 Ill. App. 3d at 480, 741 N.E.2d at 1069.

Consequently, the board argued that the contracts were ultra vires and void ab initio. Cannizzo,

318 Ill. App. 3d at 480, 741 N.E.2d at 1069.

        The appellate court cited Millikin and Grassini for "the broad proposition that it is

contrary to the effective administration of a political subdivision to allow elected officials to tie

the hands of their successors with respect to decisions regarding the welfare of the subdivision."

Cannizzo, 318 Ill. App. 3d at 482-83, 741 N.E.2d at 1071. The court further noted that this rule

is codified in section 8-1-7(b), which as noted above, states that municipalities "may make

contracts for a term exceeding one year and not exceeding the term of the mayor or president

holding office at the time the contract is executed." 65 ILCS 5/8-1-7(b) (West 2004). The court

then went on to review decisions from several other jurisdictions to illustrate that the rationale

behind the rule is to prohibit existing governmental bodies from unduly binding their successors.

Cannizzo, 318 Ill. App. 3d at 484-85, 741 N.E.2d at 1072, citing Rawlins v. Levy Court of Kent

County, 235 A.2d 840, 841 (Del. 1967) (appointment on the eve of the expiration of the levy

court's term was an illegal attempt to deprive its successor of the power to direct and control the

office); Zerr v. Tilton, 224 Kan. 394, 400 (1978) (" ' "And the test generally applied is whether

the contract at issue, extending beyond the term, is an attempt to bind successors in matters

incident to their own administration and responsibilities or whether it is a commitment of a sort

reasonably necessary to protection of the public property, interests or affairs being administered.

In the former case the contract is generally held invalid and in the latter case valid." ' [Citation.]");

                                                   22
No. 1-06-2622

Mariano & Associates, P.C., v. Board of County Commissioners of the County of Sublette, 737

P.2d 323, 329 (Wyo. 1987) (" 'The true test is whether the contract itself deprives a governing

body, or its successor, of a discretion which public policy demands should be left unimpaired. ***'

[Citation.]" " 'If *** the contract is for the performance of personal or professional services for

the employing officers, their successors must be allowed to choose for themselves those persons

on whose honesty, skill and ability they must rely.***' [Citation.]"). The Cannizzo court then

held the employment contract in its case was void ab initio because "a township board may not

contract to employ persons for terms greater than the period for which the board and township

supervisor making the decision have left to serve." Cannizzo, 318 Ill. App. 3d at 487, 741 N.E.2d

at 1074.

       Oak Lawn argues that the instant case is like Milliken, Grassini, and Cannizzo and

contends that we must, therefore, declare Faber's amended employment agreements void ab initio

and order him to return the monies he received as severance pursuant to those void contracts.

We, however, find dispositive differences between the facts of this case and those involved in the

aforementioned cases. Unlike in the cases cited by Oak Lawn where the impositions into the new

officials' terms of office were for a matter of years, the longest overlap possible in this case was

for approximately one month and was for the specific purpose of providing for continued service

from Faber until new service could be secured, either from him or from someone else. But even

more overridingly, despite the stated terms in the agreements and despite their renewal periods,

Faber was at all times terminable at will. Therefore, regardless of any potential overlap into the

new board's term, the new officials were never bound to employ Faber, and had Faber not been

                                                  23
No. 1-06-2622

terminated by the outgoing board, the new board would have been free to terminate him. As

expressed in Milliken, Grassini, and Cannizzo, the problem with contracting beyond the term of

the existing governing body is that the new body will be unable to make the decisions and use the

discretion for which it was elected. This problem was never a risk under the agreements in this

case because Faber was always terminable at will; neither the outgoing board nor the new board

was ever in a position where it had to employ Faber against its better judgment.

       Oak Lawn, however, contends that section XII of the employment agreements did, in fact,

potentially bind future boards because the renewal period is expressed in mandatory terms. As

noted, section XII states:

                "In the event a new Agreement is not negotiated and signed until after this

       Agreement has expired, but prior to the running of the thirty (30) [or 35 for

       second amended agreement] days referenced in Section II above, the terms and

       conditions of this Agreement shall extend until a new Agreement is signed or said

       thirty (30) days has passed." (Emphasis added.)

Thus, according to Oak Lawn, because this clause contains the direction "shall," it must be

construed as depriving the board of the option to terminate Faber during the pendency of the

renewal period. In other words, Oak Lawn argues that the new board, coming to office during

this 30- or 35-day renewal period, would not be able to terminate Faber at will but would have to

either renew Faber's employment or continue to employ Faber until the 30 or 35 days ran out.

       We find this construction of section XII of the agreement inconsistent with the

unequivocally expressed intent of the parties in the agreement that Faber's employment be

                                                 24
No. 1-06-2622

terminable at will. It is a basic tenet of contract construction that contracts are to be read as a

whole and that each part is to be read in light of the others. Schiro v. W.E. Gould & Co., 18 Ill.

2d 538, 542-43, 165 N.E.2d 286, 289 (1960) ("It is axiomatic that contracts must be construed to

give effect to the intention of the parties as expressed in the agreement, and to this end the

contract should be construed as a whole, giving effect to every portion of the instrument and

preferring that construction which renders the agreement legal rather than void"); Wilson v.

Wilson, 217 Ill. App. 3d 844, 850, 577 N.E.2d 1323, 1327 (1991). Here, Oak Lawn urges us to

determine that the use of the word "shall" in section XII overrides the clear expression in section I

of the agreement that the board can "at any time" terminate Faber's employment. However, Oak

Lawn's interpretation of the contract creates a conflict where none need exist. Section XII's

statement that the agreement "shall extend until a new agreement is signed or said 30 [or 35] days

has passed" addresses a situation where the parties have, as yet, failed to take any action with

regard to Faber's continued employment; however, it does not express any intent to preempt the

board's right to affirmatively take the action of terminating Faber "at any time." Rather, this

section is easily reconciled with section I's "terminable at will" provision by interpreting it as

merely allowing for a continuation of the status quo and uninterrupted service from Faber while

giving the parties time to reach a new agreement. Thus, if the parties were to fail to act before

the last date of the agreement, Faber's employment would continue until the expiration of the

renewal period. However, this did not restrict the parties from reaching a new agreement during

the renewal period; nor did it restrict the board from terminating Faber pursuant to its ongoing

authority to exercise its discretion with regard to employing Faber.

                                                  25
No. 1-06-2622

       Oak Lawn, however, contends that in his answer to the complaint and subsequent

interrogatories, Faber took the position that his term did actually extend into June. Oak Lawn

thus argues that Faber's answers constituted a binding admission that his term extended past that

of the president, making the contract void.

       Paragraph 6 of Oak Lawn's complaint states:

                "The First Amended Agreement expired on April 12, 2005. *** On or

       about April 27, 2005, the Board of Trustees and the Defendant entered into the

       [second amended agreement]. By virtue of [the second amended agreement], the

       term of the Agreement was extended from the first regular Village Board meeting

       in April, 2005 to May 10, 2005. The extension was for approximately 30 days

       (the Thirty Day Extension).

Faber answered this paragraph as follows:

                "Defendant Faber admits the first sentence of Paragraph 6, except that

       Plaintiff [Oak Lawn] could, within 30 days of the expiration of the term of the

       Agreement, renew the Agreement to retain the services of Defendant. On April

       27, 2005, before the 30-day period expired, Plaintiff and Defendant executed the

       [second amended agreement]. Defendant admits the second sentence of Paragraph

       6. Defendant denies the third and fourth sentences of Paragraph 6."

Faber then gave the following answers to the following interrogatories:

                "[Interrogatory:] With regard to your Answer to Paragraph 6 of the

       Complaint, set forth with specificity each and every fact on which you rely in

                                                26
No. 1-06-2622

       denying that "by virtue of the [second amended agreement], the term of the

       Agreement was extended from the first regular village Board meeting in April,

       2005 to May 10, 2005."

                "Answer: The clause in question is not strictly true because the "term" of

       the contract can be examined in two ways. The plaintiff's position, apparently, is

       that the term is only the term described in Article I of the agreement. However,

       Article XII also describes the term of the agreement, and supersedes the

       contradictory language in Article I, to the effect that the term of the contract

       extends for an additional thirty days in to June of 2005 under certain

       circumstances."

                "[Interrogatory:] With regard to your Answer to Paragraph 6 of the

       Complaint, set forth with specificity each and every fact on which you rely in

       denying that "the extension was for approximately 30 days (the 'Thirty Day

       Extension.')."

                "Answer: Because of the triggering of Article XII of the agreement, the

       contract was actually extended until June, 2005."

       However, contrary to Oak Lawn's assertion, even if these answers could be construed as

admissions by Faber that the actual term of his employment extended beyond May 10, 2005, he

cannot be bound by them since such admissions would be to a conclusion of law properly left to

the court. Avery v. State Farm Mutual Automobile Insurance Co., 216 Ill. 2d 100, 129, 835

N.E.2d 801, 821 (2005) ("As a general rule, the construction, interpretation, or legal effect of a

                                                 27
No. 1-06-2622

contract is a matter to be determined by the court as a question of law"); Charter Bank & Trust

of Illinois v. Edward Hines Lumber Co., 233 Ill. App. 3d 574, 579, 599 N.E.2d 458, 462 (1992)

("A party is not bound by admissions regarding conclusions of law, since it is the province of the

trial court to determine, based upon properly admitted evidence, the legal effect of the facts

adduced"); People ex rel. Department of Public Health v. Wiley, 348 Ill. App. 3d 809, 819, 810

N.E.2d 614, 623 (2004).

       In any event, Faber's answers do not strictly admit to a construction of the contract that

would be violative of the rule that his term not exceed that of the president. With regard to his

denial of the allegation that "by virtue of the [second amended agreement], the term of the

Agreement was extended from the first regular village Board meeting in April, 2005 to May 10,

2005," Faber posited that "under some circumstances," "the term of the contract extends for an

additional thirty days in to June of 2005 under certain circumstances." This answer does not

purport to assert that the new board would be restricted from terminating Faber until June of

2005. Rather, the answer is correct to the extent that if the circumstances where such that Faber

was not terminated by the outgoing board, and was not subsequently terminated or renewed by

the new board, he would remain employed by virtue of section XII's renewal period until

sometime in June 2005. Similarly, with regard to Faber's denial that the second amendment

extended his term for approximately 30 days (from April12 through May 10), his statement that

the term actually extended into June of 2005 is not technically incorrect since absent any

affirmative action by the board, that is exactly what would have happened. However, as

discussed above, this construction of the contract did not, at any time, deny the board the

                                                 28
No. 1-06-2622

opportunity to terminate Faber at will.

        Along these lines, Oak Lawn additionally contends that the agreements violate the Code's

requirement that the village manager's term be indefinite. Section 5-3-7 of the Code states in

pertinent part:

        "[The municipal manager] shall be appointed without regard to his political beliefs

        and need not be a resident of the city or village when appointed. The manager

        shall be appointed for an indefinite term, and the conditions of the manager's

        employment may be set forth in an agreement. *** The manager may at any time

        be removed from office by a majority vote of the members of the council or the

        board." (Emphasis added.) 65 ILCS 5/5-3-7 (West 2004).

Oak Lawn first argues that Faber's term of employment was not compliant with section 5-3-7's

requirement of indefiniteness for the same reason it violated section 8-1-7, namely, because

section XII prohibited the board from terminating Faber during the renewal period. However, for

the same reasons discussed above, we find this argument unavailing. The renewal period allowed

for a continuation of the status quo for a specific period but it did not prohibit the board from

exercising its right to terminate Faber at will.

        Oak Lawn would further contend, however, that Faber's term was not indefinite in that his

employment contracts were for specific periods of time – the original contract ran from June 1,

1999, through April 24, 2001, the first amended agreement ran from April 24, 2001, through

April 12, 2005, and the second amended agreement ran from April 27, 2005, through May 10,

2005. However, given the fact that Faber's employment was at all times terminable at will, we

                                                   29
No. 1-06-2622

find that his term of employment was, in fact, indefinite. The dates expressed in the agreements

did not guarantee Faber employment for those periods and they did not limit the board's authority

to terminate him; rather, they merely acted to provide a schedule for renewing Faber's

employment if the board were to so choose. Section 5-3-7, itself, states that the "conditions of

the manager's employment may be set forth in an agreement." 65 ILCS 5/5-3-7 (West 2004).

Here, the conditions of Faber's employment included that he would become entitled to severance

pay if he was terminated or if his employment was not periodically renewed. Section 5-3-7, also

specifically states that the municipal manager "may at any time be removed from office by a

majority vote of the members of the *** board." 65 ILCS 5/5-3-7 (West 2004). The agreements

in this case are in full compliance with this section because Faber's employment was always

subject to approval of the board and he could be removed at any time. These facts, despite the

recitation of specific dates within the agreements, clearly made Faber's term of employment

"indefinite."

        We finally note that in addition to denying Oak Lawn's motion for summary judgment and

granting Faber's motion with regard to each of Oak Lawn's counts, the circuit court also granted

Faber's motion for summary judgment on his affirmative defenses – waiver and voluntary

payment. Faber argues that since the new board (which consisted of at least one member who

also sat on the old board) approved the payment of his entire severance over a period of

approximately nine months, it should now be prohibited from seeking its return. However, since

we find that Oak Lawn's claims fail as a matter of law, we need not additionally address whether

Oak Lawn is prohibited from contesting the severance payments through the doctrines of waiver

                                                30
No. 1-06-2622

or voluntary payment.

                                       III. CONCLUSION

       For all the foregoing reasons, the judgment of the circuit court is affirmed.

       Affirmed.

       McBRIDE, P.J., and McNULTY, J., concur.

                                                31