Court Opinion

ID: 3135559
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:38:58.460452+00
Date Added: 2024-06-11T11:54:11.296469
License: Public Domain

Docket No. 108673.

                              IN THE
                      SUPREME COURT
                                 OF
                 THE STATE OF ILLINOIS

STATE BUILDING VENTURE, Appellee, v. MAUREEN
O’DONNELL, as Acting Director of the Illinois Department of
        Central Management Services, Appellant.

                 Opinion filed November 18, 2010.

   CHIEF JUSTICE KILBRIDE delivered the judgment of the court,
with opinion.
   Justices Freeman, Thomas, Garman, Karmeier, Burke, and Theis
concurred in the judgment and opinion.

                              OPINION

    State Building Venture (SBV) entered into a lease with the Illinois
Department of Central Management Services (CMS) for space in the
James R. Thompson Building (Thompson Center) in Chicago. The
lease provided for an initial 15-year term, subject to nine 5-year
renewals. The issue in this appeal is whether SBV’s claim for
declaratory judgment is barred by collateral estoppel, by sovereign
immunity or, whether the enabling statute requires the Director to
determine whether the lease is in the best interests of the state at the
time of each renewal.
     This is the second case filed by SBV seeking a declaration of its
rights under the lease. The circuit court of Cook County denied
CMS’s motion to dismiss count III of the complaint and entered
judgment for SBV on the pleadings. The appellate court affirmed. 391
Ill. App. 3d 554. This court granted CMS’s petition for leave to
appeal. 210 Ill. 2d R. 315. We reverse and remand with instructions.

                          I. BACKGROUND
   The enabling statute for leasing commercial space in the
Thompson Center provides, in relevant part:
           “Portions or all of the commercial space, which includes
       the sub-basement, storage mezzanine, concourse, and ground
       and second floors of the James R. Thompson Center *** may
       be leased *** for terms not to exceed 15 years subject to
       renewals when in the judgment of the Director those leases or
       subleases will be in the best interests of the State.” 20 ILCS
       405/405–315(a)(s) (West 2006).
   In 1983, the parties entered into a lease for space in the Thompson
Center. The lease provides, in pertinent part:
           “The initial term of this lease shall be 15 years.
                                  ***
           Tenant shall have the option to renew this lease beyond
       the initial term, on all of the same terms and conditions as are
       contained in this lease for one renewal period of five years
       ***, and Tenant shall have the further option to renew this
       lease beyond such renewal period, on all the same terms and
       conditions as are contained in this lease, for eight additional
       renewal periods of five years each.”
   In 2006, SBV filed suit against CMS. That lawsuit sought a
declaratory judgment concerning SBV’s rights under the lease. CMS
moved to dismiss SBV’s complaint as barred by sovereign immunity
and because the case was moot. The circuit court dismissed the
complaint with prejudice, explaining:
       “The complaint that we have presented here seeks declaratory
       judgment asking the Court to determine the rights and
       obligations under the lease agreement. I find that there is not

                                 -2-
         an actual controversy for the Court to decide *** the
         underlying facts and issues for the declaratory judgment was
         terminated without penalty to the parties rendering the issue
         moot. *** There is no current need for the resolution of a
         controversy. Therefore, the ultimate declaratory judgment by
         [SBV] will be an advisory opinion. Contrary to the allegation
         that [SBV] has unfettered discretion to terminate the lease,
         there is language that addresses that in the lease and the
         enabling legislation. For that issue, if it arises later, I would
         suggest to the parties that the proper avenue will be the Court
         of Claims pursuant to 705 ILCS 505/8 of the Court of Claims
         jurisdiction. So I’m going to grant the [section 2–619] motion
         to dismiss.”
SBV did not appeal the circuit court’s dismissal of its complaint.
     In 2007, SBV filed the lawsuit that is the subject of this appeal.
Two of the counts alleged promissory estoppel and equitable estoppel,
and those counts are not at issue here. Only count III of the complaint
is at issue. Count III sought a declaratory judgment, alleging:
              “58. Based on CMS’s new interpretation of the Enabling
         Statute, CMS claims that it was not authorized to enter into
         the Lease with SBV that allows for nine automatic renewal
         periods.
              59. CMS’s new interpretation of the enabling Statute is
         pretextual and does violence to the plain meaning of the
         statute, to the terms of the Lease, and to the long-settled
         interpretation of the parties to the Lease that recognized that
         the Tenant has the sole, unfettered right to determine whether
         to terminate the Lease at the end of each such renewal period
         (other than at the end of the seventh and eighth extensions).
              60. *** SBV has been and continues to be damaged by
         CMS’s new interpretation of the Enabling Statute.
              WHEREFORE, SBV asks that the Court enter a
         declaratory judgment finding that the Enabling Statute
         authorized the State to enter into the Lease with SBV, that the
         Lease is binding according to its terms, including options to
         renew for successive terms to 2044, and that the Court award

                                   -3-
         SBV its costs, expenses and attorneys fees, and provide such
         other and further relief as justice requires.”
    CMS filed a motion to dismiss the complaint pursuant to sections
2–619(a)(1) and (a)(4) of the Code of Civil Procedure (Code) (735
ILCS 5/2–619(a)(1), (a)(4) (West 2006)). CMS argued that SBV’s
complaint was barred by sovereign immunity, was unripe, and was
precluded by dismissal of the first lawsuit. The circuit court found that
the first suit was dismissed solely because it was moot and that the
judge’s suggestion that the matter belonged in the Court of Claims did
not preclude SBV from bringing suit again in the circuit court. The
court granted CMS’s motion in part, dismissing the promissory
estoppel and equitable estoppel counts, but denying the motion on
count III, the declaratory judgment action.
    Subsequently, the parties filed cross-motions for judgment on the
pleadings pursuant to section 2–615 of the Code (735 ILCS 5/2–615
(West 2006)). The circuit court granted SBV’s motion and denied
CMS’s motion. The court interpreted the statute as providing that the
five-year renewals occurred automatically at SBV’s sole discretion.
    CMS appealed, and the appellate court affirmed. The appellate
court held that the “officer suit exception” to sovereign immunity
applied because the complaint “sought an interpretation of [section
405–315(a)] that authorized CMS to enter into the lease and sought
to enjoin the Director from acting in derogation of her authority in the
future contrary to the provision in the statute.” 391 Ill. App. 3d at
558. The appellate court also held that the suit was ripe and not
precluded by dismissal of SBV’s first suit because the issues were not
identical, the first case was dismissed as moot, and the merits of the
issue of interpretation of the enabling statute was not reached. 391 Ill.
App. 3d at 560-61. Justice Hoffman dissented on the ground that the
complaint “is an action against the State for declaratory relief founded
upon a contract and is, therefore, barred by the doctrine of sovereign
immunity.” 391 Ill. App. 3d at 564 (Hoffman, J., dissenting). Justice
Hoffman concluded the case should have been dismissed for lack of
jurisdiction. 391 Ill. App. 3d at 564 (Hoffman, J., dissenting).

                                  -4-
                             II. ANALYSIS
    In this appeal, CMS contends that SBV’s claim for declaratory
judgment, contained in count III of SBV’s complaint, should have
been dismissed because it was barred by sovereign immunity and
collateral estoppel. CMS argues, in the alternative, that the enabling
statute requires the Director to determine whether the lease is in the
best interests of the state at the time of each renewal.
    This appeal comes before the court on the circuit court’s grant of
judgment on the pleadings in favor of plaintiff, pursuant to section
2–615 of the Code (735 ILCS 5/2–615 (West 2006)). The grant of a
judgment on the pleadings is reviewed de novo. Pekin Insurance Co.
v. Wilson, 237 Ill. 2d 446, 455 (2010). “A motion for judgment on the
pleadings is, like a motion for summary judgment, limited to the
pleadings.” Pekin, 237 Ill. 2d at 455. A trial court properly grants a
judgment on the pleadings when the pleadings disclose no genuine
issue of material fact and the movant is entitled to judgment as a
matter of law. Pekin, 237 Ill. 2d at 455. “ ‘For purposes of resolving
the motion, the court must consider as admitted all well-pleaded facts
set forth in the pleadings of the nonmoving party, and the fair
inferences drawn therefrom.’ ” Pekin, 237 Ill. 2d at 502, quoting
Employers Insurance of Wausau v. Ehlco Liquidating Trust, 186 Ill.
2d 127, 138 (1999). We now consider whether the circuit court erred
in granting a judgment on the pleadings in favor of plaintiff.

                          A. Collateral Estoppel
     We first address CMS’s argument that SBV’s complaint is barred
by collateral estoppel and that SBV cannot now overcome its prior
failure to appeal the dismissal of its first lawsuit by filing the instant
complaint. CMS claims that the circuit court in the first lawsuit held
that it lacked subject matter jurisdiction and that the issue is identical
to the jurisdictional issue presented in this suit. SBV counters that the
circuit court’s dismissal was based on mootness, not subject matter
jurisdiction, and that the issue of sovereign immunity was not decided
on the merits in the first case.
     The applicability of the doctrine of collateral estoppel is a question
of law that we review de novo. In re A.W., 231 Ill. 2d 92, 99 (2008).
The doctrine of collateral estoppel prevents the relitigation of issues

                                   -5-
resolved in earlier causes of action. Du Page Forklift Service, Inc. v.
Material Handling Services, Inc., 195 Ill. 2d 71, 77 (2001). There are
three requirements for application of collateral estoppel:
         “(1) the issue decided in the prior adjudication is identical with
         the one presented in the suit in question, (2) there was a final
         judgment on the merits in the prior adjudication, and (3) the
         party against whom estoppel is asserted was a party or in
         privity with a party to the prior adjudication.” Gumma v.
         White, 216 Ill. 2d 23, 38 (2005).
Moreover, “[f]or purposes of applying the doctrine of collateral
estoppel, finality requires that the potential for appellate review must
have been exhausted.” Ballweg v. City of Springfield, 114 Ill. 2d 107,
113 (1986).
    We have reviewed the transcript of the circuit court’s dismissal of
the first suit, and we conclude that the circuit court dismissed SBV’s
claim as moot. The circuit court specifically found
         “that there is not an actual controversy for the Court to decide
         *** the underlying facts and issues for the declaratory
         judgment was terminated without penalty to the parties
         rendering the issue moot.”
Here, the first lawsuit was moot because there was no controversy
and the trial court could not, therefore, have properly ruled on the
merits of the claim. Therefore, the issue decided in the first case
(mootness) is not identical with the one presented in this case
(whether sovereign immunity bars plaintiff’s claim). In addition, the
circuit court merely “suggest[ed]” in the first case that if the
controversy arose again, the issue should be brought in the Court of
Claims. However, the circuit court did not make a determinative
decision on the merits of SBV’s claim. Accordingly, there was no final
judgment on the merits concerning SBV’s claim in the first lawsuit.
We agree with the circuit court and appellate court that SBV’s present
claim is not barred by collateral estoppel.

                       B. Sovereign Immunity
    We now address the merits of CMS’s argument that SBV’s claim
for declaratory judgment is barred by sovereign immunity. The
doctrine of sovereign immunity “ ‘protects the State from interference

                                   -6-
in its performance of the functions of government and preserves its
control over State coffers.’ ” Senn Park Nursing Center v. Miller, 104
Ill. 2d 169, 188 (1984), quoting S.J. Groves & Sons Co. v. State, 93
Ill. 2d 397, 401 (1982).
     The Illinois Constitution of 1970 abolished the doctrine of
sovereign immunity “[e]xcept as the General Assembly may provide
by law.” Ill. Const. 1970, art. XIII, §4. The General Assembly
subsequently reestablished sovereign immunity in the State Lawsuit
Immunity Act (745 ILCS 5/0.01 et seq. (West 2006)). Our
determination of whether sovereign immunity bars SBV’s claim
requires interpretation of the State Lawsuit Immunity Act and the
Court of Claims Act. The construction of a statute is a question of law
that we review de novo. Murray v. Chicago Youth Center, 224 Ill. 2d
213, 228 (2007).
     In construing a statute, “ ‘[o]ur primary objective is to ascertain
and give effect to legislative intent.’ ” Blum v. Koster, 235 Ill. 2d 21,
29 (2009), quoting People v. Perry, 224 Ill. 2d 312, 323 (2007).
“ ‘[T]he surest and most reliable indicator of [legislative intent] is the
statutory language itself, given its plain and ordinary meaning.’ ”
Koster, 235 Ill. 2d at 29, quoting Perry, 224 Ill. 2d at 323. “In
determining the plain meaning of statutory terms, we consider the
statute in its entirety, the subject it addresses, and the apparent intent
of the legislature in enacting it.” Koster, 235 Ill. 2d at 29. “When the
statutory language is clear and unambiguous, we must apply it as
written, without resort to extrinsic aids of statutory construction.”
Koster, 235 Ill. 2d at 29. If, however, the language of a statute is
ambiguous, we must construe the statute to avoid rendering any part
meaningless or superfluous. People v. Jones, 214 Ill. 2d 187, 193
(2005). “We do not depart from the plain language of the statute by
reading into it exceptions, limitations, or conditions that conflict with
the expressed intent.” Koster, 235 Ill. 2d at 29. We now examine the
plain language of the State Lawsuit Immunity Act and the Court of
Claims Act.
     Section 1 of the State Lawsuit Immunity Act provides “[e]xcept
as provided in [an act to create] the Court of Claims *** the State of
Illinois shall not be made a defendant or party in any court.” 745 ILCS
5/1 (West 2006). Section 8(b) of the Court of Claims Act provides
that the Court of Claims shall have exclusive jurisdiction over “[a]ll

                                   -7-
claims against the State founded upon any contract entered into with
the State of Illinois.” 705 ILCS 505/8(b) (West 2006).
     Here, the State Lawsuit Immunity Act clearly and unambiguously
provides that the “State of Illinois shall not be made a defendant or
party in any court,” except as provided in the Court of Claims Act.
The Court of Claims Act, in turn, clearly and unambiguously provides
that the Court of Claims has exclusive jurisdiction over “[a]ll claims
against the State founded upon any contract entered into with the
State of Illinois.” Based on the clear directives of these statutes, there
is no dispute that claims against the state founded on a contract must
be filed in the Court of Claims. We now consider application of these
statutes to the case at hand.
     The first step in our analysis is to determine whether the claim
brought against the Director of CMS constitutes an action “against the
State founded upon [a] contract entered into with the State” within
the meaning of section 8(b) of the Act. The determination of whether
an action is founded on a contract and brought against the state
“depends upon the issues involved and the relief sought.” Sass v.
Kramer, 72 Ill. 2d 485, 490-91 (1978).
     Here, the basis of SBV’s complaint is the commercial lease
entered into between the State of Illinois and SBV. The parties do not
dispute that SBV’s claim is “founded upon [a] contract entered into
with the State of Illinois” and that the subject matter of the contract
is the lease between the parties. We agree with the parties that SBV’s
claim is based on its contract with CMS. Therefore, the requirement
that the claim be “founded upon any contract entered into with the
State of Illinois” has been met for purposes of section 8(b) of the
Court of Claims Act (705 ILCS 505/8(b) (West 2006)).
     Next, we examine whether SBV’s claim is brought against the
state and, therefore, subject to sovereign immunity, requiring the claim
to be brought in the Court of Claims pursuant to section 8(b) of the
Court of Claims Act (705 ILCS 505/8(b) (West 2006)). The parties
dispute whether SBV’s claim is brought against the state or against
the Director, as an officer of CMS.
     CMS contends that SBV’s declaratory judgment action seeks to
resolve its renewal rights under the lease it entered into with the state
and, therefore, the action is one against the state. According to CMS,

                                   -8-
the fact that SBV sued the Director of CMS, in the Director’s official
capacity, further establishes that SBV seeks relief from the state.
     SBV contends that the “officer suit exemption” applies because
the claim is not a present claim that could subject the state to liability.
According to SBV, the “officer suit exemption” to sovereign
immunity applies when a plaintiff’s claim is based on allegations that
a state agency or official is acting under an assumption of authority
that the agency or official lacks. Thus, SBV argues that the lawsuit is
not against the state.
     SBV cites Bio-Medical Laboratories, Inc. v. Trainor, 68 Ill. 2d
540 (1977), in support of its argument that its claim is not barred by
sovereign immunity. CMS argues that Bio-Medical Laboratories is
distinguishable. In Bio-Medical Laboratories, suit was brought by a
corporation seeking an injunction to stop the Director of Public Aid
from suspending it from participating in the Illinois medical assistance
program. The Director had not actually taken action to suspend the
corporation’s participation in the program at the time the lawsuit was
filed, but the Director did indicate an intention to do so. This court
held that sovereign immunity did not bar the action because the
corporation was not “attempting to enforce a present claim against the
State but, rather, seeks to enjoin the defendant from taking actions in
excess of his delegated authority and in violation of plaintiff’s
protectable legal interests.” Bio-Medical Laboratories, 68 Ill. 2d at
548.
     We agree with CMS that Bio-Medical Laboratories is
distinguishable. The corporation in Bio-Medical Laboratories sought
an injunction to enjoin the Director of Public Aid from taking an
action that it alleged the Director lacked the authority to do. Here, in
contrast, SBV seeks a declaratory judgment action to determine its
rights under the lease. Thus, SBV’s claim is not a prospective claim
concerning the scope of the Director of CMS’s authority.
     In Landfill, Inc. v. Pollution Control Board, 74 Ill. 2d 541, 552
(1978), cited by SBV, this court held that the plaintiff’s claim that the
Pollution Control Board did not have statutory authority to create a
certain rule was not an action against the state. This court reasoned
that the plaintiff was seeking “a declaration that the Board is taking
actions in excess of its delegated authority.” Landfill, 74 Ill. 2d at
552. We find Landfill distinguishable because, here, SBV’s claim does

                                   -9-
not allege the Director has taken any action in excess of its delegated
authority under the enabling statute.
     SBV also attempts to distinguish PHL, Inc. v. Pullman Bank &
Trust Co., 216 Ill. 2d 250 (2005), relied on by CMS in support of its
argument that sovereign immunity bars SBV’s claim. In PHL, the
plaintiffs brought a breach of contract claim seeking an order to
compel the defendant’s treasurer to close on buy-sell agreements,
acting in excess of the treasurer’s lawful authority. This court held
that PHL’s claim was barred by sovereign immunity because there was
an insufficient link between the general grant of authority and the
specific contract at issue. PHL, 216 Ill. 2d at 263-64. This court
reasoned that the treasurer had relied on the advice of the Attorney
General and that nothing in the grant of the treasurer’s lawful
constitutional authority forbade her from receiving or following the
Attorney General’s advice on a legal matter relating to interpretation
of the agreements. PHL, 216 Ill. 2d at 263-64. SBV argues that it is
not seeking an order to compel the Director of CMS to renew the
lease or to enjoin the Director from breaching the lease. Rather, SBV
is only seeking a declaration of the scope of the Director’s authority
under the enabling statute. Contrary to SBV’s argument, however, we
note that SBV’s complaint alleges that “SBV has been and continues
to be damaged” by CMS’s interpretation of the lease. This allegation
indicates a present claim by SBV. We therefore reject SBV’s
argument that PHL is distinguishable.
     SBV also argues that Senn Park Nursing Center v. Miller, 104 Ill.
2d 169 (1984), supports its argument that sovereign immunity does
not bar its action. In Senn Park, this court held that sovereign
immunity did not bar the plaintiffs’ action to compel the Director of
Public Aid to pay them in accordance with a previously approved state
plan. Senn Park, 104 Ill. 2d at 175-76. This court reasoned that the
state could not “justifiably claim interference with its functions when
the act complained of by plaintiffs is unauthorized by statute.” Senn
Park, 104 Ill. 2d at 188. Senn Park is clearly distinguishable from this
case because the plaintiffs in Senn Park sought prospective injunctive
relief, in the form of an order of mandamus. SBV is not seeking to
prevent the Director from acting in an unauthorized manner. Rather,
SBV is seeking a declaration of its rights under a lease agreement and
the enabling statute.

                                 -10-
     Here, count III of SBV’s complaint purports to seek a declaratory
judgment. Count III, however, seeks a judgment finding that the lease
is binding, including options to renew terms to 2044, and to award
costs, expenses, attorney fees, and provide “such other and further
relief as justice requires.” In effect, count III of SBV’s complaint
seeks a determination of its renewal rights, a claim founded on a
contract entered into between SBV and the state. Additionally, count
III of SBV’s “declaratory judgment action” asks for a finding that “the
Enabling Statute authorized the State to enter into the Lease with
[SBV].” This claim falls squarely within the exclusive jurisdiction of
the Court of Claims.
     The dispute in this case is over CMS’s interpretation of the
enabling statute–an actual controversy relating to CMS’s present
interpretation of CMS’s rights under the terms of the lease. The
complaint also alleges present damage. Accordingly, we hold that
count III of SBV’s complaint is barred by sovereign immunity and the
appellate court and circuit court judgments should be reversed. We
remand this cause to the circuit court with directions to enter an order
dismissing count III of SBV’s complaint. Based on our determination
that the action is barred by sovereign immunity, we need not address
the merits of the declaratory judgment action.

                          III. CONCLUSION
    For the foregoing reasons, we reverse the judgments of the
appellate court and circuit court and remand to the circuit court with
instructions to enter an order dismissing count III of SBV’s complaint.

                            Reversed and remanded with directions.

                                 -11-