Court Opinion

ID: 3135286
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:35:23.222345+00
Date Added: 2024-06-11T11:54:08.403170
License: Public Domain

Docket No. 101718.

                        IN THE
                    SUPREME COURT
                          OF
                 THE STATE OF ILLINOIS

                      ____________________

RICHARD G. KRAUTSACK, Appellee, v. DAVID ANDERSON et
                al., Appellants.

                 Opinion filed December 21, 2006.

   JUSTICE FITZGERALD delivered the judgment of the court,
with opinion.
   Chief Justice Thomas and Justices Freeman, Kilbride, and Garman
concurred in the judgment and opinion.
   Justice Karmeier dissented, with opinion.
   Justice Burke took no part in the decision.

                             OPINION

    Plaintiff, Richard G. Krautsack, brought an action in the circuit
court of Cook County against defendants, Luxury Adventures, Ltd.
(Luxury), a California corporation, and David Anderson, Luxury’s
president and sole shareholder, for breach of contract and violations
of the Consumer Fraud and Deceptive Business Practices Act
(Consumer Fraud Act or Act) (815 ILCS 505/1 et seq. (West 2004)).
Defendants prevailed at trial and subsequently filed a petition seeking
attorney fees and costs pursuant to section 10a(c) of the Act (815
ILCS 505/10a(c) (West 2004)) and Supreme Court Rule 137 (155 Ill.
2d R. 137). The trial court granted plaintiff’s motion to strike
defendants’ fee petition. Both parties appealed. The appellate court
affirmed the trial court’s judgment in favor of defendants on plaintiff’s
complaint, and affirmed the trial court’s order striking defendants’ fee
petition. No. 1–04–2135 (unpublished order under Supreme Court
Rule 23) (Krautsack II). We allowed defendants’ petition for leave to
appeal and now affirm the judgment of the appellate court.

                           BACKGROUND
    On January 9, 1998, plaintiff and three family members embarked
on a two-week, $38,000 safari to East Africa arranged by Luxury.
Although the trip was scheduled during what would ordinarily be the
dry season, plaintiff’s safari experience was marred by heavy rainfall
reportedly due to the phenomenon known as “El Nino.” Upon return
from East Africa, plaintiff contacted Anderson and requested a cash
refund, which Anderson declined. The parties were unable to resolve
their dispute and on September 1, 1998, plaintiff filed suit against
Anderson, seeking a full refund, attorney fees and costs, and punitive
damages. Plaintiff later amended the complaint to add Luxury as a
defendant.
    Count I of the amended complaint alleged a violation of the
Consumer Fraud Act by Anderson. Plaintiff alleged that shortly before
leaving on safari, he obtained information that the countries on the
tour were experiencing heavy rainfall. Plaintiff contacted Luxury and
“was assured by Anderson that the information he had received was
incorrect and that the tour would neither be disrupted nor made more
difficult because of the rain.” Plaintiff claimed these representations
were false and were made in an effort to convince plaintiff not to
postpone the tour. Count II of the amended complaint alleged that
Luxury, as Anderson’s employer, was liable for his fraudulent conduct
under the doctrine of respondeat superior. Finally, count III of the
amended complaint alleged that Luxury breached its contract with
plaintiff “because certain of the designated tour sites could not be
visited, and certain other sites could only be reached with great
difficulty.”
    Defendants moved for summary judgment. Briefly, defendants
argued that Anderson’s statements regarding the weather in Africa

                                  -2-
were not actionable under the Consumer Fraud Act, but even if those
statements were deceptive, they did not proximately cause plaintiff
any injury. According to defendants, the statements were made shortly
before the planned departure date and, under the parties’ contract,
plaintiff could not have cancelled the safari without forfeiting the
entire cost of the trip. Defendants also argued that plaintiff signed a
contract clearly stating that Luxury was not liable for acts of God or
the weather. Finally, defendants claimed entitlement to a reasonable
attorney fee under section 10a(c) of the Act.
    In response, plaintiff argued that material issues of fact regarding
the communications between the parties, the cancellation and refund
provisions of the parties’ contract, and other relevant matters
precluded summary judgment. Plaintiff also refined his theory of
recovery under the Consumer Fraud Act. Although plaintiff still
maintained that defendant Anderson deceived plaintiff when he stated
that the weather in Africa would not adversely affect the safari,
plaintiff now argued that, based on the record generated in discovery,
Anderson had a financial motive for deceiving him and acted out of
“greed and avarice.” According to plaintiff:
            “When [plaintiff] asked for Anderson’s recommendation,
        Anderson found himself in a bind because Anderson had
        already paid his African suppliers in advance for [plaintiff’s]
        trip, and if [plaintiff] postponed, Anderson would lose all of
        that money. *** [I]nstead of being truthful with [plaintiff],
        Anderson lied to him, recommended to plaintiff that he leave
        for Africa on January 9, but not revealing that the reason for
        his recommendation was that he did not want to lose money.
                                   ***
            Anderson’s misrepresentation to [plaintiff] and his
        withholding from [plaintiff] the true basis of his
        recommendation, is actionable because [plaintiff] would
        clearly have acted differently had he known the truth, instead
        of being deceived by Anderson.”
    The trial court granted defendants summary judgment on all three
counts of the amended complaint. With respect to the consumer fraud
counts, the trial court stated in relevant part:

                                  -3-
             “Although [d]efendants’ actions may have been motivated
        by self interest, as they had already forwarded certain non-
        refundable sums to their African suppliers, [d]efendants cannot
        predict the weather in such a harsh tropical environment.
        Defendants are clear that their representations about the
        weather and its effects on their clients’ transportation were
        based purely on their personal experiences as well as those of
        their contacts in the region. There is no possible way that
        these statements could be viewed as fraudulent and deceptive.
        It would be against public policy to hold one liable for acts of
        God. The choice was left to [p]laintiff to cancel the trip–he
        chose not to. Therefore, the Court finds that there is no
        question of fact that [d]efendants did not engage in any
        deceptive act or practice in this case.”
    With respect to the contract count, the trial court ruled that no
evidence was introduced that Luxury had a contractual duty to
recommend that plaintiff postpone his trip, and the evidence that was
presented indicated that Luxury satisfied all of its contractual
obligations. The trial court also noted that damages did not result
directly from Luxury’s action, but were the direct result of inclement
weather, “something obviously outside of Luxury’s control.” The trial
court concluded: “The facts are clear that Luxury used its best efforts
to book a trip for [p]laintiff during the dry season and there have been
no facts presented by [p]laintiff to contradict this.”
    Defendants thereafter filed an amended petition for attorney fees
under section 10a(c) of the Consumer Fraud Act. Section 10a(c)
states that a court “may award *** reasonable attorney’s fees and
costs to the prevailing party.” 815 ILCS 505/10a(c) (West 2004).
Defendants also filed a motion for Rule 137 sanctions, arguing that no
basis in fact or law existed to support plaintiff’s claims. See 155 Ill. 2d
R. 137. The trial court granted the fee petition and the sanctions
motion, assessing fees of $10,499 and costs of $104. Plaintiff
appealed.
    On appeal, plaintiff further refined his theory of recovery under the
Consumer Fraud Act, arguing that the relationship between plaintiff
and defendants was that of principal and agent, and that the
relationship was a fiduciary one. Plaintiff claimed Anderson had a

                                   -4-
conflict of interest when he advised plaintiff to continue with his travel
plans. Plaintiff explained:
         “The source of the conflict was that any recommendation that
         Anderson could make to [plaintiff] could not have benefitted
         both of their respective financial interests. If Anderson advised
         [plaintiff] to postpone his travel plans, then Anderson would
         lose a substantial amount of money. If, on the other hand,
         Anderson advised [plaintiff] to continue with his travel plans,
         then [plaintiff] would travel to Africa during a period of
         torrential rainfall.
             Faced with this conflict, Anderson was obligated, as
         [plaintiff’s] agent, and consistent with his fiduciary duty, to
         subordinate his personal interests to [plaintiff’s] interests and
         to advise [plaintiff] without bias. Alternatively, if Anderson
         was unwilling to subordinate his personal interest, as was the
         case, then Anderson was required to fully disclose this interest
         to [plaintiff].”
Plaintiff also argued on appeal that the record contained substantial
evidence supporting his consumer fraud claim that precluded summary
judgment. In particular, plaintiff cited a March 1998 e-mail from
Anderson to one of the African tour operators in which Anderson
states that plaintiff “did not get what he paid for,” and that Anderson
“was protecting a lot of asses when [he] ‘pushed’ [plaintiff] to
continue with his travel plans.”
    As to the contract count, plaintiff argued, inter alia, that an issue
of disputed fact existed as to whether Luxury could fulfill its
contractual obligations to arrange for a safari in the dry season where
the dry season was so plagued by rainfall that the safari was made
almost impossible to conduct. As to proximate causation, plaintiff
argued that his damages were the direct result of Luxury’s failure to
reschedule the safari and not an act of God.
    The appellate court reversed the grant of summary judgment.
Krautsack v. Anderson, 329 Ill. App. 3d 666 (2002) (Krautsack I). As
to the consumer fraud count, the appellate court noted that “[w]hile
the failure to disclose or concealment of material information by a
travel agent, based on the agent’s fiduciary duty to his clients, is a
novel and uncommon theory, it is not, however, unheard of.”

                                   -5-
Krautsack I, 329 Ill. App. 3d at 677. Reviewing case law from this
jurisdiction and other jurisdictions relative to a travel agent’s duties,
the appellate court concluded that “if an agent has a conflict of interest
or some interest that would be adverse to the client or affect the
client’s decision, the agent must disclose that fact to the client.”
Krautsack I, 329 Ill. App. 3d at 679. The appellate court held that
genuine issues of material fact existed as to whether Anderson failed
to disclose information material to the object of the parties’ agency.
Thus, summary judgment on the consumer fraud claim was improper.
Krautsack I, 329 Ill. App. 3d at 679. The appellate court also held that
material issues of fact existed as to the terms of the contract between
the parties, and that the March 1989 e-mail was sufficient evidence of
a breach to allow the contract claim to proceed to trial. Krautsack I,
329 Ill. App. 3d at 682.
    As to the trial court’s grant of attorney fees and costs under Rule
137, the appellate court concluded that because plaintiff’s causes of
action survived summary judgment, Rule 137 sanctions were not
warranted. Krautsack I, 329 Ill. App. 3d at 684. In other words, no
basis existed for concluding that plaintiff ran afoul of the rule’s
requirement that pleadings, motions and other papers must be well
grounded in fact and law and not interposed for an improper purpose.
155 Ill. 2d R. 137.
    Finally, the appellate court addressed the trial court’s grant of fees
and costs to defendants under section 10a(c) of the Consumer Fraud
Act. Because the appellate court reversed the grant of summary
judgment in favor of defendants, defendants were no longer the
prevailing parties for purposes of section 10a(c), and thus were not
eligible for an award of fees. Although the appellate court could have
reversed the fee award on this basis, the court chose to address
plaintiff’s argument that the award of fees was improper because the
record failed to disclose bad faith on his part. Relying principally on
Casey v. Jerry Yusim Nissan, Inc., 296 Ill. App. 3d 102 (1998), the
appellate court held that an award of statutory fees must be supported
by a finding that the plaintiff acted in bad faith, and that Rule 137
provided the proper standard for bad faith. If the trial court finds bad
faith under this standard, the court can then consider other relevant
factors. Krautsack I, 329 Ill. App. 3d at 685.

                                   -6-
    The appellate court inferred, based on the trial court’s award of
Rule 137 sanctions, that it had found bad faith. Because the appellate
court reversed the grant of Rule 137 sanctions, however, the inference
was no longer valid and no basis existed for awarding fees under the
Consumer Fraud Act. Krautsack I, 329 Ill. App. 3d at 685. The
appellate court reversed the statutory fee award and remanded the
cause to the trial court for further proceedings. Krautsack I, 329 Ill.
App. 3d at 685-86.
    On remand, the case proceeded to a bench trial. Two witnesses
testified: plaintiff and defendant Anderson. The trial court denied
defendants’ motion for a directed finding after the close of plaintiff’s
case in chief, but ultimately entered judgment for defendants on all
counts of the amended complaint. After judgment was entered,
plaintiff learned for the first time that, prior to trial, the California
Attorney General had filed a 34-count felony complaint against
defendant Anderson, charging him with grand theft, failure to return
money, and trust account violations in connection with his safari
business. Based on the documentation provided to plaintiff by the
California Attorney General, plaintiff moved to vacate the judgment
in this case and enter judgment in his favor. Plaintiff argued that
defendant had violated discovery rules by failing to disclose the
California charges and had committed perjury when he testified that
he was not a travel agent.
    The trial court denied the motion to vacate judgment. Although
agreeing with plaintiff that the California charges should have been
disclosed, those charges, as well as Anderson’s subsequent plea of “no
contest” to three of the felony counts, were relevant for impeachment
purposes only and did not establish a ground for vacating the
judgment. The trial court also rejected plaintiff’s claim that Anderson
committed perjury.
    Thereafter, with leave of court, defendants filed their amended
petition for attorney fees pursuant to section 10a(c) of the Consumer
Fraud Act and Rule 137. Defendants sought fees and costs totaling
over $30,000. Plaintiff moved to strike the fee petition. Relying on the
appellate court’s judgment in Krautsack I, plaintiff argued that for
purposes of section 10a(c) of the Act, defendant must first establish
that plaintiff was guilty of bad faith under the standard set forth in
Rule 137, and that defendants’ fee petition, on its face, failed to

                                  -7-
identify any alleged violation of that rule. The trial court granted
plaintiff’s motion to strike:
              “I agree that the Appellate Court decision in this case
         greatly undermines a defendant seeking fees in this case,
         because they discuss the validity of the legal theory that the
         plaintiff was asserting and also held there were material issues
         of fact that precluded entry of summary judgment at that time.
              Even if I don’t strike the *** amended motion for
         attorney’s fees and I consider the merits of the motion for
         fees, I still find that the defendants are not entitled to the fees
         under either the Illinois Consumer Fraud Act or [Rule] 137.
                                     ***
              I don’t think the requisite bad faith or culpability under
         [Rule] 137 has been shown ***.”
Defendants appealed the trial court’s order striking their fee petition;
plaintiff cross-appealed from the trial court’s order granting judgment
in favor of defendants on his consumer fraud and contract claims, as
well as the trial court’s order denying his motion to vacate that
judgment.
     The appellate court held that “the trial court properly struck
defendants’ petition for fees and costs because they failed to satisfy
the requirements of Rule 137.” “[T]here is not a single allegation by
defendants of any false statement by plaintiff in any specific written
document filed with the trial court. *** Additionally, defendants
sought to recover fees and costs incurred for this entire litigation,
which is improper.” The appellate court further held that because
defendants failed to satisfy the requirements of Rule 137, their request
for fees under the Consumer Fraud Act must also fail since defendants
did not show bad faith on plaintiff’s part. No. 1–04–2135
(unpublished order under Supreme Court Rule 23).
     With respect to plaintiff’s cross-appeal, the appellate court held
that the trial court’s judgment on the merits in favor of defendants was
not against the manifest weight of the evidence, and that the trial court
did not err in denying plaintiff’s motion to vacate the judgment. No.
1–04–2135 (unpublished order under Supreme Court Rule 23).
     We allowed defendants’ petition for leave to appeal. 177 Ill. 2d R.
315.

                                    -8-
                               ANALYSIS
                                     I
    Defendants first argue that the appellate court erred in holding that
bad faith is a prerequisite to an award of attorney fees and costs to a
prevailing defendant under section 10a(c) of the Consumer Fraud Act.
Plaintiff counters that this is the same issue defendants litigated and
lost in Krautsack I, and that defendants, having failed to seek review
of Krautsack I in this court, are now precluded from relitigating this
issue under the law of the case doctrine. We disagree.
    Generally, the law of the case doctrine bars relitigation of an issue
previously decided in the same case. People v. Tenner, 206 Ill. 2d
381, 395 (2002). Thus, “the determination of a question of law by the
Appellate Court on the first appeal may, as a general rule, be binding
upon it on the second appeal.” Zerulla v. Supreme Lodge Order of
Mutual Protection, 223 Ill. 518, 520 (1906); accord Tenner, 206 Ill.
2d at 395. Significantly, however, the law of the case doctrine is
inapplicable to this court in reviewing the decision of the appellate
court. Garibaldi v. Applebaum, 194 Ill. 2d 438, 447 (2000); People
v. Triplett, 108 Ill. 2d 463, 488 (1985); Zerulla, 223 Ill. at 520.
Rather, “[s]ince this is the first time this case has been before us, we
may review all matters which were properly raised and passed on in
the course of the litigation.” Triplett, 108 Ill. 2d at 488, citing Relph
v. Board of Education of De Pue Unit School District No. 103, 84 Ill.
2d 436, 442 (1981); accord Garibaldi, 194 Ill. 2d at 447.
Accordingly, we will consider defendants’ argument, raised in
Krautsack I and Krautsack II, that an award of attorney fees to a
prevailing defendant under section 10a(c) of the Act should not be
conditioned upon a finding that the plaintiff acted in bad faith. Before
examining the provisions of the Consumer Fraud Act, we briefly
review the principles of law that guide a court’s interpretation of a
statute.
    The cardinal rule of statutory interpretation is to ascertain and give
effect to the intent of the legislature. In re Donald A.G., 221 Ill. 2d
234, 246 (2006); Kraft, Inc. v. Edgar, 138 Ill. 2d 178, 189 (1990).
The best indication of this intent is the language of the statute, which
must be given its plain and ordinary meaning. Donald A.G., 221 Ill. 2d
at 246; Lucas v. Lakin, 175 Ill. 2d 166, 171 (1997). Where the
language is unambiguous, the statute must be given effect without

                                   -9-
resort to other aids of construction. In re R.L.S., 218 Ill. 2d 428, 433
(2006); Quad Cities Open, Inc. v. City of Silvis, 208 Ill. 2d 498, 508
(2004). In examining a statute, a court must give effect to the entire
statutory scheme. Thus, words and phrases should not be construed
in isolation; rather, they must be interpreted in light of other relevant
portions of the statute. Donald A.G., 221 Ill. 2d at 246; Primeco
Personal Communications, L.P. v. Illinois Commerce Comm’n, 196
Ill. 2d 70, 87-88 (2001). Issues of statutory interpretation are
questions of law which we review de novo. Donald A.G., 221 Ill. 2d
at 246.
     Section 10a(a) of the Consumer Fraud Act authorizes a private
right of action for “[a]ny person who suffers actual damage as a result
of a violation of [the] Act.” 815 ILCS 505/10a(a) (West 2004); Avery
v. State Farm Mutual Automobile Insurance Co., 216 Ill. 2d 100, 179
(2005); Allen v. Woodfield Chevrolet, Inc., 208 Ill. 2d 12, 16-17
(2003). This section also authorizes the court, in its discretion, to
“award actual economic damages or any other relief which the court
deems proper.” 815 ILCS 505/10a(a) (West 2004). Section 10a(c)
supplements section 10a(a) by expressly authorizing, among other
relief, an award of attorney fees and costs. Section 10a(c) states:
             “Except as provided in subsections (f), (g), and (h) of this
         Section,[1] in any action brought by a person under this
         Section, the Court may grant injunctive relief where
         appropriate and may award, in addition to the relief provided
         in this Section, reasonable attorney’s fees and costs to the
         prevailing party.” (Emphasis added.) 815 ILCS 505/10a(c)
         (West 2004).
     The term “prevailing party” encompasses a prevailing defendant,
as well as a prevailing plaintiff. Allen, 208 Ill. 2d at 33-34, citing
Graunke v. Elmhurst Chrysler Plymouth Volvo, Inc., 247 Ill. App. 3d
1015, 1020 (1993); see also Haskell v. Blumthal, 204 Ill. App. 3d
596, 599 (1990). Because section 10a(c) states that the court “may”
award attorney fees and costs, and the word “may” ordinarily

  1
   This court has held subsections (f), (g), and (h), of section 10a(c) of the
Consumer Fraud Act unconstitutional as special legislation. Allen, 208 Ill.
2d at 33.

                                    -10-
connotes discretion (People v. Ullrich, 135 Ill. 2d 477, 484 (1990)),
attorney fee awards are left to the sound discretion of the trial court
(see Haskell, 204 Ill. App. 3d at 600; Tague v. Molitor Motor Co.,
139 Ill. App. 3d 313, 318-19 (1985)).
     In determining whether a trial court abused its discretion, our
appellate court has identified several factors or criteria a trial court
may consider when ruling on a fee petition under section 10a(c).
These factors include, but are not limited to, “(1) the degree of the
opposing party’s culpability or bad faith; (2) the ability of the
opposing party to satisfy an award of fees; (3) whether an award of
fees against the opposing party would deter others from acting under
similar circumstances; (4) whether the party requesting fees sought to
benefit all consumers or businesses or to resolve a significant legal
question regarding the Act; and (5) the relative merits of the parties’
positions.” Graunke, 247 Ill. App. 3d at 1022-23; see also
Washington Courte Condominium Ass’n-Four v. Washington-Golf
Corp., 267 Ill. App. 3d 790, 825-26 (1994). Although this
nonexhaustive list of factors was first identified in a consumer fraud
case involving a fee petition by a prevailing defendant (Haskell, 204
Ill. App. 3d at 600), these factors have been applied in cases involving
fee petitions by both prevailing plaintiffs and prevailing defendants
(see Casey, 296 Ill. App. 3d at 106-09 (prevailing defendants’ fee
petition); Majcher v. Laurel Motors, Inc., 287 Ill. App. 3d 719, 730-
31 (1997) (prevailing plaintiff’s fee petition); Washington Courte
Condominium, 267 Ill. App. 3d at 824-26 (prevailing plaintiffs’ fee
petition)).
     Defendants do not dispute that these factors are relevant to a trial
court’s determination of whether to award fees to a prevailing
defendant under section 10a(c) of the Act. Instead, defendants dispute
the significance of a trial court’s finding that the plaintiff acted in bad
faith. Defendants argue that the plaintiff’s bad faith, if any, is simply
one factor to consider, but is not the controlling factor. We note that
our appellate court is divided as to whether a prevailing defendant
must show bad faith on the part of the plaintiff prior to an award of
attorney fees under section 10a(c). Compare Graunke, 247 Ill. App.
3d at 1021 (holding that a finding of plaintiff’s bad faith is not a
prerequisite to the trial court’s exercise of discretion to award fees),
and Boeckenhauer v. Joe Rizza Lincoln Mercury, 361 Ill. App. 3d

                                   -11-
470, 475 (2005) (rejecting “the notion that a prevailing defendant
must show bad faith on the part of the plaintiff prior to being awarded
attorney fees”), with Casey, 296 Ill. App. 3d at 108 (holding that trial
court must make a threshold finding of plaintiff’s bad faith before
awarding fees to a prevailing defendant), and Haskell, 204 Ill. App. 3d
at 602 (noting the “difficulty in envisioning a circumstance arising
under the [Consumer Fraud] Act where fees should be awarded a
defendant absent bad faith on the part of a plaintiff”).
     In the present case, the appellate court ruled in Krautsack I that
a trial court must first determine whether the plaintiff acted in bad
faith, and only if such finding is made should the trial court analyze the
remaining factors. Krautsack I, 329 Ill. App. 3d at 685, quoting
Casey, 296 Ill. App. 3d at 108. In Krautsack II, the appellate court
adhered to its earlier ruling. No. 1–04–2135 (unpublished order under
Supreme Court Rule 23). Defendants argue that the appellate court’s
decision is contrary to the plain language of section 10a(c) of the Act,
and that the legislature did not intend to establish a different standard
for defendants seeking fees from that applicable to a plaintiff seeking
fees. Plaintiff counters that section 10a(c) does not limit the trial
court’s discretion in awarding fees under the Act, and that requiring
a bad-faith finding where a defendant seeks fees is entirely consistent
with the remedial purposes of the Act.
     Although we agree with defendants that nothing in the plain
language of section 10a(c) conditions a fee award to a prevailing
defendant on a finding that the plaintiff acted in bad faith, we also
agree with plaintiff that section 10a(c) does not expressly restrict a
trial court’s discretion or identify the circumstances under which a fee
petition should be allowed. Thus, our analysis must go beyond the
plain language of section 10a(c). We must examine the fee-shifting
provision in light of the entire statute, keeping in mind the subject the
statute addresses, the legislature’s apparent objective in adopting the
statute, and the evils sought to be remedied. See R.L.S., 218 Ill. 2d at
433; People v. Palmer, 218 Ill. 2d 148, 156 (2006).
     As the full title of the Consumer Fraud Act explains, it is “[a]n Act
to protect consumers and borrowers and businessmen against fraud,
unfair methods of competition and unfair or deceptive acts or
practices in the conduct of any trade or commerce ***.” Pub. Act
78–904, eff. October 1, 1973 (amending the title of the Act and

                                  -12-
adding section 10a, among other amendments); see also Scott v. Ass’n
for Childbirth at Home, International, 88 Ill. 2d 279, 288 (1981) (the
Act “is a regulatory and remedial enactment intended to curb a variety
of fraudulent abuses and to provide a remedy to individuals injured by
them”). In addition to the private right of action section 10a
establishes, the Attorney General is empowered to investigate and
prosecute offenders. 815 ILCS 505/3 through 7 (West 2004); Allen,
208 Ill. 2d at 16. By its own terms, the Act “shall be liberally
construed to effect the purposes thereof.” 815 ILCS 505/11a (West
2004).
     Because individual consumer fraud claims are frequently small, the
attorney fee provision in section 10a(c) ensures that defrauded
consumers will be able to exercise their rights under the statute. Allen,
208 Ill. 2d at 30-31. As we explained in Cruz v. Northwestern
Chrysler Plymouth Sales, Inc., 179 Ill. 2d 271, 279-80 (1997):
         “[I]n consumer fraud cases the attorney fee awards can easily
         constitute the largest part of a plaintiff’s recovery. The
         legislature realized this when it enacted the fee-shifting
         provision of the Consumer Fraud Act. That provision is
         premised on the recognition that plaintiffs would be reluctant
         to seek redress for consumer fraud if the recovery would be
         nearly or completely consumed by attorney fees and was
         designed to encourage plaintiffs who have a cause of action to
         sue even if recovery would be small.”
See also A. Saltzman, A Brief Look at Statutory Attorneys’ Fees in
Illinois, 73 Ill. B.J. 266, 268 (1985) (“Where the legislature has
enacted laws designed to protect the public or to create new rights in
members of the public and has provided for private rights of action
under these laws, it often also provides for fee shifting to ensure that
the private rights of action will be exercised”).
     The legislature’s allowance of fee awards to prevailing defendants
is necessarily motivated by a different concern: “to deter bad-faith
conduct by a plaintiff and to reimburse a defendant when that occurs.”
Haskell, 204 Ill. App. 3d at 602; see also Allen, 208 Ill. 2d at 33
(noting that consumer fraud defendants faced with defending a
frivolous suit may seek recourse under the fee-shifting provision of
section 10a(c)).

                                  -13-
    Limiting a consumer fraud defendant’s ability to recover fees to
instances where the plaintiff acted in bad faith is consistent with the
purpose of the Act. If this limitation did not exist, a prevailing
defendant could be awarded fees simply because the plaintiff, although
having a legitimate claim and proceeding in good faith, lost at trial on
the proofs. The potential for such a penalty would act as a deterrent
to the filing of valid consumer fraud claims. Casey, 296 Ill. App. 3d
at 107. Our duty, of course, is to avoid a construction that would
defeat the statute’s purpose or yield absurd or unjust results. In re
A.P., 179 Ill. 2d 184, 195 (1997).
    Defendants argue that a bad-faith requirement for fee awards to
prevailing defendants unfairly distorts consumer fraud actions in favor
of plaintiffs. According to defendants, the legislature could not have
intended to create a massive incentive for plaintiffs to sue by providing
an almost automatic right to attorney fees, while at the same time
extinguishing any possibility that defendants could recover their fees
unless they demonstrated that the plaintiff acted in bad faith.
    Contrary to defendants’ argument, an attorney fee award to a
prevailing plaintiff is not automatic. A prevailing plaintiff, like a
prevailing defendant, is entitled to petition the court for an award of
attorney fees and costs pursuant to section 10a(c), but the award of
fees is discretionary, not mandatory. See, e.g., Majcher, 287 Ill. App.
3d at 730; Haskell, 204 Ill. App. 3d at 600; Tague, 139 Ill. App. 3d
at 318. Circumstances may exist which militate against an award of
fees to a prevailing plaintiff. See Washington Courte Condominium,
267 Ill. App. 3d at 825 (affirming denial of fee award to the prevailing
plaintiff where the trial found the defendants acted out of “stupidity,”
as opposed to bad faith, and judgment of $1.7 million was a sufficient
deterrent); Tague, 139 Ill. App. 3d at 318-19 (affirming denial of fee
award to the prevailing plaintiff where the plaintiff was awarded
$1,125 in actual damages and $17,000 in punitive damages).
    Although an award of attorney fees to a prevailing plaintiff is not
automatic, we recognize that a prevailing plaintiff is more likely than
a prevailing defendant to recover attorney fees. This result, however,
is not a function of any distortion of statutory language or legislative
intent. Rather, it is a function of the remedial purpose of the Act. That
is, without the ability to recover attorney fees, the protections of the
Act are illusory. Allen, 208 Ill. 2d at 31.

                                  -14-
     Defendants’ argument also overlooks that a prevailing plaintiff has
already proven that the defendant is guilty of consumer fraud. An
award of fees under that circumstance causes defendants “to bear the
full and fair consequences of their illegal conduct” (Warren v. LeMay,
142 Ill. App. 3d 550, 583 (1986)) and fulfills the Act’s laudatory
purpose of protecting consumers’ rights. A prevailing defendant, on
the other hand, has not necessarily established anything more than that
the plaintiff’s efforts at suit were unsuccessful. In light of the
uncertainty of litigation, routinely awarding fees under this
circumstance would discourage consumer fraud plaintiffs from
pursuing their statutory rights, frustrating the legislature’s intent when
it adopted the Act. See Casey, 296 Ill. App. 3d at 107.
     We conclude that a bad-faith requirement for fee awards to a
prevailing defendant, without a corresponding bad-faith requirement
for fee awards to a prevailing plaintiff, is consonant with the purposes
of the Consumer Fraud Act. Thus, where a prevailing defendant
petitions the trial court for a reasonable attorney fee under section
10a(c), only if the trial court makes a threshold finding that the
plaintiff acted in bad faith should the trial court consider other
circumstances relevant to its exercise of discretion. Although a
prevailing plaintiff may seek to demonstrate a defendant’s bad faith,
a plaintiff is not required to do so. Accordingly, a trial court need not
make a threshold finding of bad faith in order to award a plaintiff
attorney fees under section 10a(c) of the Act.

                                  II
    We next consider whether, as the appellate court held, Rule 137
provides the proper standard for judging a party’s bad faith when
considering the propriety of fees under section 10a(c) of the Act. No.
1–04–2135 (unpublished order under Supreme Court Rule 23)
(applying its earlier ruling in Krautsack I, 329 Ill. App. 3d at 685).
Relying on Door Systems, Inc. v. Pro-Line Door Systems, Inc., 126
F.3d 1028 (7th Cir. 1997), defendants argue that the appellate court’s
standard is too narrow.
    In Door Systems, a federal district court awarded attorney fees to
the prevailing defendant in a suit under the Act, treating such award
as an automatic right. The court of appeals recognized that a fee

                                  -15-
award under the Act is not automatic and then sought to clarify the
appropriate standard for fee awards, stating in relevant part:
        “We think it reasonably plain that bad faith is too narrow a
        standard. Even if a suit is brought in good faith, it could be so
        lacking in merit or so burdensome to defend against as to be
        oppressive, in which event the defendant would have a
        powerful equitable claim to recover a reasonable attorneys’
        fee.” Door Systems, 126 F.3d at 1030.
The court of appeals explained that an oppressive suit “was something
that might be described not just as a losing suit but as a suit that had
elements of an abuse of process, whether or not it had all the elements
of the tort.” Door Systems, 126 F.3d at 1031.
    The difference between the oppression standard adopted by the
court of appeals and the bad-faith standard employed by our appellate
court is unclear, and defendants here do not attempt to illuminate the
matter. We note that one federal district court has concluded that
“[a]ny significant distinction between the ‘bad faith’ standard and the
‘oppression’ standard is not overtly apparent.” Janikowski v. Lynch
Ford, Inc., 73 F. Supp. 2d 956, 959 (N.D. Ill. 1999).
    While we are not persuaded that this court should adopt the
rationale of Door Systems, we agree with defendants that the bad-faith
standard, as articulated by the appellate court, is too narrow. As
already noted, the appellate court held that “Rule 137 provides the
proper standard for bad faith” when determining the propriety of fees
under section 10a(c) of the Act. Krautsack I, 329 Ill. App. 3d at 685,
citing Casey, 296 Ill. App. 3d at 108. Rule 137 provides in relevant
part:
        “The signature of an attorney or party [on a pleading, motion
        or other paper] constitutes a certificate by him that he has read
        the pleading, motion or other paper; that to the best of his
        knowledge, information, and belief formed after reasonable
        inquiry it is well grounded in fact and is warranted by existing
        law or a good-faith argument for the extension, modification,
        or reversal of existing law, and that it is not interposed for any
        improper purpose, such as to harass or to cause unnecessary
        delay or needless increase in the cost of litigation. *** If a
        pleading, motion, or other paper is signed in violation of this

                                  -16-
         rule, the court, upon motion or upon its own initiative, may
         impose upon the person who signed it, a represented party, or
         both, an appropriate sanction, which may include an order to
         pay to the other party or parties the amount of reasonable
         expenses incurred because of the filing of the pleading, motion
         or other paper, including a reasonable attorney fee.” 155 Ill.
2d R. 137.
“The purpose of Rule 137 is to prevent abuse of the judicial process
by penalizing claimants who bring vexatious and harassing actions.”
Sundance Homes, Inc. v. County of Du Page, 195 Ill. 2d 257, 285-86
(2001); see also Kingbrook, Inc. v. Pupurs, 202 Ill. 2d 24, 34 (2002)
(identifying Rule 137 as one of the procedures in place to resolve
contentions of bad-faith litigation); Cult Awareness Network v.
Church of Scientology International, 177 Ill. 2d 267, 279 (1997)
(“Rule 137 was adopted as a means of preventing false and frivolous
filings”).
     Because Rule 137 addresses the pleadings, motions and other
papers a litigant files, the rule does not provide a sanction against all
asserted instances of bad faith conduct by a litigant or the litigant’s
attorney during the course of litigation. See In re Marriage of Oleksy,
337 Ill. App. 3d 946, 949 (2003). For example, a party’s pleadings
may conform to Rule 137, yet the party may be guilty of other rule
violations amounting to bad faith. We discern no reason why a
prevailing defendant should be limited by Rule 137 in establishing a
plaintiff’s bad faith. Rule 137, and the body of case law that has
developed around it, provide useful guidance to litigants and judges,
but a defendant’s failure to demonstrate bad faith by the plaintiff under
Rule 137 is not fatal to a prevailing defendant’s fee petition under the
Act. Appellate court opinions which hold to the contrary, including
Krautsack I, are overruled.
     In the present case, the appellate court found that defendants
failed to satisfy the requirements of Rule 137 and held that defendants’
request for fees under the Consumer Fraud Act “was likewise properly
stricken since there was no showing of bad faith on the part of the
plaintiff.” No. 1–04–2135 (unpublished order under Supreme Court
Rule 23). Because defendants were not required to demonstrate bad
faith under Rule 137, defendants’ petition for statutory fees was
improperly stricken.

                                  -17-
     Although we might ordinarily remand this matter to the trial court
to consider defendants’ fee petition anew, we find remand to be
unnecessary. In their response to plaintiff’s motion to strike
defendants’ fee petition, defendants argued: “Assuming this Court
[i.e., the trial court] determines that the Defendants are required to
show bad faith, the Petition for Attorney’s Fees does not require an
evidentiary hearing. *** All of the allegations contained in
Defendants’ Petition for Attorney’s Fees are reflected in the court file,
pleadings and trial record. *** An evidentiary hearing will needlessly
add delay and expenses to this matter.” See also No. 1–04–2135
(unpublished order under Supreme Court Rule 23) (holding that
defendants waived any challenge to the trial court’s failure to hold an
evidentiary hearing). Accordingly, we will conduct our own review of
defendants’ fee petition.

                                    III
    The overriding theme of defendants’ request for attorney fees and
costs under section 10a(c) of the Act is that plaintiff’s suit was
frivolous because it “had nothing to do with consumer fraud,” “but
everything to do with a client that was merely upset because it rained
on a trip.” According to defendants, plaintiff unreasonably, and
without any legal basis, sought to hold them liable for the weather. We
disagree.
    Although the rains in East Africa prior to and during the safari
formed part of the backdrop for the present litigation, plaintiff was
not, contrary to defendants’ argument, seeking to hold defendants
liable for the inclement weather. Rather, as the appellate court
observed in Krautsack I:
        “[Plaintiff] maintains that it is not his position *** that
        Anderson and Luxury Adventures were responsible for the
        weather, but, rather, his position is that Anderson and Luxury
        Adventures failed to disclose their personal interest in having
        [plaintiff] not postpone the trip.
            ***
            Substantively, [plaintiff]’s claim is based on Anderson’s
        failure to disclose certain facts with respect to his motives and

                                  -18-
         interests based on his fiduciary duty to [plaintiff].” Krautsack
         I, 329 Ill. App. 3d at 676.
The appellate court recognized that plaintiff’s theory of recovery,
although “uncommon,” was “not *** unheard of.” Krautsack I, 329
Ill. App. 3d at 677. We thus decline to find that plaintiff’s suit was
frivolous.
     As a further basis for statutory fees, defendants argued that
plaintiff, in his memorandum in support of his motion to vacate the
judgment order, “falsely alleged that David Anderson was personally
involved in any fraudulent activities when the evidence clearly
established that he did not.” In support of this argument, defendants
cited finding No. 44 in the trial court’s judgment order, which states:
“David Anderson did not actively participate in any fraud, and cannot
be found personally liable for consumer fraud.”
     Plaintiff’s statement that Anderson was personally involved in any
fraudulent activities was based on the felony charges brought against
Anderson in California which had not been disclosed to plaintiff prior
to the instant trial. Based on the case law plaintiff cited in his
memorandum filed in the trial court, it was his argument that the trial
court could consider this new evidence to show Anderson’s state of
mind, motive and intent in his dealings with plaintiff. See Thompson
v. Petit, 294 Ill. App. 3d 1029, 1035 (1998) (“admission of evidence
of prior similar tortious or wrongful conduct to establish purpose,
intent, motive, knowledge or other mental state of a party to a civil
action forms an exception to the general rule that prohibits proof of
one wrongful act by evidence of the commission of another such act”);
accord Reinneck v. Taco Bell Corp., 297 Ill. App. 3d 211, 215
(1998). Plaintiff obviously hoped to persuade the trial court that,
contrary to its finding, Anderson was, in fact, personally involved in
any fraudulent activities and that the trial court should vacate the
judgment in favor of defendants. Although the trial court ultimately
denied plaintiff’s motion to vacate the judgment, the subject statement
and related argument do not demonstrate bad faith by the plaintiff.
     Defendants also argued that statutory fees are warranted because
plaintiff continually alleged that he was allowed to “postpone” the
safari under the parties’ agreement, but was unable to offer any
evidence at trial to support this claim. We note that defendant
Anderson testified in his deposition that plaintiff raised the issue of

                                  -19-
postponement with Anderson shortly before the scheduled safari
departure date, and agreed that plaintiff was looking for advice as to
whether he should proceed with the scheduled safari, reschedule, or
cancel. Anderson advised plaintiff, “[B]efore you decide to do that
[i.e., postpone the safari], why don’t you let me contact my people on
the ground in East Africa to see what kind of report they come back
with.” Anderson also testified that rescheduling to a different date
“definitely” would have been possible. Finally, Anderson testified that
the document setting forth Luxury’s limitation of liability did not
address postponement. See also Krautsack I, 329 Ill. App. 3d at 670-
71 (summarizing Anderson’s deposition testimony). Although the trial
court, after hearing all the evidence presented at trial, concluded that
the parties’ agreement did not provide for postponement, in light of
Anderson’s pretrial deposition testimony, we cannot say that
plaintiff’s allegation concerning postponement of the safari was made
in bad faith.
     Defendants additionally argued that plaintiff falsely stated, in his
memorandum in support of his motion to vacate the judgment order,
“that a California judge called David Anderson ‘a travel agent who is
registered with the State.’ ” According to defendants, plaintiff failed
to quote the California judge completely and, had he done so, it would
have been apparent that the California judge had not labeled Anderson
a travel agent.
     Plaintiff’s allegedly false statement was made in the context of his
argument that Anderson committed perjury when he testified that he
was not a travel agent. In support of this proposition, plaintiff
provided a copy of Luxury’s California certificate of registration as a
“Seller of Travel,” copies of the California code defining and
regulating sellers of travel, and a transcript from the hearing from
which plaintiff’s allegedly incomplete statement by the California
judge was drawn. After reviewing the transcript, we agree with
defendants that the quote, “a travel agent who is registered,” was not
intended by the California judge to refer specifically to Anderson. That
said, during the course of the same colloquy the judge did indicate that
“defendant is registered” in California as a seller of travel. We note
that whether defendant was a “travel agent,” as that term is used in the
industry, was a source of disagreement and confusion during the
course of this litigation. See No. 1–04–2135 (unpublished order under

                                  -20-
Supreme Court Rule 23). We need not determine the differences, if
any, between a seller of travel and a travel agent. For purposes of the
present argument, inasmuch as plaintiff provided the complete
transcript of the hearing in California, we have difficulty concluding
that plaintiff intended to deceive the trial court by quoting only a
portion of the judge’s actual statement, and will therefore infer no bad
faith.
    Although defendants raised still further arguments in their fee
petition and their response to plaintiff’s motion to strike, we find it
unnecessary to review these arguments in detail here. After careful
review, we conclude that these arguments are either not supported by
the record or insufficient to demonstrate bad faith by the plaintiff.
Accordingly, defendants are not entitled to an award of attorney fees
and costs under section 10a(c) of the Consumer Fraud Act.

                                  IV
    Defendants next argue that the appellate court improperly affirmed
the trial court’s refusal to award sanctions pursuant to Rule 137. In
their fee petition, defendants made the same arguments in support of
Rule 137 sanctions as they did in support of statutory fees. Having
rejected those arguments, no basis exists for an award of fees under
our rule.

                          CONCLUSION
   For the reasons discussed above, we affirm the judgment of the
appellate court affirming the judgment of the trial court.

                                                             Affirmed.

    JUSTICE BURKE took no part in the consideration or decision
of this case.

   JUSTICE KARMEIER, dissenting:
   Section 10a(c) of the Illinois Consumer Fraud and Deceptive
Business Practices Act (Act) provides in relevant part that:

                                 -21-
             “in any action brought by a person under this Section, the
         Court may grant injunctive relief where appropriate and may
         award, in addition to the relief provided in this Section,
         reasonable attorney’s fees and costs to the prevailing party.”
         (Emphasis added.) 815 ILCS 505/10a(c) (West 2004).
    The majority holds that when the defendant is the prevailing party,
the trial court necessarily abuses its discretion in awarding attorney
fees and costs absent a finding that the plaintiff acted in bad faith.
Because the majority is effectively amending the statute to add a
requirement that is not there, I respectfully dissent.
    The cardinal rule of statutory construction is to ascertain and give
effect to the intent of the legislature. The best indication of that intent
is the language of the statute itself, and where that language is
unambiguous, the statute must be enforced as written. Paszkowski v.
Metropolitan Water Reclamation District of Greater Chicago, 213 Ill.
2d 1, 6-7 (2004). This court cannot depart from the plain language of
the statute by reading into it exceptions, limitation, or conditions not
expressed by the legislature. In re Michelle J., 209 Ill. 2d 428, 437
(2004).
    The majority acknowledges that nothing in the plain and
unambiguous language of section 10a(c) conditions a fee award on a
finding that the plaintiff acted in bad faith, but contends that because
section 10a(c) does not expressly restrict a trial court’s discretion or
identify the circumstances under which a fee petition should be
allowed, section 10a(c) must be examined in light of the entire statute
to determine whether the trial court’s proper exercise of discretion
requires a finding of bad faith on the part of the plaintiff before a
prevailing defendant can be awarded costs and fees. Slip op. at 12. I
submit that the legislature’s failure to include such a requirement in
section 10a(c) demonstrates that the legislature did not intend to
require a prevailing defendant to demonstrate bad faith on the part of
the plaintiff. The majority relies on the rule that when interpreting a
statute, a court must give effect to the entire statutory scheme,
interpreting words and phrases in light of other relevant portions of
the statute. Slip op. at 10. However, proper application of this rule
does not permit this court to create additional requirements which are
not found in the plain and unambiguous text of the statute, but which
this court deems necessary to effectuate the statute’s purpose.

                                   -22-
Although the majority makes a persuasive case as to why section
10a(c) should require a prevailing defendant to demonstrate that the
plaintiff acted in bad faith, the legislature chose not to include such a
requirement, and it is not the prerogative of this court to correct the
legislature’s “omissions.” In re Marriage of Murphy, 203 Ill. 2d 212
(2003). As we recently noted: “This court may not legislate, rewrite
or extend legislation. If a statute, as enacted, seems to operate in
certain cases unjustly or inappropriately, the appeal must be to the
General Assembly, and not to this court.” DeSmet v. County of Rock
Island, 219 Ill. 2d 497, 510 (2006). Because the majority is, under the
guise of defining the trial court’s proper exercise of its discretion,
imposing a limitation on a defendant’s right to costs and fees under
section10a(c) which is not found in the plain and unambiguous
language of the statute, I dissent.

                                  -23-