Court Opinion

ID: 9518991
Source: CourtListenerOpinion
Date Created: 2023-08-07 01:06:56.770308+00
Date Added: 2024-06-11T12:37:15.710435
License: Public Domain

CHIEF JUSTICE BILANDIC, dissenting: I respectfully dissent from the majority’s conclusion that summary judgment against Reginald O’Banner was proper. The majority opinion holds that the record is "devoid” of any facts suggesting that O’Banner relied on an apparent agency in going to the McDonald’s restaurant where he was allegedly injured. 173 Ill. 2d at 214. I disagree with the majority’s assessment of the record. In addressing the issue of whether summary judgment was properly entered against O’Banner, we must keep in mind that summary judgment is a drastic remedy. In re Estate of Hoover, 155 Ill. 2d 402, 410 (1993). A court should only grant summary judgment when the resolution of a case hinges on a question of law and the moving party’s right to judgment is clear and free from doubt. Hoover, 155 Ill. 2d at 410; Colvin v. Hobart Brothers, 156 Ill. 2d 166, 169-70 (1993). If the court finds that the record contains any genuine issue of material fact, it should deny the motion for summary judgment. Because of the severity of the summary judgment remedy, the court has a duty to construe the record strictly against the movant and liberally in favor of the non-moving party. Hoover, 155 Ill. 2d at 411; Colvin, 156 Ill. 2d at 170. When construing the record, the court may draw inferences from the undisputed facts. Loyola Academy v. S&S Roof Maintenance, Inc., 146 Ill. 2d 263, 272 (1992); Pyne v. Witmer, 129 Ill. 2d 351, 358 (1989). Applying these principles to the case at bar, summary judgment should not have been granted in McDonald’s Corporation’s favor. When the record is viewed liberally in favor of O’Banner and strictly against McDonald’s Corporation, there remains a genuine issue of material fact concerning the existence of an apparent agency relationship between McDonald’s Corporation and its franchisee, who operated the restaurant where O’Banner was allegedly injured. The apparent agency doctrine recognizes that a "principal will be bound not only by that authority which he actually gives to another, but also by the authority which he appears to give.” Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511, 523 (1993). In other words, if the principal creates the appearance that someone is his agent, the principal will not then be permitted to deny the agency where an innocent third party has relied on it and has been harmed as a result. Gilbert, 156 Ill. 2d at 524. This court recently applied the apparent agency doctrine in a tort case in the context of a hospital setting in Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511 (1993). There, a patient suffered a heart attack after being treated and released by a physician at a hospital emergency room. The patient sued the hospital for negligence, and the trial court granted the hospital summary judgment on the theory that the hospital could not be held vicariously liable because the emergency room physician was an independent contractor, not an actual agent of the hospital. This court reversed the grant of summary judgment in the hospital’s favor, finding that a genuine issue of material fact remained as to whether the physician was an apparent agent of the hospital. Gilbert, 156 Ill. 2d at 526. Similarly, the apparent agency doctrine can and should be applied in a franchisor-franchisee setting. See Shaffer v. Maier, 68 Ohio 3d 416, 627 N.E.2d 986 (1994); Watson v. Howard Johnson Franchise Systems, Inc., 216 Ga. App. 237, 453 S.E.2d 758 (1995); Parker v. Domino’s Pizza, Inc., 629 So. 2d 1026 (Fla. App. 1993); Gizzi v. Texaco, Inc., 437 F.2d 308 (3d Cir. 1971); Crinkley v. Holiday Inns, Inc., 844 F.2d 156 (4th Cir. 1988). For a franchisor to be vicariously liable for the acts of its franchisee under the apparent agency doctrine, a plaintiff must show that: (1) the franchisor has represented or permitted it to be represented that the party dealing directly with the plaintiff is its agent; and (2) the plaintiff, acting in justifiable reliance on such representations of the franchisor, has dealt with the agent to the detriment of the plaintiff. Crinkley, 844 F.2d at 166; see Gilbert, 156 Ill. 2d at 525. The first element is satisfied where the franchisor holds itself out as the provider of certain goods and services without informing the patron that the goods and services are provided by another, whom it considers to be a nonagent, such as a franchisee. The element of justifiable reliance is satisfied if the plaintiff relies on the franchisor to provide the goods and services, rather than on the franchisee. In the present case, the record contains facts from which it may reasonably be inferred that McDonald’s Corporation holds itself out as being the entity responsible for the operation of McDonald’s restaurants. McDonald’s Corporation’s wide, national advertising and its reach into virtually every aspect of its franchisee’s business make a patron’s assumption that McDonald’s Corporation runs McDonald’s restaurants natural. These facts can be gleaned from the license agreement, which is contained in the record. The license agreement states: "McDonald’s Corporation *** has developed and operates a restaurant system ('McDonald’s System’). *** The McDonald’s System is operated and is advertised widely within the United States of America.” The license agreement further reveals that McDonald’s Corporation strives, through its contractual agreements, to ensure that it alone controls how the public perceives its restaurants. McDonald’s Corporation’s "system” is described as being "comprehensive,” the foundation of which is the franchisee’s adherence to McDonald’s Corporation’s "standards and policies” "providing for the uniform operation of all McDonald’s restaurants within the McDonald’s system.” This includes requiring the franchisee to serve only designated food and beverage products; to use only prescribed equipment and building layout and designs; to have all employees wear McDonald’s Corporation’s uniforms; to train management personnel at McDonald’s Corporation’s "Hamburger University”; and to adhere strictly to McDonald’s Corporation’s prescribed standards of "Quality, Service and Cleanliness” in the franchisee’s restaurant operation. The McDonald’s Corporation’s national advertising also promotes its "system” without distinguishing her tween company-owned and franchised properties. Pursuant to this national advertising; the public is pre-. sented with an identical menu, brand names and promotional offers in all McDonald’s Corporation’s restaurants. Given these facts, a jury could reasonably conclude that McDonald’s Corporation acted in such a way as to create the appearance that it owned ánd operated the McDonald’s restaurant at which the plaintiff was allegedly injured. The second element is whether' O’Banner justifiably acted in reliance on McDonald’s Corporatipn’s representations in going to the McDonald’s restaurant where he was allegedly injured. The majority opinion, finds that the record provides no indication as to why O’Banner went to the McDonald’s restaurant in the first place. 173 Ill. 2d at 214. I' disagree with this finding. O’Banner’s reasons are readily inferable from the rec-. ord. In his response to McDonald’s Corporation’s motion for summary judgment, O’Banner stated that he was a . business invitee of a McDonald’s restaurant. And in his attached affidavit, he averred: "Upon information and: belief, the executed license agreement *** contains language which establishes that *■*•* McDonald’s Corporation maintained control in. the operation of the franchise and over the daily procedures and business” of the McDonald’s restaurant. As I noted above in my discussion of the holding-out element; the license agree- , ment shows a great deal of control by McDonald’s Corporation over the franchisee’s operation of. the restaurant at issue. It further details how McDonald’s Corporation nationally advertises its ’^comprehensive” and "uniform” restaurant "system” to the public as,. inter alia, a "clean, wholesome atmosphere.” From these facts, a jury may infer that the public perception is that a McDonald’s restaurant is what it proclaims to be and not "ABC,” the franchisee’s restaurant. Thus, when O’Banner’s reply and affidavit are considered along with the license agreement, there remains a genuine issue of material fact as to whether O’Banner justifiably acted in reliance on the franchisee’s apparent authority in entering the McDonald’s restaurant. After considering the record liberally in favor of O’Banner, I find that it presents a genuine issue of material fact as to whether McDonald’s Corporation could be vicariously liable for the acts of its franchisee based on the doctrine of apparent agency. O’Banner is thus entitled to his day in court to resolve this factual controversy. As a final matter, McDonald’s Corporation contends that O’Banner waived the issue of apparent agency because he did not plead it. This waiver argument fails. In his complaint, O’Banner alleged that McDonald’s Corporation "was doing business in Illinois and owning or leasing, operating, maintaining and/or controlling” the McDonald’s restaurant at issue. These allegations are sufficient to plead an agency relationship. See Gilbert, 156 Ill. 2d at 527. I further find that McDonald’s Corporation’s position is disingenuous in this regard. In its motion for reconsideration, McDonald’s Corporation itself acknowledged that O’Banner was seeking to hold it liable based on an apparent agency theory. Consequently, McDonald’s Corporation is not entitled to an affirmance of the summary judgment entered in its favor on this ground. For the reasons stated, there exists a genuine issue of material fact regarding the existence of an apparent agency rélationship between McDonald’s Corporation and the franchisee involved in this case. Summary judgment should not have been granted because McDonald’s Corporation’s right to judgment is not clear and free from doubt. The cause should be remanded to the trial court for further proceedings. JUSTICE FREEMAN joins in this dissent.