Ellens v. Chicago Area Office Federal Credit Union

576 N.E.2d 263, 216 Ill. App. 3d 101, 159 Ill. Dec. 594, 1991 Ill. App. LEXIS 1070
CourtAppellate Court of Illinois
DecidedJune 21, 1991
Docket1-90-1212
StatusPublished
Cited by17 cases

This text of 576 N.E.2d 263 (Ellens v. Chicago Area Office Federal Credit Union) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ellens v. Chicago Area Office Federal Credit Union, 576 N.E.2d 263, 216 Ill. App. 3d 101, 159 Ill. Dec. 594, 1991 Ill. App. LEXIS 1070 (Ill. Ct. App. 1991).

Opinion

JUSTICE McNAMARA

delivered the opinion of the court:

Plaintiff, Levolia Ellens, filed suit against defendants Chicago Area Office Federal Credit Union (credit union); board of directors of Chicago Area Office Federal Credit Union (board of directors); and Cumis Insurance Society, Inc. (Cumis), to recover salary for services plaintiff rendered as treasurer to a federally organized credit union, and compensatory damages for depriving him of his right to sit on the credit union board of directors. The trial court granted defendants’ motion to dismiss eight counts of plaintiff’s complaint, and the remaining two counts were subsequently dismissed by the court for want of prosecution.

Plaintiff appeals from the dismissal of all 10 counts. The central element for dismissal found in counts II through X concerns the lack of support for plaintiff’s claim of compensable damages. Plaintiff’s failure to provide an adequate justification for his damage calculation is of paramount importance in the dismissal of those nine counts, and outweighs our need to discuss other significant factors taken into account by the trial court in the dismissal of each individual count.

The following facts are adduced from the record. During 1982 and 1983, plaintiff served as a member of the board of directors of the credit union, and also as its treasurer. On March 30, 1983, plaintiff was reelected to the board for a two-year term.

On March 22, 1983, plaintiff issued a check to another board member, Amelia King, -without obtaining board approval, in violation of express credit union regulations. At a meeting on April 7, 1984, the board discussed the facts and circumstances relating to the issuance of the check to King. Plaintiff refused to answer any of the board’s inquiries regarding this incident. On April 17, 1984, the board voted to vacate plaintiff’s office on the board for misconduct. The board notified Cumis, its insurance company which provided surety-ship coverage, of its decision to remove plaintiff from the board. Cumis replied stating that plaintiff’s bond coverage would be terminated under the board’s comprehensive policy of fidelity insurance.

On July 26, 1984, plaintiff made a request to the board for $6,000 as payment for services rendered as treasurer of the credit union. The board refused plaintiff’s request for payment.

In 1985, plaintiff was again elected to the board of directors by the membership of the credit union. The board refused to seat plaintiff or otherwise allow him to participate in board meetings or affairs because bond coverage of plaintiff under its policy with Cumis had been terminated.

In 1984, plaintiff and King filed suit in the United States District Court, Northern District of Illinois, against five individual board members seeking recovery for his salary as treasurer. Federal jurisdiction was based upon the Federal Credit Union Act, 12 U.S.C. §1761 (1988) (the Act). On September 9, 1986, trial was conducted resulting in a directed judgment in favor of defendants.

The U.S. magistrate made the following conclusions of law: (1) the board acted properly within its authority when it removed plaintiff as a member of the board of directors of the credit union; (2) pursuant to the business judgment rule, the board is presumed to have acted on an informed basis, in good faith, and in the honest belief that the action taken to vacate plaintiff’s position on the board was in the best interests of the credit union; (3) the board’s actions in vacating plaintiff’s position were not arbitrary or capricious; and (4) plaintiff was not entitled to recover any compensation for his services as treasurer from defendants.

On November 18, 1987, plaintiff filed this complaint in the circuit court of Cook County against the credit union, the board of directors, Rosemarie Armstrong individually and as a member of the board of directors, and Cumis. Plaintiff sought damages in excess of $50,000 for counts II through IX as compensation for deprivation of his right to run for, hold and serve as a member of the board of directors; to attend board meetings, and to otherwise function as a member of the board. In count X plaintiff alleges civil conspiracy among defendants, for which he claims $500,000 as damages to his reputation and for deprivation of his right to sit on the board of directors. Plaintiff also charges in his conspiracy count that defendants acted with malice, and requested punitive damages of $1,000,000.

COUNT I

In count I, plaintiff sought recovery of the same salary ($6,000) at issue in the Federal action, but named the credit union as defendant instead of the five individual board members. The credit union argues that plaintiff is barred from litigating this claim on the ground of res judicata. We agree.

Under the doctrine of res judicata, a final judgment on the merits which is rendered by a court of competent jurisdiction is conclusive as to the rights of the same parties or their privies, but that judgment bars a later action only if it involves the same cause of action. Significantly, it is conclusive not only as to every matter raised in the first action, but also as to any matter which might have been raised. Housing Authority v. YMCA (1984), 101 Ill. 2d 246, 461 N.E.2d 959; Benton v. Smith (1987), 157 Ill. App. 3d 847, 510 N.E.2d 952.

The essential elements of res judicata are (1) an identity of parties or their privies in the two suits; (2) an identity of causes of action in the earlier and the later suit; and (3) a final judgment on the merits in the earlier suit. (Best Coin-Op, Inc. v. Paul F. Ilg Supply Co. (1989), 189 Ill. App. 3d 638, 545 N.E.2d 481.) In order for a previous judgment to be conclusive, it must appear clearly and certainly that the precise issue was decided in the previous action. (Coulter v. Renshaw (1981), 94 Ill. App. 3d 93, 418 N.E.2d 489.) The party asserting the preclusion bears the burden of showing with clarity and certainty what was determined by the prior judgment. People ex rel. Scott v. Chicago Park District (1976), 66 Ill. 2d 65, 360 N.E.2d 773; Redfern v. Sullivan (1982), 111 Ill. App. 3d 372, 444 N.E.2d 205.

In this case, res judicata is operative as a bar against count I because the issue of plaintiff’s compensation for services rendered as treasurer for the credit union was previously decided in the Federal action. (King v. Armstrong (N.D. Ill. September 9, 1986), No. 84 C 9439.) While plaintiff named the credit union in the present case instead of the five individual board members, privity exists because the board members were agents of the credit union. As such, an adjudication in favor of the agent would necessarily exonerate the principal. (Hays v. Louisiana Dock Co.

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Bluebook (online)
576 N.E.2d 263, 216 Ill. App. 3d 101, 159 Ill. Dec. 594, 1991 Ill. App. LEXIS 1070, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ellens-v-chicago-area-office-federal-credit-union-illappct-1991.