McClure Engineering Associates, Inc. v. Reuben Donnelley Corp.

428 N.E.2d 1151, 101 Ill. App. 3d 1109, 57 Ill. Dec. 471, 1981 Ill. App. LEXIS 3634
Appellate Court of Illinois·Decided November 19, 1981·No. 80-546·Published·Cited by 17 cases

Opinions

Mr. JUSTICE BARRY

delivered the opinion of the court:

This is an appeal from a judgment of the circuit court of Rock Island County entered upon a motion for directed verdict at the close of plaintiff’s case. Plaintiff was awarded the sum of $271.20 and has appealed, claiming that the limitation on defendant’s liability contained in the parties’ contract is void as against public policy.

Plaintiff, McClure Engineering Associates, Inc. (McClure), is a professional engineering firm. Defendant, Reuben H. Donnelley Corporation (Donnelley), is a publisher of yellow pages for the telephone company. In 1975 and 1976, plaintiff contracted with defendant’s agent for the purchase of advertising space in the yellow pages of the succeeding years’ telephone directories for Geneseo, Illinois. In addition, in 1976 plaintiff contracted to purchase space in the 1977 telephone directory for Freeport, Illinois. The requested advertisements were omitted from the three directories. Donnelley tendered $271.20, the amount paid by McLure Engineering for the advertisements, pursuant to the following provisions which were contained in the contracts:

“The advertiser is expected to pay the rate as billed. The liability of the Telephone Company in connection with any error or omission in publication of, or failure to publish, any item of advertising in any issue of any directory, shall be limited to the charges for the publication in such issue of the item of advertising involved, excluding charges for cuts, engravings or electrotypes. The term ‘Telephone Company’ shall include any or all Telephone Companies involved in this transaction, the Selling Company, the Publishing Companies, or any representative of said company or companies.”

This suit followed. McClure Engineering complained that it suffered losses in excess of $60,000 as a result of Donnelley’s negligence in omitting the advertisements. The trial court, upon conclusion of McClure’s case, granted Donnelley’s motion for a directed verdict and entered judgment in the amount of $271.20. On appeal, plaintiff raises a single issue. That is, is the exculpatory clause contained in the parties’ contracts, which insulates defendant from liability for negligence, invalid as being contrary to public policy in Illinois?

Plaintiff urges this court to adopt the view espoused by courts in two sister jurisdictions wherein exculpatory clauses have been held to be void as a matter of public policy. Plaintiff cites Woodburn v. Northwestern Bell Telephone Co. (Iowa 1979), 275 N.W.2d 403, and Allen v. Michigan Bell Telephone Co. (1969), 18 Mich. App. 632, 171 N.W.2d 689, in support of its argument. Initially, we note, as defendant is quick to point out, that the Iowa court, in Woodburn, specifically ruled against plaintiff on the question presently before the court in this case. The Woodburn court remanded the cause to the trial court solely for resolution of the question of mutuality of assent in the formation of the contract — an issue which has not been raised in the instant case. Furthermore, the precedential value of the Michigan case, Allen, is diminished by the fact that the Michigan appellate court, upon second review, limited its holding concerning the enforceability of the exculpatory clause therein by stating that its earlier ruling on that issue was the law of the case. (Allen v. Michigan Bell Telephone Co. (1975), 61 Mich. App. 62, 65, 232 N.W.2d 302, 304.) Because the holdings of these cases are of, at best, questionable precedential value, we decline to embrace the opinions for the proposition advanced by plaintiff herein.

While the precise issue before this court has not received prior attention in the reviewing courts of Illinois, we believe that the general rules of law which guide the outcome of this case are fairly well established. Generally, Illinois adheres to the rule, in keeping with the principle of freedom of contract, that contractual limitations are valid and enforceable. (First Financial Insurance Co. v. Purolator Security, Inc. (1979), 69 Ill. App. 3d 413, 417,388 N.E.2d 17, 20 (citing Schumann-Heink v. Folsom (1927), 328 Ill. 321, 159 N.E. 250); Pick Fisheries, Inc. v. Burns Electronic Security Services, Inc. (1976), 35 Ill. App. 3d 467, 342 N.E.2d 105; see also cases in Annot., 92 A.L.R.2d 917, 935-45 (1963), and A.L.R.2d Later Case Service 40-42 (1976).) In the absence of legislative directive to the contrary, an exculpatory clause generally will be held valid. The exception to this rule, thereby permitting the court to invalidate an exculpatory clause, obtains “only if a special social relationship of a semi-public nature is found to permeate the transaction between the parties.” (First Financial Insurance Co. (1979), 69 Ill. App. 3d 413, 418, 388 N.E.2d 17, 21.) Relationships such as employer-employee (Campbell v. Chicago, Rock Island & Pacific Ry. Co. (1910), 243 Ill. 620, 90 N.E. 1106) and public carrier-passenger (Checkley v. Illinois Central R.R. Co. (1913), 257 Ill. 491, 100 N.E. 942) are examples of these special social relationships.

Plaintiff attempts to place his relationship with defendant Donnelley into the category of special social relationships covered by the exception to the general rule based on several factors which, plaintiff contends, render defendant’s business activities a “public service.” Plaintiff’s argument necessarily proceeds from the premise that providers of public services may not escape liability for their own negligence through exculpatory provisions in their contracts. (57 Am. Jur. 2d Negligence §27 (1971).) As will be shown, we do not believe that the facts of the present case lend themselves to the conclusion that plaintiff urges us to reach.

Firstly, plaintiff contends that defendant’s business is largely a government-regulated monopoly. While the telephone business itself is subject to governmental regulation, defendant, as a private corporation engaged by the telephone company to publish its yellow pages, is not a government-regulated monopoly.

Free access — add to your briefcase to read the full text and ask questions with AI

McClure Engineering Associates, Inc. v. Reuben Donnelley Corp., 428 N.E.2d 1151, 101 Ill. App. 3d 1109, 57 Ill. Dec. 471, 1981 Ill. App. LEXIS 3634 (Ill. Ct. App. 1981).

428 N.E.2d 1151 (McClure Engineering Associates, Inc. v. Reuben Donnelley Corp.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Jaime v. Jaime
2023 IL App (3d) 190185-U (Appellate Court of Illinois, 2023)
Mobile Electronic Service, Inc. v. FirsTel, Inc.
2002 SD 87 (South Dakota Supreme Court, 2002)
Mobile Electric v. Firstel
2002 SD 87 (South Dakota Supreme Court, 2002)
Rosenstein v. Standard & Poor's Corp.
636 N.E.2d 665 (Appellate Court of Illinois, 1993)
Hartford v. Burns International Security Services., Inc.
526 N.E.2d 463 (Appellate Court of Illinois, 1988)
Lohman v. Morris
497 N.E.2d 143 (Appellate Court of Illinois, 1986)
Dana Point Condominium Ass'n v. Keystone Service Co.
491 N.E.2d 63 (Appellate Court of Illinois, 1986)
Allstate Insurance v. Winnebago County Fair Ass'n
475 N.E.2d 230 (Appellate Court of Illinois, 1985)
Rozeboom v. Northwestern Bell Telephone Co.
358 N.W.2d 241 (South Dakota Supreme Court, 1984)
Discount Fabric House of Racine, Inc. v. Wisconsin Telephone Co.
345 N.W.2d 417 (Wisconsin Supreme Court, 1984)
McClure Engineering Associates, Inc. v. Reuben H. Donnelley Corp.
447 N.E.2d 400 (Illinois Supreme Court, 1983)
McClure Engineering Associates, Inc. v. Reuben Donnelley Corp.
428 N.E.2d 1151 (Appellate Court of Illinois, 1981)