Northwestern Steel & Wire Co. v. Industrial Commission

627 N.E.2d 71, 254 Ill. App. 3d 472, 193 Ill. Dec. 912, 1993 Ill. App. LEXIS 1438
Appellate Court of Illinois·Decided September 16, 1993·No. 1—92—1226, 1—92—1285, 1—92—1451 cons.·Published·Cited by 8 cases

Opinion

JUSTICE HOFFMAN

delivered the opinion of the court:

Both the plaintiff, Northwestern Steel & Wire Company (Northwestern), and the defendant, the Industrial Commission of Illinois (Commission), appeal under Supreme Court Rule 307(a)(1) (134 Ill. 2d R. 307(a)(1)) from a modified temporary restraining order. The order found that the Commission’s rules relating to the requirements for approval as a self-insurer for workers’ compensation claims were unconstitutional. The order required the Commission to provide Northwestern with a hearing to challenge the amount of security it must post as a condition to renew its status as a self-insurer. We consider whether the trial court abused its discretion when it modified the temporary restraining order. For the following reasons, we reverse and remand with directions.

Background

Northwestern filed a verified complaint for declaratory judgment on January 22, 1992, alleging the following facts. It was required to provide workers’ compensation to its employees as an employer under the Workers’ Compensation Act (Ill. Rev. Stat. 1991, ch. 48, par. 138.1 et seq.). Since 1965, the Commission approved Northwestern as a self-insurer of its workers’ compensation claims and Northwestern posted security with the Commission each year in amounts from $10,000 to $200,000. In May 1991, Northwestern applied to the Commission for a renewal of its self-insured status.

While Northwestern’s application was pending, the Commission amended section 7100.70 of its insurance regulations (50 Ill. Adm. Code §7100.70 (1992)), which set the process and methods the Commission used to determine whether employers should be approved as self-insurers. Under this section, employers were required to provide “security, indemnity and/or surety bond” as a condition precedent to the Commission’s approval for self-insured status. (50 Ill. Adm. Code §7100.70(c)(3) (1992).) The section also set the formula to determine the amount of an employer’s security.

In a letter dated November 21, 1991, the Commission notified Northwestern that its application was approved on the condition that it post security in the amount of $8.8 million, which was calculated under section 7100.70 as amended. The first installment was due within 60 days.

In its three-count complaint, Northwestern alleged, inter alia, that section 7100.70 violated its due process rights and requested the circuit court to declare that the section was unconstitutional.

With its complaint, Northwestern filed motions for a temporary restraining order and a preliminary injunction to enjoin the Commission from terminating its status as a self-insurer. The day Northwestern filed its complaint, the trial court granted Northwestern’s motion for a temporary restraining order without notice to the Commission. The court entered an order restraining the Commission from requiring Northwestern to post the first installment of the security, increasing the amount of the security, or issuing a notice of hearing to show cause why Northwestern’s application for self-insured status should not be denied. The order was set to expire on February 3, 1992.

The Commission responded to the declaratory judgment complaint by filing a motion to dismiss arguing that Northwestern failed to state a claim upon which relief could be granted. The trial court held several hearings on the Commission’s motion and continued the temporary restraining order while the motion was pending.

After considering the arguments of the parties, the court sua sponte entered a modified temporary restraining order on April 15, 1992, without ruling on the Commission’s motion to dismiss. The court found that section 7100.70 of the Commission’s rules was unconstitutional because it denied Northwestern its due process right to a hearing before the Commission could require Northwestern to post additional security as a condition to renew its self-insured status. The court found that the section was deficient because it required Northwestern to post security as a precondition to challenging the amount of the security, established a rule to show cause proceeding rather than an appeal, and failed to afford Northwestern an opportunity to present evidence that the rule establishing the security requirement was unreasonable. Based on those findings, the court modified the temporary restraining order by ordering the Commission to provide Northwestern with a hearing to appeal the amount of security required. The court further established that in the hearing, the Commission would have the burden to prove a prima facie case that the required security was appropriately determined under its rules and Northwestern could present evidence in rebuttal. The Commission then would decide whether the rules were correctly applied and determine whether the rules were valid or should be modified. The order also provided that the Commission’s motion to dismiss was continued and the cause was stayed pending the hearing. The order recited that the temporary restraining order as modified would remain in effect until further order of the court.

The Commission and Northwestern filed interlocutory appeals from that order.

Opinion

Both of the parties contend, for different reasons, that the trial court abused its discretion in entering the modified temporary restraining order which required the Commission to provide Northwestern with a hearing.

Initially, Northwestern maintains that the Commission should be estopped from appealing the modified temporary restraining order because it was entered in its favor and the hearing was ordered at its suggestion. (See J.L. Simmons Co. ex rel. Hartford, Insurance Group v. Firestone Tire & Rubber Co. (1985), 108 Ill. 2d 106, 483 N.E.2d 273 (party cannot claim error when it induced the trial court’s mistake); Illinois Bell Telephone Co. v. Illinois Commerce Comm’n (1953), 414 Ill. 275, 111 N.E.2d 329 (successful party should not be allowed to appeal when it disagrees with the findings of the trial court).) This argument is without merit. The Commission was not successful in the trial court because the hearing ordered by the court is not required under its procedural rules. Also, the record discloses that the Commission made it clear to the trial court before the order was entered that it did not agree to grant Northwestern a hearing.

Northwestern also maintains that by this appeal, the Commission cannot seek to reverse the temporary restraining order entered on January 22, 1992, which essentially enjoined the Commission from increasing Northwestern’s security or terminating its status as a self-insurer. We agree. An appeal under Rule 307 “does not open the door to a general review of all orders entered by the trial court up to the date of the order that is appealed.” (In re Petition of Filippelli (1990), 207 Ill. App. 3d 813, 818, 566 N.E.2d 412, 415.) Failure to appeal from an order that is immediately appealable under Rule 307 results in a bar to a review of that order on a subsequent appeal.

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Northwestern Steel & Wire Co. v. Industrial Commission, 627 N.E.2d 71, 254 Ill. App. 3d 472, 193 Ill. Dec. 912, 1993 Ill. App. LEXIS 1438 (Ill. Ct. App. 1993).

627 N.E.2d 71 (Northwestern Steel & Wire Co. v. Industrial Commission) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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