Poulos v. Litwin

549 N.E.2d 855, 193 Ill. App. 3d 35, 140 Ill. Dec. 204, 1989 Ill. App. LEXIS 1964
CourtAppellate Court of Illinois
DecidedDecember 29, 1989
DocketNo. 1—88—3744
StatusPublished
Cited by8 cases

This text of 549 N.E.2d 855 (Poulos v. Litwin) 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
Poulos v. Litwin, 549 N.E.2d 855, 193 Ill. App. 3d 35, 140 Ill. Dec. 204, 1989 Ill. App. LEXIS 1964 (Ill. Ct. App. 1989).

Opinion

JUSTICE O’CONNOR

delivered the opinion of the court:

This is an appeal from the dismissal of a citation to discover assets against defendant, Gallo Equipment Company. At issue is whether, under section 2 — 1402 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 1402), judgment creditors in a supplemental citation proceeding are entitled to a restraining order against a defendant in a personal injury suit brought by the judgment debtor in order to satisfy the creditor’s claim against the proceeds if the judgment debtor’s action is successful. We affirm.

Plaintiffs, James Poulos and Thomas Poulos, initially brought an action in forcible entry and detainer against defendant Richard A. Litwin. Judgment in the amount of $7,549.80 was entered in favor of plaintiffs. Following an appeal by defendant, this court held that defendant was entitled to a jury trial on the issue of damages. The matter was tried on May 31, 1988, and the jury found in favor of plaintiffs in the amount of $31,359.80.

Subsequent to the entry of that judgment, plaintiffs became aware that on January 27, 1988, defendant and his wife, Jacqueline Litwin, had filed a personal injury action in the circuit court of Cook County against Gallo Equipment Company (Gallo), TCM America, Inc. (TCM), and Grand Rock Company, case No. 88 — L—1722. That case has not been resolved and has not gone to trial.

On August 6, 1988, plaintiffs issued citations to discover assets upon, inter alia, Margolis and Velasco, attorneys for Litwin, Marthe C. Purmal, attorney for TCM, and James Desveaux, attorney for Gallo. Marthe Purmal and Thomas Mangan, on behalf of Desveaux, filed motions to quash the citation proceedings, and on September 21, 1988, the proceedings against Purmal and Desveaux were dismissed with prejudice. Litwin, the judgment debtor, apparently never has been served with a citation to discover assets.

On October 5, 1988, pursuant to section 2 — 1402 (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 1402), plaintiffs filed citations to discover assets against respondents Michael Gallo, president of Gallo, and TCM. Respondents were commanded to appear on October 28, 1988, to be examined under oath regarding property or income of or indebtedness due Litwin. Respondents were also directed to produce copies of any and all pleadings filed in case No. 88 — L—1722. Following a hearing in which respondents argued that in order for the action to proceed, the indebtedness must be liquidated and due without contingency, the trial court dismissed the citations to discover assets with prejudice. Plaintiffs filed a motion to reconsider, which was denied, and plaintiffs appealed. Citation defendant TCM filed a motion to be dismissed from the appeal. That motion was granted, and the appeal remains pending only as to citation defendant Gallo. Just prior to oral argument, plaintiffs moved to stay this appeal on the basis that defendant Litwin had filed proceedings under chapter 7 of the Bankruptcy Code (11 U.S.C. §701 et seq. (1988)). That motion was denied.

The parties are in agreement that this is a case of first impression in Illinois in that plaintiffs are attempting to restrain the transfer of proceeds (if any) of an unliquidated, contingent personal injury claim.

The citation defendant initially raises a challenge to the court’s jurisdiction. First, relying on Moran v. Lala (1989), 179 Ill. App. 3d 771, 781, 534 N.E.2d 1319, Galo argues that by failing to include the jurisdictional statement required by Supreme Court Rule 341(eX4Xii) (134 Ill. 2d R. 341(eX4Xii)), plaintiffs have waived argument on the issues raised. While failing to comply with supreme court rules can result in the waiver of the issues raised, we decline to do so here, despite plaintiffs’ omission of the jurisdictional statement, as there is no question but that the October 25, 1988, order was final and appealable.

Defendant also, however, asks us to address the ruling in Elg v. Whittington (1988), 119 Ill. 2d 344, 518 N.E.2d 1232, which requires that an appeal from a judgment that is final as to one or more but fewer than all of the parties or claims must be filed within 30 days of an order containing a finding pursuant to Supreme Court Rule 304(a) (107 Ill. 2d R. 304(a)) that the order is final and appealable. Defendant claims that the order quashing the citation was a final judgment as to Gallo and TCM but not as to all of the parties, as the citation to discover assets as against Litwin had been continued from September 23, 1988, to October 28, 1988, and he had never been served. Defendant contends that as a result of the Rule 304(a) finding, the order quashing the citations became immediately appealable and the circuit court was divested of jurisdiction to entertain plaintiffs’ motion to reconsider.

Despite the Rule 304(a) language, stating that there was “no just reason for delaying enforcement or appeal” (107 Ill. 2d R. 304(a)), this action was brought as a supplementary action pursuant .to section 2— 1402(a) of the Illinois Code of Civil Procedure. It was not piecemeal litigation as contemplated by Rule 304(a); thus, the Rule 304(a) language in the trial court’s dismissal order was surplusage and the appeal period was not governed by the restrictions of Elg v. Whittington.

Pursuant to section 2 — 1402(a), “It is not a prerequisite to the commencement of a supplementary proceeding that a certified copy of the judgment has been returned wholly or partly unsatisfied.” (Ill. Rev. Stat. 1987, ch. 110, par. 2 — 1402(a).) Supreme Court Rule 277(g) (107 Ill. 2d R. 277(g)), provides: “Supplementary proceedings against the debtor and third parties may be conducted concurrently or consecutively. The termination of one proceeding does not affect other proceedings not concluded.” Thus, for purposes of appeal, the supplementary proceeding filed against TCM was a separate action, and plaintiffs’ appeal following the denial of their motion to reconsider was timely.

The sole question remaining is whether the citations to discover assets were improperly quashed.

Section 2 — 1402 of the Illinois Code of Civil Procedure, which governs supplementary proceedings, provides:

“A judgment creditor *** is entitled to prosecute supplementary proceedings for the purposes of examining the judgment debtor or any other person to discover assets or income of the debtor ***.” (Emphasis added.) Ill. Rev. Stat. 1987, ch. 110, par. 2 — 1402.

Although plaintiffs do not argue that the citation defendant currently possesses either assets or income of the judgment debtor, they contend that, consistent with In re Marriage of Rockford, (1980), 91 Ill. App. 3d 769, 775, 414 N.E.2d 1096, a lien on intangible property, such as the contingent personal injury claim here, may be created by instituting proceedings to discover assets. We disagree. While the court in Rockford noted that a lien on intangible property may be created by instituting proceedings to discover assets, it does not necessarily follow therefrom that a restraining order may be directed to a defendant in a judgment debtor’s personal injury suit.

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Bluebook (online)
549 N.E.2d 855, 193 Ill. App. 3d 35, 140 Ill. Dec. 204, 1989 Ill. App. LEXIS 1964, Counsel Stack Legal Research, https://law.counselstack.com/opinion/poulos-v-litwin-illappct-1989.