Taylor v. State Universities Retirement System

560 N.E.2d 893, 203 Ill. App. 3d 513, 148 Ill. Dec. 296, 1990 Ill. App. LEXIS 1018
CourtAppellate Court of Illinois
DecidedJuly 12, 1990
DocketNo. 4-89-0468
StatusPublished
Cited by21 cases

This text of 560 N.E.2d 893 (Taylor v. State Universities Retirement System) 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
Taylor v. State Universities Retirement System, 560 N.E.2d 893, 203 Ill. App. 3d 513, 148 Ill. Dec. 296, 1990 Ill. App. LEXIS 1018 (Ill. Ct. App. 1990).

Opinion

PRESIDING JUSTICE KNECHT

delivered the opinion of the court:

The State Universities Retirement System (SURS) appeals a circuit court order holding it is liable for attorney fees with respect to a recoupment of disability benefits which it obtained. The attorney who requested payment of the fees cross-appeals the portion of the same order which holds the circuit court lacks jurisdiction to order SUES to pay him the fees, and his only recourse for obtaining payment of the fees is an action in the Illinois Court of Claims.

Between April 1, 1983, and September 30, 1983, Jess Burwell received SUES disability benefits totalling $6,954.66. Subsequently, in proceedings before the Industrial Commission, Burwell obtained a judgment against the University of Illinois in the amount of approximately $12,500. This judgment was entered pursuant to the Workers’ Occupational Diseases Act (Ill. Rev. Stat. 1987, ch. 48, pars. 172.36 through 186.1), and it represented compensation for the same disability as to which Burwell received SUES disability benefits. Burwell’s attorney in the proceedings before the Industrial Commission was John C. Taylor, who is the plaintiff in the present action.

On August 15, 1985, Taylor notified SUES of his success in obtaining the Occupational Diseases Act award on Burwell’s behalf. Along with that letter, Taylor enclosed a check payable to SUES, Burwell, and Taylor in the amount of $6,954.66. Taylor stated he was entitled to 20% of this amount, or approximately $1,390, for his attorney fees pursuant to the “attorney’s trust fund doctrine.” He requested SUES endorse the check and return it to him.

David Hoffmeister, SUES’ executive director, responded to Taylor’s letter on August 22, 1985. He stated section 15 — 153.1(c) of the Illinois Pension Code (Code) (Ill. Eev. Stat. 1987, ch. 108V2, par. 15— 153.1(c)) provides SUES with a right to reimbursement of the disability benefits it paid Burwell from Burwell’s Occupational Diseases Act award. Hoffmeister maintained this legislation does not provide for a reduction of SUES’ reimbursement to account for attorney fees. Therefore, Hoffmeister demanded the entire $6,954.66 be remitted to SUES. Pursuant to section 15 — 185 of the Code (Ill. Eev. Stat. 1987, ch. 108V2, par. 15 — 185), Hoffmeister threatened to withhold any future SUES benefits payable to Burwell or his beneficiary if Taylor did not comply with this request.

On August 23, 1985, Taylor paid SUES the full amount which it requested. However, Taylor stated he was doing so under protest and would “pursue litigation against the SUES” for his fee.

On September 26, 1985, Taylor filed a small claims complaint against SUES. On January 9, 1986, the circuit court dismissed Taylor’s small claims count, but granted Taylor leave to amend his complaint by adding a second count requesting administrative review of SUES’ denial of Taylor’s claim for fees.

SURS subsequently filed a motion requesting dismissal of Taylor’s administrative review count for lack of jurisdiction. SURS alleged (1) Taylor had not exhausted his administrative remedies, and (2) Taylor requested a money judgment against the State, in violation of the doctrine of sovereign immunity. On August 7, 1986, the court denied SURS’ motion to dismiss the administrative review count. On November 28, 1986, the circuit court granted Taylor’s motion for summary judgment and ordered SURS to pay him $1,390.93. SURS appealed this decision.

On appeal, this court held the circuit court lacked jurisdiction to entertain Taylor’s complaint in administrative review because there had been no final administrative decision. This court reversed the circuit court’s judgment and dismissed the cause. Taylor v. State Universities Retirement System (1987), 159 Ill. App. 3d 372, 512 N.E.2d 399.

Taylor subsequently requested an administrative decision by SURS’ Board of Trustees regarding his claim for attorney fees. Because there were no factual questions, the matter was immediately referred to the executive committee of SURS’ Board of Trustees for decision. In an order entered December 4, 1987, the executive committee denied Taylor’s claim for fees. The executive committee based its decision in part on a reimbursement agreement signed by Burwell, which contained the following language:

“I understand that disability benefits payable by the State Universities Retirement System must be offset by workmen’s compensation and occupational disease payments, and if I subsequently qualify for such payments, I agree to reimburse the State Universities Retirement System for the full amount of the overpayment of disability benefits within 60 days after receipt of the workmen’s compensation or occupational disease payments.”

As an additional basis for its decision, the executive committee cited the lack of any statutory provision for payment of attorney fees in this type of situation.

On December 18, 1987, Taylor filed a complaint for administrative review of the SURS executive committee’s decision. On May 16, 1988, SURS filed a motion to dismiss based on an alleged lack of subject-matter jurisdiction. SURS contended Taylor was seeking a money judgment against the State, in violation of the doctrine of sovereign immunity.

On August 31, 1988, the circuit court dismissed Taylor’s complaint for administrative review on the ground Burwell was a necessary party and had not been named as a defendant. The court granted Taylor leave to amend in order to add Burwell as a party. On September 7, 1988, Taylor amended his complaint by adding Burwell as a nominal party defendant, against whom he requested no specific relief. SUES subsequently adopted its previously filed pleadings.

In a memorandum opinion and order filed March 29, 1989, the court considered the issues raised in SUES’ motion to dismiss and concluded it had jurisdiction over the proceeding under the Administrative Eeview Law (Ill. Rev. Stat. 1987, ch. 110, par. 3 — 101 et seq.), because SUES had made a final administrative decision. The court further found SUES did not have specific statutory authority to seek reimbursement from Burwell of the disability benefits it had paid him, but in effect held SUES had implied authority to take such action because of the manifest legislative intent of preventing double recoveries of disability benefits in the form of both SUES disability payments and Occupational Diseases Act awards. Because of the lack of direct statutory authority for SUES obtaining reimbursement of disability benefits under the facts of this case, the court held SUES’ claim for reimbursement is analogous to an insurance subrogation claim. Therefore, the court concluded the “attorney trust fund” doctrine is applicable to this case and held SUES is liable to Taylor for attorney fees. Finally, the court held it could not order SUES to pay Taylor the attorney fees to which he is entitled, because that would amount to a money judgment against the State. The court concluded Taylor would have to pursue his claim for payment of attorney fees in the Illinois Court of Claims.

SUES contends the portion of the circuit court decision holding it liable to Taylor for attorney fees is erroneous, because SUES has no authority, express or implied, to pay attorney fees in this type of situation.

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Taylor v. STATE UNIVERSITIES RET. SYS.
560 N.E.2d 893 (Appellate Court of Illinois, 1990)

Cite This Page — Counsel Stack

Bluebook (online)
560 N.E.2d 893, 203 Ill. App. 3d 513, 148 Ill. Dec. 296, 1990 Ill. App. LEXIS 1018, Counsel Stack Legal Research, https://law.counselstack.com/opinion/taylor-v-state-universities-retirement-system-illappct-1990.