v.
City of Chicago Department of Administrative Hearings
Digitally signed by Reporter of Decisions Illinois Official Reports Reason: I attest to the accuracy and integrity of this document Supreme Court Date: 2018.01.11 14:15:46 -06'00'
Stone Street Partners, LLC v. City of Chicago Department of Administrative Hearings, 2017 IL 117720 Caption in Supreme STONE STREET PARTNERS, LLC, Appellee and Cross-Appellant, Court: v. THE CITY OF CHICAGO DEPARTMENT OF ADMINISTRATIVE HEARINGS et al., Appellants and Cross- Appellees. Docket No. 117720 Filed February 17, 2017 Rehearing denied May 22, 2017 Decision Under Appeal from the Appellate Court for the First District; heard in that Review court on appeal from the Circuit Court of Cook County, the Hon. Mark Ballard, Judge, presiding. Judgment Appellate court affirmed. Cause remanded. Counsel on Stephen R. Patton, Corporation Counsel, of Chicago (Benna Ruth Appeal Solomon, Myriam Zreczny Kasper, and Jonathon D. Byrer, Assistant Corporation Counsel, of counsel), for appellants. Mitchell B. Katten and Joshua R. Diller, of Katten & Temple LLP, and Richard F. Linden, both of Chicago, for appellee. Lisa Madigan, Attorney General, of Springfield (Carolyn E. Shapiro, Solicitor General, and John P. Schmidt, Assistant Attorney General, of Chicago, of counsel), amicus curiae. Douglas A. Darch, Michael A. Pollard, and Matthew M. Brown, of Baker & McKenzie LLP, of Chicago, for amici curiae the Society for Human Resource Management et al. Carla F. Garfinkle, of Northbrook, and Edwin E. Huddleson, of Washington, D.C., for amicus curiae American Automotive Leasing Association. Justices CHIEF JUSTICE KARMEIER delivered the judgment of the court, with opinion. Justices Thomas, Kilbride, and Garman concurred in the judgment and opinion. Justice Freeman dissented, with opinion, joined by Justices Burke and Theis. Justices Freeman, Burke, and Theis dissented upon denial of rehearing. OPINION ¶1 Stone Street Partners, LLC (Stone Street), brought this action in the circuit court of Cook County to obtain administrative review and declaratory and other relief, including an award of damages, after discovering that a judgment had been recorded against one of its properties for failure to pay $1050 in fines and costs imposed by the city of Chicago’s department of administrative hearings (the Department) for violation of various provisions of the city’s building code more than a decade earlier. Stone Street’s complaint, which named as defendants the city of Chicago, the Department and its director, and the city of Chicago’s department of buildings and the commissioner of that department (collectively the City), asserted that the original administrative proceedings were a nullity and could not serve as the basis for the judgment subsequently recorded against its property because, inter alia, it had not been given the requisite notice and therefore had no opportunity to contest the violations alleged by the City before judgment was entered against it. ¶2 Following a motion filed by the City pursuant to section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2012)), the circuit court rejected Stone Street’s cause of action in its entirety. The appellate court, with one justice partially dissenting, subsequently affirmed in part, reversed in part, and remanded for further proceedings. 2014 IL App (1st) 123654. We allowed the City’s petition for leave to appeal. Ill. S. Ct. R. 315 (eff. July 1, 2013).
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For the reasons that follow, the judgment of the appellate court is affirmed, and the cause is remanded to the circuit court for further proceedings.
¶3 BACKGROUND ¶4 The standards governing this appeal are well established. A motion to dismiss under section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2012)) admits the legal sufficiency of the complaint but asserts that some affirmative matter defeats the plaintiff’s claim. When reviewing whether a motion to dismiss under section 2-619 should have been granted, we may consider all facts presented in the pleadings, affidavits, and depositions found in the record. Doe A. v. Diocese of Dallas, 234 Ill. 2d 393, 396 (2009). All well-pleaded facts along with all reasonable inferences that can be drawn from those facts are deemed admitted, and all pleadings and supporting documents must be interpreted in the light most favorable to the nonmoving party. Bjork v. O’Meara, 2013 IL 114044, ¶ 21. Because section 2-619 motions present a question of law, we give no deference to the determinations by the lower courts. Our review is de novo. Doe A., 234 Ill. 2d at 396. ¶5 The record before us, when viewed according to the foregoing principles, establishes the following. Stone Street is a limited liability company created in 1998 and duly registered with the Illinois Secretary of State. Its registered agent is and has always been William G. Daluga, Jr. Mr. Daluga’s address is 200 W. Adams Street, Suite 2500, Chicago, Illinois 60606. According to state records, Stone Street’s principal office is located at 1343 N. Wells Street, ground level, Chicago, Illinois 60610. These addresses have been on file with the Secretary of State since 1998 and have never changed. ¶6 Stone Street owns real estate located at 44-46 E. Superior Street, Chicago, Illinois 60611.1 On March 19, 2009, the City recorded a judgment against that property. The judgment so recorded had actually been entered 10 years earlier, on September 9, 1999, following a hearing on that same date, by an administrative law officer in the City’s department of administrative hearings. The judgment was in the amount of $1050 and was based on the administrative officer’s determination that “Stone Street Partners” was liable for violation of various provisions of the City’s building code. One thousand dollars of this sum was a fine. Fifty dollars was for costs. ¶7 There is no evidence that Stone Street or anyone with authority to act on behalf of Stone Street had ever been notified of the building code violations that resulted in the 1999 judgment or the judgment itself, at any time prior to 2009. The “communication transmittal form” on which the building inspector had listed the violations to be addressed at the September 9, 1999, hearing showed that during the inspection, the owner was not present. Moreover, the document incorrectly identified the property’s owner as “1st Real Estate and Development.” ¶8 Issuance of the foregoing document apparently resulted after code violations discovered by City inspectors in the previous months remained uncorrected. However, neither that document nor the prior reports of violations were mailed to Stone Street’s office or the office of its registered agent, Mr. Daluga. The City destroyed most of the records regarding this matter, but the surviving materials indicate that the notices were actually mailed to Supera Properties,
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2001 N. Halsted Street, No. 301, Chicago, IL, 60614. Supera Properties was neither an agent nor a representative of Stone Street. Copies were apparently also sent to this address: Stone Street Partners, 44 E. Superior Street, Chicago, IL 60614. Forty-four E. Superior Street, however, was not Stone Street’s principal place of business, and Stone Street Partners is not the company’s name. The company is registered as Stone Street Partners, LLC, and its address was on N. Wells Street. The street name and number listed on the notice were actually those of the property where the violations were alleged to be, but even at that, the address was inaccurate. The zip code listed, 60614, was incorrect. The property owned by Stone Street is located in the 60611 zip code area. ¶9 While notice was never given to or received by Stone Street or its agents or representatives, a person named Keith Johnson entered a written appearance in the administrative proceeding that culminated in the fine against Stone Street. Johnson represented that he was there on behalf of Stone Street, but the address and phone number he gave corresponded to those of a business called “First Real Estate,” not Stone Street, and he left blank the section of the appearance form in which he was asked to state under oath that he was either the respondent/owner, lessee, attorney, or authorized agent/representative of Stone Street. [2] Although Johnson died before this litigation arose and therefore could not be questioned, the reason he refrained from selecting any of the options seems apparent. He could not do otherwise without committing perjury. Johnson was not employed by Stone Street and had no affiliation of any kind with the company. He did not even live in the subject property. So far as can be ascertained, he was merely the private caretaker for Philip Farley, the father of an attorney named Brian Farley, who was one of the members of Stone Street. ¶ 10 When Johnson was working for Philip in 1999, Philip, who is now also deceased, had suffered a stroke, was in ill health, and lacked the mental capacity to manage his own affairs. Due to his diminished mental capacity, Philip was not involved in the management or affairs of Stone Street and therefore could not have authorized Johnson to act on Stone Street’s behalf.[3] Moreover, there is no evidence that Stone Street or anyone associated with Stone Street ever took any action or made any representations that would indicate to others that Johnson had any
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authority to act on Stone Street’s behalf with respect to this or any other matter. To the contrary, Brian Farley, Philip’s son, stated unequivocally that he served as attorney for the company at the time and that if the company had been sent proper notice, he would have been the one to appear on the company’s behalf. According to Brian’s uncontested affidavit, Johnson had no authority to represent Stone Street, and the company “would not have sent a caretaker to defend the charges had it been properly provided with notice of this case.” ¶ 11 After Stone Street learned that a judgment had been recorded against the company’s property in 2009 based on the 1999 administrative judgment imposing the $1050 in fines and costs on “Stone Street Partners,” Brian Farley wrote to the City’s counsel in his capacity as Stone Street’s attorney to request that the judgment be released and that title to the property be cleared. When that effort proved unsuccessful, Stone Street sought relief from the City’s department of administrative hearings. Specifically, the company asked the Department to vacate and set aside the September 9, 1999, judgment on the grounds that the company had never received notice of the charges or of any orders entered in the case. The company further contended that the proceedings leading to the 1999 administrative judgment were fatally flawed because regardless of Johnson’s relationship (or lack thereof) with Stone Street, he was not a lawyer and could not appear for the company without violating the prohibition against the unauthorized practice of law. ¶ 12 By order dated December 9, 2011, the administrative law officer for the Department “struck” Stone Street’s request for relief with prejudice on the grounds that the Department no longer had jurisdiction to set aside the September 9, 1999, judgment. Thus rebuffed again, Stone Street turned next to the circuit court of Cook County. There, Stone Street filed the complaint that gave rise to this appeal. ¶ 13 Stone Street’s complaint contained four counts. Count I sought administrative review of the December 9, 2011, decision by the Department striking with prejudice its motion to vacate and set aside the 1999 administrative judgment. That count, which was predicated on the provisions of the Administrative Review Law (735 ILCS 5/3-101 et seq. (West 2012)), asserted, among other things, (1) that there was no legal or factual support for the Department’s decision and (2) that the Department erred in failing to consider, on the merits, its claims that the September 9, 1999, judgment was fatally flawed because Stone Street had not been given the requisite notice and opportunity to be heard in violation of the state and federal constitutions and because the judgment resulted from proceedings involving the unauthorized practice of law. ¶ 14 Count II of Stone Street’s complaint requested a declaratory judgment that the judgment recorded against its property in 2009 is null and void because the September 9, 1999, administrative judgment on which it is based (1) had expired, was not revived, and therefore was unenforceable under sections 12-101, 12-108, and 12-183 of the Code of Civil Procedure (735 ILCS 5/12-101, 12-108, 12-183 (West 2012)); (2) was the product of proceedings involving the unauthorized practice of law; and (3) was entered against a nonexistent entity, namely, Stone Street Partners rather than Stone Street Partners, LLC. Stone Street also complained that, in the 2011 administrative proceedings rejecting its efforts to vacate and set aside the 1999 judgment, the City was improperly represented by a private law firm rather than its own corporation counsel. Stone Street further contended that the City’s unlawful actions
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placed a cloud on its title to the subject property and that it should receive monetary compensation, including an award of attorney fees, for the resulting damages it sustained. ¶ 15 Count III of Stone Street’s complaint incorporated by reference the previous allegations but sought recovery for slander of title based on the additional charge that, in recording the September 9, 1999, administrative judgment and then refusing to take the necessary corrective action after being asked to do so by Brian Farley, the City had acted maliciously. Count IV claimed that the September 9, 1999, order imposing the $1050 in fines was void and unenforceable because the administrative complaint culminating in that order was neither drafted nor prosecuted by a licensed attorney and, in pursuing the complaint, the City was therefore engaged in the unauthorized practice of law. ¶ 16 The City moved to dismiss Stone Street’s cause of action in its entirety pursuant to section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2012)). Following a hearing, the circuit court entered an order granting the City’s motion as to the claims asserted in counts II, III, and IV of the complaint. With respect to count I, which sought administrative review, the court affirmed the December 9, 2011, judgment by the Department striking, for lack of jurisdiction, Stone Street’s challenge to the September 9, 1999, judgment imposing $1050 in fines and costs. ¶ 17 Stone Street appealed. As noted at the outset of this opinion, the appellate court affirmed in part, reversed in part, and remanded for further proceedings. 2014 IL App (1st) 123654. After reviewing the record and the applicable law, the appellate court concluded that Stone Street had not, in fact, been afforded the necessary notice and opportunity to be heard prior to entry of the September 9, 1999, judgment against it. Id. ¶ 13. It further opined that Stone Street cannot be deemed to have waived its objection to proper notice based on Johnson’s participation at the September 9 hearing. As grounds for this conclusion, the appellate court relied primarily on the fact that Johnson was not a licensed attorney. Citing a range of authorities, including this court’s recent decision in Downtown Disposal Services, Inc. v. City of Chicago, 2012 IL 112040, the appellate court held that nonattorneys cannot represent corporations in administrative hearings, particularly hearings of the type at issue here, “which involve testimony from sworn witnesses, interpretation of laws and ordinances, and can result in the imposition of punitive fines ***.” 2014 IL App (1st) 123654, ¶ 16. It further noted, however, that even if Johnson had been a licensed attorney, the result would have been the same because the record affirmatively showed that Johnson lacked authority to represent Stone Street in any capacity. Id. ¶ 21. ¶ 18 Once it reached this conclusion, the appellate court next considered how the lack of notice affected the viability of the various counts asserted by Stone Street in its complaint. No discussion was needed regarding count IV, which alleged unauthorized practice of law by the City, because Stone Street had decided not to pursue its challenge to the dismissal of that count. ¶ 19 With respect to count I, the court opined that notwithstanding the fatal defect in the September 9, 1999, proceedings and judgment, the Department had no authority to revisit that judgment and its 2011 order striking Stone Street’s motion to vacate was therefore properly upheld on review by the circuit court. Id. ¶ 25. The appellate court also concluded that the circuit court had correctly dismissed count III of Stone Street’s complaint, which alleged slander of title. The appellate court held that this claim was barred by section 2-107 of the
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Local Governmental and Governmental Employees Tort Immunity Act (745 ILCS 10/2-107 (West 2012)), which immunizes local public entities from liability for injury caused by any action of its employees that is libelous or slanderous. 2014 IL App (1st) 123654, ¶ 31. ¶ 20 The appellate court reached a different result with respect to count II, which sought declaratory and other relief. It held that Stone Street could not recover money damages under that count to the extent that such damages were premised on slander of title principles. As noted, the appellate court believed that the City was cloaked in statutory immunity with respect to such claims. Id. ¶ 28. At the same time, however, the appellate court concluded that because Stone Street’s complaint and related materials supported its claim that the 1999 administrative judgment was void because the requisite notice had not been given, Stone Street should be permitted to pursue equitable relief under count II in the circuit court. It therefore reversed in part as to that count and remanded to the circuit court for further proceedings. ¶ 21 One justice concurred in part and dissented in part. In her view, the circuit court’s dismissal of count II should have been affirmed in its entirety. Id. ¶¶ 43-45 (Connors, J., concurring in part and dissenting in part). She also disagreed with the majority’s discussions regarding the unauthorized practice of law by Johnson and the City. In addition, contrary to a view expressed by the majority, the partially dissenting justice believed that this case warranted issuance of a certificate of importance pursuant to Illinois Supreme Court Rule 316 (eff. Dec. [6], 2006). 2014 IL App (1st) 123654, ¶ 51 (Connors, J., concurring in part and dissenting in part). ¶ 22 The City petitioned our court for leave to appeal, which we allowed. Ill. S. Ct. R. 315 (eff. July 1, 2013). We have also permitted various parties to file friend of the court briefs under Illinois Supreme Court Rule 345 (eff. Sept. 20, 2010). The Illinois State Bar Association has filed a brief supporting Stone Street. The Attorney General of Illinois, the American Automotive Association, and a group including the Society for Human Resource Management have filed three separate briefs supporting the City. In addition, after the case was taken under advisement, we ordered supplemental briefing on the question of whether the notice of the building code violations and the 1999 administrative hearing was “adequate to acquire personal jurisdiction over Stone Street Partners, LLC, and satisfy due process.” That briefing has now been completed, and the matter is ready for a decision by this court.
¶ 23 ANALYSIS ¶ 24 The sole issue presented by the City’s appeal is whether the appellate court erred in concluding that count II of Stone Street’s should not have been dismissed in its entirety and that Stone Street should, instead, be permitted to proceed on the portions of count II that sought declaratory relief and elimination of the cloud on Stone Street’s title to its property on 44-46 E. Superior Street. As we have discussed, the basis for the appellate court’s ruling was that Stone Street had never been properly served with notice of the proceedings that resulted in the administrative judgment against it and that Johnson’s appearance at the September 9, 1999, administrative hearing could not cure that defect. In assailing the appellate court’s decision, the City focuses on the court’s holding that Johnson’s appearance could not operate as a waiver of the City’s failure to provide Stone Street with proper notice because he was a layperson and his participation in the proceedings violated the prohibition against the unauthorized practice of law.
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¶ 25 The City urges us to reject that holding because, in its view, administrative proceedings conducted by the Department do not require specialized legal skill and training and the rationale for the general rule that corporations must be represented by attorneys in legal proceedings is inapplicable to administrative proceedings such as those conducted by the Department. The City argues, in the alternative, that even if the representation of corporations in proceedings before the Department does involve the practice of law and Johnson’s conduct here would otherwise run afoul of the prohibition against the unauthorized practice of law, this court should invoke its inherent authority to regulate the practice of law and hold that lay representation of corporations in administrative proceedings of the type conducted by the Department is permissible. If we are not disposed to take that view and instead agree with the appellate court that lay representation of corporations in proceedings before the Department is prohibited, the City asks that we give that holding only prospective effect. ¶ 26 The City is entirely correct that Johnson’s status is central to the viability of the claims asserted by Stone Street in count II of its complaint. But for Johnson’s presence at the September 9, 1999, hearing, there would be no basis for holding that Stone Street had been given adequate notice and an opportunity to be heard with respect to the building code violations that were the predicate for the $1050 judgment recorded against its property. As we have indicated, the record is devoid of evidence that the City undertook the measures necessary to notify Stone Street of those violations in the manner and within the time required by law. Without such notice, the only way the subsequent proceedings could be given effect is if the lack of notice could be deemed to have been waived by someone with authority to waive it, and the only person who could possibly have effectuated such a waiver in this case is Johnson. ¶ 27 While Johnson’s role in the case is therefore critical, we disagree with the City that the viability of Stone Street’s cause of action turns on whether laypersons may represent corporations in administrative proceedings before the Department without violating the prohibitions against the unauthorized practice of law. In our view, resolving the issues of whether Johnson’s representation violated the ban on the practice of law by lay persons and, if so, whether such conduct should nevertheless be permitted in administrative proceedings before the Department is unnecessary for resolution of this case. The reason these issues need not be addressed was actually identified by the appellate court majority itself in its opinion: Johnson did not represent Stone Street in any capacity.[4] ¶ 28 A defendant does not waive objection to a tribunal’s exercise of jurisdiction based on the participation of a person who has not been authorized by the defendant, expressly or impliedly, to appear on its behalf, and there is no proof of ratification. That is so even if the purported representative is a licensed attorney. When the facts show a lack of authorization, the representative’s acts are a nullity against the party for whom the appearance was entered. 2014
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IL App (1st) 123654, ¶ 21 (citing Gray v. First National Bank of Chicago, 388 Ill. 124, 129 (1944)). ¶ 29 That is precisely the situation we have in this case. Not only is there no evidence—none—that Stone Street had authorized Johnson to represent it at the administrative hearing, there is no evidence that he had any relationship with Stone Street at all. To be sure, Johnson did fill out a form supplied by the Department on which he claimed to appear on behalf of the corporation. As we have previously noted, however, the Department’s form required the person completing it to specify, under oath, his relationship to the person or entity on whose behalf he purported to appear. Four choices were given: representative/owner, lessee, attorney, or authorized agent/representative. Mr. Johnson did not check any of these four options. ¶ 30 The form is straightforward and unambiguous. If Mr. Johnson left the four spaces blank because he did not understand what they meant, his capacity to understand the rest of the proceedings would be open to serious question. Even if one agreed with the City that the proceedings were so rudimentary that no “trained legal mind” was required, the bar for adequate representation is not so low that we will deem it satisfied by someone who cannot make a check mark on the simplest of forms. ¶ 31 While Johnson is now deceased and cannot be questioned regarding his conduct, it seems evident that the reason he left the form incomplete is that checking any of the choices would have opened him to charges of perjury. The evidence in the record clearly shows that Johnson was not, in fact, the respondent/owner of the subject property; he was not the lessee—the address he gave for himself was down the street from the subject property; he was not a lawyer at all, much less a lawyer for Stone Street; and he was not the corporation’s agent/representative. In fact, he did not work for Stone Street in any capacity. His only connection with the corporation was through Philip Farley, the now deceased elderly father of Brian Farley, the LLC’s lawyer and one of its members. The senior Mr. Farley was in ill-health, having suffered from a stroke, and he was not involved in the management or affairs of Stone Street due to his diminished mental capacity. Mr. Farley lacked sufficient mental capacity to manage even his own affairs. That is where Mr. Johnson came in. He served as Mr. Farley’s personal caretaker. To be clear, he was not the caretaker of the building. He was only the caretaker for Mr. Farley. ¶ 32 Why Mr. Johnson, a personal caretaker, would take it upon himself to appear at the September 1999 hearing on building code violations is unknown. Whatever responsibilities Johnson had with respect to the personal care of Mr. Farley, there is nothing in the record that would support a finding that he had any actual authority to act on behalf of Stone Street, the property’s owner. ¶ 33 Nor is there any basis for concluding that Johnson possessed even apparent authority to bind Stone Street. Apparent authority arises where a principal creates, through words or conduct, the reasonable impression that the putative agent has been granted authority to perform certain acts. State Security Insurance Co. v. Burgos, 145 Ill. 2d 423, 431-32 (1991). The idea behind the doctrine is that if the principal created the appearance of authority, it should be estopped from denying that authority where doing so would operate to the detriment of a third party. Id. at 432; O’Banner v. McDonald’s Corp., 173 Ill. 2d 208, 213 (1996). Nothing like that occurred here. At no time did Stone Street ever take any action, overtly or
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even through acquiescence, that could reasonably have been construed as conferring authority on Johnson to act on its behalf at the hearing or for any other purpose. And while a principal can ratify and thereby retroactively authorize an agent’s action by accepting the benefits of that action (Christopher B. Burke Engineering, Ltd. v. Heritage Bank of Central Illinois, 2015 IL 118955, ¶ 24), no such thing happened here either. ¶ 34 In the context of administrative hearings, due process of law specifically requires a definite charge, adequate notice, and a full and impartial hearing. Ellison v. Illinois Racing Board, 377 Ill. App. 3d 433, 444-45 (2007). These threshold requirements have been incorporated into the Illinois Municipal Code (65 ILCS 5/1-1-1 et seq. (West 2012)), which provides: “[p]arties shall be given notice of an adjudicatory hearing which includes the type and nature of the code violation to be adjudicated, the date and location of the adjudicatory hearing, the legal authority and jurisdiction under which the hearing is to be held, and the penalties for failure to appear at the hearing.” 65 ILCS 5/1-2.1-5(b) (West 2012). The Chicago Municipal Code likewise provides that “[b]efore any administrative adjudication proceeding may be conducted, the parties shall be afforded notice in compliance with this section” (Chicago Municipal Code § 2-14-074(a) (amended Apr. 29, 1998)) and that the issuer of the notice specify “his or her name and department; where known, the name and address of the person or entity charged with the violation; the date, time and place of the violation; and the section of the code or departmental rule or regulation which was allegedly violated; and shall certify the correctness of the specified information by signing his or her name to the notice. A notice of hearing shall also include the date, time and location of the hearing and the penalties for failure to appear at the hearing.” Chicago Municipal Code § 2-14-074(b) (amended Apr. 29, 1998). ¶ 35 To reiterate what we have already said, there is no dispute that Stone Street received no such notice with respect to the building code violations that gave rise to this litigation. The notice issued by the City was never served on the corporation’s registered agent or sent to the corporation’s principal place of business as required by section 2-14-074(c) of the Chicago Municipal Code (Chicago Municipal Code § 2-14-074(c) (amended Apr. 29, 1998)). As the appellate court correctly recognized (2014 IL App (1st) 123654, ¶ 14), the only possible way this fundamental lapse could be cured is if the lack of proper notice was subsequently waived by Johnson’s appearance at and participation in the hearing. As we have already explained, however, no such waiver can be imputed to Stone Street. Because it is manifest from the record before us that Johnson’s actions were neither authorized nor ratified by Stone Street, anything he did or failed to do at the hearing did not cure the City’s failure to properly serve the corporation. Issues regarding the unauthorized practice of law are immaterial. Even if Johnson had been an attorney, his lack of actual or apparent authority to act on Stone Street’s behalf and the absence of after-the-fact ratification of his conduct by Stone Street precludes any claim by the City that Johnson’s conduct operated as a waiver by Stone Street of the company’s objections to the City’s failure to notify it of the violations or the hearing thereon as required by law. ¶ 36 The notice requirements were jurisdictional prerequisites that the Department was required to follow in order for it to have authority to hear the case and adjudicate the charges against Stone Street. In re Abandonment of Wells Located in Illinois, 343 Ill. App. 3d 303, 307 (2003);
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see Newkirk v. Bigard, 109 Ill. 2d 28, 36 (1985). Because Stone Street was never properly served with notice and because Johnson had no authority to appear on the company’s behalf, the Department failed to acquire personal jurisdiction over it. The Department’s 1999 judgment imposing fines on Stone Street was therefore void ab initio and could be attacked at any time, either directly or collaterally. See In re Abandonment of Wells Located in Illinois, 343 Ill. App. 3d at 307; City of Chicago v. Fair Employment Practices Comm’n, 65 Ill. 2d 108, 112-13 (1976); Siddens v. Industrial Comm’n, 304 Ill. App. 3d 506, 511 (1999); People v. Smith, 275 Ill. App. 3d 844, 850-51 (1995). Accordingly, regardless of whether the Department could itself have set aside the void judgment in the context of the 2011 administrative proceeding, the judgment could have been set aside by the circuit court as Stone Street requested. The appellate court was therefore correct when it held that Stone Street should have been permitted to pursue its claims to quiet title and obtain declaratory relief to invalidate all proceedings premised on the void 1999 judgment and that the portions of count II seeking such relief should therefore not have been dismissed by the circuit court. ¶ 37 Stone Street has cross-appealed, arguing that the appellate court’s judgment should be affirmed for the additional reason that the 2009 judgment recorded against its property was null and void because the 1999 judgment on which it was based had expired by the time the City attempted to enforce it. Because we have already determined that the 1999 judgment was void and unenforceable for lack of notice, resolution of Stone Street’s additional basis for challenging that judgment would not alter the outcome of this case. Whether or not Stone Street’s argument is meritorious, the company may, on remand, pursue its claims to quiet title and obtain declaratory relief as set forth in count II of its complaint. The issue raised by Stone Street in its cross-appeal is therefore moot. See Commonwealth Edison Co. v. Illinois Commerce Comm’n, 2016 IL 118129, ¶ 10.
¶ 38 CONCLUSION ¶ 39 For the foregoing reasons, the judgment of the appellate court is affirmed, and the cause is remanded to the circuit court for further proceedings consistent with this opinion.
¶ 40 Appellate court affirmed. ¶ 41 Cause remanded.
¶ 42 JUSTICE FREEMAN, dissenting: ¶ 43 We granted the City’s petition for leave to appeal in this case to address the appellate court’s holding and the conflict it created regarding the representation of corporations in administrative proceedings. The majority does not address the unauthorized practice of law issue, finding it “immaterial” to the resolution of this case. Supra ¶ 35. I disagree. Not only does the majority not address this issue, it invalidates a final administrative order based on an incomplete and inadequate record. I cannot agree with this either. For the following reasons, I respectfully dissent. ¶ 44 The majority holds that, since the Department’s notice of the building code violations to Stone Street was deficient and Johnson’s appearance at the administrative hearing did not waive jurisdiction because Johnson was not authorized to represent Stone Street in any
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capacity, the Department’s 1999 judgment was void ab initio and Stone Street could pursue its claims to quiet title and obtain declaratory relief. Supra ¶¶ 29, 36. ¶ 45 I would hold that this court should not invalidate a final administrative order based on an incomplete and inadequate record such as the one here. Additionally, I would address the unauthorized practice of law issue and hold that the representation of a corporation at Department proceedings does not constitute the practice of law. ¶ 46 As the majority notes, personal jurisdiction, unlike subject-matter jurisdiction, can be waived. Belleville Toyota, Inc. v. Toyota Motor Sales, U.S.A., Inc., 199 Ill. 2d 325, 333 (2002); State Bank of Lake Zurich v. Thill, 113 Ill. 2d 294, 308 (1986). I disagree with the majority that we are able to discern from the record here that there was no waiver of jurisdiction. Its finding is based on a record that can only be described as woefully inadequate. The majority acknowledges that the City destroyed “most” of the administrative record, yet it is willing to invalidate a final administrative order based on the incomplete record that remains. [5] The majority’s conclusion is not only unwarranted but unwise. If we permit or even endorse such a practice here, the message we send to future litigants is that they can void an administrative agency’s final order based on an incomplete and inadequate record. This should not be. ¶ 47 I set forth below some additional facts to explain why I believe the record is inadequate to conclusively establish that no waiver of jurisdiction occurred. In June 1999, a City building inspector found numerous building code violations at Stone Street’s property at 44-46 East Superior Street in Chicago. To remedy the violations, Stone Street needed to install carbon monoxide detectors, remove garbage and debris from the rear of the building and from the ground floor rear hallway, install adequate lighting and exit signs in exit areas, recharge fire extinguishers, repair the rear door, and make arrangements to reinspect the property. The administrative law officer’s order from the August 12, 1999, hearing indicated that someone appeared on Stone Street’s behalf and that person claimed the violations had been corrected. [6] The property was reinspected, and the next hearing occurred on September 9, 1999. Keith Johnson appeared at that hearing, purportedly on behalf of Stone Street, and submitted two exhibits: a picture of a carbon monoxide detector that had been installed at the property and a copy of a contract for electrical work to be performed at the property. The contract was dated August 26, 1999, and was signed by “Phil Farley.” The administrative law officer’s order indicated that liability was contested and found Stone Street liable for five of the seven violations, resulting in a $1050 fine.[7] ¶ 48 On March 23, 2009, the Law Offices of Talan & Ktsanes, as special assistant corporation counsel for the City, sent a letter to Stone Street indicating that the City had recorded a lien against the property as a result of the Department’s 1999 judgment. The letter was addressed to Stone Street Partners, LLC, and sent to its principal place of business at 1343 N. Wells Street in Chicago. A copy of the Department’s 1999 judgment was included with the letter. An affidavit