E & B Marketing Enterprises, Inc. v. Ryan

• Decision Date: 05 February 1991
• Docket Number: No. 1-90-0078,1-90-0078
• Citation: 568 N.E.2d 339,209 Ill.App.3d 626,154 Ill.Dec. 339
• Parties: , 154 Ill.Dec. 339 E & B MARKETING ENTERPRISES, INC., Plaintiff-Appellant, v. James W. RYAN, M.D., Defendant-Appellee.
• Court: United States Appellate Court of Illinois

Page 339

568 N.E.2d 339

209 Ill.App.3d 626, 154 Ill.Dec. 339

E & B MARKETING ENTERPRISES, INC., Plaintiff-Appellant, v. James W. RYAN, M.D., Defendant-Appellee.

No. 1-90-0078.

Appellate Court of Illinois,

First District, Second Division.

Feb. 5, 1991.

Dowd & Dowd, Ltd., Chicago (Joel Ostrow and Michael E. Dowd, of counsel), for defendant-appellee.

Meyers, Kremin, Bledsoe & Tuohy, Chicago (Michael N. Bledsoe and Luke T. Ohrn, of counsel), for plaintiff-appellant.

Justice DiVITO delivered the opinion of the court:

Plaintiff E & B Marketing Enterprises, Inc. (E & B) appeals the dismissal of its amended complaint against defendant James E. Ryan, M.D. (Ryan). The appeal presents as issues (1) whether the complaint was barred by res judicata, and (2) whether the circuit court erred in concluding that the contract sued upon was void.

E & B initially filed an action for an accounting in the chancery division of the circuit court of Cook County. That suit was dismissed for want of prosecution on February 4, 1988. On April 6, 1989, E & B filed this action alleging breach of contract in the law division.

The contract underlying this suit was executed on March 1, 1983. Pursuant to its terms, E & B, a marketing firm located in Des Plaines, agreed to promote by various marketing techniques the name and practice of Ryan, a medical doctor engaged in private practice in Des Plaines. In return for its services, E & B was to "receive a consultant's fee of 10% on all billings collected by [Ryan] in connection with such referrals." This marketing campaign was targeted primarily at insurance carriers.

The complaint alleged that E & B procured numerous corporate clients who referred their claims to Ryan, who made payments to E & B in accordance with the written agreement from March 1983 through May 1984. In May 1984, Ryan informed E & B that he would make no further payments under the contract. This suit followed.

After Ryan filed a motion to dismiss, the circuit court requested additional arguments on the legality of the contract. E & B thereafter submitted an amended response to the motion to dismiss, to which Ryan replied. Oral arguments were heard on November 29, 1989. At this hearing, E & B's oral motion to file an amended complaint was granted. After hearing arguments of counsel, the circuit court found that the contract was void in that it constituted illegal fee-splitting which was prohibited by section 16(14) of the Medical Practice Act. (Ill.Rev.Stat.1985, ch. 111, par. 4433(14).) Accordingly, the court granted Ryan's motion to dismiss.

I.

Ryan maintains that because E & B's initial suit was dismissed, the complaint at issue in this case is barred on the basis of res judicata. The circuit court rejected the res judicata argument, and so do we. The initial action for an accounting was dismissed for want of prosecution; the subsequent breach of contract action was filed within the remaining statute of limitations period.

The Illinois Code of Civil Procedure states that if an action is dismissed for want of prosecution, a plaintiff may commence a new action within one year or within the remaining period of limitation, whichever is greater and regardless of whether the time limitation for bringing such action expires during the pendency of such claim. (Ill.Rev.Stat.1987, ch. 110, par. 13-217.) The statute of limitations on actions involving written contracts is ten years. (Ill.Rev.Stat.1987, ch. 110, par. 13-206.) E & B's filing of the breach of contract complaint was plainly within the statutorily required period.

Furthermore, as E & B correctly notes, dismissal for want of prosecution "is not an adjudication on the merits, does not prejudice the case of the party against whom it is entered, and does not bar a subsequent suit on the same issues." (Kraus v. Metropolitan Two Illinois Center (1986), 146 Ill.App.3d 210, 212, 100 Ill.Dec. 15, 496 N.E.2d 1080.) Thus, because E & B promptly filed this action after the dismissal of the other suit and because there had been no adjudication on the merits, Ryan's res judicata argument fails.

II.

E & B contends that the circuit court erred in voiding the contract upon which its suit was based. It argues that its contract with Ryan did not amount to illegal fee-splitting and is not prohibited by section 16(14) of the Medical Practice Act (the Act). (Ill.Rev.Stat., 1985, ch. 111, par. 4433(14).) Ryan responds that the contract is in direct contravention of the Act and violative of public policy.

The Medical Practice Act is a series of regulations directed at physicians and administered by the Department of Registration and Education. It states, in pertinent part:

"The Department may revoke, suspend, place on probationary status, or take any other disciplinary action as the Department may deem proper with regard to the license, certificate or state hospital permit of any person issued under this Act or under any other Act in this State to practice medicine, * * * upon any of the following grounds:

14. Directly or indirectly giving to or receiving from any physician, person, firm or corporation any fee, commission, rebate or other form of compensation for any professional services not actually and personally rendered * * *." Ill.Rev.Stat., 1985, ch. 111, par. 4433(14). ¹

Subsection 14 was added as an amendment to the Act on July 31, 1971. Though legislative debates from the Illinois House and Senate were not available for public recording and publication until October 1971, legislative intent can be derived from the plain words of the Act.

E & B contends that the instant contract is valid because it is not expressly prohibited by the Act. In support of its position, E & B draws an analogy between the statute at issue and section 28-7 of the Criminal Code, (Ill.Rev.Stat.1987, ch. 38, par. 28-7), which explicitly makes all gambling contracts void. E & B argues that because the legislature expressly set out its intention to invalidate gambling contracts, but did not expressly invalidate the type of contract involved here, there is a clear implication that the latter was not intended to be invalid. We disagree. A statute need not expressly declare a particular contract void to render it...