Harl v. City of LaSalle

• Decision Date: 24 December 1980
• Docket Number: No. 80 C 4905.,80 C 4905.
• Citation: 506 F. Supp. 1067
• Parties: Nancy HARL, d/b/a Public House, Plaintiff, v. CITY OF LaSALLE and Mayor Aloysius A. Gunia, Liquor Commissioner, Defendants.
• Court: U.S. District Court — Northern District of Illinois

506 F. Supp. 1067

Nancy HARL, d/b/a Public House, Plaintiff, v. CITY OF LaSALLE and Mayor Aloysius A. Gunia, Liquor Commissioner, Defendants.

No. 80 C 4905.

United States District Court, N. D. Illinois, E. D.

December 24, 1980.

Gerald M. Hunter, Oglesby, Ill., for plaintiff.

William Swindal, Hinshaw, Culbertson, Moelmann, Hoban & Fuller, Chicago, Ill., for defendants.

MEMORANDUM OPINION AND ORDER

ASPEN, District Judge:

Plaintiff, Nancy Harl ("Harl"), brought this action against defendants, City of LaSalle ("LaSalle") and Aloysius Gunia ("Gunia"), the mayor and liquor commissioner of LaSalle, alleging that revocation of her liquor license by the defendants violated state and federal law. Federal jurisdiction is asserted pursuant to 42 U.S.C. § 1983 and 28 U.S.C. §§ 1331, 1343.

On January 21, 1980, Harl filed a complaint against LaSalle and Gunia in LaSalle County Circuit Court. Defendants moved for dismissal of the complaint and on July 10, 1980, Chief Judge Flood granted their motion, but allowed Harl leave to amend her complaint by August 15, 1980. Harl failed to amend her complaint in the alloted time period, and the Court, on its own motion, entered an order dismissing her complaint on September 3, 1980.¹ Harl initiated this federal action thereafter.² The matter is presently before this Court on defendants' motion to dismiss on the ground of res judicata.³

Examination of Harl's state and federal complaints reveal that they are strikingly similar. The federal complaint varies from the state complaint in three respects: the federal complaint alleges violations of 42 U.S.C. § 1983, denial of a hearing, and failure to receive written notice of Gunia's unfavorable decision on Harl's right to appeal.

In their motion to dismiss, defendants contend that since Judge Flood's September 3 dismissal of Harl's complaint for failure to timely amend her complaint was a final order, it precludes Harl's federal action on the basis of res judicata and full faith and credit. Harl, in turn, claims that Judge Flood's order was not final; hence, res judicata and full faith and credit do not apply.

Illinois Supreme Court Rule 273 provides:

Unless the order of dismissal or a statute of this state otherwise specifies, an involuntary dismissal of an action, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join an indispensable party, operates as an adjudication on the merits. (Emphasis added).

Ill.Rev.Stat.1977, ch. 110A, § 273. The Seventh Circuit recently construed Rule 273 in Gilbert v. Braniff International Corporation, 579 F.2d 411 (7th Cir. 1978). In Gilbert, plaintiffs originally brought suit in the Circuit Court of Cook County. The state court granted defendant's motion to dismiss, with leave given to amend the complaint within 28 days. Id. at 412. Rather than amend their state complaint, the Gilbert plaintiffs filed an action in the United States District Court based on the same operative facts and involving the same parties as the state suit. Because the state court granted plaintiffs leave to amend and the defendant did not seek the entry of an order dismissing the cause with prejudice, the Seventh Circuit held that the order of dismissal with leave to amend fell within the "otherwise specifies" exception to Illinois Supreme Court Rule 273. Id. at 413. Unlike Gilbert, Harl's complaint was not merely dismissed with leave to amend. In fact, the Gilbert court specifically distinguished an open-ended "order of dismissal with leave to amend" from an order of dismissal after a failure to amend; the court noting that the latter operated as a final order under Rule 273, id., citing Brainerd v. First Lake Co. National Bank of Libertyville, 1 Ill.App.3d 780, 275 N.E.2d 468 (2d Dist. 1971).

In Brainerd, the Illinois Appellate Court construed Rule 273 in a factual setting nearly identical to the present suit. There, the complaint was dismissed, but plaintiff was granted leave to amend. When the Brainerd plaintiff failed to amend as directed, the trial court dismissed his cause "with prejudice." 1 Ill.App.3d at 782, 275 N.E.2d at 469. Brainerd then initiated a second action based on the same facts. The trial court ruled that res judicata barred his claim. The Illinois Appellate Court held that the dismissal caused by Brainerd's failure to amend barred his second suit because the judgment order "with prejudice" did not fall within the Rule 273 exceptions and thus operated as an adjudication upon the merits of the case. Id. at 782, 275 N.E.2d at 469-70.

The only distinction between Brainerd and the instant case is that Judge Flood did not use the phrase "with prejudice" in his September 3 Order dismissing Harl's complaint. This distinction, however, is insignificant. Rule 273 clearly requires that since Harl's state court complaint was not dismissed for lack of jurisdiction, improper venue or failure to join an indispensable party,⁴ the order of dismissal operates as an adjudication on the merits, unless otherwise specified.⁵ Judge Flood did not "otherwise specify," and thus, by operation of Rule 273, a decision was rendered on the merits, regardless of his failure to use the words "with prejudice."⁶ See Campbell v. Harrison, 16 Ill.App.3d 570, 306 N.E.2d 643 (1st Dist. 1973).

The cases cited by plaintiff are inapplicable since they involve situations where trial courts dismissed cases with leave to amend without issuing any further order. As noted above, although Judge Flood's order of July 10 granted plaintiff leave to amend until August 15, his September 3 order provided Harl with no further leave to amend.⁷

The second and more difficult question raised by defendants' motion is whether matters not raised in the dismissed state complaint also are barred by res judicata. The only material differences between Harl's federal and state complaints is that her federal action is brought pursuant to 42 U.S.C. § 1983 and includes allegations regarding certain hearing demands and notice requirements. It is undisputed, however, that these new claims arise out of the same set of operative facts that formed the basis for Harl's state court action.

While it is clear that Harl could easily have raised the notice and hearing claims, along with the numerous other due process allegations raised in state court, it was unclear, until recently, whether she could have raised her § 1983 claim in the state court proceeding as well. In Martinez v. California, 444 U.S. 277, 283 n.7, 100 S.Ct. 553, 558 n.7, 62 L.Ed.2d 481 (1980), however, the Supreme Court held that state courts could exercise jurisdiction over § 1983 claims.⁸ Because the Supreme Court has construed § 1983 to permit state court jurisdiction and because the Illinois Appellate Court has held that Illinois courts may hear such actions, see Bohacs v. Reid, 63 Ill.App.3d 477, 20 Ill.Dec. 304, 379 N.E.2d 1372 (2d Dist. 1978); Alberty v. Daniel, 25 Ill.App.3d 291, 323 N.E.2d 110 (1st Dist. 1974), it is apparent that Harl could have raised her § 1983 claim, as well as her other factual allegations, in her state court complaint.

It is well settled that a final judgment on the merits precludes the parties or their privies from relitigating issues that were or could have been raised in that action. Allen v. McCurry, ___ U.S. ___, ___, 101 S.Ct. 411, 413, 66 L.Ed.2d 308 (1980); Cromwell v. County of Sac, 94 U.S. 351, 352, 24 L.Ed. 195 (1876); Lambert v. Conrad, 536 F.2d 1183, 1185 (7th Cir. 1976). It is unsettled, however, whether this long-standing and broad based res judicata doctrine applies to cases brought under § 1983. In a recent decision bearing directly on this question, the Supreme Court held that the rules of res judicata and collateral estoppel are generally applicable to § 1983 actions. Allen v. McCurry, ___ U.S. ___, 101 S.Ct. 411, 66 L.Ed.2d 308. In so holding, the Court based its decision on the legislative history of § 1983 and the strong policy considerations central to the doctrines of res judicata, collateral estoppel and federalism.

The Court noted that § 1983 created a new cause of action in order to add to the jurisdiction of the federal courts, not to subtract from that of state courts. Id. ___ U.S. at ___, 101 S.Ct. at 415. Moreover, the Court found that "nothing in the language or legislative history of § 1983 remotely expresses any congressional intent to contravene the common law rules of preclusion or to repeal the express statutory requirements of the predecessor of 28 U.S.C. § 1738 ... nor does it say anything about the preclusive effect of state-court judgments." Id. These factors take on added significance when viewed in light of the important concerns upon which the doctrines of res judicata and collateral estoppel are based. These doctrines not only reduce the burden of multiple lawsuits and unnecessary litigation while fostering reliance on adjudication, but also promote the comity between the state and federal courts that has been at the foundation of our judicial system since the days of the founding fathers. See Allen v. McCurry, ___ U.S. ___, ___, 101 S.Ct. 411, 415, 66 L.Ed.2d 308; Montana v. United States, 440 U.S. 147, 153, 99 S.Ct. 970, 973, 59 L.Ed.2d 210 (1979); Younger v. Harris, 401 U.S. 37, 43-45, 91 S.Ct. 746, 750-51, 27 L.Ed.2d 669 (1971).

Although the Supreme Court specifically has declined to rule upon whether a § 1983 claimant is precluded from litigating in federal court those issues that he might have raised but did not raise in previous litigation, Allen, ___ U.S. at ___ n.5, 101 S.Ct. at 415 n.5, that is the issue that now faces this Court. In light of the persuasive reasoning articulated by the Supreme Court in Allen, as summarized above, and the particular factual context in which the instant case arises, this Court is convinced that plaintiff should be precluded from relitigating her claims against defendants in a federal forum.

Because the court's decision rests primarily on the...