Norberg v. Centex Homes Corp.

• Decision Date: 22 January 1993
• Docket Number: No. 1-91-2498,1-91-2498
• Parties: , 186 Ill.Dec. 710 Gordon L. NORBERG, Plaintiff, v. CENTEX HOMES CORPORATION, Defendant and Third Party Plaintiff Appellee (R & D Thiel, Inc., Third Party Defendant-Appellant).
• Court: United States Appellate Court of Illinois

Page 1342

616 N.E.2d 1342

247 Ill.App.3d 267, 186 Ill.Dec. 710

Gordon L. NORBERG, Plaintiff, v. CENTEX HOMES CORPORATION, Defendant and Third Party

Plaintiff Appellee (R & D Thiel, Inc., Third Party

Defendant-Appellant).

No. 1-91-2498.

Appellate Court of Illinois,

First District, Sixth Division.

Jan. 22, 1993.

As Modified on Rehearing April 30, 1993.

[247 Ill.App.3d 268] [186 Ill.Dec. 711] Greenberg, Keele, Lunn & Aronberg, Chicago (Mitchell S. Goldgehn and Gene H. Hansen, of counsel), for appellant.

Baker & McKenzie, Chicago (Francis D. Morrissey, Michael A. Pollard, Richard B. Foster, III and Moira Ann Dages, of counsel), for appellee.

MODIFIED ON REHEARING

Justice EGAN delivered the opinion of the court:

The plaintiff, Gordon L. Norberg, filed suit against the defendant, Centex Homes Corporation (Centex), to recover damages for personal injuries he suffered while working as a carpenter at a building site being developed by Centex. Centex filed a third-party complaint against the plaintiff's employer, R & D Thiel, Inc. (Thiel) for contribution.

At the time of the plaintiff's injury, Thiel had been insured under a workers' compensation and employer's liability policy with Optimum Insurance Company (Optimum). However, Optimum was placed in liquidation, and the Illinois Insurance Guaranty Fund (Fund) undertook Optimum's obligations with respect to the defense and indemnification of Thiel.

The case was heard by a jury. The evidence established that the plaintiff was working for Thiel as a trim carpenter installing permanent railings around a stairwell opening on the second floor of a townhouse. There was no temporary guardrail around the stairwell. The contract between Centex and Thiel expressly provided that Thiel was responsible for erecting a temporary guardrail around the stairwell opening. The plaintiff had not been instructed by Thiel to have a temporary guardrail in place while he installed the permanent guardrail. While the plaintiff was drilling a hole at the top of the stairwell, he slipped and fell down the stairs and was injured.

The jury returned a verdict on April 16, 1991, in favor of the plaintiff and against Centex. The jury calculated the plaintiff's damages to be $380,438.24, but found the plaintiff 20% contributorily negligent. Accordingly, they awarded $304,350.59 to the plaintiff. The jury also returned a verdict on Centex's third-party complaint and held Thiel 50% liable for the judgment.

On April 18, 1991, the plaintiff requested that a written judgment order be entered nunc pro tunc confirming the jury verdict that had been rendered on April 16. The judge granted the request and signed the written judgment order on April 18.

Also on April 18 the Illinois Supreme Court filed its opinion in Kotecki v. Cyclops Welding Corp. (1991), 146 Ill.2d 155, 166 Ill.Dec. 1, 585 N.E.2d 1023, holding that an employer's liability for contribution is limited to the extent of its workers' compensation liability. That same day, Thiel filed a motion to conform the judgment to reflect the holding of Kotecki and a motion to limit Centex's recovery to the amount allowed under the Illinois Insurance Guaranty Fund Act. (Ill.Rev.Stat.1989, ch. 73, par. 1065.82 et seq.) The judge denied both motions; he held that the Kotecki decision would apply prospectively to cases that began trial on or after April 18, 1991, and would not apply retroactively to cases in which trial had begun before April 18, 1991.

Centex settled with the plaintiff for $260,000, reserving its right of contribution from Thiel. The trial judge reviewed the settlement and entered a finding under the Contribution Act (Ill.Rev.Stat.1989, ch. 70 par. 301 et seq.) that the settlement was in good faith.

Thiel first maintains that Kotecki should be applied retroactively, and Centex maintains that Thiel has waived its right to contest the limits of contribution liability of an employer because Thiel did not raise the claim until after the jury verdict.

We note initially that both sides have taken inconsistent positions. In urging that Thiel has waived the argument, Centex contends that Thiel should have been aware of its right to claim a limitation on the extent of its liability for contribution before Kotecki was decided. On the other hand, in arguing that Kotecki should be given prospective application, Centex insists that Kotecki was in fact new law. Thiel insists that it did not waive its right to raise its argument until after the trial because it could not have anticipated the Kotecki opinion. But, in arguing that Kotecki should have retrospective application, Thiel maintains that Kotecki was not a change in the law but rather an "evolution" of the law.

We believe that Centex's claim that Thiel waived its argument here is not to be dismissed lightly, particularly when we consider the concession made by Thiel, perhaps unwittingly, in its brief in this court:

"While litigants did not know the result prior to its filing, the Kotecki decision came as no great surprise. Undoubtedly, Defendant Centex's counsel was, like the rest of the Illinois trial bar, monitoring this decision. That Centex finds the decision not to its liking is no surprise, but Kotecki is applicable to this case." (Emphasis added.)

We further judge, however, that if waiver is present here, we should not invoke it.

The Kotecki opinion was published on April 18, 1991. It did not say expressly whether its application was to be prospective or retroactive. The opinion was without a dissent. Two justices abstained from participating. On May 9, the third party plaintiff filed a petition for rehearing and alternatively requested that the opinion be modified to provide expressly that it was to apply only prospectively. On December 2, the supreme court denied the petition for rehearing with one justice dissenting and again with two justices abstaining from participating. The dissenting justice said that the opinion at least should address the question of whether the application of the opinion should be applied retroactively or prospectively. Kotecki, 146 Ill.2d at 174, 166 Ill.Dec. 1, 585 N.E.2d 1023 (Freeman, J., dissenting).

In Hux v. Raben (1967), 38 Ill.2d 223, 230 N.E.2d 831, the supreme court said that the responsibility of a reviewing court for the maintenance of a sound and uniform body of precedent may override the considerations of waiver. We are not concerned here with the maintenance of a precedent but rather with the establishment of a precedent. Nonetheless we believe the rationale of Hux v. Raben is applicable here. The time of the application of Kotecki must be decided sometime by a reviewing court. Moreover, if we held that Thiel had waived the argument and the supreme court disagreed with our holding, it is not unlikely that the supreme court would remand the case to this court for the resolution of all remaining issues. (Cf. Waste Management of Illinois, Inc. v. Illinois Pollution Control Board (1991), 145 Ill.2d 345, 165 Ill.Dec. 875, 585 N.E.2d 606.) For the sake of finality, therefore, we will disregard any possible waiver of Thiel's right to claim the application of Kotecki, and we will decide whether Kotecki should be applied prospectively or retroactively.

Thiel maintains that decisions are to be applied retroactively "unless the court expressly declares that its decision is a clear break with the past, such as when a court explicitly overrules its own past precedent, disapproves a practice * * * it * * * previously approved or overturns a well-established body of lower court authority," citing Larrance v. Illinois Human Rights Comm'n (1988), 166 Ill.App.3d 224, 230, 117 Ill.Dec. 36, 41, 519 N.E.2d 1203, 1208. A case is generally governed by the law as it exists when the judgment is rendered, not when the case is brought. GTE Automatic Electric, Inc. v. Allphin (1976), 38 Ill.App.3d 910, 913, 349 N.E.2d 654, 657, aff'd (1977), 68 Ill.2d 326, 12 Ill.Dec. 134, 369 N.E.2d 841.

However, courts have inherent power to determine whether their decisions should be applied prospectively or retroactively. (Larrance, 166 Ill.App.3d at 230, 117 Ill.Dec. 36, 519 N.E.2d 1203.) Whether a decision will be limited to prospective application depends upon whether the decision establishes a new principle of law, either by overruling clear past precedent on which litigants may have relied, or by deciding an issue of first impression whose resolution was not clearly foreshadowed. (Elg v. Whittington (1987), 119 Ill.2d 344, 116 Ill.Dec. 252, 518 N.E.2d 1232.) If the decision establishes a new principle of law, the court should balance both sides of the issue in question by determining whether prospective application will advance or hinder the purpose of the rule, and the court should also consider whether there is any injustice or hardship in holding the decision retroactive. Castaneda v. Illinois Human Rights Comm'n (1989), 132 Ill.2d 304, 329, 138 Ill.Dec. 270, 281, 547 N.E.2d 437, 448.

Before the Kotecki case was decided, the Supreme Court held that contribution claims against employers were not barred by the Workers' Compensation Act (Ill.Rev.Stat.1981, ch. 48, par. 138.1 et seq.). (Doyle v. Rhodes (1984), 101 Ill.2d 1, 77 Ill.Dec. 759, 461 N.E.2d 382.) The court in Doyle added the following:

"In this connection, however, we feel compelled to invite the attention of the parties to the possible relevance of the provisions of section 5(b) of the Workers' Compensation Act (Ill.Rev.Stat.1981, ch. 48, par. 138.5(b)). * * * The extent to which any right of contribution from the employer under the Contribution Act may impact upon this right of recoupment by the employer has not been raised by the parties in their pleadings and consequently not briefed. At this point, absent the assistance of any guidance by the third-party plaintiff and the employer, and bearing in mind that this case is still at the pleading stage, we are not prepared to indicate how this ...