Reeves v. Baltimore & Ohio R.R. Co.

• Citation: 526 N.E.2d 404,171 Ill.App.3d 1021,122 Ill.Dec. 145
• Decision Date: 20 June 1988
• Docket Number: No. 87-2070,87-2107,87-2070
• Parties: , 122 Ill.Dec. 145 Darrell E. REEVES, Plaintiff, v. The Baltimore & Ohio Railroad Company, and Iowa Mold Tooling Company, et al., Defendants (The Baltimore & Ohio Railroad Company, Third-Party/Plaintiff- Appellant; Mize Construction, Inc., Third-Party/Defendant-Appellee).
• Court: United States Appellate Court of Illinois

Page 404

526 N.E.2d 404 171 Ill.App.3d 1021, 122 Ill.Dec. 145 Darrell E. REEVES, Plaintiff,
v.
The Baltimore & Ohio Railroad Company, and Iowa Mold Tooling
Company, et al., Defendants (The Baltimore & Ohio Railroad
Company, Third-Party/Plaintiff- Appellant; Mize
Construction, Inc., Third-Party/Defendant-Appellee). No. 87-2070, 87-2107. Appellate Court of Illinois,
First District, First Division. June 20, 1988.

Page 405

[171 Ill.App.3d 1023] [122 Ill.Dec. 146] Lord, Bissell & Brook, Chicago, Thomas J. Healey, Hugh C. Griffin, Paul J. Peralta, of counsel, for appellant Baltimore & Ohio R.R. Co.

Wildman, Harrold, Allen & Dixon, Chicago, Robert E. Haley, Michael R. Blankshain, of counsel, for appellant Iowa Mold Tooling Co.

Querrey & Harrow, Ltd., Chicago, Michael Resis, Victor J. Piekarski, of counsel, for appellee Mize Const.

Justice QUINLAN delivered the opinion of the court:

On February 19, 1980, the plaintiff, Darrell Reeves (Reeves) filed a suit in the circuit court of Cook County for personal injuries he sustained when the crane unit he was working on tipped and fell off of a trestle. The injury took place on March 27, 1979 in Cincinnati, Ohio, while Reeves was an employee of Mize Construction, Inc. (Mize). Reeves filed suit against numerous parties, including the Baltimore and Ohio Railroad Company (B & O) and Iowa Mold Tooling Company (IMTCO) on the basis of products liability. B & O filed a third-party complaint against Mize on December 19, 1986, premised upon strict liability, express indemnity and contribution. Mize, after filing a special and limited appearance, moved to quash and dismiss the third-party complaint for lack of personal jurisdiction. The trial court granted Mize's motion on May 26, 1987. B & O appeals that ruling. ^*

In 1971, Mize was incorporated in the state of Indiana. On September 9, 1978, B & O and Mize entered into a contract (the contract was not in anyway connected to Illinois, i.e., the negotiation, performance, and execution did not occur in Illinois) under which Mize was to remove B & O tracks in Ohio. On March 27, 1979, Reeves, a Mize employee, was injured while in Ohio on the B & O/Mize job. B & O claimed [171 Ill.App.3d 1024] that Mize's relevant contacts with Illinois were sufficient to constitute doing business in Illinois. Mize's business contacts with Illinois were established as involving substantially the following percentages of business during the years set forth below:

Page 406

 [122 Ill.Dec. 147] Percentages of gross revenue
                derived from Illinois work
                1979 5"10%
                1980 5"10%
                1981 5"6%
                1982 0"2%
                1983"86 0%
                

Since 1982, Mize has done no work in Illinois and has derived no income from Illinois jobs. In fact, since 1983, Mize has been out of business. A successor corporation, Pine Construction, Inc. was formed. Pine is not in the construction business, and had no contacts with Illinois. Mize never had, and, of course, does not now have, an office in Illinois, a registered agent, nor did it have or does it now own any real estate in Illinois.

The issue raised by B & O on appeal concerns whether Mize was "doing business" in Illinois during the claimed relevant period of time which B & O contends was when its cause of action arose or, in any event, when the underlying action was filed in Cook County. If so, B & O asserts that the Illinois courts then had personal jurisdiction over Mize. Consequently, B & O contends that the trial court erred when it granted Mize's motion to quash and dismiss B & O's claim against Mize for lack of personal jurisdiction because, B & O claims, Mize was clearly "doing business" in Illinois during these relevant time periods.

The burden of asserting personal jurisdiction over a nonresident defendant rests on the party who asserts that jurisdiction exists. (R.W. Sawant & Co. v. Allied Programs Corp. (1986), 111 Ill.2d 304, 95 Ill.Dec. 496, 489 N.E.2d 1360.) Thus, it was B & O's burden to show that the constitutional requirement of minimum contacts, in accordance with due process, had been met, and specifically, B & O had to have alleged facts in its complaint upon which jurisdiction could be found over the nonresident defendant. See Heller Financial v. Sullivan (1988), 166 Ill.App.3d 1, 117 Ill.Dec. 571, 520 N.E.2d 922; Bobka v. Cook County Hospital (1983), 117 Ill.App.3d 359, 360-61, 73 Ill.Dec. 3, 4-5, 453 N.E.2d 828, 829-30.

An examination of B & O's third-party complaint reveals absolutely no allegations of facts upon which Illinois courts could base jurisdiction. This failure to include factual allegations of Mize's acts in Illinois is, in and of itself, fatal to B & O's claim. (See Heller Financial, 166 Ill.App.3d 1, 117 Ill.Dec. 571, 520 N.E.2d 922.) Hence, B & O's lack of proper [171 Ill.App.3d 1025] allegations in its third-party complaint provides a separate and independent basis for dismissal of the third-party complaint other than that found by the trial court.

Nevertheless, while this failure to allege sufficient jurisdictional facts would normally be fatal to B & O's assertions, we will also examine B & O's other contentions concerning the asserted jurisdictional basis for its claim against Mize, because, inasmuch as Mize never raised such an argument itself, the interests of justice require such an examination. (See Parks v. McWhorter (1985), 106 Ill.2d 181, 88 Ill.Dec. 9, 478 N.E.2d 324,...