S.J. Groves & Sons Co. v. State

• Decision Date: 18 November 1982
• Docket Number: No. 56169,56169
• Citation: 67 Ill.Dec. 92,444 N.E.2d 131,93 Ill.2d 397
• Court: Illinois Supreme Court
• Parties: , 67 Ill.Dec. 92 S.J. GROVES & SONS COMPANY, Appellee, v. The STATE of Illinois, Appellant.

Page 131

444 N.E.2d 131

93 Ill.2d 397, 67 Ill.Dec. 92

S.J. GROVES & SONS COMPANY, Appellee, v. The STATE of Illinois, Appellant.

No. 56169.

Supreme Court of Illinois.

Nov. 18, 1982.

Rehearing Denied Jan. 28, 1983.

Thomas C. Clark, Theodore T. Davis, Corporate Counsel, Minneapolis, Minn., for appellee, S.J. Groves & Sons Co.

Tyrone C. Fahner, Atty. Gen., Chicago, for appellant; Patricia Rosen, Asst. Atty. Gen., Chicago, of counsel.

CLARK, Justice:

This action was brought by S.J. Groves & Sons Company against the State of Illinois in the circuit court of Peoria County on February 23, 1981, for an alleged breach of contract. The trial court granted a motion to dismiss filed by the State, finding that it lacked subject matter jurisdiction to entertain this action. An appeal was filed with the appellate court, where the decision of the circuit court was reversed (103 Ill.App.3d 538, 59 Ill.Dec. 215, 431 N.E.2d 716). The appellate court held that the State, in entering into a contract for highway construction, consented to be sued on that contract. We granted the defendant's petition for leave to appeal (73 Ill.2d R. 315(a)). We now reverse the appellate court and find that the circuit court properly dismissed the action.

Section 4 of article XIII of the 1970 Constitution abolished sovereign immunity. It provides: "Except as the General Assembly may provide by law, sovereign immunity in this State is abolished."

Pursuant to section 4 of article XIII the legislature enacted Public Act 77-1776 (Ill.Rev.Stat.1979, ch. 127, par. 801), which provides that the State may not be made a defendant or a party in any court except as set forth in the Court of Claims Act (Ill.Rev.Stat.1979, ch. 37, par. 439.1 et seq.). Public Act 77-1776 became effective on January 1, 1972, the same date section 4 of article XIII was to become effective (Ill. Const.1970, Transition Schedule, sec. 1(e)). As this court said in Sass v. Kramer (1978), 72 Ill.2d 485, 21 Ill.Dec. 528, 381 N.E.2d 975, the legislature, "acting under the authority of the 1970 Constitution, specifically prohibited making the State of Illinois a defendant or party in any court." 72 Ill.2d 485, 490, 21 Ill.Dec. 528, 381 N.E.2d 975.

Section 8(b) of the Court of Claims Act (Ill.Rev.Stat.1979, ch. 37, par. 439.8(b)) gives the Court of Claims exclusive jurisdiction over contract claims brought against the State of Illinois:

"The court shall have exclusive jurisdiction to hear and determine the following matters:

* * *

* * *

(b) All claims against the state founded upon any contract entered into with the State of Illinois." Ill.Rev.Stat.1979, ch. 37, par. 439.8(b).

The roots of sovereign immunity lie in the common law of England. The State of Illinois adopted the common law of England as it existed "prior to the fourth year of James the First." (Ill.Rev.Stat.1979, ch. 1, par. 801). In early English common law no action could be maintained against the Crown. (11 Halsbury's Laws of England par. 1401, at 743 (4th ed. 1976).) And as the United States Supreme Court pointed out in Feres v. United States (1950), 340 U.S. 135, 139, 71 S.Ct. 153, 156, 95 L.Ed. 152, 157:

"While the political theory that the King could do no wrong was repudiated in America, a legal doctrine derived from it that the Crown is immune from any suit to which it has not consented was invoked on behalf of the Republic and applied by our courts as vigorously as it had been on behalf of the Crown."

No suit could be brought against the King because no court could have jurisdiction over him. 1 W. Blackstone, Commentaries 242. The reasoning behind the sovereign being exempt from suit is that "there can be no legal right as against the authority that makes the law on which the right depends." (Kawananakoa v. Polyblank (1907), 205 U.S. 349, 353, 27 S.Ct. 526, 527, 51 L.Ed. 834, 836.) A petition of right developed for claims against the Crown as the sovereign began to assent to proceedings asserting legal or equitable rights in its own courts. (See 11 Halsbury's Laws of England par. 1411, at 747 (4th ed. 1976); 9 W. Holdsworth, A History of English Law 22 (1926).) While the petition could not compel the sovereign to satisfy a debt (Thomas v. Queen (1874), L.R. 10 Q.B. 31), the Bankers case in 1699 ((K.B.1699) 87 Eng.Rep. 500) allowed for the satisfaction of contractual debt through the petition. (Bankers deprived of their credit had been granted annuities by King Charles II under a covenant binding the King and his successors. Because the annuities were not being paid, the bankers sued by a petition of right for the debt owed them by the Crown.)

In the United States, sovereign immunity has been justified as a rule which embodies a policy that protects the State from interference in its performance of the functions of government and preserves its control over State coffers. Block, Suits Against Government Officers and the Sovereign Immunity Doctrine, 59 Harv.L.Rev. 1060, 1061 (1946).

Section 26 of article IV of the 1870 Illinois Constitution prevented the State from being subject to suit. Delegates to the constitutional convention expressed hesitancy at allowing the State to be exposed to an adversary proceeding in a court of law. (See 6 Record of Proceedings, Sixth Illinois Constitutional Convention 647 (hereinafter cited as Proceedings).) There was an expression among the delegates that an administrative hearing would protect the State against exaggerated claims while allowing for more flexibility than would be available under the rules of procedure in a court of law. See 6 Proceedings 647.

A Commission of Claims was created in 1877 to hear claims against the State (1877 Ill. Laws 64) with awards to be presented to the General Assembly for a final determination. The Act of 1877 was amended and expanded in 1889 and repealed by the Court of Claims Act of 1903 (1903 Ill. Laws 140).

The court had exclusive jurisdiction to hear claims against the State, and the legislature would only appropriate funds to pay awards in those cases where such a recommendation was issued by the Court of Claims. (1903 Ill.Laws 140-42.) The Court of Claims Act of 1917 repealed the previous act, substituted the Secretary of State for the Auditor of Public Accounts as ex officio secretary, but again gave the court exclusive jurisdiction to rule upon claims against the State. 1917 Ill.Laws 325-27.

In 1945 the legislature passed the Court of Claims Act of 1945; it was amended in 1951 and remained in a similar form until after the adoption of the 1970 Constitution. Its operation had been analogous to that of the court created by the 1903 act. See 6 Proceedings 647-59; Novoselsky and Peterson, State Immunity in Illinois: The Court of Claims, 15 De Paul L.Rev. 340 (1965).

The comments of the General Government Committee of the 1970 constitutional convention that proposed language abolishing sovereign immunity, except as provided by the legislature, are indicative of a clear intent to put aside an anachronistic doctrine (6 Proceedings 640) while leaving the legislature with the opportunity to establish the procedure for processing any claims against the State. 6 Proceedings 636.

The plaintiff correctly points out that in a growing number of other jurisdictions the doctrine of sovereign immunity has been held not to be applicable to contracts: South Carolina: Kinsey Construction Co. v. South Carolina Department of Mental Health (1978), 272 S.C. 168, 249 S.E.2d 900; North Carolina: Smith v. State (1976), 289 N.C. 303, 222 S.E.2d 412; Oklahoma: State Board of Public Affairs v. Principal Funding Corp. (Okl.1975), 542 P.2d 503; Iowa: Kersten Co. v. Department of Social Services (Iowa 1973), 207 N.W.2d 117; Missouri: V.S. DiCarlo Construction Co. v. State (Mo.1972), 485 S.W.2d 52; New Jersey: P.T.L. Construction Co. v. Department of Transportation (1972), 60 N.J. 308, 288 A.2d 574; Idaho: Grant Construction Co. v. Burns (1968), 92 Idaho 408, 443 P.2d 1005; Delaware: George & Lynch, Inc. v. State (Del.1964), 7 Storey 158, 197 A.2d 734; California: Souza & McCue Construction Co. v. Superior Court (1962), 57 Cal.2d 508, 370 P.2d 338, 20 Cal.Rptr. 634; Colorado: Ace Flying Service, Inc. v. Colorado Department of Agriculture (1957), 136 Colo. 19, 314 P.2d 278; Montana: Meens v. State Board of Education (1954), 127 Mont. 515, 267 P.2d 981; Nebraska: Todd v. Board of Educational Lands & Funds (1951), 154 Neb. 606, 48 N.W.2d 706; Michigan: Hersey Gravel Co. v. State (1943), 305 Mich. 333, 9 N.W.2d 567; Georgia: Regents v. Blanton (1934), 49 Ga.App. 602, 176 S.E. 673; Indiana: Carr v. State ex rel. DuCoetlosquet (1891), 127 Ind. 204, 26 N.E. 778. The rationale behind many of those decisions is that when a State voluntarily enters into a contractual relationship, it impliedly consents to be sued on that contract. In none of those jurisdictions, however, was immunity provided for by the legislature pursuant to the kind of express language of section 4 of article XIII of the 1970 Illinois Constitution.

The plaintiff argues that the General Assembly, in authorizing the State to enter into contracts for the construction of highways (Ill.Rev.Stat.1979, ch. 121, par. 4-201.4), is consenting to be sued on those contracts. The plaintiff contracted with the Department of Transportation for highway construction work that called for earthmoving, grading, clearing and paving on the part of the plaintiff. The language on which it relies is that giving the Department of Transportation the power to "enter into contracts covering all matters and things incident to the location, relocation, construction, repair and maintenance of State highways." Ill.Rev.Stat.1979, ch. 121, par. 4-201.4.

The plaintiff is correct in asserting that both parties to a contract must be bound for the agreement to be a valid contract. While there must be mutuality of obligation between contracting parties (Welsh v. Jakstas (1948), 401 Ill. 288, 82 N.E.2d 53; Allied...