Sawyer Realty Group, Inc. v. Jarvis Corp.

• Decision Date: 18 December 1980
• Docket Number: No. 79-2085,79-2085
• Citation: 47 Ill.Dec. 560,415 N.E.2d 565,91 Ill.App.3d 1134
• Parties: , 47 Ill.Dec. 560 SAWYER REALTY GROUP, INC., Elegant Motor Cars, Inc. et al., Plaintiffs- Appellants, v. JARVIS CORPORATION, Harris Trust & Savings Bank et al., Defendants-Appellees.
• Court: United States Appellate Court of Illinois

Page 565

415 N.E.2d 565

91 Ill.App.3d 1134, 47 Ill.Dec. 560

SAWYER REALTY GROUP, INC., Elegant Motor Cars, Inc. et al., Plaintiffs- Appellants, v. JARVIS CORPORATION, Harris Trust & Savings Bank et al.,

Defendants-Appellees.

No. 79-2085.

Appellate Court of Illinois, First District, Fourth Division.

Dec. 18, 1980.

Bernard Kaplan, Scott E. Tuckman, Skokie, of counsel; Ruben, Kaplan & Rosen, Skokie, for defendants-appellees.

JIGANTI, Justice.

The primary issue here is whether a civil action for damages lies for a violation of the Illinois Real Estate Brokers and Salesmen License Act. (Ill.Rev.Stat. 1977, ch. 111, par. 5701 et seq.) (Brokers Act.) Although the Act does not expressly provide for a private right of action, the plaintiffs contend that one should be implied. The plaintiffs appeal from an order which we interpret as a dismissal of Count I of their complaint.

The complaint alleges that the owners of certain real estate listed it for sale with the defendant real estate brokers. The plaintiffs were prospective purchasers who entered into negotiations with the defendant brokers for the purchase of the property. The plaintiffs contend that during these negotiations they revealed confidential information concerning their willingness and ability to buy the land. The defendants advised the plaintiffs as to the terms and provisions which would be acceptable to the owners. Based on this advice, the plaintiffs prepared and submitted an offer. Shortly thereafter the defendants told the plaintiffs that the owners rejected their offer and sold the property to "others." The plaintiffs subsequently learned that the defendants had purchased the property. The plaintiffs alleged that this conduct constituted a violation of section 15(f) of the Brokers Act and also of sections V(A) and (C) of the rules and regulations promulgated by the Department of Registration and Education pursuant to the Act.

The plaintiffs argue that a private right of action may be founded on violations of statutes and regulations promulgated under those statutes. Specifically, the plaintiffs argue that a private cause of action should be implied for the defendant's alleged violation of the Brokers Act.

Implying a private cause of action for the violation of a statute which does not expressly provide for one has been the subject of numerous decisions and law review articles. (See Note, Implying Civil Remedies from Federal Regulatory Statutes, 77 Harv.L.Rev. 285 (1963); Comment, Implication of A Private Right of Action Under Title IX of the Education Amendments of 1972, 73 Nw.L.Rev. 772 (1978).) The problems with implying civil remedies where none are expressly included are summarized by the dissenting opinions in Cannon v. University of Chicago (1979), 441 U.S. 677, 99 S.Ct. 1946, 60 L.Ed.2d 560, and Kelsay v. Motorola, Inc. (1978), 74 Ill.2d 172, 23 Ill.Dec. 559, 384 N.E.2d 353. In Cannon, Justice Powell expressed the view that the implication of civil remedies allows the judiciary to assume policy-making authority which is properly vested in the legislative branch. This operates to increase the power of the judiciary. Although the court always has the authority to construe legislation, the implication doctrine involves a "significant additional step" by allowing the creation of a cause of action. Similarly, Justice Underwood in Kelsay stated that the judiciary must exercise caution in implying additional remedies because the judicial power "does not include amending specific legislation which we feel, however rightly, is lacking in some respect." Kelsay at 194, 23 Ill.Dec. at 569, 384 N.E.2d at 363 (Underwood, J., dissenting.)

In order to avoid invading the province of the legislature, the court must determine that its decision to imply a private cause of action is in accordance with legislative intent. The courts have attached different meanings to the "intent of the legislature." For example, Justice Powell in his dissent in Cannon takes a fairly restrictive view of legislative intent. He speaks of intent in the sense of legislative oversight when he states "(i)t defies reason to believe that in each of these statutes, Congress absent-mindedly forgot to mention an intended private action." (Cannon at 742, 99 S.Ct. at 1981, 60 L.Ed.2d at 603.) In Powell's view therefore, a private cause of action may only be implied when it can be said with some certainty that the legislature clearly intended one, but for some reason failed to include it in the statute. Other courts have taken a less restrictive view by maintaining that it is not necessary to show a specific intention to create a private cause of action. This view of legislative intent is best exemplified in Kelsay where the court implied a private cause of action for retaliatory discharge under the Workmen's Compensation Act after noting the ineffectiveness of the remedies provided under the Act. The Kelsay court concluded that the legislature could not possibly have intended that the wrongfully discharged employee be left without a remedy. (Kelsay at 182, 23 Ill.Dec. at 563, 384 N.E.2d at 357.) Probably the broadest interpretation of legislative intent was advanced by the court in Sherman v. Field Clinic (1979), 74 Ill.App.3d 21, 29 Ill.Dec. 597, 392 N.E.2d 154. When faced with the question of whether the legislature intended a private right of action, the court stated, "nothing in the Act indicates an intent to limit the remedies available to those, administrative or criminal, enumerated in the Act." (Sherman at 30, 29 Ill.Dec. at 606, 392 N.E.2d at 161.) This language appears to indicate that a private cause of action may be implied where the legislature does not expressly prohibit one.

The Illinois Supreme Court in Hoover v. May Department Stores Co. (1975), 77 Ill.2d 93, 32 Ill.Dec. 311, 395 N.E.2d 541 recently set forth the standard for determining legislative intent. There, the court refused to imply a private right of action under the Illinois Retail Installment Sales Act (Ill.Rev.Stat. 1973, ch. 1211/2, par. 501. et seq.) The court stated that "(t)he totality of the circumstances * * * compels the conclusion that the General Assembly did not intend that a private cause of action be maintained under the present Retail Installment Sales Act." Hoover at 104, 32 Ill.Dec. at 323, 395 N.E.2d at 546.

We believe that the totality of the circumstances in the cause before us militates against the conclusion that the General Assembly intended to create a private cause of action. It has been held that the legislature's purpose in enacting the Brokers Act was to prevent injury to the public by assuring that brokers and salesmen act fairly and honestly. (Ranquist v. Stackler (1977), 55 Ill.App.3d 545, 13 Ill.Dec. 171, 370 N.E.2d 1198, cert. den. 439 U.S. 926, 99 S.Ct. 309, 58 L.Ed.2d 318.) To accomplish this purpose, the Act classifies certain conduct as unlawful and provides that the Department of Registration and Education may revoke and suspend the license of a broker who engages...