School Dist. No. 46, Kane, Cook, and DuPage Counties v. Del Bianco

• Decision Date: 14 March 1966
• Docket Number: No. 65--153,65--153
• Citation: 215 N.E.2d 25,68 Ill.App.2d 145
• Parties: SCHOOL DISTRICT NO. 46, KANE, COOK, AND DuPAGE COUNTIES, Illinois, a body politic and corporate, Appellee, v. A. J. DEL BIANCO, individually, Appellant, and A. J. Del Bianco, d/b/a A. J. Del Bianco and Associates, and Consumers Construction Company, a corporation, and United Pacific Insurance Company, a corporation, Defendants.
• Court: United States Appellate Court of Illinois

Page 25

215 N.E.2d 25

68 Ill.App.2d 145

SCHOOL DISTRICT NO. 46, KANE, COOK, AND DuPAGE COUNTIES, Illinois, a body politic and corporate, Appellee, v. A. J. DEL BIANCO, individually, Appellant, and A. J. Del Bianco, d/b/a A. J. Del Bianco and Associates, and Consumers Construction Company, a corporation, and

United Pacific Insurance Company, a

corporation, Defendants.

No. 65--153.

Appellate Court of Illinois, Second District.

March 14, 1966.

Leibman, Williams, Bennett, Baird & Minow, Chicago (David P. List and Stephen P. Thomas, Chicago, of counsel) and Gordon F. DeHart, Aurora, for appellant.

Carbary, Carbary & Chapski, Elgin, for appellee.

DAVIS, Justice.

This case involves the propriety of the order of the Circuit Court denying defendant's motion, pursuant to section 2 of the Uniform Arbitration Act (Ill.Rev.Stat.1963, Chap. 10, sec. 102), for an order on plaintiff and defendant to proceed to arbitration and to stay proceedings in said cause, and the appealability of such order.

Plaintiff, a School District, on March 1, 1962, entered into a standard form owner-architect agreement with defendant architect, whereby the defendant was to perform professional services in connection with the erection of the Streamwood Elementary School. The agreement outlined the basic services to be rendered by defendant; specified the extra services of the architect and the plaintiff's responsibilities; defined construction costs as well as the architect's expense; provided for payments to the architect and other routine matters; and provided for arbitration, as follows:

'Arbitration of all questions in dispute under this Agreement shall be at the choice of either party and shall be in accordance with the provisions, then obtaining of the Standard Form of Arbitration Procedure of The American Institute of Architects. This Agreement shall be specifically enforceable under the prevailing arbitration law and judgment upon the award rendered may be entered in the court of the forum, state or federal, having jurisdiction. The decisions of the arbitrators shall be a condition precedent to the right of any legal action.'

The Standard form of Arbitration Procedure of The American Institute of Architects, by agreement of the parties, established the procedure to govern any arbitration conducted pursuant to the agreement.

Plaintiff filed a three count complaint against the general contractor, the architect and the bonding company in connection with the construction of the Streamwood Elementary School. Count II, against the defendant architect, alleged the execution of the aforesaid agreement; performance by plaintiff; the duty of defendant to exercise the degree of skill and diligence contracted for in preparing plans, specifications and in superintending the construction of the building; his negligence in so doing to the extent that the building settled, causing cabinets, doorways and floors to become uneven and plumbing facilities to malfunction; that the school building has never been completed as a result of defendant's failure to exercise such reasonable skill and diligence; demanded of defendant that he rectify such defective and improper work; alleged his failure and refusal to make repairs or replacements; and stated that plaintiff would be obliged to employ labor and procure materials to complete said school under proper plans and specifications, to its damage in the sum of $150,000.

After service of summons, defendant filed the aforesaid motion to stay the proceedings and for an order directing the plaintiff and defendant to proceed to arbitration. This motion alleged the execution of the contract; the arbitration clause therein; that the defendant had request the plaintiff to submit to arbitration the disputes between them as alleged in Count II of the complaint; and that defendant had failed and refused to comply with defendant's request within a reasonable time.

The trial Court denied this motion, and defendant filed motion for its re-consideration and a motion for finding pursuant to section 50(2) of the Civil Practice Act (Ill.Rev.Stat.1963, Chap. 110, par. 50(2)), that there was no just reason for delaying an appeal from the order denying defendant's original motion. These motions were denied and this appeal followed. The trial Court properly denied defendant's motion for such finding, but under our view of this case, such ruling was without consequence.

Defendant urges that jurisdiction lies here in that this is an interlocutory appeal under Supreme Court Rule 31 (Ill.Rev.Stat.1963, Chap. 110, par. 101.31) from the order of the trial Court denying defendant's motion for a stay order; and that the trial Court should have ordered the plaintiff and defendant to arbitrate.

Plaintiff contends that the appeal is peacemeal, not authorized by Supreme Court Rule 31, and should be dismissed; and that the order denying the motion for arbitration was properly entered pursuant to sections 1 and 2 of the Uniform Arbitration Act (Ill.Rev.Stat.1963, Chap. 10, pars. 101 and 102).

The threshold consideration is the propriety of this appeal. It does not fall precisely within the interlocutory orders named as appealable in paragraph (1) of Supreme Court Rule 31. Defendant recognizes this circumstance, but argues that the motion for a stay was in effect a motion for an injunctional order, and that the order denying such stay constituted an appealable interlocutory order refusing an injunction under Supreme Court Rule 31(1).

This question was considered in Valente v. Maida, 24 Ill.App.2d 144, 164 N.E.2d 538 (1st Dist. 1960). At pages 149 and 150, 164 N.E.2d at page 541, the Court stated:

'Valente asserts that the order entered on October 23, 1959, in the first case is an injunctional order and appealable under Section 78 of the Civil Practice Act. The insurer says that the stay order is not an injunctional order and therefore not appealable. * * * In cases involving the interpretation of a statute providing for the reviewability of interlocutory injunctional orders the Supreme Court of the United States holds that a 'stay' order is synonymous with an injunctional order and therefore appealable. Enelow v. New York Life Insurance Co., 293 U.S. 379, 55 S.Ct. 310, 79 L.Ed. 440; Shanferoke Coal & Supply Corp. (of Delaware) v. Westchester Service Corp., 293 U.S. 449, 55 S.Ct. 313, 79 L.Ed. 583; Ettelson v. Metropolitan (Life) Insurance Co., 317 U.S. 188, 63 S.Ct. 163, 87 L.Ed. 176. The acceptance of insurer's argument would place a litigant who obtained a 'stay' in a better position than a litigant who obtained an 'injunction.' The courts will look to the substance rather than to the form. We are of the opinion that the 'stay' order entered in the first case is an injunctional order and appealable under Section 78 of the Civil Practice Act.'

Section 78 of the Civil Practice Act referred to in Valente was repealed, effective January 1, 1964, and Supreme Court Rule 31 was revised, effective on said date, to replace such repealed section.

In Shanferoke C. & S. Corp. of Delaware v. Westchester S. Corp., 293 U.S. 449, 55 S.Ct. 313, 79 L.Ed. 583 (1934), the Supreme Court had before it facts similar to the case at bar. At pages 451 and 452, 55 S.Ct. at page 314, Mr. Justice Brandeis pertinently stated:

'The order of the District Court denying the stay was not a final judgment appealable under section 128 of the Judicial Code, as amended (28 USCA § 225). Being an interlocutory order, it was appealable to the Circuit Court of Appeals under section 129, as amended (28 USCA § 227), only if the denial of the stay should be deemed the denial of an injunction. Compare General Electric Co. v. Marvel (Rare Metals) Co., 287 U.S. 430, 432, 53 S.Ct. 202, 77 L.Ed. 408. That question we must first determine * * *. For the reasons stated in Enelow v. New York Life Insurance Co., 293 U.S. 379, 55 S.Ct. 310, 79 L.Ed. 440, decided this day, an order granting or denying a stay based on an equitable defense or cross-bill interposed in an action at law under section 274b (28 USCA § 398) is appealable under section 129, as amended (28 USCA § 227). We are of the opinion that the special defense setting up the arbitration agreement is an equitable defense or cross-bill within the meaning of section 274b, and that the motion for a stay is an application for an interlocutory injunction based on the special defense.'

Likewise, we conclude that the order denying plaintiff's motion for stay was not a final order or judgment appealable to this Court under section 7 of Article VI of the Illinois Constitution, but rather it was an interlocutory order appealable to this Court under Supreme Court Rule 31 only if the denial of the stay should be deemed a denial of an injunction; and that the motion for stay was, in substance, an application for an interlocutory injunction based on the affirmative defense of arbitration.

The power to grant or refuse such stay appertains to equity in the enforcement of equitable principles, and amounts to granting or refusing injunctive relief. The use of injunctions to stay actions at law was almost coeval with the establishment of chancery jurisdiction. Pomeroy, in his work on Equity Jurisprudence, 3rd Edition, Volume III, section 1360, page 393, stated:

'It is no exaggeration to say that, during its formative period, the equitable jurisdiction was built up through the instrumentality of the injunction restraining the prosecution of legal actions, where the defendants sought the aid of chancery which alone could take cognizance of the equities that would defeat a recovery at law against them. This was not accomplished, however, without a long and severe opposition from the common law judges, which continued until the reign of James I. The jurisdiction then firmly established by judicial authority, has never since been questioned.'

In the case at bar, it matters not that the application for stay order was heard in the pending...