Find Laws Find Lawyers Free Legal Forms USA State Laws
Laws-info.com » Cases » Illinois » 4th District Appellate » 2002 » JMH Properties, Inc. v. Industrial Comm'n
JMH Properties, Inc. v. Industrial Comm'n
State: Illinois
Court: 4th District Appellate
Docket No: 4-01-0852WC Rel
Case Date: 07/09/2002

No. 4--01--0852WC


IN THE

APPELLATE COURT OF ILLINOIS

FIRST DISTRICT

INDUSTRIAL COMMISSION DIVISION


 

JMH PROPERTIES, INC., D/B/A ) Appeal from the Circuit Court
QUINCY BUILDING MATERIALS, ) of Adams County.
)
)
               Appellant, ) No. 00--MR--43
)
v. )
)
THE INDUSTRIAL COMMISSION )
et al.
) Honorable
) David K. Slocum,
(Russell D. May,  ) Judge, Presiding.
Appellee) )
 


 

JUSTICE O'MALLEY delivered the opinion of the court:

Plaintiff, Michael Haubrich, appeals from the order of thecircuit court affirming the order of the Industrial Commission(Commission). We reverse.

Claimant, Russell D. May, filed two applications foradjustment of claim following an incident in which he waselectrocuted while at work. On August 27, 1991, May filed a claimagainst JMH Properties, Inc., d/b/a Quincy Building Materials(JMH), and on September 23, 1991, he filed a claim againstHaubrich, the principal stockholder of JMH. Following a hearing,an arbitrator denied the claim against Haubrich and found JMHsolely liable for claimant's injury. On December 4, 1991, claimantwas awarded 18 weeks of temporary total disability totaling $4320and medical expenses of $102,700.86.

On June 8, 1992, May filed a two count complaint in thecircuit court. Count I alleged that JMH had failed to payaccording to the arbitrators decision and sought a judgment againstJMH for $102,700.86 plus additional medical bills. Count II wasbrought against Haubrich and his wife, Collette, and sought topierce the corporate veil of JMH and enter judgment against theHaubrichs, individually, for the $102,700.86. The Haubrichs movedfor dismissal of Count II, arguing that claimant was attempting tocircumvent the exclusive remedy provided by the Workers'Compensation Act (820 ILCS 305/1 et seq. (West 2000)) (Act) andthat the arbitrator's decision was res judicata as to the issue ofpersonal liability. On January 4, 1993, the trial court enteredjudgment against JMH on Count I but granted the Haubrich's motionto dismiss Count II with prejudice. May appealed the dismissal ofCount II, but the appellate court, on May's motion, dismissed theappeal on April 15, 1993.

May returned to the Commission and filed a new complaint underthe case number in which he had received his award, asking theCommission to pierce JMH's corporate veil and enter judgmentagainst the Haubrichs. An arbitrator granted JMH's motion todismiss, but, on review, the Commission vacated the decision andremanded the cause for further hearing. A different arbitratorconducted a hearing and found the Haubrichs personally liable forthe judgment against JMH. The Commission affirmed and adopted thearbitrator's decision, and the trial court affirmed theCommission's order. This appeal followed.

JMH contends that the arbitrator lacked jurisdiction toconsider the issue of piercing the corporate veil. We agree.

The Industrial Commission, as an administrative agency, has nogeneral or common law powers. Daniels v. Industrial Comm'n, No.90318, slip op. at 4 (March 21, 2002), pet. for rehearing pending. The only powers it possesses are those granted to it by thelegislature, and any action it takes must be specificallyauthorized by the legislature. Daniels, slip op. at 4. To theextent that an agency acts outside its statutory authority, it iswithout jurisdiction. Siddens v. Industrial Comm'n, 304 Ill. App.3d 506, 510 (1999). Piercing the corporate veil is an equitableremedy. Fiumetto v. Garrett Enterprises, Inc., 321 Ill. App. 3d946, 958 (2001).

We conclude that the Commission acted outside its statutoryauthority when it pierced JMH's corporate veil and imposedliability on the Haubrichs. The Act specifically provides for theaward of additional compensation and attorney fees when an employerdelays or fails to make payments pursuant to an award. See 820ILCS 305/16, 19(k), 19(l) (West 2000). However, the Act does notgrant the Commission the power to grant equitable relief, such asthe piercing of the corporate veil when an employer does not pay anaward, nor does the Act provide for individual liability against acorporation's officers and directors (see Webb v. Webb, 180 Ill.App. 3d 619, 622-23 (1989)) or its shareholders (see Jacobson v.Buffalo Rock Shooters Supply, 278 Ill. App. 3d 1084, 1090 (1996)). Any alteration in the Act so as to allow the piercing of thecorporate veil and reaching officers, directors, and shareholdersmust come from the legislature and not the courts. Jacobson, 278Ill. App. 3d at 1090.

Claimant brought two claims before the Commission and receivedfrom an arbitrator an award against JMH, not against the Haubrichs. Claimant did not appeal this decision. Claimant sought, andreceived, a judgment against JMH for the award in the trial court. He dropped his appeal of the trial court's dismissal of his attemptto obtain a judgment against the Haubrichs. When claimant soughtto pierce the corporate veil to enforce that judgment, his actionwas an attempt to enforce the judgment of the trial court, not theaward of the Commission. The proper forum for such a case was thetrial court, not the Commission. While our research disclosed nocase in which the Commission pierced the corporate veil, we foundnumerous cases in which attempts to pierce the corporate veil werebrought in the circuit court even though they sought enforcement ofworkers' compensation awards. See, e.g., Jacobson, 278 Ill. App.3d at 1087; Webb, 180 Ill. App. 3d at 620.

We note that the result we reach in this case is harsh,especially in light of the humane and remedial purposes of the Act;claimant is essentially denied the ability to recover his award. The harshness of the result, however, is due solely to the conductof claimant through his attorney. Had claimant maintained hisappeal before this court, or had claimant appealed the Commission'sinitial award, then the result reached here may not have come topass. Claimant, however, inexplicably abandoned those options. Wesay inexplicably because claimant's counsel was unable, at oralargument or in his brief, to justify this conduct.

In summary, claimant neglected to pursue the specific remediesthe Act provides for non-payment or tardy payment of awards. Itdoes not give the Commission the authority to enforce a circuitcourt's judgment by piercing the corporate veil. Therefore, theCommission lacked jurisdiction to grant that remedy, and we mustreverse the order of the Commission.

Reversed.

McCULLOUGH, P.J., and HOFFMAN, HOLDRIDGE and RARICK, JJ.,concur.

Illinois Law

Illinois State Laws
Illinois Tax
Illinois Court
Illinois Labor Laws
    > Minimum Wage in Illinois
Illinois Agencies
    > Illinois DMV

Comments

Tips