Thursday, April 24, 2014

School Not Liable for Student's Death Caused by Dangerous Game

Parents of a middle school student sued the school district after their son collapsed and died after playing a game with other students called "body shots" where students take turns punching each other in the chest, abdomen, and ribs.  The parents claimed that the student's death was the result of wilful and wanton conduct on the part of the district.  

The court dismissed the case, and ruled in favor of the school district. Brooks v. McLean County District Unit 5 (April 18, 2014).  Although the court did find that the school district had a duty to supervise the students and was on notice that students had been injured playing this game in the past, the court did not find that the conduct of the school district rose to the level of wilful and wanton conduct.  As a result, the district was protected by the Tort Immunity Act, and the case was properly dismissed.

Wednesday, April 23, 2014

Village Liable under TIF Agreement with School District

In 1986, the Village of Gardner entered into an agreement with the Gardner-South School District.  The agreement granted the Village a license to use the District's outdoor recreational facilities located within a TIF district in exchange for the Village paying the District a set percentage of taxes received by the Village through the TIF.  

From 1986 to 2012, the Village paid the District over $4.5 million under the agreement.  In 2012, however, the Village withheld payment. The District sued to enforce the agreement, and the Village responded with two reasons for its non-payment: (1) the District was spending the money on employee salaries and benefits which was not allowed under the TIF Act and (2) the District's expenditures adversely affected the Village's reporting obligations under the TIF Act.  

The court rejected the Village's argument in Village of Gardner v. Gardner-South School District (April 17, 2014), and ruled in favor of the School District.  First, the court held that the agreement did not restrict the District's use of the money it received from the Village in any way. Second, the TIF Act expressly allows a municipality to enter into agreements to provide payments to other taxing districts like the license agreement between the Village and the District.  Finally, the TIF Act itself does not limit how a taxing district spends funds received through a license agreement with a municipality. 

Post Authored by Julie Tappendorf, Ancel Glink

Tuesday, April 22, 2014

PAC Issues 2nd Opinion of 2014

In an opinion that shouldn't surprise anyone (and not just because the PAC ruled against the public body), the PAC found a public body in violation of FOIA for denying a request for legal invoices. PAC Op. 14-002.  The News-Gazette had requested copies of payments to and invoices from a law firm that had provided legal services to the City of Urbana.  The City denied the request, asserting a number of exemptions, including that the information was protected as an attorney-client communication and that the records related to collective bargaining matters. 

The PAC reviewed the request, appeal, and the billing records and concluded that the City violated FOIA by denying the request in its entirety. The PAC first stated that the dates on which legal services were performed, the initials of the attorney performing the work, the number of hours billed, and the corresponding amount billed for each entry did not reveal any privileged attorney-client communication and was not, therefore, exempt under FOIA.  The PAC did, however, acknowledge that information contained in the billing descriptions or explanation of the work being performed could be exempt as an attorney-client communication under the Illinois appellate court reasoning in Ulrich v. Stukel, 294 Ill.App.3d 193 (1997), except for general descriptions that do not reveal any privileged information (i.e., holding a telephone conference, exchanging emails, or drafting and revising a memo).

This opinion is consistent with a previous opinion issued by the PAC in 2012 that interpreted (and some would argue extended) the Ulrich holding to require a public body to conduct a line-by-line analysis of their attorney invoices before releasing them in order to redact any privileged information and release the remainder.

Hopefully, we will see future PAC opinions that actually provide guidance on some of the unanswered questions about FOIA compliance, rather than continue to see "repeats" of the same analysis and decisions.

Post Authored by Julie Tappendorf, Ancel Glink

Court Filing Fee is Constitutional

On April 10, 2014, an Illinois appellate court upheld as constitutional an $8.00 filing fee imposed on all civil litigants in Peoria County.  Lipe v. Edward O’Connor

When the  plaintiff filed a small claims action in Peoria County, he was charged an $8.00 “neutral site custody exchange fee.”  He paid the fee under protest, and then filed a class action complaint challenging the fee’s constitutionality, arguing that the fee “unreasonably interfered with access to the courts and deprived him and other plaintiffs of property without due process.”  The trial court granted the county’s motion to dismiss the case, finding that the fee was constitutional.

On appeal, the plaintiff argued that the fee violated the free access clause of the Illinois Constitution of 1970, which provides that “every person shall find a certain remedy in the laws for all the injuries and wrongs” and “shall obtain justice by law, freely, completely, and promptly.”  The appellate court disagreed, and upheld the filing fee.  First, the filing fee was  imposed equally on all litigants.  Second, the fee was intended to support ancillary court services and compensate the county for services related to the operation and use of the neutral site custody exchange for family visitation.

When enacting a new fee, it is important for local governments to first analyze whether the fee bears a rational relationship to the purpose for imposition of the fee.  In this case, the court determined that a filing fee on all civil litigants was rationally related to the county’s need to finance the operation of the custody exchange program.

Post Authored by Tiffany Nelson-Jaworski, Ancel Glink

Monday, April 21, 2014

Bill Would Ban Confidentiality Provisions in Severance Agreements

The Illinois House recently passed HB 3664 that would amend the Freedom of Information Act to prohibit public bodies from including confidentiality provisions in severance agreements with public employees.  The bill is, in part, a response to the recent controversy surrounding the more than $700,000 severance package provided to outgoing Metra CEO.  The bill passed the House by a vote of 106-0 and is now awaiting a vote in the Senate.

The bill would amend Section 2.20 of FOIA, the settlement agreement provision, as follows (text that is underlined is proposed new language):
Sec. 2.20. Settlement and severance agreements 
(a) All settlement agreements entered into by or on behalf of a public body are public records subject to inspection and copying by the public, provided that information exempt from disclosure under Section 7 of this Act may be redacted. 
(b) A severance agreement that is funded in whole or part by public moneys or that releases a claim against a public body shall not require or impose any condition on any party to keep allegations, evidence, settlement amounts, or any other information confidential, except that which is necessary to protect a trade secret, proprietary information, or information otherwise exempt from disclosure under Section 7 of this Act. 
(c) The changes made by this amendatory Act of the 98th General Assembly do not apply to severance agreements signed before the effective date of this amendatory Act of the 98th General Assembly.
The bill would also amend FOIA to add a definition of "severance agreement, as follows:

(h) "Severance agreement" means a mutual agreement between any public body and its employee for the employee's resignation in exchange for payment by the public body.
The bill raises a few questions in my mind.

First, it is not entirely clear why the legislature included this language in the FOIA statute, since it really has nothing to do with the release of public records upon request and instead is a limit on a public body's power to contract with its employees.  

Second, although the new contractual limitation applies only to contracts entered into after the law becomes effective, there is still an open question as to the ability to enforce existing confidentiality provisions in severance and settlement agreements since the current language of section 2.20 makes these agreements public records subject to release. This issue comes up frequently when a FOIA request is submitted for an employment agreement that has confidentiality provision.  Many public bodies are left to wonder whether they should risk a FOIA lawsuit or a breach of contract lawsuit in deciding how to respond to one of these FOIA requests.  This bill doesn't answer that question, since it applies only to prospective agreements.   

Third, the bill seems to leave open the ability to still redact information in a severance agreement that would be exempt under Section 7 of FOIA. That would still leave public bodies with the ability to redact information that might fall under the "privacy" or other exemption listed in Section 7, but not those exemptions listed under Section 7.5 (including information protected by the Personnel Records Review Act, HIPAA and other statutory exemptions).  That is probably an oversight by the drafter of the bill , but could prove problematic in administering this law if it passes.

Post Authored by Julie Tappendorf, Ancel Glink

Friday, April 18, 2014

Banana Lady Loses Copyright Lawsuit

From Strategically Social comes this fun Friday case:  Banana Lady Loses Copyright Lawsuit

I wish this case had been decided before April 1st, because it sounds like a bad April Fools joke. 

The self-described "Banana Lady" (a singer and performer) was hired to perform a singing telegram at a credit union trade association event. After the event, she filed suit against the credit union association claiming they violated her intellectual property rights when employees and other audience members posted photos and videos of her performance on their personal Facebook pages. She claims that she made it clear to the arrangers of the event that audience members were not to take photos or videos and that they failed to inform the audience of these limitations until her performance had ended.

Judge Posner wasted no time in finding that the plaintiff's claims had no merit, and rejecting her argument that her version of the "banana dance" was copyright protected.  The rest of the court's opinion includes a summary of the plaintiff's many other lawsuits relating to her "Banana Lady" persona, including at least 8 federal lawsuits and 9 state lawsuits with similar allegations as the one before the 7th Circuit. The court concludes by suggesting that the district court consider enjoining the plaintiff from filing further lawsuits until she pays her litigation debts, which are well into six figures.

I wanted to post a photo of the Banana Lady [here] but restrained myself.  You can see a full-color photograph on page 2 of the 7th Circuit's opinion at Conrad v. AM Community Credit Union (7th Cir. April 14, 2014)

Thursday, April 17, 2014

Fee for Electronic Records Excessive Under FOIA

A couple of years ago, we reported on a 5th District Illinois Appellate Court case holding that a fee charged for production of real estate records violated Section 6 of the Illinois Freedom of Information Act (FOIA). Sage Information Services v. Humm. The Second District recently decided a similar issue, and citing Humm, found the Winnebago County Assessor in violation of FOIA for charging a requester $6,290.45 (five cents per parcel) to provide an electronic copy of the current real property assessment file for the entire county. Sage Information Services v. Suhr (2d Dist. April 14, 2014)

The Assessor had argued that it was expressly authorized under the Property Tax Code to charge a reasonable fee to provide assessment records.  The requester countered that FOIA "trumped" the Tax Code with respect to electronic records.  The appellate court agreed, holding that Section 6 of FOIA prohibits a fee for reproduction of electronic records in excess of the cost of the electronic medium.  In this case, the Assessor could only charge for the cost of the CD/DVD, nothing more.


Post Authored by Julie Tappendorf, Ancel Glink

Wednesday, April 16, 2014

Loitering is in the Air

As the weather grows warmer, municipalities can expect to see an age-old problem re-emerge - loitering. Concerns about crime, public order, and property rights have prompted municipalities throughout the country to pass ordinances taking action against loitering. Many of these ordinances, however, have not passed constitutional muster, as courts have found them to violate constitutional rights. An ordinance passed in Winter Park, Florida, met such a fate. 

The Winter Park City Council passed an ordinance in 2012 to address picketing targeted specifically against an individual residing in a single family home. The City noted that this targeted picketing had become an increasing problem. This ordinance allowed residents to post a “no loitering” sign on their property that prevented anyone from remaining in a “public area,” which included a park, sidewalk, street, or public right-of-way, within fifty feet of that residence. The ordinance also gave property owners the right to call the police to order people to leave the fifty foot zone around their property.

In Bell v. City of Winter Park, the 11th Circuit Court of Appeals found that this part of the ordinance violated the First Amendment. The court explained that citizens have a right to free speech in “traditional public fora,” public spaces like parks, streets, sidewalks, etc. While this speech can be regulated by content-neutral restrictions that pertain to the time, place, and manner that speech may occur, these laws must be applied equally to each person. Speech cannot be arbitrarily regulated for no articulated purpose. The court noted that the ordinance permitted private citizens to control the speech of other private citizens by calling the police to disperse anyone “loitering” on public property within fifty feet of their residence. No justification needed to be provided for this dispersal. In fact, the ordinance did not even define how long a person needed to remain in one place to be considered loitering. “Five minutes? One minute?” the court asked. “Citizens are left to wonder.” 

The court did uphold a second part of the ordinance that banned picketing or protesting within fifty feet of any residence, and made it illegal to picket or protest in any public space if this activity interfered with the rights of others to travel safely in these areas. The court found it served a significant government interest, the right of a property owner to be secure in his residence, and was narrowly tailored to achieve that interest. The court pointed to a Supreme Court decision that upheld an ordinance prohibiting picketing in front of someone’s residence because the government has a significant interest in “protecting the well-being, tranquility, and privacy of a home.” The government is allowed to prohibit picketing if it is not targeted at disseminating a message, but instead harasses and intrudes upon a particular individual’s rights. The ordinance must not discriminate against a particular viewpoint, and must leave open alternative channels of communication.  Here, picketers had alternative means to disseminate their message; they could do so standing fifty-one feet from a property. The ordinance did not favor a particular point-of-view, and it applied equally to everyone. Its primary purpose was to protect a resident from harassment, a significant interest worth protecting.  Therefore, at least that portion of the ordinance was constitutional.

Municipalities can take away a few lessons from Winter Park’s experience. First, while municipalities must tread lightly when passing anti-loitering ordinances, they can do so if they have a good reason for the ordinance. Ordinances seeking to uphold property rights and public order are purposes favored by courts. Second, anti-loitering ordinances must not be enforced arbitrarily. In Winter Park, the court took exception to the fact that private citizens could choose when to enforce the anti-loitering ordinance without providing any justification for doing so. Third, the terms of an anti-loitering ordinance must be clearly defined. The vague definition of “loitering” made Winter Park’s ordinance unconstitutionally broad. Any anti-loitering ordinance must define all potentially ambiguous terms. 

As the weather warms up and people return to the streets, municipalities need not fear loiterers. With clear goals and a well-drafted anti-loitering ordinance, a municipality can still keep control of its streets.

Post Authored by Matt DiCianni, Ancel Glink

Tuesday, April 15, 2014

Senior Facility Not Exempt From Property Taxes

A tax case on tax day - enjoy!

Certain charitable and religious uses are exempt from property taxes in Illinois.  A senior housing facility, Meridian Village Association, applied for a charitable and religious property tax exemption, but was denied an exemption by the Department of Revenue. On appeal, the appellate court first applied the "charitable use" exemption standards for senior housing, and agreed with the Department of Revenue that the senior housing facility did not qualify for an exemption. Although senior housing facilities have qualified for exemptions in the past, they must meet very specific standards, including that the charity benefits an unlimited number of people and that the charity is dispensed to all who need it.  Here, the Meridian Village Association's bylaws allowed it to deny care if necessary to operate in a financial manner.  It also only provided charitable care to its residents, not all in need.  The association also operated for-profit.  Meridian Village Assoc. v. Hamer (Mar. 28, 2014).

As to the senior facility's religious exemption claim, the court determined that the primary use of the facility was to care for the elderly, not as a religious institution.  

Post Authored by Julie Tappendorf, Ancel Glink

Monday, April 14, 2014

Procedural Errors Doom Administrative Adjudication Hearing

The Illinois Appellate Court recently invalidated a fine imposed by a City of Chicago administrative hearing officer regarding building code violations, because the process used by the City was, in the words of one judge, “a civil-procedure disaster.”  Stone Street Partners v. City of Chicago, 2014 IL App (1st) 123654 (March 31, 2014).  The opinion was authored by Justice Delort, a former municipal attorney, and is instructive for all attorneys involved in municipal administrative adjudication proceedings.

In 1999, a city inspector found several building code violations in plaintiff’s building. Plaintiff is a corporation. The city mailed a “notice of violation and summons” for an administrative hearing to the street address of the building.  The city code (and State law) requires that notice and summons be mailed to the registered agent of a corporation, but the city failed to do so.  The corporation had no knowledge of the code violations or the administrative hearing.  However, someone did receive the notice, because at the scheduled hearing a non-attorney friend of a managerial employee of the corporation (the employee was seriously ill), appeared and presented evidence to the hearing officer.  The hearing officer found the corporate owner liable for the code violations and fined it $1,050.  In 2004 the city “registered” the fine in court.  In 2009 the city filed a lien against the property for the amount of the fine and costs and in 2012 turned the original administrative fine into a “judgment” of the circuit court.  

In 2011, the corporation discovered the lien.  It attempted to get the original administrative fine vacated on the grounds that the city had failed to notify the registered agent of the corporation.  In the meantime, the city had destroyed most of the records of the original hearing, even though it was still attempting to collect the fine.  The hearing officer ruled that, for procedural reasons, the 1999 fine could not be vacated.  The corporation then filed suit in circuit court, raising several arguments.  The circuit court dismissed the complaint and the corporation appealed. 

The appellate court made a careful analysis of the sometimes obscure procedures involved in municipal administrative adjudication proceedings and ruled in favor of the corporation on two points which are key in all such proceedings.  First, the court held that because the city had failed to properly notify the owner of the building, service of process was invalid.  Service of process on a corporation must be made on the registered agent.  Second, the court held that a non-attorney may not represent a corporation in administrative adjudication proceedings.  Representation of a corporation in administrative proceedings constitutes the practice of law and must be made by a licensed attorney.  The appellate court allowed the corporation to nullify the original fine twelve years after it was imposed. 

While most administrative adjudications involve relatively small amounts of money, procedural rules must be followed in every case, or the process could be a waste of time. 

Post Authored by Paul Keller, Ancel Glink

Friday, April 11, 2014

The Wait is Over - PAC Issues 1st Opinion of 2014

As I reported on the blog previously, the PAC has been pretty quiet this year in issuing binding opinions - so quiet, in fact, that it had not issued one binding opinion until April 10th in PAC 14-001.  It will come as no surprise to loyal readers of this blog that the PAC ruled against the public body.

This particular opinion has some history at the PAC.  In 2013, a reporter filed a complaint with the PAC alleging that the Springfield Board of Education had violated the Open Meetings Act when it approved a separation agreement with the former superintendent.  The PAC issued binding opinion PAC 13-007 finding the School District in violation of the OMA because it signed the agreement in executive session.  

The Board appealed to the circuit court, and the court overturned the PAC, finding that the act of signing the agreement in closed session was not a violation of the OMA since the Board had formally acted on the agreement in open session.  The court then remanded back to the PAC the issue of whether the Board's actual vote on the separation agreement was preceded by an adequate "public recital."  You can read about the 2013 PAC ruling and court decision on the blog here.

The PAC reviewed a video recording of the following Board President's recitation of the item before it was voted on:
Item 9.1, approval of a resolution regarding the separation agreement. The Board President recommends that the Board of Education in Springfield School District No. 186 vote to approve the separation agreement and release between Dr. Walter Milton, Jr. and the Board of Education. Do I have a motion?
Although there was also some discussion about the separation agreement by individual Board members before the vote, and the agreement itself was posted on the District's website as part of the meeting agenda, the PAC still determined the Board violated the OMA because it did not publicly discuss or summarize the terms of the agreement, including the amount of the lump sum payment to the superintendent or the reasons leading to the decision to terminate the supervisor. 

The PAC based its decision on Section 2(e) of the OMA requiring a public body to (1) publicly recite the nature of its action; and (2) provide such other information as will inform the public of the business being conducted before taking final action.  In the PAC's opinion, the Board President's statement about the nature of the separation agreement, the individual Board members' discussions about the agreement, and releasing a copy of the agreement to the public in advance, were not an adequate "public recital" before the vote.  

As we noted previously, this interpretation of the OMA by the PAC is problematic for public bodies for a couple of reasons.  

First, the PAC has provided little to no guidance as to what constitutes a "public recital" under the OMA - must a public body publicly summarize each section of an agreement or ordinance before voting on it?  Read an entire document into the record before acting on it?  If providing a full copy of the document in advance is not enough to notify the public of the nature of an item that will be voted on, what will satisfy the PAC?  

Second, does this rule out the ability to use a consent or omnibus agenda to approve multiple agenda items?  

Third, what precedent is the PAC relying on for its interpretation of Section 2(e) of the OMA?  The only case cited in this opinion is directly contrary to the PAC's opinion, and involves a federal district court in Illinois holding that providing a copy of a resolution as part of a meeting agenda was a sufficient "public recital."  The PAC cites no case in support of its opinion that a detailed summary of an item is required before it can be voted on.

It is certainly possible that the School District may appeal this second PAC opinion to the court, particularly where the PAC cites no case law in support of its broad and unprecedented interpretation of "public recital." 

Post Authored by Julie Tappendorf, Ancel Glink 

Thursday, April 10, 2014

Bill Requires Governments to Post Officials' E-Mail Addresses

The Illinois Senate recently passed SB 3106, that would amend the Local Records Act to require all units of local government and school districts that maintain "Internet websites" (but excluding social media sites) to post electronic contact information (presumably e-mail addresses) for all elected and appointed officials on their websites.  The bill would preempt home-rule authority.

It's not clear how this particular piece of legislation has anything to do with the Local Records Act, which deals with the retention of government records, not the creation of new government records for communication purposes.  We will continue to monitor this bill and report back after the Illinois House takes action.

Post Authored by Julie Tappendorf, Ancel Glink