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Thursday, June 19, 2014

Statutory Penalties under Withholding for Support Act Barred by Tort Immunity Act

Plaintiff sued the McHenry County Conservation District seeking compensatory damages of $1,086.90 and a statutory penalty of $407,700 under the Income Withholding for Support Act. She alleged that the District's payroll vendor failed to process child support payments for five paychecks of a District employee (her ex-husband).  

The District filed a motion to dismiss, arguing that the statutory penalty was barred by the Tort Immunity Act as a "punitive award."  The circuit court rejected that argument but capped the penalty award at $50,000 ($10,000 per violation).  The District appealed.  

The appellate court agreed with the District that the penalty was punitive in nature and, therefore, barred by Section 2-102 of the Tort Immunity Act that provides that "[n]otwithstanding any other provision of law, a public entity is not liable to pay punitive or exemplary damages in any action brought directly or indirectly against it by the injured party of a third party."  The court noted the purpose of the Tort Immunity Act to protect local public entities and employees from liability arising from the operation of government and to prevent public funds from being diverted from their intended purpose to the payment of damages claims.  Although the District was required to process the child support payments in accordance with the Withholding Act, it was immune from the statutory penalty provisions of that Act.  In re Marriage of Jessica A. Murray, 2014 IL App (2d) 121253 (June 11, 2014).

Full disclosure: Ancel Glink represented the McHenry County Conservation District in this case.


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