Find Legal Information

THIRD DIVIS ION

OCTOBER 28, 1998

No. 1-97-3372

JUSTICE DAVID CERDA delivered the opinion of the court:

The determinative issue on appeal is whether the nonresident defendants are subject to the jurisdiction of the Illinois courtseither under the doing-business doctrine (735 ILCS 5/2--209(b)(4) (West 1996)) or on the basis that the cause of action arosefrom the transaction of business in Illinois (735 ILCS 5/2--209(a)(1) (West 1996)).

Plaintiff, Sylvia M. Gaidar, as independent administrator of the estate of Mark S. Gaidar, also known as Mark S. Rose, deceased(decedent), appeals from the dismissal of her negligence complaint against defendants, Tippecanoe Distribution Service, Inc.,and David L. Steele, both Indiana residents, arising out of a collision in Indiana between decedent's car and a Tippecanoe truckdriven by Tippecanoe employee Steele, who had been driving the truck earlier that day in Illinois. We affirm the dismissal ofSteele as a defendant and reverse the dismissal of Tippecanoe as a defendant.

FACTS

Plaintiff filed a complaint on May 16, 1996, against defendants alleging that plaintiff was appointed as independentadministrator of the estate of Mark S. Gaidar in the circuit court of Will County, Illinois. The complaint did not allege whereplaintiff or decedent resided. Plaintiff further alleged that (1) Tippecanoe was a corporation that conducted business in CookCounty, Illinois; (2) on October 20, 1995, decedent was driving his car in Indiana, and David A. Steele negligently crashed histractor trailer truck into the rear of decedent's vehicle; (3) the truck was owned by Tippecanoe, and Steele was acting asTippecanoe's employee; and (4) decedent was treated at a Chicago hospital and died as a result of the accident. Plaintiff soughtcompensation for decedent's estate and next of kin.

Defendants filed a special and limited appearance and a motion seeking to quash service and dismiss the cause of action for lackof personal jurisdiction. Defendants filed in support of their motion the affidavit of Steele, who swore that he was a resident ofIndiana then and at the time of the occurrence and that, at the time of the accident in Indiana, he was driving for Tippecanoe. Defendants also filed the affidavit of Jeffery Baumgartner, the president and chief executive officer of Tippecanoe.

On March 14, 1997, plaintiff moved, in an initial response to the motion to dismiss, for leave to conduct limited discovery onthe issue of jurisdiction. The court granted the request.

Pursuant to the discovery order, the deposition of Baumgartner was taken on May 1, 1997, and defendants filed it in support oftheir motion to dismiss. He testified that he owned Tippecanoe, which was an interstate motor carrier that transported freight. Tippecanoe was incorporated in Indiana and had an office in Lafayette, Indiana; there were no other offices. Tippecanoe wasauthorized to handle general commodities in all 48 states and had authority to operate trucks in Illinois. The most dominantregion for Tippecanoe was the Midwest, including Illinois. Tippecanoe did not advertise for business, but Tippecanoe belongedto associations that had directories listing its name. Tippecanoe paid fuel tax only to Indiana, and Indiana sent some of the fueltax money to Illinois.

Baumgartner further testified that Steele took a trip to Northlake, Illinois, the day of the accident. Steele's log also stated he wasin South Holland, Bridgeview, and Beecher, Illinois, that day. Steele made a pickup and possibly made a delivery in Illinoisthat day. "From time to time," Tippecanoe made pickups and deliveries in Cicero, Franklin Park, Bedford Park, Alsip, andChicago, Illinois. "Once in a while," Tippecanoe made pickups and deliveries in McCook, Illinois. "Fewer than 30 times ayear," Tippecanoe went to a company in Alsip, Illinois. Northwestern Salt Company located in the Chicago area also gaveTippecanoe a lot of shipments. Tippecanoe usually delivered loads to the railroad yards and had interchange agreements withthree railroads. Tippecanoe would typically pick up loads at the Santa Fe yard or at one of the Chicago & Northwestern yards inthe Chicago area. Tippecanoe did not have any "big customers" in Illinois; Tippecanoe had "irregular customers" in Illinois.

Baumgartner further testified that he estimated that, in a typical month in the last three or four years, less than 2% of shipmentsoriginating or terminating were for customers in Illinois. The estimate was based on the company's mileage statistics. Less than10% of the total miles were driven in Illinois; his calculation was based on the mileage that was reported for fuel tax andlicensing purposes. (A document prepared for Indiana listed mileage of 195,427 for Illinois for the period from July 1, 1995,through June 30, 1996, and the total miles for that period was noted as being 1,910,454.) Tippecanoe's average revenue per milewas $1.32, but Baumgartner could not estimate the percentage of gross revenues from Illinois trips.

On July 2, 1997, plaintiff filed a motion to strike the affidavit of Baumgartner for failure to meet the requirements of SupremeCourt Rule 191. 145 Ill. 2d R. 191. Plaintiff's motion challenged these statements in Baumgartner's affidavit:

"4. Though Tippecanoe's drivers do utilize roadways within Illinois, less than 10% of the total miles driven on behalf of thecompany were driven in Illinois. This includes trips where the driver is just passing through Illinois on the way to hisdestination. Less than 2% of all trips made by Tippecanoe drivers originate or terminate in Illinois."

Also on July 2, 1997, plaintiff filed a response to the motion to dismiss. Among the documents filed by plaintiff in support wasthe affidavit of Randolph Greune, an attorney who had attended Baumgartner's deposition. He swore that in May 1997 heobserved a map of Cook County in the reception area at the Tippecanoe office and that the map circled in black towns in Illinoiscommonly associated with transportation, including Cicero, Franklin Park, Melrose Park, Forest Park, McCook, Bedford Park,Alsip, and two areas in Chicago.

On August 6, 1997, the trial court denied the motion to strike, finding that Baumgartner's deposition "contained facts addressedin affidavit." On that date, the trial court also granted the motion of defendants to quash service and dismissed the case withprejudice for lack of jurisdiction. The trial court found in part that Tippecanoe's business contacts in Illinois were onlyoccasional and irregular.

Plaintiff appealed on September 5, 1997.

DISCUSSION

I. Motion to Dismiss Appeal

Defendants have moved to dismiss the appeal as moot because plaintiff previously filed an action that is pending in Indiana andthat also alleges the same conduct of defendants. We deny the motion to dismiss because defendants have cited no authority tosupport their argument. 155 Ill. 2d R. 341(e)(7); City of Mattoon v. Mentzer, 282 Ill. App. 3d 628, 632, 668 N.E.2d 601 (1996).

II. Standard of Review

The parties disagree over what is the appropriate standard of review from a dismissal based on lack of personal jurisdiction. Thecases are conflicting. Some cases state that the standard of review is whether the findings of the court were against the manifestweight of the evidence. E.g., W.R. Grace & Co. v. CSR Ltd., 279 Ill. App. 3d 1043, 1046, 666 N.E.2d 8 (1996); Dilling v.Sergio, 263 Ill. App. 3d 191, 195, 635 N.E.2d 590 (1994); Pilipauskas v. Yakel, 258 Ill. App. 3d 47, 54, 629 N.E.2d 733 (1994);Rokeby-Johnson v. Derek Bryant Insurance Brokers, Ltd., 230 Ill. App. 3d 308, 318, 594 N.E.2d 1190 (1992); Finnegan v. LesPourvoiries Fortier, Inc., 205 Ill. App. 3d 17, 25, 562 N.E.2d 989 (1990). Other cases state that the standard of review is denovo where no evidentiary hearing was held. E.g., Cameron v. Owens-Corning Fiberglas Corp., 296 Ill. App. 3d 978, 983-84,695 N.E.2d 572 (1998); Stein v. Rio Parismina Lodge, 296 Ill. App. 3d 520, 523, 695 N.E.2d 518 (1998); International BusinessMachines Corp. v. Martin Property & Casualty Insurance Agency, Inc., 281 Ill. App. 3d 854, 858, 666 N.E.2d 866 (1996)(IBM).

We agree with the analysis in Stein, 296 Ill. App. 3d at 523, that the standard of review of against the manifest weight of theevidence would apply if the trial court heard courtroom testimony on jurisdictional issues but that a de novo standard of reviewapplies when the trial court heard no testimony and determined jurisdiction solely on the basis of documentary evidence. Wenote our agreement with the recent case TCA International, Inc. v. B & B Custom Auto, Inc., No. 1--98--0252 (September 22,1998), slip op. at 9-21, which also determined that the standard of review depends on whether the trial court determined issuesof fact.

In our case, there were neither conflicts in the evidence to resolve by the trial court nor any credibility determinations to make;only a question of law was presented to the trial court and is presented to this court. No evidentiary hearing was held. Therefore, our review of the jurisdiction issue is de novo.

III. Burden of Proof

The parties also disagree over what was plaintiff's burden of proof. Plaintiff argues that her only burden of proof was to show aprima facie case of personal jurisdiction.

Some cases hold that plaintiff's burden is to show only a prima facie case of personal jurisdiction. E.g., D.S. America (East),Inc. v. Elmendorft Grafica, Inc., 274 Ill. App. 3d 643, 649, 654 N.E.2d 472 (1995); Alpert v. Bertsch, 235 Ill. App. 3d 452, 459,601 N.E.2d 1031 (1992); see also Stein, 296 Ill. App. 3d at 523 (also finds that the prima facie burden does not apply ifcourtroom testimony is heard, in which case the plaintiff's burden is the preponderance of the evidence).

It has also been held that the burden of proof to establish jurisdiction, where it is challenged, is by a preponderance of theevidence. Finnegan, 205 Ill. App. 3d at 25; People ex rel. Hartigan v. Kennedy, 215 Ill. App. 3d 880, 890, 576 N.E.2d 107(1991). Finnegan noted that only federal precedent was cited by the seminal decision Kutner v. DeMassa, 96 Ill. App. 3d 243,247-48, 421 N.E.2d 231 (1981), in a long line of cases requiring the party asserting jurisdiction to state only a prima facie casein order to prevail. Finnegan, 205 Ill. App. 3d at 24-25. Finnegan agreed with a treatise's analysis that the federal cases citedby Kutner were not applicable because, in federal court, lack of personal jurisdiction is resolved at trial--if the plaintiff candefeat a motion to dismiss by proving a prima facie case. Finnegan, 205 Ill. App. 3d at 25, citing 3 R. Michael, Illinois Practice