Morse v. Illinois Department of Professional Regulation

Case Date: 10/06/2000
Court: 4th District Appellate
Docket No: 4-00-0094 Rel

6 October 2000
NO. 4-00-0094

IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

HARVEY E. MORSE,
                    Plaintiff-Appellee,
                    v.
THE ILLINOIS DEPARTMENT OF PROFESSIONAL
REGULATION and LEONARD A. SHERMAN,
Director,
                    Defendants-Appellants.
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Appeal from
Circuit Court of
Sangamon County
No. 99MR198

Honorable
Thomas R. Appleton,
Judge Presiding.


PRESIDING JUSTICE COOK delivered the opinion of thecourt:

Defendants, the Illinois Department of ProfessionalRegulation and Leonard A. Sherman, Director (collectively referred to as Department), appeal from the circuit court's reversal of the Department's finding that Harvey Morse was unlawfullyworking as a private detective without a license. We affirm.

On March 23, 1998, the Department issued a cease anddesist order to Morse, finding that Morse "was operating as aprivate detective in Illinois by contacting individuals regardinglocating personal property for a fee." The Department's actionwas prompted by a September 24, 1996, letter that Morse, aFlorida resident, sent to an Illinois resident promoting his "International Genealogical Research" firm. Morse stated, "[w]ewish to inform you that we have been conducting research andinvestigation that indicate that you might be entitled to receivemoney or assets of which you are currently unaware." Morse'sfirm specializes in what is commonly referred to as "heir hunting," which typically involves locating persons who are entitledto recover unclaimed estate assets. Morse identifies unclaimedassets, uses genealogical research to trace the potential claimants, and then offers to assist the claimant in retrieving theassets for a 40% contingent fee.

We must determine if Morse's business activities aresubject to the Private Detective, Private Alarm, Private Security, and Locksmith Act of 1993 (Act) (225 ILCS 446/1 through 299(West 1998)). Section 5 of the Act defines "private detective"as:

"any person who by any means, including butnot limited to manual or electronic methods,engages in the business of, accepts employment to furnish, or agrees to make or makesinvestigations for fees or other valuableconsideration to obtain information withreference to:

* * *

(3) The location, disposition,or recovery of lost or stolen property." 225 ILCS 446/5 (West 1998).

In response to the cease and desist order, Morse filed a motionto vacate with the Department, arguing that he was not acting asa private detective; rather, he was engaging in genealogy, anexempt practice under the Act. Section 30(a) of the Act provides:

"(a) This Act does not apply to:

* * *

(9-5) A person, firm, or corporation engaged solely and exclusively in tracing and compilinglineage or ancestry." 225 ILCS446/30(a) (West 1998).

The Department responded to Morse's motion, arguingthat Morse was engaged in "[t]he location, disposition, orrecovery of lost or stolen property" for a fee (225 ILCS 446/5(West 1998) (subsection (3) of definition of "private detective")) and that his activities constituted acting as a privatedetective. Director Sherman denied Morse's motion to vacate, andMorse subsequently filed a complaint for administrative review inthe circuit court.

After reviewing the record and the parties' writtensubmissions, the circuit court found that Morse was "not in thebusiness of finding lost property" as referenced in the Act. However, the circuit court also noted that Morse was not engagedin "what is commonly understood as genealogical research" but was"employing techniques of both a private detective and a genealogist, [as] a tracer of unclaimed assets." Ultimately, thecircuit court held that, as a matter of law, Morse's activitieswere not governed by the Act. The circuit court reversed theDirector's decision and vacated the cease and desist order,finding that the Department could not use such a broad, sweepingapplication of the Act to regulate Morse's activities.

The Department appealed, asserting the same argumentsthat it did before the circuit court. The facts are undisputedin this case, and the parties agree that we are presented solelywith issues of law; thus, we will conduct a de novo review of thelimited record on appeal. Courts give substantial weight anddeference to the interpretation placed on a statute by the agencycharged with its administration and enforcement (Central CityEducation Ass'n v. Illinois Educational Labor Relations Board,149 Ill. 2d 496, 510, 599 N.E.2d 892, 898 (1992)) unless it iserroneous as a matter of law. However, we are not bound by theadministrative agency's interpretation of a statute. Boaden v.Department of Law Enforcement, 171 Ill. 2d 230, 239, 664 N.E.2d61, 66 (1996). Our decision hinges upon the interpretation ofsections 5 and 30(a)(9-5) of the Act. 225 ILCS 446/5, 30(a)(9-5)(West 1998).

I. LOST PROPERTY

The circuit court ruled that the assets Morse locatedwere not "lost property" but unclaimed assets, because "lost," asused in the Act, "presumes prior ownership and possession." TheDepartment argues that a person's entitlement to unclaimed estateassets qualifies as "lost property." "Lost property" has beendefined at common law as property that was unintentionallyseparated from the dominion and control of its owner. Kahr v.Markland, 187 Ill. App. 3d 603, 607-08, 543 N.E.2d 579, 582(1989); Hendle v. Stevens, 224 Ill. App. 3d 1046, 1056, 586N.E.2d 826, 833 (1992). Black's defines "lost property" as"[p]roperty that the owner no longer possesses because of accident, negligence, or carelessness, and that cannot be located byan ordinary, diligent search." Black's Law Dictionary 1233 (7thed. 1999).

We must apply these definitions, giving the statutorywords and phrases their plain, ordinary, and reasonable meaning. In re Marriage of Takata, 304 Ill. App. 3d 85, 94, 709 N.E.2d715, 722 (1999). Applying these definitions to the facts presented here, we cannot conclude that the unclaimed assets referred to in Morse's letter are those that fall within the plainand ordinary meaning of "lost property" referred to by thestatute. The assets at issue here were not "unintentionallyseparated from the control" of the heirs. Further, it wouldstrain reason to find that the heirs no longer possess the assets"because of accident, negligence, or carelessness." Utilizingheir hunting to access unclaimed estate assets is not synonymouswith the "location, disposition, or recovery of lost or stolenproperty." 225 ILCS 446/5 (West 1998).

II. GENEALOGY EXCEPTION

In 1998, the General Assembly amended the Act, providing a specific exemption for individuals who engage exclusivelyin tracing and compiling lineage and ancestry. 225 ILCS446/30(a)(9-5) (West 1998). Morse argues that he falls withinthis exception. In support of this claim, he emphasizes that hisletterhead plainly refers to his line of work as "InternationalGenealogical Research." Morse also argues that the body of theletter establishes that he is merely in the business of locating people (which is what genealogy is all about), not necessarily inthe business of locating property. Genealogy is defined as"[t]he summary history or table of a family, showing how thepersons there named are connected together." Black's Law Dictionary 682 (6th ed. 1990). Morse argues that his business isprecisely what the legislature had in mind when it enacted theexception provided in section 30(a)(9-5). We disagree.

Genealogical research does involve "detective" typeactivities necessary to trace a family's lineage. Morse, however, does more than simply create family trees. His incentiveis the financial payoff after tracing unclaimed assets to theproper heirs. We cannot conclude that the General Assemblyintended to specifically exempt "heir finding" through thisexception in the Act. Morse's activities do not fall squarelywithin the confines of the exception as he does more than "exclusively" engage in "tracing and compiling lineage or ancestry." 225 ILCS 446/30(a)(9-5) (West 1998). We agree with the circuitcourt that Morse's business falls somewhere between privatedetective work and exclusive genealogy.

As a final matter, we note that courts in severaljurisdictions and commentators have noted the problems of unregulated "heir hunting," including fraud, extortion, excessive fees,and unauthorized practice of law. See Twiss v. State of NewJersey, Department of Treasury, Office of Financial Management,124 N.J. 461, 473, 591 A.2d 913, 918-19 (1991) (noting practiceof the Treasurer not to disclose the amount due in abandonedaccounts was in reaction to the "deceptive and fraudulent practices of heir hunters in pursuing their business"); Nelson v.McGoldrick, 73 Wash. App. 763, 778, 871 P.2d 177, 184 (1994)(Alexander, J., dissenting) (heir hunters' pressuring clientswith the equivalent of criminal extortion and withholding information from another regarding a person's legal claims is extortion), rev'd, 127 Wash. 2d 124, 896 P.2d 1258 (1994); In reTaylor, 216 B.R. 515, 526 (E.D. Pa. 1998) (noting the "inherentunfairness involved in finders' method of solicitation of theirbusiness and fixing their fees"), appeal denied, 220 B.R. 854(E.D. Pa. 1998); Annotation, Heir Hunting, 171 A.L.R. 351 (1947)(noting cases of heir hunting and general attitude of distaste bycourts, citing cases from the 1930s).

The Department argues that the problems associated withthe unregulated practice of heir hunting, which include fraud,extortion, excessive fees, and the unauthorized practice of law,are precisely the type of "evil to be remedied" by the Act. 225ILCS 446/10 (West 1998). The Department encourages us to interpret the Act liberally to effectuate that purpose. While werecognize the Department's legitimate concerns regarding thebusiness of heir hunting, we cannot sanction such a broad andsweeping application of the Act. As the circuit court pointedout, this is an issue better reserved for the legislature, and wedecline to strain reason to find that Morse's activities areregulated by the existing statutes governing private detectives.

Affirmed.

GARMAN and KNECHT, JJ., concur.