Downtown Disposal Services, Inc. v. The City of Chicago , 2012 IL 112040 ( 2012 )

ILLINOIS OFFICIAL REPORTS
Supreme Court
Downtown Disposal Services, Inc. v. City of Chicago, 2012 IL 112040Caption in Supreme DOWNTOWN DISPOSAL SERVICES, INC., Appellee, v. THE CITY
Court: OF CHICAGO et al., Appellants.
Docket No. 112040
Filed November 1, 2012
Held The “nullity rule” calling for dismissal of a complaint filed on behalf of
(Note: This syllabus a corporation by a nonattorney should not be applied automatically, but
constitutes no part of on the basis of a consideration of all the facts and
the opinion of the court circumstances—dismissal of complaint for administrative review
but has been prepared properly reversed and cause remanded for an opportunity to retain
by the Reporter of counsel and amend the complaint if the facts so warrant.
Decisions for the
convenience of the
reader.)
Decision Under Appeal from the Appellate Court for the First District; heard in that court
Review on appeal from the Circuit Court of Cook County, the Hon. James M.
McGing, Judge, presiding.
Judgment Appellate court judgment affirmed.
Counsel on Mara S. Georges and Stephen R. Patton, Corporation Counsel, of
Appeal Chicago (Benna Ruth Solomon, Myriam Zreczny Kasper and Christopher
S. Norborg, of counsel), for appellants.
Richard D. Boonstra and John C. Lillig, of Hoogendoorn & Talbot LLP,
and Patrick E. Dwyer III, all of Chicago, for appellee.
John G. Locallo, Charles J. Northrup and Melinda J. Bentley, of
Springfield, for amicus curiae Illinois State Bar Association.
Justices JUSTICE BURKE delivered the judgment of the court, with opinion.
Justices Freeman, Garman, and Theis concurred in the judgment and
opinion.
Justice Karmeier dissented, with opinion, joined by Chief Justice Kilbride
and Justice Thomas.
OPINION
¶1 In this case, we must determine whether a complaint for administrative review filed by
a corporation’s president, on behalf of the corporation, is a nullity because the president is
not an attorney. For the reasons that follow, we conclude that the complaints are not void.
¶2 BACKGROUND
¶3 Between December 2007 and March 2008, the City of Chicago’s department of
transportation issued plaintiff, Downtown Disposal Services, Inc., four notices for violating
City ordinances pertaining to several of its dumpsters. The notices required Downtown
Disposal to appear at administrative hearings on various dates between February and April
2008. When Downtown Disposal failed to appear at any of the hearings, the department of
administrative hearings entered default judgments against Downtown Disposal requiring it
to pay costs and penalties.
¶4 On August 18, 2008, Peter Van Tholen, president of Downtown Disposal, filed four
motions to set aside the default judgments, alleging the company did not receive notice of
the hearings. On September 19, 2008, at a consolidated hearing, Van Tholen advised the
administrative law officer that for the previous five years, Downtown Disposal had made
several attempts to change its address on file with the City, but the City had not made the
change in its records. Because of the City’s failure, Downtown Disposal did not receive the
violation notices. Following Van Tholen’s testimony, the administrative law officer denied
Downtown Disposal’s motions, finding that the City sent the notices to the address on file
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for Downtown Disposal and that Downtown Disposal failed to provide any evidence it had
changed its address before the violations were mailed. Thereafter, the following colloquy
occurred:
“Administrative Law Officer Harris: However, you do have a right to appeal the
decision—
Mr. Van Tholen: I will.
Administrative Law Officer Harris: —to the Circuit Court.
That’s fine, sir. You have a right to appeal the decision to the Circuit Court
within 35 days of today’s date, and you would do that in Room 602 of the Daley
Center.”
¶5 On October 16, 2008, Van Tholen filled out four blank pro se complaints for
administrative review. On the preprinted form supplied by the clerk’s office, Van Tholen
filled in plaintiff’s name, its address, the date of the administrative decision, and the docket
number. Van Tholen signed the forms. Service was then made upon the City by certified
mail. On April 19, 2009, attorney Richard D. Boonstra filed appearances on behalf of
plaintiff in each of the cases.
¶6 On July 29, 2009, the City moved to dismiss the complaints pursuant to section 2-
619(a)(9) of the Code of Civil Procedure (735 ILCS 5/2-619(a)(9) (West 2008)), arguing that
because a nonattorney, Van Tholen, filed the complaints on behalf of Downtown Disposal,
a corporation, they were null and void. On September 23, Boonstra filed motions for leave
to file amended complaints, arguing that the lack of an attorney’s signature was a technical
defect which could be cured by filing an amended complaint signed by an attorney. In
addition, in January of 2010, Downtown Disposal filed a motion for summary judgment,
arguing that because the City was a municipal corporation, the violations had to be signed
by an attorney and, since they were not, the underlying actions filed by the City were null and
void ab initio.
¶7 Following a hearing on January 29, 2010, the circuit court of Cook County granted the
City’s motions to dismiss, finding it was compelled to follow authority from the First District
of the appellate court holding that actions filed by nonattorneys on behalf of a corporation
are null and void. Based on this ruling, the court declared Downtown Disposal’s motions for
leave to amend the complaints and motion for summary judgment moot.
¶8 In ruling on the question before it, the trial court found “this is a troubling issue” because,
in administrative review cases, the trial courts are “confronted with nonattorneys filing
pleadings” on a daily basis. After pointing out that the appellate court had held that filling
in a form was the unauthorized practice of law, the trial court stated as follows:
“If you review the Complaint that’s filed in the Administrative Review cases, it
is just that. It is a prepared form. It is handed to anyone who walks into the Clerk’s
office. They merely have to fill in names and fill in the date that the Findings and
Decision was entered against them, and it has form language as to why they are
appealing the matter and it initiates this process.”
After again stating it was compelled to follow the decisions of the appellate court, the trial
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judge identified certain issues he believed should be revisited. Specifically:
“The actual issue in this case as to the filing of this form, is it the unauthorized
practice of law?
And then there is [sic] other considerations, such as here where the refiling of an
action is not available to the party that it would be time barred by dismissal of the
pending action, is that too severe a sanction to impose?
Coupled with the clearly erroneous legal instructions which are being given by
the administrative law officers at the City of Chicago Department of Administrative
Hearings, where they inform nonattorneys who appear before them representing
corporations that you, quotation marks, ‘You have the right to appeal this,’ and they
direct these people to the 6th Floor of Daley Center to file an appeal in these
matters.”
The trial court further questioned whether a nonattorney representing a corporate entity
before the administrative hearings in the City might not also be engaged in the unauthorized
practice of law. Plaintiff appealed.
¶9 The appellate court reversed and remanded. 407 Ill. App. 3d 822. The court noted that
“appellate court decisions have differed in their adherence to the automatic application of the
nullity rule,” and held that, in the case at bar, the purposes underlying the nullity rule,
protection of litigants and the public as well as the integrity of the court system, would not
be furthered by its application. Accordingly, the appellate court reversed the trial court’s
decision and remanded for further proceedings.
¶ 10 We granted the City’s petition for leave to appeal (Ill. S. Ct. R. 315 (eff. Feb. 26, 2010)),
and allowed the Illinois State Bar Association to file an amicus brief on behalf of the City.
¶ 11 ANALYSIS
¶ 12 Unauthorized Practice of Law
¶ 13 We must first determine whether Van Tholen engaged in the unauthorized practice of law
when he filed the complaints for administrative review on behalf of plaintiff corporation.
¶ 14 This court has the inherent power to define and regulate the practice of law in this state.
Ford Motor Credit Co. v. Sperry, 214 Ill. 2d 371, 382 (2005). Our rules are intended to
safeguard the public from individuals unqualified to practice law and to ensure the integrity
of our legal system. Sperry, 214 Ill. 2d at 383. See also Herman v. Prudence Mutual Casualty
Co., 41 Ill. 2d 468, 479 (1969) (citing Chicago Bar Ass’n v. Quinlan & Tyson, Inc., 34 Ill.
2d 116 (1966)); City of Chicago v. Witvoet, 12 Ill. App. 3d 654, 655-56 (1973) (requirements
for practicing law are imposed for the “protection of litigants against the mistakes of the
ignorant and the schemes of the unscrupulous and the protection of the court itself in the
administration of its proceedings from those lacking the requisite skills”).
¶ 15 There is no mechanistic formula to define what is and what is not the practice of law. In
re Discipio, 163 Ill. 2d 515, 523 (1994); People ex rel. Chicago Bar Ass’n v. Barasch, 406
Ill. 253, 256 (1950). Rather, we examine the character of the acts themselves to determine
if the conduct is the practice of law (Quinlan & Tyson, Inc., 34 Ill. 2d at 120) and each case
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is largely controlled by its own peculiar facts (People ex rel. Chicago Bar Ass’n v. Tinkoff,
399 Ill. 282, 289 (1948)).
¶ 16 Plaintiff contends that there was no unauthorized practice of law because Van Tholen
merely filled in blanks on a simple form that did not require the use of any legal expertise.
We disagree. It is not the simplicity of the form that is important but the fact that an appeal
was pursued on behalf of a corporation by a nonattorney.
¶ 17 A corporation must be represented by counsel in legal proceedings. See Nixon, Ellison
& Co. v. Southwestern Insurance Co., 47 Ill. 444, 446 (1868) (as early as Lord Coke’s time,
corporations could not appear in person but had to appear by an attorney). See also Nispel
v. Western Union R.R. Co., 64 Ill. 311 (1872). This rule arises from the fact a corporation is
an artificial entity that must always act through agents and there may be questions as to
whether a particular person is an appropriate representative. For example, while an officer
of a corporation, i.e., an individual such as Van Tholen, may believe review of an
administrative decision is in the best interests of a company, it may, in fact, not be. The
interests of the corporate officers and that of the corporation, a distinct legal entity, are
separate. See, e.g., Upjohn Co. v. United States, 449 U.S. 383, 390-92 (1981) (rejecting
proposition that senior managers and corporation have identical interests). It is not every case
where the views or interests of a principal and the corporation mesh. By requiring an attorney
to represent a corporation in legal proceedings, this problem is mitigated.
¶ 18 A complaint for administrative review is essential to preserve one’s right to appeal an
administrative decision and invokes the appellate review mechanism. The filing of the
complaint affects the substantial legal rights of the party seeking administrative review, in
this case, Downtown Disposal. As such, only an individual representing the corporation itself
can ascertain whether it is best for a corporation to pursue review of an administrative
decision and invoke the appellate mechanism.
¶ 19 Accordingly, when Van Tholen filed the complaints for administrative review, he
engaged in the unauthorized practice of law. He was not an attorney representing the interests
of the corporation and could not file for administrative review on behalf of Downtown
Disposal.
¶ 20 Having reached this conclusion, we must now determine the consequences of Van
Tholen’s conduct and decide whether the complaints for administrative review were a nullity.
¶ 21 Nullity Rule
¶ 22 Courts in this country, including this court, unanimously agree that a corporation must
be represented by counsel in legal proceedings. However, courts disagree on the
consequences the lack of representation has on actions taken by nonlawyers on behalf of a
corporation. Some courts, including our appellate court, have held that such actions are a
nullity and warrant dismissal, the entry of a default judgment against the corporation, or
vacatur of any judgment rendered. The defect is deemed incurable and goes to the court’s
power to exercise subject matter jurisdiction. See Siakpere v. City of Chicago, 374 Ill. App.
3d 1079, 1081 (2007) (complaint for administrative review filed by corporate officer on
behalf of corporation a nullity); Midwest Home Savings & Loan Ass’n v. Ridgewood, Inc.,
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123 Ill. App. 3d 1001 (1984) (notice of appeal filed on behalf of corporation by person not
entitled to practice law held to be a nullity); Housing Authority v. Tonsul, 115 Ill. App. 3d
739 (1983) (judgment void even if layperson merely signs complaint and all other
appearances are by attorney). See also Land Management, Inc. v. Department of
Environmental Protection, 368 A.2d 602 (Me. 1977); Massongill v. McDevitt, 1989 OK CIV
APP 82, 828 P.2d 438 (1989); Tracy-Burke Associates v. Department of Employment
Security, 699 P.2d 687 (Utah 1985); Jadair Inc. v. United States Fire Insurance Co., 562
N.W.2d 401 (Wis. 1997).
¶ 23 Other jurisdictions take the approach that actions by nonattorneys on behalf of a
corporation are curable defects, allowing the corporation a reasonable time to obtain counsel
and make any necessary amendments. These courts liberally construe the rules of civil
procedure and emphasize substance over form to advance the policy favoring resolution of
cases on the merits. See, e.g., United States v. High Country Broadcasting Co., 3 F.3d 1244(9th Cir. 1993); Jones v. Niagara Frontier Transportation Authority, 722 F.2d 20, 23 (2d
Cir. 1983); Southwest Express Co. v. Interstate Commerce Comm’n, 670 F.2d 53 (5th Cir.
1982); Strong Delivery Ministry Ass’n v. Board of Appeals, 543 F.2d 32 (7th Cir. 1976);
United States v. 9.19 Acres of Land, More or Less, Situate in Marquette County, Michigan,
416 F.2d 1244 (6th Cir. 1969); Flora Construction Co. v. Fireman’s Fund Insurance Co.,
307 F.2d 413 (10th Cir. 1962); Operating Engineers Local 139 Health Benefit Fund v.
Rawson Plumbing, Inc., 130 F. Supp. 2d 1022 (E.D. Wis. 2001); A-OK Construction Co. v.
Castle Construction Co., 594 So. 2d 53 (Ala. 1992); Boydston v. Strole Development Co.,
969 P.2d 653, 656 (Ariz. 1998) (en banc); Rogers v. Sonoma County Municipal Court, 243
Cal. Rptr. 530, 530-33 (Cal. Ct. App. 1988); BQP Industries, Inc. v. State Board of
Equalization, 694 P.2d 337, 341-42 (Colo. App. 1984); Torry v. Leesburg Regional Medical
Center, 769 So. 2d 1040, 1045-46 (Fla. 2000); Rainier Holdings, Inc. v. Tatum, 622 S.E.2d
86 (Ga. Ct. App. 2005); Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590
P.2d 570 (Haw. 1979); Hawkeye Bank & Trust, National Ass’n v. Baugh, 463 N.W.2d 22,
26 (Iowa 1990); First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d
325 (Md. Ct. Spec. App. 2002); Waite v. Carpenter, 496 N.W.2d 1 (Neb. Ct. App. 1992);
KSNG Architects, Inc. v. Beasley, 109 S.W.3d 894 (Tex. Ct. App. 2003); Graham v. David
County Solid Waste Management & Energy Recovery Special Service District, 1999 UT App
136, ¶¶ 15-16, 979 P.2d 363; Starrett v. Shepard, 606 P.2d 1247, 1253-54 (Wyo. 1980).
¶ 24 This court has recently discussed the nullity rule on two occasions wherein we declined
to apply it. See Applebaum v. Rush University Medical Center, 231 Ill. 2d 429 (2008); Ford
Motor Co. v. Sperry, 214 Ill. 2d 371 (2005). However, as the City maintains, these two cases
are distinguishable. Neither involved a nonattorney representing a corporation in a legal
proceeding. The City urges us to follow the line of authority holding that any unauthorized
practice of law by a nonattorney is a nullity. We decline to do so.
¶ 25 A recent decision of the Seventh Circuit, In re IFC Credit Corp., 663 F.3d 315 (7th Cir.
2011), authored by Judge Posner, provides insight. The question before the court was
whether a corporate bankruptcy petition, signed only by the president of the company who
was not an attorney, rendered the proceedings void or, in state court terms, a nullity. In re
IFC Credit Corp., 663 F.3d at 317. If so, the court lacked jurisdiction over the matter and the
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error could not be cured by amending the petition, signed by an attorney, even one day after
the original petition had been filed. The Seventh Circuit held that the proceedings were not
void.
¶ 26 First, the court concluded that the rule prohibiting corporations from litigating without
counsel could not be deemed a rule of subject-matter jurisdiction. In re IFC Credit Corp.,
663 F.3d at 319. In so finding, the court noted that the United States Supreme Court has
“taken a sharp turn toward confining dismissals for want of subject-matter jurisdiction to
cases in which the federal tribunal has been denied by the Constitution or Congress or a valid
federal regulation the authority to adjudicate a particular type of suit.” In re IFC Credit
Corp., 663 F.3d at 319. The court stated that “[t]he primary distinction is thus between
classes of case that the Constitution or legislation declares off limits to the federal courts and
errors in the conduct of cases that are within limits.” In re IFC Credit Corp., 663 F.3d at 320.
The court reasoned that bankruptcy proceedings are “the type[s] of proceeding[s] that
Congress has authorized federal courts to handle, while the rule barring lay representation
of a corporation concerns the conduct of cases that are within that authority.” In re IFC
Credit Corp., 663 F.3d at 320.
¶ 27 The court then further found that the consequences which result from a finding that the
court lacks jurisdiction can be severe. In some cases, the statute of limitations may have run,
thus depriving the corporation of access to the courts. Where the statute of limitations has
not run, requiring a “do over” is costly, particularly if the lack of representation is discovered
late in a protracted litigation. The court concluded that these consequences “are not
appropriate punishments for pro se litigation by a corporation.” In re IFC Credit Corp., 663
F.3d at 320. Finally, the court posited there was “no danger that litigation by unrepresented
corporations will flourish” because judges dislike pro se litigation and “will be vigorous
enforcers of the rule that bars it, except in cases like this where the violation was utterly
inconsequential.” In re IFC Credit Corp., 663 F.3d at 321.
¶ 28 The court reasoned that the rule against nonattorneys representing corporations “should
be enforced, but sanctions for its violation should be proportioned to the gravity of the
violation’s consequences.” In re IFC Credit Corp., 663 F.3d at 321. In In re IFC Credit
Corp., there were no adverse consequences by the filing error. As such, there was no reason
to impose any sanction, let alone dismissal. In re IFC Credit Corp., 663 F.3d at 321.
¶ 29 We find the reasoning of In re IFC Credit Corp. sound. This court’s definition of subject
matter jurisdiction is similar to that of the supreme court precedent. See In re Luis R., 239
Ill. 2d 295, 300 (2010) (“This court defines ‘subject matter jurisdiction’ as a court’s power
‘ “to hear and determine cases of the general class to which the proceeding in question
belongs.” ’ [Citation.]”); Wood v. First National Bank of Woodlawn, 383 Ill. 515, 522
(1943) (“Jurisdiction of the subject matter is the power to adjudge concerning the general
question involved, and if a complaint states a case belonging to a general class over which
the authority of the court extends, the jurisdiction attaches and no error committed by the
court can render the judgment void.”). In this case, as in In re IFC Credit Corp., our
constitution has authorized the legislature to provide the circuit court with the power to
review administrative proceedings. Thus, in this case, as in In re IFC Credit Corp., the rule
prohibiting lay representation concerns the conduct of cases and the orderly administration
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of justice, not subject matter jurisdiction.
¶ 30 Further, we agree with the Seventh Circuit that a per se nullity rule is unreasonable and
that sanctions for violating the rule against the unauthorized practice of law “should be
proportioned to the gravity of the violation’s consequences.” As we reasoned in Applebaum,
because the consequences of applying the nullity rule to a case can be harsh, it should be
invoked only where it fulfills the purposes of protecting both the public and the integrity of
the court system from the actions of the unlicensed, and where no other alternative remedy
is possible. Applebaum, 231 Ill. 2d at 439 (citing Sperry, 214 Ill. 2d at 382).
¶ 31 We hold there is no automatic nullity rule. Instead, the circuit court should consider the
circumstances of the case and the facts before it in determining whether dismissal is proper.
The circuit court should consider, inter alia, whether the nonattorney’s conduct is done
without knowledge that the action was improper, whether the corporation acted diligently in
correcting the mistake by obtaining counsel, whether the nonattorney’s participation is
minimal, and whether the participation results in prejudice to the opposing party. See, e.g.,
Szteinbaum v. Kaes Inversiones y Valores, C.A., 476 So. 2d 247, 252 (Fla. Dist. Ct. App.
1985); Starrett v. Shepard, 606 P.2d 1247, 1253-54 (Wyo. 1980). The circuit court may
properly dismiss an action where the nonlawyer’s participation on behalf of the corporation
is substantial, or the corporation does not take prompt action to correct the defect. See, e.g.,
Joseph Sansone Co. v. Bay View Golf Course, 97 S.W.3d 531, 532 (Mo. Ct. App. 2003);
Niklaus v. Abel Construction Co., 83 N.W.2d 904, 911 (Neb. 1957).
¶ 32 In the instant case, the trial court should have allowed Downtown Disposal to amend its
complaints for administrative review. It is evident that Van Tholen was unaware he could not
prepare and sign the complaints on behalf of the corporation. In fact, the administrative law
officer advised Van Tholen that: “You have a right to appeal the decision to the Circuit Court
within 35 days of today’s date, and you would do that in Room 602 of the Daley Center.”
Even though the corporation was the party before the administrative hearing, Van Tholen
appeared on its behalf and he, as a layperson, could reasonably have interpreted the “you”
to mean him personally. Likewise, Van Tholen’s participation was minimal. Van Tholen
filled in a preprinted blank form with plaintiff’s name, address, the date of the administrative
decision, and the docket numbers. Van Tholen made no unscrupulous attempt to litigate on
behalf of the corporation. Downtown Disposal retained counsel prior to any involvement by
the City in the case other than having been served. As this case demonstrates, the absence of
counsel at the threshold stage of the lawsuit—filing the complaint for administrative
review—could not have prejudiced the City. As such, Downtown Disposal’s commencement
of the proceedings without the assistance of counsel was essentially inconsequential. See In
re IFC Credit Corp., 663 F.3d at 321. For all practical purposes, Downtown Disposal was
represented by counsel before the City became a player in the action, so neither the City nor
the trial court was ever in the position of having to deal with a corporation unrepresented by
counsel.
¶ 33 Further, deeming the complaints a nullity would be harsh: it “would yield the ironic result
of prejudicing the constituents of the corporation, the very people sought to be protected by
the rule against the unauthorized practice of law.” Szteinbaum, 476 So. 2d at 250. See also
First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792 A.2d 325, 331 (Md.
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Ct. Spec. App. 2002) (filing of notice of appeal on behalf of corporation is “a protective
course of action, meant to preserve the corporation’s right to appeal”). Thus, rather than
protecting the litigant (Downtown Disposal), application of the nullity rule would prejudice
it. Downtown Disposal would lose its right to appeal and, thus, any remedy as might be
provided for by law.
¶ 34 Moreover, there is clearly an alternative remedy to dismissal—allowing amendment of
the complaints to add counsel’s signature. Thus, it would indeed be a very harsh consequence
to the corporation to apply the nullity rule to the case at bar.
¶ 35 We further disagree with the City that, if we affirm the appellate court, nonattorney
representation of corporations will become commonplace. We agree with the Seventh Circuit
that circuit court judges will be vigorous enforcers of the rule prohibiting nonattorneys from
representing corporations.
¶ 36 Based on the foregoing principles, we reject the City’s contention that any act of legal
representation undertaken by a nonattorney on behalf of a corporation renders the
proceedings void ab initio. We hold that the lack of an attorney’s signature on a complaint
for administrative review filed on behalf of a corporation does not render the complaint null
and void or mandate dismissal in all instances. In situations where a nonattorney signs a
complaint for administrative review on behalf of a corporation, the trial court should afford
the corporation an opportunity to retain counsel and amend the complaint if the facts so
warrant.
¶ 37 CONCLUSION
¶ 38 We conclude that the trial court erred in dismissing Downtown Disposal’s complaints
for administrative review based on the fact they were signed by Van Tholen because the lack
of an attorney’s signature was not jurisdictional and, therefore, did not render the proceedings
null and void. Moreover, in the instant case, application of the nullity rule would be a harsh
result since neither of the purposes underlying the rule are implicated and an alternative
remedy was available. Accordingly, we affirm the appellate court’s judgment, which reversed
the circuit court’s dismissal of Downtown Disposal’s complaints and remanded for further
proceedings.
¶ 39 Appellate court judgment affirmed.
¶ 40 JUSTICE KARMEIER, dissenting:
¶ 41 Today, for the first time, the Supreme Court of Illinois has sanctioned the unauthorized
practice of law by refusing to follow the nullity rule requiring dismissal of a complaint filed
in circuit court on behalf of a corporation by a lay person with no legal training of any kind.
Effectively overruling an unbroken line of precedent dating back before the Civil War, it
gives legal recognition to proceedings initiated by lay persons on behalf of third parties and
concludes that whether such proceedings should be dismissed is now discretionary with the
trial court. Then, without affording the circuit court an opportunity to exercise such
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discretion, as would normally be done where a new legal standard has been adopted for the
first time on review, it takes the extraordinary step of undertaking the analysis itself and then
decreeing that the complaints filed by the lay person on behalf of the corporation in this case
must be reinstated. And it justifies that result on the dubious grounds that reinstatement is
necessary to protect this corporation from what it perceives as “a very harsh consequence,”
overlooking that the company on whose behalf it has altered the law had repeatedly violated
city ordinances and then defaulted when charges were filed against it; that the corporation
appeared in the case only after fines were imposed on it and then attempted to have the
defaults set aside by claiming lack of notice, even though it is clear from the record that the
violation notices had been sent to the very address provided by the corporation itself; that the
corporation did not, in fact, act diligently to secure the assistance of a licensed attorney, but
instead waited for six months after the complaints for administrative review were filed by
its lay president before obtaining counsel to represent it; that the corporation was
subsequently involuntarily dissolved by the State of Illinois before the case was even argued
in our court, precluding the corporation from conducting future business in Illinois and
significantly diminishing the possibility that the City will ever be able to recover the fines
the corporation owes; and that, in any event, the corporation could have readily avoided any
possible “harshness” here had it simply done what corporations in Illinois have always been
required to do: hire a lawyer before seeking relief from the courts. Under all of these
circumstances, I believe that the corporation’s complaints were properly dismissed by the
circuit court and that the appellate court erred when it reversed the circuit court’s judgment.
I therefore respectfully dissent.
¶ 42 The legal principles presented by this appeal are well established. Because of the
prohibition against the unauthorized practice of law, our court has long recognized that no
person is permitted to commence an action in an Illinois court of record on behalf of another
unless he or she is an attorney. Robb v. Smith, 4 Ill. 46 (1841). A lay person may appear only
in his or her own behalf. City of Chicago v. Witvoet, 12 Ill. App. 3d 654, 655 (1973). A lay
person may therefore not initiate proceedings on behalf of someone else (see Ratcliffe v.
Apantaku, 318 Ill. App. 3d 621, 626 (2000); Blue v. People, 223 Ill. App. 3d 594, 596-97
(1992); Leonard v. Walsh, 73 Ill. App. 2d 45, 48 (1966)), including a partnership (National
Bank of Austin v. First Wisconsin National Bank, 53 Ill. App. 3d 482, 488-89 (1977)) or a
corporation (Berg v. Mid-America Industrial, Inc., 293 Ill. App. 3d 731, 737 (1997)). If a
corporation wishes to seek redress in an Illinois court, the proceeding must be brought by an
attorney acting on its behalf. Edwards v. City of Henry, 385 Ill. App. 3d 1026, 1036 (2008);
see People ex rel. Schacht v. Main Insurance Co., 114 Ill. App. 3d 334, 340 (1983)
(corporation may only appear by attorney); Tom Edwards Chevrolet, Inc. v. Air-Cel, Inc., 13
Ill. App. 3d 378, 379-80 (1973) (same); Nispel v. Western Union R.R. Co., 64 Ill. 311, 313-
14 (1872). An action filed on behalf of a corporation without an attorney is null and void ab
initio. Adair Architects, Inc. v. Bruggeman, 346 Ill. App. 3d 523, 525-26 (2004); Berg v.
Mid-America Industrial, Inc., 293 Ill. App. 3d at 737; Aarrow Ambulance v. Davis, 16 Ill.
App. 3d 318, 319 (1974); Remole Soil Service, Inc. v. Benson, 68 Ill. App. 2d 234, 238-40
(1966); see 4 Ill. L. and Prac. Attorneys and Counselors § 12 (2007). Because such an action
is void ab initio, it cannot result in a valid judgment even if all subsequent appearances on
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behalf of the corporation are made by a duly licenced attorney and the attorney adopts the
pleadings improperly prepared by a nonlawyer agent for the corporation. LVNV Funding,
LLC v. Trice, 2011 IL App (1st) 092773, ¶ 18; Edwards v. City of Henry, 385 Ill. App. 3d
1026, 1036 (2008); Housing Authority v. Tonsul, 115 Ill. App. 3d 739, 740 (1983); see
Marken Real Estate & Management Corp. v. Adams, 56 Ill. App. 3d 426, 428-29 (1977).
¶ 43 This so-called nullity rule has been applied to invalidate a notice of appeal filed on behalf
of a corporation by a person who is not a licensed attorney. Midwest Home Savings & Loan
Ass’n v. Ridgewood, Inc., 123 Ill. App. 3d 1001 (1984). It has likewise been invoked to
invalidate a proceeding seeking administrative review in circuit court where the complaint
for administrative review was filed by a lay officer of the corporation seeking review and not
by a licensed attorney. Siakpere v. City of Chicago, 374 Ill. App. 3d 1079, 1081 (2007). That
is precisely the situation before us here. Pursuant to the Illinois authority set forth above, the
circuit court was therefore entirely correct in granting the City’s motion to dismiss
Downtown Disposal’s complaints for administrative review.
¶ 44 Contrary to the view taken by the appellate court and adopted by the majority’s opinion,
this court’s decision in Applebaum v. Rush University Medical Center, 231 Ill. 2d 429(2008), does not support relaxation of the nullity rule under the situation present in this case.
In contrast to the circumstances before us here, Appelbaum was not a case where a lay person
was engaged in the unauthorized practice of law. To the contrary, the person whose conduct
was at issue there was a licensed attorney. He was simply on inactive status. Emphasizing
that
“an individual who has (i) graduated from law school; (ii) satisfied this court’s
character and fitness requirements; (iii) passed the bar examination; and (iv) obtained
a license to practice law in this state does not become ‘unlicensed’ by simply
choosing to change his or her ARDC registration status from active to inactive,”
we concluded in Applebaum that the nullity rule should not be applied and that the circuit
court did not err when it denied a motion to dismiss a cause of action filed by an attorney on
inactive status. Applebaum, 231 Ill. 2d at 446-48.
¶ 45 That the pleadings were filed by an attorney and there was no issue as to the unauthorized
practice of law were pivotal to the analysis in Applebaum. Those factors were likewise
central to our decision in Ford Motor Credit Co. v. Sperry, 214 Ill. 2d 371 (2005), where we
reaffirmed the validity of the nullity rule, but found the rule inapplicable to a situation where
the lawyers in question were licensed but had merely failed to register properly, noting that
“duly licensed attorneys who practice with a law firm that lacks Rule 721(c) registration do
not, by virtue of the unregistered nature of the law firm, engage in the unauthorized practice
of law.” Id. at 390.
¶ 46 In this case, of course, the prohibition against the unauthorized practice of law is
implicated directly and unequivocally. The complaint was not filed by a lawyer, but by a lay
agent of the corporation with no legal credentials or training of any kind. That is something
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the law of this state simply does not permit and has never permitted.1
¶ 47 It is true, as the appellate court noted (407 Ill. App. 3d at 834), that Applebaum says that
“where a person who is not licensed to practice law in Illinois attempts to represent another
party in legal proceedings, this rule permits dismissal of the cause, thereby treating the
particular actions taken by that person as a nullity.” (Emphasis added.) Applebaum, 231 Ill.
2d at 435. This language, however, cannot be cited for the proposition that this court now
views the nullity rule as discretionary in cases involving proceedings initiated by lay persons.
That is so for two reasons. First, the authority cited by Applebaum for this statement of the
law is Ford Motor Credit Co. v. Sperry, 214 Ill. 2d at 390. But what we actually said in Ford
Motor Credit Co. was that “it is well settled that the ‘effect of a person’s unauthorized
practice on behalf of a party is to require dismissal of the cause or to treat the particular
actions taken by the representative as a nullity.’ [Citations.]” (Emphasis added.) Id. If
something is required, it is not optional. To this extent, Applebaum’s characterization of our
holding in Ford Motor Credit Co. is inaccurate.
¶ 48 Second, the language we used in Applebaum must be taken in context. As previously
noted, Applebaum did not involve the unauthorized practice of law by a lay person. The issue
before us was whether the nullity rule should be applied to a situation where the person who
filed the legal action was duly licensed as an attorney, but had merely changed his
registration status to inactive.
¶ 49 Where the courts of Illinois have declined to apply the nullity rule, it has been in
situations like the one in Applebaum where an actual lawyer was involved or appeared to be
involved in the case at the time the proceeding was initiated. See Ford Motor Credit Co. v.
Sperry, 214 Ill. 2d 371 (nullity rule not applied to situation where law firm representing
plaintiff corporation had simply failed to register under Supreme Court Rule 721); Pratt-
Holdampf v. Trinity Medical Center, 338 Ill. App. 3d 1079 (2003) (trial court erred in finding
plaintiff’s complaint to be a nullity where she had consciously chosen to be represented by
a licensed Illinois attorney before proceeding; had received guidance, direction and assurance
from that attorney prior to filing her complaint; and was represented by licensed counsel,
including the lawyer who initially counseled her, at every step of proceedings after the initial
complaint was filed); McEvers v. Stout, 218 Ill. App. 3d 469 (1991) (nullity rule should not
be applied where complaint was filed by out-of-state lawyer not licensed in Illinois);
Moushon v. Moushon, 147 Ill. App. 3d 140 (1986) (nullity rule held inapplicable where the
complaint was signed by plaintiff corporation’s president, but the complaint recited that the
corporation “comes by its attorney” and the trial court record disclosed that the corporation
was, in fact, represented by a licensed attorney at every stage of the proceeding); Janiczek
v. Dover Management Co., 134 Ill. App. 3d 543, 547 (1985) (error to dismiss complaint as
void ab initio under nullity rule where the action brought by an attorney who was disbarred,
1
The rules of our court now allow corporations to defend themselves in certain small claims
proceedings through any officer, director, manager, etc., without regard to whether that person is a
lawyer. But this is not a small claims proceeding and the corporation is bringing suit, not defending
against a claim. Ill. S. Ct. R. 282(b) (eff. July 1, 1997).
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reasoning that dismissal was unreasonably harsh sanction against an innocent lay person who
never “consciously elected to be represented by a layman”). None of these circumstances are
present here. The person who filed the complaint for administrative review on behalf of
Downtown Disposal was a lay person. He was not and had never been admitted to the bar
of Illinois or any other jurisdiction, and there is no indication in the record that the
corporation was not fully aware of his lay status.
¶ 50 The majority opinion cites numerous decisions from other jurisdictions which it claims
support the view that actions by nonattorneys on behalf of a corporation are curable defects.
As recently noted by this court, however, the fact that “everybody’s doing it” is scarcely a
litmus test for the validity of a legal proposition. See Lebron v. Gottlieb Memorial Hospital,
237 Ill. 2d 217, 249 (2010). “Although decisions from other jurisdictions can provide
guidance where precedent from Illinois is lacking” (id.), “Illinois courts do not look to the
law of other states when there is relevant Illinois case law available” (In re Estate of Walsh,
2012 IL App (2d) 110938, ¶ 45). Such authority is available here. To borrow a phrase from
Lebron v. Gottlieb Memorial Hospital, 237 Ill. 2d at 249, “we do not write today on a blank
slate.” To the contrary, there is abundant precedent from Illinois to support the circuit court’s
decision to apply the nullity rule in this case. That is the precedent which should guide our
decision. People v. Ward, 2011 IL 108690, ¶ 28.
¶ 51 I note, moreover, that of the many decisions from other jurisdictions listed by the
majority, only a very few actually support the position my colleagues adopt today. If any
movement toward relaxing the prohibitions against the unauthorized practice of law and
rejection of the nullity rule may be discerned from those decisions, and I am not sure it can,
the shift is scarcely a deluge. In truth, it is barely a trickle. Let us go through the list.
¶ 52 United States v. High Country Broadcasting Co., 3 F.3d 1244 (9th Cir. 1993), a per
curiam opinion by the Ninth Circuit, did not involve the nullity rule or even a situation in
which a court proceeding was initiated by a lay person on behalf of a third party, but it did
invoke the principle that a “corporation may appear in federal court only through licensed
counsel.” Relying on that principle, the court affirmed entry of a default judgment entered
against a corporation after the attorney who filed the answer and cross-complaint on behalf
of the corporation withdrew, the corporation’s lay president and sole shareholder then
attempted to undertake defense of the company, and the company failed to retain counsel
after being directed by the court to do so.
¶ 53 In Jones v. Niagara Frontier Transportation Authority, 722 F.2d 20 (2d Cir. 1983), the
court reaffirmed the “venerable and widespread” rule that a corporation may litigate only
through a duly licensed attorney (id. at 22) and held that a corporation could not circumvent
that rule by assigning its claims to the corporation’s sole shareholder, who was a lay person.
In so doing, it cited with approval a point made in an earlier decision which, as will be noted
later in this dissent, is also relevant here and which the majority should heed:
“To allow [the lay individual] to appear pro se in this suit would be allowing him to
flout a well-established and purposeful public policy by means of a procedural
device. [The lay individual] chose to accept the advantages of incorporation and must
now bear the burdens of that incorporation; thus, he must have an attorney present
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the corporation’s legal claims. [Citation.]” Id. at 23.
¶ 54 Southwest Express Co. v. Interstate Commerce Comm’n, 670 F.2d 53 (5th Cir. 1982),
was a per curiam opinion which dismissed a petition for administrative review of a decision
by the Interstate Commerce Commission filed on behalf of a corporation by the company’s
president and principal shareholder, who was a nonlawyer, on the grounds that corporations
may only appear in court through counsel and while the company’s president could represent
himself in court, he had no basis for asserting a personal claim based on the administrative
decision at issue. That is the same situation here, of course, and the decision therefore
supports, rather than undermines, the dismissal order entered by the circuit court in this case.
¶ 55 Strong Delivery Ministry Ass’n v. Board of Appeals, 543 F.2d 32 (7th Cir. 1976), also
supports the circuit court’s decision here. In Strong, two actions were consolidated on appeal,
both involving the right of lay persons to bring proceedings in federal court on behalf of third
parties. Plaintiff in the first action was a nonprofit corporation which brought a civil rights
action against certain defendants. It appeared through its president and founder, who was a
clergyman, not a lawyer. The district court dismissed the action without reaching the merits
because the corporation was not represented by counsel, and the corporation sought appellate
review.
¶ 56 In the second action, defendants moved to dismiss a plaintiff corporation’s appeal on the
grounds that the notice of appeal had been filed by the corporation’s lay president and the
corporation was not represented by a lawyer. In another per curiam opinion, the court of
appeals affirmed the judgment in the first action and granted the motion to dismiss the appeal
of the second action, adhering to established law that corporations may not proceed in federal
court through lay representation, but must appear through counsel.
¶ 57 The next case cited by the majority is United States v. 9.19 Acres of Land, More or Less,
Situate in Marquette County, Michigan, 416 F.2d 1244 (6th Cir. 1969), which involved a
condemnation proceeding brought by the federal government to obtain property owned by
a closely held corporation. The sole issue on the appeal was whether the trial court erred
when it ruled that the corporation could not appear and defend through its lay president and
refused to grant a continuance to permit the corporation to hire a lawyer. Reaffirming the
principle that corporations may only appear in court through counsel, the court of appeals
upheld the trial court’s determination that the lay president could not represent the
corporation in the proceedings. Because the corporation’s land had already been taken and
the sole issue was that of compensation, a matter over which there was apparently no
urgency, and because the corporation’s president had not been aware until a week before trial
that he would not be permitted to represent the corporation himself and had made efforts to
secure legal representation, the court of appeals concluded that the trial court abused its
discretion when it denied a continuance to permit the corporation to obtain qualified counsel.
But whether a trial court abuses its discretion with respect to granting a corporation
additional time to obtain legal representation to help defend it has no bearing on the nullity
rule and the validity of proceedings initiated by lay persons on behalf of corporations. Again,
therefore, this authority does not support the result reached by the majority in this case.
¶ 58 Flora Construction Co. v. Fireman’s Fund Insurance Co., 307 F.2d 413 (10th Cir. 1962),
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is likewise inapposite. As with the preceding case, it did not involve the viability of an action
brought on behalf of a corporation by a lay person, the issue before us here. It was a
challenge to an order by the trial court denying a corporation the right to appear and defend
itself in a civil action through its president, who was not a lawyer. After ruling that the trial
court’s order was not appealable, the court of appeals elected to treat the papers presented
by the corporation as an application for leave to file a petition for writ of mandamus to
compel the trial court to permit it to appear by its nonlawyer president. It then denied the
application for mandamus based on the “rule [which] is well established that a corporation
can appear in a court of record only by an attorney at law.” Id. at 413-14.
¶ 59 Operating Engineers Local 139 Health Benefit Fund v. Rawson Plumbing, Inc., 130 F.
Supp. 2d 1022 (E.D. Wis. 2001), is the last of the federal cases itemized by the majority, and
it does not help them either because, once again, it does not involve an attempt by a lay
person to initiate proceedings in court on behalf of a corporation. The issue in Operating
Engineers Local 139, a United States district court case which was still at the trial court
level, was whether the plaintiff was entitled to entry of a default judgment in its favor where
the answer filed by the defendant corporation was signed by a nonlawyer agent of the
company who was not admitted to the bar. The United States district court reaffirmed that
corporations may appear only through counsel and held that the “attempted answer” filed by
the corporation’s lay agent could not stand, but after noting, inter alia, that nullity principles
had not previously been applied to defective answers, it concluded that the appropriate course
was to grant the corporation additional time to appear and defend by counsel before finding
it in default. Id. at 1023-24.
¶ 60 The majority’s string of federal citations thus turns out to yield nothing that helps it.
What then of its even lengthier string of state citations? Here is what they actually say.
¶ 61 The first case on the list turns out to be a one-paragraph disposition from Alabama, A-OK
Construction Co. v. Castle Construction Co., 594 So. 2d 53 (Ala. 1992). Unlike our case, A-
OK Construction did not involve a situation where any of the proceedings were initiated by
a nonlawyer. What happened there was that after judgment was entered against a company
in the trial court and the company’s attorney filed the notice of appeal, the attorney withdrew.
The only brief filed on behalf of the company was signed by the company’s president, who
was a lay person. After noting that companies are only permitted to appear in court through
an attorney and pointing out that it could dismiss the appeal based on the company’s failure
to file a brief or prosecute the appeal, the court determined that because the proper outcome
of the case was apparent, it would suspend its normal procedural rules and simply affirm the
judgment on the merits.
¶ 62 Next is Boydston v. Strole Development Co., 969 P.2d 653 (Ariz. 1998) (en banc). Of all
the cases from other jurisdictions offered up by the majority so far, this is the first that
actually offers some support for its position. There, after judgment was entered against a
corporation and the corporation’s attorneys withdrew from the case, a nonlawyer officer of
the company filed a notice of appeal on behalf of the company, something that was
unquestionably improper. The plaintiff-appellees could have objected but, unlike the City in
this case, they did not. It was the court of appeals that identified the problem, and it
dismissed. As soon as the dismissal order was entered, counsel immediately appeared on
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behalf of the corporation and the case was briefed and argued on the merits. The appellate
court subsequently determined that it had been correct to dismiss the appeal based on the
improper notice of appeal filed by the nonlawyer, but the Arizona Supreme Court reversed,
reinstated the appeal, and remanded for resolution of the appeal on the merits. In so doing,
it concluded that while the absence of a lawyer’s signature on the notice of appeal rendered
the notice defective, Arizona law affords litigants a reasonable opportunity to cure such
defects before dismissal is ordered, at least where the notice was neither misleading nor
prejudicial to the appellee. Id. at 656-57.
¶ 63 Rogers v. Municipal Court for the Sonoma County Judicial District, 243 Cal. Rptr. 530(Cal. App. 1988), a California case which the majority cites next, involved a situation where
a corporation sought a de novo hearing in court regarding its obligation to pay back wages
to an employee following an adverse ruling by the state’s labor commissioner. The request
for de novo review was signed by the corporation’s president, who was not a lawyer, and the
employee challenged it on that basis. The appellate court concluded, however, that filing the
particular type of notice necessary to request a de novo review did not constitute the practice
of law under California law and therefore did not render the notice invalid. Id. at 532. As
noted earlier, the majority in our case has correctly concluded that the conduct at issue here
does constitute the unauthorized practice of law. Rogers therefore does not support the
majority’s argument.
¶ 64 BQP Industries, Inc. v. State Board of Equalization, 694 P.2d 337, 341-42 (Colo. App.
1984), is distinguishable for the same reason. It involved the filing of property tax appeals
with an administrative body by corporate taxpayers. The requisite appeal forms were signed
by nonlawyers on behalf of the corporations. All other steps in appeal were handled by
attorneys. The appeal forms were ultimately challenged on the grounds that they should have
been signed by lawyers, but the court of appeals rejected the notion that completion of the
forms involved the practice of law and held that they were “sufficiently informal to permit
completion by a corporation through its officer or director.” Id. at 342.
¶ 65 With Torrey v. Leesburg Regional Medical Center, 769 So. 2d 1040 (Fla. 2000), the
majority takes us next to Florida, but the results are no more supportive of its view. Unlike
the situation before us here, Torrey did not involve a proceeding initiated on behalf of a
corporation by a lay person untrained in the law. At issue there was the validity of a
wrongful-death action alleging medical malpractice filed by an out-of-state attorney.
Defendants moved to dismiss on the grounds that because the complaint was filed by an
attorney who was not licensed in Florida, it was a nullity. The circuit court agreed and the
appellate court affirmed, but the state’s supreme court reversed and remanded, holding that
the defect was subject to correction and that the unauthorized practice concerns were more
appropriately dealt with through other mechanisms, including injunctive relief and
disciplinary action against the offending out-of-state lawyer. Id. at 1045. This result is
consistent with Illinois case law, which, as I have discussed, has relaxed the nullity rule
where an actual lawyer was involved or appeared to be involved in a case at the time the
proceeding was initiated. Illinois courts do not take that approach where, as here, the
proceeding is brought by a lay person.
¶ 66 Rainier Holdings, Inc. v. Tatum, 622 S.E.2d 86 (Ga. App. 2005), a Georgia case cited by
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my colleagues, did not involve the viability of a legal proceeding initiated by a lay person on
behalf of another party, but was another of the cases addressing the consequences of having
a lay person sign an answer to a complaint filed against a corporate defendant. There was no
discussion as to the nullity rule, and as with the other similar cases cited by the majority, it
is therefore distinguishable.2
¶ 67 In Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw.
1979), a corporate defendant moved to set aside entry of a default judgment against it
through its vice president, a nonlawyer, arguing that the corporate defendant had not received
notice of a change in the time and place of trial, resulting in its failure to appear and defend.
Plaintiff’s attorney objected on the grounds that as a nonlawyer, the vice president was not
authorized to represent the corporation. The trial court agreed and on that basis refused to
disturb the default judgment. On appeal, the state supreme court affirmed, concluding that
the vice president, as a nonattorney officer of the corporate defendant, “should not have been
allowed to act at all as the in-court representative of [the defendant and on] that ground
alone, we would be able to decide that the result reached by the court below was proper.” Id.
at 576.
¶ 68 Next comes Hawkeye Bank & Trust, National Ass’n v. Baugh, 463 N.W.2d 22, 26 (Iowa
1990), where a bank sued a closely held corporation to set aside a fraudulent conveyance of
farmland. The defendant corporation’s president, who was not a lawyer, attempted to
represent the corporation. When trial of the cause was set to begin, the bank’s attorney
objected that the president’s appearance on behalf of the corporation constituted the
unauthorized practice of law and should not be permitted. The trial court agreed and, after
denying the president’s request for a continuance to obtain an attorney, heard the bank’s
evidence and entered judgment for the bank. On appeal, the Iowa Supreme Court agreed with
the trial court that the corporation could only appear through counsel, but thought that under
the circumstances, most notably the fact that no objection was raised as to the president’s lay
status until the actual morning of the trial, it was an abuse of discretion for the court to have
proceeded without affording an opportunity for the corporation to obtain legal representation.
Again, that is not this case. Here, the corporation’s lay agent attempted to initiate
proceedings in court, and his right to do so was challenged at the outset of the proceedings.
¶ 69 As with Boydston v. Strole Development Co., 969 P.2d 653 (Ariz. 1998), the Arizona
case discussed above, the majority is on firmer ground with First Wholesale Cleaners Inc.
v. Donegal Mutual Insurance Co., 792 A.2d 325 (Md. App. 2002), a case involving a lawsuit
by a dry cleaning company against its insurance company. In that case, the insurance
company successfully moved to dismiss with prejudice after the attorney for the dry cleaning
company sought and was granted leave to withdraw from the case. The sole shareholder of
the dry cleaning company then filed a notice of appeal, having been advised by the former
2
Georgia is also a special case because, at least according to the very next decision cited by
the majority, Oahu Plumbing & Sheet Metal, Ltd. v. Kona Construction, Inc., 590 P.2d 570 (Haw.
1979), it is “the only state which permits a corporation to be represented by a non-attorney agent.”
Id. at 575 n.10.
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lawyer that he was entitled to do so, attempting to retain replacement counsel and succeeding
in doing so after the case was docketed. The insurance company moved to dismiss the appeal
on the grounds that the shareholder’s action constituted the unauthorized practice of law and
rendered the appeal a nullity. In denying that request, the Maryland Court of Special Appeals
held that “[p]leadings filed and actions taken by a non-lawyer corporate officer in a legal
action are subject to be stricken or held to be a nullity,” but determined that such action was
not warranted in this particular case “wherein the representation was very limited” and “[t]he
record does not reflect that the representation was made with knowledge of its impropriety,
it was followed within a reasonable time by proper representation through an attorney
admitted to practice before the court, and the other party was not substantially prejudiced
thereby.” Id. at 333-34.
¶ 70 If First Wholesale Cleaners Inc. gives hope to the majority’s view, Waite v. Carpenter,
496 N.W.2d 1 (Neb. Ct. App. 1992), the next case it cites, takes it away. There a nonlawyer
personal representative of an estate filed five wrongful-death actions for medical negligence
with the purpose of recovering damages. Defendants successfully moved to dismiss or for
summary judgment on the grounds that the nonlawyer was engaged in the unauthorized
practice of law, rendering the pleadings he had filed a nullity. The Nebraska Court of
Appeals unanimously affirmed, adding that the nonlawyer was not entitled to additional time
to retain counsel before the matter was dismissed because affording him that option would
mean that he “would have engaged in the unauthorized practice of law to the possible
detriment of the heirs, the defendants, and the courts with complete impunity.” Id. at 7.
¶ 71 In the majority’s next cited case, KSNG Architects, Inc. v. Beasley, 109 S.W.3d 894 (Tex.
Ct. App. 2003), the president of the defendant corporation, a lay person, attempted to file an
answer on the company’s behalf. The trial court struck the answer and immediately entered
judgment against the company. On appeal, the Texas Court of Appeals affirmed the principle
that corporations may not appear through an individual officer who is not a lawyer and
agreed that the answer filed by the company’s president was therefore defective. It
concluded, however, that the trial court abused its discretion when it struck the answer
without affording the company an opportunity to hire an attorney and replead. In reaching
this result, it was careful to distinguish the situation from one where the offending
corporation initiates the litigation (id. at 897), and it did not rely on the nullity doctrine.
Rather, it treated the motion to strike as tantamount to a “plea of abatement,” a mechanism
under Texas civil procedure by which one can prevent a suit from going forward based on
facts outside the pleading until the defect is cured. Under Texas law, a plea of abatement may
not be used to decide the merits of a case and judges are supposed to allow parties a
reasonable opportunity to amend pleadings to correct defects alleged in a plea in abatement.
Id. at 898-99. Because those standards were not followed by the trial court in the case, the
Court of Appeals reversed and remanded for further proceedings.
¶ 72 Graham v. Davis County Solid Waste Management & Energy Recovery Special Service
District, 1999 UT App 136, 979 P.2d 363, involved an action alleging that the defendant had
violated Utah’s Government Records Access and Management Act. The action was
originally brought by an unincorporated association which had not complied with the state’s
assumed-name statute and the association was represented by a nonlawyer, which Utah law
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does not permit. Those problems were subsequently cured when the nonlawyer was
substituted as the plaintiff in his own name. The trial court then entered summary judgment
against the plaintiff on the merits. The appellate court affirmed. In so doing, it first rejected
an argument by defendant that the problems which existed before the individual plaintiff was
substituted in should have rendered the pleading a complete nullity. In the view of the Utah
court, the problems were simply technical in nature. Id. ¶ 16. This is of little help here, of
course, because under Illinois law, the unauthorized practice of law is more than a
technicality.
¶ 73 This brings us to the majority’s final case, Starrett v. Shepard, 606 P.2d 1247 (Wyo.
1980). In that case, the plaintiff, a man named Shepard, operated a motor vehicle repair
business and a bulk retail-wholesale outlet for petroleum products. He sued the Starretts “on
an account stated for work, labor and services and for interest thereon.” The Starretts, in turn,
brought a third-party action against Northwest Carriers, Inc. Following a trial on the merits,
the court entered judgment for Shepard on his claim against Starretts and for Northwest on
the Starretts’ claim against it. On appeal, the Wyoming Supreme Court affirmed the
judgment in favor of Shepard but reversed the judgment in favor of Northwest and against
the Starretts and remanded for a new trial on that claim. In so doing, it rejected an argument
by the Starretts that because a lay agent of Northwest had initially filed a motion to quash
service, they were entitled to entry of a default judgment as a matter of law and no new trial
should be held. That has no bearing on this case, however, because it involved a situation
where the corporation was the defendant, not one where a lay agent had initiated legal
proceedings on behalf of the company. Moreover, the action by the lay agent was a limited
and tangential part of the proceedings. The filing of responsive pleadings and all subsequent
aspects of the company’s defense were handled by counsel and the Starretts were not
substantially prejudiced by the lay person’s actions on behalf of the company.
¶ 74 It thus appears that of the numerous decisions invoked by the majority from federal and
state jurisdictions, only two, Boydston v. Strole Development Co., 969 P.2d 653 (Ariz. 1998),
from Arizona, and First Wholesale Cleaners Inc. v. Donegal Mutual Insurance Co., 792
A.2d 325 (Md. App. 2002), an intermediate appellate court case from Maryland, provide any
support for my colleagues’ view that the nullity rule should be relaxed where, as here, court
proceedings are initiated by a lay person. Most are readily distinguishable. Some are fully
consistent with settled Illinois law and are therefore directly contrary to the position taken
by the majority in the matter before us here.
¶ 75 The majority next finds insight in the Seventh Circuit’s recent decision in In re IFC
Credit Corp., 663 F.3d 315 (7th Cir. 2011), and its discussion of subject matter jurisdiction
conferred on Article III federal courts. Of course, jurisdiction of Illinois courts is determined
by the Illinois Constitution of 1970, not Article III of the Constitution of the United States,
and this court has made the point that state and federal jurisdictional principles differ in
significant ways. Lebron v. Gottlieb Memorial Hospital, 237 Ill. 2d 217, 254 n.4 (2010). But
even to the extent that this court’s definition of subject matter jurisdiction corresponds to
federal law, I do not believe that principles of subject matter jurisdiction are helpful to
understanding and applying the nullity rule. “Subject matter jurisdiction refers to the court’s
power to hear and determine cases of the general class to which the proceeding in question
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belongs.” (Internal quotation marks omitted.) Crossroads Ford Truck Sales, Inc. v. Sterling
Truck Corp., 2011 IL 111611, ¶ 27. When courts apply the nullity rule in Illinois, it has
nothing whatever to do with their authority to act. The nullity rule pertains, instead, to the
legal effect of actions by lay persons who have no authority to assert claims on behalf of third
parties and
“is grounded in the fact that there are risks to individual clients and to the integrity
of the legal system inherent in representation by an unlicensed person: The purpose
of the nullity ‘rule is *** to protect litigants against the mistakes of the ignorant and
the schemes of the unscrupulous and to protect the court itself in the administration
of its proceedings from those lacking requisite skills.’ ” Ford Motor Credit Co. v.
Sperry, 214 Ill. 2d at 389-90 (quoting Janiczek v. Dover Management Co., 134 Ill.
App. 3d 543, 546 (1985)).
¶ 76 The nullity rule thus implicates considerations separate and distinct from considerations
of subject matter jurisdiction. Courts clearly possess subject matter jurisdiction of the type
of cases in which the nullity rule has arisen. They may nevertheless declare that conduct
occurring in the course of the proceedings is done without authority and therefore has no
legal effect. When that unauthorized conduct consists of the filing of a complaint by a lay
person, it cannot operate to invoke the court’s jurisdiction. Because the person filing the
pleading had no legal capacity to file it, it is as if it were never filed at all. That is why we
characterize it and the proceedings which flow from it as a nullity and why any resulting
judgment can have no possible legal effect.
¶ 77 Again, this is not a novel or unsettled question in Illinois. Until the appellate court in this
case misapplied our decision in Applebaum, the case law uniformly recognized that a judicial
proceeding initiated by a lay person on behalf of a corporation was invalid and must be
dismissed. No contrary conclusion is possible without sanctioning the unauthorized practice
of law, as the Illinois State Bar Association correctly warned in the amicus brief it was
permitted to file in the case. If application of the nullity rule is to be discretionary rather than
mandatory, it necessarily follows that there will be situations in which the unauthorized
practice of law will now be permitted in our courts.
¶ 78 Less than a year ago, our court amended its rules to expand the authority of the Attorney
Registration and Disciplinary Commission to enforce the prohibition against the
unauthorized practice of law through proceedings in circuit court. Ill. S. Ct. R. 752(b) (eff.
Dec. 7, 2011). That action was motivated by a recognition of the serious and growing harm
to the public and the administration of justice posed by the unauthorized practice of law and
the need for enhanced mechanisms to combat its spread. Through its decision here today, the
majority has tacitly rejected those concerns and set the judicial branch on a course that will
inevitably foster rather than inhibit unauthorized practice problems.
¶ 79 The majority attempts to justify this extraordinary change in course by minimizing the
significance of the lay person’s actions in this case. It describes his participation as minimal,
involving little more than inserting basic data into a preprinted form. Supra ¶ 32. In making
this argument, however, it forgets that earlier in the disposition, it expressly rejected the
argument advanced by the corporation that “there was no unauthorized practice of law
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because [the lay person] merely filled in blanks on a simple form that did not require the use
of any legal expertise.” Supra ¶ 16. “It is not the simplicity of the form that is important,” the
majority held, “but the fact that an appeal was pursued on behalf of a corporation by a
nonattorney.” Id.
¶ 80 In so holding, the majority echoes a point we made nearly 50 years ago in Chicago Bar
Ass’n v. Quinlan & Tyson, Inc., 34 Ill. 2d 116, 123 (1966), where we observed:
“Many aspects of law practice are conducted through the use of forms, and not all of
the matters handled require extensive investigation of the law. But by his training the
lawyer is equipped to recognize when this is and when it is not the case. Neither
counsel nor amici have suggested any practicable way in which an exception to the
general rule can be made where only the use of forms is involved, or where the
transaction is a ‘simple’ one. Mere simplicity cannot be the basis for drawing
boundaries to the practice of a profession. A pharmacist, for example might be
competent to prescribe for many of the simpler ailments, but it takes a medical
background to recognize when the ailment is simple. Protection of the public requires
that only licensed physicians may prescribe or treat for any ailment, regardless of
complexity or simplicity. And protection of the public requires a similar approach
when the practice of law is involved.”
¶ 81 So it is in this case. The mechanics of filing a complaint for administrative review are
never difficult. What can be very difficult indeed is assessing whether pursuing an appeal,
including administrative review in circuit court, is worthwhile and appropriate in a particular
case. To make that kind of judgment, legal training and experience are essential. When the
lay person took it upon himself to file the complaint for administrative review in circuit
court, Downtown Disposal was deprived of that critical threshold legal advice. As a result,
it was impelled into a course of action which may ultimately prove contrary to its best
interests if, for example, it cannot substantiate valid grounds for setting aside the defaults or,
if it succeeds at that, it is unable to establish a valid defense to the ordinance violation
charges.
¶ 82 This is not a situation involving an indigent pro se litigant who is forced to represent
himself because he lacks the resources to retain counsel. What we have here is a
corporation’s president who simply made the decision to personally file a complaint for
administrative review on behalf of his company. At no time did the company seek leave to
proceed in forma pauperis, and so far as I can tell, it has never claimed that there was some
impediment which hampered its ability to secure counsel to assist it with the filing in the first
instance.
¶ 83 Although Downtown Disposal was evidently not a large corporation, it was a corporation
nevertheless. The decision to organize and operate as a corporation brings with it substantial
economic benefits. With those benefits come burdens and limitations which must be borne
even by small corporations. See, e.g., In re Zisook, 88 Ill. 2d 321, 339 (1981). That includes
the obligation to retain counsel when the corporation wishes to initiate proceedings in circuit
court, a point made by Jones v. Niagara Frontier Transportation Authority, 722 F.2d 20 (2d
Cir. 1983), one of the federal cases discussed earlier which is cited by the majority itself.
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¶ 84 Even if I agreed with the majority’s substantive analysis, which I do not, I could not agree
with the manner in which the majority has chosen to dispose of this case. Whether the
majority’s decision to revise the nullity rule is sound or not, it is undeniable that the
discretionary standard my colleagues establish today represents a fundamental change in the
law. As noted at the outset of this disposition, this decision marks the first time ever our
court has held that the nullity rule does not require automatic dismissal of a proceeding
brought in circuit court on behalf of a corporation by a lay person with no legal training of
any kind.
¶ 85 Where, as here, our court determines on review that the standards which governed
resolution of the case in the trial court were incorrect and should be rejected, the appropriate
remedy is normally to remand the matter to the circuit court so that it can be litigated under
the proper legal standard. See, e.g., Reliable Fire Equipment Co. v. Arredondo, 2011 IL
111871, ¶ 45; People v. Masterson, 207 Ill. 2d 305, 330 (2003). Remand is particularly
appropriate where the legal standards we have articulated call for the exercise of discretion
by the trial court. See, e.g., People v. Longoria, 375 Ill. App. 3d 346, 351 (2007). That is
precisely the situation presented by the majority’s analysis. Instead of reversing outright the
trial court’s dismissal based on the nullity rule as it previously existed, we should, at a
minimum, afford the trial court an opportunity to reevaluate whether dismissal of Downtown
Disposal’s complaint for administrative review is appropriate under the new nullity rule
principles outlined in the majority’s opinion.
¶ 86 Without pausing to even acknowledge the possibility of allowing the circuit court the
chance to reconsider its dismissal order, the majority instead takes it upon itself to weigh the
various factors it now deems relevant, concluding that “it would indeed be a harsh
consequence to the corporation to apply the nullity rule to the case at bar.” I respectfully
disagree.
¶ 87 To support its view, the majority claims it is “evident that Van Tholen[, the corporation’s
president,] was unaware he could not prepare and sign the complaints on behalf of the
corporation.” Supra ¶ 32. But ignorance of the law is no excuse (People v. Hollins, 2012 IL
112754, ¶ 34), “[a] principle deeply imbedded in our system of jurisprudence” (People v.
Izzo, 195 Ill. 2d 109, 115 (2001)). Surely my colleagues do not mean to suggest that we
should carve out an exception to this principle for corporate executives.
¶ 88 In any case, it is not “evident” at all that Van Tholen did not actually understand that he
was prohibited by law from initiating legal proceedings on behalf of the corporation in circuit
court. In fact, we cannot ascertain from this record what Van Tholen knew or did not know,
for the record contains no testimony or statements from him regarding this matter. The
majority’s assertion is simply a supposition based solely on the general instructions Van
Tholen received from an administrative law officer who worked for the City and the officer’s
use of the word “you” in explaining what needed to be done next. I note, however, that as a
corporate executive, Van Tholen knew or should have known that there was no instance in
which Illinois law permitted corporate executives who were lay persons to initiate legal
proceedings in court on behalf of their corporate employers. If we are to speculate, the more
likely assumption would be that someone in Van Tholen’s position would have assumed that
by “you,” the administrative officer meant “your company.”
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¶ 89 At a minimum, Van Tholen should surely have realized that because the administrative
officer was employed by the City, not the Judicial Branch of the State of Illinois, issues
regarding the filing of judicial proceedings should have been directed to the clerk of the
circuit court. As it was, Van Tholen checked with no one. He filed the complaint on behalf
of the corporation, paid the filings fees, caused summons to be issued and then waited for the
City to respond.
¶ 90 From reading the majority’s opinion, one might get the impression that this was a
situation where the corporation acted promptly to correct the lack of the legal representation
it needed to prosecute these proceedings. In fact, that was not the case at all. The invalid
complaint for administrative review filed by Van Tholen on the corporation’s behalf was file
stamped by the clerk of the circuit court on October 16, 2008. No lawyer entered an
appearance on behalf of the corporation until April of 2009, six months later.3
¶ 91 The majority attempts to convince us that we need to fashion relief here in order to save
Downtown Disposal and the corporation’s “constituents” (whoever they may be) from unfair
prejudice. Let us not forget, however, that the scales of justice have two sides. We must
therefore also be mindful of the harm which the City of Chicago and its citizens have already
sustained as a result of Downtown Disposal’s actions.
¶ 92 Downtown Disposal did not come to the attention of municipal authorities because of its
charitable acts. It was cited by the City on four separate occasions for obstructing alleys with
dumpsters for construction debris without the necessary permits and, in one of those
instances, for also failing to affix reflective material to the dumpster’s corners. There is no
dispute that the ordinances in question served a legitimate public safety purpose and that
their placement of the dumpsters without prior city approval presented a public safety
concern.
¶ 93 The violations occurred on December 26, 2007; January 2, 2008; January 25, 2008; and
March 19, 2008. Three of the four notices involved placement of a dumpster at a location for
which the company had originally obtained a permit, but the permit had expired. In applying
for the permit, an employee of the company had been required to provide the company’s
address. The address used corresponded to the one which the City had on file for the
company. The violation notices were sent to that address in the manner provided by law. The
company failed to appear, however, and defaults were entered against it in all four cases. In
addition, the corporation was fined $1,500 plus fees for each violation.
¶ 94 The company made no effort to contest the violations until after the fines were imposed
and it realized that it owed the City a total of more than $6,000. As grounds for setting aside
3
The majority asserts that “[f]or all practical purposes, Downtown Disposal was represented
by counsel before the City became a player in the action.” Supra ¶ 32. “Player” is not a status
recognized by our administrative review laws and procedures, so I am not sure what the majority
means here. It seems to me, however, as I am sure it seemed to the City, that the City became “a
player” in this action as soon as Van Tholen attempted to file his complaint naming the City and
caused summons to be issued in 2008. That was well before the corporation had a lawyer to
represent it.
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the violations and resulting fines, the corporation, through its president, argued that the
address to which the notices had been sent, an address it had provided itself, was out-of-date
and that it had never been properly served. The record contains a handwritten letter by the
corporation’s president to someone in the City asking that the records be updated to reflect
a Blue Island, Illinois, address for the company instead of the address provided in the
company’s permit application. That letter, however, is dated September 16, 2008, nearly nine
months after the first violation and approximately six months after the fourth violation.
¶ 95 In challenging the sufficiency of the notices, the corporation’s president argued at the
administrative level that the City should have used the address which the company has used
in registering with the Illinois Secretary of State, but that was problematic too. The printout
the company provided from the Secretary of State’s office was from a report filed October
17, 2008, well after the violations. Moreover, neither of the two mailing addresses it listed,
one for the company’s president and one for its agent, corresponded to the Blue Island
address which the company’s president had submitted to the City the previous month. One
was in Chicago, the other in Indiana.
¶ 96 Aside from these arguments, which the administrative law officer understandably
rejected, the corporation proffered nothing that would warrant setting aside any of the
multiple findings of violations or suggest that the fines imposed on it were improper. And
yet, almost five years after Downtown Disposal was first cited, the case has yet to be
resolved, and so far as we can tell, the fines have never been paid. Moreover, it seems highly
unlikely at this point that they will ever be paid. Public records of the office of the Illinois
Secretary of State, of which courts may take judicial notice (see Maldonado v. Creative
Woodworking Concepts, Inc., 296 Ill. App. 3d 935, 938 (1998)), indicate that while this
appeal was pending, Downtown Disposal changed its name to SOL of Blue Island, Inc., and,
shortly before oral argument in March of 2012, the corporation was involuntarily dissolved.
To be sure, the dissolution did not abate the proceedings against the corporation (805 ILCS
5/12.30(c) (West 2010)). As a practical matter, however, the likelihood that the City will
succeed in collecting any of the fines is surely diminished. In light of all these circumstances,
I do not share the majority’s view that the City sustained no prejudice.
¶ 97 While application of the nullity rule may seem harsh in some cases, this is not such a
case. And in any event, the solution is simple, straightforward, and obvious in every case. If
you are a corporation in need of relief from the courts, all you need do to avoid the problem
encountered by Downtown Disposal here is hire a lawyer.
¶ 98 For the foregoing reasons, I would reverse the judgment of the appellate court and affirm
the judgment of the circuit court dismissing, as a nullity, the complaints for administrative
review filed in that court on behalf of Downtown Disposal by its president, a lay person who
was not and has never been authorized to practice law in Illinois or any other jurisdiction. I
therefore respectfully dissent.
¶ 99 CHIEF JUSTICE KILBRIDE and JUSTICE THOMAS join in this dissent.
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