International Union of Operating Engineers v. Office of the Comptroller , 2014 IL App (4th) 131079 ( 2014 )

FILED
2014 IL App (4th) 131079 December 12, 2014
Carla Bender
NOS. 4-13-1079, 4-13-1082 cons. th
4 District Appellate
Court, IL
IN THE APPELLATE COURT
OF ILLINOIS
FOURTH DISTRICT
INTERNATIONAL UNION OF OPERATING ) Appeal from
ENGINEERS, LOCAL 965, ) Circuit Court of
Plaintiff-Appellant, ) Sangamon County
v. ) Nos. 13MR397
OFFICE OF THE COMPTROLLER, State of Illinois, ) 13MR398
Defendant-Appellee. )
) Honorable
) John W. Belz,
) Judge Presiding.
______________________________________________________________________________
JUSTICE HARRIS delivered the judgment of the court, with opinion.
Justices Holder White and Steigmann concurred in the judgment and opinion.
OPINION
¶1 Plaintiff, International Union of Operating Engineers, Local 965 (Union), appeals
the circuit court's dismissal of two actions it filed seeking declaratory relief and naming the Illi-
nois Office of the Comptroller (Comptroller) as defendant. The court dismissed the Union's ac-
tions, finding it failed to exhaust administrative remedies before the Illinois Labor Relations
Board (Board). We affirm.
¶2 I. BACKGROUND
¶3 On April 4, 2013, the Union and the Comptroller entered into two collective-
bargaining agreements (CBAs) which were each applicable to separate bargaining units. Each
bargaining unit included Comptroller employees who held the job-classification title of "Public
Service Administrator" (PSA). Both CBAs were effective retroactively from July 1, 2012, until
June 30, 2015.
¶4 On April 5, 2013, section 3(n) of the Illinois Public Labor Relations Act (Act) (5
ILCS 315/3(n) (West 2012)), which defines a "public employee" or "employee" for purposes of
the Act, was amended (see Pub. Act 97-1172, § 5 (eff. Apr. 5, 2013)). Relevant to this appeal,
the amendment added language to section 3(n) which excluded any "person who is a State em-
ployee under the jurisdiction of the *** Comptroller who holds the position of [PSA]" from the
definition of "public employee" or "employee." 5 ILCS 315/3(n) (West 2012). The Comptroller
interpreted the amendatory language of section 3(n) to mean that PSAs it employed were exclud-
ed from collective bargaining as of April 5, 2013, and, therefore, also excluded as of that date
from the two bargaining units governed by the CBAs entered into between the parties on April 4,
2013.
¶5 Conversely, the Union took the position that the statutory amendment was not ap-
plicable to the parties' existing contracts and would not affect any bargaining-unit employees un-
til after June 30, 2015, the expiration of the parties' CBAs. On April 26, 2013, it served two
grievances on the Comptroller (one for each bargaining unit), alleging the Comptroller's action
"to unilaterally remove the [PSA] classification from both of the bargaining units" at issue vio-
lated the parties' CBAs. On May 9, 2013, the Comptroller responded to the Union, stating it re-
fused to recognize the Union's grievances as valid. It asserted as follows:
"[A]s of April 5, 2013, [PSAs] in the employ of the [Comptroller]
no longer enjoyed the rights connected to collective and concerted
activities, including the right to grieve.
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Because [PSAs] are no longer members of the bargaining
unit, they are no longer represented by [the Union]. Therefore,
[the Union's legal counsel does] not have the capability *** to file
a grievance with regard to these nonmembers of the bargaining
unit."
On May 13, 2013, the Comptroller filed a unit-clarification petition with the Board, seeking to
have it clarify that PSAs under the jurisdiction of the Comptroller were excluded from collective
bargaining and the bargaining units at issue as of the effective date of the amendment, April 5,
2013.
¶6 On May 29, 2013, the Union filed petitions in the circuit court (case Nos. 13-MR-
397 and 13-MR-398) "to compel processing of grievance and to compel arbitration." It argued
the amendment to section 3(n) of the Act was not applicable to the parties' CBAs, which predat-
ed the amendment. The Union maintained its grievances should have been processed pursuant to
the grievance/arbitration procedure set forth in the CBAs and the Comptroller's refusal to follow
such a procedure constituted both a breach of the parties' agreements and an unfair labor practice.
It requested the court issue an order compelling the Comptroller to process its grievances and
submit to the arbitration process set forth in the CBAs.
¶7 On July 8, 2013, the Comptroller filed motions to dismiss the Union's petitions,
citing section 2-615 of the Code of Civil Procedure (Civil Code) (735 ILCS 5/2-615 (West
2012)). It noted it had filed a unit-clarification petition with the Board, which it asserted was the
preferred method for addressing the parties' conflict. Additionally, the Comptroller asserted the
parties' dispute was "not one within the authority of an arbitrat[or] to resolve because *** the
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dispute is one of statutory interpretation, not contract interpretation."
¶8 On September 30, 2013, the circuit court conducted a hearing on the Comptrol-
ler's motions to dismiss. The record does not contain a transcript of that hearing; however, the
court's docket entry states: "Arguments heard. Motion to dismiss is allowed with leave to refile
within 7 days. Cause set for hearing on merits ***."
¶9 The same day its original petitions were dismissed, the Union filed petitions in
both cases "for declaratory judgment, to compel processing of grievance and to compel arbitra-
tion." It raised similar contentions as in its initial filings but additionally requested that, in con-
junction with its request to compel the processing of its grievances and arbitration, the circuit
court issue a declaratory judgment "as to the effective and applicability date of the statutory
amendment at issue." The Union sought to have the court declare "that because the Illinois Leg-
islature failed to articulate a temporal applicability date for exclusion—from the definition of
'public employee' under the [Act]—of the [PSA] position *** that said statutory amendment is
only prospectively applicable and does not affect the [CBAs] in effect at the time of the enact-
ment of the Public Act [which amended the statute]."
¶ 10 On October 21, 2013, the Comptroller filed briefs in each case "pursuant to court
order of September 30, 2013," addressing the Union's September 30 filings. It argued the statu-
tory amendment at issue was "effective to remove positions from the bargaining unit[s] on the
date it became law" and asserted the circuit court should dismiss the Union's petitions for failure
to exhaust administrative remedies or, in the alternative, stay the actions pursuant to the doctrine
of primary jurisdiction.
¶ 11 On October 24, 2013, the Union filed a response to the Comptroller's brief. With
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respect to the Comptroller's exhaustion argument, the Union maintained its actions presented a
purely legal issue that was appropriately before the circuit court. Additionally, it argued the
Board lacked jurisdiction to consider the issue through unit-clarification procedures.
¶ 12 On October 25, 2013, the circuit court conducted a hearing, the purpose of which
is unclear. There were no pending motions to dismiss directed toward the Union's amended peti-
tions. The record does not contain a transcript of that hearing but the court's docket entry shows
arguments were heard and the matter taken under advisement. Although the court's docket entry
for September 30, 2013, indicated the case was "set for hearing on merits," it appears that the
parties and the court proceeded on October 25, 2013, as if it was a dismissal hearing. On No-
vember 7, 2013, the court entered its order dismissing the Union's petitions "without prejudice to
the right of the parties to seek administrative review after exhaustion of administrative reme-
dies," which the court determined the Union had not done.
¶ 13 On November 21, 2013, the Union filed "motion[s] for rehearing, reconsideration
and modification/vacation of order" in each case. On December 6, 2013, the circuit court denied
the Union's motions. Its docket entry provides as follows:
"The Court stands by its previous rulings in this matter. The court
finds the *** Board has jurisdiction over this matter. The court
has previously found that [the Union] has not exhausted its admin-
istrative remedies and must proceed with this action in front of the
*** Board."
¶ 14 The Union filed notices of appeal in both cases. Its appeals were consolidated on
review.
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¶ 15 In its brief, the Comptroller notes that, while proceedings were pending in the cir-
cuit court, proceedings before the Board on the Comptroller's unit-clarification petition contin-
ued. Although not part of the underlying record, we may take judicial notice of the Board's deci-
sion. City of Chicago v. Illinois Labor Relations Board, Local Panel, 392 Ill. App. 3d 1080,
1083, 913 N.E.2d 12, 15 (2009) (stating a reviewing court could take judicial notice of a Board
order although the order was not contained in the appellate record).
¶ 16 On April 8, 2014, the Board issued its decision and order in the matter. Illinois
Office of the Comptroller & International Union of Operating Engineers Local No. 965, 30 PERI
¶ 282 (ILRB State Panel 2014). Ultimately, it agreed with the Comptroller's position, finding the
unit-clarification petition was "appropriate" and "PSAs should be excluded from existing bar-
gaining units, *** as they are no longer public employees under the Act." Office of the Comp-
troller, 30 PERI ¶ 282 (ILRB State Panel 2014). The Union appealed the Board's decision and
its appeal is currently pending before this court (case No. 4-14-0352).
¶ 17 II. ANALYSIS
¶ 18 On appeal, the Union argues the circuit court erred by refusing to rule on its peti-
tions for declaratory judgment. It maintains it was not required to exhaust administrative reme-
dies prior to seeking relief in the circuit court and contends the parties' conflict involved a purely
legal issue that did not require any administrative expertise or insight. The Union also argues it
was exempt from exhaustion requirements because the Board lacked administrative jurisdiction
over the parties' dispute.
¶ 19 A proceeding for declaratory judgment "may be employed alone or in combina-
tion with other remedies to determine questions as to the construction or interpretation of statutes
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and is an appropriate method for determining controversies relating to such construction." Office
of the Lake County State's Attorney v. Illinois Human Rights Comm'n, 200 Ill. App. 3d 151, 155,
558 N.E.2d 668, 671 (1990). Pursuant to section 2-701 of the Civil Code (commonly known as
the Declaratory Judgment Act) (735 ILCS 5/2-701(a) (West 2012)), a "court may, in cases of ac-
tual controversy, make binding declarations of rights." (Emphasis added.) "[T]he appropriate-
ness of the [Declaratory Judgment] Act as a vehicle for relief is a question for the trial court's
discretion, and *** review is deferential." In re Marriage of Rife, 376 Ill. App. 3d 1050, 1059,
878 N.E.2d 775, 784 (2007).
¶ 20 "The exhaustion doctrine applies where a claim is cognizable in the first instance
by an administrative agency." Beahringer v. Page, 204 Ill. 2d 363, 375, 789 N.E.2d 1216, 1224
(2003). When the legislature vests an agency with the authority to administer a statute, declara-
tory relief is unavailable and "judicial interference must be withheld until the administrative pro-
cess has run its course." Beahringer, 204 Ill. 2d at 375, 789 N.E.2d at 1224. "The reasons for
the exhaustion requirement are to allow the administrative agency to fully develop and consider
the facts of the case before it, to allow the agency to utilize its expertise, and to allow the ag-
grieved party to obtain relief from the agency, thus making judicial review unnecessary." Canel
v. Topinka, 212 Ill. 2d 311, 320-21, 818 N.E.2d 311, 319 (2004).
¶ 21 Although strict compliance with the exhaustion doctrine is generally required, the
supreme court has recognized six exceptions to the doctrine. Castaneda v. Illinois Human Rights
Comm'n, 132 Ill. 2d 304, 308, 547 N.E.2d 437, 439 (1989). The court has held that a party may
be excused from complying with the exhaustion doctrine where (1) "a statute, ordinance or rule
is attacked as unconstitutional on its face"; (2) "multiple administrative remedies exist and at
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least one is exhausted"; (3) "the agency cannot provide an adequate remedy or *** it is patently
futile to seek relief before the agency"; (4) "no issues of fact are presented or agency expertise is
not involved"; (5) "irreparable harm will result from further pursuit of administrative remedies";
or (6) "the agency's jurisdiction is attacked because it is not authorized by statute." (Emphases
added.) Castaneda, 132 Ill. 2d at 309, 547 N.E.2d at 439.
¶ 22 In Coles-Moultrie Electric Cooperative v. City of Charleston, 8 Ill. App. 3d 441,
444, 289 N.E.2d 491, 493 (1972), this court affirmed the trial court's dismissal of a declaratory
judgment action where administrative proceedings were also pending. We noted the Declaratory
Judgment Act contains permissive language which gives the trial court "discretion in deciding
whether to enter a declaratory judgment in the particular case." Coles-Moultrie, 8 Ill. App. 3d at
444, 289 N.E.2d at 493. Further, we held that " ' [o]ne way of exercising this discretion is to
dismiss the complaint if it appears from the face of the complaint that there has accrued another
existing and well-recognized form of action.' [Citations.]" Coles-Moultrie, 8 Ill. App. 3d at 444,
289 N.E.2d at 493. Ultimately, we found the trial court's refusal to grant declaratory relief was
appropriate, noting "[t]he issues sought to be determined in the action for declaratory judgment
*** were pending before the Illinois Commerce Commission" and finding no abuse of the trial
court's discretion. Coles-Moultrie, 8 Ill. App. 3d at 444, 289 N.E.2d at 493. In the instant case,
we also find the trial court committed no abuse of its discretion by dismissing the Union's peti-
tions for declaratory relief.
¶ 23 Under the Act, either "[a] labor organization or an employer may file a
unit[-]clarification petition seeking to clarify an existing bargaining unit." 5 ILCS 315/9(a-6)
(West 2012). The Board's rules then provide as follows with respect to unit-clarification proce-
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dures:
"An exclusive representative or an employer may file a
unit[-]clarification petition to clarify or amend an existing bargain-
ing unit when:
1) substantial changes occur in the duties
and functions of an existing title, raising an issue as
to the title's unit placement;
2) an existing job title that is logically en-
compassed within the existing unit was inadvertent-
ly excluded by the parties at the time the unit was
established; and
3) a significant change takes place in statu-
tory or case law that affects the bargaining rights of
employees." (Emphasis added.) 80 Ill. Adm. Code
1210.170(a) (2003).
¶ 24 The purpose of unit-clarification procedures "is to provide an official determina-
tion of a bargaining unit's composition." State of Illinois v. State of Illinois, 364 Ill. App. 3d
1028, 1032, 848 N.E.2d 118, 121 (2006). Further, "the unit-clarification process is appropriate
'to remove statutorily excluded employees from a bargaining unit.' " State of Illinois, 364 Ill.
App. 3d at 1034, 848 N.E.2d at 123 (quoting SEDOL Teachers Union v. Illinois Educational La-
bor Relations Board, 276 Ill. App. 3d 872, 879, 658 N.E.2d 1364, 1368 (1995)).
¶ 25 The Comptroller maintains the unit-clarification procedure provided for in the Act
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was the proper method for resolving the parties' underlying dispute, i.e., whether the amendment
to section 3(n) of the Act excluded Comptroller PSAs from existing CBAs as of the effective
date of the amendment. Specifically, it argues the amendment at issue represented a "significant
change *** in statutory or case law that affects the bargaining rights of employees" as set forth in
the Illinois Administrative Code (80 Ill. Adm. Code 1210.170(a)(3) (2003)) and, therefore, pro-
vided a sufficient basis for the Comptroller's unit-clarification petition.
¶ 26 The Union argues, however, that unit-clarification procedures are not appropriate
in this instance because the amendment to section 3(n) is not a significant change to statutory law
that currently "affects" the rights of bargaining-unit employees and will not affect their rights
until after the expiration of the parties' CBAs. Therefore, it contends the parties' dispute did not
fall within any permissible grounds for seeking unit clarification and the Board lacked jurisdic-
tion over the underlying dispute. Further, the Union maintains that, because it has raised a chal-
lenge to the Board's administrative jurisdiction, it is exempt from the general requirement that it
must exhaust administrative remedies.
¶ 27 First, we disagree with the Union's position that unit-clarification procedures were
not proper under the circumstances. In particular, we find that the amendment to section 3(n)
constituted "a significant change *** in statutory *** law that affects the bargaining rights of
employees." 80 Ill. Adm. Code 1210.170(a)(3) (2003). The Union does not dispute that the
amendment at issue constituted a significant change in statutory law. Further, the added statuto-
ry language clearly has an effect on employee-bargaining rights as it excludes certain job classi-
fications from the Act's definition of "public employee" or "employee." Contrary to the Union's
position, the fact that the amendment may not immediately affect the bargaining rights of em-
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ployees is not determinative of the appropriateness of a unit-clarification proceeding because nei-
ther the Act nor the Board's rules set forth such a requirement. The Union is simply reading an
extra requirement into the Board's rules that does not exist.
¶ 28 Second, we also disagree with the Union's position that its argument with respect
to the appropriateness of unit-clarification proceedings constituted an attack on the Board's juris-
diction which fell within an exception to the exhaustion doctrine. To support its position, the
Union cites Landfill, Inc. v. Pollution Control Board, 74 Ill. 2d 541, 551, 387 N.E.2d 258, 261
(1978), wherein the supreme court held that "where an administrative body's assertion of juris-
diction is attacked on its face and in its entirety on the ground that it is not authorized by statute,
exhaustion of administrative remedies and compliance with the Administrative Review Act is not
required." (Emphasis added.)
¶ 29 Here, the Union does not challenge the Board's administrative authority "on its
face" as unauthorized. A successful facial challenge would require that there be no set of cir-
cumstances under which the challenged assertion of administrative authority would be valid. See
Hope Clinic for Women, Ltd. v. Flores, 2013 IL 112673, ¶ 33, 991 N.E.2d 745 (stating "[a] facial
challenge to a legislative act is the most difficult challenge to mount successfully because the
challenger must establish that under no circumstances would the challenged act be valid"). In
this instance, the Union argues administrative action, i.e., a unit-clarification proceeding, would
be inappropriate based upon the specific circumstances presented in this case. It does not chal-
lenge such administrative action in every circumstance. Thus, we find the jurisdictional chal-
lenge raised by the Union does not fall within the specific exception to the exhaustion doctrine
set forth in Landfill.
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¶ 30 On appeal, the Union also argues it was exempt from exhaustion requirements
because the underlying issue involves only matters of law and requires no agency expertise. See
Castaneda, 132 Ill. 2d at 309, 547 N.E.2d at 439 (providing an exception to the exhaustion doc-
trine applies when "no issues of fact are presented or agency expertise is not involved"). Alt-
hough we agree that the underlying issue concerns a matter of statutory construction and does
not necessarily involve the Board's expertise, we nevertheless find no abuse of discretion in the
court's dismissal of the Union's declaratory judgment actions.
¶ 31 The record shows the Comptroller's unit-clarification petition was pending prior
to the Union's filing of its actions in the circuit court. As discussed, we find unit-clarification
proceedings were appropriate to address the underlying issue. Pursuant to this court's holding in
Coles-Moultrie, we find the trial court had discretion to determine whether a request for a declar-
atory judgment was the appropriate vehicle for the Union's requested relief. Here, we find no
abuse of discretion by the trial court in dismissing the Union's actions. Additionally, we note the
court's dismissal does not deprive the Union of judicial review as judicial review is possible upon
the conclusion of administrative proceedings. (As noted by the Comptroller on appeal, unit-
clarification proceedings before the Board have concluded and review of the Board's final deci-
sion is currently pending before this court.)
¶ 32 III. CONCLUSION
¶ 33 For the reasons stated, we affirm the circuit court's judgment.
¶ 34 Affirmed.
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