Forest Clark v. State of Illinois

The Claimant in this case, Forest Clark, was employed by the State of Illinois and the Department of Law Enforcement since 1953 as an Illinois State trooper.

On November 21, 1978, Claimant was suspended from all police duties and from active pay status at the close of the business day. A hearing occurred concerning the suspension, and on April 23, 1980, the State of Illinois, through the Department of Law Enforcement Merit Board, ordered Claimant permanently removed [*214]

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and discharged from his position as an Illinois State trooper. Claimant then filed a petition in the Sixth Judicial Circuit Court of Champaign County, Illinois, for a review of this permanent discharge. On February 6, 1981, the circuit court entered an order reversing this decision and remanding the case to the Merit Board for the imposition of a lesser sanction.

On March 13, 1981, the Merit Board suspended Claimant from duty without pay or benefits for 180 calendar days, and on March 30; 1981, Claimant was reinstated and returned to active duty and pay status as a State trooper.

At the evidentiary hearing held on March 1, 1984, it was stipulated by the parties that if the Claimant had worked from November 21,1978, until May 30,1981, he would have been entitled to $44,620.56. On May 13, 1985, Claimant and Respondent filed a written stipulation that Claimant would have been entitled to $55,780.38 minus $11,157.82, representing the pay attributable to the six-month suspension period, leaving a balance of $44,622.56. We accept the figure of $44,622.56.

Respondent urges that Claimant failed to mitigate his damages. We reject that contention. I Prior to his termination as an Illinois State trooper and while gainfully employed by the State of Illinois, the Claimant operated two small businesses, both of which showed a net loss for calendar year 1978, as well as calendar years 1979 and 1980, during which years, and while Claimant was under suspension, the Claimant testified that he devoted full time to the businesses. The income tax returns for the calendar years 1978 through 1981, which were made part of the record, revealed [*215] some improvement in the operation of the businesses, although the loss of one of the businesses was greater than the profit of the other, thereby resulting in a net loss for each of the years.

The Claimant testified that he was in such dire financial straits that he applied for and received a loan from Troopers Lodge #41, Fraternal Order of Police, in the amount of $19,999.00. To secure the loan the Claimant executed an assignment to the Troopers Lodge #41, Fraternal Order of Police, of all right, title and interest in and to the first $20,000 in back salary due him by the Illinois Department of Law Enforcement in the event of his reinstatement to duty.

The Claimant testified that he made no applications for employment for the reason that he was familiar with the area and believed that the unemployment rate was extremely high, and therefore no employment was available to him. He testified that he talked to many different people requesting work without success.

The question before the Court is whether the Claimant acted reasonably to mitigate his damages during the period that he was wrongfully suspended.

The testimony of the Claimant that he worked full time in his two business ventures during the period of suspension is borne out by an inspection of the Claimant’s income tax returns which show a much greater volume of business, although the net result still showed a loss for those years. It is the opinion of the I Court that the Claimant acted reasonably under the circumstances in attempting to mitigate his losses during the period of his non-employment by the Department of Law Enforcement.

It is therefore a simple matter of computation to [*216] determine what is due the Claimant by reason of the wrongful discharge and how the same should be distributed. The Claimant and the Respondent have agreed that the amount of salary which accrued during the entire period of suspension is the sum of $55,780.38.

The parties further agreed that from this amount should be deducted the earnings for the six months’ suspension, which amount is $11,157.82, leaving a balance of $44,622.56.

The remaining issue is the right of the intervening Claimant to the first $20,000.00 of our award.

We have previously. been presented with a similar issue in the case of Terminal Bank v . State (1943), 12 Ill.

Ct. C1. 491. In Terminal, a milk company which had provided supplies to the State assigned its right of payment from the State to a bank in consideration of various financial notes issued to the milk company. The Court of Claims stated: “The Claimant, (the bank) by its assignment, acquired rights equal to those of the assignor. The general rule is that claims against the government are assignable. (People 0. Nudelman (1941), 376 111. 535.) The right to assign a debt which is due and fully earned is unquestioned by the courts. The assignment, by the Illinois Milk Products Company of its accounts against the Respondent, was a valid assignment of which the State was required to take notice.”

Claimant contends that the intervening Claimant has no right to a direct award since the assignment “was an assignment of the proceeds, not the cause of action.”

The contention is not well taken, in that a simple reading of the assignment itself, a copy of which was admitted into evidence, clearly shows a complete and unrestricted assignment of the first $20,000 of back salary which may be determined to be due the Claimant. The assignment further provides that Claimant will “faithfully and diligently initiate, prosecute and pursue . . . in the [*217] Illinois Court of Claims his suit and claim for all back salary against the Illinois Department of Law Enforcement” and that intervening Claimant has a “first and exclusive lien” on the proceeds. The intent of the parties is clear.

It is therefore ordered that Claimant Forest Clark is awarded $44,622.56 in full and complete satisfaction of this claim and that said funds be paid as follows: Troopers Lodge #41, Fraternal Order of Police

Intervening Claimant . $20,000.00

Forest Clark, Claimant $24,622.56

APPENDIX A

Identification of the State Contributions and Deductions from Back Salary Award To the State Employees’ Retirement System Employee’s contribution to

State Employees’ Retirement System 5299.14

Employee’s contribution to FICA -00 Employer’s contribution to

State Employees’ Retirement System 4281.19

Employer’s contribution to FICA .oo To Illinois State Treasurer to be,remitted to Internal Revenue Service:

Claimant’s Federal Income Tax 8924.51

To Illinois Department:

Claimant’s Illinois Income Tax 1115.56

[*218] To the Claimant: Net salary 9283.35

Total Award $48903.75

Troopers Lodge #41, Fraternal Order of Police’ $20,000.oo (N O . 83-CC-1916-Claim denied.)

COMMUNITY AC~IONAGENCYFOR MCHENRYCOUNTY, Claimant, o. THE STATE OF ILLINOIS, Respondent.

Opinion filed March 28,1986.

WEISZ& WEISZ, for Claimant.

NEIL F. HARTIGAN, Attorney General (LYNN SCHOCK, Assistant Attorney General, of counsel), for Respondent.

CONTRACTS-food service for migrant workers-vouchers-noncompliance with contract- claim denied. Claim for reimbursement for expenditures made by Claimant under contract with State to provide food service to migrant workers was denied as evidence established that Claimant waived right to payment by failing to submit vouchers within 60 days of completion of the contract as required by provision of the contract.

SAME-hte payment by State-penalties and interest-delay caused by Claimant-claim denied. Claim’ for reimbursement for penalty costs and interest on late F.I.C.A. payments made by Claimant allegedly caused by State’s failure to make timely payments to Claimant was denied as evidence established that delay was due to Claimant’s submission of ineligible claims and State is not liable for Claimant’s failure to pay its own bills.

SAME-reimbursernent for unemployment compensation-vouchersnoncompliance with contract-claim denied. Claim for reimbursement for payment of unemployment compensation in connection with migrant workers’ program which was mistakenly paid from funds for another program was denied as Claimant waived right to reimbursement by failing to submit voucher within 60 days of completion of contract as required by provision of contract.

[*219] MONTANA, C.J.

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This is a three-count claim for reimbursement to Claimant for expenditures allegedly made by Claimant I pursuant to a contract entered into by the parties wherein Claimant was to provide food services to migrant workers.

Both Claimant and Respondent filed cross-motions for summary judgment. At oral argument on those motions before the commissioner there was conceded

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that there are no contested issues of fact. , As to Count I, the facts are that in 1981 Respondent I had been unsuccessful for two years in opening a Lake 1 County migrant service center. In March or April of 1981 Respondent requested Claimant to open such a center in l Lake County by the end of June 1981.

A licensable location was obtained for opening in June, but this location had no acceptable kitchen facilities, thus necessitating the hiring of a catering service. Respondent, through its representative, told Claimant that Quality Catering was the only catering service in the area that met licensing standards. Based on verbal approval by Respondent, Claimant contracted with Quality Catering without competitive bidding as required for such contracts.

By practice and custom, Claimant first requested reimbursement of the contested expenses of Quality Catering amounting to $5,996.00 from the Federal program involved, namely, the Federal Child Care Food Program, During the last week of April 1982, Claimant was notified by the Federal agency that the requested amount would not be reimbursed. Immediately thereafter, on May 5, 1982, Claimant submitted [*220] 220 \

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vouchers to Respondent. These vouchers were delivered to Respondent 68 days after the termination or completion of the contract.

The contract provided, in pertinent part that: “No vouchers shall be honored and paid and the Agency waivers all rights to payment if submitted later than 60 days after the end of the fiscal year or, if submitted more than 60 days following the termination or completion of the contract.”

Thus, Respondent argues, Respondent is not liable because there was no competitive bidding and because the vouchers were submitted more than 60 days following the termination or completion of the contract.

Claimant argues that since Claimant received verbal approval of the noncompetitively-bid contract, verbal approval was sufficient, and further, that the delay in submitting vouchers was not due to its own fault but was induced by late notification by the Federal program that the expenses were not to be approved by them.

In the opinion of this Court, it is not necessary for us to decide whether payment should or should not be denied because the reimbursement claimed was based on a noncompetitively-bid contract, because Respondent’s second defense is sufficient.

This Court is powerless to change the terms of the contract between the parties. The contract plainly requires submission of vouchers within 60 days of the completion of the contract. Vouchers were not submitted within that period of time. Claimant’s reason for not following the contractual payment procedure is wholly insufficient, for the record shows nothing to have prevented Claimant from submitting vouchers to Respondent while waiting for a response from the Federal program.

[*221] Thus, because of the violation of the unambiguous

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terms of the contract, the Claimant waived the claims enumerated in Count I and the claim in Count I is I

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denied.

As to Count 11, Claimant’s claim is for reimbursement for interest and penalty costs incurred by Claimant I

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on late F.I.C.A. payments incurred by Claimant as a result of Respondent’s failure to make timely scheduled payments to Claimant.

The facts were that claims were made for reimbursement of expenses for July, August and September of 1981, which included claims for persons who were not eligible under the program. Because of questioned eligibility, the claims for those months were not processed until eligibility verification documentation was received by the Department. An audit was completed in December 1981 on eligibility documents and a total of $8,630.95 was disallowed and deducted from the claims, leaving $5,644.00 due to Claimant, which amount was paid in January and February 1982.

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Claimant argues that Respondent’s failure to immediately recognize the eligibility of those persons who were eligible, and immediately pay the $5,644.00, caused the Claimant to incur interest and penalty costs on F.I.C.A. payments.

In the opinion of this Court, the delay in payment was because Claimant submitted ineligible claims and thus the delay in payment was solely Claimant’s fault.

In addition, Claimant’s failure to pay its F.I.C.A. payments has not been shown to have been the result of Respondent’s delay in payment. Thus, assuming arguendo that Respondent caused a delay in payment, it does not follow that the Respondent is liable for all costs [*222]

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incurred by Claimant by its own failure to pay its own bills. This failure to pay its own bills is a result of its own policy considerations and not because of any fault on the part of Respondent. Count I1 is also denied.

As to Count 111, the Claimant claims that in October and November 1982 it mistakenly paid fringe benefits in the amount of $3,126.00 in the form of unemployment compensation from another of its funds, namely the Head Start Program funds, which payment was for the use of the migrant workers program. Claimant did not discover this mistake until an audit was made of the Head Start Program. Claimant, therefore, seeks reimbursement under the migrant workers contract for unemployment compensation money expended by it but for which it has never formally requested reimbursement under the contract between the parties.

Once again, the provisions of the contract, which require submission of vouchers within 60 days of the completion or termination of the contract, applies. The claim in Count I11 is one in which vouchers were never timely submitted. In fact, it was admitted during oral argument before the commissioner that vouchers have not yet been submitted. This count, being contractually stale, is denied.

Accordingly, it is hereby ordered that this entire claim be, and hereby is, denied.