The Supreme Court of Illinois recently held that an effective tender made prior to a class certification motion which satisfies the named plaintiff's individual claim, moots her interest in the litigation, and ends the matter.
In so ruling, the Court explained that the ruling of the Supreme Court of the United States in Campbell-Ewald Co. v. Gomez, 577 U.S. ___, 136 S. Ct. 663 (2016), dealt with offers of judgment, but here there was a complete tender of the amounts claimed.
A copy of the opinion is available at: Link to Opinion
Two tenants brought two putative class action claims and individual claims in state court against their prior landlord. The tenants did not file a class certification motion with their complaint.
Count I of the tenants' complaint prayed for judgment in an amount to be proven at trial but not less than an amount equal to such class member's security deposit, plus costs, attorney fees.
The day after the landlord was served with the complaint, its attorney sent tenants' counsel a letter indicating that he had been retained by the landlord "to tender a full, unconditional, and complete settlement of [plaintiffs'] individual claim set forth in Count I of the proposed class action complaint" along with a cashier's check of $1,290.00, representing tenants maximum individual recovery as prayed for in Count I of the complaint.
The tenants did not deposit or cash the check.
The landlord then moved to dismiss count I pursuant to Barber v. American Airlines, Inc., 241 Ill. 2d 450 (2011), arguing that it "made a full and unconditional tender of all sums due to Plaintiffs" and move two dismiss count II for failure to state a claim. The motion did not address count III.
Tenants responded Barber was no longer valid law following Campbell-Ewald, and even if it were valid, that the landlord's tender was insufficient and moved to amend count II. Tenants amended count II but failed to attach any exhibits to its amended complaint.
The trial court dismissed count I, finding that it was bound by precedent in Barber and that the landlord made an adequate tender.
The landlord moved to dismiss the amended complaint generally and count II specifically. The trial court dismissed the first amended complaint as deficient for lacking the written instruments on which the claims were founded and dismissed count II for failure to state a claim.
The tenants appealed. The appellate court help that the landlord made a valid tender and the trial court "properly dismissed Count I as moot." As for count II, the appellate court noted that plaintiffs did not argue for reversal of the failure to state a claim, and affirmed dismissal and reinstated count III as the third count was not based on a written instrument.
The tenants then appealed to the Supreme Court of Illinois raising two issues (1) that Barber is no longer good law after Campbell-Ewald; and (2) that the trial court erred in dismissing all counts based on defendant's tender as to only the first count.
The Supreme Court of Illinois noted that the Barber rule holds that "when a defendant tenders the full amount requested by a plaintiff purporting to represent a class before the named plaintiff files a class-certification motion, the plaintiff's claim becomes moot." Barber, 241 Ill. 2d at 456-57.
The Court examined Wheatley, which held that when the named plaintiffs received the relief they demanded it was "clear that the interests of the named representative plaintiffs are moot because there is no longer a controversy between them and the [Defendant]." Wheatley v. Board of Education of Township High School District 205, 99 Ill. 2d 481, 485-86 (1984).
When the Supreme Court of Illinois considered a similar situation in Barber, the Court noted that "Wheatley teaches that the important consideration in determining whether a named representative's claim is moot is whether that representative filed a motion for class certification prior to the time when the defendant made its tender."
Finally, the Court examined Ballard which held "that Barber contains no explicit requirement for the class certification motion, other than the timing of its filing" and "the focus of Barber is on the timing of the plaintiff's filing [and not the merits of] a motion for class certification". Ballard RN Center, Inc. v. Kohll's Pharmacy & Homecare, Inc., 2015 IL 118644.
The Supreme Court of Illinois noted the difference between an offer (a willingness to do something) and a tender which "is an unconditional offer of payment consisting of the actual production of a sum not less than the amount due on a particular obligation."
The Court noted that, in Campbell-Ewald, the Supreme Court of the United States that a plaintiff's "individual claim was not made moot by the expired settlement offer," and "a would-be class representative with a live claim of her own must be accorded a fair opportunity to show that certification is warranted."
However, here, the Court noted the defendant "unconditionally tender[ed]" a "[c]ashier's check in the amount of $1,290.00 representing [plaintiffs'] maximum individual recovery under 765 ILCS 715/2 as prayed for in Count I of the complaint" and "[a]ll court costs and reasonable attorney's fees as allowed by the court that Plaintiffs incurred in pursuing Count I of the complaint."
The Supreme Court of Illinois rejected Plaintiffs argument that tender was conditional because it limited recovery on costs and attorney fees to what would be "allowed by the court" and did not include payment for the costs and attorney fees.
The Court reaffirmed Wheatley, Barber, and Ballard and held that an effective tender made before a named plaintiff purporting to represent a class files a class certification motion satisfies the named plaintiff's individual claim and moots her interest in the litigation.
Ralph T. Wutscher
Maurice Wutscher LLP
The Loop Center Building
105 W. Madison Street, 18th Floor
Chicago, Illinois 60602
Direct: (312) 551-9320
Fax: (312) 284-4751
Mobile: (312) 493-0874
Email: rwutscher@MauriceWutscher.com
Admitted to practice law in Illinois
Alabama | California | Florida | Georgia | Illinois | Massachusetts | New Jersey | New York | Ohio | Pennsylvania | Texas | Washington, DC
NOTICE: We do not send unsolicited emails. If you received this email in error, or if you wish to be removed from our update distribution list, please simply reply to this email and state your intention. Thank you.
Our updates and webinar presentations are available on the internet, in searchable format, at:
Financial Services Law Updates
and
The Consumer Financial Services Blog™
and
and
California Finance Law Developments
