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Judicial Rulings

Exhaustion of remedies clarified for agency orders

Appellate court decisions have conflicted on exhaustion of remedies in appeals from decisions of administrative agencies. The Illinois Supreme Court's decision of November 22 addressed the issue.

In the present case an employee had complained to the Illinois Department of Human Rights of discrimination in termination of his employment. After investigation an administrative law judge recommended dismissal, and a three-member panel of the Human Rights Commission adopted this recommendation. An appellate court dismissed the plaintiff's request for review on the grounds that he had not exhausted all administrative remedies because he did not request hearing by the full nine-member commission.

The Illinois Human Rights Act says, "Any complainant or respondent may apply for and obtain judicial review of a final order of the Commission entered under this Act by filing a petition for review in the Appellate Court . . ." (see Illinois Revised Statutes 1987, ch. 68, sec. 8-111(A)(1)). The plaintiff viewed the commission's order, based on the finding of the three-member panel, as final.

At issue is interpretation of language in the Administrative Review Law (see Ill. Rev. Stat. 1987, ch. 110, sec. 3-101): "In all cases in which a statute or rule of the administrative agency requires or permits an application for a rehearing or other method of administrative review to be filed within a specified time . . . and an application for such hearing is made, no administrative decision of such agency shall be final as to the party applying therefor until such hearing or review is had or denied." The appellate court cited a provision of the Human Rights Act that says, "Within 30 days of the Commission's order, a party may file an application for rehearing before the full Commission" (see sec. 8-107(F)(1)). It rejected the plaintiff's contention that the words "may file an application" are permissive and that his failure to do so made final the order issued on the panel's recommendation. In similar cases several appellate decisions have agreed, but others have not, and the high court noted "a genuine conflict between various appellate court opinions in this area . . . ."

The decision reviewed points in the various appellate decisions, exceptions to the principle of exhaustion of remedies and the apparent legislative intent of the entire act. It concluded that the purpose of the act is to allow the full commission to apply its expertise and possibly to dispose of cases that otherwise might clog jammed court dockets. It interpreted the act "as meaning aggrieved parties 'may' apply for a rehearing if they wish to pursue further review. ... If they choose to continue further, they must apply for a rehearing. Otherwise, they 'may' decide not to continue the administrative review process."

The court made the ruling retrospective and overruled all cases cited in the opinion that are inconsistent. The decision in Castaneda v Human Rights Commission (132 Ill. 2d, 304) was unanimous, with an opinion by Justice John J. Stamos.

ComEd rate agreement nixed

Commonwealth Edison called it a "no-lose'' agreement for consumers, but the Illinois Supreme Court rejected the rate agreement worked out between the utility and the Illinois Commerce Commission (IICC). The decision, filed December 21, said that the agreement violated the Public Utilities Act (see Ill. Rev. Stat. 1987, ch. 111 2/3, sec. 1-101 et. seq.).

In 1987 ComEd sought a rate increase to help recover $7.1 billion costs for new nuclear power plants being phased into operation. Seven groups representing consumers, the city of Chicago, Cook County and state agencies, opposed the increase and appealed the IICC's sixth interim order that attempted to reach settlement of the matter.

Central to the court's finding in a very complex case were provisions for a two-step rate increase in 1989 and 1990, followed by a three-year moratorium on additional increases. This was necessary because several new units were being phased into operation and the IICC felt that it could not determine their value and level of service until they became fully operative.

Throughout the order the IICC characterized it as a traditional rate determination, which would be a one-time establishment of a utility rate, based on the evidence in the record, with nothing to prevent the utility from seeking subsequent rate changes. The court pointed out that the order actually was a settlement. Since it prevented further requests for rate increases and provided for unilateral imposition of retroactive refunds, it could not be imposed without the utility's consent. It did not include consent of the intervenors, and it included provision for further adjustment since the evidence in the record was not complete.

The court said, "Edison believes the novel provisions in the Sixth Order . . . put ratepayers in a 'no-lose' situation. This argument by Edison is irrelevant. . . . [T]he Commission may not enter into a settlement with a utility which excludes the intervenors in the case, and it may not enter an order not based on the evidence.'' It provided for hearings during 1989 on possible rate increases if the second phase increase proved inadequate, but would only have allowed intervenors to argue against a further increase and not to present evidence for a rate reduction.

The court's findings were so sweeping that it said, "Therefore, upon remand, the Commission will have to reconsider the entire rate decision.'' The imediate effect upon utility bills is not yet clear.

Justice Horace L. Calvo wrote the opinion in Business and Professional People for the Public Interest v Commerce Commission (Docket Nos. 68100, 68246, 68247, 68306, 68355 cons.).

Miranda warning in second crime

Waiver of Miranda warnings about a crime apply to statements volunteered about a second crime, according to the Illinois Supreme Court. It filed its decision December 21 in a case that might reasonably reach the U.S. Supreme Court.

A suspect's fingerprints were found on a safe removed during a burglary. After a deputy told him that he would only be questioned about that incident and issued the Miranda warning, the suspect invoked his right to have an attorney present. Because he was on parole, he was returned two days later to a correctional center. During the trip he initiated conversation about the crime. The deputy said that he could not discuss it because of the invocation of Miranda protections, but the suspect said that his prints were on the safe because the burglars had brought it to his house. The deputy jokingly mentioned another burglary, which the suspect admitted that he had done.

The court held that the voluntary statements constituted a waiver of fifth amendment right to counsel and said, "When counsel is requested the right to counsel... is not investigation specific. So also, when the right to counsel is waived, the waiver should not be investigation specific." It stated as a principle, "[F]ollowing a waiver of the right to counsel, the defendant may be interrogated as to any offense, unless he has indicated his waiver is a limited waiver."

Justice Howard C. Ryan wrote for the majority in People v Hicks (Docket No. 68380). Justices William G. Clark and John J. Stamos filed dissents, each joining in the other's, Clark cited U.S. Supreme Court decisions that establish a strong presumption in unclear cases in favor of invocation of a right to counsel and against waiver of the right. Stamos pointed out that the initial statement that questioning would be limited to the first crime deprived the suspect of any chance to invoke Miranda protections about the second. He pointed out fallacies in the majority application of cases cited as precedents.

F. Mark Siebert

22/February 1990/Illinois Issues

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