NOTICE: Under Supreme Court Rule 367 a party has 21 days after the filing of the opinion to
request a rehearing. Also, opinions are subject to modification, correction or withdrawal at
anytime prior to issuance of the mandate by the Clerk of the Court. Therefore, because the
following slip opinion is being made available prior to the Court's final action in this matter, it
cannot be considered the final decision of the Court. The official copy of the following opinion
will be published by the Supreme Court's Reporter of Decisions in the Official Reports advance
sheets following final action by the Court.
Docket No. 78181--Agenda 9--November 1995.
WENDELL WRIGHT et al., Appellees, v. THE CITY OF DANVILLE,
Appellant.
Opinion filed December 19, 1996.
JUSTICE NICKELS delivered the opinion of the court:
Plaintiffs, Ernie A. Cox, Jerome D. Brown, and Raymond T.
Randall, former commissioners of the City of Danville, Kevin
Scharlau, as executor of the estate of former commissioner Wilbur
Scharlau, and Wendell Wright, former corporation counsel, filed a
complaint seeking reimbursement from the city of attorney fees and
litigation expenses incurred in defending the criminal prosecution
of the commissioners and corporation counsel. The circuit court of
Vermilion County found that indemnity was not warranted and
dismissed the complaint under sections 2--615 and 2--619 of the
Code of Civil Procedure (735 ILCS 5/2--615, 2--619 (West 1994)).
The appellate court reversed, holding that genuine issues of
material fact existed which precluded judgment as a matter of law
for the city. 267 Ill. App. 3d 375. We granted the city's petition
for leave to appeal (155 Ill. 2d R. 315), and we reverse.
BACKGROUND
The present appeal arises out of attempts by plaintiffs to
recover attorney fees and litigation expenses incurred by the
former commissioners and corporation counsel in their defense of
criminal charges of official misconduct and conflict of interest.
The criminal prosecutions resulted from the manner in which the
group negotiated the settlement of a lawsuit filed against the
commissioners and the city.
In January 1987, a group of African-American residents of
Danville filed a lawsuit in federal district court against the city
and its commissioners alleging that the nonpartisan, at-large,
citywide process for electing commissioners excluded African-
American representation and diluted minority voting strength,
thereby violating the Voting Rights Act of 1965 (42 U.S.C. §1973b
(1982 & Supp. V 1987)). The commissioners and corporation counsel
negotiated a proposed settlement of the voting rights lawsuit which
would change the form of government from a mayor-commissioner
system to a mayor-alderman system with aldermen elected from seven
two-member districts. The settlement also provided that the present
commissioners would be appointed as administrators of the various
departments that corresponded with their current respective
commission duties. These newly created administrative positions
would be guaranteed for a minimum of three years at salaries the
commissioners would set themselves.
The Vermilion County State's Attorney, arguing that the
proposed settlement was a conflict of interest, issued subpoenas
for the commissioners and corporation counsel to appear before the
grand jury. The federal district court enjoined the grand jury
proceedings and added the State's Attorney to the proceedings
before it. Subsequently, the federal district court held hearings
on the proposed settlement. These hearings revealed that the
commissioners and the corporation counsel knew that they could not
prevail in the voting rights litigation. The commissioners
contended, however, that they needed to stay in office for a period
of time after the new aldermen were elected in order to ensure a
smooth transition into the new system of government. The federal
district court approved and entered the consent decree settling the
voting rights suit and dissolved the injunction against the State's
Attorney.
Less than two weeks later, the commissioners enacted a new
indemnity ordinance. The ordinance, suggested by the corporation
counsel, added indemnification for city appointees, which included
the positions of corporation counsel and the new department
administrators. In addition to civil indemnity, the ordinance
provided indemnity for criminal actions if the person seeking
indemnity had no reasonable cause to believe his conduct was
unlawful and the act or omission was within the scope of the office
or employment.
Soon thereafter, the State's Attorney reconvened the grand
jury. At the grand jury proceedings, the commissioners testified
that they would receive personal benefits under the federal consent
decree and that they would never have agreed to the settlement
without the retention provisions. In addition, the corporation
counsel testified that the group felt that they were being asked to
sacrifice their personal positions and that "if they were going to
give up something, they were entitled to something in return."
Subsequently, the grand jury returned an eight-count indictment
against the commissioners and corporation counsel charging official
misconduct and conflict of interest.
The federal district court again enjoined the state
prosecution on the grounds that it had previously resolved the
issue of the commissioners' and corporation counsel's criminal
liability. However, the federal court of appeals reversed, finding
that the district court had only determined that the city had the
power to enter into the decree, and not that the negotiation
process was lawful. Derrickson v. City of Danville, 845 F.2d 715,
723 (7th Cir. 1988).
Subsequently, the group stood trial in the circuit court of
Vermilion County on the criminal charges of violating conflict of
interest (Ill. Rev. Stat. 1989, ch. 24, par. 3--14--4; ch. 102,
par. 3) and official misconduct (Ill. Rev. Stat. 1989, ch. 38, par.
33--3) statutes. During the bench trial, the commissioners and
corporation counsel admitted that they had no right to require that
they retain their jobs as a condition of settling the voting rights
litigation and that they were not legally entitled to retention.
The circuit court found all of the commissioners and the
corporation counsel guilty of official misconduct (Ill. Rev. Stat.
1989, ch. 38, par. 33--3(c)) and violating the prohibitions against
municipal officials holding pecuniary interests in governmental
contracts (Ill. Rev. Stat. 1989, ch. 24, par. 3--14--4(a); ch. 102,
par. 3(a)). The commissioners were each sentenced to two years'
conditional discharge and fined $1,000. The corporation counsel was
sentenced to two years' conditional discharge, 90 days'
imprisonment, and fined $5,000.
While the appeal of their convictions was still pending before
the appellate court, Commissioner Wilbur Scharlau died. The
appellate court abated all proceedings against Scharlau ab initio
and vacated his conviction. Subsequently, the appellate court
reversed the convictions (People v. Scharlau, 193 Ill. App. 3d 280
(1990)); however, this court reversed the appellate court and
reinstated the convictions (People v. Scharlau, 141 Ill. 2d 180
(1990)). Thereafter, the commissioners and corporation counsel were
unsuccessful in seeking a writ of habeas corpus in federal court.
Wright v. DeArmond, 977 F.2d 339, 343-44 (7th Cir. 1992). As a
result of this prolonged litigation, the group incurred attorney
fees and litigation expenses of $321,311.47.
The present appeal arises out of plaintiffs' two-count
complaint filed in the circuit court of Vermilion County seeking
reimbursement of the attorney fees and litigation expenses, but not
criminal fines, from the city. The complaint was based on two
Danville indemnity ordinances, number 7192 (Danville, Ill.,
Ordinance No. 7192 (eff. July 8, 1986)) and number 7237 (Danville,
Ill., Ordinance No. 7237 (eff. March 10, 1987)) (count I), and on
common law indemnity (count II). The pertinent ordinance was passed
by the commissioners subsequent to the entry of the consent decree
in federal district court. The relevant language from the ordinance
follows:
"Where the Mayor, member of the City Council, or any
appointee of the Mayor or any member of the City Council,
has acted in his official capacity, the City shall
indemnify the Mayor, member of City Council, or any
appointee of the Mayor or member of the City Council who
was or is a party or is threatened to be made a party to
any threatened, pending, or completed action, suit, or
proceeding by reason of the fact that the person is or
was the Mayor, member of the City Council, or any
appointee of the Mayor or any member of the City Council,
of the city. Under this indemnification, the city shall
pay all expenses (including attorneys' fees), judgments,
fines, and amounts paid in settlement actually and
reasonably incurred by the person in connection with such
action, suit, or proceeding if he acted in good faith and
in a manner he reasonably believed to be in or not
opposed to the best interests of the city. Such
indemnification by the city shall apply to any criminal
action or proceeding, if the indemnified person had no
reasonable cause to believe his conduct was unlawful, and
any act or omission within the scope of the office or
employment." Danville, Ill., Ordinance No. 7237 (eff.
March 10, 1987).
The city subsequently filed a combined motion to dismiss
pursuant to sections 2--615 and 2--619(a)(9) of the Code of Civil
Procedure (735 ILCS 5/2--615, 2--619(a)(9) (West 1994)). In support
of its motion, the city submitted certified copies of the trial
court's findings in the criminal prosecution of the commissioners
and corporation counsel and this court's opinion affirming the
criminal convictions. The circuit court, finding no basis for
indemnity under either the ordinances or common law indemnity,
granted the city's motion to dismiss. The circuit court also
observed that the commissioners' act of amending the ordinance to
provide additional indemnity "tainted the circumstances in such a
way" that indemnity was improper. The appellate court reversed. 267
Ill. App. 3d 375. It concentrated on the language of the indemnity
ordinance and determined that the plaintiffs could conceivably
prove a set of facts that would enable them to recover and,
therefore, the city was not entitled to judgment as a matter of
law.
The city argues before this court that the appellate court
must be reversed and the trial court's dismissal of the action
affirmed because (1) Danville's indemnity ordinance is invalid as
against the public policy which prohibits the indemnification of
expenses arising from one's own willful misconduct; (2) the
doctrine of collateral estoppel precludes plaintiffs from
relitigating the issue of scope of employment which was determined
by the commissioners' and corporation counsel's criminal
convictions; and (3) plaintiffs cannot recover under a theory of
common law indemnity because they are the ones who engaged in
wrongful conduct.
ANALYSIS
The question presented by a motion to dismiss pursuant to
section 2--615 is whether sufficient facts are contained in the
pleadings which, if established, would entitle the plaintiff to
relief. Urbaitis v. Commonwealth Edison, 143 Ill. 2d 458, 475
(1991). The circuit court should dismiss a cause of action on the
pleadings only if it is clearly apparent that no set of facts can
be proven which will entitle a plaintiff to recovery. Illinois
Graphics Co. v. Nickum, 159 Ill. 2d 469, 488 (1994). If a cause of
action is dismissed pursuant to a section 2--619 motion on the
pleadings, the questions on appeal are whether a genuine issue of
material fact exists and whether the defendant is entitled to a
judgment as a matter of law. Illinois Graphics Co., 159 Ill. 2d at
494. Nevertheless, a dismissal pursuant to section 2--619 may be
affirmed on any grounds which are called for by the record
regardless of whether the circuit court relied on those grounds or
whether the circuit court's reasoning was correct. Beckman v.
Freeman United Coal Mining Co., 123 Ill. 2d 281, 286 (1988).
I. Validity of the Indemnity Ordinance
The city contends that plaintiffs cannot recover under the
indemnity ordinance because it is invalid as against public policy.
In support of this argument, the city cites cases for the general
proposition that agreements to indemnify against one's own willful
misconduct are contrary to public policy and thus unenforceable.
See, e.g., Davis v. Commonwealth Edison Co., 61 Ill. 2d 494, 500-01
(1975). However, the city's reliance on such precedent is
misplaced. All the cases cited involved indemnification under
provisions of an insurance policy or other type of contract. See
Davis, 61 Ill. 2d at 495-96 (indemnity clause in construction
contract); West Suburban Mass Transit District v. Consolidated R.
Corp., 210 Ill. App. 3d 484, 489-91 (1991) (indemnity clause in
agreement regarding use of railroad tracks); Rubenstein Lumber Co.
v. Aetna Life & Casualty Co., 122 Ill. App. 3d 717, 717-18 (1984)
(indemnity clause of insurance policy). As the city itself
observes, this case involves no contract or bargained-for agreement
which plaintiffs rely on for indemnity. Rather, plaintiffs rely on
an indemnity ordinance which was passed by the commissioners to
place liability on the municipality for certain litigation brought
against its officials. The General Assembly has expressly
authorized local public entities to indemnify their officers and
employees in certain situations. See 745 ILCS 10/2--302 (West 1994)
(local public entity may indemnify employees for judgment and costs
of certain civil actions; however, it may not indemnify punitive
damage awards); 745 ILCS 10/9--102 (West 1994) (local public entity
is empowered to pay certain tort judgments entered against an
employee).
However, even if the indemnity ordinance does not violate
public policy, public policy is not the only limitation a local
public entity encounters when it determines how to expend its
public funds. The expenditure of public funds must be for a public
purpose. Ill. Const. 1970, art. VIII, §1; see also Elsenau v. City
of Chicago, 334 Ill. 78, 81 (1929); City of Elmhurst ex rel.
Mastrino v. City of Elmhurst, 272 Ill. App. 3d 168, 173 (1994); 65
ILCS 5/8--1--2 (West 1994). Defraying the costs of purely private
litigation has always been outside the bounds of a proper public
purpose. See, e.g., City of Chicago v. Williams, 182 Ill. 135
(1899); City of Elmhurst ex rel. Mastrino, 272 Ill. App. 3d at 173.
Plaintiffs assert that the indemnity ordinance was enacted for
a public purpose and to benefit the city. Although a legislative
body may have broad discretion in determining what constitutes a
public purpose (People ex rel. City of Salem v. McMackin, 53 Ill.
2d 347, 355 (1972)), that discretion is not unlimited and courts
will intervene when public property is devoted to a purely private
use (City of Elmhurst ex rel. Mastrino, 272 Ill. App. 3d at 173).
An unsuccessful criminal defense involving the holder of a public
office, but not arising out of the lawful exercise of the duties of
that office, is purely private litigation (see Guerine v. City of
Northlake, 1 Ill. App. 3d 603 (1971)), and as such, absorbing the
costs of such litigation cannot be considered a proper public
purpose (City of Elmhurst ex rel. Mastrino, 272 Ill. App. 3d at
173). Moreover, even a home rule unit, such as Danville, may only
exercise powers and perform functions pertaining to its government
and affairs. Ill. Const. 1970, art. VII, §6(a). Legal expenses
privately incurred by holders of public office pursuant to their
conviction of criminal official misconduct and corruption charges
cannot reasonably be said to pertain to a home rule unit's
government and affairs.
Plaintiffs cite City of Montgomery v. Collins, 355 So. 2d 1111
(Ala. 1978), for the general proposition that it is a proper
corporate purpose for a municipality to expend public funds to
defend its officials from criminal charges. Collins, 355 So. 2d at
1114. In City of Montgomery v. Collins, the Supreme Court of
Alabama determined that defense of police officers from criminal
perjury charges was a proper corporate purpose. However, in doing
so, the court relied primarily on the fact that the city risked
liability in subsequent civil litigation should the police officers
be convicted. Collins, 355 So. 2d at 1114-15. This concern is
inapplicable in the instant case. First, in City of Montgomery v.
Collins there was no indemnity statute or ordinance at issue.
Contrarily, the Illinois General Assembly has already addressed the
indemnity of local public employees and the corresponding civil
liability of their employing cities. See 745 ILCS 10/2--302, 9--102
(West 1994). Additionally, the commissioners and corporation
counsel were convicted of official misconduct and conflict of
interest charges for holding an interest in a government contract.
The city is at no risk of becoming involved in civil litigation
with an injured third party as a result of the convictions. In
fact, if there was any victim of the commissioners' and corporation
counsel's actions, it was the city itself. See City of Chicago ex
rel. Cohen v. Keane, 64 Ill. 2d 559, 567-68 (1976) (recognizing a
city's right to recover from its officials who are convicted of
corruption charges).
Although plaintiffs are correct in their assertion that courts
in some jurisdictions have determined that defending a public
official from criminal charges may be a proper public purpose, it
is generally held in these jurisdictions that a valid public
purpose exists only when the authority of the municipality is
limited to the reimbursement of legal expenses incurred in a
successful defense. See Lomelo v. City of Sunrise, 423 So. 2d 974,
976-77 (Fla. App. 1983) (costs of defending public official for
misconduct charges served public purpose only because official was
acquitted of charges); Ellison v. Reid, 397 So. 2d 352, 354 (Fla.
App. 1981); Snowden v. Anne Arundel County, 295 Md. 429, 439, 456
A.2d 380, 385 (1983) (indemnity ordinance served public purpose
primarily because it limited reimbursement to only those public
officials who had successfully defended themselves against criminal
charges); Bowens v. City of Pontiac, 165 Mich. App. 416, 420, 419
N.W.2d 24, 26 (1988) (Shepherd, J., concurring); Sonnenberg v.
Farmington Township, 39 Mich. App. 446, 449, 197 N.W.2d 853, 854
(1972); Kroschel v. City of Afton, 512 N.W.2d 351, 355 (Minn. App.
1994); Valerius v. City of Newark, 84 N.J. 591, 596, 423 A.2d 988,
991-92 (1980); Beckett v. Board of Supervisors, 234 Va. 614, 619
n.7, 363 S.E.2d 918, 921 n.7 (1988). Still, other states have held
that the costs of defending a public official from criminal or
official misconduct charges is never a proper public purpose. See
Hall v. Thompson, 283 Ark. 26, 28-29, 669 S.W.2d 905, 906-07
(1984); Bowling v. Brown, 57 Md. App. 248, 260, 469 A.2d 896, 902
(1984); Corning v. Village of Laurel Hollow, 48 N.Y.2d 348, 353-54,
398 N.E.2d 537, 540-41, 422 N.Y.S.2d 932, 935-36 (1979); Township
of Manalapan v. Loeb, 126 N.J. Super. 277, 278-79, 314 A.2d 81, 81-
82 (1974) (no authority for indemnification of municipal officer
for costs of defending criminal charges which amount to official
misconduct); Silver v. Downs, 493 Pa. 50, 55-57, 425 A.2d 359, 362-
64 (1981); see also 56 Am. Jur. 2d Municipal Corporations §208
(1971) (municipality has no power to reimburse an official for
expenses incurred in defense of official misconduct charges); 63A
Am. Jur. 2d Public Officers and Employees §406 (1984) (members of
governing body may not expend public funds to shield themselves
from consequences of own unlawful and corrupt acts); 3 McQuillin on
Municipal Corporations §12.137.10 (3d rev. ed. 1990) (municipality
cannot expend money to reimburse its officer for expenses incurred
in defending official misconduct charges). Under the principles of
all these cases, plaintiffs would not be able to recover the
expenses of the unsuccessful criminal defense of the commissioners
and corporation counsel from the city.
Further, the purpose of indemnification, so as not to inhibit
capable individuals from seeking public office, has no relevance in
the context of the criminal conduct involved in this case. No
official of public government should be encouraged to engage in
criminal acts by the assurance that he will be able to pass defense
costs on to the taxpayers of the community he was elected to serve.
See Powers v. Union City Board of Education, 124 N.J. Super. 590,
596, 308 A.2d 71, 75 (1973). To the contrary, holding public
officials personally liable for the expenses incurred in
unsuccessfully defending charges of their criminal misconduct in
office tends to protect the public and to secure honest and
faithful service by such servants. Indeed, allowing expenditure of
public funds for such use would encourage a disregard of duty and
place a premium upon neglect or refusal of public officials to
perform the duties imposed upon them by law. Bowling v. Brown, 57
Md. App. 248, 258, 469 A.2d 896, 901 (1984) ("[T]o reimburse
[convicted public officials] for their legal expenses would not
encourage the `faithful and courageous discharge of duty on the
part of public officials.' [Citation.] On the contrary, it would
encourage the reverse"). The types of individuals who are drawn to
these corrupt practices should not be given any incentive to seek
public office.
Our holding is also compatible with the articulated purpose of
the official misconduct and conflict of interest statutes, which is
to keep the loyalties of public officials to their public trust
undivided and to compel them to act in a lawful manner while acting
in their official capacities. Fellhauer v. City of Geneva, 142 Ill.
2d 495, 506 (1991); Scharlau, 141 Ill. 2d at 198; People v. Samel,
115 Ill. App. 3d 905, 910-11 (1983). To allow the use of public
funds to reimburse a convicted official for his legal expenses
would shield that official from the entire consequences of his
illegal conduct, thus frustrating the purpose of those statutes. In
conclusion, the city has neither the duty nor the authority to
reimburse plaintiffs for legal fees incurred in the unsuccessful
defense of criminal official misconduct and conflict of interest
charges. Therefore, to the extent it attempts to indemnify
officials convicted of crimes for their attorney fees and costs
incurred in their unsuccessful criminal defense, we hold the
Danville ordinance invalid. In so holding, we expressly make no
determination regarding the authority of any municipality or home
rule unit to indemnify their officers and employees who are found
not guilty of criminal conduct.
II. Scope of Employment
In the event that the public purpose doctrine did not prevent
reimbursement of plaintiffs for their criminal litigation expenses,
plaintiffs still could not recover under the ordinance or any
statute because the commissioners' and corporation counsel's
actions, as a matter of law, were outside the scope of their
employment. We disagree with the appellate court's determination
that scope of employment is not a real issue in the case. Acting
within the scope of their office or employment is a prerequisite
for plaintiffs to receive indemnity under the specific terms of the
ordinance. Danville, Ill., Ordinance No. 7237 (eff. March 10,
1987). Moreover, a statutory requirement for any indemnification of
employees of local public entities is that the underlying act
occurred within the scope of employment. 745 ILCS 10/2--302, 9--102
(West 1994). Finally, under a traditional respondeat superior
analysis, an employer can be liable for the torts of his employee,
however, only for those torts that are committed within the scope
of that employment. See Pyne v. Witmer, 129 Ill. 2d 351, 359
(1989); see generally Restatement (Second) of Agency §219 (1958).
Therefore, because there are no means for the city to indemnify the
commissioners and corporation counsel unless their actions were
within the scope of their employment, it is dispositive in this
case.
While even the criminal acts of an employee may fall within
the scope of employment (see, e.g., Webb v. Jewel Cos., 137 Ill.
App. 3d 1004, 1006 (1985); Restatement (Second) of Agency §231
(1958)), if the employee's actions are different from the type of
acts he is authorized to perform or were performed purely in his
own interest, he has departed from the scope of employment (see
Sunseri v. Puccia, 97 Ill. App. 3d 488, 493 (1981); Restatement
(Second) of Agency §228(2) (1958)). Moreover, an employer is not
responsible for acts which are clearly inappropriate to or
unforeseeable in the accomplishment of an authorized result.
Serious crimes are generally unforeseeable because they are
different in nature from what employees in a lawful occupation are
expected to do. See Restatement (Second) of Agency §231, Comment a
(1958); see also Webb, 137 Ill. App. 3d at 1006; Nelson v. Nuccio,
131 Ill. App. 2d 261, 263 (1971). Further, if a deviation is
exceedingly marked and unusual, the employee may be found to be
outside the scope of employment as a matter of law. Pyne, 129 Ill.
2d at 361.
We recognize that this case does not involve the circumstances
typically present in a traditional respondeat superior analysis--
when an injured third party attempts to hold an employer
vicariously liable for the torts of an employee. Nevertheless, the
principles advanced in the context of imposing vicarious liability
upon an employer are applicable in cases seeking to impose duties
upon a public entity to indemnify and defend its employees because
both liabilities are premised upon employee acts occurring within
the scope of employment. See Deloney v. Board of Education, 281
Ill. App. 3d 775 (1996). In applying these principles to the case
at bar, it is clear that the commissioners' and corporation
counsel's self-dealing was committed solely for their personal
benefit and had no relation to their positions as elected
officials. Although the commissioners had authority to negotiate a
settlement of the voting rights lawsuit, utilizing the negotiations
to illegally advance their own personal interests by preserving
their employment were actions obviously different from those they
were authorized to perform. No elected official can be authorized
to act in a manner that violates official misconduct and conflict
of interest statutes. Hall v. Thompson, 283 Ark. 26, 28-29, 669
S.W.2d 905, 906-07 (1984) (official duties of a public official
never require him to participate in criminal activities). Moreover,
this court has already determined that the commissioners' and
corporation counsel's acts were unauthorized. Scharlau, 141 Ill. 2d
at 196.
Additionally, the group's actions, which resulted in their
convictions of official misconduct and conflict of interest
charges, were clearly committed for their own interests. A
conviction for corrupt practices establishes that a public official
exploited his fiduciary position for his personal benefit. City of
Chicago ex rel. Cohen v. Keane, 64 Ill. 2d 559, 565 (1976).
Furthermore, the essence of a violation of the statute "is that a
public official has attempted to personally enrich himself or
another by an act exceeding his `lawful authority' as a public
servant." People v. Samel, 115 Ill. App. 3d 905, 909 (1983). The
official misconduct statutes are intended to punish the activities
of public officials who have exploited their official positions to
the detriment of the public good. People v. Steinmann, 57 Ill. App.
3d 887, 897 (1978). The commissioners and corporation counsel
admitted that they would not have settled the voting rights action
without the provisions ensuring their continued employment for a
fixed term and the right to set their own salaries. In addition,
the group knew that they were not legally entitled to these
provisions. Such self-dealing can be nothing more than acting
purely in one's own interests. See Board of Chosen Freeholders of
the County of Burlington v. Conda, 164 N.J. Super. 386, 390 396
A.2d 613, 617 (1978) (misconduct involving personal gain at public
expense cannot be said to benefit the public).
While the commissioners' and corporation counsel's public
employment provided the opportunity for their misconduct, by no
stretch of the imagination could their actions be deemed an
extension of their legitimate functions as elected officials.
Therefore, their conduct neither arose out of nor was incidental to
the performance of their duties and, thus, was not within the scope
of their employment. See Bowling v. Brown, 57 Md. App. 248, 258,
469 A.2d 896, 901 (1984); Valerius v. City of Newark, 84 N.J. 591,
596, 423 A.2d 988, 990-91 (1980) (criminal conviction for misuse of
office constitutes a "perversion and prostitution" of duties and
establishes that the acts were not within scope of employment);
Powers v. Union City Board of Education, 124 N.J. Super. 590, 596,
308 A.2d 71, 75 (1973) (criminal misconduct originating out of
performance of duties was not act occurring within the scope of
those duties). In this case, the record clearly reveals that the
commissioners and corporation counsel stepped aside from their
duties as officers of the City of Danville and acted for the sole,
unlawful, independent, and personal purpose of promoting their own
interests. As a matter of law, their actions were outside the scope
of their employment such that the city owed no statutory duty to
defend or indemnify them in the criminal action.
III. Collateral Estoppel
The city also contends that inherent in the commissioners' and
corporation counsel's criminal convictions is the determination
that they also acted outside the scope of their employment. The
city then reasons that the doctrine of collateral estoppel thus
bars plaintiffs from relitigating the scope of employment issue in
this case. Plaintiffs respond that scope of employment was not an
issue decided in People v. Scharlau. Alternatively, plaintiff Kevin
Scharlau independently argues that he cannot be bound by any
determinations made in People v. Scharlau because Wilbur Scharlau's
conviction was vacated.
Notwithstanding these contentions, we determined today that,
as a matter of law, by virtue of their criminal convictions the
commissioners and corporation counsel acted outside the scope of
their employment. Furthermore, we determined that the public
purpose doctrine prevents reimbursement of plaintiffs in this
instance. Therefore, we need not address whether People v. Scharlau
decided the scope of employment issue or the effect of collateral
estoppel upon this litigation.
IV. Common Law Indemnity
Plaintiffs also contend that they are entitled to
reimbursement of their legal expenses under a common law theory of
indemnity. They cite cases for the general proposition that a
principal is required to indemnify an agent for losses resulting
from the good-faith execution of the agency. See Lundy v. Whiting
Corp., 93 Ill. App. 3d 244, 258 (1981); American Telephone &
Telegraph Co. v. Leveque, 30 Ill. App. 2d 120, 128 (1961); Lomelo
v. City of Sunrise, 423 So. 2d 974, 976 (Fla. App. 1983); Ellison
v. Reid, 397 So. 2d 352, 354 (Fla. App. 1981); State ex rel. Crow
v. City of St. Louis, 174 Mo. 125, 148, 73 S.W. 623, 630 (1903).
However, none of these cases support plaintiffs' position. American
Telephone & Telegraph Co. v. Leveque and Lundy v. Whiting Corp.
both dealt with the issue of implied indemnity among joint
tortfeasors. Specifically, when two tortfeasors have breached a
duty to a plaintiff, the passively negligent tortfeasor may be
allowed to shift liability to the actively negligent tortfeasor.
See American Telephone & Telegraph Co., 30 Ill. App. 2d at 127-28;
Lundy v. Whiting Corp., 93 Ill. App. 3d at 258. This theory is not
applicable to the instant case and plaintiffs have conceded as much
in their briefs.
The other cases offered by plaintiffs stand for the
propositions that a public official acting pursuant to authority,
within the scope of employment, and while serving a public purpose
may be indemnified by a municipality for expenses he incurs. See
Lomelo, 423 So. 2d at 976; Ellison, 397 So. 2d at 354; State ex
rel. Crow, 174 Mo. at 148, 73 S.W. at 630. We have already
determined that the commissioners and corporation counsel were not
acting pursuant to authority or within the scope of their
employment and they were not serving a public purpose. Therefore,
plaintiffs' action for common law indemnity also must fail.
CONCLUSION
For the foregoing reasons, the judgment of the appellate court
is reversed. The judgment of the circuit court dismissing the
complaint is affirmed.
Appellate court judgment reversed;
circuit court judgment affirmed.
CHIEF JUSTICE BILANDIC took no part in the consideration or
decision of this case.