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    "parties": [
      "GEORGE NAMUR et al., Plaintiffs-Appellees, v. THE HABITAT COMPANY, Defendant-Appellant."
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        "text": "PRESIDING JUSTICE CERDA\ndelivered the opinion of the court:\nDefendant, The Habitat Company, appeals from the denial of its motion to dismiss the lawsuit of plaintiffs, George Namur and Matthew Tolf, who are the former tenants of an apartment leased from defendant. Defendant also appeals from a penalty and attorney fees imposed pursuant to the Chicago Residential Landlord and Tenant Ordinance (Chicago Municipal Code \u00a7 5 \u2014 12\u2014010 et seq. (amended November 6, 1991)) (hereinafter the ordinance) based on defendant\u2019s failure to attach a summary of the ordinance to plaintiffs\u2019 lease. Plaintiffs argue in their cross-appeal that they were entitled to the full amount of their attorney fees and that the trial court erred in finding that defendant did not commingle their security deposit with defendant\u2019s assets.\nThe issue we address is whether plaintiffs\u2019 action alleging violations of the Chicago Residential Landlord and Tenant Ordinance sections sought a \u201cstatutory penalty\u201d within the meaning of the two-year statute of limitations found in section 13 \u2014 202 of the Code of Civil Procedure (735 ILCS 5/13 \u2014 202 (West 1996)).\nFACTS\nOn December 8, 1991, plaintiffs gave a security deposit and signed a lease for an apartment for a term running from February 1, 1992, through March 31, 1993. The security deposit was deposited that month. After plaintiffs vacated the apartment, they received their security deposit back with interest.\nOn September 16, 1994, plaintiffs filed a two-count verified complaint against defendant. Count I sought attorney fees and damages under the ordinance in the amount of twice the security deposit for defendant\u2019s alleged failure to comply with section 5 \u2014 12\u2014080(a) of the ordinance, which prohibited security deposits from being commingled with assets of landlords (Chicago Municipal Code \u00a7 5 \u2014 12\u2014 080(a) (amended November 6, 1991)). Count II sought damages and attorney fees for defendant\u2019s alleged violation of section 5 \u2014 12\u2014170 of the ordinance, which required landlords to attach a summary of the ordinance to each written rental agreement (Chicago Municipal Code \u00a7 5 \u2014 12\u2014170 (amended November 6, 1991)).\nDefendant filed a motion to dismiss the complaint on the basis that the action was not filed within the two-year statute of limitations contained in section 13 \u2014 202 of the Code of Civil Procedure for \u201c[ajctions for damages *** for a statutory penalty\u2019 (735 ILCS 5/13\u2014 202 (West 1996)). Defendant argued that the causes of action accrued in 1991, when the lease was signed and when the security deposit was deposited.\nThe trial court denied the motion to dismiss. The trial court found that the ordinance was not a \u201cstatute\u201d within the meaning of section 13 \u2014 202. The trial court instead applied the five-year statute of limitations for civil actions that were \u201cnot otherwise provided for.\u201d 735 ILCS 5/13 \u2014 205 (West 1996).\nOn November 22, 1996, the trial court found for plaintiffs on count I in the amount of $100 and found for defendant on count II. On February 19, 1997, the trial court entered judgment in favor of plaintiffs for $1,470 in attorney fees.\nDefendant appealed, and plaintiffs cross-appealed.\nDISCUSSION\nDefendant first argues in its appeal that the trial court erred in denying its motion to dismiss because the complaint was not filed within the two-year statute of limitations for \u201c[a]ctions for damages *** for a statutory penalty.\u201d 735 ILCS 5/13 \u2014 202 (West 1996). In support of this issue, defendant argues that section 5 \u2014 12\u2014080(f) of the ordinance, imposing damages in the amount of two times the monthly rent for commingling a tenant\u2019s security deposit, and section 5 \u2014 12\u2014 170 of the ordinance, imposing fixed damages in the amount of $100 for failing to attach a summary of the ordinance, are penal provisions. Plaintiffs argue that the ordinance is a remedial ordinance.\nThe ordinance states its purpose:\n\u201cIt is the purpose of this chapter and the policy of the city, in order to protect and promote the public health, safety and welfare of its citizens, to establish the rights and obligations of the landlord and the tenant in the rental of dwelling units, and to encourage the landlord and the tenant to maintain and improve the quality of housing.\u201d Chicago Municipal Code \u00a7 5 \u2014 12\u2014010 (amended November 6, 1991).\nThe ordinance \u201cshall be liberally construed and applied to promote its purposes and policies.\u201d Chicago Municipal Code \u00a7 5 \u2014 12\u2014010 (amended November 6, 1991).\nCount I of the complaint was based on section 5 \u2014 12\u2014080(a) of the ordinance, which provides:\n\u201cA security deposit and interest due thereon shall continue to be the property of the tenant making such deposit, shall not be commingled with the assets of the landlord, and shall not be subject to the claims of any creditor of the landlord ***.\u201d Chicago Municipal Code \u00a7 5 \u2014 12\u2014080(a) (amended November 6, 1991).\nSection 5 \u2014 12\u2014080(f) of the ordinance provides the damages for violation of the commingling prohibition:\n\u201cIf the landlord or landlord\u2019s agent fails to comply with any provision of Section 5 \u2014 12\u2014080(a)\u2014(e), the tenant shall be awarded damages in an amount equal to two times the security deposit plus interest at five percent. This subsection does not preclude the tenant from recovering other damages to which he may he entitled under this chapter.\u201d Chicago Municipal Code \u00a7 5 \u2014 12\u2014080(f) (amended November 6, 1991).\nCount II of the complaint was based on section 5 \u2014 12\u2014170 of the ordinance, which provides:\n\u201cThe commissioner of the department of housing shall prepare a summary of this chapter, describing the respective rights, obligations and remedies of landlords and tenants hereunder, and shall make such summary available for public inspection and copying. A copy of such summary shall be attached to each written rental agreement when any such agreement is initially offered to any tenant or prospective tenant by or on behalf of a landlord and whether such agreement is for a new rental or a renewal thereof.\n*** If a tenant in a civil legal proceeding against his landlord establishes that a violation of this section has occurred, he shall be entitled to recover $100.00 in damages.\u201d Chicago Municipal Code \u00a7 5 \u2014 12\u2014170 (amended November 6, 1991).\nThe ordinance does not contain a provision limiting the time within which actions must be brought.\nSection 13 \u2014 202 of the Code of Civil Procedure states in part as follows:\n\u201cActions for damages for an injury to the person, or for false imprisonment, or malicious prosecution, or for a statutory penalty *** shall be commenced within 2 years next after the cause of action accrued ***.\u201d 735 ILCS 5/13 \u2014 202 (West 1996).\nA statute is penal if it imposes automatic liability for a violation of its terms and if the amount of liability is predetermined by the statute and imposed without actual damages suffered by the plaintiff. McDonald\u2019s Corp. v. Levine, 108 Ill. App. 3d 732, 738, 439 N.E.2d 475 (1982). A statute is remedial where it imposes liability only for actual damages resulting from a violation. McDonald\u2019s, 108 Ill. App. 3d at 738. The ordinance has been found to be penal (Szpila v. Burke, 279 Ill. App. 3d 964, 971, 665 N.E.2d 357 (1996)), but it also has been characterized as having remedial purposes (Friedman v. Krupp Corp., 282 Ill. App. 3d 436, 443, 668 N.E.2d 142 (1996)). Some portions of the ordinance are remedial because they permit recovery of actual damages. For example, under section 5 \u2014 12\u2014060, the tenant may recover actual damages for the landlord\u2019s unlawful entry, although not more than one month\u2019s rent, and the landlord may recover actual damages for the tenant\u2019s refusal to allow lawful access. Chicago Municipal Code \u00a7 5 \u2014 12\u2014060 (amended November 6, 1991).\nThe sections of the ordinance that are the basis of plaintiffs\u2019 action, sections 5 \u2014 12\u2014080(f) and 5 \u2014 12\u2014170, are penal because they specify either the amount of damages that can be awarded for violations or the formula by which the amount of damages is to be calculated. Although damages under section 5 \u2014 12\u2014080(f) for commingling security deposits are based on the actual amount of the security deposit, the damages are not actual. The tenant would not suffer actual damages if the commingled security deposit was not seized by the landlord\u2019s creditors, but the ordinance assesses a penalty for endangering security deposits in the amount of double the security deposit plus 5% interest. We find that sections 5 \u2014 12\u2014080(f) and 5 \u2014 12\u2014170 of the ordinance are penal and hold that plaintiffs\u2019 action is one for a \u201cpenalty\u201d within the meaning of section 13 \u2014 202.\nThe next issue is whether plaintiffs\u2019 lawsuit seeks a \u201cstatutory\u201d penalty within the meaning of section 13 \u2014 202. Plaintiffs argue that section 13 \u2014 202 is not applicable because it does not include actions for damages for penalties imposed by a municipal ordinance but only penalties imposed by a state statute.\nThe primary rule of statutory construction is to give effect to the true intent of the legislature, and an inquiry into legislative intent must begin with the language of the statute. Advincula v. United Blood Services, 176 Ill. 2d 1, 16, 678 N.E.2d 1009 (1996). Words used in a statutory provision must be given their plain and ordinary meaning. Advincula, 176 Ill. 2d at 17. Statutes of limitation must be construed in light of their objectives and must be liberally construed to fulfill the object for which they were enacted. Mathis v. Hejna, 109 Ill. App. 2d 356, 360, 248 N.E.2d 767 (1969).\nSection 13 \u2014 202 has been applied to an action under a statute that does not permit recovery for actual damages but specifies a formula by which damages are to be calculated. See Sun Theatre Corp. v. RKO Radio Pictures, 213 F.2d 284, 286-88 (7th Cir. 1954) (predecessor of section 13 \u2014 202 applied to action under federal antitrust law that provided for treble damages). Section 13 \u2014 202 has been held not to apply to an action under .a statute that permits actual damages and exemplary damages with a cap. Dawson v. W. & H. Voortman, Inc., 864 F. Supp. 77, 79 (N.D. Ill. 1994) (section 13\u2014 202 did not apply to Illinois Sales Representative Act (820 ILCS 120/ 0.01 (West 1994)), which did not impose an automatic figure for a statutory penalty). In Dawson, the statute providing for payment of commissions only directed the employer to pay commissions due in a timely manner; the plaintiff would still have to prove actual damages.\nWe note a California case that found that a rent-control ordinance that specified treble damages provided for a penalty within the meaning of a state one-year statute of limitations similarly covering actions upon \u201ca statute for a penalty.\u201d Menefee v. Ostawari, 228 Cal. App. 3d 239, 278 Cal. Rptr. 805 (1991); Cal. Civ. Proc. Code \u00a7 340(1) (West 1982). In Menefee, plaintiff\u2019s complaint alleged wrongful termination of his month-to-month tenancy in violation of the San Francisco rent control ordinance. Plaintiff argued that the ordinance\u2019s provision for treble damages was not punitive but had an objective to promote effective enforcement of the ordinance. Menefee, 228 Cal. App. 3d at 244, 278 Cal. Rptr. at 808. Under California law, claims based upon statutes that provide for mandatory recovery of damages additional to actual losses incurred are considered penal in nature and thus are governed by the one-year statute of limitations. Menefee, 228 Cal. App. 3d at 243, 278 Cal. Rptr. at 807. The court concluded that, regardless of the purpose of the provision for treble damages, the provision was a penalty and was governed by the one-year statute of limitations. Menefee, 228 Cal. App. 3d at 245, 278 Cal. Rptr. at 808.\nDefendant contends that the issue of section 13 \u2014 202\u2019s applicability to actions brought pursuant to a municipal ordinance was determined by City of Chicago v. Enright, 27 Ill. App. 559 (1888). In Enright, defendants sold liquor without obtaining a license required by a Chicago ordinance, and the city brought suit to obtain a penalty for violating the ordinance. Defendants argued that the applicable statute of limitations was the criminal code\u2019s statute of limitations for prosecutions under a penal statute, but the court held that the action was not a prosecution. Enright, 27 Ill. App. at 568.\nThe Enright court stated that an action of debt for a penalty for the violation of a municipal ordinance was a civil action governed by \u201cSec. 14 of the general statute of limitations, which allows two years after the right accrues within which to bring the action.\u201d Enright, 27 Ill. App. at 568. The court did not provide a further citation to the statute of limitations, but the court must have been referring to section 14 of the revised statutes of 1885, which was the two-year statute of limitations in effect at the time for \u201c[a]ctions for damages *** for a statutory penalty\u201d (Ill. Rev. Stat. 1885, ch. 83, par. 14). The quoted language is the same in the recodified section 13 \u2014 202.\nIn contrast to Enright, the Third District Appellate Court case of City of Peoria v. Toft, 215 Ill. App. 3d 440, 443-44, 574 N.E.2d 1334 (1991), determined that a fine for violation of a municipal parking ordinance was not a statutory penalty under section 13 \u2014 202. The court distinguished an \u201cordinance\u201d from a \u201cstatute\u201d on the basis that an ordinance is a local rule enacted by a unit of government pursuant to authority delegated by the state while a statute \u201cbears the imprimatur of the State legislature.\u201d Toft, 215 Ill. App. 3d at 443. The court held that the phrase \u201cstatutory penalty\u201d in section 13 \u2014 202 did not evince an intent to encompass fines or other penalties exacted for violations of local laws. Peoria, 215 Ill. App. 3d at 444. The court did not address Enright.\nWe reject the reasoning of Toft because an ordinance is a legislative act and is the equivalent of a municipal statute. Halford v. Topeka, 234 Kan. 934, 939, 677 P.2d 975, 980 (1984), citing the definition of \u201cordinance\u201d in Black\u2019s Law Dictionary 989 (5th ed. 1979); see also American Country Insurance Co. v. Wilcoxon, 127 Ill. 2d 230, 243, 537 N.E.2d 284 (1989) (the court referred to an ordinance as a \u201cmunicipal statute\u201d). In addition, Toft is contrary to Enright\u2019s holding that actions for penalties for the violation of an ordinance are covered by the statute of limitations for statutory penalties. We hold that section 13 \u2014 202 applies to plaintiffs\u2019 action under the ordinance because \u201cstatutory\u201d is broad enough to cover municipal ordinances.\nThe accrual of a cause of action occurs when facts exist that authorize the bringing of the action. Goodman v. Harbor Market, Ltd., 278 Ill. App. 3d 684, 689 n.2, 693 N.E.2d 13 (1995). Plaintiffs\u2019 cause of action for commingling the security deposit accrued when the security deposit was deposited in December 1991. Plaintiffs\u2019 cause of action for failing to attach a summary of the ordinance accrued when the lease was offered to plaintiffs, which would have been December 1991. The plaintiffs filed their complaint in 1994. Therefore, plaintiffs\u2019 complaint was untimely filed more than two years from the dates that the causes of action accrued. The trial court erred in not dismissing the action as being barred by section 13 \u2014 202 when it ruled that the five-year statute of limitations applied.\nPlaintiffs argue in the alternative that the two-year limitations period should have been tolled, until the unspecified time that they discovered their causes of action. See Knox College v. Celotex Corp., 88 Ill. 2d 407, 414, 430 N.E.2d 976 (1981) (under the discovery rule applying to the statute of limitations, the starting of the period of limitations is postponed until the injured party knows or should have known of his injury). However, the plaintiffs did not plead in their complaint that they did not discover their causes of action until after the termination of their lease. It is incumbent upon a plaintiff seeking to take advantage of the discovery rule to plead in the complaint that the cause of action remained undiscovered. Waterford Condominium Ass\u2019n v. Dunbar Corp., 104 Ill. App. 3d 371, 376, 432 N.E.2d 1005 (1982). Because the failure to discover the ordinance violation was not pied, the discovery rule is not applicable in this case.\nAlso, because of strict application of penalties for violations of municipal ordinances, perhaps the discovery rule is not applicable in these types of ordinances. However, we do not make a ruling on this point.\nWe do not need to decide whether the discovery rule applies to this cause of action for another reason. We find that we are unable on this record to determine when the statute of limitations would be tolled because there was no evidence at trial of when plaintiffs discovered their causes of action.\nPlaintiffs also argue in the alternative that the 10-year statute of limitations for \u201cactions on *** written leases\u201d applies. 735 ILCS 5/13 \u2014 206 (West 1996). We reject this argument because plaintiffs\u2019 action is not based on the lease but is based on an ordinance.\nWe do not need to reach the remaining issues raised in the appeal and the cross-appeal.\nThe judgment of the trial court is reversed.\nReversed.\nMcNAMARA and SOUTH, JJ., concur.",
        "type": "majority",
        "author": "PRESIDING JUSTICE CERDA"
      }
    ],
    "attorneys": [
      "Sandford Kahn, Ltd., of Chicago (Richard W. Christoff, of counsel), for appellant.",
      "Paul Bernstein and Arthur H. Levinson, both of Chicago, for appellees."
    ],
    "corrections": "",
    "head_matter": "GEORGE NAMUR et al., Plaintiffs-Appellees, v. THE HABITAT COMPANY, Defendant-Appellant.\nFirst District (4th Division)\nNos. 1\u201496\u20144288, 1\u201497\u20141034 cons.\nOpinion filed February 11, 1998.\nSandford Kahn, Ltd., of Chicago (Richard W. Christoff, of counsel), for appellant.\nPaul Bernstein and Arthur H. Levinson, both of Chicago, for appellees."
  },
  "file_name": "1007-01",
  "first_page_order": 1025,
  "last_page_order": 1032
}
