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  "name": "ILLINOIS LICENSED BEVERAGE ASSOCIATION, INC., Indiv. and on Behalf of its Members, Plaintiff-Appellee, v. ADVANTA LEASING SERVICES et al., Defendants-Appellants (Preferred Capital, Inc., et al., Defendants)",
  "name_abbreviation": "Illinois Licensed Beverage Ass'n v. Advanta Leasing Services",
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    "parties": [
      "ILLINOIS LICENSED BEVERAGE ASSOCIATION, INC., Indiv. and on Behalf of its Members, Plaintiff-Appellee, v. ADVANTA LEASING SERVICES et al., Defendants-Appellants (Preferred Capital, Inc., et al., Defendants)."
    ],
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      {
        "text": "JUSTICE STEIGMANN\ndelivered the opinion of the court:\nSection 2 \u2014 1001(a)(2)(ii) of the Code of Civil Procedure (Code) provides that a party\u2019s motion for substitution of judge as of right must be granted if the motion \u201cis presented before trial or hearing begins and before the judge to whom it is presented has ruled on any substantial issue in the case.\u201d 735 ILCS 5/2 \u2014 1001(a)(2)(ii) (West 2000). In this case, we consider whether a trial court\u2019s ruling, made at a time the court was without jurisdiction to act, meets the criteria of section 2 \u2014 1001(a)(2)(ii) of the Code, so as to preclude a party after that ruling from obtaining the substitution of judge. We hold that it does not.\nI. BACKGROUND\nIn May 2001, plaintiff, the Illinois Licensed Beverage Association (ILBA), on behalf of itself and its members, filed a complaint for declaratory and injunctive relief and damages against (1) JRA 222 Corporation, d/b/a Credit Card Center (CCC); (2) Information Leasing Corporation and defendants Advanta Leasing Services (Advanta), Preferred Capital, Inc., Marlin Leasing Corporation, QL Capital, Inc., and Liberty Leasing Company (collectively, leasing companies); and (3) individual defendants Mark B. Balotti, Renee Richau, Lindell Larry Bittle, Paul Ribau, Mark Lewis, Tom Dougherty, and Pat Galvin.\nIn June 2001, CCC filed a bankruptcy petition under chapter 11 of title 11 of the United States Code (Bankruptcy Code) (11 U.S.C. \u00a7 1101 et seq. (2000)). On July 9, 2001, ILBA filed in Sangamon County circuit court (trial court) a motion for a preliminary injunction against the leasing companies, seeking, in pertinent part, to enjoin the leasing companies from taking legal action against any of ILBA\u2019s members with whom the leasing companies had entered contracts for the rental of automated teller machines (ATMs). On July 17, 2001, Advanta filed in the trial court a notice stating that the case had been removed to the United States Bankruptcy Court (bankruptcy court). Following a July 18, 2001, hearing, the trial court granted ILBA\u2019s motion for a preliminary injunction.\nLater that month, the bankruptcy court entered an order declaring void any actions the trial court had taken after the July 17, 2001, filing of the removal notice. In August 2001, ILBA voluntarily dismissed CCC as a defendant. On September 5, 2001, the bankruptcy court remanded the case to the trial court, upon finding that, in light of CCC\u2019s dismissal, it no longer had jurisdiction.\nOn September 11, 2001, ILBA filed a motion to reinstate the trial court\u2019s July 18, 2001, preliminary injunction. On September 19, 2001, before the court ruled on ILBA\u2019s motion, Advanta filed a motion for substitution of judge as of right pursuant to section 2 \u2014 1001(a)(2) of the Code (735 ILCS 5/2 \u2014 1001(a)(2) (West 2000)). In October 2001, the court denied Advanta\u2019s motion for substitution of judge, and in November 2001, the court entered another order granting a preliminary injunction against the leasing companies.\nOn appeal, Advanta argues that the trial court (1) erred by denying its motion for substitution of judge as of right; and (2) abused its discretion by granting ILBA\u2019s motion for a preliminary injunction because (a) ILBA failed to satisfy the requirements for a preliminary injunction, (b) the agreements between ILBA members and the leasing companies under which the dispute arose provide that such disputes shall be resolved in New Jersey court; and (c) ILBA lacked standing to sue and failed to name necessary parties. Because we agree with Advanta\u2019s first argument, we reverse and remand for further proceedings.\nA. The Nature of the Parties and the Initial Complaint\nAccording to ILBA\u2019s May 2001 complaint, ILBA is a nonprofit association whose members principally consist of restaurants, bars, liquor stores, fraternal clubs, and recreational facilities that sell alcoholic beverages to the public. In September 1999, ILBA entered into an agreement with CCC, which provided, in pertinent part, that (1) CCC would pay ILBA $200 for each ATM it sold or leased to ILBA members, plus five cents per transaction on all such ATMs; (2) CCC would pay ILBA members 90% of the \u201ctotal swipe surcharge\u201d at their respective ATMs, instead of the standard 85%; and (3) in exchange, ILBA would (a) grant CCC exclusive rights to solicit its members to buy or lease ATMs for use on their premises, and (b) provide CCC with a list of its members.\nILBA\u2019s complaint alleged that between September 1999 and March 2001, CCC\u2019s representatives, including Balotti, Richau, Bittle, Ribau, and Lewis, communicated to ILBA members that if they agreed to lease an ATM from CCC for $269 per month, they would be guaranteed to receive $264 per month from advertising and transaction fees, plus $1.35 each time the ATM was used. In reliance on such representations, over 100 ILBA members entered \u201cMerchant Processing Agreements\u201d and \u201cATM Advertising Agreements\u201d with CCC. CCC representatives also obtained ILBA members\u2019 signatures on separate agreements for the lease of the ATMs. Although the ILBA members believed they were entering into lease agreements with CCC, they were in fact entering into leases with one of the leasing companies.\nIn August 2000, CCC started failing to make payments to ILBA and ILBA\u2019s members. Because the ILBA members\u2019 equipment leases were not with CCC, the members were bound to continue to pay their lessors $269 per month, even though they were not receiving any of the money they had been guaranteed under their agreements with CCC.\nILBA\u2019s complaint further alleged that CCC had fraudulently induced ILBA members to enter lease agreements with the leasing companies. As relief, ILBA requested that the trial court (1) declare the equipment leases null and void; (2) enjoin the leasing companies from enforcing any default or collection of any lease payments from ILBA members until final resolution of the case on the merits; and (3) award damages for breach of contract and common-law fraud and deceit. (At some point after ILBA filed its complaint, it voluntarily dismissed as defendants Information Leasing Corp., Marlin Leasing Corporation, and Liberty Leasing Company.)\nIn June 2001, CCC filed a bankruptcy petition under chapter 11 of the federal Bankruptcy Code (11 U.S.C. \u00a7 1101 et seq. (2000)).\nB. The Preliminary Injunction Proceedings\nOn July 9, 2001, ILBA filed a motion for a preliminary injunction, requesting that the trial court (1) enjoin the leasing companies from declaring defaults under the equipment leases or continuing any litigation against ILBA\u2019s members pending resolution on the merits; and (2) authorize ILBA members to deposit unpaid outstanding lease payments into an escrow account subject to the court\u2019s ongoing jurisdiction.\nOn July 17, 2001, Advanta filed its notice of removal to the bankruptcy court. At a July 18, 2001, hearing on ILBA\u2019s motion for a preliminary injunction, Advanta objected to the trial court\u2019s jurisdiction based on the removal to bankruptcy court. The trial court denied Advanta\u2019s objection and proceeded on ILBA\u2019s motion for a preliminary injunction. After considering the parties\u2019 arguments on the merits, the court granted ILBA\u2019s motion.\nC. Action in the Bankruptcy Court\nIn July 2001, Advanta filed in the bankruptcy court a motion to vacate the trial court\u2019s July 18, 2001, preliminary injunction order. On July 31, 2001, the bankruptcy court entered an order declaring that any action taken in the trial court after July 17, 2001, including that court\u2019s July 18, 2001, order, was void and a nullity. The bankruptcy court\u2019s order' stated, in pertinent part, as follows:\n\u201cAfter hearing the arguments of counsel, the [cjourt finds this case was removed from the Sangamon County [cjircuit [cjourt to the U.S. Bankruptcy Court for the Central District of Illinois on July 17, 2001. The [cjourt further finds that pursuant to Rule 9027(c) of the Federal Rules of Bankruptcy Procedure, the removal of the case was effected upon the filing of the [njotice of [rjemoval in the Sangamon County [cjircuit [cjourt on July 17, 2001. The [cjourt further finds that any action in the case by the Sangamon County [cjircuit [cjourt after the case was removed on July 17, 2001[,j to the U.S. Bankruptcy Court for the Central District of II-linois was void and is a nullity. Specifically, the [cjourt further finds that the [pjreliminary [ijnjunction entered by the Sangamon County [cjircuit [cjourt on July 18, 2001, after the case was removed to the U.S. Bankruptcy Court for the Central District of Illinois, was void and is a nullity.\nThe [cjourt hereby orders that the rights and remedies available to the parties prior to the entry of the [pjreliminary [ijnjunction on July 18, 2001[,j are restored without waiver of any rights and remedies available to the parties. The court further orders that the escrow account ordered by the Sangamon County [cjircuit [cjourt to serve as a depository for the deposit of lease payments to the [djefendants be closed and the funds distributed to the [djefendants in accordance with the lease agreements between the parties. The [cjourt further orders, pursuant to Rule 9027(c) of the Federal Rules of Bankruptcy Procedure, that the parties proceed no further in the Sangamon County [cjircuit [cjourt in this case until further order of the [cjourt.\u201d\nOn August 24, 2001, ILBA voluntarily dismissed CCC as a defendant in this case. On September 5, 2001, the bankruptcy court remanded the case to the trial court, upon finding that based on CCC\u2019s dismissal as a party defendant, the bankruptcy court no longer had jurisdiction over the case.\nD. Trial Court Action After Bankruptcy Court Remand\nOn September 11, 2001, ILBA filed in the trial court a motion seeking to reinstate the court\u2019s July 18, 2001, preliminary injunction order. Advanta objected on the ground that it had appealed the bankruptcy court\u2019s September 5, 2001, remand order. (In March 2002, the United States District Court for the Central District of Illinois affirmed the bankruptcy court\u2019s remand order (No. 01 \u2014 3358, March 14, 2002).)\nOn September 19, 2001, Advanta filed in the trial court a motion for substitution of judge as of right, pursuant to section 2 \u2014 1001(a)(2) of the Code (735 ILCS 5/2 \u2014 1001(a)(2) (West 2000)). Following an October 4, 2001, hearing, the court entered an order (1) denying Ad-vanta\u2019s motion for substitution of judge as of right, and (2) enjoining Advanta from prosecuting any action against ILBA members, effective through October 11, 2001, the date set for a hearing on ILBA\u2019s preliminary injunction motion.\nIn November 2001, the trial court entered another order granting a preliminary injunction against the leasing companies. The court also ordered that Advanta \u201cshall take no action to obtain a judgment against any of the ILBA members on the leases, and all payments on the leases shall be placed in an escrow account pending further order by the [cjourt.\u201d This appeal followed.\nII. ANALYSIS\nA. Motions for Substitution of Judge as of Right Under Section 2 \u2014 1001(a)(2) of the Code\nCivil litigants in Illinois are entitled to one substitution of judge without cause as a matter of right. 735 ILCS 5/2 \u2014 1001(a)(2)(i) (West 2000). The trial court must grant a party\u2019s motion for substitution of judge as of right if the motion \u201cis presented before trial or hearing begins and before the judge to whom it is presented has ruled on any substantial issue in the case.\u201d 735 ILCS 5/2 \u2014 1001(a)(2)(ii) (West 2000); Rodisch v. Commacho-Esparza, 309 Ill. App. 3d 346, 350, 722 N.E.2d 326, 329 (1999). Section 2 \u2014 1001(a)(2) of the Code is \u201cto be liberally construed, and where the conditions are met, the trial court has no discretion to deny the request unless it is shown that the motion was made simply to delay or avoid trial.\u201d Sahoury v. Moses, 308 Ill. App. 3d 413, 414, 719 N.E.2d 1157, 1158 (1999). Since the trial court has no discretion to deny a proper motion for substitution of judge as of right, the issue of whether there has been a ruling on a substantial issue in the case presents a question of law and our review is de novo. Rodisch, 309 Ill. App. 3d at 350, 722 N.E.2d at 329. Orders entered after a motion for substitution of judge has been improperly denied are void. Jiffy Lube International, Inc. v. Agarwal, 277 Ill. App. 3d 722, 727, 661 N.E.2d 463, 467 (1996); see also Scroggins v. Scroggins, 327 Ill. App. 3d 333, 336, 762 N.E.2d 1195, 1198 (2002).\nB. Advanta\u2019s Motion for Substitution of Judge as of Right\nAdvanta argues that the trial court erred by denying its motion for substitution of judge as of right. Specifically, Advanta contends that although the court\u2019s July 18, 2001, preliminary injunction order was a substantial order that would ordinarily preclude its granting a motion for substitution of judge as of right, in this case it should not have been the basis for denying Advanta\u2019s motion because it was entered when the trial court did not have jurisdiction and, thus, was void and a nullity. ILBA responds that the court properly denied Advanta\u2019s motion for substitution of judge as of fight because (1) the preliminary injunction order manifested the court\u2019s position on issues in the case, and (2) granting the motion would allow Advanta to forum shop. We agree with Advanta.\nUpon the filing of a sufficient removal petition, the state court\u2019s jurisdiction immediately and totally ceases and that of the federal court immediately attaches. After such removal, only the federal court can restore jurisdiction to the state court. Moubry v. Kreb, 58 F. Supp. 2d 1041, 1047 (D. Minn. 1999). When the cause appears to be removable, it is \u201cthe duty of the state court to recognize the removal and proceed no further\u201d and to yield jurisdiction to the federal court. The state court has no discretion in the matter, and subsequent proceedings therein, except for the order of removal, are void. The state court should not resume consideration of the cause unless and until it is finally decided in the federal court that the cause was not removable. Hunnewell v. Palm Beach County, 786 So. 2d 4, 5-6 (Fla. App. 2000), citing 76 C.J.S. Removal of Causes \u00a7 221, at 1088. Some federal courts hold that a state court\u2019s orders entered after removal are void even if it is later determined that the removal was not proper. See, e.g., Hyde Park Partners, L.P. v. Connolly, 839 F.2d 837, 842 (1st Cir. 1988); Hunnewell, 786 So. 2d at 5 (noting a split of authority on the question).\nIn this case, because the removal took effect on July 17, 2001, the trial court was without jurisdiction to conduct the July 18, 2001, hearing on ILBA\u2019s motion for preliminary injunction. Therefore, the court\u2019s preliminary injunction order is void. As the bankruptcy court explained in its July 31, 2001, order, the parties were entitled to all the rights and remedies which were available to them before the trial court\u2019s July 18, 2001, preliminary injunction order was entered. See Siddens v. Industrial Comm\u2019n, 304 Ill. App. 3d 506, 511, 711 N.E.2d 18, 21 (1999) (a judgment entered by a court lacking subject-matter jurisdiction is void and a void order is \u201ca complete nullity from its inception and has no legal effect\u201d); National Bank of Monmouth v. Multi National Industries, Inc., 286 Ill. App. 3d 638, 640, 678 N.E.2d 7, 9 (1997) (void orders do not change the status of a case). Accordingly, when the federal court remanded the case to the trial court, Advanta was entitled to a substitution of judge as of right under section 2 \u2014 1001(a)(2) of the Code. 735 ILCS 5/2 \u2014 1001(a)(2) (West 2000).\nILBA nevertheless contends that the trial court properly denied Advanta\u2019s motion for substitution of judge as of right because Advanta allegedly engaged in \u201cforum shopping\u201d when it knowingly filed a defective removal petition and then \u201ctested the waters\u201d by appearing at the July 18, 2001, hearing to defend against ILBA\u2019s motion for a preliminary injunction, all the while knowing that the case would be remanded to the trial court. ILBA\u2019s contention is belied by the fact that Advanta defended against ILBA\u2019s motion on the merits only after objecting to the trial court\u2019s jurisdiction. In addition, the bankruptcy court did not remand the case due to a deficiency in the removal. Rather, it remanded the case after ILBA dismissed CCC as a defendant, which left the bankruptcy court without jurisdiction over the remaining parties, none of which were bankruptcy debtors.\nMoreover, a movant\u2019s right to substitution of judge as of right is absolute, and the trial court does not have discretion to consider whether the movant had an opportunity to \u201ctest the waters.\u201d See Scroggins, 327 Ill. App. 3d at 336, 726 N.E.2d at 1198 (holding that the current version of section 2 \u2014 1001(a)(2) of the Code does not require consideration of the movant\u2019s motivation or opportunity to \u201ctest the waters\u201d).\nWe are similarly unpersuaded by ILBA\u2019s contention that Advanta forfeited the right to object to the trial court\u2019s jurisdiction at the July 18, 2001, hearing by appearing and arguing against ILBA\u2019s motion for preliminary injunction on the merits. All of the cases ILBA cites in support of this argument relate to personal jurisdiction, not subject-matter jurisdiction. Segers v. Industrial Comm\u2019n, 191 Ill. 2d 421, 427, 732 N.E.2d 488, 492 (2000).\nBecause the trial court\u2019s July 18, 2001, preliminary injunction order is void and a nullity, it cannot be considered a \u201csubstantial ruling\u201d in the case under section 2 \u2014 1001(a)(2)(ii) of the Code, and the court erred by denying Advanta\u2019s motion for substitution of judge as of right. Accordingly, we reverse the court\u2019s order denying Advanta\u2019s motion for substitution of judge as of right. We also reverse the court\u2019s October and November 2001 orders granting ILBA injunctive relief. See Scroggins, 327 Ill. App. 3d at 336, 762 N.E.2d at 1198 (reversing the trial court\u2019s orders entered after it improperly denied a motion for substitution of judge as of right).\nIn light of our decision on this issue, we need not address Advan-ta\u2019s other claims of error.\nIII. CONCLUSION\nFor the reasons stated, we reverse the trial court\u2019s orders (1) denying Advanta\u2019s motion for substitution of judge as of right and (2) granting ILBA injunctive relief, and we remand for further proceedings.\nReversed and remanded.\nKNECHT and COOK, JJ., concur.",
        "type": "majority",
        "author": "JUSTICE STEIGMANN"
      }
    ],
    "attorneys": [
      "Lance T. Jones (argued), of Law Offices of Lance T. Jones, of Springfield, and David E. Stern and Colleen K. Lynch, both of Wolf, Block, Schorr & Solis-Cohen, L.L.P, of Philadelphia, Pennsylvania, for appellants.",
      "Scott C. Helmholz (argued), of Sorling, Northrop, Hanna, Cullen & Cochran, Ltd., of Springfield, for appellee."
    ],
    "corrections": "",
    "head_matter": "ILLINOIS LICENSED BEVERAGE ASSOCIATION, INC., Indiv. and on Behalf of its Members, Plaintiff-Appellee, v. ADVANTA LEASING SERVICES et al., Defendants-Appellants (Preferred Capital, Inc., et al., Defendants).\nFourth District\nNo. 4\u201401\u20140998\nArgued May 15, 2002.\nOpinion filed July 26, 2002.\nRehearing denied October 10, 2002.\nLance T. Jones (argued), of Law Offices of Lance T. Jones, of Springfield, and David E. Stern and Colleen K. Lynch, both of Wolf, Block, Schorr & Solis-Cohen, L.L.P, of Philadelphia, Pennsylvania, for appellants.\nScott C. Helmholz (argued), of Sorling, Northrop, Hanna, Cullen & Cochran, Ltd., of Springfield, for appellee."
  },
  "file_name": "0927-01",
  "first_page_order": 945,
  "last_page_order": 952
}
