Post Authored by Laura Wibberley

Counterclaims and affirmative defenses are too often confused by practitioners. However, the Illinois Supreme Court recently established in a unanimous opinion that it is essential for practitioners to plead these correctly. See Carmichael v. Union Pacific R.R. Co., 2019 IL 123853.

Under Illinois law, both counterclaims and cross-claims are considered counterclaims. 735 ILCS 5/2-608 (West 2010). A counterclaim is an independent and substantive cause of action that must be both legally and factually sufficient to set forth a recognized cause of action. Carmichael, 2019 IL 123853 at ¶ 26 (citing Nuccio v. Chi. Commodities, Inc., 257 Ill. App. 3d 437, 443 (1993)).  The counterclaim must also make a specific prayer for relief. Carmichael, 2019 IL 123853 at ¶ 27. Simply put, a counterclaim is a separate and distinct cause of action against another party in the lawsuit. Remember that Illinois fact pleading requirements apply to a counterclaim. Id. at ¶ 26.

Section 2-608 of the Illinois Code of Civil Procedure governs counterclaims and provides:

(a) Any claim by one or more defendants against one or more plaintiffs, or against one or more codefendants, whether in the nature of setoff, recoupment, cross claim or otherwise, and whether in tort or contract, for liquidated or unliquidated damages, or for other relief, may be pleaded as a cross claim in any action, and when so pleaded shall be called a counterclaim.

(b) The counterclaim shall be part of the answer, and shall be designated as a counterclaim. Service of process on parties already before the Court is not necessary.

(c) Every counterclaim shall be pleaded in the same manner and with the same particularity as a complaint, and shall be complete in itself, but allegations set forth in other parts of the answer may be incorporated by specific reference instead of being repeated.

(d) An answer to a counterclaim and pleadings subsequent thereto shall be filed as in the case of a complaint and with like designation and effect.

735 ILCS 5/2-608 (emphasis added).

In contrast, an affirmative defense is a defense that, if proven, would mitigate or eradicate the defendant’s negligent conduct alleged in the complaint. An affirmative defense is not a separate cause of action. A helpful tip is to remember that an affirmative defense cannot stand on its own if the complaint is dismissed. Section 2-613 of the Code of Civil Procedure outlines examples of affirmative defenses, including payment, release, discharge, fraud, duress, laches, and statute of frauds. 735 ILCS 5/2-613. Practitioners need to also remember that if a party files an affirmative answer, the opposing party must file a reply, or the affirmative defenses will be deemed admitted. 735 ILCS 5/2-602.

In a recent decision, the Illinois Supreme Court made it clear that the consequences for failing to properly distinguish between an affirmative defense and a counterclaim can be severe. In Carmichael, Union Pacific Railroad contracted with Public Transportation to transport its employees to various job sites. Carmichael, 2019 IL 123853 at ¶ 27. While the plaintiff, an employee of Union Pacific Railroad, was riding Public Transportation’s transport vehicle, the vehicle was struck by a third-party causing the plaintiff to suffer injuries. Id. at ¶2. The plaintiff brought a declaratory judgment action alleging that Public Transportation, among other defendants, should be found legally responsible for her injuries. Id. at 2-3. Plaintiff alleged that Public Transportation did not carry an insurance policy with the minimum coverage amounts as required under Illinois law. Id. at ¶ 5. In response, Public Transportation filed multiple affirmative defenses alleging the Illinois insurance statute was unconstitutional. Id. Public Transportation also filed a counterclaim restating its constitutional claims and requested the court to declare these statutory provisions unconstitutional in the prayer for relief.  Id. at ¶ 12. The trial court dismissed the counterclaim with prejudice, and Public Transportation appealed. Id. at ¶ 26.

The Illinois Supreme Court chastised the parties because the “counterclaim” was not a true counterclaim. It also refused to discuss the constitutionality of the statutory provision. The “counterclaim” did not request any affirmative relief, but only sought to defeat plaintiff’s claim by alleging a defense of unconstitutionality. Id. at ¶ 31. This was an affirmative defense, not a counterclaim. Id.

The Illinois Supreme Court highlighted that because the lower courts and parties confused the affirmative defense for a counterclaim, Public Transportation was awarded appeal rights to which it was otherwise not entitled. Id. at ¶¶ 34 – 35. Lower court orders simply denying a motion to dismiss are neither final nor appealable. Id. The Court refused to reward Public Transportation for circumventing the normal appeal process and remanded to allow it to proceed on its affirmative defenses. Id. at ¶¶ 36 -37. Thus, the Illinois Supreme Court made it clear that practitioners and courts need to decipher between affirmative defenses and counterclaims.

In order to avoid chastisement from the Court, practitioners should exercise caution when pleading affirmative defenses and counterclaims. Ask: Is this alleging a separate and independent cause of action? Does this request specific relief? If yes, then it is a counterclaim. Remember, Illinois pleading requirements apply to counterclaims.

About the Author:

Laura Wibberley was recently admitted to practice law in the state of Illinois. She concentrates her practice in the areas of medical malpractice and health care defense. Laura received her J.D. from The John Marshall Law School in 2017, where she graduated Valedictorian and summa cum laude.  While in law school, Laura was a student publications editor of the John Marshall Law Review and an associate justice board member of the Moot Court Honor Society. She received the CALI award in Evidence, Civil Procedure, and Contracts. She previously externed with The Honorable Robert E. Gordon of the First District Appellate Court of Illinois where she assisted with the research and drafting of several published opinions. Prior to law school, Laura worked as a senior paralegal for the Chicago Transit Authority in the civil litigation division where she actively participated in over twenty jury trials.