June 10, 2026|Franchise Frontlines
June 10, 2026 | Appellate Court of Illinois, First District, Third Division | Not Reported in N.E. Rptr. — Rule 23 Unpublished Order (2026 IL App (1st) 240874-U, 2026 WL 1683183)
Executive Summary
In an unpublished Rule 23 order not precedential except as allowed under Rule 23(e)(1), Presiding Justice Martin, joined by Justices Rochford and Reyes, delivered the judgment of the Appellate Court of Illinois, First District, Third Division, reversing the Circuit Court of Cook County and vacating a $7 million jury verdict. The issue was whether, as a matter of Illinois law, the Chicago Housing Authority (CHA) owed a duty of care to plaintiff Joseph Taylor, a bystander struck by a shot fired by a security guard employed by AGB Investigative Services, Inc. (AGB), the independent contractor CHA retained for security services. Taylor argued that CHA owed him a duty because its contract with AGB required guards to have three years of prior experience, and that CHA retained supervisory control over AGB’s work; CHA argued that the experience requirement was an internal policy creating no legal duty, that Taylor’s injury was not reasonably foreseeable, and that it did not retain operational control over its independent contractor. The court held that CHA was entitled to judgment notwithstanding the verdict, concluding that the contractual requirement did not create a duty owed to Taylor, that his injury was not a reasonably foreseeable consequence of any failure to enforce that requirement, and that CHA neither was negligent in hiring AGB nor retained the operative control necessary to trigger the retained-control exception to the independent-contractor rule.
Relevant Background
The Chicago Housing Authority contracted with AGB Investigative Services, Inc. to provide security-guard services at CHA properties. AGB employed Carl McLaurin, whom AGB hired in 2017 and assigned to roving patrol; McLaurin held the state licenses required of an armed security guard (a PERC and a FOID card) but had no prior security experience before joining AGB and, on the dates reflected in AGB’s audit file, lacked the three years of prior experience the CHA-AGB contract specified. AGB performed all human-resource functions, McLaurin’s supervisor and that supervisor’s superiors were all AGB employees, and CHA’s Deputy Chief testified that CHA ‘manages the contract’ but did not manage guard hiring or verify credentials.
On January 4, 2019, McLaurin and another AGB guard, while en route to a CHA property, stopped at an intersection where they observed occupants of a Kia fire gunshots. They followed the Kia onto the Dan Ryan Expressway and pursued it a considerable distance until it crashed near an intersection with no connection to CHA. After an occupant pointed a handgun at a motorist, McLaurin exited his vehicle, drew his handgun, and fired twice; one bullet struck Taylor, who was seated in his vehicle at a nearby Wendy’s. The bullet fragment lodged near a nerve in Taylor’s skull and, per medical judgment, was not removed.
Taylor sued CHA, AGB, and McLaurin for negligence, settled with AGB and McLaurin, and proceeded to trial against CHA. Over CHA’s objection that the theory premised liability on ‘internal policies that can’t form a duty,’ the trial court gave Taylor’s pattern instruction allowing the jury to find CHA negligent for, among other things, failing to enforce its own minimum experience requirement and failing to manage AGB. The jury returned a $7 million verdict; the trial court denied CHA’s motion for judgment notwithstanding the verdict, reasoning that CHA had waived any no-duty argument by agreeing to a general duty-of-ordinary-care instruction, and CHA appealed.
Decision
Reviewing the denial of judgment n.o.v. de novo, the court explained that such judgment is proper only where the evidence, viewed most favorably to the nonmovant, ‘so overwhelmingly favors the movant that no contrary verdict based on that evidence could ever stand,’ and that in a negligence action it is appropriate where the plaintiff fails to prove an essential element. Because ‘the existence of a duty is a question of law’ for the court rather than the jury, the court first rejected Taylor’s threshold arguments that CHA had waived or forfeited the duty issue: agreeing to the general ordinary-care instruction (IPI Civil No. 10.04) did not concede a duty, because that instruction ‘does not inform the jury whether and under what circumstances a defendant owes a duty to protect plaintiff against [conduct] by a third person,’ and neither the aider-by-verdict doctrine (which concerns the sufficiency of a complaint, not the trial proof) nor the omission of the precise arguments from CHA’s posttrial motion barred review.
On the merits, the court held that CHA’s contractual requirement that guards have ‘excellent prior experience and a minimum of three years of providing security service’ was an internal policy that did not create a duty owed to Taylor. Under Illinois law, ‘[w]here the law does not impose a duty, one will not generally be created by a defendant’s rules or internal guidelines,’ and ‘a duty is not created by internal policies reflected in a contract’ (quoting Rhodes v. Illinois Central Gulf R.R. and citing Schweihs v. Chase Home Finance LLC). Because Taylor was ‘neither a party to nor an intended beneficiary of the contract,’ any failure to ensure compliance was relevant only to a possible breach, not to the existence of a duty. Turning to foreseeability, the court found no evidence that McLaurin acted as he did because he lacked three years of experience, or that a more experienced guard would have acted differently, deeming ‘the connection between McLaurin’s qualifications and Taylor’s injury’ to be ‘purely conjectural.’
The franchise-relevant core of the opinion is the court’s treatment of Bruntjen v. Bethalto Pizza, LLC, on which Taylor relied. In Bruntjen, the Fifth District had found that a pizza franchisor, Imo’s, owed a duty of care to a person injured by a franchisee’s delivery driver whose record of moving violations should have disqualified him under the franchisor’s written policy. The court distinguished Bruntjen on the ground that the franchisor’s failure to enforce its driver policy ‘was not the sole basis’ for the foreseeability finding; rather, Imo’s had ‘contributed to the risk of harm’ by establishing an unusually large delivery area, requiring timely delivery, and ‘creating a financial incentive to young drivers to drive at unsafe speeds,’ making it foreseeable that ‘delivery drivers would sacrifice safety for speedy deliveries.’ Here, by contrast, Taylor pointed to ‘no conduct on CHA’s part that encouraged McLaurin to pursue fleeing suspects,’ and there was no ‘comparable nexus’ between a three-year experience requirement and the injury, because the shooting had no connection to a CHA resident or property and McLaurin’s pursuit fell ‘outside the duties contemplated in the CHA-AGB contract.’
Finally, the court held that even if the injury were foreseeable, CHA’s liability for the acts of an independent contractor was limited by law to circumstances Taylor failed to establish. Under Pippin v. Chicago Housing Authority and section 411 of the Restatement (Second) of Torts, CHA’s voluntary undertaking to hire a security contractor exposed it to liability only for negligence ‘in engaging’ the contractor, which Taylor did not prove. And under the retained-control exception of section 414, recognized in Carney v. Union Pacific R.R., a ‘general right to enforce safety’ or to inspect and receive reports ‘does not amount to retained control’; the inquiry is whether the hiring entity controlled ‘the details and methods’ of the contractor’s work. The evidence showed AGB alone controlled guard qualifications, training, supervision, equipment, discipline, and procedures—so the Deputy Chief’s statement that CHA ‘manages the contract,’ ‘taken alone,’ was ‘insufficient to prove control.’ Finding no duty on any theory, the court reversed and vacated the judgment.
Looking Forward
Although no franchisor was a party and the case arose in the security-contractor context under Illinois law, the opinion is notable for the franchise practitioner precisely because the court engaged—and distinguished—a franchisor duty precedent, Bruntjen v. Bethalto Pizza, in the course of rejecting an internal-policy theory of duty. This court’s reasoning may inform how courts elsewhere approach the recurring plaintiff argument that a principal’s contractual specification imposed on an independent operator—a training standard, hiring qualification, or safety protocol—becomes a freestanding tort duty owed to the public. On this record, the court held that specifying such a requirement in a contract, where the injured plaintiff is ‘neither a party to nor an intended beneficiary,’ bears only on possible breach, not on the existence of a duty. Defense counsel may find the decision persuasive, though as an unpublished Rule 23 order it is not precedential and its reasoning would be advanced only by analogy outside Illinois.
The Bruntjen distinction is worth close attention because it cuts in a defense-favorable direction while also marking the outer edge. The court read Bruntjen to turn not on the franchisor’s mere failure to enforce a policy but on affirmative franchisor conduct—an oversized delivery area, timeliness demands, and financial incentives—that allegedly encouraged the very risk that materialized. The lesson a franchisor or branded system might draw is cautionary: a system that both sets a standard and layers on operational pressures that could foreseeably push operators toward unsafe conduct may present a materially different foreseeability posture than one that specifies results-oriented qualifications and leaves the means of performance to the operator. On this record the court found no CHA conduct ‘that encouraged’ the guard’s out-of-scope pursuit, and no ‘comparable nexus’ between the qualification and the harm; how a given system’s incentives are structured could affect whether a court draws the same line.
The court’s retained-control analysis may likewise inform franchisor defenses to control-based and vicarious-liability theories. Consistent with section 414 and Carney, the court treated a ‘general right’ to inspect, receive reports, and enforce safety as insufficient, focusing instead on who controlled the ‘details and methods’ of the work—here, AGB, which handled hiring, licensure, training, supervision, discipline, equipment, and procedures. Franchisors and branded systems may reasonably continue to set brand and quality standards while leaving day-to-day means and methods, including hiring and supervision, to the independent operator, recognizing that the persuasive force of an argument like CHA’s often turns on whether that separation holds up in actual practice as well as on paper. As always, these are defense-side observations drawn from a single unpublished Illinois order; their transfer to franchise systems in other jurisdictions is analogous and persuasive, not controlling.
Thomas O’Connell is a Partner at Buchalter LLP and Chair of the firm’s Franchise Practice Group. For questions about this article or media inquiries, you can contact Tom at toconnell@buchalter.com.
This article is based solely on the opinion of the Court in this matter. The author has not conducted any independent investigation into the facts. For the avoidance of doubt, each statement related to the law and facts in this article is drawn from the Court’s opinion in this case. It was drafted with the assistance of an artificial intelligence system. AI systems can make mistakes, including in describing legal authority. Readers should independently confirm any legal authority before relying on it.
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