                                  Illinois Official Reports

                                          Appellate Court



                      Hiatt v. Western Plastics, Inc., 2014 IL App (2d) 140178



Appellate Court              MICHAEL HIATT, Plaintiff-Appellant, v. WESTERN PLASTICS,
Caption                      INC., NATIONAL RUBBER STAMP COMPANY, INC.,
                             NATIONAL    RUBBER        MACHINE,        TRY-R-ELECTRIC
                             COMPANY, CHINA NATIONAL RUBBER MACHINERY
                             CORPORATION, GENERAL BINDING CORPORATION,
                             AMERICAN C.N.C. MACHINE COMPANY, INC., and LEONARD
                             HOFKAMP, Defendants (Illinois Tool Works, Inc., Defendant-
                             Appellee).


District & No.               Second District
                             Docket No. 2-14-0178


Filed                        December 29, 2014


Held                         In an action arising from plaintiff’s loss of his arms while cleaning an
(Note: This syllabus         extruding machine wherein plaintiff sued his employer and several
constitutes no part of the   other defendants related to the machine, all but one of which had been
opinion of the court but     dismissed or had entered into settlement agreements with plaintiff, the
has been prepared by the     trial court erred in entering summary judgment for the remaining
Reporter of Decisions        defendant, which operated one of its divisions next door to plaintiff’s
for the convenience of       employer and sold products produced by plaintiff’s employer based on
the reader.)                 the finding that it was not engaged in a joint venture with plaintiff’s
                             employer and owed no duty of care to plaintiff, since a genuine issue
                             of material fact existed as to whether plaintiff’s employer and the
                             remaining defendant were engaged in a joint venture; therefore, the
                             trial court’s judgment was reversed and the cause was remanded for
                             further proceedings.


Decision Under               Appeal from the Circuit Court of Du Page County, No. 11-L-306; the
Review                       Hon. Dorothy French Mallen, Judge, presiding.
     Judgment                 Reversed and remanded.



     Counsel on               Devon C. Bruce, of Powers, Rogers & Smith, P.C., of Chicago, for
     Appeal                   appellant.

                              J. Kent Mathewson, Karen Kies DeGrand, and Timothy L. Hogan, all
                              of Donohue, Brown, Mathewson & Smyth LLC, of Chicago, for
                              appellee.



     Panel                    JUSTICE ZENOFF delivered the judgment of the court, with opinion.
                              Justice Spence concurred in the judgment and opinion.
                              Justice Burke dissented, with opinion.



                                               OPINION

¶1         Plaintiff, Michael Hiatt, was an employee of Western Plastics, Inc. (Western), which uses
       extruding machines to produce plastic sheets. The machines heat plastic pellets into a putty
       form and then push the material through metal rollers to create plastic sheets of desired
       thicknesses. On October 15, 2007, while cleaning one machine’s spinning rollers, plaintiff’s
       arms were crushed between the rollers and had to be amputated. Plaintiff sued Western and
       other defendants, all but one of which either have been dismissed or have entered into
       settlement agreements with plaintiff. The only remaining defendant, Illinois Tool Works, Inc.
       (ITW), operated one of its divisions next door to Western and sold products that Western
       produced. Plaintiff alleged that ITW was liable to him because it either (1) was engaged in a
       joint venture with Western, (2) retained control over Western, giving rise to a duty of care, or
       (3) had actual or constructive knowledge that the extruding machine was unreasonably
       dangerous. The trial court entered summary judgment in ITW’s favor, finding that it was not
       engaged in a joint venture with Western and owed no duty of care to plaintiff. For the
       following reasons, we reverse and remand.

¶2                                        I. BACKGROUND
¶3         Count IV of plaintiff’s sixth amended complaint alleged as follows. ITW and Western
       were engaged in a joint venture to manufacture and sell plastic products. They shared profits
       and losses and exercised joint control and management of the manufacturing process, and
       they both contributed money, resources, equipment, and employees to the venture. ITW
       controlled the manner in which Western manufactured its products, including the pace and
       speed of the extruding machines. ITW knew that the extruding machine that injured plaintiff
       was unreasonably dangerous in that it lacked a proper emergency stopping mechanism and
       other safety devices. ITW was negligent individually and as a joint venturer with Western, in


                                                  -2-
       that it allowed plaintiff to work on an unreasonably dangerous machine, failed to provide
       adequate warnings and instructions, failed to provide adequate safety devices, and failed to
       identify and correct safety hazards. ITW’s acts or omissions proximately caused plaintiff’s
       injuries.
¶4         ITW moved for summary judgment on count IV, contending that there was no genuine
       issue of material fact as to whether it was engaged in a joint venture with Western, retained
       control over the manufacturing process, or knew that the extruding machine that injured
       plaintiff was unreasonably dangerous. Rather than recite ITW’s and plaintiff’s arguments in
       support of and in opposition to summary judgment, which in essence are the same arguments
       they make on appeal, we summarize the deposition testimony and documentary evidence.

¶5                                     A. Don Edelstein’s Deposition
¶6         Don Edelstein testified as follows. He had been part owner of Western since 1977, when
       he and three other individuals started the company. Originally, Edelstein worked as a
       machine operator at Western. In 1986 or 1987, his primary responsibility became machine
       maintenance, which remained his responsibility at the time of plaintiff’s accident.
¶7         In 1999, Western built its third extruding machine, which was the machine that injured
       plaintiff. The machine was a clone of Western’s other extruding machines. Western
       purchased the components for the machine from various entities, and Edelstein assembled the
       components, hiring an electrician and a welder for some of the work. At Edelstein’s
       direction, the electrician, Leonard Hofkamp, installed an emergency stop cord on the
       machine exactly as the stop cords were installed on Western’s other machines. Edelstein
       estimated that 95% of the plastic that Western produced on its third extruding machine was
       for ITW. However, ITW played no role in the design or construction of the machine. Other
       than plaintiff’s, no injuries had occurred on the machine.
¶8         ITW was Western’s biggest customer. At the time of the accident, ITW accounted for
       70% to 80% of Western’s business. Although ITW was headquartered elsewhere, it had a
       facility next door to Western, in the same building. ITW and Western were separated by a
       wall and shared a loading dock. Edelstein believed that ITW moved into the building to
       reduce shipping costs, because most of the material that it sold came from Western.
¶9         A written manufacturing agreement governed the relationship between Western and ITW.
       Broadly speaking, Western’s intent upon entering into the agreement was to sell more
       products and increase profits. Western did not have written agreements with any of its other
       customers.
¶ 10       ITW supplied to Western the plastic pellets used to produce ITW’s products. The pellets
       used a proprietary formula that ITW owned. In addition, ITW supplied some of the pallets
       used to ship its products and the labels to be placed on its products. The manufacturing
       agreement contained a formula for setting the price at which Western would sell products to
       ITW, based on the number of pounds of product manufactured. For customers other than
       ITW, Western supplied the raw material and the pallets. The price of products for customers
       other than ITW was based on the number of plastic sheets produced, not on weight.
¶ 11       Edelstein testified that ITW owned electronic monitoring devices that were installed on
       two of Western’s extruding machines. The devices measured the thickness of the plastic
       sheets as they were produced. The devices were capable of controlling the speed of the


                                                 -3-
       machines. When an extruding machine was set to “manual,” the machine operator controlled
       the speed. When an extruding machine was set to “automatic,” the monitoring device
       controlled the speed. When Western manufactured material for ITW, the machines were set
       to automatic. Although the monitoring devices were capable of controlling a machine’s
       speed, ITW was unable to control the speed from its office. Instead, based on information
       that ITW provided, Western had programmed tolerances into the monitoring devices. The
       devices regulated each machine’s speed to ensure that it produced material within the
       tolerances. For each roll of plastic produced, the monitoring devices also relayed the
       tolerances to ITW, which received a printout of the information. A wire from the devices ran
       through the wall into ITW’s office. ITW incurred the expense of purchasing, installing, and
       maintaining the devices.
¶ 12       Upon further questioning, Edelstein clarified that there were two major components of
       each extruding machine–the portion “where the plastic is extruded” and the “downstream”
       portion, which contained the rollers that injured plaintiff. The monitoring devices were
       installed on and controlled the speed of the downstream portion of the machines. The speed
       of that portion affected the thickness of the plastic sheets being produced.
¶ 13       The monitoring device on the machine that injured plaintiff was not “activated” at the
       time of the accident, because the downstream portion of the machine had been separated
       from the extruder portion and plaintiff was standing between the two sections, cleaning the
       rollers on the downstream portion. When the two portions of the machine were separated, no
       material could move through the machine, and the monitoring device could not control the
       speed of the machine.
¶ 14       None of Western’s other customers had monitoring devices installed on its machines like
       ITW did. However, like ITW, Western’s other customers provided specifications for the
       thickness of the plastic sheets and rolls that they ordered.
¶ 15       Edelstein testified that Richard Pedersen worked as a “broker” for ITW and would enter
       Western on a daily basis to pick up completed orders. Pedersen did not have keys to Western.
       In addition to picking up completed orders, Pedersen helped with scheduling ITW’s orders.
       Pedersen would create a schedule based on the thickness of the materials to be produced. The
       schedule ensured that Western did not “lose production,” as Western could produce products
       with the same thickness at the same time. Other than Pedersen, ITW employees occasionally
       came to Western for other reasons, for instance, if there was a quality issue that needed to be
       addressed. This happened “maybe a half a dozen times over the years,” possibly more.

¶ 16                                   B. Chris Benson’s Deposition
¶ 17       Chris Benson testified as follows. He began working for ITW in 1986 in its Fastex
       division, which was located in Des Plaines, Illinois. In 1996, the Formex product line became
       part of the Fastex division. Formex is a flame-retardant polypropylene electrical insulation
       that is used in various electrical components. In 2000 or 2001, the Formex line was split off
       from the Fastex division and became a separate division of ITW. At that time, the Formex
       division moved into the space next to Western in Addison, Illinois. Western manufactured
       the Formex products.
¶ 18       Benson was responsible for, among other things, ordering raw material and issuing
       purchase orders to Western. When Benson issued a purchase order to Western, he identified


                                                  -4-
       the products he was ordering by part number and specified a quantity. The manufacturing
       agreement between ITW and Western contained the specifications for each product. The
       specifications consisted of a desired thickness, the acceptable tolerances, and the acceptable
       quality. Tolerances referred to the acceptable range above and below the specified thickness.
       Quality was measured by counting the number of defects in a given roll of plastic sheet.
       Purchase orders were issued to Western approximately twice per month.
¶ 19       Benson testified that, between 2001 and 2007, he entered Western “[m]aybe a couple
       times a year.” He did not have a key to Western. He would go there if there was a question
       about manufacturing or quality. For example, if Western wanted ITW’s approval for a certain
       “surface appearance” of a product, Benson would go to Western to view the product.
¶ 20       Benson testified that Pedersen was an independent salesperson who introduced ITW to
       Western in approximately 1992. In 2000, Pedersen began working as an independent
       contractor for ITW, handling shipping and quality control. In that role, Pedersen worked 40
       hours per week. He had a desk and a phone in ITW’s office. His duties included delivering
       ITW’s purchase orders to Western, helping Western determine a production schedule for
       ITW’s orders, and picking up the finished products from Western using a forklift. He
       transported the finished products to ITW’s warehouse, where they would be loaded onto
       trucks and shipped to customers. When Pedersen did these tasks, he was acting on ITW’s
       behalf.
¶ 21       When asked about which costs ITW was responsible for with respect to products that
       Western manufactured for ITW, Benson testified that ITW purchased the raw material, the
       labels, and approximately 10% of the pallets used to ship the finished products. ITW supplied
       a portion of the pallets because they were of a size that Western did not have available. In
       addition, on two or three occasions, ITW contributed funds toward refinishing the rollers on
       the extruding machines used to produce ITW’s products. The refinished rollers ensured that
       ITW products had a consistent thickness. On one occasion, ITW incurred the cost of new
       rollers.
¶ 22       Benson testified that Western was not the only company manufacturing products for
       ITW’s Formex division. A company called Film Tech produced a thin-gauge plastic for ITW
       that Western was not capable of producing. However, between 2001 and 2007, Western
       produced approximately 95% of the products that ITW’s Formex division sold.
¶ 23       Addressing the manufacturing agreement between ITW and Western, Benson testified
       that it was entered into “to explain the way we would carry on our business dealings with
       each other.” When asked how many times ITW had instructed Western to make changes to
       the manufacturing process, as the agreement authorized it to do, Benson testified, “Rarely, if
       it all.” However, Benson testified that ITW “frequently” exercised its right under the
       agreement to inspect the finished products at Western prior to receipt, which it did through
       Pedersen. Benson explained that, if Pedersen observed a defect in a sheet of plastic coming
       out of an extruding machine, Pedersen had “the right to tell the operator something need[ed]
       to be done.” It then fell within the operator’s discretion to remediate the problem. Benson
       estimated that this happened “rarely,” which meant “[m]aybe monthly.”
¶ 24       Benson testified that the monitoring devices were installed on Western’s extruding
       machines “[p]rimarily for data acquisition for quality control purposes.” Benson clarified that
       there were two types of monitors. The monitors attached to the machines constantly
       monitored the thickness of the plastic being manufactured. These monitors controlled the

                                                  -5-
       speed of each machine to ensure that the plastic was being produced at the proper thickness.
       The monitor in ITW’s office, which was connected to the monitors on the machines, solely
       acquired data. For each roll of plastic produced, the monitor in ITW’s office acquired the roll
       number, the part number, the length of the roll, the thickness of the plastic, and the date and
       time of production. No one monitored the data as it was received; it was stored for
       record-keeping purposes. Explaining the benefit of the monitors, Benson testified that ITW
       received a consistent product, which increased ITW’s sales and which, by virtue of ITW’s
       agreement with Western, increased Western’s sales.

¶ 25                               C. Lawrence Lezon’s Deposition
¶ 26       Lawrence Lezon testified that he worked for ITW from 1986 to 2006 and was the general
       manager of the Formex division. The Formex division moved into the space next to Western
       in 1999 or 2000 because it needed an office and a warehouse. The advantage of locating next
       door to Western was that ITW did not have to truck the finished products to a different
       location.
¶ 27       Lezon testified that Pedersen was not an ITW employee but that he had an office in
       ITW’s facility. Pedersen acted as a “one-person shipping department” for ITW. He also acted
       “as the go-between” for ITW and Western and delivered orders to Western.
¶ 28       Lezon recalled that Pedersen introduced him to Ray Howard at Western prior to 1993.
       Lezon knew Pedersen because Pedersen had worked for one of ITW’s suppliers. However,
       that supplier was not producing ITW’s products to its specifications. Pedersen left that
       supplier and became an independent sales representative. Pedersen told Lezon that he
       thought Western was capable of manufacturing ITW’s products, and he and Lezon toured
       Western’s facility. In 1993, Lezon and Howard negotiated the manufacturing agreement,
       using attorneys. Lezon would go to Western “maybe once a month,” usually for
       “smoozing [sic]” with Howard.
¶ 29       Lezon testified that ITW requested that the monitoring devices be installed on Western’s
       machines because ITW was receiving complaints from its customers regarding thickness
       variations within each roll of plastic. ITW had customers around the world, so it was
       expensive for orders to be returned. The devices ensured that the products had a consistent
       thickness.

¶ 30                                    D. Pedersen’s Deposition
¶ 31       Pedersen testified that he held a variety of positions in the plastics industry prior to 1989,
       at which time he became an independent salesperson. His company was called Quest Sales
       and Marketing, and Pedersen was its only employee. Through his company, Pedersen
       matched up customers with plastics manufacturers. Western was the only customer Pedersen
       and his company had remaining. He never had a written agreement with Western, but he did
       receive a sales commission from Western based on the number of pounds of product
       produced.
¶ 32       Pedersen had been familiar with ITW since 1988. In 1990 or 1991, he began looking for a
       custom extruder capable of producing material for ITW. He met Howard at Western and then
       introduced him to ITW. Once Western began manufacturing ITW’s products, Pedersen’s role
       was “the representative go-between between the two companies.” He would communicate

                                                   -6-
       ITW’s production needs to Western, get “those to Western *** so that they could set up the
       production,” and then transport the finished products back to ITW. He also performed quality
       control by checking samples from each roll of plastic for proper thickness and for
       imperfections. He shipped the finished products to customers from ITW’s facility.
¶ 33       Pedersen had acted as the “go-between” since 1991, and ITW paid him as an independent
       contractor. Pedersen had an office at ITW, with a computer and a phone. He did not pay rent
       or a phone bill. He was present at ITW five days per week from 7 a.m. to 3:30 p.m.
¶ 34       Pedersen was in Western’s facility on a daily basis. He did not have a key and usually
       would enter through the loading dock that ITW and Western shared. When he found
       imperfections in a finished product, he would voice his concerns to someone at Western, who
       would then remediate the problem. Depending on what the problem was, Western might have
       to stop an extruding machine or adjust the machine. However, Western would determine
       what was necessary to correct the problem. Pedersen would not direct Western to shut down
       a machine. In the past, Pedersen had entered specifications into ITW’s monitoring devices.
       He did so only if a Western employee “had problems” with a device.
¶ 35       Pedersen had witnessed Western’s employees cleaning the extruding machines. He knew
       that they would clean the rollers with a solvent while the rollers were slowly turning.
       Pedersen was not familiar enough with the machines to know what safety devices were
       available to stop a machine if someone was injured during the cleaning process. He stayed
       away from the machines as much as he could because they scared him. During his time
       working in the plastics industry, he had “seen too many people get hurt.”
¶ 36       Pedersen testified that, on a number of occasions over the years, ITW had agreed to incur
       the cost of overtime hours for Western workers when ITW had large orders that needed to be
       completed. In those situations, Western would send ITW an invoice for the extra cost.

¶ 37                                E. Lauren Lavalle’s Deposition
¶ 38       Lauren Lavalle testified that she had worked as a secretary at Western since 1980. Her
       responsibilities included accounts receivable, accounts payable, and office duties. She saw
       Pedersen on a daily basis, when he brought her ITW’s orders. When he delivered orders, he
       would give her labels in the order in which he wanted the products produced. Lavelle would
       then create a production sheet, which was given to the machine operators. The production
       sheet allowed the operators to produce the products without having to make time-consuming
       changes to the machines. Lavalle had seen Benson approximately 10 times in 20 years. Other
       than ITW, which was “by far” Western’s largest customer, Western had approximately 8 to
       10 customers.

¶ 39                                  F. Robert Cobb’s Deposition
¶ 40       Robert Cobb testified that he had been a machine operator at Western since 1985. He saw
       Benson only “[o]nce in a great while” but he saw Pedersen every day. Pedersen was “there
       just like another employee.” Pedersen placed orders for ITW and gave the orders to Lavalle,
       not directly to Cobb. The orders sometimes changed two or three times per day, and Cobb
       would have to adjust the size or the gauge of the plastic he was producing. When he changed
       the product he was producing, he would select the code for that product in ITW’s monitor
       attached to the machine. No one from ITW operated the monitors.

                                                 -7-
¶ 41       Cobb testified that the Formex product left buildup on the rollers that had to be cleaned
       off on a daily basis. To clean the rollers, Cobb would use a rag to wipe them down while they
       were spinning. When product was not running through the machine, Cobb would slow down
       the rollers and reverse their direction before cleaning them. When product was running
       through the machine, Cobb would clean them from the opposite side. Other than plaintiff’s,
       Cobb was not aware of any serious workplace injuries at Western. Cobb had not received any
       training when he started working for Western, because he had been fully trained at his prior
       job, which required him to operate the same kind of extruding machine.

¶ 42                                  G. Timothy Smith’s Deposition
¶ 43       Timothy Smith testified that he had worked as a machine operator at Western since 1983.
       Harold Howard, who was Smith’s cousin, trained Smith and the other employees how to
       operate and clean the machines. There were no written instructions or manuals. On Monday
       mornings, the machine operators had to deep clean the rollers, which took about 10 minutes.
       Plaintiff was cleaning the rollers on a Monday morning when he was injured.
¶ 44       Approximately one week before the accident, Smith observed plaintiff cleaning the
       rollers while they “were running super fast” in the direction “to pull you in.” Smith “yelled at
       him,” slowed down the rollers, and put them in reverse. He told plaintiff that he would get
       plaintiff fired if he cleaned the rollers that way again. On the morning of the accident, after
       plaintiff’s arms had been pulled into the machine, Smith saw that the speed dial was set on
       790, which was “very fast.” The speed dial should have been set on 200 or 300, which was
       “very slow.” Smith had never observed anyone else cleaning the rollers while they were set
       at such a high speed.
¶ 45       Smith testified that, each time a machine operator started a new roll of plastic, he would
       push a button on the ITW monitoring device. When the roll was finished, the operator pushed
       the button again, and the device would print out a report indicating the length and thickness
       of the roll. Smith explained that the device controlled the speed of the rollers only when it
       was turned on and when material was running through the machine. Because no material was
       running through the machine when plaintiff was injured, the monitoring device could not
       have controlled the speed of the rollers.

¶ 46                                 H. Harold Howard’s Deposition
¶ 47       Harold Howard testified that he had worked at Western since 1978 and was its production
       manager, responsible for quality, scheduling, and supervising the machine operators. He
       alone trained plaintiff on how to clean the rollers. He instructed plaintiff to slow the rollers
       down to “two or three or until their [sic] barely moving.” However, he did not instruct
       plaintiff to reverse the spin of the rollers prior to cleaning them. Harold trained all of the
       employees in the same manner. Ray Howard, who was Harold’s uncle, trained Harold on
       how to clean the machines.

¶ 48                                     I. Plaintiff’s Deposition
¶ 49       Plaintiff testified that he worked at Western from 2003 or 2004 until the date of his
       accident, except for being laid off for six months due to a lack of business. He described his
       position as “helper” or “laborer.” He would do the tasks Harold told him to do, such as filling

                                                  -8-
       the hopper with plastic pellets, cleaning the rollers, or taking finished rolls off of the
       machine. Most of the training he received was from Harold, including on how to clean the
       rollers. Some instruction came from Ray Howard. However, there was no written instruction
       at all. Harold instructed him to stand in front of the rollers and to wipe back and forth with a
       rag dipped in solvent while the rollers were spinning in a forward direction. No one
       instructed him regarding the speed at which the rollers should be spinning or told him to slow
       down the rollers.
¶ 50       Plaintiff testified that he was injured on machine number one, which produced
       exclusively ITW’s products. The rollers on machine number one had to be cleaned four to
       five times per eight-hour shift, because the Formex product would build up on the rollers.
       The rollers on machine number two, which produced a different plastic, did not necessarily
       have to be cleaned during each shift, because the product did not build up. When his accident
       occurred, at approximately 7:45 a.m. on a Monday, plaintiff was cleaning the rollers on
       machine number one before it had started producing any material. Plaintiff did not adjust the
       speed dial prior to cleaning the machine. He would touch the speed dial only when someone
       instructed him to do so.

¶ 51                                    J. Manufacturing Agreement
¶ 52       The manufacturing agreement between ITW and Western was dated March 5, 1993, and
       was signed by Lezon of ITW and Ray Howard of Western. Western agreed to accept and fill
       orders from ITW for flame-retardant thermoplastic sheets and to fill those orders pursuant to
       ITW’s specifications and quality control standards. The products and their specifications
       were listed in an exhibit attached to the agreement. Western agreed to have the capacity to
       produce a maximum of 800,000 pounds of sheet products annually. Western further agreed to
       sell the products to ITW at a price calculated pursuant to a formula designated in the
       agreement. The agreement required ITW to provide Western with a “shipment forecast” no
       later than the fifteenth of each month, to allow Western to plan production levels.
¶ 53       The agreement prohibited Western from selling ITW’s products to anyone other than
       ITW. Western also had to return to ITW any scraps generated in the manufacturing process
       or dispose of them per ITW’s instructions. ITW could require Western’s employees to sign
       confidentiality agreements with respect to ITW’s products.
¶ 54       The agreement provided, “For purposes of quality control Western agrees that changes to
       the manufacturing process must receive prior approval of ITW.” It further provided that
       “[s]ubstitution of parts, raw materials, process equipment, or other items must be approved
       by ITW.” ITW also had the authority to inspect the finished products at Western at any
       reasonable time. Western was required to “cooperate with ITW’s designated representative(s)
       in performing such inspections and [to] make any improvements or changes reasonably
       requested by the representative(s).” Any requested changes would be at ITW’s expense.
¶ 55       A section of the agreement entitled “Cost Improvement” provided that Western and ITW
       agreed “to work together to implement cost improvements in processes (excluding the cost of
       raw material) and overhead.” ITW retained the right to approve any improvement “directly
       affecting the Product.” The parties agreed to share equally “the benefits of cost
       improvements” and provided a specific formula:
               “Western and ITW agree to share the benefits of cost improvements as follows:


                                                  -9-
                       Western initiated:
                               50% to Western/50% to ITW
                       ITW initiated:
                               50% to Western/50% to ITW.”
       The “Technology, Designs, Confidentiality” section provided that ITW would “work with
       Western to develop new designs or Products” and may “accept for use *** designs which are
       initiated by Western.” Western agreed that it could not use the resulting designs “for any
       purpose other than manufacture of Products for ITW.”
¶ 56        A section entitled “Independent Contractor” provided that neither party was “the agent of
       the other for any purpose whatsoever.” In addition, it prohibited each party from binding or
       attempting to bind the other party to any contract or obligation with a third party. It provided
       that “[a]ll sales under this Agreement are and shall be between a principal seller and a
       principal buyer.”
¶ 57        The agreement also contained an automatic renewal provision. It provided that the
       agreement would renew automatically for successive periods of one year, unless “written
       notice to the contrary” was received at least 60 days prior to the completion of the current
       term.

¶ 58                                K. Miscellaneous Correspondence
¶ 59       In opposition to ITW’s summary judgment motion, plaintiff submitted a variety of
       correspondence between ITW and Western. In a letter dated September 18, 1992, Benson
       wrote to Ray Howard that he was “pleased” that Western had agreed to “attempt a trial run”
       of ITW’s products. Benson wrote that ITW “look[ed] forward to building a mutually
       beneficial relationship with Western.” On May 23, 1994, which preceded ITW’s move into
       the space next to Western, Benson wrote to Howard that he was “pleased to acknowledge
       Western Plastics as a warehousing facility” for “storage of various finished goods.” He wrote
       that “this type of arrangement helps enable Fastex to function with Western Plastics as a true
       extension of our business.” In correspondence dated November 1, 1994, Benson wrote to
       Howard about upcoming trial runs of new products. He wrote that “[w]e are sure there will
       be mutual benefits for all of us from this type of activity.” On February 15, 1995, Benson
       wrote to Howard regarding the tolerances for various Formex products, and stated that the
       results of Western’s efforts “pleased [ITW’s] customers assuring continued growth for both
       Fastex and Western.”
¶ 60       Some of the letters pertained to sharing the cost of the rollers. In a letter dated January
       26, 1995, Benson wrote to Howard to authorize Western to “have one casting roll reworked”
       and to charge ITW using a “surcharge” of $0.25 per pound on the next 12,000 pounds of
       material produced. On June 18, 1997, Benson wrote to Howard that ITW agreed to pay
       $18,000 for the construction of two new rollers to be used for Formex products, while
       Western agreed to pay for all maintenance of the rollers. Benson acknowledged that Western
       would benefit by saving “a great deal of time on set-ups” and by “substantially reduc[ing] the
       number of roll changes required.” He wrote that ITW would benefit through “improved
       gauge control” and “more economic use of raw material.” He further wrote that “[t]hese
       benefits will be applied in consideration to cost savings for both parties according to section
       15 of the contract,” the “Cost Improvement” section.

                                                  - 10 -
¶ 61                                      L. Trial Court’s Ruling
¶ 62       On January 8, 2014, the trial court granted ITW’s motion for summary judgment. The
       court found that there were no genuine issues of material fact as to at least three of the
       elements required for a joint venture, meaning that ITW was entitled to judgment as a matter
       of law on that issue. The court found that the “easiest element to analyze [was] whether there
       was a sharing of profit and losses.” To that end, it found that there was no evidence that ITW
       and Western “got together at the end of [the] fiscal year *** and did a joint accounting and
       divided *** the profits or losses.” It further found that “cost improvements” impacted profits
       and losses but were not profits or losses themselves. The court also found that there was no
       agreement to carry on a single enterprise. The court described the manufacturing agreement
       as a “typical” one between a manufacturer and a buyer. It also found that ITW’s control over
       production was limited to “the specifications.” The court found that there was evidence of a
       community of interest between ITW and Western, but that this was insufficient to give rise to
       a joint venture.
¶ 63       Next, the court found that there was no genuine issue of material fact as to the issue of
       retained control. The court found that ITW retained no control over the manner or method in
       which its products were produced, as long as its specifications were met. In addition, ITW
       retained no control over safety or how the machines were cleaned.
¶ 64       Addressing the issue of ITW’s knowledge that the extruding machine was unreasonably
       dangerous, the court ruled that, even if it had such knowledge, it did not owe a duty of care to
       plaintiff. The court found that there was no evidence that ITW had “a right or authority” to
       instruct Western on how to train its employees or clean the machines.
¶ 65       Finally, the court found that, even if ITW were engaged in a joint venture with Western,
       the exclusive-remedy provision of the Workers’ Compensation Act (820 ILCS 305/5(a)
       (West 2012)) would prohibit recovery against ITW as Western’s co-venturer.

¶ 66                                         II. ANALYSIS
¶ 67       On appeal, plaintiff argues that three genuine issues of material fact made summary
       judgment in ITW’s favor improper: (1) whether ITW and Western were engaged in a joint
       venture, (2) whether ITW retained control over Western, giving rise to a duty of care to
       plaintiff, and (3) whether ITW’s actual or constructive knowledge that the extruding machine
       was unreasonably dangerous gave rise to a duty to plaintiff. He also contends that the court
       erred in sua sponte ruling that, if ITW were engaged in a joint venture with Western, the
       exclusive remedy provision of the Workers’ Compensation Act would immunize ITW from
       liability.
¶ 68       Summary judgment is appropriate where the pleadings, affidavits, depositions, and
       admissions on file, when viewed in the light most favorable to the nonmoving party, show
       that there is no genuine issue of material fact and that the moving party is entitled to
       judgment as a matter of law. Thompson v. Gordon, 241 Ill. 2d 428, 438 (2011). “Summary
       judgment is a drastic means of resolving litigation and should be allowed only when the right
       of the moving party is clear and free from doubt.” (Internal quotation marks omitted.)
       Sedlacek v. Belmonte Properties, LLC, 2014 IL App (2d) 130969, ¶ 12. We review de novo
       an order granting summary judgment. Thompson, 241 Ill. 2d at 438.


                                                  - 11 -
¶ 69                                         A. Joint Venture
¶ 70       Plaintiff argues that there is a genuine issue of material fact as to whether ITW and
       Western were engaged in a joint venture. He argues that through the manufacturing
       agreement and their conduct the parties expressed their intent to carry on an enterprise. He
       contends that ITW and Western shared profits and losses, as the goal of the joint venture was
       to increase the parties’ profits, and that the parties shared the costs of the manufacturing
       process. He further argues that there was a community of interest, as reflected in ITW’s
       contributions of money, equipment, effort, and skill to the enterprise. Finally, plaintiff
       argues, ITW and Western both enjoyed the right to control and manage the operation, as
       evidenced by the agreement and their conduct.
¶ 71       ITW responds that the manufacturing agreement established the parties’ relationship as
       one of buyer and seller and that it would be improper to infer any contrary intent from their
       conduct. ITW further argues that it did not share profits and losses with Western; rather, both
       parties independently profited from their contractual relationship, and the sharing of costs is
       not synonymous with the sharing of losses. Regarding the right to control and manage the
       manufacturing operation, ITW argues that requiring that its product specifications be met is
       different from controlling and managing the production process.
¶ 72       A joint venture is an association of two or more persons to carry out a single enterprise
       for profit. Fitchie v. Yurko, 212 Ill. App. 3d 216, 226 (1991). Similar to partners in a
       partnership, members of a joint venture are vicariously liable for fellow venturers’ negligent
       acts committed during the course of the enterprise. Barton v. Evanston Hospital, 159 Ill.
       App. 3d 970, 973 (1987); Stone v. Guthrie, 14 Ill. App. 2d 137, 147 (1957). Ordinarily, the
       existence of a joint venture is a question of fact for the trier of fact. O’Brien v. Cacciatore,
       227 Ill. App. 3d 836, 843 (1992).
¶ 73       No formal agreement is necessary to form a joint venture, which can be inferred from the
       parties’ conduct and the facts and circumstances of a given case. Electrical Contractors, Inc.
       v. Goldberg & O’Brien Electric Co., 29 Ill. App. 3d 819, 822 (1975). A joint venture is a
       creation of contract law (Public Electric Construction Co. v. Hi-Way Electric Co., 62 Ill.
       App. 3d 528, 531 (1978)), and whether one exists is a question of the parties’ intent. Fitchie,
       212 Ill. App. 3d at 227. In evaluating that intent, courts look to the following elements: (1) an
       express or implied agreement to carry on an enterprise; (2) a demonstration of intent to be
       joint venturers; (3) a community of interest, as reflected in the contribution of property,
       money, effort, skill, or knowledge; (4) a measure of joint control and management of the
       enterprise; and (5) sharing of profits and losses. Fitchie, 212 Ill. App. 3d at 227. In the
       absence of any one of these elements, no joint venture exists. O’Brien, 227 Ill. App. 3d at
       843.

¶ 74      1. Agreement to Carry on an Enterprise and Demonstration of Intent to be Joint Venturers
¶ 75       Plaintiff contends that the manufacturing agreement between ITW and Western is an
       agreement to carry on a single enterprise producing plastic sheets. He maintains that, despite
       the agreement’s “Independent Contractor” provision, the agreement is not a simple contract
       between a buyer and a seller. He argues that the agreement’s unique provisions and the



                                                  - 12 -
       parties’ conduct create a genuine issue of material fact as to whether ITW and Western
       agreed to carry on an enterprise and demonstrated an intent to be joint venturers.
¶ 76       ITW responds that the agreement’s “Independent Contractor” provision is controlling.
       ITW maintains that, because a joint venture is a creature of contract law, it would be error to
       interpret the parties’ agreement in a manner contrary to one of its unambiguous provisions. In
       other words, ITW argues that, because it agreed with Western that their relationship was one
       between a principal buyer and a principal seller, a trier of fact could not infer that they agreed
       to carry on an enterprise or demonstrated an intent to be joint venturers.
¶ 77       “Courts look to the substance and not to the form to determine whether there is a joint
       venture with the most important element being the intention of the parties.” Petry v. Chicago
       Title & Trust Co., 51 Ill. App. 3d 1053, 1057 (1977). “A joint venture is not a status created
       or imposed by law, but is a relationship voluntarily assumed and arising wholly ex contractu;
       the relationship is a matter of intent as between the parties.” Public Electric Construction
       Co., 62 Ill. App. 3d at 531. Courts determine the parties’ intent “in accordance with the
       ordinary rules governing the interpretation and construction of contracts.” Carroll v.
       Caldwell, 12 Ill. 2d 487, 497 (1957). “A joint venture agreement need not expressly state that
       such was intended ***.” United Nuclear Corp. v. Energy Conversion Devices, Inc., 110 Ill.
       App. 3d 88, 110 (1982).
¶ 78       In Public Electric Construction Co., on which ITW relies, the plaintiff and the defendant
       orally agreed to perform electrical work together on a construction project. They agreed that
       the plaintiff would provide labor, the defendant would provide material, and the parties
       would share equally the profits or losses. After work on the project began, the parties reduced
       their agreement to writing, designating the defendant as a subcontractor and the plaintiff as a
       sub-subcontractor. The agreement provided: “ ‘It is understood and agreed by and between
       the parties that this Agreement is not contemplated to form any association, partnership or
       joint venture agreement between the parties hereto. The parties will continue to be
       subcontractor and sub-subcontractor, respectively.’ ” Public Electric Construction Co., 62 Ill.
       App. 3d at 530. Following a bench trial, the trial court found that no joint venture existed
       between the parties. Public Electric Construction Co., 62 Ill. App. 3d at 529-31.
¶ 79       The appellate court affirmed, reasoning that the record was clear that the parties did not
       intend to enter into a joint venture. The court stated that “the contract as executed explicitly
       reject[ed] the existence of any joint venture.” Public Electric Construction Co., 62 Ill. App.
       3d at 531. The court further reasoned that, because the parties’ intent could be “easily
       ascertained” from the contract language, no further contract construction was necessary.
       Public Electric Construction Co., 62 Ill. App. 3d at 531-32.
¶ 80       Here, the parties’ intent is not so easily ascertained from the manufacturing agreement.
       The “Independent Contractor” provision states that ITW and Western agree that neither is the
       agent of the other. According to ITW, this suggests an intent not to be joint venturers,
       because, like partners in a partnership, co-venturers in a joint venture are agents of each
       other. Ioerger v. Halverson Construction Co., 232 Ill. 2d 196, 202 (2008). However, unlike
       the agreement in Public Electric Construction Co., the agreement here does not explicitly
       state that the parties are not engaged in a joint venture. This is critical, because “the
       declaration of the parties is not controlling where the conduct of the parties demonstrates the
       existence of an agency relationship.” Oliveira-Brooks v. Re/Max International, Inc., 372 Ill.
       App. 3d 127, 134 (2007). In other words, even if two parties expressly disclaim an agency

                                                   - 13 -
       relationship, a trier of fact nevertheless may find that one exists, based on the parties’
       conduct. Daniels v. Corrigan, 382 Ill. App. 3d 66, 75 (2008). Therefore, contrary to ITW’s
       argument, the agreement’s “Independent Contractor” provision is not determinative of
       whether a joint venture existed.
¶ 81       Additionally, the agreement contains a number of other provisions that, when viewed in
       the light most favorable to plaintiff, could evince an intent to carry on an enterprise and to be
       joint venturers. Significantly, the agreement provided that ITW and Western would work
       together to design new products and to improve the production process. The “Cost
       Improvement” section provided that Western and ITW agreed to “work together to
       implement cost improvements in processes *** and overhead” and to share equally the
       benefits of those cost improvements. Similarly, the “Technology, Designs, Confidentiality”
       section provided that ITW would “work with Western to develop new designs or Products”
       and may “accept for use *** designs which are initiated by Western.” Western agreed that it
       could not use the resulting designs “for any purpose other than manufacture of Products for
       ITW.” These provisions contemplated ITW and Western working together to achieve
       improvements in the manufacturing process and in product designs. Based on these
       provisions, a trier of fact could conclude that the parties intended not a simple buyer-seller
       arrangement, but a joint venture, the goal of which was to develop an efficient and profitable
       manufacturing operation.
¶ 82       Similarly, pursuant to the “Inspections and Warranty” section of the agreement, ITW
       retained the right to approve all changes to the manufacturing process, including substitution
       of parts, raw materials, process equipment, “or other items.” ITW also had the right to
       inspect the finished products prior to receipt, “at any reasonable time,” and Western was
       required to make “any improvements or changes” that ITW reasonably requested as the result
       of its inspections. Viewed in the light most favorable to plaintiff, these provisions at least
       suggest an intent to carry on a jointly controlled manufacturing enterprise.
¶ 83       Furthermore, the relationship outlined in the manufacturing agreement was such that
       neither party could benefit from the arrangement at the expense of the other. Western agreed
       not to “manufacture, process for or sell to any purchasers other than ITW items similar in
       specification or design” to the products it manufactured for ITW. In addition, the price at
       which Western sold the products to ITW was fixed according to a formula outlined in the
       agreement. Any cost improvements achieved in processes or overhead had to be shared
       equally between the parties. Thus, Western had no ability to increase its profit at ITW’s
       expense. Rather, Western had to sell all of the Formex products it produced to ITW at a
       predetermined price, and it could not reduce its costs without sharing the benefits of those
       cost improvements with ITW. Again, a trier of fact could conclude that ITW and Western did
       not intend an ordinary buyer-seller relationship.
¶ 84       Finally, the agreement contemplated a long-term relationship that, when viewed in light
       of the agreement’s other provisions, at least suggests the existence of a joint manufacturing
       enterprise. The agreement provided that it would automatically renew each year, except upon
       60 days’ written notice to the contrary. It also provided that Western agreed to manufacture
       and sell products to ITW in the quantities and pursuant to the schedule “set forth in a yearly
       blanket purchase order from ITW.” The agreement also required that Western maintain the
       capacity to produce 800,000 pounds of sheet products annually.


                                                  - 14 -
¶ 85       Not only do the unique provisions of the manufacturing agreement create a genuine issue
       of material fact as to the parties’ intent to carry on an enterprise and to be joint venturers, but
       also the parties’ conduct subsequent to the execution of the agreement creates an issue of fact
       on this issue. Among that conduct was (1) Benson’s May 23, 1994, letter to Ray Howard
       acknowledging Western as a “warehousing facility” for ITW’s finished goods and noting that
       “this type of arrangement helps enable Fastex to function with Western Plastics as a true
       extension of our business”; (2) ITW’s installation of the electronic monitoring devices on
       Western’s extruding machines; (3) ITW’s purchase of new rollers for one of Western’s
       extruding machines; and (4) ITW’s payment for the overtime hours of Western employees
       when large orders needed to be filled and overtime work was required. Although none of this
       evidence is conclusive of the parties’ intent to carry on an enterprise or to be joint venturers,
       when viewed in the light most favorable to plaintiff it creates a genuine issue of material fact
       as to these issues.

¶ 86                                    2. Community of Interest
¶ 87       The trial court found that there was a genuine issue of material fact as to whether ITW
       and Western shared a community of interest, and we agree. A community of interest is
       established when the parties have both contributed property, finances, effort, skill, or
       knowledge to the joint venture. Fitchie, 212 Ill. App. 3d at 227. In Fitchie, a community of
       interest was found where one party purchased lottery tickets and two others expended their
       time and energy scratching the tickets. Fitchie, 212 Ill. App. 3d at 227.
¶ 88       Here, there is ample evidence that both ITW and Western made contributions to the
       manufacturing operation. The evidence revealed that ITW supplied the raw material plastic
       pellets, 10% of the shipping pallets, and the product labels. It also contributed funds toward
       the purchase and refurbishing of the rollers. Perhaps ITW’s most significant contribution was
       the monitoring devices, which ITW owned and incurred the costs of purchasing, installing,
       and maintaining. The devices were integral parts of Western’s extruding machines,
       controlling the speed of the rollers whenever the machines were producing ITW’s products.
       Western contributed the extruding machines and the labor to operate the machines.

¶ 89                                3. Joint Control and Management
¶ 90       The trial court found that the element of shared control and management was not present,
       because any control that ITW exerted was related to ensuring that its product specifications
       were met. Although we agree with the trial court that ITW’s focus at least in part was its
       product specifications, we nevertheless believe that there is a genuine issue of material fact
       as to whether ITW “directed” or “governed” Western’s conduct in achieving those
       specifications. See Herst v. Chark, 219 Ill. App. 3d 690, 696 (1991) (the element of shared
       control requires only “some right by the parties to direct and govern the conduct of each
       other in connection with the joint venture”); see also Ambuul v. Swanson, 162 Ill. App. 3d
       1065, 1069 (1987) (reasoning that a joint venture does not require a co-venturer’s
       participation in “the day-to-day management of the enterprise”). Moreover, ITW’s focus in
       directing and governing Western’s conduct was not only achieving its product specifications,
       but also achieving greater efficiency and cost savings.



                                                   - 15 -
¶ 91       Much of the evidence relevant to the issue of joint control revolved around Pedersen.
       Although not an employee of either ITW or Western, Pedersen acted as “go-between” for the
       two companies, performed a variety of tasks, and received compensation from both
       companies. ITW paid Pedersen as an independent contractor, while Western paid him a sales
       commission. Perhaps most significantly, Pedersen, while acting as ITW’s representative,
       assisted in the scheduling of Western’s production. This reduced the number of
       time-consuming adjustments to the extruding machines, resulting in efficiency that benefited
       both ITW and Western. Cobb testified that the production schedule would sometimes change
       two or three times per day and that Pedersen was “there just like another employee.” A trier
       of fact could conclude that ITW, through Pedersen, exercised control over the manufacturing
       operation with the aim of making it more efficient and profitable for both ITW and Western.
¶ 92       Furthermore, as discussed above, the manufacturing agreement gave ITW the right to
       inspect the finished products prior to receipt, “at any reasonable time.” Benson testified that
       ITW “frequently” exercised this right through Pedersen. According to Benson, Pedersen had
       “the right to tell the operator something need[ed] to be done.” Pedersen testified that he did
       not direct Western on how to fix the defects he located, but he also testified that Western
       would remediate any problem he brought to its attention. Indeed, the manufacturing
       agreement required Western to make “any improvements or changes” that ITW reasonably
       requested as the result of its inspections. This is further evidence of the control that ITW
       exercised.
¶ 93       In addition, the electronic monitoring devices constitute evidence, at least to some
       degree, of ITW’s control or management of the manufacturing operation. Although the
       deposition testimony indicated that Western controlled whether the monitoring devices were
       turned on or off, the testimony further indicated that the devices were turned on whenever the
       extruding machines were producing ITW’s products. When turned on, the devices controlled
       the speed of the rollers, using preprogrammed specifications for ITW’s products. Pedersen
       testified that he had at times entered specifications into the devices when Western “had
       problems” with them. At a minimum, that ITW owned these devices suggests that it was so
       deeply involved in the manufacturing operation that Western was not free to fill ITW’s
       orders in any manner it saw fit. Rather, by purchasing, installing, and maintaining the
       devices, ITW made it such that Western could not produce ITW’s products completely
       independently of ITW. Western’s production became dependent upon an integral component
       that ITW contributed, owned, and maintained.

¶ 94                                   4. Shared Profits and Losses
¶ 95       The trial court found that the element of shared profits and losses was the “easiest
       element” to analyze. Most significant in the trial court’s view was that there was no evidence
       that ITW and Western “got together at the end of [the] fiscal year *** and did a joint
       accounting and divided *** the profits or losses.” Although we agree with the trial court that
       there was no evidence of joint accounting, we nevertheless conclude that there is a genuine
       issue of material fact as to whether the parties shared profits and losses.
¶ 96       Significantly, the parties have not cited, and our research has not uncovered, any Illinois
       case holding that, for the shared-profits element of a joint venture to be established, the
       parties must engage in joint accounting or “pool” their profits and losses prior to dividing


                                                 - 16 -
        them. Rather, Illinois case law indicates that, as long as the parties share in the same revenue
        stream, the shared-profits element may be established. See Herst, 219 Ill. App. 3d at 695-96.
¶ 97         In Herst, the plaintiff and the defendant entered into an oral agreement to engage in the
        commercial debt collection business. The plaintiff was to sell the services to clients, and the
        defendant was to perform the debt collection. Herst, 219 Ill. App. 3d at 694-95. When the
        plaintiff sold the services to a client, the client would pay a refundable retainer deposit.
        Herst, 219 Ill. App. 3d at 694. The client then received a credit equal to 20% of the deposit
        toward the collection fees earned by the defendant when he fulfilled the services. Herst, 219
        Ill. App. 3d at 694-95. The trial court found that the parties were engaged in a joint venture,
        and the appellate court affirmed. Herst, 219 Ill. App. 3d at 692-93.
¶ 98         Addressing the shared-profits element, the appellate court reasoned that the parties agreed
        to “divide the business along two function lines, marketing and fulfillment.” Herst, 219 Ill.
        App. 3d at 695. The parties also divided the revenues and expenses along those same
        functional lines. Herst, 219 Ill. App. 3d at 695. Although the plaintiff did not share in the
        profits and losses of the defendant’s business as a whole, “he nevertheless shared in that part
        of the profits and losses as between the parties with respect to particular clients serviced
        through the refundable retainer program set up by [the plaintiff].” Herst, 219 Ill. App. 3d at
        695-96. The court concluded that the evidence was sufficient to establish that the parties
        were engaged in a joint venture, rather than “a principal/agent sales business.” Herst, 219 Ill.
        App. 3d at 696.
¶ 99         Here, a trier of fact could conclude that, similar to the parties to the debt collection
        arrangement in Herst, the parties divided the manufacturing operation along functional lines
        and divided the revenues and expenses of the operation along those same lines. ITW owned
        the proprietary Formex formula and provided the raw material plastic pellets, 10% of the
        shipping pallets, and the product labels. Western owned the extruding machines and provided
        the labor and the remainder of the shipping pallets. Western’s function was to run ITW’s raw
        material through its extruding machines, using the monitoring devices that ITW contributed.
        Western then received a predetermined price for the finished products, based upon the
        number of pounds of product it produced. ITW’s function was to perform quality control and
        to sell the finished products to customers. If ITW’s sales volume increased or decreased,
        Western’s revenue increased or decreased in the same proportion, since the revenue it
        received was based on the predetermined formula contained in the manufacturing agreement.
¶ 100        Further supporting a conclusion that the parties may have shared profits and losses is the
        consideration, already discussed above, that the terms of the manufacturing agreement made
        it such that neither party could profit at the expense of the other. Because Western was not
        free to manufacture, process, or sell the Formex plastic sheet products to anyone other than
        ITW, and because the price at which Western sold the products to ITW was calculated
        pursuant to a predetermined formula, Western could not increase its profits at ITW’s
        expense. Instead, Western received a predetermined price, based on the formula in the
        agreement, for all of the products it manufactured for ITW. If Western sought to increase its
        profits by implementing “cost improvements,” it had to share equally with ITW the benefits
        of those improvements. As a result, the parties were both interested in making the
        manufacturing operation more efficient, and they shared equally the financial benefits of any
        improvements in efficiency.


                                                   - 17 -
¶ 101        The dissent concludes that there is no genuine issue of material fact as to the
        shared-profits element. According to the dissent, what we have described as the sharing of
        profits and losses “would apply to any relationship between entirely independent companies
        engaged in the manufacture and distribution of a product.” Infra ¶ 127. As our discussion
        shows, it is inaccurate to characterize the relationship between ITW and Western as one
        between “entirely independent companies.” While it is difficult to provide a precise
        definition of their relationship, at a minimum ITW and Western had a long-term, closely
        intertwined relationship, in which they dealt nearly exclusively with each other, jointly
        contributed equipment and raw material, and worked together to implement mutually
        beneficial “cost improvements.” These considerations distinguish this case from Wells v.
        Whitaker, 151 S.E.2d 422 (Va. 1966), cited by the dissent, which involved two companies
        with a much less intertwined relationship than that between ITW and Western. Given the
        unique facts of this case–including the requirement that Western share equally all “benefits
        of cost improvements” with ITW–we believe that it is for a jury to decide whether ITW and
        Western shared profits and losses.
¶ 102        In sum, we conclude that there is a genuine issue of material fact as to whether ITW and
        Western were engaged in a joint venture. We express no opinion on whether plaintiff will be
        able at trial to meet his burden of proving the existence of a joint venture. See Yorkel v. Hite,
        348 Ill. App. 3d 703, 708 (2004) (noting that the party contending that a joint venture exists
        has the burden of proving such a relationship). We merely conclude that summary judgment
        was improper based on the record before us. Moreover, we express no opinion regarding
        whether the allegedly negligent acts that caused plaintiff’s injury were committed during the
        course of the enterprise. See Barton, 159 Ill. App. 3d at 973 (noting that members of a joint
        venture are vicariously liable for the negligent acts of fellow venturers committed during the
        course of the enterprise). The parties have not addressed this issue, and we decline to address
        it sua sponte.

¶ 103                  B. Workers’ Compensation Act’s Exclusive-Remedy Provision
¶ 104       Plaintiff contends that the trial court erred in sua sponte ruling that, if ITW were engaged
        in a joint venture with Western, the exclusive-remedy provision of the Workers’
        Compensation Act (820 ILCS 305/5(a) (West 2012)) would immunize ITW from liability.
        He points out that the issue “had never before been raised by defense counsel.” At oral
        argument, ITW conceded that it did not raise the issue below and that it was “raised purely
        by the court.” Nevertheless, ITW contends that the provision provides an alternative basis to
        affirm the entry of summary judgment in its favor.
¶ 105       We agree with plaintiff that it was error for the trial court to raise this issue sua sponte.
        The exclusive-remedy provision is an affirmative defense and is forfeited if not timely raised.
        Doyle v. Rhodes, 101 Ill. 2d 1, 10 (1984); Sobczak v. Flaska, 302 Ill. App. 3d 916, 919
        (1998). Whether to assert the exclusive-remedy provision as a defense can be a strategic
        decision, as a defendant “may choose not to raise it in the hope that the plaintiff will be
        unable to prove negligence to a jury’s satisfaction,” thus avoiding liability. Doyle, 101 Ill. 2d
        at 10. On the other hand, if a defendant raises the exclusive-remedy provision as a defense, it
        might subject itself to no-fault liability under the Workers’ Compensation Act. See Sharp v.
        Gallagher, 95 Ill. 2d 322, 326 (1983) (explaining that, in exchange for the imposition of
        no-fault liability upon the employer, the Workers’ Compensation Act prohibits common-law

                                                   - 18 -
        suits against the employer). In Sobczak, the appellate court found that the defendant had not
        forfeited the defense of the exclusive-remedy provision where, although it did not plead it, it
        raised the defense in a summary-judgment motion and the plaintiff responded to the motion
        on the merits. Sobczak, 302 Ill. App. 3d at 920. The court reasoned that any forfeiture was
        “technical only” and that the plaintiff was not prejudiced by the defendant’s failure to plead
        the defense. Sobczak, 302 Ill. App. 3d at 920.
¶ 106        Here, ITW concedes that it did not plead the exclusive-remedy provision as an
        affirmative defense or raise the issue in its motion for summary judgment. Instead, as
        plaintiff pointed out at oral argument, the parties engaged in more than five years of motion
        practice and discovery, taking more than 40 depositions, many of which focused on the issue
        of whether ITW and Western were engaged in a joint venture. Clearly, ITW made a strategic
        decision not to assert the exclusive-remedy provision as a defense, in the hope that it could
        avoid liability altogether by defeating plaintiff’s tort claim. Nevertheless, at the hearing on
        ITW’s summary-judgment motion, following the parties’ lengthy arguments that did not
        discuss the exclusive-remedy provision, the trial court sua sponte raised the issue. This was
        error. See In re Marriage of Drewitch, 263 Ill. App. 3d 1088, 1093 (1994) (“A trial judge
        may not be an advocate for a party, *** but must take the case as the parties have presented
        it.”). If ITW were permitted to raise the exclusive-remedy provision as a defense at this late
        stage, despite its earlier decision not to assert the defense, then plaintiff would be prejudiced.
¶ 107        We recognize the general rule that, “although a defense not raised in the trial court may
        not be raised for the first time on appeal by an appellant, ‘the appellee may urge any point in
        support of the judgment on appeal, *** so long as the factual basis for such point was before
        the trial court.’ ” Travelers Casualty & Surety Co. v. Bowman, 229 Ill. 2d 461, 470-71 (2008)
        (quoting Shaw v. Lorenz, 42 Ill. 2d 246, 248 (1969)). However, “[w]hile an appellee is not as
        limited in the scope of review as is an appellant, nevertheless, the review cannot go beyond
        the issues appearing in the record.” Consoer, Townsend & Associates v. Addis, 37 Ill. App.
        2d 105, 110 (1962). “The issues are determined from the pleadings and the evidence.”
        Consoer, Townsend & Associates, 37 Ill. App. 2d at 110. “[T]o permit a change of theory on
        review ‘would not only greatly prejudice the opposing party but would also weaken our
        system of appellate jurisdiction.’ ” Kravis v. Smith Marine, Inc., 60 Ill. 2d 141, 148 (1975)
        (quoting In re Estate of Leichtenberg, 7 Ill. 2d 545, 548-49 (1956)). Thus, an issue raised by
        an appellee for the first time on appeal “must at least be commensurate with the issues”
        presented in the trial court. Greer v. Illinois Housing Development Authority, 122 Ill. 2d 462,
        509 (1988).
¶ 108        As we have said, ITW chose to litigate this case by defending against plaintiff’s tort
        claim on the merits. Having made the strategic decision not to raise the affirmative defense of
        the exclusive-remedy provision, it cannot now change its theory on appeal.

¶ 109                                       C. Right of Control
¶ 110       Plaintiff next argues that a genuine issue of material fact exists regarding whether ITW
        retained control over Western, giving rise to a duty of care. He relies on section 414 of the
        Restatement (Second) of Torts, which provides for liability against a party who retains less
        control over another than is necessary to give rise to a principal-agent relationship, but who
        nevertheless retains some control over the manner in which work is done. See Restatement


                                                    - 19 -
        (Second) of Torts § 414 cmts. a, c (1965). Plaintiff contends that, even if Western was not
        ITW’s agent, ITW at least retained control over the manner in which Western worked.
¶ 111       ITW responds that it retained no control over Western’s safety practices and that any
        control it did retain was related to quality-control measures. It also posits that a higher degree
        of control than it exercised is legally required for a duty of care under section 414.
¶ 112       Generally, one who employs an independent contractor is not liable for the contractor’s
        acts or omissions. Wilfong v. L.J. Dodd Construction, 401 Ill. App. 3d 1044, 1060 (2010). An
        exception to the rule is found in section 414 of the Restatement (Second) of Torts:
                    “One who entrusts work to an independent contractor, but who retains the control
                of any part of the work, is subject to liability for physical harm to others for whose
                safety the employer owes a duty to exercise reasonable care, which is caused by his
                failure to exercise his control with reasonable care.” Restatement (Second) of Torts
                § 414 (1965).
        As we noted above, liability under this section arises when a party retains less control than is
        necessary to give rise to a principal-agent relationship. Restatement (Second) of Torts § 414
        cmt. a (1965). For the section to apply, the party “must have retained at least some degree of
        control over the manner in which the work is done,” such that “the contractor is not entirely
        free to do the work in his own way.” Restatement (Second) of Torts § 414 cmt. c (1965).
¶ 113       Even assuming arguendo that ITW retained sufficient control over Western to invoke
        section 414, this does not mean that summary judgment in ITW’s favor on this issue was
        improper. ITW argues that, because any control that it retained was unrelated to safety or to
        cleaning the rollers, it could not be held liable under section 414. We agree.
¶ 114       Under section 414, when an employer has retained control over the manner in which
        work is done, the employer “is subject to liability if he fails to prevent the [independent
        contractor] from doing even the details of the work in a way unreasonably dangerous to
        others, if he knows or by the exercise of reasonable care should know that the [independent
        contractor’s] work is being so done, and has the opportunity to prevent it by exercising the
        power of control which he has retained in himself.” Restatement (Second) of Torts § 414
        cmt. b (1965); see Schaughnessy v. Skender Construction Co., 342 Ill. App. 3d 730, 739
        (2003) (declining liability under section 414 when the defendant did not see the plaintiff
        “engage in the unsafe practice that led to his injury or even had notice that plaintiff intended
        to engage in such conduct”).
¶ 115       Here, there was no evidence that ITW retained any control over safety at Western or over
        the manner in which Western’s employees cleaned the extruding machines. The
        manufacturing agreement did not impose on ITW the obligation to monitor safety at Western
        or grant it the authority to supervise Western employees while they were cleaning the
        machines. According to Smith, Harold trained each new employee, and there were no written
        instructions or manuals. Both Harold and plaintiff testified that Harold was the only one who
        trained plaintiff on how to clean the machines. Moreover, Edelstein testified that ITW played
        no role in the design or construction of the machine that injured plaintiff. The emergency
        stop cord, which was the only safety device on the machine, was installed by the electrician
        in accordance with Edelstein’s instructions. Pedersen, who was present at Western far more
        often than any other representative of ITW, testified that he was not familiar enough with the
        machines to know what safety devices were available to stop a machine if someone were


                                                    - 20 -
        injured. In sum, there was no evidence that ITW retained any control over safety at Western
        or over how or when the machines were cleaned.
¶ 116       Similarly, there was no evidence that ITW had any opportunity to prevent plaintiff’s
        injuries or had notice that the machines were being cleaned in an unsafe manner. Smith
        testified that, when plaintiff’s injuries occurred, the rollers were set at 790, which was “very
        fast,” instead of at 200 or 300, which was “very slow.” Although Smith testified that on one
        prior occasion he had observed plaintiff cleaning the rollers at that speed, there was no
        evidence that anyone from ITW had witnessed any Western employees cleaning the
        machines in an unsafe manner. Thus, there was no evidence that ITW either knew that the
        cleaning process was unsafe or had the opportunity to prevent plaintiff’s accident.
¶ 117       Based on the foregoing, we conclude that summary judgment in ITW’s favor on this issue
        was proper. There was no evidence that ITW retained control over safety at Western or over
        how Western’s employees cleaned the extruding machines. Nor was there any evidence that
        ITW could have prevented plaintiff’s injuries by exercising any control it retained.

¶ 118                               D. Unreasonably Dangerous Machine
¶ 119       Plaintiff finally contends that a genuine issue of material fact exists as to whether ITW
        owed him a duty of care arising out of its actual or constructive knowledge that the extruding
        machine was unreasonably dangerous. He relies on a single case, Adams v. Northern Illinois
        Gas Co., 211 Ill. 2d 32 (2004), which involved a negligence claim against a natural-gas
        supplier. Plaintiff has not cited any case applying Adams outside of the natural-gas context.
¶ 120       In Adams, the issue was whether the defendant natural-gas supplier had a duty to warn its
        customers that a common brass connector was likely to corrode and cause gas leaks. Adams,
        211 Ill. 2d at 44. In holding that the supplier was under such a duty, the court reasoned that
        gas was a dangerous substance when not under control and that gas suppliers can be held
        liable for negligence in permitting gas to escape. Adams, 211 Ill. 2d at 45. The court further
        reasoned that the defendant had superior knowledge of the risks the connectors posed and
        knew that the sulfur in the gas it supplied contributed to the connectors’ corrosion. Adams,
        211 Ill. 2d at 52-54. The court agreed with the following statement from a Colorado case
        involving a gas supplier: “ ‘When a party can reasonably foresee that its product will be used
        as an integral component of a defective and unreasonably dangerous product, there is a duty
        upon that party to undertake corrective action to alleviate, if possible, the hazard.’ ” Adams,
        211 Ill. 2d at 53 (quoting Halliburton v. Public Service Co. of Colorado, 804 P.2d 213, 216
        (Colo. App. 1990)).
¶ 121       Plaintiff has not articulated any reason why Adams should be extended to this case. ITW
        is not the supplier of a dangerous substance like natural gas. Plaintiff simply asserts that,
        “[a]pplying Adams to the case at hand, ample facts exist that ITW knew of the hazard and
        should have taken steps to alleviate the hazard.” He cites no case, other than Adams, to
        support his assertion that ITW’s knowledge of the allegedly dangerous condition of
        Western’s machines would give rise to a duty. Because plaintiff has not articulated any
        reason why Adams should be extended beyond the natural-gas context, we decline to extend
        it here. See Wright v. Board of Education of the City of Chicago, 335 Ill. App. 3d 948, 957
        (2002) (declining to extend a case involving a gas supplier outside of that context).



                                                   - 21 -
¶ 122                                    III. CONCLUSION
¶ 123      For the foregoing reasons, we reverse the judgment of the circuit court of Du Page
        County and remand for further proceedings.

¶ 124      Reversed and remanded.




¶ 125       JUSTICE BURKE, dissenting.
¶ 126       The evidence presented at summary judgment in this case does not raise a genuine issue
        of material fact as to whether Western and ITW were engaged in a joint venture. I agree with
        the trial court that the “easiest element to analyze [was] whether there was a sharing of
        profits and losses.”
¶ 127       What is described by the majority as the sharing of profits and losses based on the sharing
        of the same revenue stream–and the increase or decrease in revenue based on the increase or
        decrease in sales volume–would apply to any relationship between entirely independent
        companies engaged in the manufacture and distribution of a product. To characterize all such
        relationships as joint ventures would lead to absurd results. Any profits accruing from the
        movement of a product from the manufacturer to the processor and then to the ultimate
        consumer cannot be said to be a sharing of the profits of the processor, otherwise every firm
        that furnishes materials in connection with an enterprise might be termed a joint venturer
        whether or not it had such intent. See Wells v. Whitaker, 151 S.E.2d 422, 431 (Va. 1966).
¶ 128       The majority cites Herst v. Chark, 219 Ill. App. 3d 690 (1991), as authority for the
        proposition that, where parties divide a manufacturing operation along functional lines and
        divide the revenues and expenses along those lines, there is an issue as to whether they are
        sharing in profits and losses. Although the Herst court cited the division of the business, and
        the revenues and the expenses, along functional lines, it is unclear whether the court linked
        that division to a factor other than the sharing of profits and losses. Regardless, Herst is
        readily distinguishable from this case on that factor.
¶ 129       In Herst, the court held that the parties shared profits and losses, relying on the parties’
        creation and use of a jointly-owned account for handling the finances of the enterprise. There
        also was evidence that the parties actually shared profits and losses related to the clients who
        were serviced through the parties’ program. Herst, 219 Ill. App. 3d at 695-96.
¶ 130       Here, there is no evidence of a joint account and no evidence of the sharing of either
        company’s profits or losses. In fact, Don Edelstein of Western specifically testified that his
        company and ITW did not share profits.
¶ 131       The majority points out areas where Western and ITW agreed to share in certain costs
        and in savings from cost improvements. I agree with the trial court that, although cost
        improvements–and costs, for that matter–might impact profits and losses, such cost
        improvements are not profits and losses themselves. In Coburn Supply Co. v. Kohler Co.,
        194 F. Supp. 2d 580, 582 (E.D. Tex. 2002), the court held that the defendant’s agreement to
        share in the costs of promoting its products sold through the plaintiff was not synonymous
        with the sharing of losses. Likewise, the sharing of cost improvements is not synonymous
        with the sharing of profits. See Vern Shutte & Sons v. Broadbent, 473 P.2d 885, 886 (Utah

                                                   - 22 -
        1970) (“ ‘[I]t is not enough that the parties act in concert to achieve some economic
        objective. The ultimate inquiry is whether the parties manifested by their conduct a desire to
        commingle their profits, control, and risks in achieving the objective.’ ” (quoting Hayes v.
        Killinger, 385 P.2d 747, 754 (Or. 1963))).
¶ 132       This case is similar to Kaporovskiy v. Grecian Delight Foods, Inc., 338 Ill. App. 3d 206
        (2003), where the appellate court considered whether Grecian Delight had entered into a joint
        venture with Motorsport Marketing, where Motorsport would exclusively promote Grecian
        Delight’s food products at various racing events. Determining that there was no sharing of
        profits and losses, the court stated, “[t]here is nothing in the record that indicates that Grecian
        Delight would share in any losses Motorsport suffered if the food did not sell. Nor is there
        anything in the record that indicates that Motorsport shared any profits it gained in selling the
        food products.” Kaporovskiy, 338 Ill. App. 3d at 213.
¶ 133       Like in Kaporovskiy, nothing in the present case shows that Western would share in
        ITW’s losses if the plastic products sat in a warehouse and did not sell. Similarly, although
        Western and ITW each anticipated profiting from their relationship, there is nothing to show
        that ITW shared with Western any profits it realized from the sale of the products. Thus,
        under the undisputed facts presented, there was no sharing of profits and losses between ITW
        and Western. See Vern Schutte, 473 P.2d at 886 (for the creation of a joint venture, the profit
        accruing must be joint and not several); see also Inter-City Tire & Auto Center, Inc. v.
        Uniroyal, Inc., 701 F. Supp. 1120, 1126 (D.N.J. 1988) (“[t]he anticipation of separate profits
        for each party does not amount to an intention to share profits”).
¶ 134       In the absence of sharing of profits and losses, no joint venture exists. O’Brien v.
        Cacciatore, 227 Ill. App. 3d 836, 843 (1992). Therefore, the relationship between Western
        and ITW was not a joint venture. Because I agree with the majority’s analysis on plaintiff’s
        contentions concerning ITW’s right to control and knowledge of the unreasonably dangerous
        machine, I would affirm the trial court’s order granting ITW’s motion for summary
        judgment.
¶ 135       I am also concerned by the majority’s treatment of the workers’ compensation issue. The
        majority states, “[w]e agree with plaintiff that it was error for the trial court to raise this issue
        sua sponte.” Supra ¶ 105. The majority then elaborates that the sua sponte nature of the
        ruling prejudiced plaintiff and failed to hold ITW to its tactical decisions. While the legal
        analysis on this point is quite sound, the problem is that plaintiff never argued this issue.
¶ 136       Plaintiff noted in his briefs that the trial court raised the workers’ compensation issue
        sua sponte, but he never argued that he was prejudiced or that the ruling must be limited to
        those issues raised by ITW in its pleadings. Plaintiff simply argues the merits of whether
        ITW was immune under the Workers’ Compensation Act if it was engaged in a joint venture
        with Western.
¶ 137       Plaintiff was certainly free to argue, both in a motion to reconsider in the trial court and
        on appeal, that he was prejudiced by the trial court’s sua sponte ruling and that the trial court
        erred in considering an issue that ITW chose not to raise. Plaintiff did neither. The majority
        notes that a trial judge may not be an advocate for a party, but it does exactly that by raising
        an issue and making arguments that plaintiff has never articulated.
¶ 138       Since the majority has determined that there is a genuine issue of material fact regarding
        whether ITW and Western were engaged in a joint venture, I believe that the majority should
        address the merits of the workers’ compensation issue as framed by the parties on appeal.

                                                     - 23 -
