Court Refuses to Honor an Illegal Agreement

Post 4854

HE claimed Ms. Kiraga had received money under such circumstances that in equity and good conscience she ought not be allowed to keep but the Equities Remained with her. 

In HE Electric, Inc. v. Edyta Kiraga, No. 1-25-2650, 2026 IL App (1st) 252650-U, Court of Appeals of Illinois, First District, Fifth Division (September 25, 2026) HE Electric, Inc. (HE) appeals the circuit court’s order dismissing its unjust enrichment claim against Edyta Kiraga HE claimed that Miroslaw Szczerbowski, Ms. Kiraga’s ex-husband, had an oral agreement with HE by which HE would put Ms. Kiraga on its payroll so that she could receive health insurance through HE.

In return, Mr. Szczerbowski would repay HE the amount it spent on Ms. Kiraga’s salary and health insurance premiums. Mr. Szczerbowski died without making any payments to HE under this agreement.

The Court of Appeals affirmed the circuit court’s dismissal of the unjust enrichment claim under the Code of Civil Procedure (Code). HE has not alleged facts on which it could be found that Ms. Kiraga’s retention of the benefits she received was unjust.

BACKGROUND

In December 2021, HE filed a complaint against Ms. Kiraga alleging unjust enrichment and tortious interference with contract. According to the operative complaint, on or around January 1, 2016, Mr. Szczerbowski and HE entered into an agreement under which HE would advance Mr. Szczerbowski money to pay for health insurance benefits for Ms. Kiraga, her stepson, and her daughter. Mr. Szczerbowski advised HE that, for Ms. Kiraga to obtain health insurance under HE’s health plan, HE would have to put her on its payroll and make regular payroll payments to her.

Although Ms. Kiraga never performed any services for HE, from 2016 to 2019, it paid her $42,162.96 in payroll payments and advanced approximately $50,000 to Mr. Szczerbowski for the payment of monthly health insurance premiums for Ms. Kiraga and her children.

Mr. Szczerbowski died on January 16, 2019. Neither Mr. Szczerbowski nor his estate ever repaid any money to HE.

Ms. Kiraga had received money under such circumstances that in equity and good conscience she ought not be allowed to keep and, instead, she should repay HE.

Ms. Kiraga moved to dismiss the unjust enrichment claim under section 2-615 of the Code. Following a bench trial, the court entered a final judgment. HE appealed the dismissal of its unjust enrichment claim.

JURISDICTION

The order became final and appealable when the circuit court entered its final judgment after the bench trial, on November 24, 2025.

ANALYSIS

A motion to dismiss filed under section 2-615 of the Code attacks the legal sufficiency of a complaint based on defects apparent on its face. The question before the Court of Appeals was whether the complaint’s allegations, viewed in the light most favorable to the plaintiff, state a cause of action upon which relief can be granted.

The plaintiff need not prove any fault or illegality on the defendant’s part. The plaintiff must prove, however, both that the defendant voluntarily accepted a benefit and that it would be inequitable for the defendant to retain the benefit without payment.

HE argues that, by accepting the benefit, Ms. Kiraga adopted the means by which the benefits were procured. Its assertion that it is “better suited” or has “a better claim” to the $92,162.96 that Ms. Kiraga has allegedly been enriched by is completely conclusory and not supported by its allegations.

There is a third, alternative reason that this claim fails: HE’s agreement with Mr. Szczerbowski was insurance fraud. Courts will not enforce an illegal contract or any rights that arise from an illegal contract, which exists where the contract’s terms violate the law or require one or both parties to perform an illegal act.

Allowing HE to recover for unjust enrichment because the illegal agreement it entered was not honored would be tantamount to enforcing the illegal agreement. That is an alternative reason that this claim fails.

CONCLUSION

For the foregoing reasons, the Court of Appeal affirmed the judgment of the circuit court of Cook County dismissing HE’s unjust enrichment claim under section 2-615.

ZALMA OPINION

Honest people needing help with medical bills that they can’t pay do less than honest things. HE was the victim of the scheme where it agreed to allow an employee get money for the needs of  HE would advance Mr. Szczerbowski money to pay for health insurance benefits for Ms. Kiraga, her stepson, and her daughter. Mr. Szczerbowski advised HE that, for Ms. Kiraga to obtain health insurance under HE’s health plan. He died before he could pay it back. HE sued to get its money back and failed because it agreed to the scheme.

(c) 2026 Barry Zalma & ClaimSchool, Inc.

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