Brady v. Prairie Material Sales, Inc.

• Decision Date: 02 November 1989
• Docket Number: No. 2-88-1231,2-88-1231
• Citation: 137 Ill.Dec. 857,190 Ill.App.3d 571,546 N.E.2d 802
• Parties: , 137 Ill.Dec. 857 Thomas BRADY et al., Plaintiffs-Appellants, v. PRAIRIE MATERIAL SALES, INC., Defendant-Appellee (Bruce R. Nagel, et al., Defendants).
• Court: United States Appellate Court of Illinois

Page 802

546 N.E.2d 802

190 Ill.App.3d 571, 137 Ill.Dec. 857

Thomas BRADY et al., Plaintiffs-Appellants, v. PRAIRIE MATERIAL SALES, INC., Defendant-Appellee (Bruce R Nagel, et al., Defendants).

No. 2-88-1231.

Appellate Court of Illinois,

Second District.

Nov. 2, 1989.

John C. Lorenzen (argued), John J. Henely, Ltd., Chicago, for Thomas Brady, Linda Brady.

Thomas P. Scherschel, Querrey & Harrow, Ltd., Geneva, Puckett, Barnett, Larson, Mickey, Wilson & Ochsen, Aurora, for Bruce R. Nagel, Keith A. Brogan, Louis Ruffolo & Son Const., Clara Lund.

D. Kendall Griffith, Thomas A. Brabec, Stephen R. Swofford (argued), Gerald Haberkorn, Hinshaw, Culbertson, Moelmann, Hoban & Fuller, LaSalle, for Prairie Material Sales, Inc.

Justice LINDBERG delivered the opinion of the court:

Plaintiffs, Thomas and Linda Brady, appeal from an order of the circuit court of Kane County granting defendant Prairie Material Sales Inc.'s motion to dismiss with prejudice pursuant to section 2-619 of the Code of Civil Procedure (Code) (Ill.Rev.Stat.1987, ch. 110, par. 2-619). The trial court entered the required finding of "no just reason to delay enforcement or appeal," and plaintiffs filed a timely notice of appeal pursuant to Supreme Court Rule 304 (107 Ill.2d R. 304). The issue on appeal is whether a written settlement agreement entered into by plaintiffs with defendant's employee, Bruce Nagel, operates to discharge defendant.

Plaintiff Thomas Brady was working in his office in a building adjacent to Route 53 in the Village of Bolingbrook, Illinois, on November 18, 1986. It was snowing heavily. Bruce Nagel was hauling a load of gravel north on Route 53 for his employer, defendant. A car, driven by Keith Brogan, traveling southbound on Route 53 swerved into Bruce Nagel's lane, and in avoiding Brogan, Bruce Nagel lost control of his truck, went off the road and crashed into the building in which plaintiff Thomas Brady was working. Plaintiff was seriously injured and requires constant medical attention which costs $10,000 to $12,000 per month.

Plaintiffs filed suit for personal injuries and loss of consortium against Keith Brogan, Bruce Nagel and defendant. Plaintiffs' counts against Keith Brogan and Bruce Nagel were based on theories of negligence. Plaintiffs' count against defendant was based solely on a theory of respondeat superior and sought to hold defendant liable for the alleged negligent driving of its employee, Bruce Nagel.

Plaintiffs entered into a written settlement agreement with Bruce Nagel and Bruce Nagel's personal insurance carrier, West Bend Mutual Insurance Co. (West Bend). Plaintiff Thomas Brady accepted $80,000 and his wife, Linda Brady, accepted $20,000. Bruce Nagel's policy had a limit of $100,000. In return, plaintiffs released Bruce Nagel and West Bend from further liability for the accident as evidenced by the written settlement agreement, whose construction and interpretation is at issue in this appeal. Plaintiffs filed a motion for a good-faith finding pursuant to section 2(c) of the Contribution Among Joint Tortfeasors Act (Contribution Act) (Ill.Rev.Stat.1987, ch. 70, par. 302(c)), and the trial court granted the motion and dismissed Bruce Nagel and West Bend from the suit.

Defendant then filed its motion to dismiss pursuant to section 2-619 of the Code (Ill.Rev.Stat.1987, ch. 110, par. 2-619), arguing that the written settlement agreement constituted a full release of all claims and other parties including defendant. Plaintiffs responded that the instrument was a covenant not to sue and only released those parties specifically named, Bruce Nagel and West Bend. In support, plaintiffs filed the affidavit of their attorney and the attorney for Bruce Nagel which stated that the instrument was only intended by these attorneys to release Bruce Nagel and West Bend from further liability and was not intended to release defendant. Defendant was not named in the instrument. Defendant did not pay any consideration for the agreement. The trial court, without relying on the supporting affidavits by the attorneys filed by plaintiffs, ruled that the agreement discharged defendant from liability to plaintiffs and granted defendant's motion.

In construing written settlement agreements between an injured party and those sought to be held liable, the issue is often framed in terms of whether the instrument is a release or a covenant not to sue. (Pate v. City of Sesser (1979), 75 Ill.App.3d 233, 30 Ill.Dec. 799, 393 N.E.2d 1146.) A release is said to extinguish a cause of action, while a covenant not to sue affects only the right to bring suit and not the underlying cause of action itself. (Pate v. City of Sesser (1979), 75 Ill.App.3d 233, 30 Ill.Dec. 799, 393 N.E.2d 1146.) An unqualified release of one joint tortfeasor operated to discharge all other joint tortfeasors while a covenant not to sue one joint tortfeasor did not release all other joint tortfeasors. (Pate v. City of Sesser (1979), 75 Ill.App.3d 233, 30 Ill.Dec. 799, 393 N.E.2d 1146; cf. Stewart v. Village of Summit (1986), 114 Ill.2d 23, 101 Ill.Dec. 862, 499 N.E.2d 450 (covenant not to sue employee which contains no express reservation of rights to sue others is interpreted as evidencing intent to bar covenantor's cause of action in respondeat superior against employee's employer, while covenant not to sue employee which contains a general reservation of rights clause in favor of covenantor expresses intent to preserve right of covenantor to proceed against employee's employer on a theory of respondeat superior ).) However, framing the issue as whether an instrument is a release or a covenant not to sue and thereby releases other persons not a party to the agreement distorts the real issue, which is a determination of the intent of the parties to the agreement. Stewart v. Village of Summit (1986), 114 Ill.2d 23, 101 Ill.Dec [137 Ill.Dec. 860] 862, 499 N.E.2d 450; Pate v. City of Sesser (1979), 75 Ill.App.3d 233, 30 Ill.Dec. 799, 393 N.E.2d 1146.

Whether called a release or a covenant not to sue, the written agreement is a contract and subject to the normal rules of contract construction and interpretation. (Wysocki v. Upjohn Co. (1987), 157 Ill.App.3d 868, 109 Ill.Dec. 926, 510 N.E.2d 994.) Where a written instrument evidencing an agreement is clear and unambiguous, the meaning of the instrument and the intention of the parties is to be determined from the face of the instrument without resort to parol evidence or any other extrinsic aids. (Rakowski v. Lucente (1984), 104 Ill.2d 317, 84 Ill.Dec. 654, 472 N.E.2d 791.) The instrument which plaintiff Thomas Brady signed and delivered to Bruce Nagel and West Bend provided:

"RELEASE OF ALL CLAIMS

KNOWN ALL MEN BY THESE PRESENTS:

That the undersigned, THOMAS BRADY being of lawful age, for the sole consideration of the sum of EIGHTY THOUSAND AND NO/100

* * * * * * *Dollars ($80,000.00) to the undersigned in hand paid, the receipt and sufficiency of which is hereby acknowledged, does hereby for myself and for my heirs, executors, administrators, successors and assigns release, acquit and forever discharge Bruce Nagel and West Bend Mutual Insurance Company and his, her, their, or its agents, servants, successors, heirs, executors, administrators, officers, directors and employees and insurers, and all other persons, firms, corporations, associations, partnerships or other entities, of and from any and all claims, actions, causes of action, demands, rights, damages, costs, loss of service, expenses and compensation whatsoever, which the undersigned has had, now has, or which may hereafter accrue on account of or in any way growing out of any and all known and unknown, foreseen and unforeseen bodily and personal injuries and property damages, and the conse quences thereof, resulting or to result from an accident, which occurred on or about the 18th day of November, 1986, at or near Illinois Route 53 at its intersection with Royce Road, Village of Bolingbrook, County of Will, State of Illinois.

It is understood and agreed that this settlement is the compromise of a doubtful and disputed claim, and that this settlement and the payment made pursuant thereto are not to be construed as an admission of liability on the part of the party or parties hereby released, and that the party or parties hereby released deny any and all liability with respect to the aforesaid accident and intend merely to avoid litigation and buy their peace.

The undersigned understands and hereby declares and represents that the injuries sustained are or may be permanent and progressive in nature and that recovery therefrom is uncertain and indefinite and that there may be unknown or unanticipated injuries, losses, medical expenses, and other expenses or damages resulting from the aforesaid accident and that in executing this Release it is understood and agreed that this Release is intended to include all such injuries, losses, medical expenses and other expenses or damages.

This release expressly reserves all rights of the person, or persons, or entities on whose behalf the payment is made and the rights of all persons and parties in privity or connected with them, and expressly reserves to them their right to pursue any and all of their legal remedies, if any, including but not limited to claims for contribution, indemnity, property damage and personal injury against the undersigned or those in privity or connected with the undersigned.

This Release contains the entire agreement between the parties hereto, and the terms of this Release are contractual and not a mere recital." (Emphasis added.)

Plaintiff Linda Brady signed an identical instrument, except the amount received was $20,000.

We construe this instrument to be an unqualified release by plaintiffs of all causes of actions or other rights of plaintiffs against any person or entity including defendant which arose or might arise out of the accident and resulting injuries...