Fidelity and Cas. Co. v. Merridew

• Decision Date: 17 December 2001
• Docket Number: No. 1-00-2849.,1-00-2849.
• Citation: 261 Ill.Dec. 1,327 Ill. App.3d 51,762 N.E.2d 570
• Parties: FIDELITY AND CASUALTY COMPANY, Plaintiff-Appellee, v. Doris MERRIDEW, as Adm'r of the Estate of Reginald Merridew, and Doris Merridew, Indiv., Defendants-Appellants.
• Court: United States Appellate Court of Illinois

762 N.E.2d 570

327 Ill. App.3d 51

261 Ill.Dec. 1

FIDELITY AND CASUALTY COMPANY, Plaintiff-Appellee, v. Doris MERRIDEW, as Adm'r of the Estate of Reginald Merridew, and Doris Merridew, Indiv., Defendants-Appellants.

No. 1-00-2849.

Appellate Court of Illinois, First District, First Division.

December 17, 2001.

Michael Resis, O'Hagan, Smith & Amundsen, LLC, Chicago, for Appellee.

Bruce Goodhart, Michael J. Perona, Chicago, for Appellants.

Justice COUSINS delivered the opinion of the court:

In June 1997, Reginald Merridew was involved in an automobile accident with a vehicle driven by Jack Torcolese. Reginald Merridew filed an action against Torcolese seeking damages for his bodily injuries. His wife, Doris Merridew, brought an action against Torcolese alleging loss of consortium. Torcolese was insured for automobile liability by Unitrin Property & Casualty Company (Unitrin). The Merridews were insured by Fidelity & Casualty Company (Fidelity). After the suits were settled, Doris Merridew made a claim against Fidelity for underinsured motorist coverage. Fidelity sought a declaration that it did not owe underinsured motorist coverage to Doris Merridew or to Reginald Merridew's estate. Fidelity subsequently filed a motion for summary judgment. Doris Merridew filed a cross-motion for summary judgment against Fidelity. On July 19, 2000, the trial court granted Fidelity's motion for summary judgment and denied Doris' cross-motion for summary judgment.

Doris Merridew, individually and as special administrator of Reginald's estate, now appeals the trial court's July 19, 2000, order. Doris Merridew presents the following issue upon appeal: whether Torcolese was an underinsured motorist pursuant to the terms of the Fidelity policy.

BACKGROUND

On June 11, 1997, 81-year-old Reginald Merridew was involved in an automobile collision with Jack Torcolese. Merridew was hospitalized for over 90 days and his medical expenses exceeded $300,000. Merridew filed a personal injury suit against the driver. His wife, Doris Merridew, brought a loss of consortium suit. In July 1998, Reginald Merridew died after undergoing gallstone surgery that was unrelated to the accident. On August 10, 1998, Doris Merridew was appointed special administrator of Reginald Merridew's estate.

At the time of the accident, Torcolese was insured by Unitrin. The policy issued by Unitrin contained a single liability limit of $500,000. Reginald Merridew and Doris Merridew were named insureds on a motor vehicle insurance policy issued by Fidelity for the period covering September 9, 1996, through September 9, 1997. The Fidelity policy included an underinsured motorist coverage endorsement with a $500,000 limit for underinsured motorist liability coverage. The underinsured motorist coverage endorsement provides:

"DEFINITIONS

* * *

1. Covered Person means:

a. You for the ownership, maintenance or use of any vehicle;

* * *

5. Underinsured Motor Vehicle means a land motor vehicle or trailer of any type to which a bodily injury liability bond or policy applies at the time of the accident but its limit for bodily injury liability:

a. Is less than the limit of liability for Underinsured Motorists coverage.

b. Has been reduced by payments to other p[e]rsons injured in the accident to an amount less than the limit of liability for this coverage.

* * *

INSURING AGREEMENT

We will pay compensatory damages which any covered person is legally entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury:

1. Sustained by any covered person; and

2. Caused by an accident arising out of the ownership, maintenance or use of an underinsured motor vehicle.

* * *

LIMIT OF LIABILITY

1. The limit of liability shown in the Coverage Summary for this coverage is our maximum limit of liability for all damages, resulting from any one motor vehicle accident.

This is the most we will pay regardless of the number of:

a. Covered persons;

b. Claims or suits made;

c. Vehicles involved in an accident or shown in the Coverage Summary;

d. Persons who sustain injury or damage * * *.

* * *

2. Except in the event of a settlement agreement, the limit of liability shall be reduced by all sums paid because of the bodily injury by or on behalf of persons or organizations who may be legally responsible." (Emphasis original and added.)

Reginald Merridew's underlying personal injury action was settled on behalf of his estate in the amount of $350,000. The loss of consortium action on behalf of Doris Merridew was settled for $150,000.

Doris Merridew and the estate of Reginald Merridew subsequently filed a claim against Fidelity for underinsured motorist coverage. On May 19, 1999, Fidelity filed a complaint for declaratory judgment seeking the following determinations:

"A. That the accident of June 11, 1997 involving Reginald Merridew and Jack Torcolese did not involve an underinsured motor vehicle as defined by the Fidelity & Casualty policy.

B. That the Unitrin policy issued to Jack Torcolese contained a single limit of liability coverage in the amount of $500,000, which Unitrin paid for the bodily injury sustained by Reginald Merridew.

C. That Fidelity & Casualty Company owes no Underinsured Motor Vehicle Coverage to the Estate of Reginald Merridew and/or Doris Merridew."

Doris Merridew, individually and as administrator of Reginald Merridew's estate, filed an answer to Fidelity's complaint for declaratory judgment. Fidelity filed a motion for summary judgment, asserting that no underinsured motorist coverage was owed under its policy. Doris Merridew filed a cross-motion for summary judgment asserting that because the estate of Reginald Merridew only received $350,000, the estate was entitled to an additional $150,000 of coverage and since Doris Merridew received only $150,000, she was entitled to an additional $350,000. On July 19, 2000, the trial court entered an order granting Fidelity's motion for summary judgment and denying Doris Merridew's cross-motion for summary judgment. Doris Merridew now appeals.

We affirm.

ANALYSIS

Where there are no genuine issues of material fact, summary judgment is a proper method of disposing of a cause. Bailey v. Allstate Development Corp., 316 Ill.App.3d 949, 953, 250 Ill.Dec. 225, 738 N.E.2d 189 (2000). Accordingly, appellate review of an order granting summary judgment is de novo. Zekman v. Direct American Marketers, Inc., 182 Ill.2d 359, 374, 231 Ill.Dec. 80, 695 N.E.2d 853 (1998).

Principally, we must determine whether Torcolese's vehicle was considered an underinsured motor vehicle, enabling Doris to state a claim against Fidelity for underinsured motorist benefits. In examining whether the vehicle was underinsured, we will review the underinsured motor vehicle provision of the Illinois Insurance Code (215 ILCS 5/143a-2(4) (West 1996)) and Fidelity's underinsured motor vehicle endorsement. Section 143a-2(4) of the Illinois Insurance Code defines an underinsured motor vehicle as follows:

"For the purpose of this Code the term `underinsured motor vehicle' means a motor vehicle whose ownership, maintenance or use has resulted in bodily injury or death of the insured, as defined in the policy, and for which the sum of the limits of liability under all bodily injury liability insurance policies or under bonds or other security required to be maintained under Illinois law applicable to the driver or to the person or organization legally responsible for such vehicle and applicable to the vehicle, is less than the limits for underinsured coverage provided the insured as defined in the policy at the time of the accident. The limits of liability for an insurer providing underinsured motorist coverage shall be the limits of such coverage, less those amounts actually recovered under the applicable bodily injury insurance policies, bonds or other security maintained on the underinsured motor vehicle. However, the maximum amount payable by the underinsured motorist coverage carrier shall not exceed the amount by which the limits of the underinsured motorist coverage exceeds the limits of the bodily injury liability insurance of the owner or operator of the underinsured motor vehicle." (Emphasis added.) 215 ILCS 5/143a-2(4) (West 1996).

In construing a statutory provision, the primary goal is to ascertain and give effect to the legislature's intent. State Farm Fire & Casualty Co. v. Yapejian, 152 Ill.2d 533, 540-41, 178 Ill.Dec. 745, 605 N.E.2d 539 (1992). If the language of the statute is clear, it is unnecessary for the court to resort to other tools of statutory interpretation. Nottage v. Jeka, 172 Ill.2d 386, 392, 217 Ill.Dec. 298, 667 N.E.2d 91 (1996). The Illinois legislature enacted its provision for underinsured motorist coverage in order to place the insured in the same position he would have occupied if the tortfeasor had carried adequate insurance. Sulser v. Country Mutual Insurance Co., 147 Ill.2d 548, 555, 169 Ill. Dec. 254, 591 N.E.2d 427 (1992). Section 143a-2 (215 ILCS 5/143a-2 (West 1996)) is designed to offer insurance to "fill the gap" between the claim and the tortfeasor's insurance. Sulser, 147 Ill.2d at 556,169 Ill.Dec. 254,591 N.E.2d 427. The provision was intended to assure compensation for an insured's injuries in an amount equal to, but not exceeding, the limit of underinsured motorist coverage specified in the insured's policy. Koperski v. Arnica Mutual Insurance Co., 287 Ill.App.3d 494, 498, 222 Ill.Dec. 862, 678 N.E.2d 734 (1997).

We now turn to the pertinent provisions of the Fidelity insurance policy. Fidelity's underinsured motorist endorsement defines an underinsured motor vehicle as "a land motor vehicle or trailer of any type to which a bodily injury liability bond or policy applies at the time of the accident but its limit for bodily injury liability * * * [h]as been reduced by payments to other p[e]rsons injured in the accident to an amount less than the limit of liability for this...