Great Am. Ins. Co. of N.Y. v. Heneghan Wrecking & Excavating Co.

• Decision Date: 11 December 2015
• Docket Number: Nos. 1–13–3376,1–13–3486.,s. 1–13–3376
• Citation: 46 N.E.3d 859
• Parties: GREAT AMERICAN INSURANCE COMPANY OF NEW YORK, as Subrogee of 600 Wabash Commercial, LLC; American Economy Insurance Company, as Subrogee of Moonstone Foods Enterprises, LLC; Society Insurance, a Mutual Company, as Subrogee of Charming Food Network, Inc., d/b/a Tamarind; and First National Insurance Company of America, as Subrogee of Wabash KPX, Inc., Plaintiffs–Appellants, v. HENEGHAN WRECKING AND EXCAVATING COMPANY, INC., Concord Construction and Management, Inc., and the City of Chicago, Defendants–Appellees (Lorraine P. Phillips, Defendant). The Estate of Lorraine P. Phillips, Counterplaintiff–Appellant, v. Heneghan Wrecking and Excavating Company, Inc., Counterdefendant–Appellee.
• Court: United States Appellate Court of Illinois

46 N.E.3d 859

GREAT AMERICAN INSURANCE COMPANY OF NEW YORK, as Subrogee of 600 Wabash Commercial, LLC; American Economy Insurance Company, as Subrogee of Moonstone Foods Enterprises, LLC; Society Insurance, a Mutual Company, as Subrogee of Charming Food Network, Inc., d/b/a Tamarind; and First National Insurance Company of America, as Subrogee of Wabash KPX, Inc., Plaintiffs–Appellants

v.HENEGHAN WRECKING AND EXCAVATING COMPANY, INC., Concord Construction and Management, Inc., and the City of Chicago, Defendants–Appellees (Lorraine P. Phillips, Defendant).

The Estate of Lorraine P. Phillips, Counterplaintiff–Appellant

v.Heneghan Wrecking and Excavating Company, Inc., Counterdefendant–Appellee.

Nos. 1–13–3376

1–13–3486.

Appellate Court of Illinois, First District, Fifth Division.

Dec. 11, 2015.

Andreou & Casson Ltd., Chicago (Frand J. Andreou, of counsel), for appellant Estate of Lorraine P. Phillips.

Taft Stettinius & Hollister LLP, Chicago (J. Timothy Eaton and Jonathan B. Amarilio, of counsel), for other appellants.

Traub Lieberman Straus & Shrewsberry LLP, Chicago (Mark F. Wolfe, Natalie M. Limber, and Katherine M. Kelleher, of counsel), for appellees Heneghan Wrecking & Excavating Company, and Concord Construction & Management, Inc.

Stephen R. Patton, Corporation Counsel, Chicago (Benna Ruth Solomon, Myriam Zreczny Kasper, and Stephen G. Collins, Assistant Corporation Counsel, of counsel), for appellee City of Chicago.

OPINION

Justice LAMPKIN

delivered the judgment of the court, with opinion.

¶ 1 Plaintiffs, Great American Insurance Company of New York, as subrogee of 600 Wabash L.P. and 600 S. Wabash Commercial, LLC, American Economy Insurance Company, as subrogee of Moonstone Foods Enterprises, LLC, Society Insurance, a mutual company, as subrogee of Charming Food Network, Inc. d/b/a Tamarind, and First National Insurance Company of America, as subrogee of Wabash KPX, Inc. (collectively insurance plaintiffs), and counter-plaintiff, the Estate of Lorraine Phillips (Estate),¹ appeal the circuit court's order granting partial summary judgment in favor of defendants, Heneghan Wrecking and Excavating Co., Inc. (Heneghan), Concord Construction and Management (Concord), and the City of Chicago (City), finding defendants, and specifically Heneghan with regard to the Estate, were not strictly liable for the damages caused by the demolition of the building located at 630 S. Wabash Avenue in Chicago, Illinois, commonly known as the Wirt Dexter building. The Estate additionally contends the circuit erred in denying its motion for a judgment notwithstanding the jury's verdict or, in the alternative, its motion for a new trial where the jury's verdict in favor of Heneghan on the Estate's negligence counterclaim was not supported by the evidence. Based on the following, we affirm.

¶ 2 FACTS

¶ 3 The following factual summary was provided by the circuit court:

“The Plaintiffs filed the underlying subrogation action against the Defendants in which they seek redress for certain purported property damages, lost profits, and expenses incurred as a result of a building fire and subsequent demolition at the building located at 630 South Wabash Avenue, Chicago, Illinois (‘subject premises') [or Wirt Dexter building]. On August 24, 2006, a fire ignited within the subject premises purportedly as a result of sparks or slag that came into contact with combustible material while an individual, Efram Lee, allegedly hired by the owner of the subject premises, used an oxygen acetylene torch to cut up two boilers located in the basement of the subject premises. The Plaintiffs allege that the fire caused a substantial portion of the roof and interior supports of the building to become charred and collapse, thereby leaving the exterior walls to self-support themselves.

On October 25, 2006, the City filed an emergency petition and amended complaint in which it sought authorization from the Municipal Division of the Circuit Court of Cook County, Illinois to immediately demolish the subject premises. That same day, the Honorable Judge Daniel J. Lynch ordered an emergency demolition of the subject premises after finding that it was dangerous, unsafe, and beyond reasonable repair under the Illinois Municipal Code 65 ILCS 5/11–31–1

and the Municipal Code of Chicago 13–12–130. The Court further found that an emergency demolition was the only way to protect the public health, safety, and welfare of the general public. The record reflects that the City accepted bids from various contractors and thereafter hired Heneghan and Concord to conduct the demolition of the subject premises.

During the afternoon of October 25, 2006, Heneghan began demolition of the subject premises by first removing the bricks and steel columns of the western wall of the building that abutted the Chicago Transit Authority (‘CTA’) elevated rail tracks until the west wall become level to the height of the tracks. Then, Heneghan removed portions of the south and north walls. Later, during the evening of October 25, 2006, or during the early morning hours of October 26, 2006, the structure collapsed, specifically the north wall, allegedly causing damage to the Plaintiff insureds' building location at 600 South Wabash Avenue, Chicago, Illinois (‘600 Wabash’).”

Damages also were alleged to the building located at 632 S. Wabash Avenue, which was owned by the Estate as well. In fact, on October 30, 2006, the City authorized Heneghan to demolish the 632 S. Wabash building because the building had been so damaged by fire that it constituted an actual and imminent danger to the public. The building subsequently was demolished pursuant to the City's directive.

¶ 4 The insurance plaintiffs filed a subrogation action against defendants alleging common law and statutory strict liability and negligence for the damage caused to the 600 building and brought a suit against the Estate for negligence and res ipsa loquitur. The Estate then filed an action against Heneghan alleging strict liability and negligence for the damage caused to the 632 building. After litigating the sufficiency of the pleadings for approximately six years, the insurance plaintiffs moved for partial summary judgment on their common law and statutory strict liability claims against defendants. Heneghan and Concord responded and filed a cross-motion for partial summary judgment on the same claims. The City opposed the insurance plaintiffs' motion, but did not file its own cross-motion for partial summary judgment.

¶ 5 In a December 28, 2012, written order, the circuit court entered partial summary judgment in favor of Heneghan and Concord against the insurance plaintiffs and the Estate on the common law strict liability claims, finding the demolition of the Wirt Dexter building did not constitute an ultrahazardous activity based on the factors set forth in Section 520 of the Restatement (Second) of Torts (Restatement (Second) of Torts § 520 (1977)

). A judgment of no liability was entered in favor of Heneghan and Concord on the common law strict liability claims. The circuit court, however, denied the insurance plaintiffs' motion with regard to its statutory strict liability claim against the City pursuant to section 1–4–7 of the Illinois Municipal Code (65 ILCS 5/1–4–7 (West 2006) ), finding there were questions of fact that remained as to whether the demolition was a substantial factor in the collapse of the northern wall of the Wirt Dexter building. The circuit court further denied Heneghan and Concord's motion for partial summary judgment for negligence and res ipsa loquitur, finding there were questions of fact preventing entry of judgment as a matter of law regarding whether Heneghan and Concord were in exclusive control of the instrumentality that caused the insurance plaintiffs' injuries.

¶ 6 On February 5, 2013, the circuit court entered an order granting the City's motion to dismiss the insurance plaintiffs' common law strict liability claims in light of its December 28, 2012, order, finding that, because Heneghan and Concord were not engaged in ultrahazardous activity, the City, therefore, was not liable.

¶ 7 Prior to trial, on February 22, 2013, the circuit court considered the City's motion in limine to, inter alia, bar consideration of the statutory strict liability claim brought against it pursuant to section 1–4–7 of the Municipal Code, arguing the statute's language was “too confusing for the average person of common intelligence to comprehend.” Following a lengthy discussion between the parties and the court, the circuit court granted the motion in limine. The circuit court opined that the jury should not see the text of the statute because it “fail[ed] to identify any specific type of conduct to which the City of Chicago was required to conform.” The circuit court reaffirmed its ruling on March 5, 2013.

¶ 8 A trial ensued on the insurance plaintiffs' negligence claims against defendants, the insurance plaintiffs' negligence claim against the Estate, and the Estate's negligence claim against Heneghan. During the course of trial, the insurance plaintiffs settled their negligence claim with the Estate. On March 13, 2013, a jury returned a verdict in favor of defendants on the remaining claims.

¶ 9 The insurance plaintiffs and the Estate subsequently filed posttrial motions for judgment notwithstanding the verdict or, in the alternative, for a new trial, claiming the circuit court erred in dismissing their strict liability claims and that the jury's verdict was not supported by the evidence. On October 8, 2013, in a written order, the circuit court denied the posttrial motions, finding the strict liability claims failed as a matter of law and upholding the jury's negligence verdicts.

¶ 10 The insurance plaintiffs and the Estate timely appealed.

¶ 11 ANALYSIS

¶ 12 I. Strict Liability

¶ 13 The insurance plaintiffs and the Estate contend the circuit court erred in entering partial summary judgment on their common law strict...