Hall v. Burger

• Decision Date: 28 February 1996
• Docket Number: No. 4-95-0195,4-95-0195
• Citation: 660 N.E.2d 1328,214 Ill.Dec. 379,277 Ill.App.3d 757
• Parties: , 214 Ill.Dec. 379 Mary A. HALL, Administrator of the Estate of Howard E. Hall, Mary A. Hall, Regina Hall and Jeremy Hall, Plaintiffs-Appellants, v. Lisa A. BURGER, Robert S. Hedrick, Larry D. Medaris, Country Mutual Insurance Company, Country Casualty Insurance Company, Defendants-Appellees.
• Court: United States Appellate Court of Illinois

Page 1328

660 N.E.2d 1328

277 Ill.App.3d 757, 214 Ill.Dec. 379

Mary A. HALL, Administrator of the Estate of Howard E. Hall Mary A. Hall, Regina Hall and Jeremy Hall Plaintiffs-Appellants, v. Lisa A. BURGER, Robert S. Hedrick, Larry D. Medaris, Country Mutual Insurance Company, Country Casualty Insurance Company, Defendants-Appellees.

No. 4-95-0195.

Appellate Court of Illinois Fourth District.

Argued Oct. 18, 1995.

Decided Jan. 31, 1996.

Rehearing Denied Feb. 28, 1996.

Richard H. Balog (argued), St. Charles, Thomas E. Doyle (argued), Taylorville, for Mary A. Hall Adm., Estate of Howard E. Hall.

Evan H. Johnson, Michael A. Walsh (argued), Erickson, Davis, Murphy, Johnson, Griffith & Walsh, Ltd., Decatur, for Country Mutual Insurance Company.

Howard W. Small, Bianca I. Truitt (argued), Thomas, Mamer & Haughey, Champaign, for Larry D. Medaris.

Justice GARMAN delivered the opinion of the court:

Plaintiffs appeal the trial court's grant of summary judgment for their insurance company and insurance agent. We affirm in part, reverse in part, and dismiss in part.

Howard Hall (decedent) died in a car accident in August 1988. He was hit by a car driven by Lisa Burger, belonging to Robert Hedrick. Mary Hall (claimant), decedent's widow and administrator of his estate, settled with both defendants for maximum limits on their policies, $50,000 and $25,000, respectively. The Halls had four separate insurance policies with Country Mutual Insurance Company (insurer), each of which contained underinsured motorist (UDIM) coverage. Two of the policies about which there is no dispute had such coverage with a $100,000 per person limit of liability, and one (the one for the vehicle decedent was driving at the time of the accident) had a limit of $50,000 per person. The disputed policy had a $100,000 per person limit.

Each policy contained the following identical provision, a section titled "AGREEMENT" on the first page of the "UNDERINSURED MOTORISTS INSURANCE ENDORSEMENT":

"If you have paid for this coverage (see the declarations page), we will pay damages which an insured is legally entitled to recover from the owner or operator of an underinsured motor vehicle because of bodily injury sustained by an insured and caused by an accident. The owner's or operator's liability for these damages must arise from the ownership, maintenance, or use of the underinsured motor vehicle.

The limits of liability for this coverage will be reduced by those amounts actually recovered under the applicable bodily injury insurance policies, bonds, or other security maintained on the underinsured motor vehicle."

Each also contained the following "antistacking" clause:

"7. Other Vehicle Insurance in the Company. If this policy and any other vehicle insurance policy issued to you by this Company apply to the same accident, the maximum limit of our liability under all the policies will not exceed the highest applicable limit of liability under any one policy."

And the per-person limits of liability section in each policy stated:

"2. Limits of Liability. The Underinsured Motorists limits of liability shown on the declarations page for Uninsured Motorists, Coverage U apply as follows:

a. The limit of liability for 'each person' is the maximum amount we will pay for bodily injury sustained by one person in any one accident. That maximum amount includes any claims of other persons for damages arising out of that bodily injury. The figure listed is the most we will pay for any one person in any one accident regardless of the number of insureds, claims made, insured vehicles, premiums shown on the declarations page, or underinsured motor vehicles."

Cross-motions for summary judgment came before the court in February 1995. The insurer had already paid claimant $25,000, which it claimed was all it owed. This amount was arrived at by subtracting $75,000, the amount recovered from both defendants' settlements, from $100,000, the highest limit of liability on any one of claimant's insurance policies. The trial court granted the insurer's motion, holding it owed no more than this amount and it was not liable for bad-faith attempt to settle. The trial court had earlier held that the insurer should be allowed to offset the full $75,000 recovered from tortfeasors. The parties stipulated that plaintiffs' damages exceed $200,000.

Plaintiffs claim that each of the above policy provisions is ambiguous. They claim error in the summary judgment because ambiguity is to be construed in favor of the insured. They claim further that important public policy mandates an outcome in their favor, both in terms of the maximum amount recoverable and in terms of what the insurer should be allowed to set off. As a further count with respect to the insurer, they claim it was error for the trial court not to award them damages for insurer's "bad-faith attempt to settle."

Plaintiffs also sued Larry Medaris, the insurance agent who sold the Halls the policies in question. The first claim, unrelated to the above allegations with respect to the policies, is that Medaris breached a duty to the plaintiffs by failing to obtain death benefits coverage they had requested on the truck being driven when the accident occurred. Medaris obtained summary judgment on this claim in February 1995, at the same time as the insurer. The second claim against him alleged a violation of section 2 of the Consumer Fraud and Deceptive Business Practices Act (Act) (815 ILCS 505/2 (West 1992)), by his having broken a promise to provide "full" UDIM coverage. This claim was dismissed in October 1991 for failure to state a claim upon which relief could be granted. On appeal claimant also contends Medaris "made a false representation as to the value of the coverage since it possessed no value" if some of the UDIM coverage is of no value (i.e., cannot be stacked).

I. ANALYSIS

A court properly grants summary judgment when the pleadings, depositions, and affidavits show no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. (735 ILCS 5/2-1005(c) (West 1992); Wright v. St. John's Hospital of the Hospital Sisters of the Third Order of St. Francis (1992), 229 Ill.App.3d 680, 682-83, 171 Ill.Dec. 250, 252, 593 N.E.2d 1070, 1072.) The standard of review is de novo. Wright, 229 Ill.App.3d at 683, 171 Ill.Dec. at 252, 593 N.E.2d at 1072.

In construing a summary judgment motion, the trial court must view all evidence in a light most favorable to the nonmovant. (Gilbert v. Sycamore Municipal Hospital (1993), 156 Ill.2d 511, 518, 190 Ill.Dec. 758, 762, 622 N.E.2d 788, 792.) On defendant's motion for summary judgment, plaintiff need not establish his case as he would at trial. However, he must present some factual basis which would arguably entitle him to judgment. (West v. Deere & Co. (1991), 145 Ill.2d 177, 182, 164 Ill.Dec. 122, 124, 582 N.E.2d 685, 687; Northrop v. Lopatka (1993), 242 Ill.App.3d 1, 4, 182 Ill.Dec. 937, 940, 610 N.E.2d 806, 809.) If the movant supplies facts which if uncontradicted would entitle the party to judgment as a matter of law, the opponent cannot rely solely on his pleadings to raise issues of material fact. Thus, uncontradicted facts contained in the movant's affidavit are admitted and must be taken as true for purposes of the motion. (Purtill v. Hess (1986), 111 Ill.2d 229, 240-41, 95 Ill.Dec. 305, 309-10, 489 N.E.2d 867, 871-72.) However, the party opposing the motion need not file any counteraffidavits to create a material question of fact unless the movant presents evidence which precludes any possible liability. Motz v. Central National Bank (1983), 119 Ill.App.3d 601, 604-05, 75 Ill.Dec. 137, 140-41, 456 N.E.2d 958, 961-62.

A. Insurance Company

When a provision in an insurance policy is ambiguous or is susceptible of at least two reasonable interpretations, it should be construed in favor of the insured. (Squire v. Economy Fire & Casualty Co. (1977), 69 Ill.2d 167, 180, 13 Ill.Dec. 17, 22, 370 N.E.2d 1044, 1049; Bailey v. Auto-Owners Insurance Co. (1992), 229 Ill.App.3d 514, 516, 170 Ill.Dec. 453, 454, 592 N.E.2d 1133, 1134; Gibbs v. Madison Mutual Insurance Co. (1993), 242 Ill.App.3d 147, 153, 182 Ill.Dec. 719, 724, 610 N.E.2d 143, 148, appeal denied (1993), 151 Ill.2d 563, 186 Ill.Dec. 380, 616 N.E.2d 333.) Provisions should be read in context, however, not in isolation. (See Glidden v. Farmers Automobile Insurance Association (1974), 57 Ill.2d 330, 336, 312 N.E.2d 247, 250.) Courts should not distort language to reach a desired result. (See Illinois Farmers Insurance Co. v. Tabor (1994), 267 Ill.App.3d 245, 251-52, 204 Ill.Dec. 697, 701, 642 N.E.2d 159, 163.) When a clause is unambiguous it should be applied as written, unless it contravenes public policy. Bailey, 229 Ill.App.3d at 516, 170 Ill.Dec. at 454-55, 592 N.E.2d at 1134-35.

1. Limit of Liability

Decedent had four insurance policies with insurer, each of which contained UDIM coverage. Plaintiffs argue first that the antistacking clause (identical in each policy) is ambiguous, and therefore all of the policies should be stacked, with a resulting limit of liability of $350,000. In the alternative, they argue the limit should at least be $200,000, because there are two distinct tortfeasors, which creates a latent ambiguity since the "agreement" section refers to the "owner's or operator's liability." (Emphasis added.) Finally, plaintiffs argue that even if we find the provisions unambiguous one of the above conclusions should be reached because of public policy.

The antistacking clause in question states: "If this policy and any other vehicle insurance policy issued to you by this Company apply to the same accident, the maximum limit of our liability under all the policies will not exceed the highest applicable limit of liability under any one policy." (Emphasis added.) This exact phrase has been found unambiguous by the Supreme Court of Illinois. (...