Johnson v. United Airlines, 91894.

• Court: Supreme Court of Illinois
• Citation: 203 Ill.2d 121,784 N.E.2d 812,271 Ill.Dec. 258
• Docket Number: No. 91894.,91894.
• Parties: Luann JOHNSON, Surviving Spouse and Court-Appointed Adm'r of the Estate of William E. Johnson, Deceased, et al., v. UNITED AIRLINES et al. (Raytheon Aircraft Company, Appellant; City of Quincy, Appellee).
• Decision Date: 24 January 2003

784 N.E.2d 812
203 Ill.2d 121
271 Ill.Dec. 258

Luann JOHNSON, Surviving Spouse and Court-Appointed Adm'r of the Estate of William E. Johnson, Deceased, et al.,
v.
UNITED AIRLINES et al. (Raytheon Aircraft Company, Appellant; City of Quincy, Appellee)

No. 91894.

Supreme Court of Illinois.

January 24, 2003.

784 N.E.2d 815

Hugh C. Griffin, Sarah H. Dearing, of Lord, Bissell & Brook, Chicago, Richard E. Boyle, Kenneth L. Halvachs, Thomas R. Peters, of Gundlach, Lee, Eggmann, Boyle & Roesler, Belleville, for appellant

Brandt Madsen, of Madsen, Farkas & Powen, L.L.C., Chicago, Teresa L. Graham, of Dombroff & Gilmore, New York, New York, for appellee.

Chief Justice McMORROW delivered the opinion of the court:

Over the objection of Raytheon Aircraft Company (Raytheon), the circuit court of St. Clair County ruled that a settlement agreement entered into by the administrators of the estates of Johnson, Carlson, Fries, Berger, Beville, DeSalle, Hefflebower and Reed (plaintiffs herein) and the City of Quincy (Quincy) was made in good faith within the meaning of the Joint Tortfeasor Contribution Act (Contribution Act). 740 ILCS 100/0.01 et seq. (West 1996). That determination was affirmed by the appellate court. No. 5-98-0719 (unpublished order under Supreme Court Rule 23). Raytheon now appeals the finding of good faith before this court, arguing that the circuit court abused its discretion when it refused to allow discovery or to conduct an evidentiary hearing regarding Quincy's relative culpability before deciding that the settlement and release were made in good faith. Raytheon also asks this court to decide whether a nonsettling tortfeasor who challenges the good faith of a settlement has the burden of proving the absence of good faith by a preponderance of the evidence or by the higher "clear and convincing" standard.

For reasons that follow, we affirm the appellate court judgment upholding the circuit court's finding of good faith.

BACKGROUND

On November 19, 1996, United Express Flight 5925, carrying 10 passengers and a crew of two, attempted to land on runway 13 at Baldwin Field, a towerless municipal airport owned and operated by the City of Quincy in Adams County, Illinois. Runway 13 runs northwest and southeast. As United Express Flight 5925 was attempting to land, a small privately owned aircraft, Beechcraft A-90 King Air, Registration No. N1127D, piloted by Neil Reinwald and Laura Brooks Winkleman, attempted to take off at Baldwin Field on runway 4, which runs northeast and southwest. The two aircrafts collided at the intersection of the two runways, killing everyone aboard both aircrafts.

Representatives¹ of eight of the passengers aboard the United Express aircraft filed wrongful death and survival suits in St. Clair County, naming as defendants: United Airlines, Inc., and Great Lakes Aviation, Ltd., alleged to have operated United Express Flight 5925 as a joint enterprise; Katherine Gathje and Darin McCombs, the pilot and copilot of the United Express plane; Neil Reinwald and Laura Brooks Winkleman, the pilot and alleged copilot of the King Air aircraft; Robert Clarkson and Harvey Imber, co-owners of the King Air private aircraft; and Raytheon Aircraft Company, successor

784 N.E.2d 816

to Beech Aircraft Corporation, the manufacturer of the United Express aircraft. None of the plaintiffs filed suit against the City of Quincy

Raytheon filed third-party contribution claims against Quincy, alleging that Quincy was subject to liability in tort for the wrongful deaths of plaintiffs' decedents. The gravamen of the third-party complaints was that Quincy negligently failed to discharge its duty to business invitees to use ordinary care to provide reasonably safe ingress and egress from the airport. More specifically, Raytheon alleged that United Express Flight 5925 attempted to land at Baldwin Field using a straight-in approach, which violated standard traffic pattern procedure for towerless airports, that Quincy had been informed by the National Transportation Safety Board that commercial aircraft were landing at Baldwin Field using a straight-in approach, and that Quincy negligently failed to give appropriate or effective notice to all commercial airlines that they were required to conform their landings with standard traffic pattern procedures. Raytheon also moved to transfer venue in all of the cases to Adams County on grounds of forum non conveniens.

Quincy moved for the dismissal of the third-party actions. Quincy first argued that dismissal was required because St. Clair County was not the proper venue. Suit could only be brought against Quincy in Adams County because "[a]ctions must be brought against a * * * municipal * * * corporation in the county in which its principal office is located or in the county in which the transaction or some part thereof occurred out of which the cause of action arose." 735 ILCS 5/2-103 (West 1998). As an alternative argument, Quincy contended that the third-party contribution actions could not be maintained against it because it is absolutely immune from liability in tort pursuant to the Local Governmental and Governmental Employees Tort Immunity Act (745 ILCS 10/1-101 et seq. (West 1996)).

Before the trial court ruled on Quincy's motion to dismiss or Raytheon's motion to transfer venue, Quincy settled with each of the eight plaintiffs for a sum of $1,000 plus costs, conditioned on the plaintiffs' release of Quincy from all claims. Plaintiffs were also required to obtain a court ruling on the good faith of the settlement agreements and a dismissal of all third-party claims.

As required by the settlements, each plaintiff filed a motion seeking a good-faith ruling. The motions brought by plaintiffs Johnson, Carlson, and Fries were argued at a hearing before circuit court Judge Lloyd A. Cueto. The motions brought by the remaining five plaintiffs—Berger, Beville, DeSalle, Hefflebower and Reed— were argued at a hearing before circuit court Judge Michael J. O'Malley. Arguments presented at both hearings were substantially similar. Raytheon opposed the plaintiffs' motions, arguing that the settlements were not made in good faith or, alternatively, that a good-faith ruling would be premature at this juncture. Raytheon asked both judges to allow discovery and to conduct an evidentiary hearing to develop a factual basis for deciding whether the settlements were made in good faith.

Ruling independently, both circuit court judges denied the request for discovery and an evidentiary hearing. Both judges held that, in light of all the surrounding circumstances, the settling parties had established that the settlements were made in good faith and that Raytheon had not presented any evidence to overcome the presumption of good faith. The settlements were approved and Raytheon's third-party claims against Quincy were

784 N.E.2d 817

dismissed. The circuit court orders contained an express finding, pursuant to Supreme Court Rule 304(a) (155 Ill.2d R. 304(a)), that the judgment dismissing Quincy from all claims was final and appealable. Raytheon appealed and the cases were consolidated for review

The Fifth District of our appellate court affirmed the circuit court's good-faith ruling. The appellate court agreed that the settling parties had made a sufficient preliminary showing that the settlements had been made in good faith. The court also held that Raytheon had not met its burden of proving the absence of good faith by clear and convincing evidence. The appellate court rejected Raytheon's argument that a good-faith finding could not be made without determining the relative liability of the settling party and, consequently, held that the circuit court did not abuse its discretion by refusing to conduct an evidentiary hearing before deciding the good faith of the settlements.

Raytheon petitioned for leave to appeal and we granted the petition. 177 Ill.2d R. 315(a).

Raytheon raises two issues for our consideration. First, Raytheon asks this court to resolve a split among the lower courts as to the burden of proof imposed upon a nonsettling tortfeasor who challenges a settlement on the grounds that the transaction was not executed in good faith within the meaning of the Contribution Act. Raytheon contends that when challenging the good faith of a settlement, a nonsettling party has the burden of proving the absence of good faith by a preponderance of the evidence instead of the higher "clear and convincing" standard. Second, Raytheon asks this court to reverse the circuit court's ruling that the settlement between plaintiffs and Quincy was made in good faith. Raytheon contends that the settlement constitutes bad faith because the settlement amount of $1,000 per plaintiff is grossly disproportionate to the overall damages claimed by each plaintiff. Raytheon also contends that the circuit court could not have determined whether the settlement was made in good faith within the meaning of the Contribution Act without determining Quincy's relative culpability. Thus, Raytheon argues that the circuit court should have allowed discovery and conducted an evidentiary hearing so that a factual basis for determining Quincy's relative culpability could have been developed before a good-faith determination was made.

ANALYSIS

The Contribution Act was enacted by our legislature in 1979 as a codification of this court's decision in Skinner v. Reed-Prentice Division Package Machinery Co., 70 Ill.2d 1, 15 Ill.Dec. 829, 374 N.E.2d 437 (1977). See In re Guardianship of Babb, 162 Ill.2d 153, 205 Ill.Dec. 78, 642 N.E.2d 1195 (1994). The Contribution Act creates a statutory right of contribution in actions "where 2 or more persons are subject to liability in tort arising out of the same injury to person or property, or the same wrongful death" (740 ILCS 100/1, 2(a) (West 1996)), to the extent that a tortfeasor pays more than his pro rata share of the common liability (740 ILCS 100/2(b)...