O'Neal-Vidales v. Clark

• Decision Date: 29 September 2015
• Docket Number: No. 2–14–1248.,2–14–1248.
• Citation: 40 N.E.3d 804
• Parties: Addie M. O'NEAL–VIDALES, Plaintiff and Counterdefendant–Appellant, v. Richard L. CLARK, Defendant (Affirmative Insurance Company, Defendant and Counterplaintiff–Appellee, and Founders Insurance Company, Defendant and Counter-plaintiff).
• Court: United States Appellate Court of Illinois

40 N.E.3d 804

Addie M. O'NEAL–VIDALES, Plaintiff and Counterdefendant–Appellant

v.Richard L. CLARK, Defendant (Affirmative Insurance Company, Defendant and Counterplaintiff–Appellee, and Founders Insurance Company, Defendant and Counter-plaintiff).

No. 2–14–1248.

Appellate Court of Illinois, Second District.

Sept. 29, 2015.

William T. Cacciatore and Eileen J. McCabe, both of Cacciatore Law Offices, Rockford, for appellant.

Brian M. Nach, of Law Office of Brian M. Nach, Chicago, for appellee.

OPINION

Justice HUTCHINSON

delivered the judgment of the court, with opinion.

¶ 1 Plaintiff, Addie M. O'Neal–Vidales, and defendant Richard L. Clark were involved in a motor vehicle collision in Rockford on September 18, 2009. On May 4, 2011, plaintiff filed a complaint against Clark for personal injuries that she sustained. Plaintiff filed an amended complaint on August 15, 2012, seeking declaratory judgments that defendants Affirmative Insurance Company (Affirmative) and Founders Insurance Company (Founders) were required to provide policy benefits as a result of the accident. Affirmative and Founders filed counterclaims seeking declaratory judgments that they had no duty to provide benefits. The parties later filed cross-motions for summary judgment and proceeded to a hearing.

¶ 2 On May 16, 2014, the trial court declared that Founders had no duty to provide benefits to plaintiff, and it therefore granted summary judgment in favor of Founders. The trial court denied all other requests. Plaintiff appealed the ruling in favor of Founders, and we affirmed. See O'Neal–Vidales v. Clark, 2014 IL App (2d) 140549–U, 2014 WL 7367153

. Founders is not a party to this appeal.

¶ 3 Plaintiff and Affirmative subsequently filed their second cross-motions for summary judgment. Following a hearing, the trial court granted summary judgment in favor of Affirmative. Plaintiff timely appealed. We reverse and remand with directions.

¶ 4 I. BACKGROUND

¶ 5 On September 18, 2009, plaintiff was an employee of the United States Postal Service and she was driving a postal truck during the normal course of her duties. Clark was driving a recently purchased 1991 Chevrolet. Clark had an automobile insurance policy with Affirmative that covered a different vehicle: his 1992 Ford. Clark purchased the Affirmative policy on the Ford through InsureOne Independent Insurance Agency, LLC (InsureOne). Following the accident, plaintiff filed a claim with Affirmative for her personal injuries. Affirmative denied the claim on the basis that Clark's Chevrolet did not meet the definition of an “insured auto” under the policy.

¶ 6 Under the policy, an “owned auto” was an “insured auto.” The provision defining an “owned auto” stated as follows:

“Owned auto means:

(a) a motor vehicle owned by you and identified on the Declarations of this policy; and

(b) a newly acquired motor vehicle of which you you [sic ] obtain ownership during the policy period and regarding which we are notified in writing, no later than 30 days after acquisition, of your election to make this and no other insurance policy applicable, and;

(1) the newly acquired motor vehicle replaces another owned auto and neither you nor any resident of your household retains ownership of the replaced owned auto; or

(2) the newly acquired motor vehicle does not replace another owned auto and we insure all motor vehicles owned by you on the date of such acquisition.”

¶ 7 In addition, a separate section of the policy contained the following condition:

“3. Coverage of Newly Acquired Vehicles (a) If any owned auto is replaced by another owned auto or if an additional owned auto is acquired, coverage applies to that newly acquired motor vehicle only upon and at the time of receipt of written request to add such motor vehicle to the policy. However, if such request is received no later than 30 days after the date of such motor vehicle's acquisition, and specifies your election to make this and no other insurance policy applicable to such newly acquired motor vehicle, coverage applies to that motor vehicle from the date of its acquisition * * *.”

¶ 8 The record reflects that Clark was imprisoned on unrelated criminal charges shortly after the accident. His deposition was taken while he was in custody in Ohio, on June 30, 2014.

¶ 9 Clark testified that he purchased used vehicles on numerous occasions and exclusively used InsureOne to procure his insurance. Every time he purchased a used vehicle, he called InsureOne and informed a representative that he needed to add or transfer coverage. He typically carried only liability insurance, because his vehicles were inexpensive; his sole concern was that he was legally insured. Accordingly, InsureOne would provide him with the least expensive policy available. Either Clark would pick up his policies and insurance cards at InsureOne's Rockford office or the documents would arrive in the mail. He could not recall having policies issued from any insurance company other than Affirmative.

¶ 10 Clark purchased the Chevrolet from a private owner. He paid $500 cash and the seller provided a signed title. Clark recalled that the transaction occurred either one or two days before the accident with plaintiff. At some point before the accident, he called InsureOne and informed a representative that he had acquired the Chevrolet, which was meant to be an additional vehicle and was not meant to replace the Ford. Clark told the representative that he wanted the Chevrolet added to his policy on the Ford. He remembered giving the representative the Chevrolet's description and vehicle identification number. He also remembered being told, “We got you. It's insured. Just go get your plates.” Clark later reiterated that the representative had told him, “You're fine. We got it. We got everything. It's taken care of. We'll send you the paperwork.”

¶ 11 Clark was asked if he ever called Affirmative regarding insurance on the Chevrolet. He answered that he had called the number on the insurance card that he had been given when he insured the Ford. Clark was then asked if he regarded InsureOne as his insurance agency, to which he responded, “[y]eah, that's—you just call the InsureOne and they take care of it,” adding, “it's got to be an agency of some kind.” When asked if he remembered making a written request to Affirmative for insurance on the Chevrolet, Clark responded, “[n]o, I would just call InsureOne.”

¶ 12 On the day of the accident, Clark was on his way to register the Chevrolet and obtain license plates. Following the accident, he sold the Chevrolet to a junkyard. Clark never filed a claim, because he knew that he had only liability insurance, the vehicle was a total loss, and he figured that he would not receive any compensation. He remembered that Affirmative attempted to contact him regarding the Chevrolet at some point after the accident, but he was more concerned with the unrelated criminal charges by that time, and he “didn't really care” about following up with Affirmative.

¶ 13 Plaintiff and Affirmative filed their second cross-motions for summary judgment following Clark's deposition. Plaintiff argued that Affirmative's policy covered Clark's Chevrolet under two theories. Plaintiff first argued that Clark did not yet own the Chevrolet at the time of the accident, because it was never registered (in which case the policy would have covered the Chevrolet under a different provision). Plaintiff also argued that, if Clark did own the Chevrolet, it qualified for coverage under the policy as a “newly acquired vehicle.” Plaintiff acknowledged that Clark never made a written request for coverage, but she asserted that Clark's discussion with the representative from InsureOne justified a finding of coverage. Affirmative argued in its motion that Clark owned the Chevrolet but that it did not qualify for coverage as a “newly acquired vehicle,” because Clark “never wrote to or even called Affirmative” to request that it be added to his policy on the Ford. Affirmative asserted that InsureOne was a “separate entity” and was merely the “retail agency from whom [Clark] purchased the insurance policy.”

¶ 14 Following a hearing on December 5, 2014, the trial court granted summary judgment in favor of Affirmative. The trial court found that Clark owned the Chevrolet at the time of the accident; Affirmative's policy contained a valid and enforceable requirement that Clark provide written notice within 30 days of the Chevrolet's acquisition to qualify for coverage; Clark failed to provide such written notice; and Clark was not entitled to any indemnity or defense from Affirmative. Plaintiff filed a timely notice of appeal.

¶ 15 Thereafter, the trial court entered a default judgment against Clark on the issue of liability, awarding plaintiff $59,307.30 in medical expenses, lost wages, pain and suffering, and loss of a normal life, plus court costs.

¶ 16 II. ANALYSIS

¶ 17 Plaintiff contends that the trial erred in granting summary judgment in favor of Affirmative, because under Affirmative's policy Clark's Chevrolet was automatically covered for 30 days from the date of the car's acquisition, regardless of whether Clark complied with the policy's written notice requirement. In support, plaintiff relies primarily on American Freedom Insurance Co. v. Smith, 347 Ill.App.3d 1, 282 Ill.Dec. 548, 806 N.E.2d 1136 (2004)

, from the First District. Affirmative counters that plaintiff has forfeited her right to rely on American Freedom, by failing to raise the case in the trial court. In the alternative, Affirmative urges us to disregard the First District's holding in American Freedom and instead follow our own holding in Hall v. Country Casualty Insurance Co., 204 Ill.App.3d 765, 150 Ill.Dec. 110, 562 N.E.2d 640 (1990).

¶ 18 The record reflects that plaintiff failed to discuss American Freedom in the trial court. However, plaintiff clearly raised the issue of whether Clark's Chevrolet was covered by Affirmative's policy. See In re...