Nickon v. City of Princeton

• Decision Date: 24 October 2007
• Docket Number: No. 3-06-0952.,3-06-0952.
• Citation: 877 N.E.2d 776
• Parties: Nick NICKON, Plaintiff-Appellee, v. CITY OF PRINCETON, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

877 N.E.2d 776

Nick NICKON, Plaintiff-Appellee, v. CITY OF PRINCETON, Defendant-Appellant.

No. 3-06-0952.

Appellate Court of Illinois, Third District.

October 24, 2007.

John P. Fleming (argued), Nicholas E. Owens, Fleming & Umland, Peoria, for City of Princeton.

Paul Perona (argued), Perona, Peterlin, Andreoni & Brolley, LLC, Peru, for Nick Nickon.

Justice WRIGHT delivered the opinion of the court:

Plaintiff Nick Nickon filed a negligence action against defendant City of Princeton for injuries he sustained when he tripped and fell on a sidewalk. A jury rendered a verdict for plaintiff. Defendant timely appealed. We affirm.

BACKGROUND

On August 6, 2003, Nick Nickon sustained injuries after falling on a sidewalk located on Main Street in Princeton. This sidewalk was located on a State of Illinois right-of-way for Illinois Route 26 which is known as Main Street within the city limits of Princeton.

When defendant made improvements to the roadway on Main Street in downtown Princeton, defendant and the State negotiated to share the costs. The Illinois Department of Transportation (IDOT) agreed to maintain the traffic lanes after completion of the project and the city agreed to maintain the sidewalks. In accordance with that agreement, over the course of the last decade prior to the accident in this case, defendant made repairs to the Main Street sidewalk.

Before trial, the trial court allowed defendant's motion in limine to prohibit testimony regarding previous injuries sustained by another person at the same location on Main Street. During trial, Georgianne Johnson testified that one year before plaintiff's fall she stepped into the same depression and fell. However, Johnson also testified that she sustained injuries as a result of her accident in August 2002. Defendant objected to this portion of her testimony. The court sustained defendant's motion to strike the testimony for being in violation of the pretrial order granting defendant's motion in limine. The court instructed the jury to disregard that portion of the answer. The court also allowed Johnson to explain to the jury that her injuries were minor and did not require medical attention.

During trial, plaintiff introduced evidence of medical bills for his injuries totaling $119,723.11. Defendant attempted to produce evidence that the medical care providers discounted the charges after receiving the Medicare payment. However, the court prohibited defendant from introducing any evidence to the jury that demonstrated Medicare paid a reduced amount, $34,888.61 in total, as payment in full for the medical bills. The trial court employed the collateral source rule and did not permit the jury to hear evidence of the significant reduction of charges.

The jury rendered a verdict in favor of plaintiff and against defendant in the amount of $170,800, which included initially billed medical charges of $119,000.00. Following the jury verdict, defendant filed a two-part posttrial motion. The trial court denied defendant's posttrial requests for judgment notwithstanding the verdict on the issue of an open and obvious defect on the sidewalk. The court also denied defendant's posttrial request for set-off or reduction of the verdict to reflect the amount actually paid by Medicare. Defendant appealed.

We will recount additional facts as relevant to our analysis.

ANALYSIS

Defendant raises five issues on appeal. First, defendant contends the trial court erred in entering summary judgment on the issue of "control" of the sidewalk where plaintiff was injured. Second, defendant asserts that plaintiff's violation of the trial court's order in limine precluding evidence of a prior injury to another person on the same sidewalk requires reversal. Third, defendant argues that the trial court erred by denying defendant's tendered jury instruction concerning immunity. Fourth, defendant submits that the trial court erroneously denied a posttrial motion to set-off or reduce the jury award and an alternative request for judgment in favor of defendant notwithstanding the verdict. Finally, defendant contends that the jury should have been allowed to consider the actual amount Medicare paid for plaintiff's medical bills. We will address the collateral source issues first and foremost.

Defendant raises two issues regarding the Medicare payment in this case. First, defendant argues the jury should have been allowed to consider evidence that the health care provider accepted a Medicare payment in the amount of $34,888.61 as payment in full for charges originally billed at $119,723.11. Plaintiff asserts the trial court correctly applied the collateral source rule by prohibiting the introduction of this evidence. Defendant contends the Medicare payment does not qualify as a collateral source under Illinois law.

Next, in a related issue, defendant claims the trial court erroneously denied its posttrial motion for set-off or reduction of the jury's award. Defendant claims the jury award for medical expenses should be reduced to the amount actually paid by Medicare, $34,888.61. Alternatively, defendant asserts the amount Medicare paid, $34,888.61, should be further adjusted downward by the 30% measure of comparative fault the jury attributed to plaintiff.

Regarding both issues, defendant relies heavily on the dissent in Arthur v. Catour, 216 Ill.2d 72, 295 Ill.Dec. 641, 833 N.E.2d 847 (2005). For purposes of our analysis, it is important to understand the issue in Arthur came before the reviewing courts on a certified question raised before the jury trial began. This certified question was whether "plaintiff will be limited to seeking compensatory damages not exceeding those actually paid to her medical providers." Arthur, 216 Ill.2d at 76, 295 Ill.Dec. 641, 833 N.E.2d 847.

To answer that question in the context of the case on review in Arthur, the supreme court had to determine whether the collateral source rule extends to the entire amount initially charged for medical services, even when those services are later discounted by the provider when paid by a third party. Significant to the court's analysis in Arthur was the amount the medical provider "expected" as payment when initially billing for the services, not the amount the medical provider "accepted" from a third party as payment in full. So considered, the court's unequivocal answer to the certified question was, "Plaintiff may present to the jury the amount that her health-care providers initially billed for services rendered." Arthur, 216 Ill.2d at 83, 295 Ill.Dec. 641, 833 N.E.2d 847. This answer was consistent with well established precedent.

With a great degree of foresight and long before Arthur, our supreme court carved a single exception to the collateral source rule. First recognized in this District nearly one hundred years ago, this exception dictates collateral sources should not include services provided by charitable providers without charge, i.e., without generating an initial bill. Peterson v. Lou Bachrodt Chevrolet Co., 76 Ill.2d 353, 363, 29 Ill.Dec. 444, 392 N.E.2d 1 (1979) (citing Adams Co. v. George, 227 Ill. 64, 69, 81 N.E. 4 (1907)).

In Peterson, the medical provider was the philanthropical Shriner hospital, renowned for generously providing medical care for children free of charge to the family. Defendant seeks to expand Peterson beyond gratuitous medical care to the situation presented in the case at bar. The exception developed by the court in Peterson, does not apply in our case since the medical provider clearly billed for the services in expectation of payment, unlike the Shriner hospital in Peterson. We refrain from applying the decision in Arthur to expand the reach of Peterson to services initially billed but subsequently discounted for a third party payor.

Our decision today relies heavily on the blueprint provided by our supreme court in a line of cases discussing the collateral source rule. The court has stated the collateral source rule does not allow a wrongdoer to take advantage of "contracts or other relations that may exist between the injured party and third persons." (Emphasis added.) Wilson v. Hoffman Group, Inc., 131 Ill.2d 308, 320, 137 Ill. Dec. 579, 546 N.E.2d 524 (1989). Clearly, the Wilson court foresaw the possibility that relationships "other than" those arising from a contract of insurance may constitute collateral sources for payment. Thus, the rule of Wilson is not limited only to contractual payments. The injured party in this case had a relationship "other than" a contract with the collateral source. Here, plaintiff's relationship with Medicare arose because of his previous employment, his past contributions, and his current age.

Relying on the dissent in Arthur, defendant seeks to cast Medicare into a separate category which would not be protected by the collateral source rule. In her dissent, Chief Justice McMorrow characterized the majority's answer to the collateral source issue in Arthur as "no answer at all." Arthur, 216 Ill.2d at 87, 295 Ill. Dec. 641, 833 N.E.2d 847 (McMorrow, C.J., dissenting). However, based on our reading of Arthur, the majority provided a concise answer to the specific evidentiary question as posed without equivocation or conditional parameters. "Initially billed" is not difficult to understand when considering evidence to be submitted to the jury. "Initially billed" has no bearing on "ultimately paid."

By focusing on the amount initially billed, the Arthur court's decision recognizes a practical reality. That is, if a government agency or insurance company does not pay the patient's bill at the reduced rate offered to the third party payor, liability for the amount initially billed falls squarely on the patient's financial shoulders. This liability is not relieved until payment is received from any source, thereby triggering the collateral source rule.

The supreme court's answer to the evidentiary question in Arthur preempts the...