Rokeby-Johnson v. Derek Bryant Ins. Brokers, Ltd.

• Decision Date: 18 May 1992
• Docket Number: ROKEBY-JOHNSON,C272,Nos. C271,No. 1-90-2405,s. C271,1-90-2405
• Citation: 230 Ill.App.3d 308,594 N.E.2d 1190,171 Ill.Dec. 670
• Parties: , 171 Ill.Dec. 670 Henry Ralph, individually and on behalf of all those Underwriters at Lloyd's, London, subscribing to Policy, and C283, and Walbrook Insurance Co., Ltd., Plaintiffs-Appellants, v. DEREK BRYANT INSURANCE BROKERS, LTD., Defendant-Appellee.
• Court: United States Appellate Court of Illinois

Page 1190

594 N.E.2d 1190

230 Ill.App.3d 308, 171 Ill.Dec. 670

Henry Ralph ROKEBY-JOHNSON, individually and on behalf of all those Underwriters at Lloyd's, London, subscribing to Policy Nos. C271, C272, and C283, and Walbrook Insurance Co., Ltd., Plaintiffs-Appellants, v. DEREK BRYANT INSURANCE BROKERS, LTD., Defendant-Appellee.

No. 1-90-2405.

Appellate Court of Illinois,

First District, First Division.

May 18, 1992.

Peterson & Ross, Chicago (Thomas S. White, Gregory D. Hopp, Helen Ryan Savaiano and Sarah J. Moore, of counsel), for plaintiffs-appellants.

Wilson, Elser, Moskowitz, Edelman & Dicker, Chicago and New York City (Jerry L. McDowell, Elizabeth M. Budzinski, Thomas Wilson Thomas Hyland and Thomas Leghorn, of counsel), for defendant-appellee.

Justice CAMPBELL delivered the opinion of the court:

Plaintiffs, Henry Ralph Rokeby-Johnson (Rokeby-Johnson), individually and on behalf of all other syndicate insurance underwriters subscribing to policy numbers C271, C272, and C283 and Walbrook Insurance Company (Walbrook), appeal from an order of the trial court granting defendant, Derek Bryant Insurance Brokers Ltd.'s (Bryant Brokers) motion to quash and dismiss plaintiffs' complaint for lack of jurisdiction. Plaintiffs filed a breach of contract action seeking damages for losses incurred in connection with a plan of commercial automobile liability and general liability insurance known as the "SIR" program. On appeal, plaintiffs contend that: (1) the trial court improperly limited plaintiffs' jurisdictional discovery under Illinois Supreme Court Rule 201(1 ); (2) the trial court erred in determining that Bryant Brokers was not "doing business" in Illinois and therefore is not subject to the in personam jurisdiction of the Illinois courts; and (3) jurisdiction over Bryant Brokers is proper under an amendment to the Illinois "long arm statute." (Ill.Rev.Stat.1987, ch. 110, par. 2-209(c).) For the following reasons, we affirm the judgment of the trial court.

The record sets forth the following facts relevant to this appeal. All parties to this appeal are subjects of the United Kingdom. Plaintiffs are insurance underwriters for Lloyd's, London. Bryant Brokers was a reinsurance brokerage company incorporated in the United Kingdom. Plaintiffs filed their amended complaint on June 30, 1988. Therein, plaintiffs claimed that Bryant Brokers' "continuous activities" in Illinois were sufficient to constitute "doing business" in Illinois. Plaintiffs claim that Bryant Brokers, along with Will Darrah & Associates (Darrah), developed the "SIR" program, with the intention that Darrah would issue policies on behalf of the Lloyd's Underwriters, and Bryant Brokers would serve as intermediary between Darrah and plaintiffs. Plaintiffs claim that Bryant Brokers entered into an agreement with plaintiffs to monitor and supervise Darrah, and was paid commissions by virtue of plaintiffs' contracts with Darrah. Plaintiffs allege that Bryant Brokers breached its agreement with plaintiffs by inter alia failing to provide accurate statements or reports to plaintiffs in connection with the "SIR" program.

Bryant Brokers was served with summons and process on September 27, 1988, in London, England. On October 21, 1988, Bryant Brokers filed a special and limited appearance pursuant to section 2-301 of the Illinois Code of Civil Procedure, along with a motion to quash and dismiss plaintiffs' amended complaint for lack of personal jurisdiction. In its motion, Bryant Brokers stated that on August 3, 1988, Bryant Brokers was sold in its entirety to D.G. Durham International, Ltd. ("Durham"), an insurance brokering company incorporated in England. Durham is not a party to this suit.

On August 14, 1989, Bryant Brokers filed an amended motion to quash and dismiss and submitted two affidavits in support thereof. The amended motion attacked plaintiffs' jurisdictional allegations on the grounds that the allegations were insufficient on their face and failed to present evidence that Bryant Brokers was "doing business" in Illinois.

In response to Bryant Brokers' motion, and pursuant to Illinois Supreme Court Rule 201(l ), (134 Ill.2d R. 201(1)), plaintiffs propounded discovery requests upon Bryant Brokers pertaining to the issue of jurisdiction. Bryant Brokers responded to plaintiffs' discovery requests, but objected to any discovery prior to 1987, one year prior to the time they were served with plaintiffs' complaint. Thereafter, plaintiffs filed a motion to compel Bryant Brokers to submit additional information.

At the October 24, 1989, hearing on plaintiffs' motion to compel jurisdictional discovery, the trial court found discoverable all information regarding Bryant Brokers' business contacts in Illinois in 1987-1988, the one-year period prior to the date of service of summons. The trial court found that all other information was irrelevant to the jurisdictional issue. In addition, the trial court ruled that plaintiffs were entitled to information predating the one-year period, insofar as it related to any contracts which were entered into by Bryant Brokers that yielded financial benefits within the one-year period. The trial court stated that plaintiffs were not entitled to information relating to transactions that terminated more than a year before the service of process where such transactions were totally completed and there was no longer a contractual relationship existing between Bryant Brokers and some other entity.

Thereafter, plaintiffs issued revised discovery requests and Bryant Brokers responded. Plaintiffs again brought a motion to compel, relying upon jurisdictional discovery obtained in another case pending against Bryant Brokers. ¹ In a hearing on March 16, 1990, the trial court reiterated its limitation on discovery to information relevant to jurisdiction, as defined in the October 24 hearing, and held that plaintiffs could take the depositions of Bryant Brokers' affiants and other relevant witnesses. Plaintiffs did not depose Bryant Brokers' affiants.

On July 19, 1990, the trial court held a hearing on Bryant Brokers' motion to quash and dismiss plaintiffs' complaint. The trial court considered the allegations in plaintiffs' amended complaint, a segment of a deposition transcript of a former director of Bryant Brokers and the two affidavits presented by Bryant Brokers.

In their amended complaint, plaintiffs allege that Bryant Brokers engaged in the following activities: (1) acted as an intermediary in a program of commercial automobile liability insurance written by the Forum Insurance Company of Schaumburg, Illinois; (2) arranged certain binding authorities for Illinois-domiciled brokerage firms; (3) maintained a wholly-owned subsidiary in Illinois; and (4) made repeated solicitations and visits of its officers and directors to Illinois. The trial court found that plaintiffs' complaint failed to specify the time period in which these activities occurred, and failed to supply the court with competent evidence suggesting that Bryant Brokers did business through its subsidiary, Bryant Treaty Brokers, Inc.

Plaintiffs also presented to the trial court a portion of the deposition testimony of David Richings, a former director of Bryant Brokers. Regarding a visit in 1984, Richings was asked if he recalled "discussing any items of business on the visit." He responded:

"... [w]ell, I don't recall anything specifically, but we would have talked about the insurance business generally and how we could increase our business as we placed it on the London market on their behalf, so it would have been general discussions, but I can't remember anything specific."

The trial court found Riching's testimony indeterminate on the issue of jurisdiction.

Plaintiffs also presented the following documents to the trial court attached to their memorandum in opposition to Bryant Brokers' motion: (1) an undated brochure of the business operations of Bryant Brokers; (2) a list of twenty-nine alleged visits by Bryant Brokers' officers and directors to Illinois between 1982 and 1988; (3) a chart of Bryant Brokers' gross income and its commissions from contracts arranged on behalf of Illinois companies; (4) an incomplete, unsigned letter to the shareholders of Derek Bryant Group, p.l.c., a separate corporate entity; and (5) a segment of the minutes of a Bryant Brokers board meeting held on November 6, 1984, wherein a discussion was had regarding setting up an office in Chicago. In their memorandum, plaintiffs contend that Bryant Brokers' 29 business trips to Illinois between 1982 and 1988 were "highly successful," and that during the same period, Bryant Brokers "extracted" almost $6 million in commissions. The trial court found the above evidence incompetent and without foundation.

In support of its motion to quash, Bryant Brokers presented the affidavits of Stuart Bryant, a former director of Bryant Brokers, and James Scott-Wakeling, an employee in the claims department. Bryant stated that at one time, Bryant Brokers served as brokers to the reinsurance community in London and in other places. On August 3, 1988, the ongoing business and associated assets of Bryant Brokers were sold to Durham, a Lloyd's insurance brokering company incorporated in England. As of that date, Bryant Brokers had no employees, however, pursuant to English law, Bryant Brokers remained on the English Companies' Registrar with certain directors acting in an administrative capacity.

Bryant further stated in his affidavit that Bryant Brokers had been incorporated in and conducted its business in London, and was never licensed nor authorized to do business in the State of Illinois. Bryant Brokers never had an office, real property or personal property, post office box number, telephone number, nor bank account within the State of Illinois. Further, Bryant Brokers never advertised in Illinois and had no employees nor actual or designated agents within Illinois.

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