Rosenberg v. Zurich American Ins. Co.

• Decision Date: 08 February 2000
• Docket Number: No. 1-99-1015.,1-99-1015.
• Citation: 244 Ill.Dec. 433,312 Ill. App.3d 97,726 N.E.2d 29
• Parties: Christina ROSENBERG, as Special Administrator of the Estate of Pasquale Santaniello, Deceased, Plaintiff-Appellant, v. ZURICH AMERICAN INSURANCE COMPANY, Defendant-Appellee.
• Court: United States Appellate Court of Illinois

726 N.E.2d 29

312 Ill. App.3d 97

244 Ill.Dec. 433

Christina ROSENBERG, as Special Administrator of the Estate of Pasquale Santaniello, Deceased, Plaintiff-Appellant, v. ZURICH AMERICAN INSURANCE COMPANY, Defendant-Appellee.

No. 1-99-1015.

Appellate Court of Illinois, First District, Second Division.

February 8, 2000.

Anesi, Ozmon, Rodin, Novak & Kohen, Ltd., Chicago (Bruce M. Kohen, Scott H. Rudin, of counsel), for Appellants.

Robert Marc Chemers, Patrick G. Cooke, Pretzel & Stouffer, Chartered, Chicago (Robert Marc Chemers, Daniel G. Wills, of counsel), for Appellees.

Justice GORDON delivered the opinion of the court:

In October 1996, Pasquale Santaniello, while a pedestrian, was struck by an automobile driven by an uninsured motorist and died subsequently from his injuries. At the time of the accident, Santaniello resided at the Hillcrest Retirement Village (Hillcrest) and Hillcrest maintained an automobile insurance policy with defendant Zurich American Insurance Company that included uninsured motorist coverage of up to $1 million per accident. In August 1997, plaintiff Christina Rosenberg, as special administrator of Santaniello's estate, filed a negligence and wrongful death complaint against the driver of the vehicle. In August 1998, plaintiff filed an amended complaint for declaratory judgment against defendant seeking $1 million in compensation for Santaniello's injuries and death under the uninsured motorist policy defendant maintained with Hillcrest.

In September 1998, upon defendant's motion, the trial court dismissed plaintiff's complaint with leave to amend. In November 1998, plaintiff filed her second amended complaint for declaratory judgment seeking the same relief. In February 1999, the trial court granted defendant's motion to dismiss plaintiff's complaint with prejudice for failure to state a cause of action on the basis that Santaniello was not covered by Hillcrest's uninsured motorist policy with defendant. 735 ILCS 5/2-615 (West 1998). Plaintiff now appeals. We affirm.

BACKGROUND

On October 22, 1996, Santaniello was a pedestrian crossing a roadway in Lake County when an automobile driven by Robert E. Pauley struck him. Three weeks later, Santaniello died. In her complaint against Pauley, plaintiff alleged that Pauley had negligently failed to avoid hitting Santaniello and had wrongfully caused Santaniello's death. Pauley did not have automobile insurance at the time of the accident.

At the time of the automobile accident, Hillcrest maintained a business automobile insurance policy as a corporation with defendant. The policy provided for automobile liability insurance, including uninsured motorist coverage, for the policy period of November 30, 1995, to November 30, 1996, with a limit of $1 million per accident. The policy and attached endorsement provided for uninsured motorist coverage as follows:

"We will pay all sums the `insured' is legally entitled to recover as compensatory damages from the owner or driver of an `uninsured motor vehicle.' The damages must result from `bodily injury' sustained by the `insured' caused by an `accident'. The owner's or driver's liability for these damages must result from the ownership, maintenance[,] or use of the `uninsured motor vehicle'."

The policy endorsement defined an "insured" for the purposes of uninsured motorist coverage, in pertinent part, as follows:

"1. You.

2. If you are an individual, any `family member.'"

The endorsement further defined a "family member" as "a person related to you by blood, marriage[,] or adoption who is a resident of your household, including a ward or foster child." The policy declarations identified only Hillcrest, a corporation, as the named insured. Only one vehicle, a Dodge Maxi-Wagon, was listed on the policy's schedule of covered automobiles.

According to her amended complaint for declaratory judgment against defendant, plaintiff made a $1 million claim against the uninsured motorist policy Hillcrest maintained with defendant to compensate Santaniello's estate for his medical costs, suffering, and ultimate death. Defendant denied the claim, stating Santaniello could not receive benefits unless his injuries resulted from a collision involving the particular automobile covered by its policy with Hillcrest. Plaintiff alleged in her complaint that Pauley was an uninsured motorist within the meaning of the insurance policy and that the policy could also apply to a Hillcrest resident struck as a pedestrian by an uninsured motorist.

In her second complaint, plaintiff further alleged that, among other things, (1) Santaniello was a resident "family" member of Hillcrest pursuant to the Nursing Home Care Act (210 ILCS 45/1-122 (West 1996)); (2) Hillcrest provided Santaniello with boarding and all personal services; (3) Santaniello had listed Hillcrest as his place of residence on his voter's registration; (4) Santaniello had his public aid and social security checks sent directly to Hillcrest and drew only a small monthly allowance from Hillcrest; and (5) Santaniello relied upon the transportation Hillcrest provided with the insured vehicle to travel to appointments, entertainment, and other places outside the retirement village. Defendant moved to dismiss plaintiff's second amended complaint on the basis that Hillcrest was a corporation and, therefore, by law could not have family members, preventing the extension of coverage to any such "family members", or, in this case, individuals residing at Hillcrest.

In dismissing the complaint with prejudice, the trial court stated that to find in favor of plaintiff would "unquestionably be rewriting the insurance contract between the insured and the insurer". The trial court also found that to accept plaintiff's construction of the policy would mean there would be "no end" to the extension of similar policies. This appeal followed.

ANALYSIS

In reviewing a trial court's granting a defendant's motion to dismiss a complaint, this court must regard the plaintiff's well-pleaded facts and their reasonable inferences as true. Illinois Central Gulf R.R. v. Continental Casualty Co., 132 Ill.App.3d 310, 312, 87 Ill.Dec. 274, 476 N.E.2d 1266, 1268 (1985). The construction of an insurance policy is a question of law subject to de novo review. American States Insurance Co. v. Koloms, 177 Ill.2d 473, 479-80, 227 Ill.Dec. 149, 687 N.E.2d 72, 75 (1997); Whiting v. Prestige Casualty Co., 238 Ill.App.3d 376, 377, 179 Ill.Dec. 565, 606 N.E.2d 397, 398 (1992).

On appeal, plaintiff argues that (1) the policy Hillcrest had with defendant was ambiguous and should be interpreted to cover Santaniello as a Hillcrest "family member" in light of the "unique" living arrangement Santaniello had at Hillcrest; (2) Santaniello was a "ward" of Hillcrest and, therefore, a "family member" as described by the policy; and (3) public policy favors providing coverage to Santaniello in this case. Defendant counters that (1) Hillcrest was covered under the policy as a corporation and corporations cannot have family members as a matter of Illinois law; (2) the policy issued to Hillcrest was unambiguous and cannot be construed to cover Hillcrest residents; and (3) Santaniello would not qualify as a "family member" of Hillcrest, even if the insurance policy could be construed to extend to Hillcrest "family members".

A court's primary objective in construing the language of an insurance policy is to ascertain and give effect to the intentions of the parties as expressed in their agreement. American States, 177 Ill.2d at 479,227 Ill.Dec. 149, 687 N.E.2d at 75; Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill.2d 90, 108, 180 Ill.Dec. 691, 607 N.E.2d 1204, 1212 (1992). To ascertain the meaning of the policy's words and the intent of the parties, the court must construe the policy as a whole with due regard to the risk undertaken, the subject matter that is insured, and the purpose of the entire contract. American States, 177 Ill.2d at 479,227 Ill.Dec. 149,687 N.E.2d at 75; Outboard Marine, 154 Ill.2d at 108,180 Ill.Dec. 691,607 N.E.2d at 1212. If the terms of the policy are clear and unambiguous, they must be given their "plain, ordinary, and popular meaning." American States, 177 Ill.2d at 479,227 Ill.Dec. 149,687 N.E.2d at 75; Outboard Marine, 154 Ill.2d at 108,180 Ill.Dec. 691,607 N.E.2d at 1212. Conversely, if the terms of the policy are susceptible to more than one meaning, they are to be considered ambiguous and will be construed strictly against the insurer who drafted the policy. American States, 177 Ill.2d at 479,227 Ill.Dec. 149,687 N.E.2d at 75; Outboard Marine, 154 Ill.2d at 108-09,180 Ill.Dec. 691,607 N.E.2d at 1212.

On its face, the policy issued to Hillcrest by defendant is unambiguous in not including Santaniello as an insured. First, in describing who is an "insured", the policy states that it extends to "family members" only if the insured is an "individual". The policy declarations specifically describe Hillcrest as a "corporation" and not as an "individual". This appears to preclude plaintiff from even arguing that Santaniello qualifies as a "family member" covered by Hillcrest's policy. The fact that the policy mentions "family members" does not in itself render the policy ambiguous because the record shows that the policy forms are specifically designed so the "named insured" can be either an "individual", a "partnership", or a "corporation", and the policy language states that "family members" are covered only when the named insured is designated as an "individual".

Moreover, as defendant notes, Illinois law has specifically stated that corporations cannot have family members. See Economy Preferred Insurance Co. v. Jersey County Construction, Inc., 246 Ill.App.3d 387, 392, 186 Ill.Dec. 233, 615 N.E.2d 1290, 1293-94 (1993), citing Polzin v. Phoenix of Hartford Insurance Cos., 5 Ill.App.3d 84, 283 N.E.2d 324 (1972) (corporations cannot and do not have family...