Schoonover v. American Family Ins. Co.

• Decision Date: 30 May 1991
• Docket Number: No. 4-90-0860,4-90-0860
• Citation: 572 N.E.2d 1258,214 Ill.App.3d 33,157 Ill.Dec. 794
• Parties: , 157 Ill.Dec. 794 John SCHOONOVER, Plaintiff-Appellee, v. AMERICAN FAMILY INSURANCE COMPANY, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

Page 1258

572 N.E.2d 1258

214 Ill.App.3d 33, 157 Ill.Dec. 794

John SCHOONOVER, Plaintiff-Appellee, v. AMERICAN FAMILY INSURANCE COMPANY, Defendant-Appellant.

No. 4-90-0860.

Appellate Court of Illinois,

Fourth District.

May 30, 1991.

Rehearing Denied June 28, 1991.

Heyl, Royster, Voelker & Allen, Peoria; Karen L. Kendall, Duncan B. Cooper and David A. Perkins, of counsel, for defendant-appellant.

R. John Alvarez, Grosboll, Becker, Tice, Alvarez & Smith, Petersburg, for plaintiff-appellee.

Justice GREEN delivered the opinion of the court:

On November 16, 1987, plaintiff John Schoonover purchased a homeowner's insurance policy from defendant American Family Insurance Company to insure a house he had purchased in Jacksonville, Illinois. The insured building was destroyed by fire on November 20, 1987. Plaintiff filed a claim for his loss on March 10, 1988, and defendant denied the claim on May 9, 1988.

On April 4, 1989, plaintiff filed a complaint in the circuit court of Morgan County against defendant, seeking to recover $37,000 for the house, which had been insured for $30,000, plus punitive damages, attorney fees, and the cost charged for the demolition of the building. Defendant filed a motion for summary judgment on the basis that the suit was filed beyond the one-year contractual limitations period for filing suit. Defendant alleged in the motion that plaintiff failed to request a copy of the policy and that plaintiff was at all times represented by counsel. Plaintiff contended in response that the defendant should be estopped from raising the policy's contractual limitations provision as a bar to his action, because plaintiff had never received a copy of the insurance policy and that it was irrelevant that he was represented by counsel.

The trial court entered an order on October 5, 1990, denying defendant's motion for summary judgment. The court held:

"Plaintiff's negligence in failing to inquire about policy limitations does not preclude a finding that the Defendant is estopped to assert the limitation defense where its agent [Harry Coop] failed to make reasonable efforts to locate Plaintiff and deliver to him a copy of the policy."

Supreme Court Rule 308(a), at all times pertinent, has stated:

"When the trial court, in making an interlocutory order not otherwise appealable, finds that the order involves a question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, the court shall so state in writing, identifying the question of law involved. Such a statement may be made at the time of the entry of the order or thereafter on the court's own motion or on motion of any party. The Appellate Court may thereupon in its discretion allow an appeal from the order." 134 Ill.2d R. 308(a).

Subsequent to the order denying defendant's motion for summary judgment, the circuit court made the findings required by Supreme Court Rule 308(a) and "identif[ied] the question[s] of law involved" (134 Ill.2d R. 308(a)), in these words:

"(1) Whether there is an implied covenant in a policy of insurance that requires the insurer or its agent to make all reasonable efforts to deliver a copy of the policy of insurance to the insured?

(2) Whether the insurer is estopped from asserting at summary judgment stage the defense of a one year contractual limitation period for filing suit on the policy where the insured did not request or receive a copy of the policy nor inquire about the policy terms with the agent or the insurer, and there is a question of fact whether the agent acted reasonably in failing to provide a copy of the policy to the insured where the insured's residence covered by the policy was destroyed by fire within days after its effective date and the agent was aware of insured's place of employment, prior residences, name and address of his mortgagee, and made no attempt to locate the insured."

Upon defendant's petition, we granted leave to appeal from the order denying defendant's motion for summary judgment. We reverse.

We consider first the scope of the review applicable to the order on appeal. The supreme court has never passed upon the question. In Getto v. City of Chicago (1981), 92 Ill.App.3d 1045, 48 Ill.Dec. 588, 416 N.E.2d 1110, a class action was brought against certain municipalities and cities to recover certain charges which the utilities had collected from their customers for the municipalities pursuant to legislation requiring the utilities to do so. The utilities and cities joined in a motion to dismiss for lack of venue, and the circuit court denied the motion. A Supreme Court Rule 308 appeal was taken, but the question identifying the point of law involved referred only to the proper venue in regard to the municipalities. The First District Appellate Court held that the scope of review was limited by the identifying question, and thus, the question of proper venue as to the utilities was not reached. Concluding that the utilities which could object to the venue had indicated an interest in the appeal only if the utilities were granted leave to appeal, the appellate court dismissed the appeal.

The Getto court reasoned that a Rule 308 appeal should be limited by the identifying question, because the rule applies to appeals from interlocutory orders which are not otherwise appealable. Recognizing that any jurisdiction for an appellate court to entertain the appeal arose from Supreme Court Rule 308, the Getto court decided that the identifying question limited the jurisdiction. The First District Appellate Court rendered a similar decision in Potter v. Chicago Heights Motor Freight, Inc. (1979), 78 Ill.App.3d 676, 33 Ill.Dec. 642, 396 N.E.2d 1366.

In Kondourajian v. Millers National Insurance Co. (1987), 151 Ill.App.3d 870, 104 Ill.Dec. 913, 503 N.E.2d 775, in a suit on an insurance policy, a Rule 308 appeal was taken by an insurer which had been denied a motion for summary judgment based on a lapse of the limitation period set forth in the policy. The identifying question did not control the propriety of the denial of the summary judgment. The Third District Appellate Court pointed out that the suit on the policy was not timely filed. The appellate court did not dismiss the appeal, as was done in Getto; nor did it affirm the order denying summary judgment. Rather, the appellate court vacated the order denying summary judgment and remanded. Judicial efficiency resulted as the circuit court was then in a position to grant the summary judgment to the insurer pursuant to the explanation in the opinion.

The Fifth District Appellate Court was most recently faced with the operation of identifying question aspects of Supreme Court Rule 308 in Koch v. Spalding (1988), 174 Ill.App.3d 692, 124 Ill.Dec. 302, 529 N.E.2d 19. There a flagman at an auto racing event sued the track operator for injuries resulting from a collision during a race. Negligence was charged. The defendant pleaded a written exculpatory release agreement which the plaintiff had signed just prior to assuming his duties. The circuit court denied a defense motion for summary judgment but subsequently supplemented that order with findings pursuant to Supreme Court Rule 308 and the appellate court granted leave to appeal. A long identifying question submitted by the circuit court concerned whether various circumstances surrounding the hasty execution of the release agreement vitiated it.

The entire Koch panel agreed an exculpatory agreement of the nature involved could be entered into validly, and the circumstances of the execution of the agreement involved did not render it invalid. However, the plaintiff also maintained the defendant had given no consideration for the agreement. As that issue was not encompassed in the defining question, a majority of the court held that question could not be considered even though that question was raised by the motion for summary judgment. The cases of Kondourajian and State of Illinois ex rel. Skinner v. Lombard Co. (1982), 106 Ill.App.3d 307, 62 Ill.Dec. 540, 436 N.E.2d 566, were cited for the rule that on a Supreme Court Rule 308 appeal, the appellate court cannot consider matters not set forth by the trial court in the identifying question. Because the identifying question was answered favorably by the court, the majority elected to vacate the order denying the summary judgment and remanded for further proceedings. The further proceedings would, presumably, begin with a further consideration by the circuit court of the question of whether defendant had conclusively shown that adequate consideration was given for the release.

Justice Harrison dissented in Koch. (Koch, 174 Ill.App.3d at 699, 124 Ill.Dec. at 307, 529 N.E.2d at 24 (Harrison, P.J., dissenting).) He agreed the exculpatory release agreement was not inconsistent with public policy, nor was it executed under conditions which made it invalid. He also concluded the record conclusively showed that defendant had given consideration for the agreement. Justice Harrison, therefore, reasoned that the appellate court should reverse and remand with directions to enter summary judgment for defendant. He reasoned that the requirement of Supreme Court Rule 308 for an identifying question was not meant to limit the scope of review, but merely to indicate whether the appeal from the interlocutory order involved a sufficiently important question to warrant such unusual review at such an early stage. He noted that the Fifth District Appellate Court had permitted Rule 308 review in Cooper v. Bi-State Development Agency (1987), 158 Ill.App.3d 19, 22, 110 Ill.Dec. 257, 259, 510 N.E.2d 1288, 1290, when no identifying question had been provided by the circuit court.

Justice Harrison further stated:

"That the trial court's formulation of the relevant legal questions is not controlling becomes evident when one...