Williams v. Country Mut. Ins. Co.
| Decision Date | 24 December 2015 |
| Docket Number | No. 1-14-2534,1-14-2534 |
| Citation | 2014 IL App (1st) 142534 -U |
| Parties | CLIFFORD WILLIAMS, Plaintiff-Appellant/Cross-Appellee, v. COUNTRY MUTUAL INSURANCE COMPANY, Defendant-Appellee/Cross-Appellant. |
| Court | United States Appellate Court of Illinois |
NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1).
Appeal from the Circuit Court of Cook County.
¶ 1 Held: Trial court did not err in finding that plaintiff did not properly plead consequential damages where plaintiff failed to plead that the parties contemplated at the time the contract was formed that lost rental income above the policy limit, mold, and loss of use could result; trial court was within its discretion when it did not award statutory damages and reduced plaintiff's attorneys' fees pursuant to section 155 of the Illinois Insurance Code (215 ILCS 5/155 (West 2012)); Plaintiff forfeited prejudgment interest claim; trial court properly dismissed the common law fraud and consumer fraud counts where plaintiff failed to sufficiently plead conduct other than breach of contract and vexatious and unreasonable delay as a basis for those claims; court did not abuse its discretion when it refused defendant's proposed jury instruction and motion in limine requesting actual cash value as the measure of damages; the jury's verdict finding theft was not against the manifest weight of the evidence where substantial evidence was presented to the jury regarding the alleged theft and vandalism; and the trial court did not abuse its discretion in finding that there was no bona fide dispute over coverage where defendant classified damage as resulting from vandalism rather than theft where the determination was not based on adequate evidence, but rather was motivated by defendant's desire for an exclusion to apply.
¶ 2 This appeal arises from defendant, Country Mutual Insurance Company, denying a claim made by plaintiff, Clifford Williams, for payment under a home insurance policy. Plaintiff submitted the claim for losses that occurred when his two-flat, located at 2745 West Warren, Chicago, Illinois, was invaded twice. During the break-ins, walls and fixtures were cut open and metal pipes and appliances were removed. Defendant denied the claim, finding that an exclusion under the policy applied. Plaintiff brought suit against defendant in the circuit court of Cook County for breach of contract, damages under section 155 of the Illinois Insurance Code (Code)(215 ILCS 5/155 (West 2012)), common law fraud, and consumer fraud. The trial court dismissed both the common law fraud and consumer fraud claims pursuant to section 2-615 of the Illinois Code of Civil Procedure, deciding that they were improperly pleaded and preempted by section 155. 735 ILCS 5/2-615 (West 2012).
¶ 3 Plaintiff appeals from the jury trial verdict and judgment in her favor. Finding a breach of the insurance contract, the jury awarded plaintiff $40,000 for the replacement cost of the damage to the dwelling and $14,000 for loss of rental value, for a total of $54,000. Subsequently, the trial court found that defendant's delay in paying plaintiff's claim was vexatious and unreasonable and awarded plaintiff's attorneys $63,185 in fees pursuant to section 155. Plaintiff filed a post-trial motion for additur, Judgment N.O.V., or for a new trial on damages, which was denied. Subsequently, defendant filed a post-trial motion requesting remittitur or a new trial, arguing that the jury verdict was against the manifest weight of the evidence. The court also denied that motion. Plaintiff raises four issues on appeal: 1) the trial court erred in not allowing consequential damages; 2) the court failed to award reasonableattorneys' fees and other statutory damages; 3) the court should have awarded prejudgment interest; and 4) the court improperly dismissed the common law fraud and consumer fraud claims. Defendant cross-appeals, arguing that: 1) the court erred when it refused its jury instruction and its motion in limine, which set to restrict damages to the actual cash value; 2) the jury's verdict finding the damage was a result of theft was against the manifest weight of the evidence; and 3) the trial court erred when it found that there was no bona fide dispute over coverage. Finding no error in any of these rulings, we affirm the judgments of the trial court.
¶ 5 Prior to trial, the court conducted extensive proceedings regarding the jury instructions proposed by both parties. During those proceedings, plaintiff submitted a proposed jury instruction that would direct the jury to award plaintiff damages not only for damage to the property, theft, and lost rental income that was covered under the policy, but also for consequential damages that were not included in the insurance contract. These consequential damages included mold, loss of use, and loss of rental income above the policy limit. Defendant objected to this instruction on the basis that the insurance contract prevented recovery for damages that are not covered by the contract. In support of this argument, defendant cited Heller International Corporation v. Sharp, 839 F. Supp. 1297 (1993), and Clark v. Standard Life & Accident Insurance Co., 68 Ill. App. 3d 977 (1979), which hold that, generally, in breach of insurance contract cases the amount of damages is limited to the policy amount.
¶ 6 The court agreed that usually damages are limited to the policy amount, but that both Heller and Clark also hold that "consequential damages may be recovered when they [are]*** reasonably foreseeable and were within the contemplation of the parties at the time the contract was executed, arising out of special circumstances communicated and known to the parties." The court noted that Clark is factually similar to this case and was ultimately decided based on the plaintiff's failure to correctly plead consequential damages.
¶ 7 The trial court then reviewed plaintiff's second amended complaint, and determined that plaintiff did not properly plead consequential damages. Consequently, the jury instruction was denied. The court reasoned:
¶ 8 Subsequently, the court also denied defendant's motion in limine number four, which requested actual cash value as the measure of damages, and defendant's jury instruction number nine, which instructed the jury on actual cash value. The language of the contract states:
The court decided that the correct measure of damages would be the replacement cost because, under the clear language of the contract, the parties had contracted for replacement cost. The court explained that the provision (paragraph c) imposing a requirement that the repair or replacement be made first, before defendant would pay replacement cost, was not triggered in this case.
¶ 9 At trial, plaintiff testified that he purchased home insurance from defendant in 2009, entering into an insurance contract under which defendant agreed to cover plaintiff's losses related to the building, subject to the terms and exclusions of the contract. When plaintiff was out of town, intruders entered the first floor apartment, cut through walls, removed copper pipes, dismantled the sink, and caused damage to the ductwork and other fixtures. When plaintiff returned to the property on June 21, 2010, he discovered the damage. He made a police report that night and two days later he notified defendant of the break-in and the damage to the property.
¶ 10 Plaintiff argued the damage to his property was due to theft because intruders came into his home to take the metal and in the process damaged the walls and other fixtures. Plaintiffalso presented evidence that he had been occupying the property prior to the break-ins. This evidence included defendant's investigator's initial determination that the first floor unit "appeared to be lived in" and a statement from plaintiff's neighbor that plaintiff had been living at the property. He asserted that although the gas bill indicated that there was no usage, the meter was not working properly.
¶ 11 Defendant then presented evidence supporting its contention that the loss was a result of vandalism or vandalism with ensuing theft. Defendant's witness, Carlos Cagadas, a claims supervisor, testified that prior to a claims representative inspecting the...
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