## I L L I N O I S 

## O F F I C I A L 

## RE P O R T S Appellate Court

Ent erprise Leasing Co. of St. Loui s v. Hardin , 2011 IL App (5th) 100201

Appellate Court Caption ENTERPRI SE L EASI NG COMPANY OF ST. L OU I S
, PlaintiffAppellant, v. L I

NDA HA RDI

N, Def endant- Appellee

.

District & N o. Fifth District Docke t No. 5-10-0201

Filed September 8, 2011

Held (Note : Thi s syl lab us

con s t it ute s no par t of the opi nio n of the cour t but has bee n pre

par ed b y the Repo rt er of D e c i s i o n s f

o r t h e

c o n v e n i e n c e o

f t h e

rea der

. ) In an ac tion that arose from an automobil e accident that occur red while defe ndant was driving a car she rente d from plaintiff for a busi ness t rip and two passeng ers who wer e her cowor kers wer e injured, the trial court proper ly enter ed summary judgme nt for defe ndant when plaintiff paid claims to the two passeng ers and then soug ht indemnificat i on from defe ndant pursuant t o t he renta l contra ct, since the pay ments plaintiff made to the passeng ers wer e not within the scope of the renta l contra ct’s indemnity clause and requiring defe ndant to pay to settle her cowor kers’ claims would be at odds with the W orker s’ Compensation Act.

Dec ision Under Review Appea l from the Circuit Court of Wil liamson County
, No. 09-L M-312; the Hon. Ronald R. Eckiss, J udg e, pre siding.

J udg ment Affir med.Counsel on

Appea l J eff rey S. De utschman, of De utschman & Associates, P.C., of Chicag o, for a ppellant.

J ames B . Ble y er, of

Ble y er & Ble y er, of

Marion, for

appellee

.

Panel PRES I DI NG J USTI CE CHAPMAN delivere d the judgme nt of the court, with opinion.
J ustices Welch and Spomer c oncurr ed in the judg ment and opinion.

OP INION

¶ 1 The defe ndant, L inda Har din, rente d a vehicle from the plaintiff, E n t erp ri s e L easing Company of St. L ou i s , fo r a business trip. Two of her cowor kers wer e passeng ers in the vehicle. Both passeng ers wer e injured in an acc ident while Har din was driving in Kentucky

. The plaintiff paid claims to the two passeng ers and then soug ht indemnification from the defe ndant pursuant to the renta l contra ct. The trial court g rante d the defe ndant’s motion for
summary judgme nt, finding that (1) once the plaintiff paid the cowor ker/pa sseng ers’ claims, it “steppe d into [t heir] shoes” and (2) their claims ag ainst the defe ndant would b e barr ed under the Workers’ Compensation Act (820 I L CS 305/1 et seq. (West 2006)). The plaintiff
appea ls that ruling
, arguing that (1) its claim is not barr ed by the Workers’ Compensation Act beca use it is a claim for indemnifi cation, not subrog ation, and (2) the voluntary -pay ment doctrine is not applica

ble. We aff

irm. ¶ 2 The defe ndant rente d a car from the plaintiff for a business t ri p

. S h e wa s driving in Kentucky when she collided with a median, injurin g h er two passeng ers. Both passeng ers

wer e the defe ndant’s cowor kers, and all three wer e acting in the course of their employ ment when the collision occur red. The passeng ers, Christopher Cag le and J ere my Hess, filed worke rs’ compensation claims for their injuries. They also submitt ed persona l injury claims to the plaintiff. The pla intiff paid Cag le and He ss $16,250 in settlement of those claims. ¶ 3 The plaintiff subsequently filed a complaint ag ainst the defe ndant seeking to rec over the $16,250 it paid on her behalf

. The complaint alleg ed t h at the defe ndant had brea ched the
contra ct by driving t h e v eh i cl e outside the State of I llinois and that she had driven
neg lige ntly

. The complaint further alleg ed that the plaintiff paid claims of $16,250 as a result of the defe ndant’s neg lige nce. Attache d to the complaint was the renta l contra ct. In rele vant part, the contra ct provided that th e d ef en d ant was to indemnify and hold harmless the plaintiff for any losses it sustained as a result of her use of the car , including claims of third parties. ¶ 4 The defe ndant fi l ed a m o t i o n fo r s ummary judgme nt, arg uing that (1) the plaintiff’s claimed rig ht to pay

ment from the defen d an t was derivative of Cag le and Hess’s cause of

-2-action ag ainst her and (2) the exclusivi ty provision of the Workers’ Compensation Act bars

claims ag ainst a cowor

ker for injuries sustained in the cours e of employ ment due to the
neg lige nce of the cowor

ker. See 820 I L CS 305/5(a) (West 2006); Ramsey v. Morrison
, 175 I ll. 2d 218, 224, 676 N.E.2d 1304, 1307 (1997). ¶ 5 The plain t i ff fi l ed a re s ponse to the defe ndant’s motion. In the response , the plaintiff alleg ed that the renta l ag ree ment require d the d ef en d an t t o indemnify it for any losses it sustained as a re s ult of her neg lige nce. The plaintiff further alleg ed that the defe ndant declined supplemental liability cover ag e, which would have paid for the claims, and that she had not submitt ed the claims to her own ca r insurance company

. I t also alleg ed that its
repr esentative did not know that the acc ident was work-r elated or that Cag le and Hess wer e the defen d an t ’s cowor

kers. The plaintiff argued that it was require d to settle Cag le’s and Hess’s c laims under the mandatory insurance law (625 I L CS 5/9-101 et seq. (West 2006)) and that the Workers’ Compensation Act was not rele vant beca use there was no employ

ment relationship between the pla intiff and the de fenda nt or her injure d cowor

kers. ¶ 6 The defe ndant filed a reply to the plaintiff’s response in which she argued that Hess and Cag le did not have common law claims ag ainst the defe ndant due to the exclusivi ty provision of the Workers’ Compensation Act. See 820 I L C S 305/5(a) (West 2006). As a result, she
argued, the plaintiff was not oblige d to pay thei r cl ai m s o n her behalf

. Thus, she argued,
pay ment of the claims was a voluntary pay ment for which she had no obligation to indemnify the plaintiff. ¶ 7 The plaintiff responde d, repe ating its alleg ations that the repr esentat i v e wh o handled Cag le’s and Hess’s claims did not know that the passeng ers wer e the defe ndant’s cowor kers

or that the acc ident occur

red in the course of their employ ment. The plaintiff arg

ued that, as such, the mistake-of- fac t e x ception to the voluntary -pay ment doctrine a

pplied. Finally
, the defe ndant responded wit h an affidavit from the attorney who re p re s en ted C ag le and Hess. He aver red that the medical rec ords he submitt ed in support of their claims clea rly indicated th at i t was a work-r elated acc ident. As previously mentioned, the court g rante d the defe ndant’s motion for summary judgme nt. This appeal f

ollowed. ¶ 8 Our revie w of a ruling on a motion for summary judgme nt i s d e n o vo

. S u m m ar y judgme nt is appropr iate when the pleading s, depositions, and aff idavits on file, viewed in the light most favor able to the nonmoving party , show that there is no g enuine issue of materia l fac t a nd the moving party is e ntitled to a judgme nt as a matter of law. Home Insurance Co.

v. Cincinnati Insurance Co

. , 2 1 3 I ll. 2d 307, 315, 821 N.E.2d 269, 275 (2004). We may aff irm the trial court’s decision to g rant or deny a motion for summary judgme nt on any basis
appea ring in the rec ord, even if it is not the basis the trial co u rt gav e fo r its ruling

. Home InsuranceCo. , 213 I ll. 2d at 315, 821 N.E.2d at 275-76. ¶ 9 The plaintiff first argues that the trial court err ed i n fi n d i n g its claim barr ed by the Workers’ Compensation Ac t. We disagr ee. ¶ 10 Section 5(a) of the Worker s’ Compensation Act provide s, in releva nt part: “No common l aw o r s t atutory rig ht to rec over damag es from the employ er *** or the
ag ents or employees of

[t he employer] for injury *** sustained by

any employ ee while
eng ag ed in the line of his du t y as s uch employ ee, other than the compensa tion here in

-3-provided, is available to any employ ee who is cover ed by the provisions of this Act ***.” 820 I L CS 305/ 5(a) (West 2006). This provision g ives employees immunit y from liability for n egl ige nce that injures their

cowor kers. Ramsey , 175 I ll. 2d at 224, 676 N.E.2d at 1307. ¶ 11 As previously noted, the plaintiff argued to the trial court that this statutory provision was inapplicable beca

use it did not have an employer- employ ee rela tionship with the defe ndant

or the injured passeng ers. Howeve r, courts that have considere d this provision in the context of third-par

ty claims have g ener ally conclude d that t he rig hts of third parties yield to this provision where it is necessar y to promote the g oals of the Worker s’ Compensation Act. ¶ 12 In Kotecki v. Cyclops W elding Corp.
, 146 I ll. 2d 1 5 5
, 5 8 5 N.E.2d 1023 (1991), our
supreme court considere d to what extent an employ er could be liable to a third party wher e b oth the third party and the employ er are responsible for an employ ee’ s injury

. Ther e, t h e employ ee was i njured operating a machine i n the course of his employ ment

. He broug ht a products-liability claim ag ainst the manufa cture r of the machine. Kotecki
, 146 I ll. 2d at 156, 585 N.E.2d at 1023. The manufa cture r in t u rn b ro ug ht a third-par ty claim ag ainst the plaintiff’s employer. Kotecki , 146 I ll. 2d at 156, 585 N.E.2d at 1023-24. ¶ 13 There
, as here
, the third party had no employ ment relationship with the injured worke r. Howeve r, this did not mean that the Workers’ Compensation Act was irrele vant to the issue of the employ er’ s potential liabi l i t y t o t h e third party , the manufa cture r of the machine. Instead, the court had to balanc e the interest of the employer, as a participa nt in the worke rs’
compensation sy stem, and the interest of the manufa ctur er i n n ot paying more than its proportionate share of the liability for the plaintiff’s injuries. Kotecki
, 146 I ll. 2d at 164, 585 N.E.2d at 1027. ¶ 14 In deter

mining how best to strike t his balance , the cour t considere d that one of the key
purposes o f t h e worke rs’ compensation sy stem is that both employ ees and employ ers “ ‘re ceive the benef

its of a guara

nteed, fix ed-sc hedule, nonfault rec overy sy stem.’ ” Kotecki
, 146 I ll. 2d at 162-63, 585 N.E.2d at 1026 (quoting L a mbertson v. Cincinnati Corp.
, 257 N.W.2d 679, 684 (Minn. 1977)). The court ultimately adopted a rule previously promulg ated by the Minnesota Supreme Court t hat the third party ’s rig ht to seek contribution from the employ er was limit ed to the amount of the employ er’ s liability to the injured employ ee under the Wo rkers’ Compensation Act. Kotecki
, 146 I ll. 2d at 164, 585 N.E.2d at 1027 (citing Lambertson
, 257 N.W.2d at 689)

. The rea son for this rule is that requiringthe employ er to contribute more than that amount to the employ ee “ ‘throug h the conduit of the third-par ty tortfea sor’ ” would be at odds with the l imitation on employ er liabili ty , a key provis i on of the worke rs’ co m p en s at ion sy stem. Kotecki
, 146 I ll. 2d at 162-63, 585 N.E.2d at 1026 (quoting Lambertson , 257 N.W.2d at 684). ¶ 15 In Ramsey v. Morrison
, the court ag ain co n s i d er ed t he tension betwee n the rig ht to contribution from joint tortfea s o rs and the worke rs’ compensation sy stem, this time in a context closer to the fac ts of the case befor e us. There
, the plaintiff was a passeng er in a truck driven by his cowor

ker when they wer e involved in a collision with another vehicle. Both the plaintiff and his cowor

ker wer e acting in the course of their employ ment when the collision

occur red. Ramsey
, 175 I ll. 2d at 220, 676 N.E.2d at 1305. The plaintiff rec eiv ed wo rker s’

-4-compensation benef its for his injuries from his employer. Ramsey
, 175 I ll. 2d at 220-21, 676 N.E.2d at 1305. He subsequently filed a suit ag ainst the driver of the second car

. The second driver filed a third-par

ty complaint seeking contribution from the employ er. Ramsey
, 175 I ll. 2d at 221, 676 N.E.2d at 1305. The court emphasized that the driver of the truck was immune from liability to his cowor ker under the Workers’ Compensation Act. The court then framed the issue befor e it as “whe ther a third party sued by an inj u re d employ ee may rec over contribution from a coemployee who is immune from a direc t suit by the plaintiff” under the Workers’ Compensation Ac t. Ramsey , 175 I ll. 2d at 224, 676 N.E.2d at 1307. ¶ 16 I n d eciding this question, the court once ag ain considere d the purpose of the re levant provision of the Workers’ Compensation Act and the tension betwee n that provision and the third party ’s rig ht to contribution from a party who may be jointly liable. The court explained that the essential purpose of the worke rs’ compensation sy stem is “ ‘to place the cost of industri al acc idents upon the industry .’ ” Ramsey
, 175 I ll. 2d at 227, 676 N.E.2d at 1308 (quoting Rylander v. Chicago Short Line Ry. Co.
, 17 I ll. 2d 618, 628, 161 N.E.2d 812, 818 (19 5 9)). The court further explained that cowor ker immunit y is a key component of this essential purpose. Ramsey
, 175 I ll. 2d at 229, 676 N.E.2d at 1309. This is beca use allowing

a contribution claim aga i n s t an otherwise immune cowor ker would shift the burden of
compensating the i n

j u re d employ ee from the employ er to the cowor ker. I t would thus “entire ly defe at the eff

ect of the immunit y g rante d to coemployees and would there by defe at

a ce n t ra l purpose of the Workers’ Compensation Act.” Ramsey
, 175 I ll. 2d at 229, 6 7 6 N.E.2d at 1309. The court conclude d that the cowor ker immunit y “pre vails over the rig ht to contribution” and held t hat i t is a bar to third-party contribution claims ag ainst coworke rs. Ramsey , 175 I ll. 2d at 230, 676 N.E.2d at 1310. ¶ 17 The defe ndant contends that Ramsey controls our de c is io n

. T h e p lain ti f f argues, howe ver, that Ramsey is distinguishable beca use it involved contribution rathe r than indemnification. In a related argument, the plain t i ff co n t en d s that the trial court err ed in finding that it had “steppe d into the shoes” of Cag le and Hess afte r i t paid claims to them on behalf of the d ef endant. I t argues that this is so beca use its claim is one for indemnification rath er t h an subrog ation. That is, the plaintiff sued the defe ndant in its own rig ht based on the defe ndant’s
contra ctual obli g ation to reimburse or indemnify

the pl aintiff for any losses it sustained as

a re sult of her ne g lige nce. ¶ 18 In one sense, this is corr ect. Contributio n (w h i ch wa s at i s s u e i n both Ramsey and Kotecki ), subrog ation, and indemnification are distinct cause s of action. Ho me In surance Co.
, 213 I l l

. 2d at 315-16, 821 N.E.2d at 276. Contribution is a remedy that allows jointly liable t ortfea sors to hold other culpable parties responsible for their propor

tionate share of the joint liability

. Ramsey
, 175 I l l

. 2 d at 224, 676 N.E.2d at 1307. By contra st, both indemnification and subr og ation place “the entire burden f or a loss on the party

ultimately liable or re sponsible for it and by whom it should have been discharg ed.” (Emphasis in orig inal.) Home Insurance Co.
, 2 1 3 I ll. 2d at 316, 821 N.E.2d at 276. A party seeking indemnification does so in its own rig ht, while a party seeking subrog ation does so as a

succe ssor to another pa

rty ’s rig ht to pay

ment. Home I

nsurance Co.
, 213 I ll. 2d at 316, 821 N.E.2d at 276. Thus, the plaintiff did not truly “step into the shoes” of the defe ndant’s

cowor kers whe n it paid their claims.

-5-¶ 19 Howeve r, we find that the court rea ched the rig h t result for two rea sons. First, we find

that requiring the defendant to pay for the cost of settl ing her coworker s’ cl aim s would be
at o d d s with a key provision of the Workers’ Compensation Act. Second, as the plaintiff points out, the indemnity it seeks is based on a contra ctual indemnity clause
, and we find that the pay ments made to Cag le and He ss do not fall within the scope of that clause. ¶ 20 We previously disc u s s e d a t le n gth o u r s upreme court’s rationale for finding that cowor ker immunit y bars contribution claims by third parties. We believe that rationale ap p l i es with equal forc e to indemnification claims such as the one at issue here

. Requiring the defe ndant
to bear the cost of t he claims paid by the pl aintiff for which she would have been imm une from liability if sued direc tly would shift the burden of these work-r elated injuries from the employ er to the cowor

ker. We also note that the claims could exceed the limit s place d on the employ er’ s liability by the Workers’ Compensation Act. This wo u l d there by defe at the
purpose of the Workers’ Compensation Act just as surely as would allowing a t h i rd -p ar ty contribution claim under similar c ircumstance s. ¶ 21 Our conclusion is further supported by the fact that the p l ai n t iff seeks indemnification under a contra ctual provision. An indemnity clause in a contra ct is subject to the general rules of contra ct interpre tation applicable to any other contra ctual provision. Virginia Surety Co. v. Northern Insurance Co. of New Y o rk
, 2 2 4 I ll. 2d 550, 556, 866 N.E.2d 149, 153 (2007). Our primary objective in in t erp reting such provisions is there fore to asce rtain and eff ectuate the intent of the parties. The be st indication of the par ties’ intent is the languag e of the provision itself. I f the provision is unambiguous, its words should be g iven their plain and ordina

ry meaning s. Virginia Surety Co. , 224 I ll. 2d at 556, 866 N.E.2d at 153. ¶ 22 The provision at issue he re r ead a s follows:

“Renter shall *** indemnify and hold Owner harmless from all losses, l i abil ities, damag es, injuries, claims, demands, costs, attorney fee s and other expenses incurre d by Owner in any manner from this rent al t ra n s ac t i on or from the use of Vehicle by any person, includingclaims of or liabilities to third parties. Renter m ay prese nt a claim to Renter’ s insurance car

rier for such events or losses, but in a ny event, Rente r shall have final responsibility to Owner for all such losses. This obligation may be limit ed if Renter purcha ses optional Damag e Waiver and/or optional Supplemental L iability Protection.” The plaintiff points to the languag e stating that the clause is applicable to “all losses” arising “in any manner ” from the use of the renta l vehicle. Whil e this languag e is very broad, we do not be lieve it is broad enoug h to e ncompass claims for which the defe ndant cannot be held liable under the law. We must interpre t a contract to be consistent with the l aw and public policy of this state. See Swavely v. Freeway Ford Truck Sales, Inc.
, 298 I ll. App. 3d 969, 976-77, 700 N.E.2d 181, 187 (1998) (explaining that courts cann o t enfor ce contra ctual provisions that violate public policy but that “public policy itself strong ly favor s fre edom to contra ct”) . In addition, we note that the clause provides that the r enter may submit a claim
to h er o wn autom obile insurance company or purcha se supplemental liability protec tion, ei t her of which mi g ht cover the l oss. Neither a driver’s own insurance nor a supplem en t al liability policy will pay claims for which a driver is not liable. L og ically
, the clause is meant to apply to the ty

pes of losses that would be cover ed by these forms o f i n s u rance–that is,

-6-those losses for which the renter is liable. Thus, we find that the cla ims of Hess and C ag le

wer e outside the scope of the indemnity clause

. ¶ 23 Finally
, the plaintiff contends that the voluntary -pay ment doctrine does not bar its claim for two rea sons. First, the plaintiff points out that the voluntary -pay ment doctrine is applicable only to case s involving pay ments from the plaintiff to the defe ndant. See CIMCO Communications, Inc. v. National Fire Insurance Co. of Hartford
, 407 I ll. App. 3d 32, 37-38, 943 N.E.2d 276, 281-82 (2011); see also King v. First Capital Financial Servic es Corp.
, 215 I ll. 2d 1, 36, 828 N.E.2d 1155, 1174 (2005) (finding the doctrine applicable wher e a benef it passed f rom the plaintiff to the defe ndant, althoug h indirectly ). The pla intiff also contends that an exception to the voluntary -pay ment doctrine f

or mistake of f

act is applica

ble her e. ¶ 24 W e need not resolve these arguments. We first note that the trial court did not decide whether the voluntary -pay ment doctrine or the mistake-of- fac t exception was applicable to this case

. Mo re o v er , we believe the principles we have discussed adequately resolve the question befor e us. ¶ 25 For

the fore g oing r easons, we aff irm the judg ment of the trial c ourt.

¶ 26 Affir

med.

-7-