Court Opinion

ID: 9738093
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:42:33.747438+00
Date Added: 2024-06-11T10:38:46.484947
License: Public Domain

JUSTICE HARRISON,*  dissenting in part: I believe the majority is correct in analogizing the relationship between the Hills and Mrs. Tharp to that of landlord and tenant. To be sure, Mrs. Tharp was able to continue occupying a portion of the premises by providing for reservation of a life estate in the contract for deed under which the property was sold to the Hills, and not by virtue of an actual lease. Nevertheless, the Hills presumably paid less for the property because of the life estate reserved by Mrs. Tharp than they would have otherwise. To the extent that the purchase price was lower than the actual value of the property because of that reserved life estate, the disparity can be construed as being equivalent to prepaid rent tendered to the Hills by Mrs. Tharp. Similarly, the provisions of the contract for deed governing the terms of the life estate are comparable to a lease agreement between them. At common law, a tenant is responsible for damage to leased premises resulting from his or her own negligence. (Anderson v. Peters (1986), 142 Ill. App. 3d 182, 187, 491 N.E.2d 768, 772 (Heiple, J., dissenting).) The parties may, of course, agree that a tenant should not be so liable. An express exculpatory provision in the lease is not required in order to exonerate the lessee for his or her negligently caused fires. (Continental Casualty Co. v. Polk Brothers, Inc. (1983), 120 Ill. App. 3d 395, 400, 457 N.E.2d 1271, 1275.) Whether a lessee’s negligence is to be exculpated turns, instead, on the intent of the parties, and “the key factor in determining whether the parties intended to exculpate lessee negligence is the allocation of insurance burdens as evidenced by the terms of the lease.” 120 Ill. App. 3d 395, 401, 457 N.E.2d 1271, 1276. The proper construction to be given a lease is to be determined from the instrument as a whole. (One Hundred South Wacker Drive, Inc. v. Szabo Food Service, Inc. (1975), 60 Ill. 2d 312, 314, 326 N.E.2d 400, 402.) The contract for deed here expressly provided that the Hills were obligated only to have the building insured and to name the Tharps as coinsureds with them on any policy covering the building. This was sufficient to prevent Country Mutual, the Hills’ insuror, from bringing a subrogation claim against Mrs. Tharp to recover the amount it paid out for damage to the building, even though the damage resulted from Mrs. Tharp’s negligence. I fail to see, however, how that obligation can be extended to bar a subrogation claim against Mrs. Tharp arising from the damage she caused to the Hills’ personal property. While the life estate provisions in the contract for deed may be comparable to a lease agreement, we must not overlook that the real purpose of the contract was the sale of certain real estate and the building situated thereon. The most logical explanation for the requirement that the Hills obtain insurance on the building was, in my view, simply that the Tharps wanted to make sure that they would still be paid for their property even if the building were damaged or destroyed before title transferred to the Hills. The contract makes no mention of any further obligation by the Hills to obtain insurance against the loss of their or anyone else’s personal property, or to name Mrs. Tharp as a coinsured on any policies other than those covering the building. With respect to personal property, I believe that the contract, at most, contemplated that the parties would each secure their own separate insurance, and this is what they in fact did. While Mrs. Tharp unfortunately failed to secure enough insurance to cover the loss to the Hills’ personal property which she caused, that was her responsibility. I know of no rule of law or equity by which we can reform or modify the contract after the fact to relieve Mrs. Tharp of what proved to be her own mistake. Because I therefore do not believe that Mrs. Tharp was intended or can be considered to be a coinsured under the Hill’s insurance policy with respect to the Hills’ personal property, I must conclude that she is subject to an action for damages by the Hills for the benefit of their insuror with respect to the $67,000 which the Hills’ insuror had to pay for the loss of the Hills’ personal property caused by Mrs. Tharp’s negligence. I would therefore reverse the trial court’s dismissal of amended count II of the Hills’ counterclaim. In all other respects I concur in the result reached by the majority. Tharp’s amended counterclaim was correctly dismissed. Tharp is not subject to a judgment against her for the benefit of the Hills’ insurer with respect to damage to the building, given that the Hills should have named her as a coinsured on their policy covering loss to that building; I do not believe that she can claim damages from the Hills arising from their failure to name her as a coinsured with respect to their insurance covering loss to their personal property, in view of my previous conclusion that the Hills were not obligated under the contract to provide such insurance or to so name her; for the reasons set forth in the majority’s opinion, the Hills were likewise not required to provide coverage for the losses “to buildings and other property outside [the] agreement and owned by third persons”; and as the majority correctly notes, this is not a situation to which the provision in the contract pertaining to attorneys fees applies. In sum, while I concur in the dismissal of Tharp’s amended counterclaim, I would reverse the dismissal of amended count II of the Hills’ counterclaim and remand for further proceedings.   Justice Harrison replaces Justice Jones, who retired after the cause was taken under advisement.