Court Opinion

ID: 9724708
Source: CourtListenerOpinion
Date Created: 2023-08-26 11:09:48.958605+00
Date Added: 2024-06-11T13:10:32.252535
License: Public Domain

PRESIDING JUSTICE MANNING, dissenting: Defendant filed a motion for judgment on the pleadings, arguing that pursuant to its insurance policy, any amount recovered by plaintiff “from or on behalf of a person legally liable for personal injuries” was to be set off against the liability limits of the uninsured motorist provision. Because the liability limit was $100,000, and plaintiff had already received that amount from Anderson’s insurer, defendant had no contractual liability whatsoever to plaintiff. It is well settled that a motion for judgment on the pleadings raises the question of the sufficiency of the pleadings as a matter of law to entitle the plaintiff to the relief sought by the complaint, and the question of whether defendant’s answer sets up a defense to the complaint which would entitle defendant to a hearing on the merits. (Milanko v. Jensen (1949), 404 Ill. 261, 88 N.E.2d 857; see also Teeple v. Hunziker (1983), 118 Ill. App. 3d 492, 496, 454 N.E.2d 1174; Hartlett v. Dahm (1981), 94 Ill. App. 3d 1, 418 N.E.2d 44.) The motion must be denied by the trial court, if upon an examination of all of the pleadings, the court determines the existence of an issue of material fact. (Ill. Rev. Stat. 1985, ch. 110, par. 2 — 615(e); Triangle Sign Co. v. Weber, Cohn & Riley (1986), 149 Ill. App. 3d 839, 501 N.E.2d 315; Berymon v. Henderson (1985), 135 Ill. App. 3d 858, 482 N.E.2d 391; Allis-Chalmers Credit Corp. v. McCormick (1975), 30 Ill. App. 3d 423, 331 N.E.2d 832.) Moreover, a cause of action should not be dismissed on the pleadings unless it clearly appears that no set of facts can be proved which would entitle plaintiff to recover. (Lanier v. Associates Finance, Inc. (1985), 134 Ill. App. 3d 183, 479 N.E.2d 1227, affd (1986), 114 Ill. 2d 1, 499 N.E.2d 440; Golden Rule Life Insurance Co. v. Mathias (1980), 86 Ill. App. 3d 323, 408 N.E.2d 310.) Conversely, judgment on the pleadings is proper when the pleadings disclose only questions of law (Walker v. State Board of Elections (1976), 65 Ill. 2d 543, 359 N.E.2d 113; Howard v. County of Cook (1986), 145 Ill. App. 3d 538, 495 N.E.2d 1166), and the trial court determines that the movant is entitled to judgment. Courts of review in Illinois have held that the entry of judgment on the pleadings is proper only where the trial court determined the relative rights of the parties (In re Estate of Rettig (1981), 100 Ill. App. 3d 653, 427 N.E.2d 235), solely from an examination of all the pleadings on file, having taken as true well-pleaded facts, and reasonable inferences to be drawn therefrom, set forth in pleadings of the party opposing the motion (Triangle Sign Co., 149 Ill. App. 3d at 843; Becker v. Dvorson (1960), 28 Ill. App. 2d 174, 171 N.E.2d 86), and disregarded all surplus-age and conclusory allegations. Teeple, 118 Ill. App. 3d 492; Bank & Trust Co. v. Arnold N. May Builders, Inc. (1980), 90 Ill. App. 3d 454, 413 N.E.2d 183. Here, defendant urges that the plain language of the policy provides that payment by any person who is legally liable for bodily injury to the insured reduces the amount payable under the uninsured motorist provision. Because the construction of an insurance policy presents only a question of law (Donald B. MacNeal, Inc. v. Interstate Fire & Casualty Co. (1985), 132 Ill. App. 3d 564, 566, 477 N.E.2d 1322; State Farm Mutual Automobile Insurance Company v. Schmitt (1981), 94 Ill. App. 3d 1062, 419 N.E.2d 601), the underlying question here, which involves interpretation of the uninsured motorist provision of defendant’s insurance policy, is appropriate for determination by judgment on the pleadings. See Kravis v. Smith-Marine, Inc. (1974), 20 Ill. App. 3d 483, 314 N.E.2d 577. The statute that governs uninsured motor vehicle coverage provides in pertinent part: “[N]o policy insuring against loss resulting from liability imposed by law for bodily injury or death suffered by any person arising out of the ownership, maintenance or use of a motor vehicle shall be renewed or delivered or issued for delivery in this State *** unless coverage is provided *** in limits for bodily injury or death set forth in Section 7 — 203 of The Hlinois Motor Vehicle Code, for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles ***.” Ill. Rev. Stat. 1985, ch. 73, par. 755a(1). The uninsured motorist provision in the State Farm policy provides that the insurer “will pay damages for bodily injury an insured is legally entitled to collect from the driver or owner of an uninsured motor vehicle.” However, the policy further provides that payment by any person who is legally liable for bodily injury to the insured reduces the amount payable under the policy’s uninsured motorist provision. Specifically, section III of the policy, which is entitled “Limits of Liability — Coverage U,” provides, in pertinent part: “1. The amount of coverage is shown on the declarations page under ‘Limits of Liability — U—Each Person, Each Accident.’ Under ‘Each Person’ is the amount of coverage for all damages due to bodily injury to one person. 2. Any amount payable under this coverage shall be reduced by any amount paid or payable to or for the insured: a. by or for any person or organization who is or may be held legally liable for the bodily injury to the insured; b. for bodily injury under the liability coverage; or c. under any workers’ compensation, disability benefits, or similar law.” It is well established that a clear and unambiguous policy provision is to be applied as written and policy language will be given its plain and ordinary meaning (United States Fire Insurance Co. v. Schnackenberg (1981), 88 Ill. 2d 1, 4-5, 429 N.E.2d 1203; Giardino v. American Family Insurance (1987), 164 Ill. App. 3d 389, 391, 517 N.E.2d 1187; Allstate Insurance Co. v. Panzica (1987), 162 Ill. App. 3d 589, 591, 515 N.E.2d 1299), unless it contravenes public policy (Menke v. Country Mutual Insurance Co. (1980), 78 Ill. 2d 420, 423, 401 N.E.2d 539; Scudella v. Illinois Farmers Insurance Co. (1988), 174 Ill. App. 3d 245, 528 N.E.2d 218; Becker v. Country Mutual Insurance Co. (1987), 158 Ill. App. 3d 63, 510 N.E.2d 1316; Potts v. Madison County Mutual Automobile Insurance Co. (1983), 112 Ill. App. 3d 50, 445 N.E.2d 33). While it is correct that limitations on an insurer’s liability must be construed liberally in favor of the insured (Squire v. Economy Fire & Casualty Co. (1977), 69 Ill. 2d 167, 370 N.E.2d 1044), the rule comes into play only where the limitation of liability clause is ambiguous. Menke, 78 Ill. 2d 420. Plaintiff contends and the majority agrees that the effect of the limitation of liability clause here precludes any recovery from one of the tortfeasors and such limitation contravenes public policy and the intent of the uninsured motorist statute. A similar analysis was rejected in Stryker v. State Farm Mutual Automobile Insurance Co. (1978), 74 Ill. 2d 507, 386 N.E.2d 36, and Ullman v. Wolverine Insurance Co. (1970), 48 Ill. 2d 1, 269 N.E.2d 295, where our supreme court upheld the validity of setoff provisions which required that uninsured motorist payments be reduced by the amounts of worker’s compensation awarded a claimant. The rationale advanced in these cases is that the -uninsured motorist statute is intended to place an injured insured in substantially the same position as if the tortfeasor causing the injuries had been insured for the minimum liability insurance required by financial responsibility law. Stryker, 74 Ill. 2d at 511; Ullman, 48 Ill. 2d at 7-8. Recently, the appellate court upheld a clause which allowed the insurer to set off from the uninsured motorist coverage any amounts payable by the uninsured motorist or any other tortfeasor. In Schutt v. Allstate Insurance Co. (1985), 135 Ill. App. 3d 136, 478 N.E.2d 644, plaintiff, a passenger in a car driven by Cynthia Long, was injured when Long’s car collided with a car driven by Tony Munos. Mimos was not insured but Long was insured by Allstate. Following litigation and an appeal, judgment was entered and affirmed, respectively, against Long for $2,500 and Munos for $25,000. Plaintiff then filed a declaratory action against Allstate seeking to recover under its uninsured motorist provisions, and the parties agreed to submit the claim to arbitration. The arbitrators awarded plaintiff $2,500 in full settlement of his claim; however, Allstate claimed that pursuant to its policy, the uninsured motorist award was to be reduced by all sums paid by any other person who was jointly or severally liable. Because Allstate had already paid $2,644.40 on behalf of Long, and the claim was $2,500, Allstate claimed that it had no further obligation. The trial court found that Allstate was entitled to a setoff, and the reviewing court affirmed. The reviewing court stated that the protection afforded by uninsured motorist coverage was not diminished by the limitation. (Schutt, 135 Ill. App. 3d at 140.) The court further enunciated: “Under well-established principles, amounts paid by one or more of the joint tortfeasors are to be applied in reduction of the damages recoverable from those remaining in the suit. [Citation.] Payments made by one of the tortfeasors on account of the tort either before or after judgment diminish the claim of an injured person against all others responsible for the same harm. [Citations.] Without such a reduction, plaintiff may improperly receive damages in excess of injuries sustained. [Citation.] The purpose of compensatory tort damages is to compensate; it is not the purpose of such damages to punish defendants or bestow a windfall upon plaintiffs. [Citation.] Double recovery for the same injury is a result to be condemned. [Citation.] We conclude from this summary of the law that the setoff clause only acts to prevent double recovery in accordance with principles of Illinois law on damages and does not prejudice a plaintiff who has sustained injuries as a result of the negligence of an insured motorist.” Schutt, 135 Ill. App. 3d at 140. Using reasoning consistent with that in Ullman and Stryker and in reliance on Schutt, I would hold that absent a statutory provision to the contrary, the provision in defendant’s policy which permits it to deduct payments paid or payable to its insured from one legally liable to him or her from the limits of uninsured motorist coverage is not offensive to public policy. Moreover, I believe that the cases cited to by plaintiff are inapposite to the factual matrix here presented. The holdings in Maid v. Illinois Farmers Insurance Co. (1981), 101 Ill. App. 3d 1065, 428 N.E.2d 1139, Goss v. State Farm Mutual Automobile Insurance Co. (1986), 147 Ill. App. 3d 866, 498 N.E.2d 562, and Potts v. Madison City Mutual Automobile Insurance Co. (1983), 112 Ill. App. 3d 50, 445 N.E.2d 33, were limited to the issue of stacking separate policies issued by one insurer and the courts’ reasoning in reaching those holdings is irrelevant to the issue of limitation of liability or setoff. I realize that my proposed disposition here would render a result where plaintiff is precluded from any recovery from her tortfeasor spouse. However, the clause in the policy is not made void by reason of this unfortunate result, or because the plaintiff’s total damages possibly exceed the amount recoverable. Under other circumstances plaintiff would be entitled to recover, i.e., where the amount paid by the uninsured motorist or joint tortfeasor was less than the $100,000 limit of defendant’s uninsured motorist coverage. When a court interprets an insurance policy, there are only two sources upon which it may base, its analysis: the plain language of the policy and the plain language of the Insurance Code of 1937 as it existed at the time the policy was written. Bailey v. State Farm Fire & Casualty Co. (1987), 156 Ill. App. 3d 979, 984, 509 N.E.2d 1064. Moreover, the uninsured motorist statute provides in section 143(aX4) that: “In the event of payment to any person under the coverage required by this Section and subject to the terms and conditions of such coverage, the insurer making such payment shall, to the extent thereof, be entitled to the proceeds of any settlement or judgment resulting from the exercise of any rights of recovery of such person against any person or organization legally responsible for the property damage, bodily injury or death for which such payment is made, including the proceeds recoverable from the assets of the insolvent insurer.” Ill. Rev. Stat. 1985, ch. 73, par. 755a(4). The trial court determined that plaintiff had received $100,000 from Anderson. Under the terms of the policy, that amount was to be set off from the maximum amount of uninsured coverage available to plaintiff, which was also $100,000. Thus, I agree with the trial court’s finding that there was no available uninsured motorist coverage for plaintiff’s claim. An insurer, who is governed by guidelines and restrictions enacted by the legislature, has the right to limit coverage on a policy it issues, and when it has done so, the clear and unambiguous language of the policy limitation clause must be given meaning, and the courts must construe and enforce the contract as made. Kaszeski v. Fidelity & Casualty Co. (1973), 54 Ill. 2d 241, 296 N.E.2d 743; Gray v. Great Central Insurance Co. (1972), 4 Ill. App. 3d 1084, 283 N.E.2d 261. In light of the statutory mandate and the policy’s unambiguous provision here which states its limit of liability, I would affirm the judgment of the trial court which granted judgment on the pleadings to defendant. Accordingly, I respectfully dissent from the majority opinion.