Court Opinion

ID: 3135397
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:36:47.756209+00
Date Added: 2024-06-11T11:42:16.053196
License: Public Domain

Docket No. 103816.

                             IN THE
                      SUPREME COURT
                                OF
                THE STATE OF ILLINOIS

STATE FARM MUTUAL AUTOMOBILE INSURANCE
COMPANY et al. (State Farm Mutual Automobile Insurance
Company, Appellant) v. ILLINOIS FARMERS INSURANCE
               COMPANY et al., Appellees.

                 Opinion filed September 20, 2007.

   JUSTICE KARMEIER delivered the judgment of the court, with
opinion.
   Chief Justice Thomas and Justices Freeman, Fitzgerald, Kilbride,
Garman, and Burke concurred in the judgment and opinion.

                             OPINION

    The issue in this case is whether the “step-down” provisions,
which reduce the policy limits for permissive users, of several
automobile liability policies issued by Illinois Farmers Insurance
Company and one of it subsidiaries, Mid-Century Insurance Company
(Farmers), to Illinois policyholders are void and unenforceable
because they violate Illinois public policy. The trial court found the
“step-down” provisions were contrary to public policy and, therefore,
void and unenforceable. The appellate court found the “step-down”
provisions are not contrary to public policy and reversed the trial
court on this issue. 368 Ill. App. 3d 914. We granted the petition for
leave to appeal by State Farm Mutual Automobile Insurance
Company. 210 Ill. 2d R. 315. For the reasons that follow, the
judgment of the appellate court is affirmed in part and vacated in part,
and the matter is remanded to the trial court.

                             BACKGROUND
    State Farm filed its second amended complaint seeking
declaratory, injunctive and monetary relief from Farmers with respect
to the step-down provisions contained in Farmers’ automobile liability
policies issued to Illinois policyholders. The first four counts deal with
money State Farm spent covering losses after Farmers invoked its
step-down provisions in four separate and distinct situations, each of
which is covered in one of the first four counts. Farmers’ step-down
provisions reduce the policy limits to the minimum liability limits
required under sections 7–203 and 7–317(b) of the Illinois Safety and
Family Financial Responsibility Law (625 ILCS 5/7–203, 7–317(b)
(West 2002)) when the insured’s vehicle is being operated by a
permissive user who is neither a family member residing in the
insured’s household or a listed driver. Section 7–203 and section
7–317(b)(3) require every liability insurance policy issued to provide
coverage not less than $20,000 for the death or bodily injury of any
one person, $40,000 for the death or bodily injury of two or more
persons, and $15,000 for property damage occurring in any one motor
vehicle accident. 625 ILCS 5/7–203, 7–317(b)(3) (West 2002).
    Farmers filed a motion to dismiss counts I through IV of State
Farm’s complaint, arguing that the step-down provisions contained in
its policies are clear and unambiguous and that the reimbursement
sought by State Farm is an impermissible direct action. In response,
State Farm filed a motion for partial summary judgment on counts I
through IV, arguing that the step-down provisions in Farmers’ polices
were contrary to Illinois public policy and therefore void and
unenforceable. The trial court denied Farmers’ motion to dismiss,
granted State Farm’s motion for partial summary judgment as to
counts I through IV of the complaint on the public policy issue only,
made a written finding there was no just reason to delay the
enforcement or appeal or both of the order granting State Farm’s
motion for partial summary judgment pursuant to Supreme Court Rule
304(a) (210 Ill. 2d R. 304(a)), and stayed all proceedings pending the
resolution of the public policy issue on appeal.

                                   -2-
     On appeal, in addition to briefing the public policy issue, Farmers
briefed the ambiguity and direct action issues raised in the trial court
in its motion to dismiss. State Farm moved to strike the ambiguity and
direct action issues from Farmer’s brief, arguing that the trial court’s
Rule 304(a) finding was specifically limited to the public policy issue.
The appellate court denied State Farm’s motion to strike holding that
the ambiguity and direct action issues were properly before that court.
     After the appellate court found Farmers’ step-down provisions are
not contrary to Illinois public policy and are enforceable, it reversed
the trial court’s order granting the motion for partial summary
judgment and remanded the cause for further proceedings. 368 Ill.
App. 3d at 927. Additionally, the appellate court found that State
Farm’s actions against Farmers were not impermissible direct actions
under Illinois law and that Farmers’ step-down provisions were clear
and unambiguous as a matter of law. 368 Ill. App. 3d at 921-22. We
granted State Farm’s petition for leave to appeal (210 Ill. 2d R. 315).
In addition, we allowed the Illinois Trial Lawyers Association to file
an amicus curiae brief in support of State Farm.

                            ANALYSIS
                         Standard of Review
    Summary judgment is proper where the pleadings, depositions,
admissions, and affidavits on file, viewed in the light most favorable
to the nonmoving party, reveal that there is no genuine issue as to any
material fact and the moving party is entitled to a judgment as a matter
of law. Progressive Universal Insurance Co. of Illinois v. Liberty
Mutual Fire Insurance Co., 215 Ill. 2d 121, 127-28 (2005). Whether
summary judgment was appropriate is a matter we review de novo.
General Casualty Insurance Co. v. Lacey, 199 Ill. 2d 281, 284
(2002). In addition, the construction of provisions contained in an
insurance policy is a question of law reviewed de novo. Travelers
Insurance Co. v. Eljer Manufacturing, Inc., 197 Ill. 2d 278, 292
(2001), citing American States Insurance Co. v. Koloms, 177 Ill. 2d
473, 479-80 (1997).

                              Public Policy
   State Farm argues that the step-down provisions contained in
Farmer’s policies violate Illinois’ public policy and are therefore void

                                  -3-
and unenforceable. The terms contained in an insurance policy will be
applied as written unless those terms are contrary to public policy.
Illinois Farmers Insurance Co. v. Cisco, 178 Ill. 2d 386, 392 (1997);
Menke v. Country Mutual Insurance Co., 78 Ill. 2d 420, 423 (1980).
The public policy of this state is reflected in its constitution, statutes,
and judicial decisions. O’Hara v. Ahlgren, Blumenfeld & Kempster,
127 Ill. 2d 333, 341 (1989); McClure Engineering Associates, Inc. v.
Reuben H. Donnelley Corp., 95 Ill. 2d 68, 72 (1983). Terms of an
insurance policy that conflict with a statute are void. State Farm
Mutual Automobile Insurance Co. v. Smith, 197 Ill. 2d 369, 372
(2001); Cisco, 178 Ill. 2d at 392. Additionally, terms of an insurance
policy cannot circumvent the underlying purpose of a statute in force
at the time of the policy’s issuance. State Farm Mutual Automobile
Insurance Co. v. Smith, 197 Ill. 2d 369, 372 (2001); Cummins v.
Country Mutual Insurance Co., 178 Ill. 2d 474, 483 (1997).
     We are guided by established principles of statutory construction
in determining whether the legislative mandates of this state are
violated by Farmers’ step-down provisions. The cardinal rule of
statutory construction, and the one to which all other cannons and
rules must yield, is to ascertain and give effect to the true intent and
meaning of the legislature. Progressive Universal Insurance Co. of
Illinois v. Liberty Mutual Fire Insurance Co., 215 Ill. 2d 121, 134
(2005), citing Country Mutual Insurance Co. v. Teachers Insurance
Co., 195 Ill. 2d 322, 330 (2001). The most reliable indicator of
legislative intent is found in the language of the statute. Midstate
Siding & Window Co. v. Rogers, 204 Ill. 2d 314, 320 (2003), citing
Michigan Avenue National Bank v. County of Cook, 191 Ill. 2d 493,
504 (2000). Statutory language is afforded its plain and ordinary
meaning. Midstate Siding & Window Co., 204 Ill. 2d at 320, citing
Michigan Avenue National Bank, 191 Ill. 2d at 504.
     With these principles in mind, we now turn to the statutory
pronouncements of our legislature. Section 7–601(a) of the Illinois
Safety and Family Financial Responsibility Law, in pertinent part,
provides:
             “No person shall operate, register or maintain registration
         of, and no owner shall permit another person to operate,
         register, or maintain registration of, a motor vehicle designed

                                   -4-
         to be used on a public highway unless the motor vehicle is
         covered by a liability insurance policy.
              The insurance policy shall be issued in amounts no less
         than the minimum amounts set for bodily injury or death and
         for destruction of property under Section 7–203 of this Code,
         and shall be issued in accordance with the requirements of
         Sections 143a and 143a–2 of the Illinois Insurance Code, as
         amended.” 625 ILCS 5/7–601(a) (West 2002).
Section 7–203 requires every liability insurance policy issued to
provide coverage of not less than $20,000 for the death or bodily
injury of any one person, $40,000 for the death or bodily injury of two
or more persons, and $15,000 for property damage occurring in any
one motor vehicle accident. 625 ILCS 5/7–203 (West 2002).
    In addition, liability insurance required by section 7–601 must
comply with the requirements of section 7–317(b)(2) of the Illinois
Safety and Family Financial Responsibility Law (625 ILCS
5/7–317(b)(2) (West 2002)). Section 7–317(b)(2) requires an owner’s
policy of liability insurance to insure the person named therein and any
other person using or responsible for the use of such motor vehicle or
vehicles with the express or implied permission of the insured. 625
ILCS 5/7–317(b)(2) (West 2002). Provisions which extend liability
coverage to permissive users are referred to as “omnibus clauses”
(Progressive Universal Insurance Co. of Illinois, 215 Ill. 2d at 128),
and our court has held that such a clause must be read into every
liability insurance policy (State Farm Mutual Automobile Insurance
Co. v. Universal Underwriters Group, 182 Ill. 2d 240, 243-44
(1998)).
      Section 7–317(b)(3) of the Illinois Safety and Family Financial
Responsibility Law requires every owner’s policy of liability insurance
to “insure every named insured and any other person using or
responsible for the use of any motor vehicle owned by the named
insured and used by such other person with the express or implied
permission of the named insured *** to the extent and aggregate
amount of $20,000 for bodily injury to or death of one person as a
result of any one accident and, subject to such limit as to one person,
the amount of $40,000 for bodily injury to or death of all persons as
a result of any one accident and the amount of $15,000 for damage to

                                  -5-
property of others as a result of any one accident. 625 ILCS
5/7–317(b)(3) (West 2002).
      We find nothing in the foregoing statutory language to support
State Farm’s contention that a liability insurance policy providing the
named insured with coverage in excess of the statutory minimum
required by section 7–203 must provide the same level of coverage to
permissive users. Contrast this with section 143a–2(4) of the Illinois
Insurance Code, incorporated into section 7–601(a) of the Illinois
Safety and Family Financial Responsibility Law by reference, which
prohibits the issuance of a liability insurance policy issued on or after
July 1, 1983, “unless underinsured motorist coverage is included in
such policy in an amount equal to the total amount of uninsured
motorist coverage in that policy where such uninsured motorist
coverage exceeds the limits set forth in Section 7–203 of the Illinois
Vehicle Code.” 215 ILCS 5/143a–2(4) (West 2002). The language
contained in section 143a–2(4) of the Illinois Insurance Code shows
that when the legislature intends different types of coverage in excess
of the minimum statutory requirements mandated by section 7–203 of
the Illinois Safety and Family Financial Responsibility Law to be the
same, it chooses plain, unambiguous language to indicate its intent.
     Previously, this court has held that the principal purpose behind
Illinois’ mandatory liability insurance requirement and its omnibus
provision “is to protect the public by securing payment of their
damages.” Progressive Universal Insurance Co. of Illinois v. Liberty
Mutual Fire Insurance Co., 215 Ill. 2d 121, 129 (2005); State Farm
Mutual Automobile Insurance Co. v. Smith, 197 Ill. 2d 369, 376
(2001). Sections 7–203 and 7–317(b)(3) of the Illinois Safety and
Family Financial Responsibility Law mandate that liability insurance
policies provide $20,000/$40,000/$15,000 coverage for the named
insured and permissive users of the named insured’s vehicle. By
setting the minimum coverage limits at $20,000/$40,000/$15,000, we
assume that the legislature has decided that this amount of coverage
is sufficient to protect members of the public and secure payment for
damages they may sustain.
     Because we find nothing in the statutory pronouncements of our
legislature prohibiting Farmers’ step-downs and because Farmers’
policies provide coverage to the named insured and permissive users
of the named insured’s vehicle in an amount determined by the

                                  -6-
legislature to be sufficient to accomplish the principal purpose behind
Illinois’ mandatory liability insurance requirements and its omnibus
provisions, we cannot say that the policies issued by Farmers in this
case are contrary to the statutory pronouncements of our legislature
or the underlying purpose of the Illinois Safety and Family Financial
Responsibility Law.
     State Farm argues, nevertheless, that the public policy
considerations underlying Illinois’ mandatory insurance laws as
construed in our decisions in State Farm Mutual Insurance Co. v.
Smith, 197 Ill. 2d 369 (2001), Progressive Universal Insurance Co.
of Illinois v. Liberty Mutual Fire Insurance Co., 215 Ill. 2d 121
(2005), and State Farm Mutual Automobile Insurance Co. v.
Universal Underwriters Group, 182 Ill. 2d 240 (1998), along with the
appellate court decisions in John Deere Insurance Co. v. Allstate
Insurance Co., 298 Ill. App. 3d 371 (1998), Fuller v. Snyder, 323 Ill.
App. 3d 303 (2001), and Browning v. Plumlee, 316 Ill. App. 3d 738
(2000), prohibit Farmers’ step-down provisions. We disagree.
     In Smith and Progressive this court was called upon to determine
whether complete exclusions from liability insurance policies violated
Illinois public policy. In Smith, Maurice Barnes, accompanied by
Smith, drove to Harrah’s Casino, where he allowed Harrah’s valet
service to park his vehicle. When Barnes and Smith left Harrah’s,
Fisher, a valet driver employed by Harrah’s, retrieved Barnes’ vehicle.
As Smith entered the passenger door, Barnes’ vehicle rolled
backwards, striking Smith, which knocked her to the ground causing
her injury. Smith, 197 Ill. 2d at 371. At the time of the accident,
Barnes’ vehicle was insured under a policy issued by State Farm. State
Farm’s policy contained a “car business exclusion clause.” The
exclusion read: “ ‘THERE IS NO COVERAGE: 1. WHILE ANY
VEHICLE INSURED UNDER THIS SECTION IS: *** b. BEING
REPAIRED, SERVICED OR USED BY ANY PERSON
EMPLOYED OR ENGAGED IN ANY WAY IN A CAR
BUSINESS.’ ” (Emphasis in original.) Smith, 197 Ill. 2d at 372-73.
State Farm defined car business as “ ‘a business or job where the
purpose is to sell, lease, repair, service, transport, store or park land
motor vehicles or trailers.’ ” Smith, 197 Ill. 2d at 373. We held that
when a vehicle’s “owner gives his vehicle to a person engaged in an
automobile business ***, the owner is giving that person express or

                                  -7-
implied permission to use the vehicle.” Smith, 197 Ill. 2d at 374. We
went on to say that State Farm’s car business exclusion violated
Illinois public policy as expressed in section 7–317(b)(2) because “a
provision written into an insurance policy that excludes coverage for
persons engaged in an automobile business necessarily excludes
coverage for persons who are using an insured’s vehicle with the
insured’s express or implied permission.” Smith, 197 Ill. 2d at 374.
     In Progressive, Shirley Abbinante owned a vehicle insured under
a policy issued by Progressive. Abbinante allowed her son, Ronald, to
use the insured vehicle to deliver pizzas for his employer. Ronald was
compensated by a flat fee for each pizza he delivered. During one of
his deliveries, Ronald struck a pedestrian, Lavit, who sustained severe
injuries as a result of the accident. Progressive, 215 Ill. 2d at 124.
Progressive’s policy contained a “food delivery exclusion.” The
exclusion stated that coverage under the policy did not apply to bodily
injury or property damage while an insured vehicle was “ ‘being used
to carry persons or property for compensation or a fee, including, but
not limited to, delivery of *** food, or any other
products.’ ”Progressive, 215 Ill. 2d at 125.
     We upheld the “food delivery exclusion” against attack that it
violated public policy (Progressive, 215 Ill. 2d at 134) and stated:
“Because the requirement to maintain liability insurance is statutory in
origin, any restrictions on the insurance required to comply with the
law must also emanate from our statutes.” Progressive, 215 Ill. 2d at
136. We said that the legislature could easily have prohibited insurers
from excluding certain risks in liability insurance policies but it chose
not to do so. Progressive, 215 Ill. 2d at 138. Smith was distinguished
because the exclusion at issue in Smith only excluded permissive users
while engaged in a car business but the named insured was free to
engage in a car business without compromising his liability coverage.
Progressive, 215 Ill. 2d at 133. We believe Smith and Progressive are
inapplicable to the facts in this case. Those cases dealt with equal
treatment with regard to coverage for owners and permissive drivers,
not liability limits. Here the disputed issue is whether the limits of
coverage provided to a permissive user must be the same as the limits
of coverage provided to the owner of the vehicle.
     The remaining cases cited by State Farm involve interpretations of
the car dealer licensing provisions of the Motor Vehicle Code (625

                                  -8-
ILCS 5/5–100 et seq. (West 2002)). Section 5–101(b)(6) of the Code
provides:
         “A Certificate of Insurance *** shall be included with each
         application ***. The policy must provide liability coverage in
         the minimum amounts of $100,000 for bodily injury to, or
         death of, any person, $300,000 for bodily injury to, or death
         of, two or more persons in any one accident, and $50,000 for
         damage to property.” 625 ILCS 5/5–101(b)(6) (West 2002).
Section 5–102(b)(4) provides an identical licensing requirement for
dealers of used automobiles. 625 ILCS 5/5–102(b)(4) (West 2002).
     In State Farm Mutual Automobile Insurance Co. v. Universal
Underwriters Group, 182 Ill. 2d 240 (1998), the question before this
court was “whether a car dealer’s garage policy covers the liability of
a separately insured customer who is involved in an accident while
test-driving one of the dealer’s vehicles.” State Farm, 182 Ill. 2d at
241. Joyce Pontiac, a car dealer, allowed Luckhart to test-drive one
of its vehicles. During this test-drive, Luckhart negligently collided
with another vehicle owned by Carter and operated by Calinee, both
of whom sustained personal injury as a result of the collision. Joyce
Pontiac was insured under a garage policy issued by Universal.
Luckhart was insured under a policy issued by State Farm, which paid
a total of $9,092.15 to Carter and Calinee for personal injuries and
property damage they sustained in the collision. State Farm, 182 Ill.
2d at 241. Thereafter, State Farm sought reimbursement from
Universal, alleging that Universal’s policy afforded primary coverage
to Luckhart while test-driving Joyce Pontiac’s vehicle. Under the
terms of the garage policy issued to Joyce, Universal agreed to
provide coverage to any person “ ‘required by law to be an
INSURED’ ” while using a covered automobile within the scope of
Joyce’s permission. State Farm, 182 Ill. 2d at 242. Universal argued
that a test-driver was only “required by law” to be insured if the test-
driver did not have a liability insurance policy. State Farm, 182 Ill. 2d
at 243.
     We held that the omnibus clause contained in section 7–317 of the
Illinois Safety and Family Financial Responsibility Law applies
throughout the Code and thus applies to the mandatory insurance
requirement set forth in section 7–601. State Farm, 182 Ill. 2d at 244-
45. Therefore Luckhart, a permissive user, was required by law to be

                                  -9-
an insured under Universal’s policy. State Farm, 182 Ill. 2d at 245.
Universal also argued that to the extent that its policy covered
Luckhart, the policy only provided excess coverage after other
insurance covering Luckhart was exhausted. We stated that “pursuant
to custom in the insurance industry, primary liability is generally
placed on the insurer of the owner of an automobile rather than on the
insurer of the operator.” State Farm, 182 Ill. 2d at 246.
     In State Farm we were not called upon to determine what level of
omnibus coverage was required to be provided to permissive users of
a car dealer’s automobile. The damages in that case totaled $9,092.15.
Therefore, whether the permissive user of a car dealer’s automobile
was required to be insured at $20,000/$40,000/$15,000 under the
Illinois Safety and Family Financial Responsibility Law or
$100,000/$300,000/$50,000 under the car dealer licensing provisions
of the Code, the car dealer’s insurer was primarily liable for the entire
amount of damages. State Farm argues that this question, left
unresolved in State Farm, was answered in the appellate court
decisions of John Deere Insurance Co. v. Allstate Insurance Co., 298
Ill. App. 3d 371 (1998), Browning v. Plumlee, 316 Ill. App. 3d 738
(2000), and Fuller v. Snyder, 323 Ill. App. 3d 303 (2001).
Additionally, State Farm contends that John Deer, Brownlee, and
Fuller all rejected attempts made by insurers to step-down coverage
in car-dealership cases and that Farmers’ attempt to step-down
coverage should therefore be rejected here.
     In John Deere, Rock River Ford (Rock River) allowed Thomas to
test-drive one of its vehicles. During the test drive, Thomas struck and
injured a pedestrian named Gossett. John Deere, 298 Ill. App. 3d at
373. Thomas was insured under a liability insurance policy issued by
Allstate, which provided excess coverage in the amount of $50,000
per person and $100,000 per occurrence when a nonowned vehicle
was being operated by one of its insured. John Deere, 298 Ill. App. 3d
at 374. Rock River was insured under a garage policy issued by John
Deere in the amount of $500,000. John Deere, 298 Ill. App. 3d at
373. Under the terms of its policy, John Deere attempted to exclude
liability coverage afforded to Rock River’s customers unless (1) the
customer had no other available insurance (whether primary, excess,
or contingent), in which case the customer would be insured but only
up to the compulsory or financial responsibility law limits where the

                                  -10-
covered “auto” is principally garaged, or (2) the customer had other
available insurance (whether primary, excess, or contingent) in an
amount less than the compulsory or financial responsibility law limits
where the covered “auto” is principally garaged, in which case the
customer would be insured only up to the amount by which the
compulsory or financial responsibility law limits exceeded the limits of
their other insurance. John Deere, 298 Ill. App. 3d at 373-74. John
Deere supplied the Illinois Secretary of State with a certificate of
insurance on behalf of Rock River, which indicated that Rock River’s
policy limits were set at $500,000. John Deere, 298 Ill. App. 3d at
373. On appeal, John Deere conceded that our decision in State Farm
required it to provide primary liability insurance to permissive users,
such as Thomas, under the garage policy issued to Rock River.
Therefore, the appellate court was called upon only to decide what
amount of coverage was required by the Code. John Deere, 298 Ill.
App. 3d at 375.
    The appellate court cited section 7–203 of the Illinois Safety and
Family Financial Responsibility Law, which requires minimum limits
of liability insurance for an automobile in the amount of
$20,000/$40,000/$15,000 (625 ILCS 5/7–203 (West 1994)) and
sections 5–101(b)(6) and 5–102(b)(4) (625 ILCS 5/5–101(b)(6),
5–102(b)(4) (West 1994)) from the Code which requires minimum
limits of liability insurance of $100,000/$300,000/$50,000. The court
then stated:
             “A plain reading of these Code sections reveals that the
        legislature intended that the amount of liability insurance
        which must be carried on a particular automobile is not
        determined by the operator of the automobile but, rather, the
        automobile itself. Therefore, the amount of liability insurance
        required by the Code for an automobile should not change
        according to the identity of the person who is driving the
        automobile at the time an accident occurs. [Citations.] To hold
        otherwise would defeat the public policy considerations that
        motivated the enactment of the New and Used Car Dealers
        Licensing Acts ***, because such a holding would illogically
        mandate a higher limit of liability coverage when an
        automobile dealership’s employee is driving the insured
        automobile as an agent of the dealership, yet would not apply

                                 -11-
         to the customer of the dealership permissively test driving the
         same automobile.” (Emphases in original.) John Deere, 298
Ill. App. 3d at 377-78.
The appellate court held that John Deere’s liability under the garage
policy issued to Rock River was at least $100,000/$300,000/$50,000.
However, the court determined that John Deere could not limit its
liability to this amount because it had specifically represented in its
certificate of insurance filed with the Secretary of State that it insured
Rock River under a garage policy which provided $500,000 in
coverage and therefore John Deere was bound by its $500,000 policy
limits as certified to the Secretary of State. John Deere, 298 Ill. App.
3d at 379.
       In Browning, Weeks Pontiac-Chevrolet (Weeks) allowed a
customer named Plumlee to test-drive one of its vehicles. During the
test-drive Plumlee collided with a vehicle driven by Browning.
Plumlee was insured under a policy issued by State Farm. Weeks was
insured under a garage policy issued by Universal Underwriters
(Universal) in the amount of $500,000. Browning, 316 Ill. App. 3d at
739. Under the terms of the garage policy issued to Weeks, Universal
attempted to reduce the liability limits available to permissive users to
the “limit needed to comply with the minimum limits provision law.”
Additionally, Universal attempted to provide only excess coverage in
the event that a permissive user was insured under another insurance
policy. Browning, 316 Ill. App. 3d at 741.
     The appellate court first held that our decision in State Farm and
its decision in Madison Mutual Insurance Co. v. Universal
Underwriters Group, 251 Ill. App. 3d 13 (1993), required Universal
to provide primary coverage to permissive users under the policy
issued to Weeks. Browning, 316 Ill. App. 3d at 743. Next, the court
determined that Universal was required to provide permissive users
under the garage policy issued to Weeks with coverage in the amount
of $500,000 (Browning, 316 Ill. App. 3d at 745) and stated that it was
relying on the reasoning supplied by the court in John Deere, 298 Ill.
App. 3d 371, to resolve the issue of what level of omnibus coverage
is required (Browning, 316 Ill. App. 3d at 744-45).
     In Fuller, Hurley Dodge (Hurley) was repairing a vehicle owned
by a customer named Snyder. Snyder was using Hurley’s loaner
vehicle when he collided with a vehicle being driven by Fuller. Snyder

                                  -12-
was insured under a liability policy issued by Allstate with coverage
in the amount of $100,000/$300,000/$50,000. Hurley was insured
under a garage policy issued by Universal Underwriters (Universal) in
the amount of $500,000. Fuller, 323 Ill. App. 3d at 305. Under the
terms of the garage policy issued to Hurley, Universal attempted to
reduce the liability limits available to permissive users to the “ ‘limit
needed to comply with the minimum limits provision law.’ ”
(Emphasis omitted.) Fuller, 323 Ill. App. 3d at 305-06. Additionally,
Universal attempted to provide only excess coverage in the event that
a permissive user was insured under another insurance policy. Fuller,
323 Ill. App. 3d at 306. The appellate court, relying on our decision
in Smith, held that Universal’s attempt to provide only excess liability
insurance to permissive users insured under another insurance policy
was contrary to public policy and therefore unenforceable. Fuller, 323
Ill. App. 3d at 307. Next, the appellate court held that Universal was
required to provide Snyder with omnibus coverage in the amount of
$100,000/$300,000/$50,000 relying on John Deere, 298 Ill. App. 3d
at 309. The court also found that sections 5–101(b)(6) and
5–102(b)(4) of the Code were specifically applicable to car dealerships
and should control the issue of minimum policy limits. Fuller, 323 Ill.
App. 3d at 308-09. The dissent pointed out that the Code did not
contain an omnibus provision and that the omnibus provision
contained in section 7–317, which applies throughout the Code, only
requires coverage to be provided in the amount of
$20,000/$40,000/$15,000. Fuller, 323 Ill. App. 3d at 309 (Cook, J.,
dissenting).
     State Farm argues that it was not the car dealer provisions that
persuaded the appellate court in John Deere to hold that the insurer
of the car dealer was obligated to provide the full policy limits to
permissive users. It argues that the primary holding of John Deere is
that liability limits follow the vehicle and cannot be changed based on
the operator and that the car dealer provisions involved in John
Deere, Browning and Fuller are irrelevant. In our discussion of John
Deere earlier in this opinion, we quoted at length from that opinion
and mention here only this quote: “To hold otherwise would defeat
the public policy considerations that motivated the enactment of the
New and Used Car Dealers Licensing Acts ***, because such a
holding would illogically mandate a higher limit of liability coverage

                                  -13-
when an automobile dealership’s employee is driving the insured
automobile as an agent of the dealership, yet would not apply to the
customer of the dealership permissively test driving the same
automobile.” (Emphases in original.) John Deere, 298 Ill. App. 3d at
377-78. The Fuller court stated: “Sections 5–101(b)(6) and
5–102(b)(4) should control the issue of minimum policy limits because
those sections are more specifically applicable to car dealerships than
section 7–601.” Fuller, 323 Ill. App. 3d at 308-09. Contrary to State
Farms’ contention, we believe that John Deere, Browning and Fuller
are all based in large part on the car dealer provisions, which are not
involved in this case.
     For the foregoing reason, we hold that neither the statutory
pronouncements of our legislature nor the Illinois decisions relied
upon by State Farm prohibit the step-down provisions in Farmers’
policies. State Farm also argues, however, that Farmers’ step-downs
adversely affect the overwhelming majority of Illinois residents and are
contrary to public policy. The legislature is vested with the power to
enact the laws and if the legislation as enacted “seems to operate in
certain cases unjustly or inappropriately, the appeal must be to the
General Assembly, and not to the court.” People v. Garner, 147 Ill.
2d 467, 476 (1992). We note that the General Assembly recently
passed Senate Bill 1208, which deals with the insurance issue involved
in this case. The Governor signed the bill into law as Public Act
95–395, with an effective date of January 1, 2008. This Act, which
creates new section 143.13a of the Illinois Insurance Code (215 ILCS
5/143.13a), now mandates that “any policy of private passenger
automobile insurance must provide the same limits of *** coverage to
all persons insured under that policy, whether or not an insured person
is a named insured or permissive user under the policy.” As we
observed earlier in this opinion, when the legislature intends different
types of coverage in excess of the minimum statutory requirements
mandated by section 7–203 of the Illinois Safety and Family Financial
Responsibility Law to be the same, it chooses plain, unambiguous
language to indicate its intent. It has now done so, effective January
1, 2008.

                                 -14-
                       Ambiguity and Direct Action
    As noted earlier, Farmers filed a motion to dismiss State Farm’s
complaint, arguing that the step-down provisions contained in its
policies are clear and unambiguous and that the reimbursement sought
by State Farm is an impermissible direct action. The trial court denied
Farmers’ motion to dismiss. On appeal, State Farm moved to strike
the ambiguity and direct action issues from Farmers’ brief. The
appellate court denied State Farm’s motion to strike, holding that the
ambiguity and direct action issues were properly before that court and
it decided these issues.
    State Farm argues that the trial court’s Rule 304(a) (210 Ill. 2d R.
304(a)) finding in its order granting Sates Farm’s motion for partial
summary judgment was limited to the public policy issue and therefore
the appellate court lacked jurisdiction to rule on the ambiguity and
direct action issues. Farmers argues that this court should not
disregard these issues, which were briefed and argued “on summary
judgment.” It is well established that the jurisdiction of appellate
courts is limited to reviewing appeals from final judgments, subject to
statutory or supreme court rule exceptions (In re Marriage of
Verdung, 126 Ill. 2d 542, 553 (1989)), none of which are present in
this case. It is also well settled in this state that a trial court’s denial of
a motion to dismiss is an interlocutory order that is not final and
appealable. Chicago Housing Authority v. Abrams, 409 Ill. 226, 229
(1951). Because the appellate court lacked jurisdiction to review the
ambiguity and direct action issues, those potion`s of the appellate
court’s decision are vacated.

                          CONCLUSION
   For the reasons set forth above, the judgment of the appellate
court is affirmed in part and vacated in part, and the matter is
remanded to trial court for proceedings consistent with this opinion.

                                   Affirmed in part and vacated in part;
                                                       cause remanded.

                                    -15-