Justia Illinois Supreme Court Opinion Summaries

Lay, a real estate company, hired a business to send advertising faxes on its behalf by “blast fax,” which sends advertisements to thousands of fax machines cheaply. As a result, Lay became the defendant in a class action filed by Locklear under the Telephone Consumer Protection Act. The matter settled. A monetary judgment was entered against Lay to be paid only from Lay’s insurance policies. The Act in question provides for $500 in damages for each violation, and, with a putative class of 3,478 in the underlying action, the total damage amount reached $1,737,500, plus costs. Lay’s insurer, Standard, successfully sought a declaration of noncoverage. The appellate court affirmed, reasoning that the damage provision of the Act allows for punitive damages, which are uninsurable under Illinois law as a matter of public policy. The Illinois Supreme Court remanded, reasoning that the Act is a remedial statute, even though it provides for $500 in liquidated damages per violation. The ban on insurability does not apply.View "Standard Mut. Ins. Co. v. Lay" on Justia Law

A 2009 collision on a rural Effingham County highway resulted in the death of a man, 18 years old and not intoxicated. The other driver was a 60-year-old man who was intoxicated and had been drinking in Johnny’s Bar and Grill. The decedent’s parents, who had already obtained $106,550 in insurance recoveries, sued under the Dramshop Act, which has a statutory cap on recovery of $130,338.51. The bar owner had insurance for that amount, but his insurer became insolvent and was liquidated. The Illinois Insurance Guaranty Fund assumed his defense. The Fund statute provides that the Fund’s obligation shall be reduced by a plaintiff’s other insurance recoveries. The plaintiffs argued that, if the jury award were far in excess of the statutory cap, the setoff could first be applied to the award, and the award could then be brought down to allow them to recover the full amount of the statutory cap itself. The appellate court ruled that the reduction should be applied to the jury’s verdict. The Illinois Supreme Court reversed. The Fund is liable only up $130,338.51. The setoff for insurance proceeds should be applied against that maximum liability. The availability of a jury trial is not relevant and the amount of a verdict cannot expand the Fund’s obligation. View "Rogers v. Imeri" on Justia Law

When an insurance company authorized to transact business in Illinois becomes insolvent and unable to pay claims, the Illinois Insurance Guaranty Fund pays those claims after an order is entered liquidating the company, 215 ILCS 5/532. A cap on individual claims is inapplicable to workers compensation claims under the Workers’ Compensation Act, 820 ILCS 305/1. The plaintiff is the successor to Wells, a manufacturer. A Wells employee was seriously injured on the job in 1985, and, in 1993, the Industrial Commission ordered weekly lifetime benefits for total, permanent disability. Wells began to make the payments directly to the employee. Wells was self-insured, but had excess insurance from Home Insurance. After Wells’ payments to the injured employee reached $200,000, Home paid benefits until Home became insolvent in 2003 and was liquidated. The Illinois Insurance Guaranty Fund took over Home’s obligations, but stopped paying the employee in 2005, arguing that payments to an excess, rather than a primary, insurer were not payments of “workers’ compensation claims” exempted from the cap. Wells continued paying the employee and sought a declaration that the Fund’s payments should continue. The circuit court agreed with Wells, awarding summary judgment, and the appellate court affirmed. The Illinois Supreme Court affirmed, rejecting the distinctions made by the Fund between excess and primary coverage and between payments made directly or indirectly to employees. View "Skokie Castings, Inc. v. IL Ins. Guar. Fund" on Justia Law

An Illinois driver alleged that she was injured in an accident with an uninsured motorist in Wisconsin in 2007. In Illinois proceedings her insurer, Country Preferred, sought a declaration of noncoverage and she unsuccessfully moved to compel arbitration. Uninsured motorist coverage was part of the policy, but the policy also provided that “any suit, action or arbitration will be barred unless commenced within two years from the date of the accident.” The insurer contended that the driver had not met this requirement, and the circuit court agreed. The appellate court reversed, persuaded by the driver’s theory that public policy was violated by virtue of the fact that the applicable statute of limitations in Wisconsin is three years, unlike Illinois (and the policy), where it is two years. The Illinois Supreme Court reversed, noting that the insured never initiated any type of legal action to settle her claim within the policy’s applicable time frame. There is no public policy violation in requiring the insured driver to bring her suit, action, or arbitration request within two years, the same time period as the Illinois statute of limitations, even though the limitation period in Wisconsin, the state where the accident occurred, is longer.View "Country Preferred Ins. Co. v. Whitehead" on Justia Law

Firefighters, who suffered career-ending injuries during required training exercises, obtained line-of-duty disability pensions and sought continuing health coverage under the Public Safety Employee Benefits Act, 820 ILCS 320/10, which requires employers of full-time firefighters to pay health insurance premiums for the firefighter and family if the firefighter suffers a catastrophic injury as a result of a response to what is reasonably believed to be an emergency. The trial court dismissed a declaratory judgment action by one firefighter and affirmed denial of the insurance benefit for one firefighter. The appellate court affirmed. The supreme court held that an "emergency" means an unforeseen circumstance calling for urgent and immediate action and can arise in a training exercise. The other firefighter had obtained a declaratory judgment, which was affirmed by the appellate court. The supreme court distinguished the situation because, although he was instructed to "respond as if it were an actual emergency," he was not injured while making an urgent response to unforeseen circumstances involving an imminent danger to person or property. View "Gaffney v. Bd. of Tr. of Orland Fire Prot. Dist." on Justia Law

Phoenix Insurance Company ("Phoenix") filed a complaint in circuit court rejecting the arbitration award given to appellee when she requested coverage under the underinsured-motorist provisions of her policy with Phoenix after she was injured in a car accident and the other driver's vehicle was underinsured. At issue was whether a provision allowing either party to an insurance contract to demand a trial de novo following arbitration was unenforceable when it appeared in an underinsured-motorist policy. The court held that the provision in appellee's underinsured-motorist policy allowing either party to reject an award over the statutory minimum for liability coverage did not violate public policy and was not unconscionable.