Insurance Law

Dist. Ct. did not err in granting defendant-insurance company's motion for summary judgment in plaintiff-insured's action alleging that defendant had failed to pay expenses covered by insurance policy for damages associated with two incidents in which tree fell on plaintiff's home and eventually rendered said home uninhabitable. While plaintiff alleged that defendant breached contract by failing to pay $37,575 for roof reconstruction, $2,580 for damages to home's siding, and unspecified amount for additional living expenses, no breach occurred, where policy required that plaintiff actually incur said expenses and then seek recovery from defendant, and plaintiff had not paid said expenses prior to seeking recovery of same from defendant. Also, with respect to plaintiff's claim for additional living expenses, record showed that plaintiff had not yet submitted said expenses to defendant, and thus plaintiff could not establish any wrongful denial of said expenses. Moreover, record showed that defendant had paid applicable limit under insurance policy.

Dist. Ct. erred in granting plaintiff-insured's motion for summary judgment in action for extracontractual damages under section 155 of Illinois Insurance Code, based on defendant-insurance company's failure to defend plaintiff in underlying action, as well as defendant's failure to pay plaintiff for over one year for fees and expenses awarded to it in underlying action, after state court had found that defendant had duty to defend plaintiff in underlying action that had been ultimately settled by plaintiff in 2013 for zero dollars in exchange for plaintiff's promise not to sell alleged copy-cat products. Record showed that Illinois Appellate Court found in 2015 that defendant was liable under its policy to defend plaintiff in underlying action and further awarded plaintiff damages in 2017 that were payable under defendant's policy. Moreover, section 155 allowed insured to seek extracontractual damages from insurer only under circumstances where: (1) insurer's liability under policy was undecided; (2) amount of loss payable under policy was undecided; or (3) there was unreasonable delay in settling underlying claim. Plaintiff, though, did not satisfy any of these prerequisites, since: (1) defendant's liability and damages under said policy had already been resolved by 2013 settlement, as well as Illinois Appellate Court judgments in 2015 and 2017; and (2) plaintiff did not seek recovery based on delay in settling underlying lawsuit against plaintiff, but rather delay in defendant's failure to pay Illinois court's judgment relating to fees and expenses associated with underlying claim.

Dist. Ct. did not err in dismissing for lack of standing plaintiffs' action seeking to collect on healthcare receivables assigned to them by Medicare Advantage Organization (MAO), where plaintiff alleged that defendant, as primary insurer, failed to pay for medical expenses covered by insurance policy under circumstances, where MAO, as secondary insurer, had made conditional payments on behalf of defendant. While Medicare Act recognized existence of plaintiffs' potential cause of action against defendant, instant plaintiffs lacked standing to bring instant action, where, after discovery had taken place, plaintiffs had failed to identify within their basket of receivables, example of concrete and definite amount owed to them by defendant. Ct. rejected plaintiffs' claim that allegation of mere existence of assignment to them to collect potentially un-reimbursed payments was sufficient to establish standing. Moreover, record did not support plaintiffs' citation to single claim within said basket of receivables where defendant owed them money, where payments made by MAO were for knee injury that did not arise out of car accident that was covered under defendant's insurance policy, and thus said payments for treatment given to insured's knee were not made on behalf of defendant for purposes of Medicare Act. Ct. also disapproved of plaintiffs' apparent tactic of filing instant lawsuit in hope that discovery would find existence of viable claim, rather than performing some due diligence to find existence of viable claim prior to filing instant lawsuit.

Dist. Ct. did not err in granting judgment on pleadings in favor of defendant-insurance company in plaintiff-insured's action alleging that defendant breached insurance contract by failing to defend plaintiff in underlying lawsuit alleging that plaintiff sent unsolicited fax advertisements in violation of Telephone Consumer Protection Act (TCPA), as well as Illinois Consumer Fraud and Deceptive Practices Act, and that plaintiff's conduct constituted common-law conversion, nuisance and trespass. Instant policy barred coverage for any claims "arising out of TCPA" or any similar regulatory or statutory law. Both parties agreed that exclusion barred plaintiff's TCPA and other statutory claims. Also, Ct. of Appeals found that policy exclusion extended to plaintiff's common-law claims, where conduct associated with instant common-law claims arose out of same conduct associated with plaintiff's TCPA-related claims.

In action by plaintiff-insurance company, alleging that defendant-insurance company breached insurance contract after defendant refused to indemnify plaintiff for payment plaintiff made to settle claim that plaintiff had wrongfully failed to settle underlying insurance action against plaintiff's insured, Dist. Ct. properly found that instant policy provided coverage for plaintiff's claim, even though jury found in underlying action that plaintiff never committed "wrongful act." Record showed that plaintiff gave defendant written notice within timeframe covered by policy of potential claim that plaintiff had failed to properly settle underlying action, and policy provided that any claim that was subsequently made against plaintiff arising out of said notice was treated as claim that was made within timeframe of policy. Also, Ct. rejected defendant's contention that jury's finding in underlying action that plaintiff did not commit wrongful act should have resulted in finding that plaintiff was unable to invoke coverage under policy in first place, where: (1) defendant's interpretation of policy would require plaintiff to prove existence of its wrongful act in order to invoke coverage; and (2) if plaintiff was successful in this regard, exclusion in policy would preclude coverage because of existence of plaintiff's wrongful act.