Insurance Law

Crowley v. Empire Fire and Marine Insurance Co.

Crowley v. Empire Fire and Marine Insurance Co.
Illinois Appellate Court
Civil Court
Insurance
Citation
Case Number: 
2019 IL App (2d) 180752
Decision Date: 
Tuesday, June 18, 2019
District: 
2d Dist.
Division/County: 
DeKalb Co.
Holding: 
Reversed.
Justice: 
SCHOSTOK

Exclusion in a supplemental insurance policy purchased with rental car, which applied if the insured was under the influence of alcohol or drugs, was not unenforceable as a matter of public policy. No Illinois statute precludes an intoxication exclusion in an excess or supplemental liability policy. Thus, insurer's denial of excess or supplemental coverage to insured based on his violation of the insurance contract does not violate public policy.(BIRKETT and HUTCHINSON, concurring.) 

Direct Auto Insurance Co. v. Bahena

Direct Auto Insurance Co. v. Bahena
Illinois Appellate Court
Civil Court
Insurance
Citation
Case Number: 
2019 IL App (1st) 172918
Decision Date: 
Thursday, June 13, 2019
District: 
1st Dist.
Division/County: 
Cook Co., 4th Div,
Holding: 
Affirmed.
Justice: 
GORDON

Insurer filed declaratory judgment action, seeking a declaration of no coverage because of policyholder's failure to disclose all household residents over age 15, although her policy named as an additional insured the person driving the vehicle which collided with another vehicle. Court granted summary judgment in that case, at insurer's request. Two weeks later, insurer filed another complaint for declaratory judgment, naming policyholder and driver, and passenger in other vehicle, as defendants, asking for declaration that passenger is not entitled to money and that neither other defendant is entitled to indemnification or defense.Court properly denied insurer's motion to dismiss countercomplaint filed by passenger, and properly entered default judgment against insurer at insurer's request. Passenger, as an injured party, has standing and his suit is not premature. Insurer failed to name that passenger as a necessary party to its prior declaratory judgment action, and cannot now use that failure to foreclose passenger's rights to appeal that determination. As insurer could have litigated its claim in the first action but chose not to, its present claim against passenger is barred by res judicata. Insurer failed in its burden to show that passenger was in privity with the parties int he prior action. (McBRIDE and REYES, concurring.)

Lacko v. United of Omaha Life Ins. Co.

Federal 7th Circuit Court
Lacko v. United of Omaha Life Ins. Co.
Civil Court
ERISA
Citation
Case Number: 
No. 18-2155
Decision Date: 
June 12, 2019
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed and remanded

Dist. Ct. erred in granting defendant-plan administrator’s motion for summary judgment in plaintiff-employee’s ERISA action alleging that defendant wrongfully denied her application for short-term and long-term disability insurance benefits based on plaintiff’s claim that she could no longer perform duties of her job or perform material duties of her regular occupation. Defendant labored under conflict of interest, where relevant insurance plans granted defendant discretionary authority to determine benefits and imposed on plaintiff obligation to pay such benefits when due. Moreover, defendant’s denial of said benefits was arbitrary and capricious, where: (1) plaintiff had previously qualified for Social Security Disability benefits; (2) physician who conducted mental residual functional capacity assessment found that plaintiff had understanding and memory limitations that precluded her from performing skilled work; (3) DOT title for plaintiff’s past relevant work and for her regular occupation required that plaintiff perform skilled work; and (4) plaintiff’s inability to perform skilled work qualified her for disability benefits under relevant insurance policies. Also, record lacked any evidence to cast doubt on conclusion made by said physician, and defendant otherwise merely considered only evidence that supported its denial of benefits.

Senate Bill 75

Topic: 
Workplace Transparency Act

(Bush, D-Grayslake; Ann Williams, D-Chicago) prohibits an employer from requiring an employee or prospective employee as a precondition of employment to enter into an agreement or waiver that (1) prevents him or her from disclosing alleged unlawful employment practices, including sexual harassment, discrimination or retaliation; or (2) requires him or her to waive, arbitrate, or otherwise diminish any future claim related to unlawful employment practices. Voids any agreement or waiver to the extent it denies a substantive or procedural right or remedy. 

It does allow the parties to enter into: (1) an agreement or waiver if mutually agreed to and complies with certain disclosure and reporting requirements; and (2) a valid and enforceable confidential settlement agreements related to alleged unlawful employment practices if the parties comply with certain requirements designed to protect the employee and prospective employee. Provides for attorney’s fees and costs for a violation of the Act.

Amends The Human Right Act by defining “harassment” and prohibiting harassment and sexual harassment of nonemployees in the workplace. Holds the employer responsible for harassment or sexual harassment of nonemployees under certain conditions. Amends unlawful discrimination to be what is “actual or perceived” in the context of race, color, religion, national origin, ancestry, age, sex, marital status, order of protection status, disability, military status, sexual orientation, pregnancy, or unfavorable discharge from the military. Expands “working environment” to be outside of the physical location to which an employee is assigned to perform their duties. Creates employer disclosure requirements regarding settlements of such claims. Requires the Illinois Department of Human Rights to develop a model sexual harassment prevention training program and to make it available to employers online at no cost. Every employer must use the model created or develop their own that must be the same or better than the Department’s and train their employees on a yearly basis subject to civil penalties for non-compliance. Provides for additional training and safety measures for employees of restaurants and bars to be available in English and Spanish.   

Amends The Victims’ Economic Security and Safety Act to define “gender violence” and include it as an entitlement for leave from employment that currently includes only domestic violence and sexual violence. 

Passed both chambers. Effective January 1, 2020. 

View Full Text of Legislation

West Bend Mutual Insurance Co v. TRRS Corp.

Illinois Supreme Court PLAs
West Bend Mutual Insurance Co v. TRRS Corp.
Civil Court
Insurance
Citation
PLA issue Date: 
May 22, 2019
Docket Number: 
No. 124690
District: 
2nd Dist.

This case presents question as to whether trial court, in relying on doctrine of primary jurisdiction, properly stayed proceedings pending before Workers’ Compensation Commission (WCC), pending resolution of plaintiff-insurance company’s action pending in trial court seeking declaration that it had no duty to defend or indemnify defendants-insureds in underlying workers’ compensation claim filed by defendants’ employee. Appellate Court, in reversing trial court, found that trial court improperly stayed WCC proceeding, since: (1) reasons for existence of doctrine of primary jurisdiction were not present because there was no need to refer any specialized controversy to WCC; and (2) purposes served by said doctrine would not be aided in instant case, where legislature granted employee expedited process for determination of entitlement to medical services, and where said process would be improperly delayed while employer and insurance provider resolved dispute over payment of said medical services.

Sanders v. Illinois Union Insurance Co.

Illinois Supreme Court PLAs
Sanders v. Illinois Union Insurance Co.
Civil Court
Insurance
Citation
PLA issue Date: 
May 22, 2019
Docket Number: 
No. 124565
District: 
1st Dist.

This case presents question as to whether trial court properly dismissed plaintiff’s claim against defendants-insurance companies, alleging that defendants improperly denied coverage in underlying malicious prosecution claim against plaintiff-insured. Defendants argued, and trial court found, that instant policies did not provide coverage because trigger for coverage under policies was filing of criminal charges against plaintiff in malicious prosecution claim, which occurred prior to defendant’s policies going into effect. Appellate Court, in reversing trial court, found that trigger for coverage under instant policies was when plaintiff in underlying malicious prosecution claim was exonerated of all alleged baseless criminal charges, which took place at time instant policies were in effect. (Dissent filed.)

Hess v. The Estate of Klamm

Illinois Supreme Court PLAs
Hess v. The Estate of Klamm
Civil Court
Insurance
Citation
PLA issue Date: 
May 22, 2019
Docket Number: 
No. 124649
District: 
5th Dist.

This case presents question as to whether trial court properly found that defendant-insurance company had duty to stack four bodily injury liability limits of policy covering four automobiles as result of automobile collision in which defendant’s insured was involved when driving one of said four automobiles. Appellate Court, in modifying trial court’s order, found that under ambiguous language in defendant’s policy, bodily injury limits of liability could be stacked twice, resulting in plaintiffs receiving $200,000 and $600,000 per accident. In its petition for leave to appeal, defendant argued that coverage should only be subject to limit of liability for vehicle involved in accident.

Varlen v. Liberty Mutual Ins. Co.

Federal 7th Circuit Court
Varlen v. Liberty Mutual Ins. Co.
Civil Court
Expert Witness
Citation
Case Number: 
No. 17-3212
Decision Date: 
May 16, 2019
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed

Dist. Ct. did not err in granting defendant-insurance company’s motion for summary judgment in action by plaintiff-insured seeking to compel defendant to indemnify it for expenses associate with clean-up of environmental hazards found on plaintiff’s property. Relevant policy contained exclusion for damage arising out of chemical leaks or discharges, and Dist. Ct. could properly grant defendant’s motion to strike testimony from plaintiff’s expert, who asserted that chemical zones on property were formed by sudden and accidental chemical discharges based on volume of spill, which would make said spills covered under policy. Expert failed to show how his expertise or methodology led to his conclusion that chemical discharges were sudden and accidental. As such, without expert testimony, plaintiff failed to show that instant chemical spills were covered by policy.

Xtreme Protection Services, LLC v. Steadfast Insurance Co.

Xtreme Protection Services, LLC v. Steadfast Insurance Co.
Illinois Appellate Court
Civil Court
Insurance
Citation
Case Number: 
2019 IL App (1st) 181501
Decision Date: 
Friday, May 3, 2019
District: 
1st Dist.
Division/County: 
Cook Co., 6th Div,
Holding: 
Affirmed.
Justice: 
HARRIS

Plaintiff filed complaint alleging assault and intentional infliction of emotional distress alleging that Defendant placed listening devices in his office, attached GPS devices to his vehicles, and sent harassing text messages. Court properly held that Defendant had the right to select an independent attorney to defend it in the underlying action due to a conflict of interest with its insurer. Insurer's explicit waiver of its right to deny coverage for compensatory damages based on acts alleged resolved one type of conflict, but its continuing reservation of its right to deny coverage for punitive damages presents another area of potential conflict, as complaint seeks a substantially greater amount of punitive damages than compensatory damages. Insurer has not shown how it was actually hampered in its defense and thus cannot deny coverage by claiming breach of cooperation clause. (CUNNINGHAM and CONNORS, concurring.)

Tran v. Minnesota Life Ins. Co.

Federal 7th Circuit Court
Tran v. Minnesota Life Ins. Co.
Civil Court
ERISA
Citation
Case Number: 
No. 18-1723
Decision Date: 
April 29, 2019
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed

Dist. Ct. erred in entering judgment in favor of plaintiff-wife of insured in ERISA action alleging that defendant-insurance company had wrongfully failed to pay accidental death and dismemberment benefits, where insured had died while performing autoerotic asphyxiation, which is sexual practice by which insured purposefully restricted blood flow to his brain to induce feeling of euphoria. While Dist. Ct. found that insured’s death qualified as accidental death that did not result from intentionally self-inflicted injury, Ct. of Appeals found autoerotic asphyxiation qualified as intentional self-inflicted injury that precluded coverage under relevant accidental death and dismemberment policy riders. (Dissent filed.)