Illinois law provides for losses suffered when an Illinois insurance company goes bankrupt, is liquidated or cannot meets its obligations. The Illinois Insurance Guarantee Fund is available to step in when an insurance company fails.
In this case, the Illinois Supreme Court reversed and remanded a decision written by the Fifth District Appellate Court in the case of Roy Dean Rogers II. Rogers, age 18, was struck by a car driven by John Winterrowd in 2009. Roy died as a result of this incident and his injuries.
Winterrowd was intoxicated at the time. Rogers’s parents received in settlement two insurance payouts. One was for $26,550 from Winterrowd’s insurance company and another $80,000 was received from the Rogers’s own automobile insurance company.
Rogers’s family then filed a lawsuit against Gani Imeri, who was the owner of a bar where Winterrowd had been drinking alcohol before the accident.
Under the Illinois Dramshop Act, Rogers’s parents sought compensation for their son’s personal injury, his death and their loss of society.
When the incident that killed Roy Dean Rogers occurred, Imeri had a dram shop liability policy with Constitutional Casualty Co. It provided a limit of $130,338.51, which was the statutory cap for lawsuits under the Illinois Dramshop Act. However, while the case was being litigated, Constitutional Casualty Co. went bankrupt and was liquidated.
Imeri’s defense was assumed by the Illinois Insurance Guarantee Fund. In response to the Rogers’s lawsuit, Imeri moved to limit his maximum liability to $23,788.51, the difference between the statutory dram shop limit and the money already recovered by the Rogers family from the other insurance carriers.
The Rogers family responded stating that the time for such a motion should be after the jury’s verdict, not before, as it “intrudes on the jury’s role as finder of fact.” The trial judge agreed, finding that Imeri’s motion was premature.
Imeri moved to certify a question for appellate court review, asking whether the reduction for “other insurance” recoveries applied to the jury’s verdict or to the defendant’s maximum potential liability. Imeri was worried that the jury, seeing a maximum of $130,338.51 by way of the Illinois Dramshop Act, could assign a small portion of that amount if they felt that Imeri was not entirely at fault and Imeri would end up paying the entire amount of $23,788.51 that could be levied.
On the other hand, if the jury were told that $23,788.51 was the maximum amount of recovery and they found that Imeri was not entirely liable, they might assign only a portion of that amount to be paid.
The Illinois Appellate Court found that the reduction should only be applied against the verdict, rather than being applied before the jury verdict. Imeri appealed to the Illinois Supreme Court.
The Illinois Supreme Court disagreed with the appellate court finding that “to the extent that the funds’ obligations is reduced by [money recovered from other insurance policies], the liability of the person insured by the insolvent insurer’s policy for the claim shall be reduced in the same amount.”
This means that the Rogers family was required to exhaust all solvent insurance policies before it could receive money from the Illinois Insurance Guarantee Fund and that the funds’ liability should be reduced to reflect the other money the family recovered.
The Illinois Supreme Court cited precedent that the defendant in such a case is legally liable only up to the maximum possible recovery under the Act.
The role of the jury was not, in the eyes of the court, relevant to this particular determination. Accordingly, the Supreme Court reversed the decision of the appellate court and remanded the case to the trial judge for further proceedings consistent with the court’s decision.
Roy Dean Rogers II, et al. v. Gani Imeri, No. 2013 IL 115860 (Nov. 21, 2013).
Kreisman Law Offices has been handling automobile accident cases, truck accident cases, nursing home abuse cases, work injuries and wrongful death actions for individuals and families who have been harmed, injured or died as a result of the carelessness or negligence of another for more than 38 years in and around Chicago, Cook County and its surrounding areas, including Hinsdale, Oak Lawn, Morton Grove, Des Plaines, River Grove, Inverness, Flossmoor, Palatine and Hazel Crest, Ill.
Related blog posts:
Insurance Company’s Restrictive Endorsement Did Not Limit Coverage in Accident; Indiana Insurance Co. v. Royce Realty
Illinois Appellate Court Finds That Duty to Defend an Additional Insured May Be Based on Pleadings and Other Documents