Category Archives: Statutory Interpretation

Rogers v. Imeri – Illinois Supreme Court Resolves Split in Circuits over How to Apply Set-Off’s When the Guaranty Fund Defends a Dram Shop Defendant

Rogers v. Imeri, 2013 IL 115860 (Theis)

Facts:  Plaintiff’s decedent was killed in a head-on motor vehicle collision with an intoxicated driver. The Estate had two available claims, the automobile negligence claim against the driver and a dram shop claim against the bar that served him alcohol.  The dram shop claim included claims for injury and loss of society thereby making $130,335.51 the total statutory amount available to the plaintiff under the Dram Shop Act.  The Estate obtained $26,550 from the driver’s insurance policy and an additional $80,000 in underinsured coverage from its own policy.  The insurer for the dram shop defendant was insolvent and so the Illinois Insurance Guaranty Fund was defending the case.  It sought a ruling from the trial court that pursuant to section 546(a) of the Illinois Insurance Guaranty Fund Act the $106,550 recovered by the plaintiff should be set off as “other insurance” from the $130,335.51 statutory cap amount such that the total recoverable to the plaintiff would be only $23,788.51.  The plaintiff argued that the “other insurance” set off should not be applied until after a jury verdict.  The trial court agreed with the plaintiff and ruled that the request was pre-mature and set-offs would be determined after a jury determined the total damages, however, it approved a 308 certified question which was accepted and affirmed by the appellate court.  The defendant petitioned the Illinois Supreme Court for review which due to a split in authority between the First District and Fifth District was accepted.

Holding:  When the Illinois Insurance Guaranty Fund is defending a claim under the Dram Shop Act, the set-off from other insurance are reduced from the total available limits under the Dram Shop Act, not from the verdict.

Filed in Trial Book Under:  Dram Shop Act, Illinois Insurance Guaranty Fund, Statutory Interpretation, Set-Offs

Commentary:  Add this decision to the long list of reasons that Dram Shop cases are generally unappealing for plaintiffs.  Under the approach adopted by the plaintiff, and followed by the 5th District, the plaintiff would be able to try the case to a verdict and if the result were say $500,000, the $106,550 in other insurance would then be applied to that total, and the Guaranty Fund would be required to underwrite the entire statutory limit under the Dram Shop because the verdict was much higher than the “other insurance” set-off.  Instead, they are left with only $23,788.51 in coverage because the court is to apply the other insurance to the statutory limits of the Dram Shop Act first.  I certainly understand the logic of the plaintiff and the Fifth District here, and wish that the Supreme Court had followed it, but at the end of the day the statutory purpose of the Guaranty Fund is to be an insurer of last resort and not to make the plaintiff whole, or “more whole” in this particular case.

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Filed under Dram Shop, Insurance Coverage, Statutory Interpretation

Stanton v. Rea – 5th District Holds That Health Care Liens Pro-Rata Share of Recovery Should Be Calculated After Reduction of Attorneys Fees and Costs

Stanton v. Rea, 5-11-0187 (Goldenhersh)

Facts:  Plaintiff was injured in a car collision and incurred medical bills relating to her treatment.  She was uninsured so the bills were unpaid and her healthcare providers filed liens on the proceeds of the lawsuit.  The case proceeded to trial and the plaintiff was awarded $13,506.80, plus $3,919.79 in costs.  Plaintiff was then required to file a citation action in order to get the defendant’s insurance carrier to pay the judgment, thereby incurring additional expenses totaling $4,501.44.  Plaintiff filed a petition to adjudicate the liens asserted by the healthcare providers.  Pursuant to the provisions of the Health Care Services Lien Act, 770 ILCS 23/1 to 999 (West 2008), Plaintiff’s counsel reduced the fees to 30%.  The trial court divided the funds among attorneys fees, expenses, and lien payments, applying 40% of the amount of the verdict to the payment of medical liens, such that 5 providers accounted for $5,806.02.  Given the amount of costs expended, the plaintiff received nothing from the verdict.  Plaintiff argued that the trial court should have subtracted the expenses from the judgment before applying the formula from the lien act to determine the health care providers 40%.  The trial court rejected the argument and Plaintiff appealed.

Holding:  The trial court should have begun its calculations of 40% for the lienholders after payment of attorneys fees and costs necessary in securing the judgment.

Filed In Trial Book Under:  Liens; Statutory Interpretation

Commentary:  The holding in this case is certainly helpful to plaintiffs in difficult cases where the medical liens exceed 40% of the total verdict or settlement.  Sadly, this can occur quite often, particularly when there is limited insurance coverage.  To reach this conclusion, the appellate court focused on the general principles of statutory interpretation to conclude that the legislature intended that the plaintiff actually receive 30% of the total settlement in hand after payment of the attorneys lien and health care liens.  In order to insure this, the trial court should have begun its 40% calculations after the payment of attorneys fees and costs.  It’s interesting that the opinion argues that attorneys fees should be based upon the full amount of the verdict, but that the health care providers should be based on an amount that is calculated after the expenses and the attorneys fees.  The rationale for this part of the holding is that health care providers have an advantage over the attorneys in that they have right to pursue the balance of the bills after the lien adjudication, which the attorneys do not.  I certainly hope that this case stands up to scrutiny from other courts, but unfortunately it seems as if the 5th District Appellate Court is selectively reading the statute to benefit the interests of the plaintiff and the plaintiff’s attorneys over the health care providers.  Just running the numbers from this case in the method suggested by the opinion, it ends up that the attorneys statutory 30% ends up significantly higher than the plaintiff’s 30% and the health care lien holders 40%.  I question whether the statute was really meant to be read this way because the Act seems to go to great lengths to allocate the recovery between the three interested parties – plaintiffs, attorneys and health care providers – so that when everyone is accounted for they all add up to 100%; whereas this opinion calls for a much different calculation that in my opinion seems to fall apart when applying the math.  For that reason, I doubt that it will be adopted by other trial courts or appellate districts.  I hope that I’m wrong and am missing something here.  We’ll have to wait and see.

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Filed under Liens, Statutory Interpretation

Harris v.Thompson – Illinois Supreme Court Finds That Public Ambulance Driver is Immune from Negligence Count Despite Conflict Between Tort Immunity Act and Illinois Vehicle Code, Overruling 5th District Bradshaw Case

Thompson v. Harris, 2012 IL 112525 (Freeman)

Facts:  Plaintiff is injured in a collision with an ambulance that was transporting a patient from a nursing home to a hospital when the ambulance went through a controlled intersection against his signal.  The defendant claims that he had his lights on and slowed to 10 mph and blasted the siren a few times before entering the intersection.  Plaintiff claimed that he was going at least 40 mph at the time of the collision.  Plaintiff plead both a negligence count and a willful and wanton count against the driver and his employer, Massac County Hospital District, a public agency.  The defendant’s motion to dismiss the negligence count pursuant to section 10-101 of the Tort Immunity Act was denied by the trial court.  At the trial, the trial court directed a verdict on the issue of willdul and wanton but permitted the negligence count to proceed to the jury.  The jury found in favor of the plaintiff and awarded $665,000 in damages.  The defendant appealed the verdict arguing that the Tort Immunity Act barred any claim against the ambulance driver for negligence.  Relying upon the Fifth District case of Bradshaw v. City of Metropolis, 293 Ill.App.3d 389 (1997), whic held that the Illinois Vehicle Code and Tort Immunity Acts were in conflict and that the Illinois Vehicle Code, which imposes a duty on an emergency vehicle to refrain from negligence, serves to abrogate the Tort Immunity Act, the Fifth District appellate court affirmed the verdict.  The Defendant appealed to the Illinois Supreme Court.

Holding:  (1) The Illinois Vehicle Code does not abrogate the Tort Immunity Act and the driver of a public ambulance is not liable for negligence, only willful and wanton conduct, (2) the holding in this case applies both retroactively and prospectively, and (3) there was insufficient evidence to sustain an allegation of willful and wanton conduct against the driver of the ambulance and the trial court’s directed verdict on that issue was proper.

Filed In Trial Book Under:  Tort Immunity – Emergency Call; Willful and Wanton Conduct; Statutory Interpretation; Directed Verdict

Commentary:  Personally, I agree with the Kilbride dissent in this case and feel that the Bradshaw case was sound.  However, with that said, the Bradshaw case was an anomaly and none of the other districts followed its reasoning, so it’s not too surprising to see the Supreme Court step in and eliminate any confusion from this outlier case.  Referencing the prior Supreme Court opinions, Henrich v. Libertyville High School, 186 Ill.2d 381 (1998), the court states:

“A court must construe statutes relating to the same subject matter with reference to one another so as to give effect to the provisions of each, if reasonable. Henrich, 186 Ill. 2d at 391-92. Sections 11-205 and 11-907 of the Vehicle Code provide certain privileges both to public and private employees who operate emergency vehicles. In contrast, the Tort Immunity Act does not apply to private employees, but provides immunity only to public employees absent willful and wanton conduct. Therefore, these sections of the Vehicle Code do not abrogate the Tort Immunity Act. See Sanders, 306 Ill. App. 3d at 363; Carter, 304 Ill. App. 3d at 450. Under the plain language of section 5-106 of the Tort Immunity Act, the legislature has chosen to grant immunity from negligence liability to public employees like Thompson. See Young, 308 Ill. App. 3d at 560. For the foregoing reasons, Bradshaw v. City of Metropolis, 293 Ill. App. 3d 389 (1997), is hereby overruled.”

The reasoning for the second holding, to apply the case both retroactively and prospectively is sound.  The first prong of the three-factor analysis adopted from Chevron Oil v. Huson, 404 U.S. 97, 106-107 (1971), see Aleckson v. Village of Round Lake park, 176 Ill.2d 82, 87-91 (1997), requires that the decision must establish a new rule of law, either by overruling clear past precedent on which litigants have relied, or by deciding an issue of first impression where the resolution was not clearly foreshadowed.  This case simply doesn’t meet the first requirement.  As an attorney practicing primarily in the First District, where Sanders v. City of Chicago, 306 Ill.App.3d 356 (1999) rejected the Bradshaw logic in 1999, it seems as if the Fifth District had it good for a long time.  As the opinion states, “Bradshaw was hardly clear precedent.”

The third holding on willful and wanton conduct was a bit disappointing, given the de novo analysis.  The court is supposed to view the evidence in the light most favorable to the plaintiff.  In this case, the defendant claimed that he entered the intersection at 10 mph with his lights on and “blasted” his siren from 100 feet away prior to entering the intersection.  The plaintiff, on the other hand, did not testify to hearing the siren or seeing the lights and testified that the ambulance was traveling approximately 40 mph.  A vehicle going 40 mph would travel 60 feet per second, and be in the intersection less than 1.5 seconds from the alleged “blasting of the siren”, which is less time than a reasonable driver would have to react and stop if they were traveling the speed limit towards the intersection.  There is a lot of conflict between this testimony.  In short, I feel that entering an urban intersection at 40 mph against the traffic control device, particularly when there was the visual obstruction that made the intersection blind as explained by the ambulance driver, is certainly beyond mere negligence and reaches a reckless disregard for the safety of others.  The fact that this case could be manipulated in the future to argue that this conduct is appropriate as a matter of law is potentially troublesome.

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Filed under Statutory Interpretation, Tort Immunity, Willful & Wanton