Appeal from the Circuit Court of Winnebago County, Seventeenth
Judicial Circuit; the Hon. ALBERT S. O'SULLIVAN, Judge,
presiding. Judgment affirmed.
MR. PRESIDING JUSTICE DAVIS DELIVERED THE OPINION OF THE COURT.
Plaintiff, Government Employees Insurance Company (herein called GEICO) brought this suit seeking a declaratory judgment that an automobile insurance policy issued by it was null and void from its inception. Saweren J. Dennis, the insured, Patricia Gilbertson, the driver of the insured car, and Marjorie Maffei and Joni Lynn Short, two persons injured while riding with Patricia Gilbertson, all were joined as defendants in the action. A jury returned a verdict finding the issues for the defendants, the trial court entered judgment for the plaintiff notwithstanding such verdict and the defendants have appealed.
This case was previously before this court and our opinion was reported in 65 Ill. App.2d 365, 212 N.E.2d 759 (1965). The first trial was before the court, without a jury. On appeal, we reversed and remanded the judgment of the trial court against the plaintiff, GEICO, with directions for a new trial in accordance with the views therein expressed. We will summarize the factual background reported in our earlier decision and the additional matters brought out or occurring subsequent to our first decision. The basis of GEICO's complaint to have its insurance policy declared void is, in part, the misrepresentation and concealment of material facts.
Dennis made an application to GEICO for insurance on two cars, the title thereto being in his name. In his application, he stated that his fiancee, Mrs. Patricia Gilbertson, (herein called Gilbertson), would drive one of the cars a 1956 Pontiac ninety-five per cent of the time. The policy was issued on August 27, 1962, and the declaration stating that Dennis was the owner of the 1956 Pontiac, was made a part of the policy.
Within a few days after issuing the policy, GEICO sent a questionnaire to Dennis to be completed by Gilbertson. In this questionnaire she stated that no insurance company had "refused, cancelled or refused to renew any automobile insurance" for her. However, the evidence conclusively established that in 1960 Gilbertson owned a Ford which was involved in an accident when, ironically, her 1957 Ford was being driven by the same Marjorie Maffei who is one of the defendants in this action. At that time, no liability insurance was carried on the Ford car. Thereafter, Gilbertson sought such insurance coverage. She was refused insurance by one company, and was told by another that a policy would issue, but only through an assigned risk plan, which she did not accept. Subsequently, she bought the Pontiac in question, which she admittedly owned, although the title thereto was in Dennis. As to her answer on the questionnaire that she had not been refused any insurance, she stated that she had forgotten all about the other insurance company refusals.
Within a month after the issuance of the policy, Gilbertson was driving the Pontiac and was involved in an accident in which her passengers, the defendants, Maffei and Short, were injured. Marjorie Maffei is the defendant who is prosecuting this appeal. She raises three issues for review:
(1) Was she denied a vested property right in the insurance policy without due process of law in violation of her constitutional rights?
(2) Were the provisions of section 154 of Article IX of the Insurance Code (Ill Rev Stats 1965, c 73, par 766) interpreted by this court so as to deny her of her constitutional rights?
(3) Did the trial court err in depriving her of the findings of a jury and in making certain rulings on the evidence and law?
The major portion of defendants' brief is devoted to the contention that the plaintiff should not be permitted to rescind or have its policy declared null and void after the date of the accident because to do so would deprive Maffei of vested property rights without due process of law. She attempts to draw a number of analogies to justify this position, admitting that she has found no case directly supporting her contention, but arguing that we should depart from the law as it presently is to protect her constitutional rights.
We do not believe this argument merits extended discussion. The defendants first appealed to the Supreme Court alleging these constitutional issues as grounds for the appeal to that Court. In transferring the case to this court, the Supreme Court said:
"This case is here on direct appeal from the trial court from a declaratory judgment order holding that the plaintiff insurance company was not obligated under an automobile liability insurance policy. The person who was injured in the automobile accident was a party to the suit and participated therein. She contends that upon her being injured she acquired a vested interest under the policy and that the company could not escape liability because of any policy defense which it might have against the policy holder. She argues that the ruling of the trial court deprived her of due process of law. There was no lack of procedural due process for she had an opportunity to participate in the suit. The question of whether the trial court's judgment was correct presents only a question of error and not a substantial constitutional question. On the Court's own motion the cause is transferred to the Appellate Court for the Second District."
[1-3] We agree that automobile public liability insurance assumes an importance to the general public beyond that normally found in private contracts. Because the general public could be subjected to possible injury through the operation of the car in question, its members may be treated as third-party beneficiaries. They possess a sufficient interest in the procurement and coverage under such policies to be classified as a real party in interest in an insurance contract. Simmon v. Iowa Mut. Cas. Co., 3 Ill.2d 318, 322, 324, 121 N.E.2d 509 (1954); Gothberg v. Nemerovski, 58 Ill. App.2d 372, 385-387 incl., 208 N.E.2d 12 (1965). This, however, does not afford an injured person any rights greater than those actually resulting from the policy itself. As a third-party beneficiary, such a third person's rights must stand or fall on the contract itself. The GEICO policy recognized this right. It, like the policy in the Gothberg case, provided that any person who had secured a judgment against the insured could recover under the policy "to the extent of the insurance afforded by the policy."
Defendant Maffei can only recover against GEICO to the extent that insurance was afforded under the policy in question. If, in fact, that policy was null and void because of material misrepresentations, then she could make no recovery against GEICO. As the Supreme Court pointed out, she has had an opportunity to participate in the trial and, in fact, did so. She was not denied any procedural due process. She was ...