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Zipf v. Allstate Insurance Co.

OPINION FILED OCTOBER 21, 1977.

BARBARA M. ZIPF, PLAINTIFF-APPELLANT,

v.

ALLSTATE INSURANCE COMPANY, DEFENDANT-APPELLEE.



APPEAL from the Circuit Court of Cook County; the Hon. EDWARD F. HEALY, Judge, presiding. MR. JUSTICE MEJDA DELIVERED THE OPINION OF THE COURT:

Plaintiff, Barbara Zipf, brought suit against defendant, Allstate Insurance Company, to recover benefits on her personal injury protection insurance contract (commonly called "PIP" or "no fault") entered with Allstate. Plaintiff's motion for summary judgment and her supplemental motion for judgment on the pleadings were denied. Defendant's motion for judgment on the pleadings was granted. Plaintiff appeals.

The issues presented for review are: (1) whether Allstate's obligation to pay plaintiff further benefits under the insurance contract was terminated by plaintiff's recovery of a verdict and judgment against the tortfeasor; and (2) if Allstate's obligation is not so terminated, by what amount, if any, is its obligation reduced by the judgment and the adjudication of its "lien" thereon entered in the tort action.

In her complaint plaintiff alleged that she was insured under the policy issued by Allstate and had complied with all conditions thereunder. The attached policy provided that if the insured was injured in an automobile accident Allstate would pay her "basic personal injury protection." The basic protection included payment for all reasonable medical expenses; and also, if she became totally disabled, income continuation benefits equal to 85 percent of lost income commencing on the date of the accident, subject to a limit of $150 per week for 52 weeks.

The policy also afforded plaintiff "excess personal injury protection" which was subject to depletion of the basic benefits. In addition to all reasonable medical expenses, the excess coverage provided that in the event of total disability Allstate would pay the insured income continuation benefits equal to 85 percent of her lost income, subject to a limit of $150 per week for a maximum of 260 weeks commencing one year after the date of the accident.

Plaintiff's complaint alleged that she was injured in an automobile accident on December 6, 1972, and that she is totally disabled as defined by the policy; that she received benefits from Allstate until January 31, 1975, and that additional benefits and income are due under the policy which Allstate refused to pay. Plaintiff prayed $50,000 damages.

Allstate filed an answer and counterclaim for declaratory judgment in which it admitted that the policy provided basic and excess personal injury protection; that plaintiff was injured in an automobile accident; and that she applied for and received benefits under the policy until January 31, 1975.

However, as an affirmative defense and in its counterclaim, Allstate alleged that its obligation as to both basic and excess coverage is limited by the contract provision that the amount payable thereunder shall be reduced by any amount received by plaintiff from a tortfeasor to the extent that such amount would produce a duplication of payment for any loss covered by the policy.

Allstate also alleged that plaintiff filed suit against the tortfeasor; that she obtained judgment on a verdict for $12,000 which included her medical expenses and loss of earnings; that her damages and injuries were thereby adjudicated; and that the claims of Allstate as intervenor and of plaintiff's attorney for liens upon the judgment were also adjudicated in the tort proceedings on April 17, 1975, as set forth in the attached copy of the order. Allstate alleged that according to the limits of its liability as provided by the contract, plaintiff is not entitled to collect the same wage loss twice, is not entitled to duplicate benefits, and is not entitled to judgment against Allstate in any amount. The counterclaim requested a determination of the rights and liabilities of the parties and a declaration that Allstate was not further obligated by reason of the tort judgment and the policy provisions.

The above order, incorporated by both parties in their pleadings, was entered April 17, 1975, in the tort proceedings pursuant to Allstate's petition to intervene which alleged that it had paid plaintiff $7,627.05 and was entitled to reimbursement under the contract of insurance from the judgment had against the tortfeasor. The order provided that

"the intervening petition and lien of the ALLSTATE INSURANCE COMPANY is adjudicated in the amount of $4,000.00. The lien of [plaintiff's attorney] * * * $4,000.00. The plaintiff BARBARA M. ZIPF shall take $4,000.00. * * *."

No appeal was taken from that order.

Plaintiff filed a motion for summary judgment alleging that she is permanently disabled from her normal occupation, supported by her attached affidavit and an examination report of Allstate's doctor; that the attached order entered on Allstate's intervention determined that $4000 of the $12,000 judgment in tort constituted "a duplication of payment"; that the insurance contract was absolute and not contingent on any recovery from third persons; and that there was no issue of fact or law. Plaintiff requested that the pleadings of Allstate be stricken and dismissed and that judgment be entered in favor against Allstate.

Defendant Allstate filed a reply to the motion for summary judgment that several genuine issues of material facts in regard to the effect of the above order were raised by the pleadings and that the pleadings raise issues concerning the effect of the jury verdict in the tort proceedings on the interpretation of the instant insurance contract.

Thereafter plaintiff filed a supplemental motion for judgment on the pleadings. Defendant Allstate also filed a motion for judgment on the pleadings. The latter motion alleged that the adjudication of Allstate's "lien" in the amount of $4000 indicated a finding by the trial judge that $4000 of Allstate's payment to plaintiff represented a duplication in view of the jury verdict ...


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