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Shockley v. Ryder Truck Rental





APPEAL from the Circuit Court of Cook County; the Hon. ALLEN HARTMAN, Judge, presiding.


Plaintiffs, C.D. Shockley and Emily Shockley, filed an amended complaint on March 7, 1978, against defendants, Ryder Truck Rental, Inc., Azar Nut Company and James Schultz, alleging that on December 29, 1975, defendants Ryder Truck Rental, Inc. (Ryder) and Azar Nut Company (Azar Nut), by their agent and servant, Lawrence Hogsed, negligently drove a truck into the rear of plaintiffs' car. Plaintiffs also alleged in a separate count that later on the same day they were involved in a second accident in which defendant James Schultz negligently drove his car into the rear of their car. Ryder subsequently moved for summary judgment and Azar Nut moved to dismiss as to it. Both motions were granted and plaintiffs appeal. Plaintiffs' cause of action against Schultz is not before us on this appeal.

On December 29, 1975, plaintiffs were involved in an accident with a semi-trailer truck driven by Lawrence Hogsed. This truck bore the name "Ryder Truck Rental, Inc." On March 23, 1977, plaintiffs' attorney sent a notice of lien and a cover letter to Ryder. Shortly thereafter, plaintiffs' attorney received a letter dated April 4, 1977, from Associated Claims Service, Inc. (Associated Claims), signed by John S. Tasch. The letter was captioned:

"RE: C.D. Shockley and Emily Shockley vs. Ryder Truck Rental, Inc. and Lawrence Hogsed Accident: 12-29-75 Our File No.: A512-7919-M"

In this letter Tasch informed plaintiffs' attorney that Ryder "is self-insured" and that Associated Claims was Ryder's "Chicago Claims Representatives." Tasch further advised plaintiffs' attorney that Associated Claims acknowledged plaintiffs' letter and lien and interest and concluded, "[w]e will be glad to talk to you about this matter at your convenience."

On April 7, 1977, plaintiffs' attorney wrote to John Tasch. In the caption, plaintiffs' attorney referred to Ryder as Associated Claims' "insured" and to James Schultz as Allstate's "insured." In the letter plaintiffs' attorney stated that on December 29, 1975, plaintiffs' car had first been struck by a Ryder semi-trailer driven by Lawrence Hogsed, and later was struck by a car driven by James Schultz, and included a list of the medical and repair bills incurred by the Shockleys as a result of the two accidents. Plaintiffs' attorney also suggested that before plaintiffs filed suit against Associated Claims' "insureds," an attempt to settle should be made regardless of any difficulty in apportioning liability for the damages.

On June 14, 1977, Tasch wrote plaintiffs' attorney. This letter was captioned:

"RE: Shockley -vs- Schultz and Ryder Truck Rental Accidents: 12-29-75 Our File: A512-7919-M"

In the letter Tasch asked for advice concerning the possibility of settlement at a previously agreed figure of $6,000, $3,000 of which was to come from Ryder and $3,000 from Allstate on behalf of Schultz. Tasch in this letter further stated, "I would certainly hate to become involved in litigation solely because Allstate has refused to accept a reasonable or realistic attitude. If they are not in agreement, I would like to ask that you consider going back to the original agreement we had between us and permit us to avoid what we consider to be unnecessary litigation."

Plaintiffs failed to reach a settlement and filed suit on December 16, 1977, naming Ryder and Schultz as defendants. Plaintiffs alleged with respect to Ryder that on December 29, 1975, plaintiffs' car was negligently hit in the rear by a truck owned by Ryder and driven by Ryder's agent and servant, Lawrence Hogsed. On March 7, 1978, plaintiffs filed their amended complaint to include Azar Nut as a defendant, having learned that Azar Nut had leased the truck driven by Hogsed from Ryder and that Hogsed was actually an employee of Azar Nut.

On March 30, 1978, Ryder filed its motion for summary judgment, arguing that it could not be liable as a matter of law because there was no genuine issue concerning the fact that Hogsed was not its agent, employee or servant at the time of the accident. With its motion, Ryder filed an affidavit of the District Safety Manager for the Albuquerque, New Mexico District Office of Ryder Truck Rental, Inc. The affidavit stated that the vehicle operated by Hogsed had previously been leased to Hogsed's employer, Azar Nut, and that at the time of the accident with plaintiffs Hogsed was not an agent, servant or employee of Ryder, nor performing any activity at the request of or on behalf of Ryder. In addition, a copy of the lease agreement between Ryder and Azar Nut was attached to the affidavit. It stated that during the term of the lease, it was Ryder's responsibility to provide liability insurance for accidents involving the truck in the amount of $100,000 per person for bodily injury and $300,000 per accident.

On April 11, 1978, Azar Nut moved to dismiss for the reason that, because the accident occurred on December 29, 1975, and Azar Nut was not made a party until March 7, 1978, plaintiffs' action was barred by the two-year statute of limitations. Ill. Rev. Stat. 1975, ch. 83, par. 15.

Plaintiffs filed a response to these motions, accompanied by the affidavit of their attorney. In his affidavit, the attorney stated that prior to the time plaintiffs filed suit against Ryder, he and Tasch not only exchanged the previously described correspondence, but he also had numerous telephone conversations with Tasch, "who at all times represented * * * that he was negotiating this matter on behalf of Ryder Truck Rental, Inc." Plaintiffs' attorney further stated that the first time he was told Azar Nut had leased the truck from Ryder and that Hogsed was Azar Nut's employee was when Tasch informed him of this in a telephone conversation after both the original complaint had been filed and the statute of limitations against Azar Nut had run. Plaintiffs' attorney also stated in his affidavit that in this conversation Tasch advised him that in view of the fact that Ryder was not responsible for the accident he should reduce his demand and settle the action. Defendants did not file a counteraffidavit.

Based on the affidavit of their attorney, plaintiffs argued to the trial court that Tasch either misled plaintiffs' attorney into believing Ryder Truck was the proper party to sue or that Tasch intentionally failed to correct plaintiffs' attorney's mistaken assumption until after the statute of limitations against Azar Nut had run. The ...

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