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Chubb v. Amax Coal Co.

OPINION FILED JULY 11, 1984.

JACK L. CHUBB, PLAINTIFF-APPELLANT,

v.

AMAX COAL COMPANY, INC., ET AL., DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Wabash County; the Hon. Robert M. Keenan, Judge, presiding.

JUSTICE JONES DELIVERED THE OPINION OF THE COURT:

Plaintiff, Jack Chubb, brought the instant action for disability benefits under a group insurance policy issued to his employer, Amax Coal Company, Inc. (Amax), by Connecticut General Life Insurance Company (Connecticut General). The defendants, Amax and Connecticut General, moved for dismissal of the complaint by reason of a release executed by the plaintiff in settlement of his previous claim for total and permanent disability benefits under the same policy. The trial court granted the motion to dismiss, finding that the release was effective to bar all claims by the plaintiff under the policy in question, including those arising after the execution of the release. On appeal the plaintiff contends that the subject release was limited to claims in existence at the time of its execution and that the court thus erred in dismissing his complaint for benefits for a subsequent unrelated disability.

While the record in the instant case is incomplete due to the summary nature of the proceeding, it appears that the plaintiff had been employed by Amax for a period of time prior to 1981. Early in 1981 he made a claim under group long-term disability policy No. 041635, issued by Connecticut General to Amax for the benefit of its employees. He subsequently filed suit in Federal court on this claim, which was based upon his alleged total and permanent disability. The suit was settled by the parties, and the plaintiff received a payment of $57,000, representing 80% of the then present value of the policy benefits for total and permanent disability until the age of 65. In consideration for this payment, the plaintiff, on April 6, 1981, executed the release that is involved in this appeal.

Shortly thereafter, on August 31, 1981, the plaintiff returned to work for Amax and continued in this employment through March 31, 1983. During this time Amax deducted $450.12 from the plaintiff's salary, which represented the plaintiff's contributions on premiums to Connecticut General for its group disability coverage. On July 7, 1983, the plaintiff filed the instant complaint in which he alleged that he had suffered a myocardial infarction and was totally disabled as a result. The plaintiff alleged that, pursuant to the terms of the policy provided by Amax through Connecticut General, he was entitled to monthly payments of $1,992 for so long as he remained disabled.

In their motion to dismiss the plaintiff's complaint, the defendants set forth the release that had been executed by the plaintiff on April 6, 1981. This release stated in pertinent part:

"RELEASE

FOR AND IN CONSIDERATION of the sum of Fifty Seven Thousand Dollars ($57,000.00) * * * Jack L. Chubb executes and agrees to the terms of this Release:

1. Jack L. Chubb hereby releases and forever discharges Connecticut General Life Insurance Company * * * from any and all claims, demands, obligations, or causes of action of any nature whatsoever * * * including, but not limited to, all claims, obligations or causes of action in any way connected with or arising out of:

(a) Group Long Term Disability Policy No. 041635 issued by Connecticut General to Amax Coal Companies, Inc. insuring its employees, * * *

and/or

(b) Civil Action No. 80-4212 filed in the U.S. District Court for the Southern District of Illinois, styled `Jack L. Chubb v. Amax Coal Companies, Inc., and Connecticut General Life Insurance Company, Hartford, Connecticut.'

6. Jack L. Chubb expressly waives and assumes the risk of any and all claims, demands, obligations or causes of action for damages or other relief arising out of any matter described in paragraph 1 which exist as of this date but which he does not know or suspect to exist in his favor, whether through ignorance, oversight, error, negligence or otherwise, and which, if known, would materially affect his decision to enter this Release." (Emphasis added.)

Amax additionally tendered a refund of the plaintiff's premium payments to him, but these payments were placed in escrow pending the outcome of the case.

Pursuant to the defendants' motion the trial court dismissed the plaintiff's complaint with prejudice. The court reasoned that the release executed by the plaintiff barred him from asserting any claim or cause of action under group long-term disability policy No. 041635 and that "[t]his finding of no liability owed by [Connecticut General] pertained[ed] to matters arising after the date of the release, as well as matters arising prior to the date of the release, insofar as any claim * * * would be based upon [policy No. 041635]." While noting that the condition claimed in the instant case was different from that which was the subject of the release, the court observed, nevertheless, that "the language of said release involve[d] any claims arising out of said policy, and was not limited to the specific condition or injury referred ...


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