Appeal from the Circuit Court of Lake County; the Hon. Bernard
K. Drew, Judge, presiding.
JUSTICE HOPF DELIVERED THE OPINION OF THE COURT:
Plaintiff, Beth Anderson, appeals from an order of the trial court of Lake County denying her motion for summary judgment and granting defendant Interstate Fire & Casualty Company's (Interstate's) motion for summary judgment with regard to count I of plaintiff's second amended complaint. Count I sought a declaratory judgment that an oral insurance binder included, as a matter of law, underinsured-motorist coverage in an amount equal to the maximum liability limits offered by the insurer.
On appeal plaintiff contends that the trial court erred (1) in finding that she was uninsured at the time she sustained injury and (2) in failing to find that underinsured-motorist coverage was implied as a matter of law in her contract of insurance.
On May 3, 1983, Richard Anderson (Anderson) purchased a used motorcycle as a gift for his wife, Beth, who is the plaintiff in this case. On May 5, 1983, Anderson telephoned George Vrahnos, an independent insurance broker who handled other insurance for Anderson, and asked about insurance for the motorcycle. Vrahnos, who claimed he did not usually write motorcycle insurance, pulled from his files a policy he had previously obtained from defendant insurance company on a cycle similar to the Andersons'. He indicated to Anderson that the coverages contained in the other client's policy were $100,000/$300,000 bodily injury, $50,000 property damage, $15,000/$30,000 uninsured motorist, and no collision. Vrahnos also stated a cost for the insurance coverages he had enumerated. According to Vrahnos, Anderson indicated he wanted that coverage. Anderson, on the other hand, stated he did not request any specific coverages, although he seemed to recall Vrahnos mentioning $300,000 liability coverage as well as a discussion to the effect that collision insurance was probably not necessary. Vrahnos indicated that he would send Anderson an application form.
Subsequently, Vrahnos telephoned Interstate and spoke with Pam Morrett, a rating clerk in the auto department of Interstate's Chicago branch who was authorized to give insurance binders (temporary insurance contracts) to insurance agents and brokers. Vrahnos requested authorization to bind the coverages he had discussed with Anderson. Morrett granted authorization for a binder, effective for five working days, and gave Vrahnos a binder number. She also indicated that a completed application would be necessary in order to continue coverage.
The next day, May 6, 1983, Beth Anderson was seriously injured when an auto drove into her as she rode the motorcycle. Anderson notified Vrahnos of the accident on May 9 and indicated he no longer wanted the insurance. When Anderson told him that the driver of the car which struck his wife had $25,000 in liability insurance, Vrahnos convinced Anderson not to cancel the binder until the driver's insurance coverage had been confirmed.
Anderson spoke with an attorney on May 11 and on May 12 asked Vrahnos if he, Anderson, had underinsured-motorist coverage on the motorcycle. That same day Vrahnos secured a binder extension, under a new binder number, from Pam Morrett at Interstate. On May 16 Vrahnos sent an application for permanent insurance to Anderson to be signed and returned. The application included information regarding both uninsured- and underinsured-motorist coverage and offered the prospective insured the option of adding or rejecting underinsured coverage. Also on May 16, Vrahnos told Anderson that he did not have underinsured coverage. On May 17 Vrahnos obtained a second five-day binder extension from Morrett.
The application for permanent insurance was received by Anderson on May 18, 1983. He signed it but did not check any of the options pertinent to underinsured-motorist coverage. The application form was never returned to Vrahnos by Anderson. Instead, Anderson turned it over to his attorney. On May 20 or 21 Vrahnos repeatedly phoned Anderson, requesting that Anderson sign and return the application. On May 25 Vrahnos secured another binder extension and sent a written insurance binder, covering all prior oral binders, to Anderson, with a copy to Interstate.
Plaintiff filed suit against Vrahnos and Interstate on August 31, 1983. Count I of plaintiff's second amended complaint sought a declaratory judgment against Interstate to determine that, as a matter of law, at the time of the accident plaintiff had $100,000 in underinsured-motorist coverage. Cross-motions for summary judgment were filed by plaintiff and defendant Interstate. After a hearing on the motions, the trial court indicated that it did not think there was any material question of fact to be resolved. The court found that plaintiff was not insured by defendant at the time of her injury because a contract between the Andersons and Interstate had never come into being. According to the court, the Andersons' failure to return the application for permanent insurance constituted a total failure to tender consideration for insurance coverage. Since the trial court held that there was no enforceable contract, it did not address the question of whether plaintiff had underinsured-motorist coverage as a matter of law. Interstate's motion for summary judgment was granted, while plaintiff's was denied. Plaintiff's subsequent motion for reconsideration was also denied, and this appeal followed.
• 1 Plaintiff appeals from trial court action on cross-motions for summary judgment. Under section 2-1005 of the Code of Civil Procedure (Ill. Rev. Stat. 1983, ch. 110, par. 2-1005), summary judgment is proper only when the pleadings, depositions, admissions, and affidavits show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Here, we agree with the trial court that there were no material fact issues to be resolved. We also agree that Interstate was entitled to judgment as a matter of law. However, we reach the latter conclusion by a route different from that taken by the trial court. A trial court order, if correct, may be upheld on appeal on grounds other than those relied on by the trial court, regardless of the lower court's reasoning. Village of Schaumburg v. Franberg (1981), 99 Ill. App.3d 1, 9, 424 N.E.2d 1239.
• 2 The court below resolved the issues in accordance with its analysis of the preliminary question of whether or not there was an enforceable contract between plaintiff and Interstate. Since the court decided there was no contract, plaintiff's claim could not be sustained. The trial court's conclusion, however, that the contract failed for lack of consideration cannot be supported as a matter of law. Return of the application was not needed for consideration since plaintiff had already impliedly promised to pay for the coverage she sought. (See Elliot v. Villa Park Trust & Savings Bank (1978), 63 Ill. App.3d 714, 717, 380 N.E.2d 507.) Mutual and concurrent promises provide sufficient legal consideration to support each other. (Leisure v. Smith (1973), 13 Ill. App.3d 1070, 1073, 302 N.E.2d 177.) In the instant case Interstate promised to provide insurance coverage and the Andersons promised to pay for that coverage. These mutual promises constituted sufficient consideration for the oral contract entered into on May 5, 1983.
Interstate characterizes the return of the application as a condition of the contract. It insists that since the application was not returned no duty arose on its part to cover losses incurred during the five-day term of the binder. We find little support for defendant's position.
The parties do not dispute in any material way what was said in the May 5 conversation between Vrahnos and Morrett. Vrahnos requested permission to bind coverages for the Andersons' motorcycle in specified amounts. Morrett asked for the information she needed for all such binders and quoted a premium. She also authorized the binder, gave Vrahnos a binder number, and told Vrahnos the binder was in effect for five working days and that an application for permanent insurance had to be returned within that time to continue coverage. Although Morrett did not recall being asked, Vrahnos said he requested that an application be sent to him. While the parties do not dispute that these were the verbal contents of the oral contract, they do not agree on the meaning of certain of those contents. Interstate insists that Morrett's statement that an application had to be returned in five days set forth a condition and made it a term of the contract. The Andersons, on the other hand, maintain that the statement meant they would have insurance coverage for the next five days, but no more, unless they returned the application.
• 3 The first issue raised by the parties requires this court to interpret the oral contract between Interstate and the Andersons. The question of construction of a contract, which does not involve material issues of fact, is a question of law on which a reviewing court may make an independent ...