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08/19/94 PROVIDENT LIFE AND ACCIDENT INSURANCE

August 19, 1994

PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, PLAINTIFF-APPELLANT,
v.
STEPHEN E. SMITH, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Cook County. Honorable Edwin M. Berman, Judge Presiding.

Petition for Leave to Appeal Denied December 6, 1994.

McNULTY, Murray, Cousins

The opinion of the court was delivered by: Mcnulty

JUSTICE McNULTY delivered the opinion of the court:

Plaintiff Provident Life and Accident Insurance Company (Provident) brought an action in the Chancery Division of the circuit court of Cook County for rescission of two policies of disability insurance issued on June 30, 1987, by Provident to Stephen E. Smith (Smith). Smith filed a counterclaim for breach of contract. Action thereon was stayed pending resolution of the rescission action. The trial court denied Provident's action for rescission. This appeal followed. Provident requests that the trial court's decision be reversed. In the alternative Provident requests that the policies be reformed to exclude disability benefits and coverage for disability related to conditions associated with Smith's lumbar or sacroiliac spine region. Provident also argues in the alternative that the trial court's errors in ruling on evidentiary matters require the decision to be reversed and remanded for further proceedings.

I

While neither party contests this court's jurisdiction to hear this appeal, the consent of the parties does not confer jurisdiction. ( Droste v. Kerner (1966), 34 Ill. 2d 495, 217 N.E.2d 73.) We raise the jurisdictional question sua sponte. In order to facilitate the Discussion it is necessary to recite chronologically certain procedural events in this case. The trial court in the chancery division of the circuit court of Cook County rendered final judgment against Provident on its rescission action on August 23, 1991. The losing party requested Supreme Court Rule 304(a) language to pursue an appeal, but this was denied by the Judge because the other claims referred to above remained pending.

There is no dispute that this ruling constituted a complete and final resolution of the rescission matter between the parties. The refusal of the Judge to add 304(a) language to the order did not deprive the order of finality regarding this claim but, rather, caused it to be unappealable when rendered.

Judge Berman on November 5, 1991, entered an order which stated as follows: "It is hereby ordered that after considering plaintiff's motion to reconsider [the refusal to grant 304(a) language to the August 23, 1991 order], the court denies plaintiff's request for a Rule 304(a) Finding." Any attempt by Provident to appeal this order would have been futile in light of E.M.S. Co. v. Brandt (1968), 103 Ill. App. 2d 445, 243 N.E.2d 695, which held thatsuch a decision is not reviewable when rendered even if the trial court abused its discretion in refusing to give a litigant a 304(a) finding.

Provident made no attempt to sever Smith's counterclaim which was still pending, but on August 23, 1991, at the Conclusion of the rescission litigation Judge Berman sent the case to the presiding Judge of the chancery division to transfer the breach of contract and disability claims to the law division for final resolution. Although the case was given a new number in the law division it is clear from the record that the pleadings filed in the law division reflected the fact that this was further litigation of the law suit that originally commenced in the chancery division.

The law division case regarding Smith's counterclaims was not resolved judicially but, instead, was settled by an agreed order entered by Judge Gustafson on April 13, 1993, about 18 months after the entry of the order by Judge Berman denying 304(a) language to Provident. This agreed order contained the following language:

"IT IS FURTHER ORDERED, that, based upon the above described conditions, this matter is dismissed with prejudice and without costs to either party and that, pursuant to Illinois Supreme Court Rule 304(a), the court sua sponte, determines that the court order of October 1, 1991 [the decision on rescission] is now a final and appealable order and there is no just reason to delay enforcement or appeal of such order."

It further specified that the settlement agreement appended thereto was made a part of the agreed order. Paragraph 7 of the settlement agreement stated:

"Smith and Provident agree that if the appeal of the order dated October 1, 1991 is not accepted and/or does not result in an opinion on the merits by the Illinois Appellate Court, that any claim ...


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