Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. John N. Hourihane, Judge, presiding.
The Honorable Justice Harrison delivered the opinion of the court: Chief Justice Bilandic took no part in the consideration or decision of this case.
The opinion of the court was delivered by: Harrison
JUSTICE HARRISON delivered the opinion of the court:
In this appeal, we are asked to decide whether plaintiff, Molly Grzeszczak, and her three minor children are entitled to stack the underinsured-motorist coverage contained in two automobile policies issued by defendant, Illinois Farmers Insurance Company (Illinois Farmers). Molly Grzeszczak initiated an action for declaratory judgment, on behalf of herself and her three minor children, to construe the limits of underinsured-motorist coverage contained in two policies. The circuit court of Cook County entered judgment on the pleadings in favor of Illinois Farmers (735 ILCS 5/2-615(e) (West 1992)), reasoning that the antistacking clausescontained in the insurance policies were clear and unambiguous, precluding the stacking of underinsured-motorist coverage. The appellate court reversed and remanded. (260 Ill. App. 3d 850.) We granted leave to appeal (145 Ill. 2d R. 315). For the reasons that follow, we reverse the appellate court's judgment and affirm the judgment of the circuit court.
The facts are not in dispute. On November 19, 1989, Molly Grzeszczak's decedent, Jeffrey Grzeszczak, was killed while riding in an automobile owned and driven by his brother, Richard Grzeszczak. At the time of the accident, Richard was insured by CNA Insurance Companies (CNA). The limits of Richard's policy were $100,000 for each person and $300,000 for each occurrence. After Molly filed suit on behalf of herself and her three minor children against Richard, CNA settled with her for $100,000, the limit of Richard's policy.
Jeffrey was also covered on two separate insurance policies which were purchased from Illinois Farmers. Jeffrey was the only named insured on the first policy, which covered a 1984 Chevrolet automobile. The first policy provided underinsured-motorist coverage to Jeffrey and his family for injuries received as a result of auto accidents involving any automobile. The first policy also provided coverage for any nonfamily passenger in the 1984 Chevrolet if the accident was caused by an underinsured motorist. The second policy covered a 1983 Oldsmobile, and both Jeffrey and his wife, Molly, were named as the insureds. Since the underinsured-motorist coverage on the first vehicle followed the Grzeszczaks and their family members regardless of where they were injured, the coverage from the second policy overlapped the coverage the Grzeszczaks were already entitled to receive from the first policy. However, the second policy did provide coverage to persons not covered by the first policy, namely, nonfamily passengers riding in the 1983 Oldsmobile who were involvedin an accident with an underinsured motorist. Both policies provided for underinsured-motorist coverage of $100,000 for each person and $300,000 for each occurrence. The Grzeszczaks paid an identical premium of $23.30 for underinsured-motorist coverage under each policy.
In December 1990, Molly notified Illinois Farmers of the $100,000 settlement with Richard's insurer, CNA. Molly demanded payment from Illinois Farmers of an additional $100,000, claiming that all of her family's damages were not covered by the $100,000 limit of Richard's policy. Her theory was that her husband Jeffrey had a combined total of $200,000 underinsured-motorist coverage under the two policies. She arrived at this $200,000 figure by doubling the $100,000 limit under each policy, reasoning that separate premiums for each vehicle entitled separate $100,000 amounts of coverage. Thus, Molly claimed that her family was entitled to an additional $100,000, which amounted to the difference between Jeffrey's total coverage of $200,000, and the $100,000 recovered from Richard Grzeszczak's policy with CNA. Illinois Farmers denied Molly's claim that the coverage should be stacked to provide a total recovery of $200,000, based on antistacking clauses contained in each policy. Illinois Farmers noted that according to these clauses, the insured was not permitted to aggregate or "stack" the underinsured-motorist benefits and, in essence, receive more than the single policy limit.
The antistacking provisions in the Grzeszczaks' policies provided:
6. Two or More Cars Insured
With respect to any accident or occurrence to which this and any other auto policy issued to you by any member company of the Farmers Insurance Group of Companies applies, the total limit of liability under allthe policies shall not exceed the highest applicable limit of liability under any one policy."
The policies further provided:
Throughout this policy 'you' and 'your' mean the 'named insured' shown in the Declarations and spouse if ...