Appeal from the Circuit Court of Cook County. Honorable Sidney D. Jones III, Judge Presiding.
Rehearing Denied November 4, 1996. Released for Publication November 18, 1996.
Presiding Justice Tully delivered the opinion of the court: Cerda, J., concurs. Greiman, J., dissents.
The opinion of the court was delivered by: Tully
At the time of the accident, plaintiffs were insured by Country Companies (hereinafter Country) with an automobile liability policy of $50,000 per person/$100,000 per accident and it also included uninsured motorist coverage with the same policy limits. Defendants were covered by Prestige Casualty Company (hereinafter Prestige) with policy limits of $20,000 per person/$40,000 per accident. Prestige appointed attorneys for defendants.
On August 16, 1994, Prestige became insolvent and was placed in liquidation. The Illinois Insurance Guaranty Fund (hereinafter "Fund") stepped in pursuant to Illinois Insurance Guaranty Fund Act (Act) (215 ILCS 5/532 et seq. (West 1994)). The Fund took over the defense of defendants. Defendants were now regarded as uninsured motorists, because under section 143(a), a motorist insured by an insolvent insurer is considered an uninsured motorist (215 ILCS 5/143(a) (West 1994)). Plaintiffs filed a motion to stay the proceedings while they filed a claim against their own insurance company under the uninsured motorist provision of their policy. Consequently, plaintiffs made a written demand for arbitration. Country negotiated a settlement of $7,500 for Frank and $3,000 for Buccieri which plaintiffs accepted.
Plaintiffs then continued their case in the circuit court and the case was sent to mandatory arbitration. The arbitrators awarded $9,000 to Frank and $4,000 to Buccieri. No rejection of the award was filed within the required time.
Defendants filed a motion for set-off of plaintiffs' entire uninsured policy pursuant to the "non-duplication of recovery provision" in the Act (735 ILCS 5/546(a) (West 1994)). Defendants argue that since plaintiffs settled rather than arbitrate their uninsured motorist claim, defendants were entitled to a set-off consisting of the limits of plaintiffs' uninsured motorist coverage. The trial court denied the motion, and concluded that defendants were only entitled to a partial set-off. The trial court entered judgment against defendants in the amount of $616.50 for Hasemann and $425.50 for Buccieri.
ISSUE PRESENTED FOR REVIEW
The sole issue is whether plaintiffs first exhausted their rights under their own uninsured motorist policy before filling a claim against defendants and the Fund.
The Illinois Insurance Guaranty Fund is a statutory entity created by the General Assembly to provide a limited form of relief to claimants and insureds when insurance companies becomes insolvent. The purpose is to place claimants in the same position that they would have been in if the liability insurer had not becomeinsolvent. Lucas v. Illinois Insurance Guaranty Fund, 52 Ill. App. 3d 237, 367 N.E.2d 469, 10 Ill. Dec. 81 (1977). The Act does not permit double recovery for plaintiffs. Section 546(a) of the Code of Civil Procedure provides as follows:
"Non-duplication of recovery. (a) Any insured or claimant having a covered claim against the Fund shall be required first to exhaust his rights under any provision in any other insurance policy which may be applicable to the claim. Any amount payable on a covered claim under this Article shall be reduced by the amount of such recovery under such insurance policy." 735 ILCS 5/546(a) (West 1994).
Defendants contend that plaintiffs must first exhaust all their rights under their uninsured motorist policy with Country before they can recover any amount from the Fund or from defendants. Defendants further contend that plaintiffs should not be allowed to settle for less than the uninsured motorist policy limits, and then seek to recover the balance of their judgment from the Fund, whose limited assets ultimately come from the insurance buying public of Illinois. Plaintiffs claim that they did indeed exhaust their rights as required under section 546(a). We agree with plaintiffs.
We first look to the language and the intent of section 546(a). "In interpreting a disputed provision a court should first consider the statutory language itself as the best indication of the intent of the drafters. [Citation.] Terms that are unambiguous, when not specifically defined, must be given their plain and ordinary meaning." People ex rel. Village of McCook v. Indiana Harbor Belt R.R., 256 Ill. App. 3d 27, 29, 194 Ill. Dec. 800, 628 N.E.2d 297 (1993); see also Hayes v. Mercy Hospital & Medical Center, 136 Ill. 2d 450, 145 Ill. Dec. 894, 557 N.E.2d 873 (1990). In establishing the legislative intent, it is settled that a court may consider not only the language used in the statute, but also the reason and necessity for the law, the evils sought to be remedied, and the purposes to be achieved. Urban v. Loham, 227 Ill. App. 3d 772, 775, 592 N.E.2d 292, 169 Ill. Dec. 805 (1992), citing Stewart v. Industrial Comm'n, 115 Ill. 2d 337, 105 Ill. Dec. 215, 504 N.E.2d 84 (1987). "It is ...