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July 21, 1997



Presiding Justice Campbell delivered the opinion of the court. O'brien, J., specially concur. Gallagher, J., specially concur.

The opinion of the court was delivered by: Campbell

PRESIDING JUSTICE CAMPBELL delivered the opinion of the court:

Plaintiff Larry Smith appeals an order of the circuit court of Cook County granting judgment on the pleadings to defendant Allstate Insurance Company (Allstate) in a declaratory judgment action.

The record on appeal indicates that on July 8, 1994, plaintiff filed a complaint for declaratory judgment against defendant. The complaint alleged that on January 21, 1993, plaintiff was driving a car east on Golf Road, near the intersection with Narragansett Street, in Morton Grove. Michael Garrity was driving west on Golf Road; Brian Barry and Brendan Mahoney were passengers in the car Garrity was driving. According to the complaint, Garrity negligently caused a collision between the car he was driving and Smith's car. Plaintiff's complaint further alleges that the collision caused him to suffer severe and permanent injuries, including spinal injuries, incomplete para-plegia, prosthetic hypertrophy and sexual dysfunction.

Plaintiff, plaintiff's wife, Mahoney, the estate of Barry and three Barrys individually (the Barrys), all filed suit against Michael Garrity and John Garrity, the owner of the car operated by Michael Garrity. On January 21, 1993, Michael Garrity was an insured driver under a policy issued by State Farm Insurance Company (State Farm) to John Garrity, the owner of the car operated by Michael Garrity. The single limit liability coverage under the State Farm Policy was $100,000 per person/$300,000 per occurrence. Michael Garrity also had $2,000,000 in umbrella coverage from State Farm at the time of the collision. Thus, the maximum coverage available to satisfy the aforementioned claims was $2,300,000.

During the pretrial proceedings in this related matter, State Farm agreed to tender the policy limits on behalf of the Garritys, provided that the matter was settled as to all four claimants. On March 16, 1994, the trial court entered an order granting the Garritys' motion for a good faith settlement order. The order dismissed the claims against the Garritys with prejudice and without costs, with the following amounts being paid in settlement: (1) Larry Smith -- $600,000; (2) Phyllis Smith -- $350,000; (3) the Barrys -- $950,000; and (4) Mahoney -- $400,000. A claim filed by the Barrys against Larry Smith was also dismissed with prejudice, without costs or any amount being paid in settlement.

Plaintiff's complaint for declaratory judgment alleged that on January 21, 1993, plaintiff's car was insured by defendant Allstate. Plaintiff had $1,000,000 of underinsured motorist (UIM) coverage under the Allstate policy. Plaintiff demanded that Allstate tender a $400,000 draft, representing the difference between the limit of the Allstate policy and the amount plaintiff received in settlement of his claim against the Garritys. Allstate refused on the ground that the limits of the Garritys' policies exceeded the Allstate UIM coverage.

On October 17, 1994, defendant Allstate filed a motion for judgment on the pleadings, pursuant to section 2-615(e) of the Illinois Code of Civil Procedure (735 ILCS 5/2-615(e)(1994)). On March 31, 1995, following a hearing on the matter, the trial court granted defendant's motion. Plaintiff filed a timely Notice of Appeal to this court on April 25, 1995.


On appeal, plaintiff contends that the trial court erred in granting judgment on the pleadings. A motion for judgment on the pleadings tests the sufficiency of the pleadings by determining whether the plaintiff is entitled to the relief sought by the complaint or, alternatively, whether the defendant by his or her answer has set up a defense that would entitle him or her to a hearing on the merits. TDC Development Corp. v. First Federal Sav. and Loan Ass'n of Ottawa, 204 Ill. App. 3d 170, 173, 561 N.E.2d 1142, 1144, 149 Ill. Dec. 446 (1990). In deciding the motion, the trial court must examine all pleadings on file to determine whether a material factual dispute exists or whether the controversy can be resolved strictly as a matter of law. TDC Development Corp., 204 Ill. App. 3d at 173, 561 N.E.2d at 1144. Judgment on the pleadings is proper if only questions of law and not of fact exist after the pleadings have been filed. Walker v. State Board of Elections, 65 Ill. 2d 543, 359 N.E.2d 113, 3 Ill. Dec. 703 (1976).

Although a motion for judgment on the pleadings is similar to a motion for summary judgment insofar as both suggest that no material issue of fact exists, a judgment on the pleadings must rely on the allegations of the complaint to establish the absence of material fact, whereas summary judgment may rely on affidavits and other documents. Waterfront Estates Development, Inc. v. City of Palos Hills, 232 Ill. App. 3d 367, 371-72, 597 N.E.2d 641, 645, 173 Ill. Dec. 667 (1992). In addition, the well-pleaded allegations of the non-moving party and inferences therefrom are taken as true. See Mitchell v. Waddell, 189 Ill. App. 3d 179, 182, 544 N.E.2d 1261, 1262-63, 136 Ill. Dec. 486 (1989). Given the procedural posture of the case and that the issues concern the interpretation of a statute, the standard of review is de novo.


The sole issue on appeal is the interpretation of section 143a-2(4) of the Code. In recent years, this court has been called upon to rule on the issue of whether an insured may recover under his or her underinsured motorist coverage where the person responsible for the occurrence has coverage limits higher than the insured's underinsured motorist coverage limit, but multiple claimants have exhausted the coverage. On March 31, 1995, the date the trial court granted judgment on the pleadings, every district of this court to consider the issue had ruled in favor of the insurer. Golladay v. Allied American Ins. Co., 271 Ill. App. 3d 465, 648 N.E.2d 157, 207 Ill. Dec. 701 (1st Dist. 1995); Illinois Farmers Ins. Co. v. Tabor, 267 Ill. App. 3d 245, 642 N.E.2d 159, 204 Ill. Dec. 697 (2nd Dist. 1994); Purlee v. Liberty Mutual Fire Ins. Co., 260 Ill. App. 3d 11, 631 N.E.2d 433, 197 Ill. Dec. 430 (5th Dist. 1994); Moriconi v. Sentry Ins. of Illinois, Inc., 193 Ill. App. 3d 904, 550 N.E.2d 637, 140 Ill. Dec. 752 (4th Dist. 1990). The Fifth District, however, has recently reversed its position on this issue. Hathaway v. Standard Mutual Ins. Co., 285 Ill. App. 3d 67, 673 N.E.2d 725, 220 Ill. Dec. 581 (1996); Cummins v. Country Mutual Ins. Co., 281 Ill. App. 3d ...

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