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Benge v. State Farm Mutual Automobile Insurance Co.

June 30, 1998

CHARLES BENGE,INDIVIDUALLY AND ON BEHALF OF ALL PERSONS SIMILARLY SITUATED, AND JAMES J. CONVERY, INDIVIDUALLY AND ON BEHALF OF ALL PERSONS SIMILARLY SITUATED, PLAINTIFFS-APPELLANTS,
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, AN ILLINOIS CORPORATION, DEFENDANT-APPELLEE.



The opinion of the court was delivered by: Presiding Justice Hoffman

Appeal from the Circuit Court of Cook County.

No. 96 CH 05727

Honorable Lester D. Foreman, judge Presiding.

The plaintiffs, Charles Benge and James J. Convery, individually and on behalf of all persons similarly situated, appeal from the trial court's dismissal of their second amended class action complaint for breach of contract against the defendant, State Farm Mutual Automobile Insurance Company. For the reasons which follow, we affirm.

On May 30, 1997, the plaintiffs filed a second amended class action complaint ("complaint") for breach of contract against the defendant. The plaintiffs purported to represent the class of persons holding automobile insurance policies issued by the defendant who sustained damage to their motor vehicles when they were involved in accidents with persons also insured by the defendant and who were not paid for those damages by the defendant both under the liability coverage contained in the at-fault drivers' insurance policies, and pursuant to the physical damage coverage contained in their own insurance policies.

The complaint alleged that the plaintiff Convery purchased an automobile insurance policy from the defendant which was effective from May 13, 1995, through December 12, 1995. The physical damage coverage section of that policy provided: "We will pay for loss to your car caused by collision but only for the amount of each such loss in excess of the deductible amount." The policy defined the term "loss" as "each direct and accidental loss of or damage to 1. your car;" and defined the term collision as "your car upset or hit or was hit by a vehicle or other object."

On November 3, 1995, another car, whose driver was also insured by the defendant, struck and damaged Convery's car. Convery reported the facts and circumstances of the accident to one of the defendant's agents. The complaint alleged that Convery's car required $1,156.99 in repairs and that "[t]he invoice for the repair *** was paid in full by [the defendant] pursuant, on information and belief, to the liability coverage which it sold to the driver of the automobile which struck CONVERY's automobile." The complaint further alleged that the defendant failed to pay Convery for those same damages pursuant to the physical damage coverage provision of his own insurance policy.

The complaint also alleged that the plaintiff Benge purchased an automobile insurance policy from the defendant, which, on information and belief, was identical in all relevant respects to Convery's policy. On July 7, 1989, while Benge's insurance policy was in effect, a car whose driver was also insured by the defendant struck and damaged Benge's car. Benge reported the facts and circumstances of the collision to one of the defendant's agents, and, about one month later, the defendant paid Benge $600, the market value of his car. According to the complaint, the defendant paid Benge pursuant to the liability coverage of the at-fault driver and not under the physical damage coverage provision in his own policy.

The plaintiffs alleged that they paid all premiums and complied with all terms and conditions of their insurance policies and that the defendant breached its contractual obligation by failing to pay the plaintiffs' damages under the physical damage coverage of those policies. The complaint charged that the defendant's payments on behalf of the at-fault drivers in no way satisfied the defendant's independent contractual obligation to pay the plaintiffs under the physical damage coverage contained in the plaintiffs' own insurance policies. In their prayer for relief, the plaintiffs asked that the court declare the action to be a proper class action and to award the plaintiffs and the members of the class compensatory damages, pre-judgment and post-judgment interest, and the costs and expenses of the litigation. The plaintiffs also asked the court to enjoin the defendant from engaging in such practices in the future.

On June 27, 1997, the defendant filed a motion to dismiss the plaintiffs' complaint pursuant to section 2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 1996)) and a memorandum in support of its motion. The defendant alleged, inter alia, that 1) the complaint was factually insufficient and failed to plead a breach of contract because the plaintiffs admitted that the defendant paid them for their damages; 2) the plaintiffs' allegations that they were paid pursuant to the policies of the at-fault drivers rather than their own policies were unsupported factual Conclusions; and 3) the complaint was insufficient because the plaintiffs had attached to it the incorrect insurance policy for Convery and no insurance policy for Benge. The defendant also pointed out certain factual inconsistencies in the complaint. As an example, the complaint alleged that Benge's accident took place in Chicago, while an automobile claim report attached as an exhibit to the complaint stated that the accident occurred in Wheeling. Additionally, the defendant argued that the complaint was missing crucial facts, such as the names of the other persons involved in the accidents; the facts, circumstances and locations of the accidents; the names of the defendant's agents to whom Benge and Convery reported their accidents; and specific facts supporting the plaintiffs' Conclusions that the other drivers involved in the accidents were at fault. Alternatively, the defendant contended that dismissal of the complaint was appropriate because the plaintiffs had no right to recover where, under the terms of their insurance policies, their rights to recover against the at-fault drivers passed to the defendant once the defendant paid the plaintiffs for their damages. The provision to which the defendant referred provides:

"Our Right to Recover Our Payments

***

d. Under all other coverages, and except as provided for within the medical payments coverage, the right of recovery of any party we ...


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