Appeal from the Circuit Court of Winnebago County. No. 95--L--245 Honorable Ronald L. Pirrello, Judge, Presiding.
The opinion of the court was delivered by: Justice Thomas
IN THE COURT OF APPEALS OF THE STATE OF ILLINOIS
The plaintiff, Mary Readel, filed this medical malpractice action against the defendants, William S. Towne, M.D.; Rockford Anesthesiologists Associated (Rockford); and OSF Healthcare System, d/b/a St. Anthony Hospital (the Hospital), asserting claims pursuant to the Wrongful Death Act (740 ILCS 180/0.01 et seq. (West 1996)) and the Survival Act (755 ILCS 5/27--6 (West 1996)) in connection with the injury and death of her mother, Donna Lorke (Donna). The plaintiff and the defendant Hospital entered into a pretrial settlement agreement for $750,000. The settlement allocated the proceeds as follows: $650,000 for the survival claim; $80,000 for the wrongful death claim; and $20,000 for a claim brought pursuant to the family expense statute (750 ILCS 65/15 (West 1996)). The Hospital filed a motion for a good-faith finding by the trial court approving the settlement. Rockford objected to the settlement on the basis that it contained a disproportionate allocation between the survival and wrongful death claims and requested that the trial court reallocate the settlement. The trial court denied Rockford's request and found that the settlement was entered into in good faith. Rockford appeals from that ruling.
The record reveals that on April 3, 1995, Donna was admitted to the Hospital suffering from shortness of breath and dyspnea. At the time, she was 66 years old and the plaintiff was her only next of kin. Dr. Towne, an anesthesiologist and employee of defendant Rockford, suspected that Donna had suffered a heart attack. He ordered that she undergo a blood-oxygen test on April 6, 1995, that required intubation. Respiratory therapists employed by the Hospital set up a CPAP, a valve that is placed in the system of tubes between a ventilator machine and the patient to regulate air pressure.
Once connected, the valve forced a massive and unregulated flow of air pressure into Donna's lungs, causing sudden and severe damage to Donna's body. Donna suffered an immediate cardiac arrest. Thereafter, she remained comatose and unresponsive. She suffered three additional cardiac arrests before she died about 26 hours after the CPAP valve was set up.
The plaintiff's complaint alleged that Dr. Towne and the Hospital improperly connected the ventilator system with the CPAP and were negligent in failing to inspect the system and disconnect it. The plaintiff testified in her discovery deposition that she and her mother had had a very close and loving relationship. They lived in the same small town and were in daily contact. Donna had frequently babysat for the plaintiff's children. Donna also had helped the plaintiff financially and had paid for the plaintiff's family to take several vacations.
The plaintiff made a settlement demand on all the defendants, seeking $1,500,000 to settle the wrongful death claim and $1,000,000 to settle the survival claim. Thereafter, the Hospital agreed to settle with the plaintiff. Defendants Rockford and Dr. Towne did not make an offer to settle with the plaintiff. The Hospital filed a motion for a good-faith finding of the settlement and attached a copy of the settlement agreement to the motion. The settlement provided the following:
"[F]or and in consideration of the sum of Seven Hundred Fifty Thousand Dollars ($750,000) *** I, [the plaintiff], settle and compromise any and all claims against [the Hospital].
I, [the plaintiff], *** intend to allocate the settlement proceeds contained herein in the following fashion. Plaintiff allocates Six Hundred Fifty Thousand Dollars ($650,000) of the settlement proceeds to the Survival Act Claim *** Eighty Thousand Dollars ($80,000) of the settlement proceeds herein to the Wrongful Death Claim and Twenty Thousand Dollars ($20,000) of the settlement proceeds to the Family Expense Act Claim."
Rockford and Dr. Towne, the non-settling defendants, filed a motion objecting to the allocation of the settlement and requesting the following: that the court permit discovery and an opportunity to call witnesses at an evidentiary hearing to determine the "good faith" of the settlement and the proper allocation; that the court find that the settlement was not a fair and reasonable allocation and/or that it was not made in good faith; and that the court reallocate the settlement. Following consideration of the parties' briefs on the issue, the case law, and the arguments of the respective counsels presented at a hearing, the trial court issued a written memorandum of decision stating the following: "I have considered first whether or not it is the proper action for the Court to review, at this stage of the litigation, the agreement between Plaintiff and [the Hospital]. In the cases cited by Defendant, I note that the Pritchard case states that whether an agreement is in good faith is left largely to the discretion of the Court and that there is a presumption of validity to the agreement once the settling parties so represent to the Court. *** I do not feel that it is necessary for the trial court to involve itself in the good faith agreement absent a showing by Defendant that there was collusion or other active bad faith. Indeed, the case law suggests to me that the trial court should absent itself from settlement agreements of the parties at this stage of the litigation unless it is shown by clear and convincing evidence that such bad faith exists. I will find that that is not the case and grant [the Hospital's] motion for a good faith finding."
On appeal, Rockford contends that (1) the settlement proceeds allocation awarding almost 90% of the settlement to the survival claim demonstrated that the settlement was not in good faith and should not have been approved by the trial court; (2) the trial court erred in failing to exercise its discretion to determine the fairness and reasonableness of the allocation; and (3) the trial court erred in failing to hold an evidentiary hearing on the issue of the good faith of the settlement.
Section 2(c) of the Joint Tortfeasor Contribution Act provides:
"When a release or covenant not to sue or not to enforce judgment is given in good faith to one or more persons liable in tort arising out of the same injury or the same wrongful death, it does not discharge any of the other tortfeasors from liability for the injury or wrongful death unless its terms so provide but it reduces the recovery on any claim against the others to the extent of any amount stated in the release or the covenant, ...