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Labor World, Inc. v. Just Parts

August 24, 2000


Appeal from the Circuit Court of De Kalb County. No. 98--L--34 Honorable John W. Countryman, Judge, Presiding.

The opinion of the court was delivered by: Justice Thomas

Plaintiff, Labor World, Inc., appeals the trial court's order dismissing count I of its amended complaint against defendant, Just Parts, Inc. Plaintiff argues that count I contained a viable claim of breach of contract. We reverse and remand.

In count I of its amended complaint, plaintiff made the following allegations. Plaintiff was a corporation in the business of providing temporary industrial personnel. Plaintiff contracted to provide defendant with the services of Jose Sanchez. Pursuant to that contract, defendant's authorized agent signed daily "time tickets" that set out the hours Sanchez worked. Defendant's agent signed each ticket below a statement that read, "CUSTOMER AGREES TO THE TERMS ON THE REVERSE SIDE OF THIS TICKET."

On the reverse side of each ticket were a number of "TERMS AND CONDITIONS." Term No. 4 stated as follows:

"CUSTOMER shall not employ LABOR WORLD employees to operate dangerous or unprotected machinery or equipment, or to perform any work on or using ladders or scaffolding or to perform excavation work where proper shoring and protection is not provided."

Plaintiff alleged that, in breach of term No. 4, defendant placed Sanchez in a "modified lift/basket forklift" and elevated him several feet. Sanchez fell to the ground and was seriously injured.

According to count I, Sanchez filed a workers' compensation claim against plaintiff. Plaintiff settled that claim by paying Sanchez a total of $70,151.54. Plaintiff sought to recover that sum from defendant, concluding that "Defendant breached its obligation to Plaintiff to preclude Mr. Sanchez from being in a dangerous situation, thus subjecting Plaintiff to liability."

Pursuant to section 2--619 of the Code of Civil Procedure (735 ILCS 5/2--619 (West 1998)), defendant moved to dismiss count I. Defendant asserted that plaintiff's claim of breach of term No. 4 was barred by a separate contract between the parties. According to that contract, defendant was an alternate insured under plaintiff's policy of workers' compensation insurance. Plaintiff assured defendant that its insurance would cover any workers' compensation claim that arose while plaintiff's employee was working for defendant. Therefore, defendant argued, plaintiff's claim was precluded by the following principle:

"When parties to a business transaction agree that insurance will be provided as a part of the bargain, the agreement must be interpreted as providing mutual exculpation to the bargaining parties. The parties are thus deemed to have agreed to look solely to the insurance in the event of loss, and not impose liability on the other." Monical v. State Farm Insurance Co., 211 Ill. App. 3d 215, 223 (1991), citing Briseno v. Chicago Union Station Co., 197 Ill. App. 3d 902, 905 (1990), citing Vandygriff v. Commonwealth Edison Co., 87 Ill. App. 3d 374, 378 (1980).

Defendant concluded that, because plaintiff agreed to insure defendant against workers' compensation claims, plaintiff could not subject defendant to liability for Sanchez's claim.

Defendant also challenged the truth of plaintiff's allegations. Defendant asserted that Sanchez's claim was paid not by plaintiff but by plaintiff's insurance carrier. Thus, defendant maintained, plaintiff's lawsuit essentially was a subrogation claim.

In its response, plaintiff did not deny that defendant was covered by plaintiff's workers' compensation insurance. However, plaintiff argued that the parties' contract for insurance did not preclude plaintiff from recovering for defendant's breach of term No. 4. According to plaintiff, that breach of contract distinguished the present case from those upon which defendant relied.

The trial court dismissed count I with prejudice. It ruled also that its order was immediately appealable (see 155 Ill. 2d R. 304(a)). Plaintiff timely appealed.

A motion to dismiss pursuant to section 2--619 may be granted only if no material facts are in dispute and the moving party is entitled to dismissal as a matter of law. Rochon v. Rodriguez, 293 Ill. App. 3d 952, 958 (1997). All well-pleaded allegations in the complaint must be taken as true. American National Bank & Trust Co. v. Thomas, 288 Ill. App. 3d 343, 346 (1997). Our ...

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