Appeal from the Circuit Court of Franklin County. No. 00-L-54 Honorable David L. Underwood, Judge, presiding.
The opinion of the court was delivered by: Justice Goldenhersh
After arbitration, Joseph Kost and Deborah Kost (plaintiffs), coadministrators of the estate of Robert S. Kost, deceased, made an underinsured-motorist claim under a policy issued by The Farmers Automobile Insurance Association (defendant). After arbitration, plaintiffs filed suit in the circuit court of Franklin County and sought a trial on the issue of damages, pursuant to the trial de novo clause of the insurance policy. Upon defendant's motion, the court dismissed plaintiffs' complaint with prejudice. On appeal, plaintiffs raise the issue of whether they should be precluded from invoking the trial de novo clause. We reverse and remand.
Robert S. Kost entered into a contract for automobile insurance with defendant. Subsequently, Kost was fatally injured in an automobile accident. The limits of liability for the insurance of the driver involved in the accident were paid to plaintiffs as administrators of Kost's estate. Plaintiffs then presented a claim for underinsured-motorist coverage to defendant.
The insurance policy provides that if the insured and the insurer do not agree as to the amount of damages, either party may make a written demand for arbitration. The policy states:
"A decision agreed to by two of the arbitrators will be binding as to:
a. Whether the 'insured' is legally entitled to recover damages; and
b. The amount of damages. This applies only if the amount does not exceed the minimum limit for 'bodily injury' liability specified by the Illinois Safety Responsibility Law. If the amount exceeds that limit, either party may demand the right to a trial.
This demand must be made within 60 days of the arbitrator's decision. If this demand is not made, the amount of damages agreed to by the arbitrators will be binding."
Plaintiffs' claim was submitted to arbitration. A panel of arbitrators issued an award. The arbitrators found the total amount of damages resulting from Kost's injury to be $300,000, and they found Kost to be 50% negligent. Recoverable damages were assessed at $150,000.
Plaintiffs filed a complaint in the circuit court of Franklin County and requested that the arbitration award be vacated in accordance with the trial de novo clause of the insurance policy. Defendant filed a motion to dismiss. The trial court granted defendant's motion and dismissed plaintiffs' complaint with prejudice. Plaintiffs appeal.
The trial court discussed plaintiffs' complaint and cited to cases in which trial de novo provisions similar to the one at bar have been voided as being against public policy. See Fireman's Fund Insurance Cos. v. Bugailiskis, 278 Ill. App. 3d 19, 662 N.E.2d 555 (1996); Parker v. American Family Insurance Co., 315 Ill. App. 3d 431, 734 N.E.2d 83 (2000). Plaintiffs contend that such clauses have been voided because of unfair drafting by insurers and that insureds should still be able to seek a trial de novo. Because the issue raised is a question of ...