Appeal from the Circuit Court of Cook County Honorable James P. McCarthy, Judge Presiding.
The opinion of the court was delivered by: Justice Karnezis
Following mandatory arbitration in this subrogation action involving damages sustained in a vehicle collision by plaintiff's subrogor, judgment on liability was entered in favor of plaintiff, Government Employees Insurance Company (hereinafter, GEICO), and against defendant, Bernadette Campbell. However, the arbitrators awarded GEICO $0 in damages as they found that GEICO had violated defendant's Rule 237(b) (166 Ill. 2d R. 237(b)) notice to produce by failing to produce the "adjuster with the entire claim file." GEICO attempted to reject the award, but the trial court entered an order debarring it from doing so as a sanction for its Rule 237 violation. GEICO now appeals from that order and claims that the trial court erred in barring it from rejecting the arbitration award as it complied with Supreme Court Rule 237. GEICO also argues that even if it violated Rule 237, the sanction of debarment was too harsh. In addition, it maintains that the trial court's reliance upon a written set of "proposed arbitration guidelines" in barring plaintiff's rejection of the arbitration award was improper. Finally, GEICO contends that the trial court improperly considered good faith and meaningful participation under Supreme Court Rule 91(b) (166 Ill. 2d R. 91(b)) as a basis for debarring its rejection of the arbitration award, as defendant waived this argument by failing to raise it in her motion to debar. We affirm.
GEICO filed a subrogation action to recover damages in the amount of $17,081.70 as a result of a vehicle collision between it's subrogor, Millie Booker, and the defendant, Bernadette Campbell.
Defendant served a notice to produce, pursuant to Supreme Court Rule 237(b) (166 Ill. 2d R. 237(b)), on GEICO demanding that, among other things, GEICO produce "[p]laintiff(s) and [c]o-defendant(s) at the commencement of the case in chief of defendant Bernadette Campbell" and, "[i]f the [p]laintiff and/or the [c]o-defendant is a corporation (including an Insurance Company), the claims adjuster with the entire claim file."
A mandatory arbitration hearing was held on November 19, 2001. Counsel for GEICO appeared at the hearing, as did it's subrogor, Millie Booker. Neither the claims adjuster nor the claim file was produced. The arbitrators entered an award in favor of GEICO with respect to liability but awarded GEICO $0 in damages as GEICO "failed to produce file and agent pursuant to Rule 237."
On November 27, 2001, GEICO filed a notice of rejection of the award in the circuit court. In response, defendant filed a motion to debar GEICO's rejection of the award on the basis that GEICO failed to comply with defendant's Rule 237 notice. On January 8, 2002, the court granted defendant's motion to debar. Thereafter, the court entered judgment on the arbitration award in favor of GEICO and against defendant in the amount of $0.
GEICO then filed a motion to reconsider the court's debarment of GEICO's rejection and judgment on the award. A hearing was held on the motion to reconsider and the court denied GEICO's motion.
Plaintiff first claims that it should not have been debarred from rejecting the arbitration award because it substantially complied with Supreme Court Rule 237. While plaintiff did not bring it's "claim adjuster with the entire claim file" to the hearing as required by defendant's notice, GEICO asserts that "the circumstances of this case do not warrant such a [sic] extreme result- in essence, a $17,081.70 sanction-merely because GEICO did not bring a total loss adjuster to testify on its behalf at arbitration, while both counsel and subrogor did appear."
Supreme Court Rule 237(b) states in pertinent part:
"The appearance at the trial of a party or a person who at the time of trial is an officer, director, or employee of a party may be required by serving the party with a notice designating the person who is required to appear. The notice also may require the production at the trial of the original of those documents or tangible things * * *. Upon a failure to comply with the notice, the court may enter any order that is just, including any order provided for in Rule 219(c) that may be appropriate." 166 Ill. 2d R. 237(b).
Supreme Court Rule 90(g) provides that Rule 237 is equally applicable to arbitration hearings as to trials and also provides that failure to comply with a Rule 237(b) notice may include an order debarring that party from rejecting the arbitration award. 166 Ill. 2d R. 90(g).
Sanctions for failing to comply with a Rule 237 notice are to be imposed when failure to comply is determined to be unreasonable. Hawkins v. Wiggins, 92 Ill. App. 3d 278, 282, 415 N.E.2d 1179 (1980). The trial court's decision to bar a party from rejecting an arbitration award is within the sound discretion of the trial court and will not be disturbed on review absent an abuse of discretion. Williams v. Dorsey, 273 Ill. App. 3d 893, 901, 652 N.E.2d 1286 (1995). An abuse of discretion "occurs when the court rules arbitrarily or when its ruling 'exceed[s] the bounds of reason.' " Williams, 273 Ill. App. 3d at 901 quoting In re Marriage of Malters, 133 Ill. App. 3d 168, 180, 478 N.E.2d 1068, 1076 (1985). In addition, the burden is on the offending party to show that its noncompliance with a Rule 237 notice was reasonable or the result of extenuating circumstances. Kubian v. Labinsky, 178 Ill. App. 3d 191, 197, 533 N.E.2d 22 (1988).
Plaintiff argues that the ruling in State Farm Insurance Co., v. Rodrigues, 324 Ill. App. 3d 736, 756 N.E.2d 359 (2001), is dispositive of it's claim that the failure to comply with a Rule 237(b) notice was not unreasonable. In that case, State Farm filed a subrogation action against defendant Rodrigues for damaging the vehicle of it's insured, Pisarski. It was alleged that defendant struck and damaged Pisarski's parked and unoccupied vehicle. Counsel for State Farm appeared at the arbitration hearing but Pisarski did not and the hearing proceeded without her. The arbitrators entered an award for plaintiff and against defendant, but did not make a finding that plaintiff had failed to participate in good faith. Thereafter, defendant rejected the arbitration award. Subsequently, the trial court entered judgment for defendant and an order barring plaintiff from presenting evidence at trial as plaintiff had not arbitrated in good faith. Plaintiff appealed and ...