Appeal from the Circuit Court of Cook County. Honorable Sophia H. Hall, Judge Presiding.
The opinion of the court was delivered by: Justice Wolfson
Plaintiff Evelyn Watkins bought a car financed by GMAC Financial Services ("GMAC") and an insurance policy from National Heritage Insurance Company ("National") for the car. The car was stolen and damaged.
When National did not offer to pay for the loss, Watkins retained an attorney, Jared B. Staver, under a contingency fee agreement. Staver secured a lien on any proceeds from National under the Attorney's Lien Act, 770 ILCS 5/1 (West 2000). Staver then reached a settlement in which National agreed to pay for the loss of the car in return for the title. When Staver contacted GMAC about its share of the settlement and release of the title, GMAC refused to release the title and endorse the settlement draft. GMAC contended it was entitled to all the insurance proceeds and was not required to release the title to the car.
Watkins then sued GMAC and National to determine the parties' rights to the settlement money and for breach of contract. Watkins and GMAC filed cross-motions for summary judgment. The court denied Watkins' motion and granted GMAC's motion on all counts. Watkins appeals the trial court's decision. We affirm.
On August 31, 1999, Watkins entered into a contract with GMAC. Under the contract, GMAC financed Watkins' purchase of a car. The contract contains, among other things, provisions allowing Watkins to prepay any portion of the loan and providing that GMAC may use insurance proceeds to reduce the amount Watkins owes:
"You can prepay all of your debt and get a refund of part of the Finance Charge.
If the vehicle is lost or damaged, you agree that the Creditor may use any insurance settlement to reduce what you owe or repair the vehicle."
The contract also contains the following provision providing GMAC with a security interest in the proceeds of insurance policies:
"You give the Creditor a security interest in *** any proceeds of insurance policies or service contracts on the vehicle."
The title for the car, which was issued on October 22, 1999, shows GMAC is a lien holder.
In September 1999, Watkins purchased an automobile insurance policy for the car. The declarations page of the policy states, "LOSS PAYEE: ANY LOSS IS PAYABLE AS INTEREST MAY APPEAR TO THE NAMED INSURED AND *** [GMAC]."
On January 30, 2001, Watkins' car was stolen and damaged beyond repair. Despite receiving notice of the loss, National did not offer to pay under the policy. On April 4, 2001, Watkins retained Staver to represent her in her claim against National pursuant to a one-third contingency fee arrangement. On April 5, 2001, Staver sent to National notice of his lien on any proceeds under the Attorney's Lien Act, and a demand to settle the claim for the total loss of the car.
On April 19, 2001, Staver reached a lump sum settlement with National for $11,437.35, the total loss of the car. National agreed to send a settlement draft to Staver in that amount made payable to Watkins, ...