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[W] Maxit, Inc. v. Cleve

August 22, 2007; withdrawn September 27, 2007


Appeal from the Circuit Court Du Page County. No. 05-L-1058 Honorable Robert K. Kilander, Judge, Presiding.

The opinion of the court was delivered by: Justice O'malley

Published opinion

Defendants and counterplaintiffs (defendants) John and Kelley Van Cleve appeal the judgment of the circuit court of Du Page County granting plaintiff and counterdefendant (plaintiff) Maxit, Inc.'s motion for summary judgment and motion for judgment on the pleadings and denying their cross-motion for summary judgment. The trial court ruled that defendants released plaintiff from responsibility on a pending workers' compensation claim by signing a "Release of All Claims" that arose from defendants' claim against plaintiff's underinsured motorist policy. Defendants argue that the release released only the underinsured motorist claim and did not affect the workers' compensation claim. We agree and reverse.

On December 21, 2006, John Van Cleve was injured in a automobile accident. Apparently, another car caused John's vehicle to drive off the road. At the time of the accident, John was employed by plaintiff and was driving one of plaintiff's trucks during the scope and course of his employment with plaintiff. The accident caused an injury to John's back.

On May 16, 2002, John filed a workers' compensation claim against plaintiff with the Industrial Commission, case No. 02--WC--2517. Plaintiff admits that, at the time of the accident, it was not covered by a workers' compensation insurance policy.

Thereafter, John also made a claim under plaintiff's underinsured motorist insurance policy. In September 2004, defendants settled the underinsured motorist claim in exchange for a payment of $800,000. As part of the settlement transaction, defendants signed a document entitled "Release of All Claims." We reproduce the text of the release in its entirety:

"[1] FOR AND IN CONSIDERATION of the payment to us at this time of the sum of $800,000, Eight Hundred Thousand Dollars, the receipt of which is hereby acknowledged, we being of lawful age, do hereby release, acquit and forever discharge Maxit, Inc., Transportation Insurance Co, [sic] and their agents, servants, successors, heirs, executors, insurers, administrators, all other persons, firms, corporations, associations or partnerships ('Releasees') or [sic] and from any and all actions, causes of action, claims, demands, damages, costs, loss of services, expenses and compensation, on account of, or in any way growing out of, any and all known and unknown personal injuries and property damage resulting or to result from an accident that occurred on or about 12/26/2001, and covered by Underinsured Motorist policy provisions in Policy No. 1035982371.

[2] We hereby declare and represent that the injuries sustained are permanent and progressive and that recovery therefrom is uncertain and indefinite, and that in making this release and agreement it is understood and agreed that we rely wholly upon our own judgment, belief and knowledge of the nature, extent and duration of said injuries, with the advice of counsel and that we have not been influenced to any extent whatever in making this release by any representations or statements regarding said injuries, or regarding any other matters, made by the persons, firms or corporations who are hereby released, or by any person or persons representing him or them, or by any physician or surgeon by him or them employed.

[3] In consideration of the aforesaid payment, John Van Cleve and Kelley R. Van Cleve agree to indemnify and hold forever harmless, Releasees, their heirs, successors, administrators, insurers or assigns from and against any and all claims, rights, duties, obligations, debts, liabilities, liens or causes of action of any kind and nature whether foreseen, unforeseen, contingent or actual, liquidated or unliquidated that have been or may hereafter and any time be made or brought against the said Releasees for the purpose of enforcing a further claim for damage on account of the alleged damages or injury sustained in consequence of the aforesaid accident.

[4] It is further understood and agreed that this settlement is the compromise of a doubtful and disputed claim, and that the payment is not to be construed as an admission of liability on the part of the Releasees, by whom liability is expressly denied.

[5] We further agree that this release shall not be pleaded by us as a bar to any claim or suit.

[6] The undersigned acknowledge and agree that the aforesaid sum represent the full amount of damages due them according to the terms of Policy No. 1035982371 and further agree, in consideration of such payment, upon the Releasees [sic] request, to take such action as may be necessary to recover from the owner or operator of such underinsured automobile the damages suffered by the undersigned. In the event of a recovery, the Releasees shall be reimbursed out of such recovery to the extent of any payment made to the undersigned; and in addition, shall be reimbursed for expenses, costs and attorney's fees by it in connection with such action. under [sic]

[7] This release contains the ENTIRE AGREEMENT between the parties hereto, and the terms of this release are contractual and not a mere recital.

[8] We further state that we have carefully read the foregoing release and know the contents thereof, and we sign the same as our own free act." (Emphases in original.) Both defendants signed the document. Randall Taradash, defendants' attorney at that time, ...

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