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Seymour v. Collins

Court of Appeals of Illinois, Second District

September 29, 2014

TERRY L. SEYMOUR and MONICA SEYMOUR, Plaintiffs-Appellants,
v.
BRADLEY A. COLLINS, ROCKFORD COUNTRY CLUB, ATS MEDICAL SERVICES, INC., SHAUN P. BRANNEY, and LEO J. VERZANI, Defendants-Appellees

Page 675

Appeal from the Circuit Court of Winnebago County. No. 11-L-172. Honorable J. Edward Prochaska, Judge, Presiding.

SYLLABUS

The trial court properly entered summary judgment for defendants in plaintiffs' action for negligence and loss of consortium arising from an automobile accident on the ground that plaintiffs were barred by the doctrine of judicial estoppel from proceeding with their claims, since the plaintiffs had previously filed a chapter 13 bankruptcy petition, and although their chapter 13 plan was modified several times, it was still in effect at the time of the accident, but despite their obligation to report to the bankruptcy court financial changes that might affect their plan, plaintiffs failed to inform the bankruptcy court of their personal injury claims, they took inconsistent positions in the bankruptcy proceedings and the personal injury action, they intended the bankruptcy court to believe the facts alleged in the bankruptcy proceedings, and they benefitted in the bankruptcy proceedings by having their plan proceed to a discharge without their creditors being informed of the personal injury claims and possibly seeking a modification of the plan or filing some other objection.

William T. Cacciatore and Eileen J. McCabe, both of Cacciatore Law Offices, of Rockford, for appellants.

Jeffrey J. Zucchi, of Clark, Justen, Zucchi & Frost, Ltd., of Rockford, for appellee Bradley A. Collins.

Lori E. McGirk, of Guyer & Enichen, P.C., of Rockford, for appellee Rockford Country Club.

JUSTICE HUDSON delivered the judgment of the court, with opinion. Justice Zenoff concurred in the judgment and opinion. Justice Schostok dissented, with opinion.

OPINION

HUDSON, JUSTICE.

Page 676

[¶1] Plaintiffs, Terry L. Seymour and Monica Seymour, appeal from an order of the circuit court of Winnebago County applying the doctrine of judicial estoppel and granting summary judgment to defendants, Bradley A. Collins, the Rockford Country Club, ATS Medical Services, Inc., Shaun P. Branney, and Leo J. Verzani.

Page 677

Because the trial court properly applied the doctrine of judicial estoppel, we affirm.

[¶2] I. BACKGROUND

[¶3] On May 20, 2011, plaintiffs filed a 16-count second amended complaint alleging negligence and loss of consortium arising out of a June 3, 2010, traffic accident. The accident involved a vehicle driven by Collins, an employee of the Rockford Country Club, and an ambulance owned by ATS, which was being operated by Branney and Verzani and transporting Terry.

[¶4] Previously, on April 24, 2008, plaintiffs filed a petition for chapter 13 bankruptcy (11 U.S.C. § 1301 (2006)) in the United States District Court for the Northern District of Illinois. A chapter 13 plan was confirmed on September 19, 2008, and was modified on January 30, 2009, and February 4, 2009.

[¶5] In May 2009, Terry was injured at work. On February 25, 2010, plaintiffs filed a motion to modify the chapter 13 plan because Terry was unable to work and was receiving workers' compensation payments. The plan was modified on March 19, 2010, lowering plaintiffs' payments.

[¶6] On June 3, 2010, Terry was injured while working for a new employer. It was that injury that resulted in his being transported in the ambulance when the accident underlying plaintiffs' lawsuit occurred. On June 8, 2010, he filed a workers' compensation claim related to that injury.

[¶7] On September 18, 2010, and June 20, 2011, plaintiffs filed change-of-address forms with the bankruptcy court. On June 29, 2012, the trustee filed a notice of completion of the payment plan. On July 17, 2012, plaintiffs were granted a discharge in bankruptcy.

[¶8] Defendants moved for summary judgment in the personal injury case. They contended that plaintiffs should be judicially estopped from proceeding with their claims, because they failed to disclose their personal injury action in the bankruptcy proceeding.

[¶9] Plaintiffs responded that judicial estoppel did not apply, because: they did not assert under oath in the bankruptcy proceeding that they did not have a pending personal injury case; they did not intentionally fail to disclose the claims; and they did not obtain a benefit in the bankruptcy proceeding by failing to disclose the claims. In support of their response, they submitted their own affidavits, an affidavit of the chapter 13 trustee, Lydia Meyer, and an affidavit of their bankruptcy attorney, Jeffrey Dahlberg.

[¶10] According to plaintiffs' affidavits, Meyer advised them at a bankruptcy meeting that they were required to report to her and Dahlberg " any lump sum funds received in excess of $2,000." Dahlberg stated in his affidavit that Meyer " advises [d]ebtors at their 341 meeting that they are required to report to their attorney and [her] any lump sum funds received in excess of $2,000."

[¶11] Meyer stated in her affidavit that all debtors are required to report to her, through their attorney, " any and all cash or monies received during the chapter 13 bankruptcy proceeding other than the income listed on the debtors' Schedule I."

[¶12] The trial court conducted a hearing on the motion for summary judgment. Plaintiffs presented arguments as to why judicial estoppel did not apply. The court stated that it considered plaintiffs' arguments as well as the affidavits they submitted. The court concluded by stating that it was going to " review the cases that [the parties] cited, [and] the exhibits" and that it had " looked at it all, but [it] wanted to look at it all again."

Page 678

[¶13] The trial court issued a written order granting summary judgment. The court stated that it had reviewed the " [m]otion, briefs, affidavits, exhibits, relevant case law, and *** arguments." The court specifically referred to the affidavits of Meyer and Dahlberg. The court found that it was undisputed that plaintiffs never amended their bankruptcy schedules or their statement of financial affairs to disclose the June 3, 2010, work-related injury, the related ambulance accident, or their personal injury case.

[¶14] Citing People v. Runge, 234 Ill.2d 68, 917 N.E.2d 940, 334 Ill.Dec. 865 (2009), the trial court set out the five elements of judicial estoppel. The court ruled that plaintiffs had a duty to disclose their pending personal injury lawsuit even if it arose after the plan confirmation and even if they had not yet received a money judgment. The court ruled that the failure to do so " support[ed] a finding of judicial estoppel." Therefore, the court granted summary judgment in favor of all defendants and dismissed the case. Plaintiffs filed a timely appeal.

[¶15] II. ANALYSIS

[¶16] On appeal, the parties initially dispute the proper standard of review. Plaintiffs contend that the standard of review is de novo, because the trial court granted a motion for summary judgment. Defendants respond that the standard should be abuse of discretion, notwithstanding the granting of a motion for summary judgment, because the ...


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