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American Family Mutual Insurance Co. v. Tyler

Court of Appeals of Illinois, First District

November 22, 2016

AMERICAN FAMILY MUTUAL INSURANCE COMPANY, as Subrogee of Michael Gaffney, Plaintiffs-Appellants,
DAVID L. TYLER, CITY OF CHICAGO, and AIMAN R. ORTHMAN, Defendants, (City of Chicago, Defendant-Appellee).

         Appeal from the Circuit Court of Cook County No. 09 L 1068 Honorable Edward S. Harmening, Judge Presiding.

          JUSTICE MASON delivered the judgment of the court, with opinion. Justices Neville and Pierce concurred in the judgment and opinion.


          MASON, JUSTICE

         ¶ 1 American Family Mutual Insurance Company (American Family), as subrogee of its insured, Michael Gaffney, asserted claims against the City of Chicago and others arising out of the theft by fraud and ultimate recovery of Gaffney's vehicle. The trial court dismissed American Family's complaint as it pertained to the City, on the ground that the City was immune from suit under the Local Governmental and Governmental Employees Tort Immunity Act (Act) (745 ILCS 10/2-101 (West 2012)). We agree with the trial court and affirm.

         ¶ 2 On April 19, 2011, Gaffney agreed to sell his vehicle, a 2006 BMW 650i, to an individual named David Tyler. Tyler paid for the car with two cashier's checks written on Fifth Third Bank: one payable to the lienholder on the vehicle, BMW Financial Services Remarketing, Inc., and the other payable to TRKAM, LLC, a business owned by Gaffney that held title to the car. After receipt of the checks, Gaffney gave Tyler the keys to the car and on April 21, 2011, faxed Tyler a copy of the vehicle's registration.

         ¶ 3 The following day, Gaffney was informed by First Merit Bank, where he had deposited the check payable to TRKAM, that the check was counterfeit. Gaffney then contacted the Chicago police department to report his vehicle stolen and likewise advised American Family of the theft. His efforts to contact Tyler were unsuccessful.

         ¶ 4 On some later date unspecified in the record, Gaffney called the Chicago police department, presumably to determine if his vehicle had been recovered. Gaffney was informed that the car had been recovered, undamaged, and that the police had called the vehicle's "owner." When Gaffney indicated that he was the owner and had not received a call, he was referred to the 18th precinct. Gaffney went to the station and was told that the car had already been returned to the "owner."

         ¶ 5 Gaffney's car was ultimately recovered on January 4, 2012, during a routine traffic stop. At the time, the car was being driven by defendant Aiman Othman.

         ¶ 6 American Family filed suit on July 10, 2014. In its first amended complaint, in addition to claims against Tyler and Othman, American Family asserted a claim labeled "breach of bailment contract" against the City. American Family alleged that the City (i) "voluntarily received" Gaffney's vehicle, (ii) "intended to create a bailment, when it accepted and maintained exclusive control and possession" of the vehicle, and (iii) despite Gaffney's demand, failed to return to vehicle to its proper owner. American Family sought damages consisting of the amount it paid Gaffney for the loss ($11, 670) as well as the amount of Gaffney's deductible ($1000).

         ¶ 7 The City filed a motion to dismiss the complaint in which it asserted that the gist of American Family's claim was the City's negligence in failing to provide "adequate police protection or service" or a failure to "prevent, detect or solve crimes"-conduct for which the City is immune under the Act. In response, American Family insisted that its claim against the City was a "bailment contract claim" excluded from the Act's scope under section 2-101, which preserves claims asserting a public entity's liability based on contract. 745 ILCS 10/2-101(a) (West 2012). The City denied that a bailment existed, given the lack of mutual assent between it and Gaffney and that, at most, the complaint asserted a constructive bailment-a contract implied in law-which did not fall under the Act's exemption for contract claims.

         ¶ 8 The trial court agreed that a fair reading of American Family's claim against the City asserted the existence of a quasi-contract or a contract implied in law, but concluded that under Village of Bloomingdale v. CDG Enterprises, Inc., 196 Ill.2d 484, 500 (2001), the claim was not based on a "contract" for purposes of the Act's exemption for liability under a contract. The court concluded, therefore, that American Family's claim fell under the Act's immunity provisions and was barred. Following its ruling, given the pendency of claims against other defendants, the court entered a finding pursuant to Illinois Supreme Court Rule 304(a) (eff. Feb. 26, 2010), and this appeal followed.

         ¶ 9 A motion pursuant to section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2012)) "admits the legal sufficiency of the plaintiff's complaint, but asserts an affirmative defense or other matter that avoids or defeats the plaintiff's claim." Relf v. Shatayeva, 2013 IL 114925, ¶ 20; DeLuna v. Burciaga, 223 Ill.2d 49, 59 (2006). "Affirmative matter" includes any defense other than a negation of an essential allegation of plaintiff's cause of action. Kedzie & 103rd Currency Exchange, Inc. v. Hodge, 156 Ill.2d 112, 115 (1993). A municipality's assertion that it is immune from suit is an appropriate subject of a motion under section 2-619. Smith v. Waukegan Park District, 231 Ill.2d 111, 115 (2008); Brooks v. Daley, 2015 IL App (1st) 140392, ¶ 14. We review the trial court's ruling on a section 2-619 motion de novo. Smith, 231 Ill.2d at 115; DeLuna, 223 Ill.2d at 59.

         ¶ 10 The evolution of the Act was discussed by our supreme court in Village of Bloomingdale. In response to the judicial abolition of sovereign immunity, the legislature enacted the Act in 1965. Village of Bloomingdale, 196 Ill.2d at 489. The Act reflects the general principle that governmental entities are liable in tort, but that liability is limited by an "extensive list" of immunities defined by specific government functions. Id. The Illinois Constitution of 1970 again abolished sovereign immunity, "[e]xcept as the General Assembly may provide by law." Ill. Const. 1970, art. XIII, § 4. "Today, therefore, the tort liability of a local public entity or employee is expressly controlled both by the constitutional provision and by legislative prerogative as embodied in the [Act]." Village of Bloomingdale, 196 Ill.2d at 489. ¶ 11 As noted, the Act preserves a public entity's contractual liability: "Nothing in this Act affects the liability, if any, of a local public entity or public employee, based on: a) Contract ***." 745 ILCS 10/2-101(a) (West 2012).

         ¶ 12 American Family asserts here that its constructive bailment claim falls under the Act's exception for claims against governmental entities based on contract. Notwithstanding our supreme court's decision in Village of Bloomingdale, American Family, citing American Ambassador Casualty Co. v. City of Chicago, 205 Ill.App.3d 879 (1990), contends that its constructive bailment claim is the type of claim for ...

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