from the Circuit Court of Cook County.No. 11 CH 10715
Honorable Kathleen M. Pantle, Judge Presiding.
HARRIS delivered the judgment of the court, with opinion.
Presiding Justice Connors and Justice Mikva concurred in
judgment and opinion.
JUSTICE HARRIS JUDGE.
1 This is an appeal regarding insurance coverage and the
notice clause of an uninsured motorist provision contained
within the policy. Plaintiff and counterdefendant-appellee,
Nancy Smith (hereinafter "Smith"), was a passenger
in an automobile involved in a hit-and-run accident where the
other vehicle could not be identified because it fled the
scene. The owner of the vehicle Smith rode in had a split
insurance policy. One company insured the collision portion,
and defendant/counterplaintiff-appellant, American Heartland
Insurance Company (hereinafter "Heartland"),
insured the liability portion. Heartland denied her claim
based on the failure to comply with the notification
requirement found in the hit-and-run coverage, and Smith
filed this declaratory judgment action.
2 After conducting discovery, both parties moved for summary
judgment. Heartland argued it was undisputed that Smith
failed to provide written notification of her claim within
120 days of the accident as required by the policy. In her
motion for summary judgment, Smith argued her notice was
reasonable under the circumstances and, alternatively, the
notice provision violated the public policy of Illinois. The
circuit court denied both motions after concluding there were
genuine issues of material fact that needed to be resolved
and proceeded to trial. After trial, the court concluded that
it could not enforce the 120-day provision because it
"may" violate the public policy of Illinois. The
circuit court concluded that the standard to be applied was
whether notice was reasonable. Based on the testimony and
evidence before it, the court entered judgment for Smith,
finding her notice to be reasonable.
3 On appeal, Heartland argues that (1) the circuit court
erred in denying its motion for summary judgment; (2) the
circuit court erred in finding the 120-day notice provision
ambiguous and applying reasonableness factors to find notice
timely; and (3) the notice provision does not violate the
public policy of Illinois. For the reasons set forth below,
we affirm the circuit court in denying summary judgment and
proceeding to trial. We find that the notice provision is not
ambiguous; however, despite this, we conclude the
reasonableness factors found in Country Mutual Insurance
Co. v. Livorsi Marine, Inc., 222 Ill.2d 303, 313 (2006),
represent suitable guidelines in determining whether a notice
provision violates public policy. We conclude that, when
applied to the facts and circumstances of this case, the
notice provision violates the public policy of Illinois
regarding uninsured motorist benefits. Accordingly, we affirm
the entry of judgment in favor of Smith.
5 On March 25, 2016, the circuit court entered a final
judgment in favor of Nancy Smith, and against American
Heartland Insurance and Octavia Pearson. On April 22, 2016,
defendants filed their notice of appeal. Accordingly, this
court has jurisdiction over this matter pursuant to Article
VI, Section 6 of the Illinois Constitution, and Illinois
Supreme Court Rules 301 and 303. Ill. Const. 1970, art. VI,
§ 6; Ill. S.Ct. R. 301 (eff. Feb. 1, 1994); Ill. S.Ct.
R. 303 (eff. May 30, 2008).
7 On March 1, 2010, Octavia Pearson (hereinafter "the
insured") was driving her car with Smith and Derrick
Rodgers as passengers when it was struck by a hit and run
driver in Chicago, Illinois. The insured obtained her
insurance policy through an insurance broker doing business
as "Insure On The Spot." The insurance provided to
her was in the form of a split policy with two insurance
companies providing different coverage. American Freedom
Insurance Company provided comprehensive/collision coverage,
while Heartland provided liability coverage and the uninsured
motorist coverage at issue in this case. At the time of the
accident, the insured had not received any insurance policy
and only had her insurance card from Insure On The Spot.
8 At the scene of the collision, the insured called the
police, who arrived shortly thereafter and prepared a police
report of the incident. The police report listed the
insured's insurance company as Insure On The Spot.
Following her interaction with the police, the insured called
Insure On The Spot. The insurance card the insured possessed
displayed both insurance companies but did not state which
insurance company issued the comprehensive/collision coverage
or the liability/uninsured motorist coverage.
9 On March 2, 2010, Smith went to a hospital emergency room
and initiated treatment for injuries she alleged were caused
by the March 1, 2010 accident. Thereafter, Smith retained the
services of attorneys, and based on the information Smith
alleged she obtained from the insured, her attorney sent an
Attorney's Lien and Notice to American Freedom Insurance
Company on March 8, 2010. Receiving no response, on June 29,
2010, a second notice was sent to American Freedom. On July
9, 2010, Smith's attorney was notified by American
Freedom that it carried only comprehensive/collision on the
insured's vehicle and liability coverage was written by
10 On July 9, 2010, Smith's counsel, Barry Weiss,
reported by telephone to Heartland that Smith claimed she was
injured in the March 1 accident. The insured gave a telephone
statement to Heartland on July 16, 2010 that a hit and run
accident had occurred. On September 9, 2010, Smith's
attorney sent a letter to Heartland, informing it of
Smith's uninsured motorist claim. In a letter dated
September 14, 2010, Juliette Driscoll, a claims adjuster for
Heartland, requested that Smith's counsel provide
Heartland with Smith's medical damages.
11 On February 11, 2011, Heartland sent Smith's attorney
a letter, denying her uninsured motorist claim, because the
written notice of her claim was not sent within 120 days of
the incident as stated in the insured's policy. After
receipt of the denial, Smith filed this declaratory judgment
action against Heartland and the insured, seeking an order
that Heartland was obligated to cover her claim. The parties
then conducted discovery, and each party eventually filed
motions for summary judgment. On March ...