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Barnes v. Lolling

Court of Appeals of Illinois, Third District

June 27, 2017

JERRY L. BARNES Plaintiff-Appellant,
v.
DANIEL R. LOLLING and UNITED CONTRACTORS MIDWEST, INC., Defendants-Appellees.

         Appeal from the Circuit Court of the 9th Judicial Circuit, Fulton County, Illinois Circuit No. 13 L 18 The Honorable Steven R. Bordner, Judge, Presiding.

          PRESIDING JUSTICE HOLDRIDGE delivered the judgment of the court, with opinion. Justices McDade and Schmidt concurred in the judgment and opinion.

          OPINION

          HOLDRIDGE, PRESIDING JUSTICE

         ¶ 1 Plaintiff Jerry L. Barnes, a former bankruptcy debtor, sued defendants Daniel R. Lolling (Lolling) and his employer, United Contractors Midwest, Inc. (United Contractors), for personal injuries Barnes allegedly sustained during an automobile accident. The accident took place on October 7, 2011, after Barnes had filed her Chapter 13 bankruptcy petition and while the bankruptcy proceeding was pending. Barnes did not disclose her potential cause of action against the defendants to the bankruptcy trustee or schedule the cause of action as an asset of the bankruptcy estate. Barnes filed the instant personal injury claim on October 7, 2013, two years after the accident and approximately five months after the bankruptcy court had discharged Barnes's debts and closed the bankruptcy case.

         ¶ 2 The defendants moved for summary judgment, arguing that: (1) Barnes's personal injury claim was barred under the doctrine of judicial estoppel because Barnes failed to disclose the claim during the bankruptcy proceedings; and (2) Barnes lacked standing to sue because the personal injury action accrued while the bankruptcy case was pending and was therefore the property of the bankruptcy estate. The trial court ruled that the elements of judicial estoppel had been met and granted summary judgment for the defendants on that basis. This appeal followed.

         ¶ 3 FACTS

         ¶ 4 On February 8, 2008, Barnes and her husband filed for Chapter 13 bankruptcy protection to resolve their personal and business debt. Barnes completed an individual debtor petition in her name and provided all the required information. She appeared in bankruptcy court on only one occasion at the beginning of the case. Sometime in 2008, the bankruptcy court placed Barnes and her husband on a five-year debt repayment plan. Barnes and her husband made payments of $500 per month under the plan until they received a discharge from bankruptcy on April 11, 2013. During that five-year period, Barnes did not file any bankruptcy pleadings, seek any modifications to the repayment plan, or inform the bankruptcy court of any new assets, liabilities, or diminished earnings.

         ¶ 5 The bankruptcy court discharged Barnes's debt and closed the bankruptcy case in April 2013. The Trustee's Final Report and Account showed that, over a period of approximately five years, Barnes paid a total of $30, 000 to her creditors. Barnes had $92, 164.70 in unsecured debt discharged in bankruptcy.

         ¶ 6 On October 7, 2011, approximately 18 months prior to the discharge of her bankruptcy, Barnes was involved in a motor vehicle accident with the defendant, Daniel Lolling. At the time of the accident, Lolling was purportedly working within the scope of his employment with the defendant, United Contractors. Barnes retained counsel to prosecute her personal injury claims of negligence against Lolling and United Contractors. Eighteen days after the accident, Barnes's counsel wrote to the defendants' insurer stating that: (1) he would be representing Barnes in her claim for personal injuries against Lolling and United Contractors; and (2) he anticipated that Barnes's damages from the accident "could easily exceed $50, 000" in medical bills "plus lost wages." The defendants disagreed with Barnes' allegations, disputed her claim that Lolling was negligent, and denied liability.

         ¶ 7 On October 7, 2013, six months after the bankruptcy discharge and two years after the accident, Barnes filed the instant personal injury action against Lolling and United Contractors.[1]In her complaint, Barnes alleged that, as a result of the accident, she had suffered severe injuries, incurred medical expenses, and had lost the capacity to earn sums of money in the future that she would have been able to earn had it not been for the accident. She claimed damages in excess of $50, 000. On November 22, 2013, the defendants filed an answer to Barnes's complaint in which they denied liability for the accident and asserted an affirmative defense of contributory negligence against Barnes. Barnes filed a timely answer to the affirmative defense in which she denied contributory negligence.

         ¶ 8 At the conclusion of discovery, the defendants moved for summary judgment on two grounds. First, the defendants argued that Barnes lacked standing to bring the suit because the personal injury claim had accrued before the bankruptcy proceedings were closed and was therefore the property of the bankruptcy estate. Second, the defendants argued that Barnes's claim was barred under the doctrine of judicial estoppel because Barnes had failed to disclose the claim as a potential asset during the bankruptcy proceedings.

         ¶ 9 Barnes responded to the defendants' summary judgment motion, attaching a supporting affidavit. In her sworn affidavit, Barnes asserted (inter alia) that: (1) she did not inform the attorney representing her in the personal injury action that she had previously filed a Chapter 13 bankruptcy petition and was making monthly payments as required by the bankruptcy plan; (2) she did not know that she had a duty to report the automobile accident to the bankruptcy court; (3) as a result, she did not report the automobile accident to the bankruptcy court or inform her bankruptcy attorney of the accident; (4) she did not file any documents in the bankruptcy court after the accident; and (5) she did not intend to deceive the bankruptcy court.

         ¶ 10 The trial court granted summary judgment in favor of the defendants on the basis of judicial estoppel. The court's written order states:

"Cause coming on for hearing defendants' motion for summary judgment, parties appearing by counsel and [Barnes] appearing in person, in the court hearing argument, it is ordered that the elements of judicial estoppel are met, and ...

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