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St. Paul Fire and Marine Insurance Co. v. The City of Waukegan

Court of Appeals of Illinois, Second District

August 1, 2017


         Appeal from the Circuit Court of Lake County. No. 15-MR-289 Honorable Thomas M. Schippers, Judge, Presiding.

          JUSTICE BIRKETT delivered the judgment of the court, with opinion. Justices Hutchinson and Zenoff concurred in the judgment and opinion.



         ¶ 1 Defendants, the City of Waukegan and former Waukegan police officers Lucian Tessmann, Donald Meadie, Fernando Shipley, Richard Davis, Terry House, Robert Repp, Burton Setterlund, and Phillip Stevenson and Maria LaCour (as representatives of deceased Waukegan police officers Dennis Cobb and Howard Pratt) (collectively, the City), appeal from the trial court's order granting summary judgment in favor of plaintiffs, St. Paul Fire and Marine Insurance Company and Travelers Indemnity Company (collectively, the insurers) and denying the City's motion for judgment on the pleadings. For the following reasons, we affirm.

         ¶ 2 I. BACKGROUND

         ¶ 3 The record reflects that Juan Rivera, the plaintiff in the underlying wrongful conviction case, was arrested and charged with the rape and murder of 11-year-old Holly Staker in 1992. Rivera's arrest came after he confessed following four days of intense questioning. Rivera's confession was introduced into evidence by the State at his 1993 trial, after which he was found guilty and sentenced to natural life in prison. In November 1996, this court reversed Rivera's conviction due to numerous trial errors but upheld the trial court's order denying Rivera's motion to suppress that alleged that his confession was coerced. People v. Rivera, No. 2-94-0075 (1996) (unpublished order pursuant to Illinois Supreme Court Rule 23).

         ¶ 4 Rivera was retried in 1998. The State once again introduced the confession through the testimony of Waukegan police officers. Rivera was again convicted and sentenced to natural life in prison. On appeal, this court affirmed the conviction. People v. Rivera, 333 Ill.App.3d 1092 (2001). Following Rivera's second conviction, DNA testing excluded Rivera as the source of the semen found in the victim. Rivera then filed a petition for relief from judgment pursuant to section 2-1401 of the Code of Civil Procedure (735 ILCS 5/2-1401 (West 2006)). The trial court granted the petition and ordered a new trial.

         ¶ 5 The State elected to try Rivera for a third time, and the trial commenced in May 2009. Rivera's confession was again presented through the testimony of Waukegan police officers. Again, Rivera was convicted and sentenced to natural life imprisonment. This court reversed Rivera's conviction. People v. Rivera, 2011 IL App (2d) 091060. On January 6, 2012, Rivera was released from prison. On October 30, 2012, Rivera filed a federal wrongful conviction complaint against numerous defendants, including the City of Waukegan and the police officers named in this coverage suit.

         ¶ 6 Rivera's lawsuit alleged various civil rights violations and common-law tort claims relating to his arrest, conviction, and 20-year imprisonment. Rivera v. Lake County, Illinois, et al., No. 12-CV-8665 (Cir. Ct. Lake Co.). His third amended complaint contained 13 counts and sought compensatory and punitive damages as well as attorney fees and costs against the City. In the first six counts of the complaint, Rivera alleged violations of section 1983 of the United States Code (42 U.S.C. § 1983 (2012)): (1) the confession was both coerced and false, which resulted in a violation of his fifth amendment rights (Rivera alleged that the confession was the only reason that he was prosecuted and convicted); (2) the confession was both coerced and false, which resulted in a violation of his fourteenth amendment rights; (3) federal malicious prosecution;[1] (4) due process violations based upon an allegation that police officers withheld exculpatory evidence from the prosecution; (5) conspiracy to deprive him of his constitutional rights; and (6) failure to intervene.

         ¶ 7 The next six counts in the complaint were based upon state law: (7) malicious prosecution (defendants "accused Plaintiff of criminal activity and exerted influence to initiate and continue and perpetuate judicial proceedings against Plaintiff without any probable cause for doing so and in spite of the fact that they knew Plaintiff was innocent"); (8) intentional infliction of emotional distress; (9) civil conspiracy; (10) defamation; (11) respondeat superior; and (12) indemnification. Finally, count XIII was also brought pursuant to section 1983, and in it Rivera alleged a conspiracy to deny access to the courts.

         ¶ 8 The record reflects that the insurers provided the City with a series of one-year primary and umbrella law enforcement liability policies covering the period from November 1, 2006, through November 1, 2010. Travelers provided the City with similar primary and umbrella coverage for the period from November 1, 2010, through November 1, 2011. The City tendered the Rivera complaint to the insureds for defense and indemnification. On February 24, 2015, the insureds filed this action and sought a declaratory judgment pursuant to section 2-701 of the Code of Civil Procedure (735 ILCS 5/2-701 (West 2014)). The insurers alleged that they had no duty to defend or indemnify any of the defendants in the Rivera wrongful conviction lawsuit. While this coverage suit was pending, the Rivera lawsuit settled for $20 million. See In re Marriage of Rivera, 2016 IL App (1st) 160552, ¶ 4. According to a letter from counsel for the City to counsel from Travelers, the City agreed to pay its share ($7.5 million) to Rivera in exchange for the dismissal with prejudice of all claims.

         ¶ 9 The insurers' complaint for declaratory judgment alleged that the policies issued to the City did not provide coverage, because the policies' coverage was triggered only by injury or damage that happened while the policies were in effect. They argued that Rivera's injuries, as alleged in his complaint, occurred in 1992 when he was coerced into providing a false confession and in 1993 when he was tried and convicted.

         ¶ 10 In its pleadings, the City alleged that the 2008-09 law enforcement liability policies were triggered by "wrongful acts" that occurred during Rivera's third trial, specifically, the use of Rivera's coerced confession in violation of the fifth amendment and suppression of exculpatory evidence pursuant to Brady v. Maryland, 373 U.S. 83 (1963).

         ¶ 11 The parties agree that the policies at issue are the November 1, 2008, to November 1, 2009, primary and umbrella law enforcement liability (LEL) policies, which were in effect during Rivera's third trial.

         ¶ 12 The relevant policy terms are stated in the "Law Enforcement Liability Protection" section of the 2008-09 primary policy, as modified by a "Law Enforcement Liability Self-Insured Retention Endorsement." The section provides, in pertinent part:

"Law Enforcement Liability. We'll pay amounts any protected person is legally required to pay as damages for covered injury or damage that:
*results from law enforcement activities or operations by or for you;
*happens while this agreement is in effect; and
*is caused by a wrongful act that is committed while conducting law enforcement activities or operations.
** *
Injury or damage means bodily injury, personal injury, or property damage.
** *
Personal injury means injury, other than bodily injury, caused by any of the following wrongful acts:
*False arrest, detention, or ...

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