2014 IL App (1st) 133771
Ill. App. Ct.2015Background
- ASI issued a commercial auto policy to Car Service Company, Inc. (CSC) providing $500,000 single-limit liability and $20,000/$40,000 uninsured/underinsured motorist (UM/UIM) limits; CSC signed a written election rejecting higher UM/UIM limits during renewal (Dec. 30, 2008).
- While driving for CSC in Feb. 2009, Iouri Iousoupov (driver) was injured in a collision with an Allstate-insured driver whose liability limits were $50,000; Iousoupov sought UIM benefits from ASI, which denied coverage.
- ASI sued for declaratory judgment that no UIM coverage was available because CSC had validly rejected higher UM/UIM limits; Iousoupov challenged the validity/adequacy of the election form and sought arbitration and litigation in other fora.
- Record includes deposition testimony from CSC president (Hodjaeva) acknowledging she signed the election rejecting higher limits and that coverage options were explained orally by agent Kropp; ASI underwriting witnesses explained the form’s intended use and that insurers issue higher UM/UIM unless a rejection form is received.
- The trial court struck portions of expert and some deposition testimony, found the election form not ambiguous and that CSC knowingly rejected higher limits, granted ASI summary judgment, and this appeal followed.
Issues
| Issue | Plaintiff's Argument (ASI) | Defendant's Argument (Iousoupov) | Held |
|---|---|---|---|
| Validity of election form under 215 ILCS 5/143a-2 (brief description requirement) | Election form satisfied statutory "brief description" and right-to-reject; oral explanation by agent reinforces validity. | Form is ambiguous, incomplete, and fails to briefly describe UM/UIM (missing rates, unclear terms), so statutory requirements not met. | Form was not ambiguous; it provided a sufficient brief description and right-to-reject; therefore valid. |
| Effect of signed rejection form | The signed election (or its copy) is sufficient evidence under §143a-2(3) to bind insured and limit UM/UIM to statutory minimums. | Even if signed, the form is defective and cannot operate to reduce statutorily mandated coverage. | Signature of CSC president on the rejection form was sufficient; CSC knowingly rejected higher limits, binding on insureds. |
| Whether UIM is triggered when tortfeasor's limits ($50,000) exceed UM/UIM ($20k/$40k) | UIM not triggered because tortfeasor’s liability limits exceed insurer's UM/UIM limits. | Contends UM/UIM should be higher (equal to $500k) because election form defective. | UIM not triggered; tortfeasor’s $50,000 > ASI’s $20k UIM, so no UIM recovery. |
| Admissibility of expert and deposition evidence (striking Leatzow affidavit, Pitalis testimony, parts of Giles) | Court should strike expert statutory-interpretation testimony and irrelevant post-remedial statements; those were legal conclusions or post-remedial. | Such evidence was admissible to create factual disputes on form adequacy and agent practices. | Court properly struck expert legal-opinion testimony and irrelevant post-remedial remark; exclusion did not change outcome. |
Key Cases Cited
- DeGrand v. Motors Ins. Corp., 146 Ill. 2d 521 (1992) (insured bears burden to reject higher UM coverage; insurer need not "offer" higher limits)
- Lee v. John Deere Ins. Co., 208 Ill. 2d 38 (2003) (when UM exceeds statutory minimum, UIM is set equal to UM limits)
- Home Ins. Co. v. Cincinnati Ins. Co., 213 Ill. 2d 307 (2004) (summary judgment review and contractual interpretation standards)
- Outboard Marine Corp. v. Liberty Mut. Ins. Co., 154 Ill. 2d 90 (1992) (summary judgment is reviewed de novo; grant only where no triable issues)
- LID Assocs. v. Dolan, 324 Ill. App. 3d 1047 (2001) (experts cannot give testimony amounting to statutory interpretation or legal conclusions)