Farmers Automobile Insurance Ass'n v. Burton
2012 IL App (4th) 110289
Ill. App. Ct.2012Background
- Buckley sued Burton for death-causing hit-and-run (May 11, 2008); Buckley served June 7, 2010.
- Farmers insured Burton; Farmers filed declaratory judgment Sept. 2010 arguing Burton failed to give prompt notice.
- Burton notified Farmers July 8, 2010, after arrest and criminal charges (June 2010 conviction).
- Policy requires prompt notice of accident; duty to defend/indemnify conditioned on covered notice.
- Trial court granted summary judgment for Farmers; appeals consolidated and affirm the judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was Burton's late notice reasonable under the policy terms? | Farmers; delay of ~11 months after arrest was unreasonable. | Burton; claimed innocence excuses notice delay. | Yes; notice not reasonable; summary judgment for Farmers affirmed. |
| Does the policy notice provision require notice regardless of criminal proceedings? | Notice is a prerequisite to coverage; delay prejudices insurer. | Innocence negates duty to notify until served. | Notice required; delay violated policy terms. |
| Did Burton’s arrest/arising criminal case trigger a duty to notify? | Arrest for hit-and-run placed insured on notice of potential liability; obligation to notify. | Arrest does not necessarily equal accident or loss; no duty until awareness of event. | Arrest for hit-and-run triggered duty to notify; late notification breached policy. |
Key Cases Cited
- Barrington Consolidated High School v. American Insurance Co., 58 Ill. 2d 278 (Ill. 1974) (notice provisions are reasonable policy requirements; prerequisites to coverage)
- Livorsi Marine, Inc. v. Livorsi, 222 Ill. 2d 303 (Ill. 2006) (breach of notice defeats coverage; factors for reasonable notice; prejudice not sole determinant)
- West American Insurance Co. v. Yorkville National Bank, 238 Ill. 2d 177 (Ill. 2010) (enumerates factors for determining reasonable notice including prejudice)
- American Country Insurance Co. v. Bruhn, 289 Ill. App. 3d 241 (Ill. App. 2d Dist. 1997) (fear of criminal prosecution does not excuse failure to give notice)
- American Standard Insurance Co. of Wisconsin v. Slifer, 395 Ill. App. 3d 1056 (Ill. App. 4th Dist. 2009) (insurer’s duty not excused by insured’s innocence; notice requirement remains)