2015 IL App (1st) 141724
Ill. App. Ct.2016Background
- Office Furnishings (plaintiff) leased a Bellwood warehouse since 1993; Brathan Property (owner) purchased the building in 2000. Significant PVC roof problems were documented by contractors in 2000–2001, recommending replacement, but plaintiff’s principal (Meyers) denied knowledge of those reports.
- Meridian cancelled plaintiff’s property insurance in August 2002 after loss history. Jim Werner (insurance producer, through Crissie) sought replacement coverage and sent an ACORD application to multiple carriers; American Family eventually agreed through agent Joe Kobel.
- At a December 2002 meeting, Kobel completed American Family’s application (which listed the roof as 5 years old and omitted Brathan as an additional insured). Werner attended but did not review the signed application.
- On January 31, 2003, a major roof leak caused over $1 million in damage. American Family denied the claim, citing material misrepresentations on the application.
- Plaintiff and Brathan sued Werner/Crissie for professional negligence; a jury awarded plaintiff $467,721.50. The trial court granted defendants’ motion for judgment n.o.v., finding Werner had no duty to verify or review the application, and plaintiff appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Werner owed a duty to verify or review the insurer’s application answers | Werner’s conduct in obtaining replacement coverage, arranging and attending the application meeting, and offering to fix policy errors created a duty to verify and review accuracy; breach was a jury question | Producer’s statutory/common-law duty is limited to exercising ordinary care to procure requested coverage; no duty to verify application answers or review with insured here | No duty to verify or review; judgment n.o.v. affirmed |
| Whether a vague or assumed request to “find coverage” creates a duty to procure specific coverage or advise on omitted matters | An assumed request to obtain replacement insurance encompassed a duty to ensure the policy would be effective and accurate | A general/assumed request is insufficient under §2‑2201 and case law to impose a duty to obtain specific coverage or expand producer obligations | General request insufficient; duty limited to procuring coverage or notifying of rejection |
| Whether factual disputes and expert testimony precluded judgment n.o.v. | Conflicting expert opinions about producer practices created factual disputes for the jury | Evidence showed Werner procured replacement coverage through American Family and could not know roof age; no material dispute on duty | No; as a matter of law no duty existed, so judgment n.o.v. proper |
| Whether imposing a verification duty would extend statutory duty beyond legislature’s intent | (Overlaps first issue) Plaintiff argues duties can be created by agent conduct | Defendants argue extension would conflict with statutory scope and precedent | Court agrees with defendants; statutory duty not so broad |
Key Cases Cited
- Maple v. Gustafson, 151 Ill. 2d 445 (standard for judgment notwithstanding the verdict)
- York v. Rush-Presbyterian-St. Luke’s Medical Center, 222 Ill. 2d 147 (de novo review of judgment n.o.v.)
- Industrial Enclosure Corp. v. Glenview Insurance Agency, Inc., 379 Ill. App. 3d 434 (insurance broker duty to procure requested coverage)
- Melrose Park Sundries, Inc. v. Carlini, 399 Ill. App. 3d 915 (no duty to obtain coverage not specifically requested)
- Pittway Corp. v. American Motorists Insurance Co., 56 Ill. App. 3d 338 (broker’s primary function is to procure coverage requested by client)