text:
    Louis Meneghen, d/b/a Cottage Grove Land Fill Company, Plaintiff-Appellant, v. Calumet Development Corp. et al., Defendants-Appellees.
    (No. 59950;
    First District (5th Division)
    May 17, 1974.

      Norman P. Wexler, of Wexler, Wexler and Heller, Ltd., of Chicago (Wexler and Wexler, of counsel), for appellant.
    Carey, Filter & White, of Chicago (Edward M. White, of counsel), for appellees.
   Mr. PRESIDING JUSTICE SULLIVAN

delivered the opinion of the court:

Plaintiff appeals from the denial of his motion to vacate an order which dismissed his suit and denied him leave to file an amended complaint.

Suit was originally brought seeking a declaratory judgment that a lease was in full force and effect and also seeking damages for breach of the lease. The complaint alleged in one count that plaintiff had made a request of defendant Calumet Development Corp. (Calumet) to extend the terms of an existing lease and that Calumet orally guaranteed that the lease would be extended for a period of not less than 5 to 7 years beyond the year 1970. The second count alleged that all defendants conspired to breach the lease and thus prevented him from conducting his business, for which he sought damages. Defendants moved separately to strike and dismiss the complaint, asserting the defense of the statute of frauds and that the oral lease was too indefinite and therefore was a nullity.

Plaintiff’s original attorney ■ did not appear for the hearing on the motions to strike and dismiss and, after an examination of the pleadings, the court struck the complaint and dismissed the suit.

Subsequently, plaintiff learned that his attorney failed to appear for the hearing because he had been institutionalized for a physical impairment. He retained new attorneys and, on their motion, the order of dismissal was vacated and the matter was again set for hearing on the. motions to strike and dismiss. This hearing was held on November 26, 1973, and the suit was again dismissed. Thereafter, within 30 days, plaintiff filed a dual motion to vacate the dismissal order of November 26, 1973, and for leave to file a first amended complaint. This motion was denied on December 17, 1973, and it is from that order and the order of November 26, 1973, that this appeal was taken.

OPINION

Plaintiff contends his motion filed December 17, 1973, to vacate the judgment of dismissal was in compliance with section 50(5) of the Civil Practice Act (Ill. Rev. Stat. 1973, ch. 110, par. 50(5)) which, in pertinent part, provides:

“(5) The court may in its discretion, before final order, judgment or decree, set aside any default, and may on motion filed within 30 days after entry thereof set aside any final order, judgment or decree upon any terms and conditions that shall be reasonable.”

A motion such as this is directed to the discretion of the court, and the question on review is whether that discretion has been abused. People ex rel. Elliott v. Benefiel, 405 Ill. 500, 91 N.E.2d 427.

Initially, we note that in his December 17, 1973, motion, plaintiff asserts only that (1) he had a meritorious cause of action and should have been given an opportunity to file a first amended complaint; and (2) defendants would not be prejudiced by this action.

Plaintiff now argues that the court abused its discretion in denying his motion to vacate, because (1) his original counsel was institutionalized at the time of the first dismissal and was not able to properly represent him; (2) the trial court was verbally informed at the hearing on December 17, 1973, that additional evidence had been discovered which would further enable the plaintiff to substantiate his claim and would be the basis of an amended complaint he intended to file after the dismissal was vacated; and (3) no prejudice would result to the defendants. Under those circumstances, he maintains that it was unreasonable for the court to deny the vacation of the dismissal order.

The claim that plaintiff did not have proper representation is contradicted by the record, which shows that the dismissal order entered when plaintiffs first attorney failed to appear, was subsequently vacated, and the court then held hearings on the motions to strike and dismiss, at which plaintiff's new attorney was present. Thus, it does not appear that there was any prejudice to plaintiff by any action or inaction of his first attorney.

We note also that although at one time section 50 required affidavits showing good cause to support a motion to vacate a judgment, the statute in effect at the time of the entry of the judgment of dismissal here did not require such affidavits. However, the following comment is made in the Historical and Practice Notes with reference to section 50:

“The deletion of the requirement that a motion to vacate must be supported by affidavits showing good cause does not mean that good cause need not be shown. Quite the contrary. A bare motion to vacate, without more, is insufficient. Good cause must appear or be made to appear of record. The method of showing the good cause may, but need not necessarily, be by affidavit. If the good cause is based on matter de hors the record an appropriate and undoubtedly the normal means of making it a matter of record will be an affidavit.”

We have examined the record, which does not include a report of proceedings, and are unable to find any information therein which could be the basis upon which the dismissal order should have been vacated. Plaintiff, in his brief, states the court was orally informed that there was new evidence which would be incorporated in an amended complaint when and if the dismissal was vacated. However, there is nothing in the record or in the briefs as to the nature of this additional evidence or its materiality, nor does it appear from the record that plaintiff offered the court a proposed amended complaint at any time.

Under those circumstances, we believe that the language of the court in Fournier v. Kitsos, 27 Ill.App.2d 464, 169 N.E.2d 803, is appropriate. There, , at page 467, it was stated:

“‘Although wide discretion is given the trial court, the discretion must be exercised within the scope of the law. The picture as seen by the trial court may have differed from the one exhibited to us, but we must act upon the record submitted and not upon extraneous information supplied by counsel. The motion, as reflected by the record, was insufficient factually and inadequate legally to justify setting aside the judgment.”

Here, we are of the opinion that good cause does not appear of record and because no facts were presented to the trial court for the exercise of its discretion, there was no abuse thereof.

For the reasons stated, the judgment is affirmed.

Judgment affirmed.

DRUCKER and LORENZ, JJ., concur.


source: Caselaw Access Project

author: Mr. PRESIDING JUSTICE SULLIVAN

license: Public Domain

text:
    McKinley Avery et al., Plaintiffs-Appellees, v. E. James Garbutt et al., Defendants-Appellees—(Joseph J. Moseley et al., Petitioners-Appellants.)
    (No. 59503;
    First District (5th Division)
    May 17, 1974.
    James R. Bronner, of Chicago (Davis, Miner, Barnhill & Bronner, of counsel), for appellants.
    Bernard Carey, State’s Attorney, of Chicago (Sheldon Gardner and Edna Selan Epstein, Assistant State’s Attorneys, of counsel), for appellees.
   Mr. PRESIDING JUSTICE SULLIVAN

delivered the opinion of the court:

This is an appeal from the denial of a petition to intervene. The original plaintiffs, sergeants in the Cook County Department of Corrections (DOC) and the Fraternal Order of Police (FOP) Lodge No. 20, sought a declaratory judgment that defendants do not have the power to hold examinations for the certification and promotion for all ranks of correctional officers.

After an order was entered temporarily restraining defendants from holding a proposed examination for correctional officer supervisors, plaintiffs filed an amended and supplemental complaint, which impleaded Richard J. Elrod, Sheriff of Cook County, as a party defendant and alleged that numerous officers who had not taken the appropriate promotional examination had, nevertheless, been temporarily certified, appointed and promoted, and were serving as sergeants, lieutenants and captains in DOC. Concurrent with the filing of this amended complaint, FOP withdrew as a party plaintiff.

Subsequently, on June 19, 1973, a declaratory judgment order was entered, approved by all of the parties then in the case, which provided for merit status, without examination, of those employees temporarily appointed as sergeants, lieutenants and captains who held their respective ranks for one year prior to June 25, 1973. In addition, defendant Merit Board was ordered to thereafter hold separate promotional examinations for those positions open only to those with merit status in the next lower rank. On August 7, 1973, 49 days after the aforesaid declaratory judgment order, petitioners, civil service officers in DOC, sought leave to intervene, asserting that the order of June 19, 1973, had been entered without their knowledge and that it adversely affected their prior promotional rights which were guaranteed by statute and by the rules and regulations of defendant Merit Board. They also sought to have the June 19, 1973, order vacated.

During the hearing on the motion for leave to file the petition to intervene, the trial court requested that petitioners file affidavits indicating whether or not they were members of FOP during the time it was a party plaintiff. Each of the petitioners stated he was a member of FOP at that time; however, only one knew, prior to late July, 1973, of FOP’s participation in the lawsuit, and none of them had any notice or knowledge prior to that time that FOP had withdrawn as a party plaintiff.

OPINION

The sole contention here is that the trial court erred in denying leave to file the petition to intervene. The record discloses that when it was denied, the trial judge stated he had lost jurisdiction to allow it because it was not presented within thirty days. Defendants argue that petitioners did not show, as required by section 26.1 of chapter 110 (Ill. Rev. Stat. 1971, ch. 110, par. 26.1) that (1) the motion to intervene was timely; and (2) they were bound by the order.

We initially note that, although petitioners were members of FOP, three of them, Moseley, Banks and Parker, in their uncontradicted affidavits, stated they did not have notice or knowledge of FOP’s involvement in the action. Their affidavits also state they were not aware until late in July, 1973, that FOP had withdrawn. A fourth petitioner, Smith, in his affidavit, admitted his awareness of FOP’s participation in the original action but stated he did not know until late July, 1973, that FOP had withdrawn. The petition to intervene was filed on August 7, 1973, 49 days after the entry of the order.

Defendants cite City of Lockport v. County Board, 2 Ill.App.3d 970, 276 N.E.2d 13, Dowsett v. City of East Moline, 8 Ill.2d 560, 134 N.E. 2d 793 and City of Chicago v. Zik, 63 Ill.App.2d 445, 211 N.E.2d 545, as standing for the rule that “where intervention is permitted after the entry of a final order, the time limit consistently established is that the time for the notice of appeal must not yet have run.” We have examined these cases, and we disagree with defendants. In City of Lockport, the motion to intervene was made 22 days after a dismissal order. The court held it was timely but did not relate its ruling to the time for the notice of appeal. In Dowsett, a motion to intervene was made to vacate a judgment or, in the alternative, to open the judgment, both of which were required to be filed within 30 days under section 68.3 of the Civil Practice Act (Ill. Rev. Stat. 1955, ch. 110, par. 68.3.) There was no holding that a motion to intervene was required to be filed within the time for filing a notice of appeal. In City of Chicago, although the court referred to the fact that the petition was filed within 30 days after knowledge of a demolition proceeding, it did not hold or state that a petition to intervene must be filed within 30 days after a final order. The court stated, at page 448:

“Their attempt to intervene was timely since petitioners did not have notice or knowledge of the demolition proceeding until it was culminated and their petition was filed within thirty days thereafter. Intervention, though usually allowed only before judgment, will be granted after judgment where it is the only way to protect the rights of the intervenor. [Citations.]”

In this regard, petitioners refer us to People ex rel. Baylor v. Bell Mutual Casualty Co., 2 Ill.App.3d 17, 276 N.E.2d 113, where the final order confirming and spreading an assessment of record was entered on January 19, 1968, the court held a petition to intervene filed March 15, 1968, was timely.

In view thereof, we believe that case law does not support defendant’s time to appeal, and we note that there is no such limitation in section 26.1.

We therefore are of the opinion that the trial court was in error in refusing leave to file the petition to intervene, because it was not presented within 30 days, and we conclude that it had jurisdiction to consider whether the petition conformed to the requirements of section 26.1.

Defendants also contend that the question of whether a petition to intervene under section 26.1 was timely is within the court’s discretion and that there was no showing here of an abuse of discretion. We agree that the question of timely intervention is left to the discretion of the trial court. (Duncan v. National Tea Co., 14 Ill.App.2d 280, 144 N.E.2d 771.) However, there is error when a trial court refuses to exercise discretion in the erroneous belief that it had no discretion as to the question presented. (People ex rel. Chesapeake & Ohio Ry. Co. v. Donovan, 30 Ill.2d 178, 195 N.E.2d 634.) In this regard, it is our opinion that here, when the trial court stated it did not have jurisdiction to consider the intervention, it did not exercise discretion; in effect, it was an erroneous declaration that the court was without discretion.

For the reasons stated, the judgment of the trial court is reversed and remanded for further proceedings not inconsistent with this opinion. .

Reversed and remanded with directions.

DRUCKER and LORENZ, JJ., concur.


author: Mr. JUSTICE GOLDBERG

text:
    William S. Kleinman, Plaintiff-Appellant, v. Commercial Insurance Company of Newark, N.J., Defendant-Appellee.
    (No. 59302;
    First District (1st Division)
    May 20, 1974
    Harry G. Fins, of Chicago, for appellant.
    Clausen, Hirsh, Miller & Gorman, of Chicago (James T. Ferrini, Frank L. Schneider, and William J. Sneckenberg, of counsel), for appellee.
   Mr. JUSTICE GOLDBERG

delivered the opinion of the court:

This appeal presents a question involving health and accident insurance issued under the auspices of a Chicago Bar Association disability program. William S. Kleinman (plaintiff), a distinguished member of the Bar for many years, brought suit against Commercial Insurance Company of Newark, New Jersey, (defendant) and Parker, Aleshire & Company, a corporation, agent of defendant. Summary judgment was entered in favor of defendant and plaintiff has appealed.

Plaintiff’s complaint consisted of four counts. Count I sought declaratory relief and recovery from defendant of weekly disability benefits which allegedly accrued and were unpaid after September 15, 1971. Count III alleged an anticipatory breach of the insurance contract by defendant so that plaintiff was entitled to recover all remaining disability payments in a lump sum. Counts II and IV sought damages from Parker, Aleshire & Company as defendant’s agent. We need not concern ourselves with Counts II and IV against the agent. After the trial court had granted summary judgment in favor of defendant, there was a trial on the issues between plaintiff and the agent which terminated in favor of the agent. Plaintiff-has expressly abstained from seeking review of this order.

The record shows that the relationship between the parties is a typical group insurance situation. Defendant has issued a Group Disability Policy insuring members of the Chicago Bar Association. Plaintiff and other insured persons received certificates of insurance. A copy of plaintiff’s certificate is appended to his complaint. It certifies that plaintiff “is insured under and subject to all conditions and limitations of said Group Disability Policy * * * for loss resulting from injury or caused by sickness, in the manner and to the extent therein provided.” It provides also that if the holder thereof should be wholly and continuously disabled that a weekly indemnity would be paid “commencing with the eighth day of disability, or from the first day of hospital confinement, whichever shall occur first, but not exceeding 416 weeks nor beyond the 73rd Anniversary of the Covered Member’s date of birth whichever occurs first.”

There is also appended to plaintiff’s complaint a letter, dated September 12, 1961, from defendant’s agent addressed to plaintiff. This letter indicates the terms and conditions of a modification of the disability insurance program which was under consideration at that time. Prior to September 1,1961, plaintiff was covered under two insurance contracts. One was issued by defendant and provided disability indemnity payments for 5 years in cases of house confinement. The other contract, underwritten by Bankers’ Security Life, would extend these disability benefits for an additional period. Defendant then offered a new contract with increased benefits as a substitute for the Bankers’ Life Policy. The choice made by each policyholder was evidenced by a so-called enrollment application. The policyholder could elect either of two alternatives. Plaintiff elected alternative B. A photocopy of this enrollment application signed by plaintiff demonstrates it to be in words and figures as follows:

“Commercial Insurance Company of Newark, N.J.
Gentlemen:
I would like the following coverage which you offer under the Chicago Bar Association Disability Program:
Alternative A One Contract
[x] Alternative B Two Contracts
Lifetime Accident and 8 year Sickness Benefit.
Retain Present Basic Contract and a New Contract with Lifetime Accident & 8 years Sickness Benefits payable after 6 months.
I understand that the insurance hereby requested will not be effective unless I am regularly attending all of the usual duties of my occupation on the effective date of the Certificate.
August 29, 1961
Date
/s/ WILLIAM S. KLEINMAN
Signature”

Defendant answered the complaint. The important allegation thereof is the affirmative statement that the 73d anniversary of plaintiff’s date of birth occurred on September 15, 1971. It is undisputed by the parties that plaintiff did actually become disabled from sickness under the terms of the policy beginning December 10, 1964, and that plaintiff, born September 15, 1898, became 73 years of age on September 15, 1971. Defendant has paid all indemnities due until the 73d anniversary of plaintiff’s birth.

Plaintiff filed a motion for summary judgment under Counts I and III. Defendant filed a motion for summary judgment in its favor. There is no disputed question of material facts between these parties. The sole issue presented here is one of law as to the effect of the so-called enrollment application on the rights of the parties with reference to the master policy of insurance and the certificate thereof held by plaintiff.

In this court, plaintiff contends that the enrollment application is actually a rider. Based upon this assumption, plaintiff urges the familiar and established rule of law that, where an insurance policy contains a rider with provisions more favorable to the insured than the terms of the policy, the rider controls the rights of the parties. On the contrary, defendant urges that the enrollment application was purely and simply an application, as distinguished from a rider or a new contract; there is no conflict between the policy and the application form but the contract of insurance merely provides a limitation upon which the application was silent and this limitation required termination of disability benefits upon the 73d anniversary of plaintiff’s birth.

A careful study of all of the matters before us leads inevitably to the conclusion that defendant’s position is well taken. We do not have a situation in which policy language is ambiguous so as to require us to resort to canons of construction. (Illinois National Insurance Co. v. Trainer, 1 Ill.App.3d 34, 36, 37, 272 N.E.2d 58.) We have instead clear-cut language which impels us to the indicated result. Plaintiff s certificate expressly recites that he “is insured under and subject to all conditions and limitations of said Group Disability Policy.” The certificate itself expressly provides that disability benefits will not be paid “beyond the 73d Anniversary of the Covered Member’s date of birth.” The enrollment application signed by plaintiff constitutes an offer to augment the insurance contract as regards the number of weeks of sickness indemnity and amount thereof, but it does not purport to affect or modify in any regard the underlying and pre-existing condition that these payments are to terminate upon the 73d anniversary of plaintiffs birth.

The language of the master policy, as reproduced in plaintiffs certificate, provides that it “constitutes the entire contract of insurance.” We note also a rider appended to plaintiffs certificate signed by defendant’s agent as of September 1, 1961, carrying out the conditions of the enrollment application signed by plaintiff and providing specifically, “[njothing herein contained shall be held to vary, alter, waive or extend any of the terms, conditions, agreements or limitations of the undermentioned Policy other than as above stated.”

There are many instances in which attempts have been made to modify the clear, unambiguous and binding provisions of insurance contracts by correspondence, brochures and even by subsequent representations. A number of cases involving this type of situation are analyzed in a recent opinion of this court (Gross v. University of Chicago, 14 Ill.App.3d 326, 302 N.E.2d 444, leave to appeal denied November 29, 1973.) In the case before us, as we did in Gross, we are obliged to take the position that the provisions of the agreement between the parties concerning the limitation upon the payments for sickness indemnity “were inserted deliberately and for a purpose, and we may not disregard them.” (14 Ill. App.3d at 338.) As contended by defendant, other decisions lead to the same result. See Fuller v. Standard Oil Co., 1 Ill.App.3d 799, 274 N.E.2d 865.

In plaintiffs reply brief, reference is made to a letter from defendant’s agent to plaintiffs wife, dated January 24, 1966, enclosing drafts representing certain disability payments. The reply called our attention to language in this letter, “this indemnity is payable for a period of 8 years and house confinement is never required” and attempted to postulate an argument of “estoppel and waiver” thereon. Defendant has made a motion to strike, this portion of the reply on the ground that this point was not raised in plaintiffs initial brief. In view of the result reached after trial of the issues involving defendant’s agent, no further consideration of this matter is required. Defendant’s motion to strike portions of plaintiffs reply, taken with the case, is accordingly denied.

Judgment affirmed.

BURKE and HALLETT, JJ., concur.


text:
    F. Abraham et al., Plaintiffs-Appellees, v. U. A. W. International et al., Defendants-Appellants.
    (No. 58449;
    First District (1st Division)
    May 20, 1974.
    Harold A. Katz, Irving M. Friedman, Zenia Goodman, and Stuart Gordon, all of Chicago (Katz & Friedman, of counsel), for appellants.
    Adamowski, Newey & Riley, of Chicago (Robert W. MacDonald and Francis X. Riley, of counsel), for appeHees.
   Mr. JUSTICE GOLDBERG

delivered the opinion of the court:

This record presents an action brought by approximately 300 pro duetion and maintenance employees of Automatic Transportation Company (employer) against International Union, United Automobile, Aircraft and Agricultural Implement Workers of America and 10 individuals described as members, officers, agents or representatives of said International Union or the Executive Board thereof (defendants). The local affiliate of the International Union, with which the employer had a collective bargaining agreement, is not a party to the cause.

After trial without a jury, the court entered a judgment containing findings of fact and conclusions of law and granting plaintiffs “a judgment of liability for losses sustained against the defendants, individually and collectively, by reason of defendants’ tortious conduct.” The court also retained jurisdiction “for the purpose of an accoimting of the amount of losses plaintiffs have sustained, and for the entry of a judgment for such losses, against defendants together with interest and costs.” Thereafter, after hearing further testimony from 121 of the plaintiffs “relative to the losses, sustained by them, as a result of defendants’ tortious conduct” the trial court entered a series of judgments in favor of each of the individual plaintiffs allowing them damages for lost time and vacation pay resulting from a strike against the employer by plaintiffs. It is undisputed that not all of the plaintiffs are members of the Union. Defendants appeal.

In this court, defendants contend that the action cannot be maintained because the International Union is not suable in an action for damages; jurisdiction of the State courts has been preempted by the Federal National Labor Relations Act and Federal law has created exclusive remedies which would deprive State courts of jurisdiction; plaintiffs failed to exhaust administrative remedies within the International Union and remedies required under the employment contract; plaintiffs have not proved the case against the International Union because the strike was undertaken by the local union involved which is not a party to the cause; notice served upon the employer was adequate to prevent renewal of the labor contract; the parties orally modified their contract to be terminable on notice of 24 hours; plaintiffs voluntarily abstained from work so that they cannot recover; and tire International Union is not liable for an honest mistake of judgment made in good faith even assuming a mistake was made; the judgment of the court was erroneous in permitting recovery by plaintiffs in the absence of proof of freedom from contributory negligence; the court failed to make essential findings; critical findings made by the court are contrary to the evidence; and, finally, the court erred in awarding prejudgment interest. Plaintiffs contend that the court properly exercised jurisdiction to reimburse the members of the local union for losses sustained by reason of the fraud, deception and mistakes of the defendants; the State court had jurisdiction of the cause as an internal union dispute which Congress has not preempted under Federal law; plaintiffs have no administrative remedies to exhaust; or, alternatively, invoking them would be meaningless; and, finally, interest may be awarded in chancery where equitable considerations require it.

The gist of plaintiffs’ complaint, as amended, is that the defendants did “intentionally, wilfully, negligently and wrongfully with utter lack of due care, caution and propriety for the welfare and protection of plaintiffs * * * authorize, approve, direct, assist, support and sanction an improper, wrongful and illegal strike” at the employer’s plant; and, in addition, that the defendants caused faulty notice to be served upon the employer calling for modification of the collective bargaining agreement but should have provided for termination thereof. It is clear and undisputed that the employer was engaged in interstate commerce and the collective bargaining agreement with the local union provided that it was made pursuant to the provisions of the National Labor Relations Act.

Matters regarding the provisions and legal effect of notices for termination or modification of collective bargaining agreements covering employees in an industry affecting commerce and the legality of strikes in connection with such procedure are considered and set forth in detail under Federal law. (See National Labor Relations Act, 29 U.S.C. § 158.) Determination of the merits of the controversy between these parties necessarily involves a determination of the legal efficacy and effects of notices served upon the employer shortly prior to the termination of the collective bargaining agreement and also of the legality of a strike which occurred at the employer’s plant after the service of these notices on behalf of the employees.

Therefore, as urged by defendants, jurisdiction over the basic legal issues presented by this record has been preempted by Federal law. The cause is and must remain subject to the exclusive jurisdiction of the National Labor Relations Board. This rule of exclusive Federal jurisdiction in matters arising in interstate commerce under section 8 of the National Labor Relations Act is clearly decided by the United States Supreme Court in San Diego Building Trades Council v. Garmon, 359 U.S. 236, 3 L.Ed.2d 775, 79 S.Ct. 773. There, a peaceful strike was initiated against an employer by members of a union who sought an agreement of maintenance of membership from the employer. The California courts granted the employer an injunction against the strike and a judgment for damages. Thereafter, the United States Supreme Court vacated this judgment and remanded the cause to the California court which set aside the injunction but sustained the award for damages. The United States Supreme Court then again accepted the cause for review and reversed the judgment for damages on the specific ground of preemption of the subject matter thereof by Congress to the exclusive jurisdiction of the National Labor Relations Board. The language used by the court has been frequently quoted (see 359 U.S. at 245):

“When an activity is arguably subject to § 7 or § 8 of the Act, the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interference with national policy is to be averted.”

The court took pains to point out that if the States were to remain free to regulate conduct so plainly within the central aim of Federal regulation, there would be too great a danger of conflict between power asserted by Congress and requirements imposed by State law. See 359 U.S. at 244.

A number of later cases decided by the United States Supreme Court have considered and adhered to this theory of Federal preemption. Some of these decisions are cited in Motor Coach Employees v. Lockridge, 403 U.S. 274, 29 L.Ed.2d 473, 91 S.Ct. 1909. There, plaintiff obtained a judgment against his union for money damages in the Idaho courts. The issue was a clause in the collective bargaining agreement providing for maintenance of membership by employees in interstate commerce. The United States Supreme Court reversed this judgment on the theory that section 8 of the National Labor Relations Act (29 U.S.C. 158) regulated this form of union activity. The court held that this jurisdiction had been preempted by Congress to the National Labor Relations Board so that the State court had no authority to act (403 U.S. at 293):

“From the foregoing, then, it would seem that this case indeed represents one of the clearest instances where the Garmon principle, properly understood, should operate to oust state court jurisdiction. There being no doubt that the conduct here involved was arguably protected by § 7 or prohibited by § 8 of the Act, the full range of very substantial interests the pre-emption doctrine seeks to protect is directly implicated here.”

In opposition to this argument and the authorities above cited, plaintiffs rely primarily upon four decisions by the United States Supreme Court. None of these authorities is applicable here. In U.A.W. v. Russell, 356 U.S. 634, 2 L.Ed.2d 1030, 78 S.Ct. 932, the evidence showed the commission of violent acts during the course of a strike. The Supreme Court held that this type of conduct created an exception to the preemption doctrine. The court noted this differentiation in Garmon where it pointed out that “the regulated conduct touched interests so deeply rooted in local feeling and responsibility that, in the absence of compelling congressional direction, we could not infer that Congress had deprived the States of the power to act.” (See 359 U.S. at 244.) Note the comment upon the above-quoted language from Russell and Garmon expressed by the court in Lockridge (403 U.S. at 297). The presence of elements of violence in the record is also sufficient to differentiate United Construction Workers v. Laburnum Construction Corp., 347 U.S. 656, 98 L.Ed. 1025, 74 S.Ct. 833. Similarly, International Association of Machinists v. Gonzales, 356 U.S. 617, 2 L.Ed.2d 1018, 78 S.Ct. 923, is of no assistance to plaintiffs because the facts there concerned “purely internal union matters” pertaining to relations between the individual members and the union and having nothing to do with matters of employment. As stated by the Supreme Court in Lockridge (403 U.S. at 296):

“The possibility that, in defining the scope of the unions duty to Gonzales, the state courts would directly and consciously implicate principles of federal law was at best tangential and remote. In the instant case, however, this possibility was real and immediate.”

Quite to the contrary, the rights of the litigants in the case' at bar cannot be decided without involvement of matters such as the legal effect of the notices served upon the employer which are directly and inextricably within the purview of section 8 of the Labor Management Relations Act. 29 U.S.C. § 158.

In Vaca v. Sipes, 386 U.S. 171, 17 L.Ed.2d 842, 87 S.Ct. 903, a union member filed suit against his union in the Missouri court on the ground that the employer had discharged him in violation of a collective bargaining agreement and the union had arbitrarily and without reasonable cause refused to take the grievance to arbitration in accordance with the collective bargaining agreement. The Supreme Court held that jurisdiction of the State court was not preempted by Federal law. The court reversed the judgment against the union but solely on the ground of impropriety of the award. However, the Supreme Court expressly adhered to the doctrine of preemption, as exemplified by decisions such as Garmon. The court expressly differentiated the Vaca situation by pointing out an exception to the preemption doctrine. Section 301 of the Labor Management Relations Act (29 U.S.C. § 185) “permits suits for breach of a collective bargaining agreement regardless of whether the particular breach is also an unfair labor practice within the jurisdiction of the National Labor Relations Roard.” (See 386 U.S. at 179 and 180.) Cases such as Vaca are based upon this section and present issues which concern the possibility of union discrimination against individual members (see 386 U.S. at 183, 184). No such possibility exists in the case before us.

We, therefore, are impelled to reach the conclusion that the subject matter of the case before us has indeed been preempted by Federal law so that the State courts are effectively deprived of jurisdiction.

Under this view of the controversy, it is unnecessary for us to consider or decide any of the remaining contentions raised by the parties. We will, however, note that the case presents, in our opinion, an attempt to obtain damages upon purely legal demands. For this additional reason, the court had no jurisdiction over the international union. Von Solbrig Memorial Hospital v. Licata, 15 Ill.App.3d 1025, 1029, 305 N.E.2d 252, leave to appeal denied (March 19, 1974) and authorities therein cited.

It follows necessarily that the judgment appealed from must be reversed.

Judgment reversed.

EGAN, P. J., and BURKE, J., concur.


author: Mr. JUSTICE GOLDBERG.

text:
    A. C. Patterson, Plaintiff-Appellant, v. Spinney Run Farms Corporation, Defendant-Appellee.
    (No. 59426;
    First District (1st Division)
    May 20, 1974.

      Walter LaVon Pride, of Chicago, for appellant.
    Lord, Bissell & Brook, of Chicago (Hugh C. Griffin and Richard E. Mueller, of counsel), for appellee.
   Opinion by

Mr. JUSTICE GOLDBERG.


author: Mr. JUSTICE DIERINGER

text:
    The Home Indemnity Company, Plaintiff-Appellee, v. Louis La Barbara et al., Defendants-Appellees—(Prestige Casualty Company, Defendant-Appellant.)
    (No. 59219;
    First District (4th Division)
    May 22, 1974.
    Greenberg, Ziv & McCarthy, of Chicago (Sherwin Greenberg, of counsel), for appellant.

      McKenna, Storer, Rowe, White & Haskell, of Chicago (John C. Bartler and Robert S. Soderstrom, of counsel), for appellees.
   Mr. JUSTICE DIERINGER

delivered the opinion of the court:

This is an appeal from an action for declaratory judgment brought by the Home Indemnity Company against the Prestige Casualty Company in the Circuit Court of Cook County. Also named as defendants were Louis and Marie La Barbara, Monroe Estes, a minor by John Estes, his father and next friend, and John and Verna Estes, individually.

The court entered judgment for Home against Prestige; denied Prestige’s motion for summary judgment; found that Prestige owed coverage for Monroe Estes; found that Prestige had a duty to defend Monroe Estes in a suit filed by the La Barbaras against him for personal injuries allegedly sustained as a result of an automobile accident of January 24, 1970; and held that the exclusionary endorsement was null and void. The other defendants to the declaratory suit were voluntarily dismissed out, and Prestige alone has appealed.

The issue for review is whether the exclusionary endorsement contained in the policy issued by the Prestige Casualty Company is valid.

On January 24, 1970, Monroe Estes, a minor, was driving a car owned by his parents when it was involved in an accident with an automobile driven by Louis La Barbara. Both he and his wife claimed personal injuries and filed a lawsuit against Monroe Estes, Verna Estes and John Estes.

Prior to the date of the accident, Prestige had issued an insurance policy to John and Verna Estes which was subsequently modified on December 4, 1969, by an endorsement which excluded coverage to “any male driver under the age of 25; or by any unmarried female driver under the age of 25; or by any person for use to or from work.” Based on this endorsement signed by John and Verna Estes, Prestige Casualty Company denied liability and coverage under the policy for the accident of Monroe Estes.

Home Indemnity Company, the uninsured motorist carrier of the La Barbaras, filed this action alleging the endorsement was invalid because of prior disapproval of tire Director of the Department of Insurance. The plaintiff filed a motion for summary judgment which was granted, and Prestige Casualty Company appeals from that order.

On March 10, 1966, the Director wrote a letter to Prestige requiring that it “cease and desist” in the use of a blank restrictive endorsement form which contained language denying coverage followed by a blank for typing in the circumstances under which coverage is denied. On April 13, 1966, Prestige replied to the letter .of March 10, to explain the use of the endorsement and request that tire Department file the endorsement. Enclosed in the letter was an example of an exclusionary endorsement of the type signed by John and Verna Estes. Both the letter of April 13 and the example were marked with the stamp of the Department of Insurance and contained the word “filed.”

Prestige contends there was a lack of proof the March 10 letter referred to the endorsement involved in this case, and even assuming that the letter did refer to the endorsement in question, the Director approved it by marking it with a filing stamp. Section 143 of the Insurance Code (Ill. Rev. Stat., ch. 73, § 755) provides in part:

“The Director shall require the filing of all policy forms issued by any company transacting the kind or kinds of business enumerated in Classes 2 and 3 of section 4. He may require, in addition thereto, the filing of any generally used riders, endorsements, application blanks and other matter incorporated by reference in any such policy or contract of insurance.”

Prestige argues that when the Director disapproves the use of an endorsement, he is inviting the submission of a new endorsement or an explanation of the- use of the original endorsement. By not replying to the letter of April 13, Prestige contends the Director accepted the explanation tendered in that letter and thereby approved the endorsement.

The defendant also claimed at the hearing that a letter of June 3, 1971, from the rate examiner of the Department to Prestige was relevant as being a part of a continuing correspondence and constituted a clarification of the earlier letters. That letter stated as follows:

“To afford a permanent record regarding our understanding of this matter, we would like to reiterate our position.
1) An endorsement having the effect of excluding coverage for male drivers under 25 may be used if signed by the insured and if the endorsement is only applied to policy-holders which probably have such exposure. The endorsement is not to be attached to policies simply because of the rate class applied to that policy.
2) You are directed to cease and desist using this endorsement with additional commentary type which would have the effect of nullifying coverage for the automobile to be used driving to and from work. In no case will such an exclusion be acceptable.”

From this letter Prestige concludes it had been previously authorized to use the under-25 exclusion signed by John and Verna Estes.

These arguments are not persuasive. There can be no doubt from the description in the letter of March 10 that the blank restrictive endorsement form to which it objected is the same as the one before us. Nor can .it be inferred from the existence of a filing stamp on the letter of April 13 that the Director intended to ratify an endorsement he had recently condemned. Nowhere in the record is there an indication the Department invited the resubmission of the endorsement, and we believe the Director need not continue to issue “cease and desist” orders with respect to the same endorsement form.

Neither is the letter of June 3, 1971, helpful to the defendant’s cause. Even though it condones the use of the under-25 exclusion in certain circumstances, it expressly prohibits the joinder of the under-25 exclusion with one denying coverage to one driving to and from work. The endorsement form signed by John and Verna Estes contains the prohibited joinder of exclusions.

Next, the defendant claims that even if the endorsement form was prohibited by the Director, it did not violate the Insurance Code and the only ill effect on Prestige, in light of the Director’s disallowance, would be the payment of a fine. (Ill. Rev. Stat., ch. 73, § 1058.) However, in the case of Linkens v. Furman (1964), 52 Ill.App.2d 1, the court held that casualty insurance companies are not allowed to issue endorsements binding on their insureds after the Director has expressly found the endorsement to be not acceptable for use in Illinois. The court stated:

“If such a construction [of section 143 of the Insurance Code] were to prevail, the filing and examination provisions of paragraph 755(2) would be rendered ineffective to accomplish them evident function of public protection.”

If Prestige had wanted to contest the decision of the Director ordering it to cease and desist from using the exclusionary endorsement, it could have followed the provisions of section 407 of the Insurance Code (Ill. Rev. Stat. 1969, ch. 73, § 1019) which provides for court review of the Director’s orders.

The defendant relies on the case of Allison v. Beechy (1972), 4 Ill. App.3d 1096, for the proposition that an under-25 exclusion is legal in the State of Illinois. But in that case no cease and desist order had been issued by the Director, and for this reason that case is inapplicable to the one at bar.

Prestige contends the terms of the endorsement did not violate the Insurance Code. Section 143(2) of the Code (Ill. Rev. Stat. 1969, ch. 73, §755(2)) provides that the Director may object on the grounds the endorsement contains “inconsistent, ambiguous or misleading clauses, or contains exceptions and conditions that will unreasonably or deceptively affect the risks that are purported to be assumed by the policy * * *." In this case coverage was withdrawn when the driver was a male under 25 or an unmarried female under 25 or if the car was being used to and from work. We think in such a case the rationale of the case of Preferred Risk Mutual Insurance Co. v. Manchester Insurance & Indemnity Co. (7th Cir. 1972), 467 F.2d 1230, is applicable:

“It was clearly within his [the Director of Insurance] discretion to find that an endorsement which unilaterally withdrew coverage from a large class of potential drivers of the insured’s automobile unreasonably or deceptively affected the risks that are purported to be assumed by the policy.’ His decision and the authority to make this determination are well supported by Illinois decisions.”

The facts of this case are undisputed and the lower court was correct in its ruling as a matter of law. For these reasons the judgment of the Circuit Court of Cook County is affirmed.

Affirmed.

ADESKO, P. J., and JOHNSON, J., concur.


text:
    James J. Brown, Plaintiff, v. Ira Gitlin, Defendant—(Ira Gitlin, Third-Party Plaintiff-Appellant, v. Michael I. Freeman, Third-Party Defendant-Appellee).
    (No. 59255;
    First District (4th Division)
    May 22, 1974.

      Sidney Z. Karasik, of Chicago, for appellant.
    Donald S. Hilliker and James N. Nowacki, of Isham, Lincoln & Beale, of Chicago, for appellee.
   Mr. JUSTICE DIERINGER

delivered the opinion of the court:

This is a third-party action for malpractice brought by Ira Gitlin in the Circuit Court of Cook County against his attorney, Michael Freeman, after a sale of closely held securities was voided because of the attorney’s failure to file a report with the Secretary of State.

The issue for review is whether the judgment of the trial court in favor of the third-party defendant was against the manifest weight of the evidence.

In 1965, Ira Gitlin and James Brown organized a corporation, Super Hawk Food Service, Inc., and each held 1000 shares of stock. In August of 1969, Gitlin asked Freeman to represent him in the sale of his one-half interest in the corporation to Brown. Freeman prepared the necessary documents, including the September 2, 1969, sales agreement in which Gitlin agreed to sell his shares for $20,000. The transfer of stock took place on September 9,1969.

On November 20, 1969, Brown served notice on Gitlin that he was electing to declare the sale void for the reason that it was not registered with the Secretary of State as required by the Illinois Securities Law of 1953 (Ill. Rev. Stat. 1967, ch. 121½, § 137.1 et seq.) Brown tendered the shares to Gitlin, but Gitlin chose to retain the purchase price. On November 24, 1969, Brown commenced an action against Gitlin to have the sales agreement rescinded, the purchase money refunded, and attorneys’ fees reimbursed.

On September 22, 1970, the trial court ruled that Gitlin was not required under the statute to report the sale and entered summary judgment in favor of Gitlin. On appeal, the appellate court reversed (Brown v. Gitlin (1972), 4 Ill.App.3d 1040), and after a hearing on remand judgment was entered for Brown as follows: Brown got back his $20,000 along with $3,038 accrued interest on the purchase price; he recovered $1000 attorneys’ fees and was reimbursed for $636 court costs. The 1000 shares of the corporation were ordered re-assigned to Gitlin.

The amended third-party complaint, filed on July 27, 1972, by Gitlin against his attorney alleged that Freeman did not file a report of the transfer of shares as required under section 4G of the Illinois Securities Law (Ill. Rev. Stat. 1967, ch. 121½, § 137.4G), and that the failure to file such a report constituted malpractice.

The trial court found that Freeman failed to report the sale or advise Gitlin to make such a report, but ruled he did not fail to exercise a reasonable degree of professional skill and dismissed the case as to Freeman on March 12, 1973. Gitlin appeals from that judgment.

The law in Illinois is clear that an attorney is liable to his client for damages only when he fails to exercise a reasonable degree of care and skill. (Stevens v. Walker (1870), 55 Ill. 151; Bryant v. Metropolitan Motorists Ass’n (1959), 23 Ill.App.2d 261.) It is also clear the law distinguishes between errors of negligence and those of mistaken judgment. Stevens v. Walker (1870), 55 Ill. 151; Morrison v. Burnett (1894), 56 Ill.App. 129; Dorf v. Relles (1966), 355 F.2d 488.

At trial Freeman stated he did not read the Securities Act or consider Securities Act aspects of the case because the pubHc was not involved.

The plaintiff contends the issue of whether an attorney is guilty of negligence is a mixed question of law and fact, and the defendant was guilty of negligence as a matter of law. In the case of Curtis v. Johnson (1968), 92 Ill.App.2d 141, the court stated:

“Knowledge that the sale is voidable’ is a mixed question of fact and law on which a layman is entitled to acquire his first knowledge from an attorney.” (92 Ill.App.2d at 155.)

However, the question here is not knowledge by the client, but whether or not the attorney was guilty of negligence. In Illinois the question of whether a lawyer has exercised a reasonable degree of care and skill in representing and advising his client has always been one of fact (Priest v. Dodsworth (1908), 235 Ill. 613; Sanitary Hair Goods Co. v. Elliott (1915), 191 Ill.App. 563), and the standard of care against which a professional’s actions are measured must be based on expert testimony. (Olson v. North (1934), 276 Ill.App. 457.) Moreover, it is plaintiff’s duty to prove by a preponderance of the evidence that the defendant breached his duty to the plaintiff. (Priest v. Dodsworth (1908), 235 Ill. 613; Oda v. Highway Insurance Co. (1963), 44 Ill.App.2d 235; Trustees of Schools v. Schroeder (1971), 2 Ill.App.3d 1009.) To meet that duty the plaintiff offered only the expert testimony of the law partner of plaintiff’s counsel. In contrast the defendant presented the testimony of three expert witnesses, each with long and distinguished legal experience in Illinois, who testified the defendant had not acted improperly. Mr. Alex Elson testified in part as follows:

“The corporate form was adjunct to this thing. But what was involved here was the sale of a business from one partner to the other. These were two men who knew each other, who had been partners for a substantial period of time, as I recall about four years. Under those circumstances I think most lawyers, if not all lawyers, would look upon it as simply the sale of a business, and it would never have occurred to them to think of the securities laws as being applicable. This was not the sale of shares to a stranger, to an outsider or to a group of people.”

Mr. Marks testified in part as follows:

“I simply do not believe that a practitioner would conceive of a sale between two equal owners of stock in a partnership in corporate form would be a transaction that was covered by the Securities Law.”

The trial judge found the testimony of the plaintiff’s expert witness not to be credible and stated:

“He [the defendant] acted in a way which I am satisfied of the facts was commensurate with the practice of the reasonably competent lawyer in Cook County, Illinois. * * * I am also satisfied that the average reasonably competent lawyer would not have recognized securities applications here, on the main case on appeal, and I don’t think I can charge him with that duty.”

After reviewing the record we conclude there was ample evidence to support the judgment of the trial court. Until the case of Brown v. Gitlin, there was no clear answer on whether this type of transaction between 50% owners of a corporation required a 4G filing. In a case such as this, error by the attorney does not constitute malpractice.

For the reasons stated, the judgment is affirmed.

Affirmed.

ADESKO, P. J., and JOHNSON, J., concur.


author: Mr. JUSTICE BURMAN

text:
      In re Estate of Eva Van Duser, Deceased—( Katherine Powers et al., Respondents-Appellants, v. Ethel Van Duser, Petitioner-Appellee.)
    (No. 59446;
    First District (4th Division)
    May 22, 1974.
    William Sulkin, of Chicago, for appellants.
    Richard G. Kahn and McLaughlin, Kinser & Bryant, both of Chicago, for appellee.
   Mr. JUSTICE BURMAN

delivered the opinion of the court.

This is an appeal from an order of the Probate Division of the Circuit Court granting the motion of appellee, Ethel Van Duser, to apportion payment of Federal estate taxes.

The facts giving rise to the motion are these: Eva Van Duser died intestate. Her gross probate estate consisted of approximately $25,000 in personal property and $40,000 in real estate. Her only two heirs at law are her sisters, Ethel Van Duser and Katherine Powers. They are each to receive 50% of the probate assets. Sue Hicks, a daughter of Katherine Powers, was appointed administrator of decedent’s estate. .

In addition to the above assets, there were other amounts of personal property in joint tenancy at the time of decedent’s death held in the name of tiie decedent and her sister Katherine Powers, her sister’s children, and her sister’s grandchildren as follows:

Katherine Powers $127,096.73
Sue Hicks 18,810.80
Gary Hicks 6,973.50
Janet Hicks 7,032.60
Jonathan Hicks 3,111.24
William Hicks 3,111.24
Robert Hicks 3,404.49
TOTAL $169,540.60

(Each of the above-named Hicks is either a child or grandchild of Katherine Powers, one of decedent’s two sisters.) These assets, passing in joint tenancy to the designated surviving joint tenants, are not part of the probate estate.

The total Federal estate tax on the decedent’s estate is $39,667. Since joint tenancy property is considered part of a decedent’s estate for purposes of determining Federal tax liability, this total amount of tax liability was generated proportionately by the amount of the property passing in joint tenancy. According to the figures contained in the Probate Division’s order of August 6, 1973, and adopted in appellants’ brief, 77.2% of the $39,667 tax liability — or $30,623 — was generated by the $169,540 passing in joint tenancy.

On May 11, 1973, based on the above facts, Ethel Van Duser, as heir of 50% of the probate estate, filed her motion to apportion payment of the Federal estate tax due by reason of decedent’s death so that the surviving joint tenants would be directed to pay their equitable shares. The administrator, Sue Hicks, filed an answer to the motion admitting the allegations in the motion, but stating that, according to the law in Illinois, only the assets of the estate should be used to pay the Federal estate tax and not the assets outside the estate — the latter here being the property held in joint tenancy.

On August 1,1973, an order was entered allowing the motion to apportion payment of the Federal estate tax. The named surviving joint tenants were ordered to pay to the administrator their respective proportionate shares of the tax in the same amounts which they would have contributed if they had received their respective amounts as heirs of the decedent instead of as surviving joint tenants. Another order was entered which recited that the total Federal tax amounted to $39,667 and set forth the amount to be paid by each person involved. On August 8,1973, Katherine Powers and Sue Hicks filed an appeal from the entry of the above orders.

No testimony was heard in the Probate Division. The case was decided entirely on the pleadings. In appellants’ brief we are informed that all surviving joint tenants consent to the jurisdiction of the court over the subject matter and the parties to this proceeding for apportionment.

The sole question presented in this appeal is clear: Shall the Federal estate tax be paid proportionately by all persons who received property from the decedent both as heirs at law and as surviving joint tenants, or should it be paid entirely from the probate assets.

Both parties agree that, under the United States Supreme Court decision in Riggs v. Del Drago, 317 U.S. 95, the ultimate impact of the tax should be determined by State law. They also point out that, unlike some other states, Illinois has no statute providing for the apportionment of Federal estate taxes. Appellants argue that in the absence of such a statute the Federal estate tax “must be considered a charge against the whole of the estate and not against individual shares,” and that the- tax is upon the entire estate payable as an expense of administration and not upon the particular devise, bequest or distributive share of the individual beneficiary.

There is no dispute that if the Federal estate tax is paid only out of the probate estate most of the entire estate would be depleted. Nor is there any dispute that the amounts passing in joint tenancy were included in determining the taxable estate for Federal estate tax purposes. In fact these, non-probate assets generated more than 75% of the total liability. We therefore agree with- appellee that logic, reason, and simple justice dictate that, unless there is a contrary intention expressed by the decedent, as in a will in testate estates, the doctrine of equitable contribution should be invoked as to non-probate assets to fairly distribute the Federal estate tax burden. There is no claim here of any tangible manifestation of intent to the contrary by the decedent, and -to refuse to apportion the tax burden would result in unjust enrichment to -the recipients of the non-probate estate at the expense of the surviving heirs. We would be hard put to say that such was the intention of the decedent. See A. Fleming, Apportionment of Federal Estate Taxes, 43 Ill. L. Rev. 153 (1948).

The appellants point out that the Federal estate tax is a tax imposed upon the property transferred by death as a whole while the Illinois inheritance tax is a tax imposed' upon the individual beneficiary, based upon the interest received. It is therefore asserted that to apportion the burden of the Federal tax would be to disregard the established nature of the two taxes, giving to the Federal tax the character of an inheritance or succession tax. We do not agree, however, that the difference in the “nature” of the two taxes should preclude equitable apportionment of the Federal tax. Although the Federal tax should be paid out - of the estate as a whole — in accordance with its recognized, character — , and the executor or administrator is made primarily liable for it, the “ultimate impact of the tax” under Riggs, cited above, should be determined by State law. It is the latter — the “ultimate thrust of the tax” — with which we are concerned, and not the method by which -the tax is assessed or collected by the Federal government.

We find- nothing in the law of Illinois prohibiting our decision under the circumstances presented here. In First National Bank v. Hart, 383 Ill. 489, 50 N.E.2d 461, relied on by appellants, the court was concerned with the apportionment of Illinois Inheritance Taxes among the distributees of a sophisticated residuary trust created in the testator’s will. There were no non-probate assets in that case and different considerations were involved. The court was not presented with the narrow question before us. The case of Hughes v. Sun Life Assurance Co., 159 F.2d 110, which relied on the Hart decision, involved an annuity contract purchased by decedent and which was includable in her estate for Federal tax purposes. The income beneficiaries of the annuity contract, who had settled the tax claim, were refused reimbursement from the company holding the annuity contract. There again different considerations were involved. In People v. Pasfield, 284 Ill. 450,120 N.E. 286, and People v. Northern Trust Co., 289 Ill. 475,124 N.E. 662, the court held only that the amount of the Federal tax to be paid should be deducted from the value of the estate before the State inheritance tax is computed, and for that purpose the Federal tax should be considered an expense of administration. These cases were not concerned with apportioning the ultimate tax burden between the recipients of probate and non-probate assets. Finally in Lawless v. Lawless, 17 Powers v. Van Duser.App.2d 481, 150 N.E.2d 646, the court refused to allow the recipients of the personal estate in a will contribution from the recipients of the real estate for Federal tax exacted entirely from the personal estate before distribution. Again no non-probate assets were involved, and the court concluded that while our courts have in certain cases invoked the doctrine of equitable contribution, no cases had been cited that would affect the situation involved therein.

We note further that the case law in many states follows the just and fair doctrine of equitable contribution, especially where non-probate assets are involved. In McDougall v. Central National Bank, 157 Ohio St. 45, 104 N.E.2d 441, probate and non-probate assets were involved. There the Supreme Court of Ohio stated that because of the existence of the non-probate trust assets the Federal estate tax was substantially increased beyond what it would have been if the trust assets had not been included in the decedent’s gross estate for the purpose of determining the amount of the tax. The court commented:

“Under those circumstances and where there are no state statutes indicating and the decedent has indicated no intention as to who or what shall bear the burden of that tax, it is difficult to understand the justice of a rule of law that would impose the whole burden of the estate tax on one of the two separate parts of this decedent’s estate.” 157 Ohio St. at 52, 104 N.E .2d at 444-445.

It was held that a fair and reasonable approach would be to allocate to both the probate and the non-probate assets their proportionate share of the whole estate tax liability. See also In re McKitrick’s Estate, 15 Ohio Op.2d 274, 172 N.E.2d 197.

The Supreme Court of Oregon, confronted with an analogous situation in Beatty v. Cake, 236 Ore. 498, 387 P.2d 355, pointed out that “[t]he trend of the courts and the legislatures to adopt rules of apportionment is understandable,” and that

“[t]here is no persuadable reason to invariably compel a residuary legatee or the heirs of an intestate to bear the entire burden of federal estate taxation when, as in this case, clear indicia of intent is lacking and it appears that the tax consequences are accidental.” 236 Ore. at 508, 387 P.2d at 359.

The court held that the defendant trustees of a non-probate trust estate must pay the pro rata portion of the Federal estate tax attributable to the addition of the value of the trust estate to the total value of the taxable estate.

In the case of In re Gallaghers Will, 57 N.M. 112, 255 P.2d 317, the Supreme Court of New Mexico upheld a lower court decision apportioning the tax burden arising from joint tenancy property. In Myers v. Sinkler, 235 S.C. 162, 110 S.E.2d 241, the non-probate asset was an inter vivos trust. The Supreme Court of North Carolina held that in the absence of statute or express direction to the contrary the ultimate burden of the estate tax should be ratably apportioned between the probate and non-probate assets in accord with the equitable principle that those who have a common interest in a subject matter should bear in common any burden affecting it. See also inter alia, Kintzinger v. Millin, 254 la. 173, 117 N.W. 2d 68; Bragdon v. Worthley, 155 Me. 284, 153 A.2d 627; Marans v. Newland, 143 Mont. 388, 390 P.2d 443; Industrial Trust Co. v. Budlong, 77 R.I. 428, 76 A.2d 600.

In sum, since the amount of the non-probate assets was included in the gross estate in determining the amount of Federal tax liability and thus contributed to the assessment of that tax, impelling justice and fairness dictate, and equity provides, that the recipients of those assets contribute in paying the Federal estate tax proportionately to the amount of tax their share generated. The judgment of the Circuit Court is therefore affirmed.

Affirmed.

DIERINGER and JOHNSON, JJ., concur.


text:
    Anna B. Bilek, Adm’r of the Estate of Lawrence Pochman, Deceased, Plaintiff-Appellee, v. Virginia Ryan, Defendant-Appellant.
    (No. 59501;
    First District (4th Division)
    May 22, 1974.
    Fiorite & Fiorite and Kozlowski & Smith, both of Chicago (Frank Fiorite, Joseph J. Kozlowski, and John A. Smith, of counsel), for appellant.
    Ben G. Ottenhoff, of Chicago, for appellee.
   Mr. JUSTICE DIERINGER

delivered the opinion of the court:

This appeal is taken from a summary judgment against the defendant, Virginia Ryan, and in favor of the plaintiff, Anna Bilek, the administrator of the estate of Lawrence Pochman in the Circuit Court of Cook County.

The issue of review is whether there is clear and convincing evidence negating the presumed donative intent of the creator of a joint tenancy savings account.

Lawrence Pochman was a joint tenant on certain savings accounts with his mother and father. After the death of his mother on November 2, 1968, he cancelled the accounts and opened new ones in his name and the name of his godchild and second cousin, Virginia Ryan.

Lawrence Pochman died intestate on January 29, 1972, almost 2 years after death of his father, and letters of administration were issued to Anna Bilek, the aunt of the deceased;

On May 18, 1972, the administrator filed a citation to discover assets, and a hearing was held on August 11, 1972. At the conclusion of the hearing, the citation was dismissed.

This action for an accounting was filed in the Chancery Division of fhé Circuit Court of Cook County on November 20, 1972. A petition to transfer the cause to the Probate Division was filed on January 5, 1973, and denied on February 16, 1973. Subsequently, a motion for summary judgment with an affidavit was made by the plaintiff and a counter motion with supporting affidavits was made by the defendant. Judgment was entered on the plaintiff’s motion on July 5, 1973. The defendant appeals from that judgment.

, The plaintiff contends it was not shown there was donative intent by the. decedent with respect to the defendant at. the inception of the accounts, and that at the time of the creation of the joint accounts, the decedent placed her name on the accounts only for the purpose of providing care for his father.

The defendant testified that at the time Lawrence Pochman .put her name on the accounts as a joint tenant, he requested she should use' the funds to take care of his father if he should die first. After the death óf his father, 'Lawrence Pochman told her that if anything was left in the accounts when he died, she should have it for her own. There was also testimony that Lawrence Pochman intended to convey his house to the defendant.

Donative intent is presumed to exist at the inception of a joint tenancy savings account and may be rebutted only by clear and convincing evidence to the contrary. In Murgic v. Granite City Trust it Savings Bank (1964), 31 Ill.2d 587, the court stated:

“[A]n instrument creating a joint account under the statutes presumably speaks the whole truth; and, in order to go behind the terms of the agreement, the one claiming adversely thereto has the burden of establishing by clear and convincing evidence that a gift was not intended. This burden does not shift to the party claiming under the agreement.” 31 Ill.2d at 591.

Although neither this court nor the court below had the benefit of reading the joint tenancy contract, and we cannot understand why such an important document was not offered into evidence, it' appears from the other evidence the decedent did intend at the inception of the joint accounts that the defendant have the money in the accounts contingent upon the deaths of his father and himself. The defendant was his godchild, and apparently the only relative about whom he cared. Significantly, the decedent did not take the defendant’s name off the accounts after his father died almost 2 years prior to his own death, and he did not make a will. It may be inferred from these circumstances the decedent considered no will was necessary in light of the joint accounts and his expressed desire to deed his house to the defendant during his lifetime.

The fact the decedent expressed a desire that the defendant should take care of his father with the funds if his father should survive him is not inconsistent with the existence of donative intent from the creation of the accounts. In the case of In re Estate of Hayes (1971), 131 Ill.App.2d 563, the court stated:

“The fact that she told Anna that she wanted her to make withdrawals if she became ill does not mean that she did not intend Anna to have whatever money remained in the accounts at the time of her death.” 131 Ill.App.2d at 569.

We think the judgment of the Circuit Court was error in the instant case.

For these reasons the judgment of the Circuit Court of Cook County is reversed.

Reversed.

BURMAN and JOHNSON, JJ., concur.


author: Mr. JUSTICE HALLETT

text:
    State Farm Mutual Automobile Insurance Co., Plaintiff-Appellee, v. Allstate Insurance Co., Defendant-Appellee—(Daniel C. Osmon, Defendant-Appellant.)
    (No. 56916;
    May 20, 1974.

      Herbert F. Stride, of Chicago (William J. Harte, of counsel), for appellant.
    Hinshaw, Culbertson, Moelmann, Hoban & Fuller, of Chicago (John L. Kirkland, D. Kendall Griffith, and Thomas M. Hamilton, Jr., of counsel), for appellee.
   Mr. JUSTICE HALLETT

delivered the opinion of the court:

The defendant, Daniel C. Osmon, appeals from a summary judgment granted to the plaintiff, State Farm Mutual Automobile Insurance Company, and to Allstate Insurance Company, another defendant, in an action for declaratory judgment to determine the respective rights and obligations of the companies under their respective policies of insurance. He contends that there was a valid and substantial factual dispute as to whether either or both of the companies were required to extend coverage to the defendant driver in a personal injury suit for damages sustained by the defendant, Osmon, as a result of an automobile collision. He urges that the trial court ruled improperly when it determined that neither Allstate, which insured the owner of the vehicle, which was being driven by one J. F. Richter, nor State Farm, which insured the defendant Richter’s father, was obligated to extend coverage to the defendant, Richter.

This dispute arises out of an automobile accident, which occurred on February 15, 1969, in which a vehicle owned by Mrs. Frances Konenski and driven by John F. Richter allegedly struck the defendant in this action, Daniel Osmon. With Richter in the vehicle at the time of the accident were two of Mrs. Konenski’s daughters, Judy, age 14, and Laurie, age 7. When the incident occurred Richter, Mrs. Konenski’s daughters and two friends were driving around, waiting for Mrs. Konenski’s other daughter, Sheryn, age 17, to finish work. Sheryn Konensld was John Richter’s girlfriend, and she had been going out with him for approximately lVz years at the time of the accident. After the collision, Daniel Osmon filed suit for personal injuries in the circuit court of Cook County against Richter, Mrs. Konenski, and Judy Konenski. Subsequently State Farm instituted this action for declaratory judgment after Allstate Insurance had refused to defend or extend coverage to Richter on the ground that he was not a permitted user of the vehicle within the terms of Allstates’ policy of automotive insurance. State Farm, which had issued an automotive liability policy to Richter’s father, similar to the Allstate policy in question (which would provide excess coverage), contended that if Richter was not a permitted user, then the State Farm policy also was not applicable. After considering the affidavits and briefs submitted by the respective parties, the trial judge concluded that there was no factual basis to support a conclusion that John Richter was a permitted user of the Konenski vehicle. We affirm that conclusion and the judment.

In reaching his determination that John Richter was driving the Konenski car without permission, the trial judge considered the following facts. John Richter had been Sheryn Konenski’s boyfriend for about years at the time of the accident. None of the Konenski girls was ever permitted to use the car, and none of them had a driver’s license or permit. On several occasions, when John and Sheryn were first dating, Mrs. Konenski had permitted John Richter, who had a permit, to drive the vehicle in her presence. However, for several months prior to the night before the accident, John Richter had not been welcome in the Konensld home. On tire night before the accident Mrs. Konenski had allowed John Richter to stay at her apartment because he had left home. On one occasion, when Mrs. Konenski was still on good terms with Richter, she had given him permission to bring her car home from the gas station where it was being repaired, without being present in the vehicle. On two occasions Sheryn and John had also taken the vehicle without permission, and when Mrs. Konenski found out about one of these rides, she had become quite angry with Richter.

On the day of the accident, Mrs. Konenski had asked Richter to drive her to a doctor’s appointment and then to a meeting, as her hand was in a cast. She then asked him to return the car directly to her apartment. Richter returned the car, but not directly, at about 1 P.M. He then returned later that same afternoon, after Mrs. Konenski had gone to work, and asked Judy Konenski, who was baby-sitting for her sister Laurie, if she would like to go for a ride, while he waited for Sheryn, He asked her to get the keys from her mother’s room, which she did, Judy took Laurie with her, and then she and Richter proceeded to pick up two of their mutual acquaintances, whom they took for a ride, while waiting for Sheryn to accompany them to a drive-in movie. It was during this time that the accident occurred. John Richter left the scene of the accident without waiting for the police and, when questioned by Mrs. Konenski about the damage to her car, he told her that he had hit a dog, and paid her to have it repaired so' that she would not call the police.

The defendant Osmon contends that there are two ways in which John Richter could be considered an authorized user of the. Konenski vehicle, under the tests outlined in the landmark case of Hays v. Country Mutual Insurance Co. (1963), 28 Ill.2d 601, 192 N.E.2d 855, where our supreme court stated at 608-609 that:

“Of course the named insured may by express authorization delegate to his permittee the power to grant permission to others, and circumstances surrounding the original permission may support an implication of such an authorization. Thus where the permittee is in every practical sense the owner of the car, and the named insured holds title for convenience, the general custody and control of the permittee is usually held to empower him to grant permission to others within the scope of an omnibus clause, at least in the absence of express prohibition. (See, e.g., Hinckley v. National Surety Co., 99 N.H. 373, 111 A.2d 827 (1955); Fireman’s Fund Indemnity Co. v. Freeport Insurance Co. 30 Ill.App.2d 69; cf. Nonis v. Pacific Indemnity Co. 39 Cal.2d 420, 247 P.2d 1 (1952).) If the original permittee retains control of the car, but turns over its physical operation to a third person while remaining a passenger, an implied permission has been found in the continued use and control of the original permittee. (See Standard Accident Insurance Co. v. New Amsterdam Casualty Co. 249 F.2d 847 (7th cir. 1957); Fireman’s Fund Indemnity Co. v. Freeport Insurance Co. 30 Ill.App.2d 69.) Even where the original permittee is not a passenger, an inference of permission has been sustained where the third person is engaged on some errand or activity for the benefit, advantage, or purposes of the original permittee. (See Aetna Life Insurance Co. v. Chandler, 89 N.H. 95, 193 Atl. 233 (1937).) A course of conduct, establishing that the original permittee was allowing third persons to drive with the knowledge of the named insured and without his objection, may also support a finding of implied permission. See, e.g., Odden v. Union Indemnity Co. 156 Wash. 10, 286 Pac. 59 (1930); Shoup v. Clematis, (Ohio App.), 31 N.E.2d 103 (1939); cf. Goff v. New Amsterdam Casualty Co. 318 Ill.App. 586.”

It is argued that Richter was a permitted user because he received the keys of the vehicle from July IConenski, who had been given control of them by her mother, and that Judy and Laurie were present in the car, and therefore were, in effect, using the vehicle in question. We disagree, because the keys to the vehicle were not left in the control of Judy Konensld, aged 14 years, who was never allowed to drive the car and had no permit to do so. Mrs. Konenski did not leave the keys to the vehicle in Judy’s control, and she and her sister could not in any sense be considered to be using the car, since they were too young to drive and were merely accompanying John Richter at his request.

The recent decision of our Supreme Court in Maryland Casualty Co. v. Iowa National Mutual Insurance Co. (1973), 54 Ill.2d 333, 341-342, 297 N.E.2d 163, discussed the issue of implied permission, and concluded that it was necessary for the owner of the vehicle initially to hand over the keys of the vehicle before permission can be inferred.

“Illinois has long followed the rule that if the named insured has initially given permission to another to use the insured vehicle, a deviation from the authorized use does not serve to terminate the permission. As stated in Konrad v. Hartford Accident & Indemnity Co. 11 Ill.App.2d 503, When the named insured has initially once given permission to another person to use his motor vehicle but that person deviates from the permission granted, Illinois follows the so-called initial permission rule to the effect that the user need only to have received permission to take the vehicle in the first instance, and any use while it remains in his possession is with permission,’ under the omnibus clause, though that use may be for a purpose not contemplated by the named insured when he parted with possession of the vehicle; if the original taking by the user is with the named insured’s consent, every act of the user subsequent thereto while he is driving the vehicle is with the named insured’s permission so far as the omnibus clause is concerned, assuming there is no termination of permission; a deviation from the permission is immaterial; the only essential thing is that permission be given in the first instance; the rule is based on the theory that the insurance contract is as much for the benefit of the public as for the insured, and that it is undesirable to permit litigation as to the details of the permission and use * * *.' 11 Ill.App.2d 503, at 514-5.” (Emphasis ours.)

Mrs. Konenski told Richter to return the car directly early that afternoon. This was done, and his permission terminated. He did not request the use of the vehicle again. And since Judy Konenski did not have control of the keys to the automobile, John Richter did not have implied permission from Mrs. Konensld to use the vehicle.

Nor are we impressed with the argument that a benefit was conferred on Mrs. Konenski, because Judy Konenski took her sister with her on the ride, because she was too young to be left alone in the apartment. There was no need to use the automobile to confer this benefit. Judy was supposed to be caring for her sister at home, not taking her out for an unauthorized ride. There is no benefit to a mother to have her daughter out riding with an unlicensed driver and involved in a hit-and-run accident, and this contention is without merit.

Similarly, with respect to defendant Osmon’s discussions of negligence with respect to Mrs. Konenski and her daughter Judy, we see no relevance with respect to the issue raised on this appeal, i.e., whether John Richter was a permitted user of the Konenski vehicle. Allstate has not refused to defend or extend coverage to the Konenski’s and thus the terms of the amended complaint, as it relates to those defendants in the personal injury suit are not relevant to the issue presented in this appeal, as their negligence does not make Richter a permitted driver under the terms of the Allstate policy.

Finally the defendant contends that John Richter is covered by the fifth (omnibus) provision of the Allstate policy. The relevant sections of that policy read:

“The following persons are insured under this Part
1. The named insured, with respect to the owned or a non-owned automobile;
2. Any resident of the named insureds’ household with respect to the owned automobile;
3. Any other person with respect to the owned automobile, provided the actual use thereof is with the permission of the named insured;
4. Any relative with respect to a non-owned private passenger automobile or trailer not regularly furnished for use of such relative; and
5. Any other person or organization with respect to any automobile or trailer, provided:
(a) the actual use is hy a person who is an insured under any of the four preceding paragraphs, with respect to such automobile or trailer, and (b) such other person or organization is legally responsible for the use and, except with respect to a temporary substitute automobile, does not own or hire the automobile or trailer.
The insurance afforded under this Part 1 applies separately to each insured against whom claim is made or suit is brought, but the inclusion of more than one insured shall not operate to increase the limits of Allstate’s liability.” (Emphasis ours.)

It is plain from the language of the policy that the user must eome within one of the first four categories of the policy before the fifth (omnibus) clause may even be considered and, as we have already held, since John Richter was not a permitted user, the omnibus provisions provided no coverage.

We therefore affirm the judgment.

Judgment affirmed.

BURKE and GOLDBERG, JJ., concur.


author: Mr. JUSTICE BURICE

text:
    Patrick Crowley, Plaintiff-Appellant, v. A-North Shore Driving School, Defendant-Appellee.
    (No. 57834;
    First District (1st Division)
    May 20, 1974.

      John R. Ryan, of Chicago, for appellant.
    Wildman, Harrold, Allen & Dixon, of Chicago (James P. Dorr and Robert E. Haley, of counsel), for appellee.
   Mr. JUSTICE BURICE

delivered the opinion of the court:

This is an action for personal injuries allegedly incurred by the plaintiff in the course of administering a driving test to a student of defendant driving school. At the close of the plaintiff’s evidence, the court directed a verdict in favor of defendant. Plaintiff appeals.

At the trial, plaintiff testified that on June 28, 1967, the date of the occurrence, he was a State of Illinois driver’s license examiner at the North Elston Avenue facility in Chicago, Illinois. He testified that an A-North Shore Driving School instructor named Bill presented a woman named Joan for a driving test. Plaintiff testified that the instructor drove the A-North Shore Driving School vehicle up to the starting line for the driving course. The instructor exited the vehicle and the applicant Joan moved over to the driver’s seat. The instructor Bill then stated to plaintiff, “She’s ready, take her out.”

Plaintiff further testified that he entered the vehicle and was seated on the passenger side of the vehicle. He gave the driver a brief outline concerning the driving course and then they commenced the road test. Plaintiff testified that during the course of the road test, the driver struck a stationary abutment, namely a signal box, and as a result thereof, he was injured.

Plaintiff testified that after the accident, he had x-rays taken and that there was an injury to his right shoulder. He testified that his shoulder was treated with a hot water bottle.

On cross-examination, plaintiff was asked and he responded affirmatively that during his deposition on May 11, 1971, the following colloquy transpired:

(Defense Counsel) “Q — Did you have any conversation with the applicant’s driving instructor from North Shore prior to her getting into the car, regarding this specific applicant?

(Plaintiff) A — I can’t recall. We probably' said, ‘Hi, how are you,’ something like that. That would be it, because they would drive the applicant up to the course and I would tell her to move over and get in the car. I imagine I said, ‘Good morning,’ or ‘Good afternoon, how are you doing?’ ”

He further testified that the driving applicant had performed well on the driving course prior to the time she struck the abutment.

At the conclusion of plaintiff’s testimony, he rested his case. Defendant moved for a directed verdict on the basis that plaintiff had failed to prove negligence on the part of defendant and that plaintiff had failed to prove any damages. The court granted defendant’s motion for a directed verdict. Plaintiff appeals from the judgment entered thereon.

In determining the propriety of the directed verdict, we shall apply the standard enunciated by the Illinois Supreme Court in Pedrick v. Peoria & Eastern Ry. Co., 37 Ill. 2d 494, 510, 229 N.E.2d 504, 513-14:

“[V]erdicts ought to be directed * * * only in those cases in which all of the evidence, when viewed in its aspect most favorable to the opponent, so overwhelmingly favors movant that no contrary verdict based on that evidence could ever stand.”

Plaintiff argues that defendant is liable on a theory of' negligent entrustment. In support of his argument, plaintiff maintains that Illinois courts recognize liability arising from the act of entrustment of an automobile to one whose incompetency, inexperience or recklessness is known or should have been known by the owner of the vehicle. Dyreson v. Sharp, 333 Ill.App. 198, 76 N.E.2d 809.

Plaintiff offered no evidence to indicate that defendant knew .or should have known that the driver, later identified as Joan I. Noah, was incompetent, inexperienced or reckless. Therefore, the trial court was correct in directing a verdict in favor of defendant and against plaintiff as to the negligent entrustment allegation.

Plaintiff next argues that the doctrine of res ipsa loquitur is applicable. We disagree.

Before the doctrine of res ipsa loquitur can be applied, it is necessary to prove the defendant’s control of the immediate cause of the injury is exclusive; the doctrine cannot be invoked without evidence tending to establish that the injury complained of was caused by someone under defendant’s control. (Roberts v. City of Sterling, 22 Ill.App.2d 337, 161 N.E.2d 138.) Plaintiff has not made such a showing.

Plaintiff argues that the doctrine of strict liability in tort is applicable because defendant’s business is hazardous and the risk to the public is dependent upon the expertise of the operator. In support of his argument plaintiff relies upon sections 388 to 391 of the Restatement of Torts (Second). We have examined the sections cited and are of the opinion that they have no application to the factual situation of the instant case.

Plaintiff also relies upon the recent decision of Galluccio v. Hertz Corp., 1 Ill.App.3d 272, 274 N.E.2d 178. The doctrine of strict liability in tort under section 402(A) of the Restatement of Torts (Second) was adopted by the Illinois Supreme Court in Suvada v. White Motor Co., 32 Ill.2d 612, 210 N.E.2d 182, In Galluccio, the Illinois Appellate Court for the Fifth District expanded the doctrine of strict liability in tort discussed in section 402(A) of the Restatement to bailor-bailee relationships. We are, however, of the opinion that Suvada and Galluccio are distinguishable from the present case. In both Suvada and Galluccio, the defendants introduced into the stream of commerce products with defects which were unreasonably dangerous, namely defective braking systems. In the present case there is no evidence that the automobile in which plaintiff was allegedly injured contained a defective condition.

Plaintiff argues that defendant and the driver of the vehicle were engaged in a joint venture and that the liability of either is chargeable to both.

As the Illinois Appellate Court for the Second District stated in Johnson v. Turner, 319 Ill.App. 265, 280, 49 N.E.2d 297, 304:

“Negligence in the conduct of another will not be imputed to a party if he did not authorize such conduct, participate therein, or have the right or power to control it.”

See also Babington v. Bogdanovic, 7 Ill.App.3d 593, 288 N.E.2d 40.

In the present case there is no proof that defendant authorized, participated in or had the right or power to control the conduct of the driver, Joan I. Noah, and consequently the doctrine of joint venture is inapplicable.

Plaintiff argues that legislative intent precludes denial of liability by the operator of a driver training school for the acts or omissions of a driving student. The argument is premised upon paragraph 6 — 113(5) of chapter 95½, Ill. Rev. Stat. 1967, ch. 95½, par. 6 — 113(5).

The aforesaid statutory reference upon which plaintiff relies provides, inter alia, that driver training schools:

“5. Maintain bodily injury and property damage liability insurance on motor vehicles while used in driving instruction, insuring the liability of the driving school, the driving instructors and any person taking instruction in at least the following amounts: $50,-000 for bodily injury to or death of one person in any one accident and, subject to such limit for one person, * *

We are of the opinion that this statute does not impose, as plaintiff suggests, “absolute liability.” The requirement of liability insurance does not remove the plaintiffs burden of proving negligence or fault of one of those covered by the insurance.

In the present case, plaintiff did not prove that the defendant A-North Shore Driving School or its agent, the driving instructor, was negligent. Plaintiff’s counsel during a colloquy with the trial judge concerning defendant’s motion for a directed verdict stated: “I don’t see how she (Joan I. Noah) could be negligent.” Under these circumstances, we conclude that paragraph 6 — 113(5) of chapter 95½ (Ill. Rev. Stat. 1967, ch. 95½, par. 6 — 113(5)) has no application.

For these reasons, the judgment is affirmed.

Judgment affirmed.

EGAN, P. J., and HALLETT, J., concur.