author: PRESIDING JUSTICE BILANDIC

text:
    KELLY LYNN CISARIK, a Minor, by Nancy Cisarik, her Mother and Next Friend, et al., Plaintiffs, v. PALOS COMMUNITY HOSPITAL et al., Defendants (Ann Herbert, Contemnor-Appellant).
    First District (2nd Division)
    No. 1—88—1139
    Opinion filed December 29,1989.

      Barry D. Goldberg, of Goldberg & Goldberg, and David A. Novoselsky & Associates, both of Chicago (David A. Novoselsky and Kathleen M. Krist, of counsel), for appellant.
    Hinshaw, Culbertson, Moelmann, Hoban & Fuller, of Chicago (D. Kendall Griffith, E.' Michael Kelly and Joshua G. Vincent, of counsel), for appellee.
   PRESIDING JUSTICE BILANDIC

delivered the opinion of the court:

Plaintiff, Kelly Lynn Cisarik, a minor, by her mother and next friend, brought this action for damages alleging that defendants were negligent in providing certain medical services. On October 13, 1987,

the attorneys for one of the defendants wrote to counsel for plaintiff:

“If you are planning to use a ‘day in the life’ movie at trial I would ask your agreement on certain points:
—Since I consider such movies to be akin to tests I would ask for notice when the movie is being made;
—I would ask that the opposing attorneys have the option to have an observer present;
—I would ask, at my expense, for a copy of all film shot.
If you disagree with these points, please advise and we can take the matter up with Judge Foreman on November 2, 1987.”

On December 8,1987, counsel for the plaintiff responded:

“I am planning to take a ‘day in the life’ film of my client and do not agree with your perspective and I do not intend to permit you or any Defendant to be present at the filming of said film. I suggest you take whatever action in that regard that you wish. You will be given a copy of the film at your expense as requested.”

Thereafter, defendant moved for an order in accordance with its request. After a hearing, the trial court entered an order allowing all defendants to be present during the filming of a “day in the life” movie of Kelly. The order also provided that: (1) defendants were to be given notice of the making of the film; (2) the film was to be preserved in its entirety; and (3) the film was to be made available to all defendants.

This appeal arises from an order entered by the circuit court of Cook County on April 7, 1988, holding Ms. Ann Herbert, an attorney for plaintiff, in contempt. Ms. Herbert was held in contempt and fined $100 when she refused to comply with the court’s order, believing that defendants had no right under Illinois law to be present during the filming.

As a preliminary matter, we note that this is a case of first impression in Illinois. Under the facts of this case, we conclude that Ms. Herbert’s refusal was a good-faith effort to secure an interpretation of an issue without direct precedent in this State. By subjecting herself to a contempt citation, she exercised a permissible method of testing a pretrial order. Bicek v. Quitter (1976), 38 Ill. App. 3d 1027, 350 N.E.2d 125.

Until relatively recent times, the use of motion pictures in the trial of personal injury cases has been the domain of the defendants. In 1935, the ABA Journal reported the use of films to expose malingering plaintiffs. (Sweet, The Motion Picture as a Fraud Detector, 21 A.B.A. J. 653 (1935).) Even at this time, “the most common use of motion pictures as evidence today is to refute the extent of disability claimed by plaintiffs in personal injury cases ***. Indeed this use * * * has become so common that in almost every city telephone directory will be found advertisements of industrial motion picture photographers stating that they specialize in this type of work.” 2 C. Scott, Photographic Evidence §729 (2d ed. 1969).

“In recent years increasing evidential use has been made of what have been called ‘day in the life’ films and videotapes of persons whose injuries are in question in litigation.” 3 C. Scott, Photographic Evidence §1315 (2d ed. Supp. 1987).

It is well established that motion pictures, when properly authenticated and relevant, are admissible into evidence. For a long time, Illinois courts have upheld the use of motion pictures to expose a malingering plaintiff. See McGoorty v. Benhart (1940), 305 Ill. App. 458, 27 N.E.2d 289.

“Day in the life” films were first considered in Illinois in 1986 when this court approved the use of such a film in Barenbrugge v. Rich (1986), 141 Ill. App. 3d 1046, 490 N.E.2d 1368, appeal denied (1986), 112 Ill. 2d 570. Again, in 1987, the use of such films was approved in Georgacopoulos v. University of Chicago Hospitals & Clinics (1987), 152 Ill. App. 3d 596, 504 N.E.2d 830. These are the only reported Illinois cases on the subject.

Defendants in the case at bar do not dispute the admission of “day in the life” films. Here the issue is the extent to which the defendants can participate in plaintiff’s preparation of evidence that may be used at trial.

Since a pretrial order is involved in this appeal, in the interest of judicial economy, it may be well to consider a pretrial order that may apply to both parties in the preparation of their respective cases. With the extensive use of video by both sides, “[w]e need — but do not have — systematic, organized discovery procedures that insure disclosure of trial videotapes far enough in advance of trial so that information can be gathered and an effective rebuttal planned.” (Chernow, Video in the Courtroom: More than a Talking Head, 15 Litigation 3, 6 (1988).) We will provide such a procedure for purposes of this case.

The principal controversy with the trial court’s order is that it permits each party to have one attorney present “to observe the making of said film” and “[i]n the event the attorney for the plaintiffs asks questions of any individual depicted in the film, each defense attorney shall have the right to conduct a cross-examination of that individual.” The reasoning of the trial court is reflected in the following statement: “Therefore, I find that this being consistent with an evidence deposition in that the provisions for the taking of an evidence deposition really and truly ought to be applied for this ‘Day in the Life’ video.” We disagree.

An evidence deposition is a substitute for the appearance of a witness at trial. It is real evidence presented in the same manner as it would be at trial. This is different from the preparation of a “day in the life” film, which is not evidence. It becomes evidence only after it is offered and admitted after passing rigorous safeguards dealing with its authenticity and relevance.

If a “day in the life” film is considered to be like an evidence deposition, then shouldn’t the same standard be applied to surveillance-type films prepared by the defendants for possible use as evidence against the plaintiff?

In the case at bar, plaintiff has indicated her intent to prepare a “day in the life” film. The film may be prepared by the plaintiff without the presence of any representative of the defendants. However, all of the film taken must be preserved, whether or not included in the final edited version of the proposed presentation. Prior to trial, during the period of discovery, defendants shall be entitled to view all of the film taken and to take the discovery deposition of the plaintiff’s authenticating witness or witnesses. In addition, defendants may use any film taken and not used by the plaintiff and use it as their own evidence, if it is otherwise admissible.

Likewise, in response to an appropriate interrogatory, defendants shall disclose to the plaintiff the existence of any film that they intend to use to refute the extent of plaintiff’s alleged disability. Prior to trial, during the period of discovery, plaintiff shall be entitled to view all of the film taken and to take the discovery deposition of the defendants’ authenticating witness or witnesses. In addition, plaintiff may use any film taken and not used by the defendants and use it as her own evidence, if it is otherwise admissible.

We therefore conclude that the order of the trial court requiring the presence of counsel for defendants at the preparation of plaintiff’s film for possible use at trial is reversed, and this cause is remanded for further proceedings in accordance with the views expressed herein.

Where noncompliance with an order by an attorney raises an issue of first impression, the resulting contempt order and fine shall be set aside. (Consolidated Coal Co. v. Bucyrus-Erie Co. (1982), 89 Ill. 2d 103, 432 N.E.2d 250.) Accordingly, the order holding Ms. Ann Herbert, plaintiff’s attorney, in contempt and imposing a fine for said contempt is vacated.

Accordingly, the judgment of the circuit court of Cook County is reversed, and this cause is remanded for further proceedings consistent with the views expressed herein.

Reversed and remanded.

DiVITO and HARTMAN, JJ., concur.


source: Caselaw Access Project

author: JUSTICE RIZZI

license: Public Domain

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. NATHAN PALMER, Defendant-Appellant.
    First District (3rd Division)
    No. 1—87—3544
    Opinion filed December 29,1989.

      Randolph N. Stone, Public Defender, of Chicago (Stephanie L. Ellbogen, Assistant Public Defender, of counsel), for appellant.
    Cecil A. Partee, State’s Attorney, of Chicago (Inge Fryklund, Kenneth McCurry, and Judith M. Gilson, Assistant State’s Attorneys, of counsel), for the People.
   JUSTICE RIZZI

delivered the opinion of the court:

Following a bench trial, defendant Nathan Palmer was found guilty of three counts of criminal sexual assault and sentenced to serve four years in the Illinois Department of Corrections. On appeal, defendant argues that he was not proven guilty beyond a reasonable doubt. We affirm.

The following facts are undisputed. On December 17, 1986, at approximately 10:30 p.m., Mitzi Scott was trying to place a phone call at a pay telephone located at a fire station at Larabee and Division Streets in Chicago. Mitzi was unable to reach the party she was calling and began to speak with defendant, who was standing nearby. Mitzi and defendant had known each other for about one or two years, and defendant had visited her in her home on at least one occasion. Mitzi asked the defendant for a cigarette, and he went to the store across the street, purchased a package of cigarettes and gave her two. At approximately midnight, defendant walked Mitzi back to her apartment building, which was in a Chicago Housing Authority complex across the street. Mitzi went to her apartment and began to cook dinner.

Defendant purchased some marijuana and later stopped by Mitzi’s apartment to make sure she had gotten home safely. When defendant arrived Mitzi was cooking dinner, and she invited him in to visit. Defendant joined Mitzi in the kitchen while she finished cooking her meal. Defendant offered Mitzi a marijuana cigarette and they smoked it together. Mitzi offered defendant some food, but he told her he was not hungry, so she fixed herself a plate of food, and they went into the living room and watched television while Mitzi ate her dinner. When Mitzi finished eating, she went to the kitchen, and defendant followed her to get his coat so that he could leave. At this point Mitzi’s and defendant’s versions of the events diverge.

Mitzi testified that she got another glass of Kool Aid and defendant got his coat. She stated that she began to walk back toward the living room with defendant following behind her. She testified that as she reached the hallway, defendant grabbed her from behind, placed his right arm around her neck and his left arm underneath her shoulder and told her to put her cup on the closet shelf located in the hallway. Mitzi testified that after she placed the cup down, defendant turned her around in the opposite direction and began to push her from behind. She stated that she took a couple of steps and then told defendant to stop. Mitzi testified that defendant stated, “[Y]ou are going to give me some pussy.” Mitzi asked defendant what was happening, and he repeated the above phrase.

Mitzi then began to plead with defendant and tell him that he didn’t want to do this and that it didn’t have to be this way. Defendant continued to push Mitzi down the hallway while she tried to push him back. Defendant pushed Mitzi up against the wall next to the bathroom, and Mitzi told him that she didn’t sleep with someone just because they wanted to sleep with her. Defendant slapped her in the face and told her to take off her clothes. Mitzi testified that she began to size defendant up and try to figure out what to do. She stated that since defendant was six feet tall and weighed 200 pounds, she decided to cooperate while still trying to talk her way out of the situation. She stated that she took off her shirt, shorts and underpants. Defendant then grabbed her arm and forced her into her son’s room.

Defendant stood in the doorway and began to take off his clothes. When defendant got his pants down to his shins, Mitzi ran into him and knocked him down. She attempted to run past defendant, but he grabbed her by the ankle, and she fell to the floor. She and defendant began to wrestle. Mitzi testified that defendant tried to get on top of her and that she kicked and pushed him away while inching her way down the hallway towards the front door. After the struggle moved about half-way down the hall, defendant got on top of Mitzi and began to choke her. Mitzi began pushing defendant’s face with her hand, her thumb slipped into his mouth and he began to bite her left thumb.

Mitzi testified that she managed to reach her front door, get it unlocked and scream for.her neighbor, but no one responded. She further stated that she bit defendant’s lip to try to get her thumb out of his mouth, and defendant stood up, grabbed her by her hair and pulled her down the hall to her son’s bedroom. Mitzi testified that when they got to her son’s room, she got to her feet and defendant tried to close the door while she attempted to keep it open with her foot. She testified that she was exhausted from the struggle, and defendant closed the door. Defendant pushed her down on the bed facing him and told her to perform oral sex on him. Defendant grabbed Mitzi by the head while she begged him not to do this to her, and he put his penis in her mouth. Mitzi kept telling defendant that she was going to get sick and after about three minutes, defendant removed his penis from her mouth. Defendant pushed Mitzi down on the bed and performed oral sex on her. Mitzi continued to ask defendant to stop. Defendant then got up and put his penis in Mitzi’s vagina for about five minutes, after which he got up, told her to lay lengthwise on the bed and put his penis into her vagina again for about 10 minutes. Defendant complained that he could not maintain his erection and began to pace the floor and say that he was scared, sorry and did not want to go to jail.

Mitzi told defendant that her finger was hurting, and defendant asked her if anyone else had a key to the apartment. Mitzi told defendant that she was expecting a friend for dinner. Defendant took Mitzi to the front door, checked the lock, put the chain on the door and took her back to her son’s room. Defendant closed the bedroom door, removed a pillowcase from the pillow and threatened to choke Mitzi with it, stating he would rather jump out of the window than go to jail. Mitzi pleaded with defendant not to kill her because she had to take care of her baby. Defendant told Mitzi that if she hollered he would strangle her with the pillow case. Mitzi promised not to holler. Defendant put his penis into Mitzi’s vagina again for about 10 minutes and then stopped and sat on the side of the bed. Mitzi asked defendant if he had any sisters or daughters and how would he feel if someone did this to them. Defendant then started to cry and apologize. Mitzi promised not to tell anyone if defendant allowed her to live to raise her baby Defendant then made the victim stand up and turn around and he put his penis into her vagina again for about 15 minutes before finally ejaculating.

Defendant apologized to the victim and asked her if she wanted to go to the hospital for her thumb injury. Defendant then washed the blood off of Mitzi and himself and gave her a dollar to get home from the hospital. After Mitzi and defendant were dressed, defendant locked her apartment door and took her to the fire department to call an ambulance. When they arrived at the fire department, defendant told the fireman on duty, who was a friend, that Mitzi had injured her finger in a fight and needed an ambulance. The fireman cleaned and bandaged the victim’s finger and called an ambulance. When the ambulance arrived, defendant borrowed some money from the fireman and gave it to Mitzi. Mitzi was taken to Grant Hospital and treated for her thumb injury. She also reported her sexual assault to the hospital staff after talking with her boyfriend by telephone. Mitzi received two stitches to her thumb, and a vaginal swab sample was taken.

Defendant made a pretrial statement which was admitted into evidence. In his statement, defendant admitted that he grabbed Mitzi around the shoulder and asked her for sex while they were standing in the hallway of her apartment. Defendant further stated that he took the victim into the bedroom and that she removed her clothes. Defendant admitted that Mitzi tried to get out of his grasp and that they started wrestling on the floor. Defendant stated that he took Mitzi to the bed, and she asked him if he was going to kill her. Defendant told the victim that he would not hurt her. Defendant admitted having vaginal and oral sex with Mitzi. Defendant stated that Mitzi showed him her bleeding thumb and he stopped having sex with her and apologized for what he had done. Defendant then offered to give her a dollar for carfare to the hospital. Defendant helped the victim get dressed, dressed himself and apologized again. Defendant then took Mitzi to the fire station, borrowed some money from a friend, gave it to Mitzi for cab fare and waited with Mitzi until the ambulance arrived.

Pictures of the victim’s son's bedroom with bloodstains on the bedspread and floor were admitted into evidence. In addition, the parties stipulated that the vaginal swab taken from Mitzi tested positive for sperm.

Defendant testified on his own behalf and stated that on the night he visited Mitzi’s apartment, Mitzi bumped into him in the hallway and he put his arms around her, kissed her and said let’s make some love. He further testified that Mitzi did not scream or push his arms away. He stated that he grabbed her hand and asked her to come in the back and that Mitzi did not pull away or scream. Defendant testified that they went into the bedroom and he asked her if they were going to make love. He stated that they kissed again and then they laid down on the floor and continued to kiss and caress each other. Defendant testified that while they were lying on the floor, Mitzi said that it did not have to be that way. Defendant stated that Mitzi took all of her clothes off before lying down on the floor. He testified that he never struck Mitzi and she did not scream or cry out. Defendant testified that he asked Mitzi to perform oral sex on him and that she agreed. He further testified that after approximately two minutes, he laid her on the bed and performed oral sex on her. Defendant stated that they then had intercourse with him on top and with Mitzi standing up and bending over.

Defendant testified that when Mitzi told him that her hand was “big,” he looked at it and told her she needed to go to the hospital. He stated that he never threatened to strangle her with the pillowcase, but admitted that he threatened to kill himself. Defendant stated that he had no idea how Mitzi injured her finger. He further stated that he washed the blood off of her thumb and helped her get dressed. Defendant testified that he walked the victim over to the fire station to call an ambulance. He stated that he waited with Mitzi until the ambulance came and gave her some money he borrowed from a friend at the fire station so that she could take a cab home.

Following closing arguments, the court found defendant guilty of three counts of criminal sexual assault. Following the sentencing hearing, the court sentenced defendant to serve four years in the Illinois Department of Corrections. This appeal followed.

Defendant argues that he was not proven guilty of criminal sexual assault beyond a reasonable doubt. It is his position that the State failed to prove that he used force to commit the act of sexual penetration. We disagree.

In sex offense cases, court of review are required to examine the evidence carefully and in order to sustain a conviction for criminal sexual assault, there must be evidence that defendant committed an act of sexual penetration by the use of force or threat of force. (People v. Walker (1987), 154 Ill. App. 3d 616, 621, 506 N.E.2d 1004, 1007; Ill. Rev. Stat. 1987, ch. 38, par. 12 — 13(a)(1).) The statutory definition of “force or threat of force” is “the use of force or violence, or threat of force or violence.” (Ill. Rev. Stat. 1987, ch. 38, par. 12 — 12(d).) In addition, in order to sustain a conviction for sexual assault, the testimony of the victim must be clear and convincing, or corroborated by some other facts and evidence. (People v. McKendrick (1985), 138 Ill. App. 3d 1018, 1024, 486 N.E.2d 1297, 1301.) The credibility of the complainant is an issue best determined by the trier of fact, who heard the testimony and observed the demeanor of the witnesses. (People v. Watts (1985), 139 Ill. App. 3d 837, 851, 487 N.E.2d 1077, 1087.) The facts of each case must be considered in determining whether defendant intentionally had intercourse with complainant against her will. (People v. Houck (1977), 50 Ill. App. 3d 274, 281, 365 N.E.2d 576, 581.) A reviewing court may not substitute its judgment for that of the trier of fact on questions involving the weight of evidence or credibility of the witnesses, and may not reverse a conviction unless the evidence is so unreasonable, improbable or unsatisfactory as to raise a reasonable doubt of guilt. People v. Nelson (1986), 148 Ill. App. 3d 811, 821, 499 N.E.2d 1055, 1062.

In the present case, the victim testified that defendant initially placed one of his arms around her neck and the other in her back and stated, “[Y]ou are going to give me some pussy.” When Mitzi refused, defendant pushed, slapped, choked, bit, and wrestled with her before he was able to subdue her. Mitzi further testified that when she was able to reach the front door and scream for help, defendant grabbed her by her hair and dragged her back to the bedroom. Once they were inside the bedroom, Mitzi continued to struggle with defendant in an attempt to keep him from closing the door. In addition, defendant removed a pillowcase from a pillow and threatened to choke Mitzi with it. Mitzi promised she would not tell anyone if defendant would allow her to live. The injury to Mitzi’s finger which required two stitches to repair is further evidence of defendant’s use of force to sexually assault her.

The victim’s lack of consent to participation in sexual intercourse was further evidenced by her knocking down in an unguarded moment in order to flee from the apartment. Also, defendant’s own pretrial statement and trial testimony revealed that defendant admitted that (1) he grabbed the victim around the shoulder and asked her for sex while they were in the hallway of the apartment; (2) the victim tried to get out of his grasp; (3) he and the victim struggled on the bedroom floor; (4) the victim told him that it did not have to be that way; (5) he told the victim that he would kill himself; (6) the victim asked him if he was going to kill her; (7) he apologized to the victim; and (8) the acts of sexual penetration occurred.

The testimony of the victim was both clear and convincing and corroborated by the victim’s injuries, pictures of the crime scene which showed bloodstains on the bed where the victim was sexually assaulted, and defendant’s own pretrial and trial statements. In addition, the court specifically found that the victim was more credible than defendant. In so finding, the court stated:

“[The] whole question is consent. As to every other single aspect of the case, there is complete corroboration, there is very little difference between her statement and his in the basic sense ***. I think the defendant had intercourse with her against her will, I’m going to find him guilty ***.”

After a review of the record, we cannot say that the totality of the evidence of force and resistance was so unsatisfactory as to leave a reasonable doubt that sexual intercourse was accomplished against the victim’s will. We find the victim’s testimony regarding the use of force to be both clear and convincing and substantially corroborated.

Accordingly, the judgment and sentence of the circuit court is affirmed.

Affirmed.

WHITE and CERDA, JJ., concur.


text:
    PIONEER SCREW AND NUT COMPANY, Plaintiff-Appellee, v. WASHINGTON NATIONAL INSURANCE COMPANY, Defendant-Appellant.
    First District (3rd Division)
    No. 1—88—0348
    Opinion filed December 29, 1989.
    Wildman, Harrold, Allen & Dixon, of Chicago (Roderick A. Palmore and Georgia L. Vlamis, of counsel), for appellant.
    Altheimer & Gray, of Chicago (David V. Kahn and Robert K. Blain, of counsel), for appellee.
   JUSTICE RIZZI

delivered the opinion of the court:

Defendant-appellant, Washington National Insurance Company (WNIC), appeals from an order of the circuit court of Cook County which granted summary judgment in favor of plaintiff-appellee, Pioneer Screw and Nut Company (Pioneer). On appeal, WNIC argues that the trial court erred in granting summary judgment in favor of Pioneer. We reverse.

Pioneer drafted and adopted the Pioneer Screw and Nut Company Group Benefit Plan (the Plan), which provided medical coverage for qualified employees and their dependents as of January 1, 1980. Pioneer subsequently entered into an individual stop-loss and aggregate stop-loss agreement with WNIC (the WNIC Agreement), effective January 1, 1985. The WNIC Agreement provided that WNIC would reimburse Pioneer for payment of expenses covered under the Pioneer Plan and the WNIC Agreement, after Pioneer had satisfied its $100,000 deductible.

Judith Hirsch, the wife of Pioneer’s chairman of the board, Howard Hirsch, was a covered dependent under the Pioneer Plan who experienced a mental illness which required hospitalization and treatment. Mrs. Hirsch refused to agree to voluntary treatment, and her spouse, Howard, instituted legal proceedings for her involuntary commitment and for the appointment of a guardian who would have authority to consent to medical treatment on her behalf. Mr. Hirsch, Mrs. Hirsch and the guardian each retained separate legal counsel to litigate the commitment issue. The attorney fees and psychiatrists’ witness fees totalled $132,254.50. Pioneer thereafter paid Howard Hirsch for the legal fees and expenses incurred in the involuntary commitment of his wife and sought reimbursement from WNIC. WNIC refused to reimburse Pioneer for the money expended for legal fees because, in its view, neither the Pioneer Plan nor the WNIC Agreement provided for reimbursement for legal fees and expenses.

In June 1987, Pioneer filed a complaint for declaratory judgment which requested that the court order WNIC to reimburse Pioneer for the money expended for legal fees and expenses in accordance with the terms of the Plan and the WNIC Agreement. Thereafter, both parties filed motions for summary judgment. After briefing and oral argument, the trial court entered an order granting summary judgment in favor of Pioneer and denying WNIC’s motion for summary judgment. This appeal followed.

On appeal, WNIC argues that the trial court erred in granting summary judgment in favor of Pioneer and in denying its motion for summary judgment. It is WNIC’s position that the express terms of the Plan and the WNIC Agreement preclude Pioneer’s recovery for legal expenses. We agree.

Section 3.2(d) of the Plan provides:

“3.2 Eligible expenses are defined as and limited to the following necessary expenses to the extent that they are usual and customary and are recommended by the attending physician:
* * *
(d) Expenses for medical care and treatment and the performance of a surgical procedure by a physician.”

In addition, the WNIC Agreement provides:

“H. Amounts actually paid shall mean the checks or drafts issued for payment of Individual Loss or Aggregate Loss but it shall not mean court cost; penalties; interest upon judgments; or investigation, adjustment or legal expense ***.”

When construing an insurance policy, the court’s primary concern is to give effect to the intent of the parties as expressed by the contract. (Strzelczyk v. State Farm Mutual Automobile Insurance Co. (1985), 138 Ill. App. 3d 346, 349, 485 N.E.2d 1230, 1232.) Where the words of an insurance policy can reasonably be given their plain, ordinary and proper meaning, the provisions should be applied as written and the parties should be bound to their agreement. Western Casualty & Surety Co. v. Brochu (1985), 105 Ill. 2d 486, 495, 475 N.E.2d 872, 876.

In the present case, the phrase “expenses for medical care and treatment” found in section 3.2(d) of the Plan in its plain and ordinary meaning simply does not include and makes no reference to attorney fees. Further, the WNIC Agreement specifically excludes reimbursement for legal expenses. Under these circumstances, the trial court’s ruling that the policy is ambiguous and that Pioneer is entitled to reimbursement for legal expenses as a matter of law is erroneous.

Summary judgment is appropriate if the pleadings, depositions and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. (McGowan v. Torres (1989), 184 Ill. App. 3d 589, 591, 540 N.E.2d 517, 518-19.) In reviewing a trial court’s entry of summary judgment, the reviewing court’s sole function is to determine whether the trial court correctly decided that there were no genuine issues of material fact, and if there were none, whether judgment for the movant was correct as a matter of law. International Amphitheatre Co. v. Vanguard Underwriters Insurance Co. (1988), 177 Ill. App. 3d 555, 571, 532 N.E.2d 493, 503.

Here, the trial court properly found that there were no genuine issues of material fact, but erred in entering judgment in favor of Pioneer and against WNIC. Because the plain language of the policy precludes coverage and reimbursement for legal expenses, the trial court should have entered summary judgment in favor of WNIC and against Pioneer.

Accordingly, the trial court’s order granting summary judgment in favor of Pioneer and against WNIC is reversed, and summary judgment is entered in favor of WNIC and against Pioneer.

Judgment reversed.

FREEMAN, P.J., and CERDA, J., concur.


text:
      In re MARRIAGE OF ADELINE WESTERLUND, Petitioner-Appellant, and RICHARD WESTERLUND, Respondent-Appellee.
    First District (3rd Division)
    No. 1—88—0674
    Opinion filed December 29,1989.

      James E. Land, of Calumet City, for appellant.
    Gary M. Kurc, of Dolton, for appellee.
   JUSTICE RIZZI

delivered the opinion of the court:

Petitioner-appellant, Adeline Westerlund (Adeline), appeals from an order of the circuit court of Cook County which directed her to pay $2,000 of defendant-appellee Richard Westerlund’s (Richard’s) attorney fees. We affirm.

Adeline and Richard were married on September 21, 1963. One child was born to the marriage on December 22, 1966. Adeline filed her petition for dissolution of marriage on November 3, 1984, alleging that Richard was guilty of extreme and repeated mental cruelty.

At the bench trial conducted in 1987, the parties testified as follows with regard to their respective incomes and expenses. Richard testified that he was currently unemployed and had been since 1980. He further testified that his monthly income was a $331 government stipend, and that he borrowed $8,000 to finance a mobile home purchase. Richard testified that his monthly expenses included $300 for food, $100 for utilities, $50 for clothes, and $43 for personal expenses. He further testified that his outstanding medical bills totalled $3,074. Adeline testified that her gross income for the previous year was $16,500. In addition, an affidavit filed by Adeline in 1985 indicated that her net monthly income was $954, while her expenses totalled $860.

Following trial, the court entered a judgment for dissolution of marriage. The court ordered that the parties’ marital property be divided as follows:

Adeline Item and Value Richard

$29,500 Marital Home — $59,000 $29,500

$13,452 Joint Bank Account — $27,084 $13,452

$ 5,815.50 IRA — $11,631 $ 5,815.50

$ 3,650 IRA — $7,300 $ 3,650

$ 800 Savings Account — $1,600 $ 800

as agreed Household Furnishings as agreed

all 1983 Ford none

The court ordered that the marital home be sold and the proceeds divided equally after the payment of expenses. In addition, Adeline was awarded her $7,000 pension, and Richard his $4,000 pension. The court found that Adeline was entitled to the following nonmarital property: one $39,052 savings account and one $16,691 savings account. Both parties were denied maintenance, and Adeline was ordered to pay Richard’s $3,074 medical bill either by referral to her insurance company or in cash. The court also ordered each party to pay his or her own attorney fees.

Thereafter, Richard moved to modify the judgment and argued, inter alia, that the court improperly ruled on the issue of attorney fees without determining need and ability. Richard’s attorney filed an amended petition and affidavit which included an itemized bill for his services, and a hearing was conducted. The court thereafter ordered that Adeline pay $2,000 of Richard’s $4,082 legal bill. This appeal followed.

On appeal, Adeline argues that the trial court abused its discretion in ordering her to pay $2,000 of Richard’s $4,082 legal bills. We disagree.

Section 503(a)(3) of the Illinois Marriage and Dissolution of Marriage Act (Act) provides that the trial court may order either party to pay a reasonable amount for attorney fees necessarily incurred by the other party in any proceeding under the Act. (Ill. Rev. Stat. 1987, ch. 40, par. 508(a)(3).) An award of attorney fees is justified where the spouse seeking relief demonstrates (1) financial inability to pay and (2) the ability of the other spouse to pay. (In re Marriage of Ryan (1985), 138 Ill. App. 3d 1077, 1082, 487 N.E.2d 61, 65.) Financial inability exists where the party seeking fees shows that payment would strip that person of his means of support and undermine his economic stability. (In re Marriage of Piceione (1987), 158 Ill. App. 3d 955, 964, 511 N.E.2d 1157, 1163.) The trial court’s decision will not be disturbed absent a clear abuse of discretion. Ryan, 138 Ill. App. 3d at 1082.

In the present case, Richard testified that his gross monthly income was $331, while his expenses were approximately $500 per month. In contrast, Adeline’s written affidavit indicated that her net monthly income was $954 and her expenses $860. In addition, as a result of the court’s distribution of marital and nonmarital property, after the judgment for dissolution of marriage was entered, Adeline had $69,195 while Richard had $15,052 in liquid assets. (These figures were calculated by the addition of the parties’ share of their joint savings account, Adeline’s nonmarital savings account,. and the entire balance of the parties $1,600 savings account, which was awarded to Richard by the court’s post-judgment modification.) Because Richard’s expenses exceeded his income and his present liquid assets were likely to be used to offset the difference, we find that the trial court did not err in finding that Richard was unable to pay all of his attorney fees. In addition, the record clearly demonstrates that Adeline possessed the ability to pay the $2,000 attorney fee award. We therefore conclude that the trial court did not abuse its discretion in ordering Adeline to pay $2,000 of Richard’s attorney fees.

Accordingly, the order of the circuit court is affirmed.

Affirmed.

FREEMAN, RJ., and CERDA, J., concur.


text:
    CAROL JEAN MELZER, Indiv. and in a Representative Capacity on Behalf of all Persons Similarly Situated, Plaintiff, v. BAUSCH & LOMB, INC., et al., Defendants (Bausch & Lomb, Inc., Counterplaintiff-Appellant; Uhlemann Optical Company of Illinois, Counterdefendant-Appellee).
    First District (3rd Division)
    No. 1—88—2315
    Opinion Filed December 29,1989.

      Seyfarth, Shaw, Fairweather & Geraldson, and Sacks, Montgomery, Pastore & Levine, P.C., both of Chicago (Raymond J. Kelly, Robert B. Ulrich, Harry P. Sacks, Steven J. Brill, Jeffrey S. Parker, and James M. Dennis, of counsel), for appellant.
    Levy, Leopold & Associates, P.C., Plotkin & Jacobs, Ltd., and Brinton, Bollinger & Ruberry, all of Chicago (S. Jerome Levy, Kathy L. Davis, John G. Jacobs, Mark F. Wolfe, and Jerome A. Vinkler, of counsel), for appellee.
   JUSTICE RIZZI

delivered the opinion of the court:

Counterplaintiff-appellant, Bausch and Lomb, Inc. (Bausch & Lomb), appeals from an order of the circuit court which found that the settlement agreement entered into between plaintiff, Carol Melzer (Melzer), and counterdefendant-appellee, Uhlemann Optical Company (Uhlemann), was made in good faith within the meaning of section 2(c) of the Contribution Act (Ill. Rev. Stat. 1987, ch. 70, par. 302(c)). We affirm.

On August 3, 1984, Melzer purchased extended-wear contact lenses from Uhlemann. The extended-wear lenses were designed and manufactured by Bausch & Lomb and prescribed by Dr. Aron Katz to be worn continuously for up to 30 days without removal. Following use of the lenses, Melzer developed a corneal ulcer in her right eye.

In August 1985, Melzer filed a complaint against Bausch & Lomb, Uhlemann and Dr. Katz seeking damages for injuries sustained as a result of wearing the extended-wear contact lenses. In December 1985, Melzer amended her complaint to add a class action count against Bausch & Lomb. In June 1986, Bausch & Lomb filed a counterclaim for contribution and indemnity against Uhlemann. Bausch & Lomb moved to dismiss the class action count of the complaint, and its motion was granted. Melzer thereafter filed a second-amended complaint, and Bausch & Lomb again moved to dismiss the class action count. Uhlemann also filed a motion to dismiss the complaint for failure to state a cause of action against it.

Prior to the hearing on Uhlemann’s motion to dismiss, Melzer and Uhlemann entered into a settlement agreement. In exchange for a cash payment of $13,500, Melzer agreed to release Uhlemann from all liability for injuries sustained as a result of wearing the extended-wear contact lenses. On March 30, 1988, Uhlemann filed a motion for a finding of good-faith settlement pursuant to section 2(c) of the Contribution Act. Bausch & Lomb objected, and a hearing was conducted.

Bausch & Lomb filed a memorandum, and following oral argument, the trial court found that the parties’ settlement agreement was made in good faith. This appeal followed.

On appeal, Bausch & Lomb argues that the trial court erred in finding that the settlement agreement between Melzer and Uhlemann was made in good faith and in failing to hold an evidentiary hearing on the issue. We disagree.

Section 2 of the Contribution Act provides in relevant part:

“(c) When a release or covenant not to sue or not to enforce judgment is given in good faith to one or more persons liable in tort arising out of the same injury or the same wrongful death, it does not discharge any of the other tortfeasors from liability for the injury or wrongful death unless its terms so provide but it reduces the recovery on any claim against the others to the extent of any amount stated in the release or the covenant, or in the amount of the consideration actually paid for it, whichever is greater.
(d) The tortfeasor who settles with a claimant pursuant to paragraph (c) is discharged from all liability for any contribution to any other tortfeasor.” Ill. Rev. Stat. 1987, ch. 70, par. 302.

In determining whether an agreement was made in good faith within the meaning of section 2(c) of the Contribution Act, all of the surrounding circumstances must be considered. (Wilson v. The Hoffman Group, Inc. (1989), 131 Ill. 2d 308, 318.) The compromise of a disputed claim can provide the requisite consideration for a settlement agreement, and the compromise of a potential claim is also sufficient consideration. Wilson, 131 Ill. 2d at 321; O’Connor v. Pinto Trucking Service, Inc. (1986), 149 Ill. App. 3d 911, 917, 501 N.E.2d 263, 267.

Once a preliminary showing of good-faith settlement has been made, the burden shifts to the party challenging the settlement to establish that it was not made in good faith. (Wilson, 131 Ill. 2d at 318-19.) A settlement will not be overturned absent clear and convincing evidence of fraud or mutual mistake. (Christmas v. Hughes (1989), 187 Ill. App. 3d 453, 456, 543 N.E.2d 274, 276.) The trial court is in the best position to decide what type of hearing is necessary to fully adjudicate the issue of good faith. (Barreto v. City of Waukegan (1985), 133 Ill. App. 3d 119, 128, 478 N.E.2d 581, 588.) The issue of good faith may be determined by the court based on arguments of counsel, or on the basis of affidavits, depositions, and other discovery materials of record. Barreto, 133 Ill. App. 3d at 128.

In the present case, at the hearing on the motion for a finding of good-faith settlement, the court heard extensive arguments from the attorneys for Bausch & Lomb, Uhlemann and Melzer. Uhlemann’s attorney informed the court that they made an economic decision to settle the case. He stated that the case had been pending since 1985, and that after several months of negotiation, the parties had reached an agreed settlement figure. Bausch & Lomb’s counsel argued that the evidence that the agreement was made in bad faith included the following: (1) Melzer amended her complaint to add a class action count against Bausch & Lomb, while failing to pursue either Dr. Katz or Uhlemann; (2) the settlement prejudiced Bausch & Lomb’s contribution action; and (3) Melzer did not offer to settle with Bausch & Lomb. Melzer’s attorney informed the court that his client was satisfied with the settlement. In addition, the agreement itself which was presented to the court along with the motion for the good-faith finding indicated that the agreement compromised a valid claim and was entered into voluntarily.

Under these circumstances, the trial court properly found that the settlement agreement was made in good faith. The agreement compromised a potentially viable claim, since even if the complaint did not state a cause of action against Uhlemann on its face, it could be amended to state a valid claim. Further, Bausch & Lomb failed to show by clear and convincing evidence the existence of either fraud or mutual mistake in the procurement of the agreement. Bausch & Lomb merely alleged that it could be inferred from the surrounding circumstances that the agreement was not made in good faith. Mere inferences alone, even if accepted as true, do not rise to the level of clear and convincing evidence required to overturn a settlement agreement where there has been a preliminary showing of good faith. We therefore conclude that the trial court did not err in finding that the parties’ settlement agreement was made in good faith.

Further, because the court considered the parties’ pleadings, motions and Bausch & Lomb’s memorandum in opposition to the good-faith finding, as well as extensive oral arguments before rendering a decision, we find the trial court’s denial of Bausch & Lomb’s request for an evidentiary hearing to have been a proper exercise of its discretion.

Accordingly, for all of the foregoing reasons, we affirm the judgment of the circuit court.

Affirmed.

FREEMAN, P.J., and CERDA, J., concur.


text:
    WAYNE WILHELMSEN, Plaintiff-Appellant, v. CENTURY 21 BEE LINE REALTY, INC., et al., Defendants-Appellees.
    First District (3rd Division)
    No. 1—88—2917
    Opinion filed December 29,1989.
    Mark Patrick Morgan and Keri-Lyn J. Krafthefer, both of Midlothian, for appellant.
    James L. Ebersohl, of Worth, for appellees.
   JUSTICE RIZZI

delivered the opinion of the court:

Plaintiff-appellant, Wayne Wilhelmsen (Wilhelmsen), appeals the trial court’s denial of his petition to vacate an involuntary dismissal. Wilhelmsen argues that the trial court abused its discretion in imposing that sanction based upon the nonappearance of his attorney after he had terminated the attorney-client relationship, and in imposing the most severe sanction when he had no notice that a deposition was scheduled and had acted in good faith and in reliance upon his former counsel. We reverse and remand.

In 1984, Wilhelmsen filed the underlying action against Century 21 Bee Line Realty, Inc., and James J. Hyland, Jr,, for an accounting, injunctive relief, and other equitable relief. At that time and most times relevant, Wilhelmsen was represented by his first attorney of record.

Wilhelmsen failed to appear at a deposition scheduled for November 13, 1987. The notice of deposition was sent to Wilhelmsen’s attorney, who did not notify Wilhelmsen that his presence was necessary. After Wilhelmsen and the attorney did not appear for the deposition, defendant, Century 21 Bee Line Realty, Inc., filed a motion for sanctions.

The notice of motion for sanctions was sent to Wilhelmsen’s attorney. On January 14, 1988, Wilhelmsen sent a certified letter to the attorney discharging him. The attorney received this letter on January 19, 1988, but did not tell Wilhelmsen of the January 26, 1988, hearing on the motion for sanctions. On January 26, 1988, given the attorney’s and Wilhelmsen’s absence, the court ordered “That Plaintiff’s attorney appear before this court on February 10, 1988, at 10:00 a.m., to show cause why this case should not be dismissed.”

The attorney received a copy of this order but did not notify Wilhelmsen that his presence was necessary on February 10, 1988. Prior to February 10, 1988, the attorney forwarded to counsel for one of the defendants a notice of withdrawal. However, the attorney had not filed a motion to withdraw, been granted leave of court to withdraw, given notice to all parties of record, and did not give notice by personal service or certified mail to Wilhelmsen.

On February 10, 1988, neither the attorney nor Wilhelmsen appeared and the court imposed as the sanction dismissal of the lawsuit. The attorney informed Wilhelmsen of the dismissal in a letter dated February 16, 1988, erroneously stating that the case was dismissed for want of prosecution and that he had 30 days from February 16, 1988, to hire a new attorney.

On March 10, 1988, within 30 days from the judgment date, a second attorney filed an appearance, motion to vacate the dismissal for want of prosecution and supporting affidavit. The court denied the motion on April 7, 1988, stating that the motion could be presented after the first attorney had properly withdrawn. A substitution of attorneys was filed on May 11, 1988. Another motion to vacate and supporting affidavit were filed on June 1, 1988, and presented July 26, 1988. The court denied the motion stating that the dismissal was for “failure to participate in practices, rules and process of the Court.” The court further held that the motion was not timely, but noted that the original, timely filed motion was not filed by the first attorney, the then attorney of record. The involuntary dismissal operated as an adjudication of the merits.

Wilhelmsen argues that the imposition of the sanction of dismissal was an abuse of discretion because (1) it was the most severe sanction and (2) it imputed the attorney’s nonactions to him after he had terminated the attorney-client relationship.

The standard of review of decisions imposing sanctions for noncompliance with discovery is whether the trial court abused its discretion. (Ralston v. Casanova (1984), 129 Ill. App. 3d 1050, 1056, 473 N.E.2d 444, 449.) The trial court’s discretionary authority to impose sanctions for discovery violations must be exercised with great care and with the goal of full discovery and full trial on the merits. (Tinsey v. Chicago Transit Authority (1986), 140 Ill. App. 3d 546, 549, 488 N.E.2d 1301, 1303.) In determining whether a discovery sanction is just, a reviewing court must look to the conduct that gave rise to the sanction. (Ralston, 129 Ill. App. 3d at 1057.) Given the circumstances of the case at bar, we find an abuse of discretion.

A dismissal is one of the most severe sanctions that can be imposed for a failure to comply with discovery. Dismissal is appropriate only where there is a showing of wilfull and deliberate disregard of court authority. (Brandt v. John S. Tilley Ladders Co. (1986), 145 Ill. App. 3d 304, 306, 495 N.E.2d 1269, 1271.) Moreover, discovery sanctions have been reversed where the litigants presented a legitimate excuse for their failure to comply and have shown a willingness to comply in the future. (People’s Gas, Light & Coke Co. v. Chicago Black Improvement Association (1986), 148 Ill. App. 3d 1093, 1096, 502 N.E.2d 8, 10.) Here, Wilhelmsen did not deliberately or wilfully disregard court authority. Rather, he was unaware of the deposition and court dates.

An attorney’s conduct in failing to comply with discovery requests may be imputed to the client. (Sanchez v. Phillips (1977), 46 Ill. App. 3d 430, 435, 361 N.E.2d 36, 41.) However, we decline to penalize Wilhelmsen for the nonaction of his former counsel and recognize that his new counsel filed a timely motion to vacate the dismissal.

Accordingly, we reverse the judgment dismissing the case and remand to the circuit court for further proceedings.

Reversed and remanded.

WHITE and CERDA, JJ., concur.


author: JUSTICE JOHNSON

text:
    ELSIE RIZZO, Ex’r of the Estate of Fred Rizzo, Deceased, Plaintiff-Appellant, v. TRAVELERS INSURANCE COMPANY et al., Defendants-Appellees.
    First District (4th Division)
    Nos. 1—88—0471,1—88—1255 cons.
    Opinion filed December 29,1989.

      Hinshaw, Culbertson, Moelmann, Hoban & Fuller, of Chicago (James E. McFarland, Tom H. Luetkemeyer, and Steven Mihajlovic, of counsel), for appellant.
    William G. Beatty and Leah R. Cooper, both of Johnson, Cusack & Bell, of Chicago (Thomas H. Fegan, of counsel), for appellee Travelers Insurance Company.

      Rock, Fusco, Reynolds & Heneghan, of Chicago, for appellee Local No. 1 Hotel Employees and Restaurant Employees.
   JUSTICE JOHNSON

delivered the opinion of the court:

Plaintiff, Elsie Rizzo, the widow and beneficiary of Fred Rizzo, brings this appeal after a grant of summary judgment in favor of defendants, Travelers Insurance Company (Travelers) and Local No. 1 Hotel Employees and Restaurant Employees (Local No. 1). On appeal, plaintiff contends that the court erred in its construction of a benefit provision of a life insurance policy, thereby serving to deny plaintiff the correct benefit amount under the policy.

On August 1, 1982, a group life insurance policy was purchased by Local No. 1 from Travelers to provide insurance for Local No. 1 employees and union members. When the policy was issued, decedent was employed by Local No. 1 and held the position of “Business Agent” with the union.

The policy’s “Schedule of Benefits” provided, in pertinent part, as follows:

“LIFE INSURANCE-FOR YOU ONLY
Occupation or Position Amount of Life Insurance
Prior to Age 65
I. Actively Employed Officer $40,000
II. Business Agent $10,000
III. All other occupations & positions $6,000
Changes in amounts of insurance due to change in your occupation or position will become effective on the Policy Anniversary following the date your occupation or position is changed. Such new amounts of insurance will be determined in accordance with the table above upon the basis of your occupation or position as of the first day of the third insurance month next preceding such Policy Anniversary.”

All sums are doubled in the event of an accidental death.

June 1, 1983, and the same date each year thereafter was designated as the policy anniversary date. March 1 of each year was designated as the date on which Travelers determined the amount of insurance each employee and union member would be entitled to for the upcoming policy year.

On April 23, 1984, decedent was elected secretary of the union, thereby changing his position to “Actively Employed Officer”; however, Local No. 1 failed to record the change. On December 21, 1984, decedent accidentally died of a gunshot wound to the neck.

Plaintiff, as the named beneficiary to decedent’s life insurance policy, made a claim for benefits. Travelers tendered $20,000 to plaintiff, which was calculated as double the $10,000 benefit due when a “Business Agent” dies accidentally. Plaintiff maintains that she is entitled to $80,000, which is double the $40,000 benefit allowed for beneficiaries of an “Actively Employed Officer” who dies accidentally.

Plaintiff, as the executor of decedent’s estate, brought suit against Travelers and Local No. 1. The complaint consisted of four counts. Count I prayed for declaratory relief against both defendants. Counts II and III alleged breach of contract by Travelers and Local No. 1, respectively. Count IV alleged negligence against Local No. 1. Plaintiff did not assert any of the causes of action available to her under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §1001, et seq. (1982) (hereinafter ERISA). Travelers’ filed a motion for summary judgment which was adopted by Local No. 1. Defendants’ motion argued that any change in an insured’s occupation or position must occur more than three months before the policy anniversary date, i.e., before March 1, before any new amount of life insurance coverage would become effective. If an insured’s occupation or position changed after March 1, any new amount of life insurance coverage would not become effective, until the following year. Defendants argued that since decedent’s change in occupation or position occurred after March 1, 1984, he would remain insured as a “Business Agent” until June 1, 1985, i.e., the next policy anniversary date. Had decedent lived, the increased coverage provided for an “Actively Employed Officer” would have become effective on June 1, 1985. Defendants believe that the first sentence grants benefits and defines when the benefits will become effective; the second sentence describes calculation of the benefits and when a new benefit amount will be determined.

In response to defendants’ motion for summary judgment, plaintiff argued that the schedule of benefits provision of the insurance policy was ambiguous when properly interpreted. Plaintiff interpreted the first sentence of the benefits provision to mean that “changes in the amounts of insurance, due to change in occupation or position, [became] effective on the policy anniversary following the date the occupation or position is changed.” Plaintiff believed that the second sentence of the benefits provision “raise[d] an ambiguity to the otherwise clear intent of the first sentence.”

After hearing defendants’ motion, the court entered judgment for defendants and denied plaintiff’s cross-motion for summary judgment. On appeal, plaintiff raises the following issues: (1) the trial court erred by ordering enforcement of an insurance contract which contains ambiguous and inconsistent provisions; (2) the insurance contract must be interpreted in a manner which expresses the intent of the policy and reconciles two ambiguous and inconsistent provisions; and (3) ambiguities should be construed against the insurer that drafted the policy. Plaintiff’s arguments assume that the insurance policy is ambiguous and in need of construction. Travelers argues that (1) plaintiff’s complaint, which is based on State common law, is preempted by ERISA and should be dismissed for want of subject mater jurisdiction; (2) preemption by ERISA is a challenge to the court’s subject matter jurisdiction and cannot be waived; (3) defendant would be entitled to summary judgment under an ERISA action in Federal court; and (4) if the court finds that plaintiff’s cause of action is not preempted, the trial court correctly ruled that the insurance policy was not ambiguous. Plaintiff responds to defendant’s arguments by asserting that (1) the mere allegation that an insurance policy is part of an “employee welfare benefit plan” is insufficient to preempt a State cause of action; (2) defendant Travelers failed to establish that it is a fiduciary under ERISA; (3) defendants’ reliance on Pilot Life Insurance Co. v. Dedeaux (1987), 481 U.S. 41, 95 L. Ed. 2d 39, 107 S. Ct. 1549, is premature; and (4) this case must be decided under the applicable rules of construction for insurance contracts in Illinois.

Initially we must determine whether the group life insurance policy issued to employees of Local No. 1 is an employee welfare benefit plan governed by ERISA and, if so, do the State courts have subject matter jurisdiction over plaintiff’s claim.

Under ERISA, an “employee welfare benefit plan” is broadly defined to include the following:

“[A]ny plan, fund, or program which was *** established or maintained by an employer *** to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment ***.” 29 U.S.C. §1002(1) (1982).

In determining whether a “plan, fund, or program” under ERISA is established, a court must decide based on the surrounding circumstances whether “a reasonable person could ascertain the intended benefits, beneficiaries, source of financing, and procedures for receiving benefits. Some essentials of a plan, fund, or program can be adopted, explicitly or implicitly, from sources outside the plan, fund, or program ***. *** [T]he purchase of a group policy *** covering a class of employees offers substantial evidence that a plan, fund, or program has been established.” (Donovan v. Dillingham, (11th Cir. 1982), 688 F.2d 1367, 1373.) It is well settled that decisions of the United States district courts and the circuit courts are not binding on Illinois courts. (City of Chicago v. Groffman (1977), 68 Ill. 2d 112, 118.) However, such decisions may be adopted to the extent that we find the reasoning and rationale persuasive. Skokie Gold Standard Liquors, Inc. v. Seagrams & Sons, Inc. (1983), 116 Ill. App. 3d 1043, 1057.

The record indicates that Local No. 1 purchased a group life insurance policy from Travelers for the benefit of its employees in the event of death. Under the policy, an insured employee named the beneficiary of the death benefit. The “Schedule of Benefits” expressly states the intended benefits. Although the record does not explicitly indicate the procedures for receiving benefits, it does indicate that the insured employee is to place the name of his beneficiary on file with his employer. The record states that the employee may change his beneficiary by obtaining the required forms from his employer and returning the completed forms to his employer. We believe these circumstances are sufficient to establish the essentials of a “plan, fund, or program” established or maintained by an employer for the purpose of providing death benefits to participants’ beneficiaries.

Next we consider whether plaintiff’s causes of action for breach of contract and negligence are preempted under ERISA. Plaintiff asserts that the trial court erred in construing the policy. She argues that the correct interpretation of the policy expresses the intent of the policy and reconciles inconsistent sentences and that ambiguities in the policy should be construed in favor of plaintiff since defendant drafted the policy. Section 1144(a) specifically provides:

“Except as provided in subsection (b) [not applicable here] of this section, the provisions of this subchapter and subchapter III of this chapter shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title and not exempt under section 1003(b) of this title.” 29 U.S.C. § 1144(a) (1982).

This statute was interpreted by the Supreme Court in Pilot Life Insurance Co. v. Dedeaux (1987), 481 U.S. 41, 95 L. Ed. 2d 39, 107 S. Ct. 1549. The Court reasoned that a State law “relating] to *** employee benefit plan[s]” is preempted under section 1144(a). (Dedeaux, 481 U.S. at 45, 95 L. Ed. 2d at 46, 107 S. Ct. at 1552.) The court noted the “expansive sweep of the pre-emption clause.” (Dedeaux, 481 U.S. at 47, 95 L. Ed. 2d at 48, 107 S. Ct. at 1553.) “The phrase ‘relate to’ was given its broad common-sense meaning, such that a state law ‘relatejs] to’ a benefit plan ‘in the normal sense of the phrase, if it has a connection with or reference to such a plan.’ ” (Metropolitan Life Insurance Co. v. Massachusetts (1985), 471 U.S. 724, 739, 85 L. Ed. 2d 728, 740, 105 S. Ct. 2380, 2389, citing Shaw v. Delta Air Lines, Inc. (1983), 463 U.S. 85, 97, 77 L. Ed. 2d 490, 501, 103 S. Ct. 2890, 2900.) Our court of appeals has found that the ERISA provisions serve to preempt all State-law-based causes of action and to supersede State decisional law which relates to an employee benefit plan. Arnold v. Babcock & Wilcox Co. (1987), 154 Ill. App. 3d 863, 870.

The State contract and tort law, relied upon by plaintiff, have a connection with or reference to the life insurance policy purchased by Local No. 1; therefore, the State laws are preempted. In this case the State laws do not regulate insurance and, therefore, are not saved from preemption. All of plaintiff’s arguments are based upon State law causes of action and, thus, are preempted. Accordingly, no further discussion concerning the State law claims raised by the parties is necessary.

Next we determine whether the State court lacks subject matter jurisdiction over plaintiff’s State claims since plaintiff seeks to recover benefits from an insurance policy which is covered by ERISA. It is well settled that the defense of lack of subject matter jurisdiction cannot be waived. (Ruff v. Industrial Comm’n (1986), 149 Ill. App. 3d 73, 78.) Accordingly, defendant’s arguments based on lack of subject matter jurisdiction, initially raised on appeal, were not waived. The type of benefit allegedly owed to plaintiff is covered by ERISA, which preempts State claims; therefore, the trial court lacks subject matter jurisdiction over State claims in such a case. ERISA’s preemption of State claims mandates dismissal of all such claims. (Hagler v. J.F. Jelenko & Co. (Mo. App. 1986), 719 S.W.2d 486, 487.) In this situation plaintiff’s claims are based on State law theories. Plaintiff fails to make any claims under ERISA. Since Illinois courts lack subject matter jurisdiction over plaintiff’s common law contract and tort claims, they will be dismissed.

It should be noted that, since the life insurance policy is covered under ERISA, this case arises under Federal law and the Illinois courts have concurrent jurisdiction on any ERISA claims raised by. the plaintiff. Section 1132(e)(1) of ERISA (29 U.S.C. § 1132(e)(1) (1982)) provides:

“State courts of competent jurisdiction and district courts of the United States shall have concurrent jurisdiction of actions under subsection (a)(1)(B) of this section.”

Subsection (a)(1)(B) provides, in pertinent part:

“(a) ***
A civil action may be brought—
(1) by a participant or beneficiary—
* * *
(B) to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan[.]” 29 U.S.C. § 1132(a)(1)(B) (1982).

Although the trial court lacked subject matter jurisdiction over plaintiff’s State law claims, we will consider plaintiff’s declaratory action, since Federal law would determine the benefit amount to be paid to plaintiff. The applicable standard for interpretation of ERISA plans differs from the ordinary contract cases which are governed by State law. (Arnold, v. Babcock & Wilcox Co. (1987), 154 Ill. App. 3d 863, 871.) Under Federal law, a court which is asked to review the defendant’s interpretation of an insurance policy is limited to determining whether the interpretation was made rationally and in good faith, not whether the interpretation of the policy was right. We must read the policy as a whole to determine whether defendant’s interpretation of the policy was arbitrary. Arnold, 154 Ill. App. 3d at 871.

The life insurance policy, by its express terms, provides a method for calculating the benefit amount to be paid to an employee’s beneficiary. To displace a valid and rational method of determining benefits with a method based on State contract and tort principles would violate the terms of the policy. ERISA preempts, with limited exceptions, any attempts to displace the express terms of an employee benefit plan with terms fashioned under State law.

Defendants’ reading of the “Schedule of Benefits” provision is clear and unambiguous. The first sentence explains that a change in position or occupation results in a change in insurance benefits. The second sentence describes when the changed benefits will vest and how the amount of time necessary for vesting the benefits will be calculated. Based on the defendants’ logic, the plain language of the policy indicates that the policy required a change in position to occur three months before the policy anniversary date, i.e., before March 1, in order for any change in benefit amount to become effective that year. If the change in position occurred after March 1, the change in benefit amount would become effective the following year. Based on this interpretation of the provision, Travelers tendered $20,000 to plaintiff. The amount was calculated based on the $10,000 agent benefit, which was doubled due to decedent’s accidental death. We believe defendants’ interpretation is rational. Furthermore, the record fails to indicate that the interpretation was made in bad faith, and, therefore, we are bound to accept it.

Based on the foregoing, there is no need to discuss the remaining issues raised by the parties.

We conclude that ERISA preempts State contract and tort claims in this case, and we hold that calculation of the benefit amount owed to plaintiff was correctly determined. Accordingly, we affirm the judgment of the circuit court.

Affirmed.

JIGANTI, P.J., and LINN, J., concur.


author: JUSTICE HARTMAN JUSTICE DiVITO,

text:
      In re JAMES J. et al., Minors (James J. et al., Minors, by their Guardian ad litem, Respondents-Appellants, v. The People of the State of Illinois, Petitioner-Appellee (Karen J. Taylor et al., Respondents-Appellees)).
    First District (2nd Division)
    Nos. 1—88—3231,1—88—3232, 1—88—3239 cons.
    Opinion filed December 29,1989.

      DiVITO, J., dissenting.
    Patrick T. Murphy, Public Guardian, of Chicago (Julie Biehl and Susan Pierce, of counsel), for appellants.
    Cecil A. Partee, State’s Attorney, of Chicago (Renee Goldfarb, Deputy Supervisor, and Tracy Genesen, Assistant State’s Attorney, of counsel), for the People.
    Randolph N. Stone, Public Defender, of Chicago (Aaron Meyers, Assistant Public Defender, of counsel), for appellees Karen J. Taylor and James Taylor.
   JUSTICE HARTMAN

delivered the opinion of the court:

Upon motion of the State’s Attorney, petitions for adjudication of wardship filed on behalf of three minors were dismissed. The public guardian, as the minors’ attorney and guardian ad litem, appeals that dismissal. The issues presented for review are whether (1) this appeal should be dismissed due to the public guardian’s failure to proceed under Illinois Supreme Court Rule 306(a)(l)(v) (107 Ill. 2d R. 306(a)(l)(v)); and (2) the circuit court erred in dismissing the petitions to adjudicate wardship on the ground that it did not have the authority to require the State to prosecute the petitions.

On September 9, 1988, the Illinois Department of Children and Family Services (DCFS) registered three petitions for adjudication of wardship for James J., Shawn J., and Jasmine J. in the circuit court. Each petition was based on section 2 — 3(2)(a)(ii) of the Juvenile Court Act of 1987 (Ill. Rev. Stat. 1987, ch. 37, par. 802 — 3(2)(a)(ii)) (Act).

At the initial hearing on September 28, 1988, in the circuit court, the office of the public guardian was appointed as attorney and guardian ad litem for the three minors. The public defender also was then appointed as attorney for the parents of the minors. The prosecutor, an assistant Cook County State’s Attorney, subsequently moved to dismiss the petitions, based upon his previous discussion of the case with the DCFS and Department of Child Protection personnel. According to the State’s Attorney, the conclusion reached by him and the case workers was that “this was apparently a one time incident in which the injury to one of the children was accidentally \sic\ as a result of a family dispute” and unlikely to recur. The public guardian, however, objected to the motion to dismiss, suggested it was in the best interest of the minors to proceed on the petition, and urged that the court had the authority to order the State’s Attorney to prosecute the petitions for adjudication of wardship.

Pursuant to the State’s motion, the court dismissed the petitions without prejudice, reasoning that such a ruling was required under both the “separation of powers provision of the Constitution” and the Juvenile Court Act of 1987, which gave the State’s Attorney exclusive authority to prosecute these cases. The court concluded that while it was permitted to direct the State’s Attorney to file a petition, it was “without legal authority or precedent to require the State to proceed with the prosecution of this case.”

From the dismissal without prejudice of the three petitions to adjudicate wardship, the minors, through the public guardian, appeal.

I

The public defender argues that this appeal should be dismissed, relying on Illinois Supreme Court Rule 306(a)(l)(v) (107 Ill. 2d R. 306(a)(l)(v)). Characterizing the dismissal without prejudice entered here as a nonfinal interlocutory order affecting the care and custody of minors, the public defender urges that the appeal be dismissed because the guardian failed to comply “•with the rules governing such appeals.”

The order dismissing the petition without prejudice was entered as a matter of law because the circuit court believed that it lacked authority to require the State to proceed with the actions. The dismissal of the petition, in effect ordered as a matter of law, was final as to the minors. Any other conclusion would preclude the minors from ever challenging that ruling by the court. The cause has been properly appealed pursuant to Rule 301 (107 Ill. 2d R. 301), made applicable to this case by Rule 660(b) (107 Ill. 2d R. 660(b)).

II

The public guardian contends the circuit court erred in asserting it had no power under the constitutional principle of separation of powers to order the State to prosecute the petition, relying on People ex rel. Davis v. Vazquez (1982), 92 Ill. 2d 132, 441 N.E.2d 54 (Vazquez), and section 2 — 13(1) of the Act (Ill. Rev. Stat. 1987, ch. 37, par. 802 — 13(1)). That section provides, in part:

“Any adult person, any agency or association by its representative may file, or the court on its own motion may direct the filing through the State’s Attorney of a petition in respect of a minor under this Act.” (Emphasis added.) (Ill. Rev. Stat. 1987, ch. 37, par. 802-13(1).)

The public guardian concludes that the court erred in dismissing the petition without a hearing on the underlying facts in mistaken reliance upon an “exclusive” discretion to prosecute on the part of the State’s Attorney.

At issue in Vazquez was whether a court’s order directing the State’s Attorney to file a petition under the predecessor to section 2— 13(1) (Ill. Rev. Stat. 1979, ch. 37, par. 704 — 1(1)) was void. The State challenged that section as an unconstitutional attempt to vest a court with power belonging exclusively to the executive branch, in violation of the principle of separation of powers. (Vazquez, 92 Ill. 2d at 149-50.) The supreme court noted that the aim of the statute is to “provide a number of avenues of access to the juvenile court for minors in need of its services,” and held that the authorization in then-section 4 — 1(1), permitting the juvenile court to direct the State to file a petition on behalf of a minor, was not an impermissible exercise of executive powers by the judicial branch. (Vazquez, 92 Ill. 2d at 150-51.) In reaching its conclusion, the Vazquez court acknowledged a distinction between the decision of whether to initiate criminal prosecution or of what offense to charge from proceeding under the Act. The State’s Attorney’s office, as part of the executive branch of government, has exclusive discretion in the initiation and management of criminal prosecutions. (People ex rel. Daley v. Moran (1983), 94 Ill. 2d 41, 45, 445 N.E.2d 270.) The Vazquez court made the following observations pertinent to the issues here (Vazquez, 92 Ill. 2d at 150-51):

“The filing of a petition in respect of a minor under the Juvenile Court Act is not a matter within the exclusive executive discretion of the State’s Attorney. Any responsible adult having knowledge of the circumstances may file a petition under section 4 — 1 alleging a minor to be delinquent, dependent, neglected, or a minor in need of supervision. In addition, the Act authorizes probation officers to investigate and evaluate an allegation that a minor is delinquent, and to see to the filing of a petition where this is indicated. (Ill. Rev. Stat. 1979, ch. 37, par. 706 — l(2)(a).) The aim of section 4 — 1 is to provide a number of avenues of access to the juvenile court for minors in need of its services. The petition is simply the means by which the juvenile court acquires official cognizance of the situation of the minor. (People v. Piccolo (1916), 275 Ill. 453, 455.) A person filing a petition is merely ‘an agent of the court in bringing the facts of the case to the attention of the court.’ In re Brown (1904), 117 Ill. App. 332, 336.
The decision to file a petition, therefore, is not like the decision whether to initiate a criminal prosecution or what offense to charge, which are functions within the exclusive discretion of the State’s Attorney; and the cases to this effect, cited by the State, are inapposite. (People ex rel. Carey v. Cousins (1979), 77 Ill. 2d 531; People v. Ruiz (1979), 78 Ill. App. 3d 326; People v. Rotramel (1972), 5 Ill. App. 3d 196.) A petition under section 4 — 1 need not specify any proposed disposition of the minor; moreover, specific information is made for two or more petitions being filed in respect to the same minor at the same time. (Ill. Rev. Stat. 1979, ch. 37, pars. 704-1(3), 704-1(6).) We hold that section 4 — l’s authorization of the juvenile court to direct the filing of a petition in respect of a minor through the State’s Attorney does not authorize an impermissible exercise by the judicial branch of powers belonging exclusively to the executive, and does not violate article II, section 1, of the Illinois Constitution.”

In the instant case, the State’s Attorney was amenable to filing the petitions, unlike Vazquez. The issue raised by the parties here is whether the State’s Attorney can be ordered to proceed when he has decided to dismiss the petition. We need not go so far, however, since we find that the court erred in refusing to first consider the motion on its merits on the supposition that it had no authority to do so. We hold that the circuit court is required to consider on its merits a motion to dismiss a petition for adjudication of wardship, whenever dismissal is deemed warranted by the State alone, because failure to do so overlooks the purposes behind the Act. The court’s primary function is to make certain that the best interests of a minor, his family, and society are addressed. (Ill. Rev. Stat. 1987, ch. 37, par. 801-2; In re C.T. (1983), 120 Ill. App. 3d 922, 925, 458 N.E.2d 1089.) When presented with a motion to dismiss by the State, those interests hardly can be served when, as here, the court grants the motion without inquiring as to the factual or legal bases for the motion. To hold that section 2 — 13(1) authorizes the court to direct the filing of a petition through the State’s Attorney, but has no role in determining the bases, or want thereof, for dismissing the petition makes access of a minor to the court system a mockery. The entire arsenal of statutorily authorized protections in furtherance of the minor’s best interests becomes meaningless if, pro forma, the circuit court is reduced to the role of a rubber stamp when, for whatever reason, sufficient or not, arbitrary or not, capricious or not, the minor’s access to the justice system revolves in and out of the courthouse doors without meaningful judicial review.

Precluding a court from considering on its merits a motion to dismiss a petition for adjudication of wardship removes an important procedural safeguard in assuring that those interests were served. The court here had an obligation to consider the merits of the motion to dismiss and evaluate whether dismissal was in the best interests of the minors, their family, and society, and should not have deferred automatically to the conclusion of the State’s Attorney. Proceedings under the Act, being distinct from criminal prosecutions (Vazquez, 92 Ill. 2d at 150), require the circuit court to ensure that a dismissal of a petition to adjudicate wardship is in the best interests of the minors, their family, and society. This inquiry does not infringe on the executive authority of the State’s Attorney’s office to initiate and prosecute criminal matters. Nor is it intended to alter the State’s Attorney’s role as prosecutor. The inquiry, hearing the motion on its merits, simply enables a court to examine the State’s Attorney’s position and evaluate the State’s position against the interests of the child involved. Only in this way can the court fulfill its role as parens patriae and satisfy its duty to enable a minor to receive the care and guidance which the Act provides. See In re T.D. (1980), 81 Ill. App. 3d 369, 372, 401 N.E.2d 275.

The court’s declination to consider the merits of the motions to dismiss in this case was error and requires that we reverse and remand for proceedings consistent with this opinion. Whether a court has the inherent power or statutory authority to direct the State to prosecute by denying such a motion is a matter which must await an appropriate case. Cf Sullivan v. Sullivan (1982), 110 Ill. App. 3d 714, 442 N.E.2d 1348.

The contention by the public defender and the State that the circuit court’s dismissal of the petitions was based upon the prosecutor’s determination that the occurrence was isolated and unlikely to reoccur must be rejected. The record here indicates that the court never considered the facts underlying the motion to dismiss nor their merits. The court’s decision was based upon its belief that it had no constitutional authority to deny the motion, and ruled solely on that understanding.

Reversed and remanded for further proceedings.

BILANDIC, P.J., concurs.

JUSTICE DiVITO,

dissenting:

In my judgment, the public guardian’s position in this case represents an unwarranted extension of People ex rel. Davis v. Vazquez (1982), 92 Ill. 2d 132, 441 N.E.2d 54, and an impermissible intrusion by the judiciary into the executive branch of the government. I would affirm the judgment below and hold that the trial court cannot, consistent with the principle of separation of powers, order the State’s Attorney to prosecute a Juvenile Court Act petition.

As noted by the majority, Vazquez holds only that the court can order the State’s Attorney to file a Juvenile Court Act petition without violating the principle of separation of powers. In so holding, the Vazquez court expressly relied on the provisions of the Juvenile Court Act allowing “[a]ny responsible adult” to file a petition, authorizing probation officers to investigate and evaluate delinquency allegations, and generally “providing] a number of avenues of access to the juvenile court for minors in need of its services.” (People ex rel. Davis v. Vazquez, 92 Ill. 2d at 150-51.) Because the filing of a petition is not a matter within the “exclusive executive discretion of the State’s Attorney,” the court reasoned, the State’s Attorney can be ordered to file a petition without violating the principles of separation of powers.

Vazquez, however, is not authority for the public guardian’s position in this case. Unlike the filing of a petition, which, I must concede, is not within the exclusive control of the State’s Attorney, the prosecution of a petition is an exclusively executive function. Section 2 — 13(1) of the Juvenile Court Act provides that, in addition to the State’s Attorney, “[a]ny adult person, any agency or association by its representative may file *** a petition in respect of a minor under [the] Act.” (Ill. Rev. Stat. 1987, ch. 37, par. 802 — 13(1).) Once a petition has been filed, however, no person, agency, or association, other than the State’s Attorney, is vested with authority to prosecute the petition, although the court may in its discretion allow private counsel or a special prosecutor to assist the State’s Attorney. (See In re Hillyer (1980), 82 Ill. App. 3d 505, 403 N.E.2d 36; In re Teague (1966), 77 Ill. App. 2d 55, 221 N.E.2d 790; In re Morris (1947), 331 Ill. App. 417, 73 N.E.2d 337; People v. Hinton (1947), 330 Ill. App. 130, 70 N.E.2d 261.) Indeed, section 1 — 6 of the Act plainly provides that “[t]he State’s Attorneys of the several counties shall represent the people of the State of Illinois in proceedings under this Act[.]” Ill. Rev. Stat. 1987, ch. 37, par. 801 — 6.

Thus, Vazquez is easily distinguished from the present case on the ground that the prosecution of a petition, as opposed to the mere filing of a petition, is the sole responsibility of the State’s Attorney. For the same reason, the public guardian’s reliance on Sullivan v. Sullivan (1982), 110 Ill. App. 3d 714, 442 N.E.2d 1348, is misplaced. That case, in my judgment, was wrongly decided because the court failed to recognize that Vazquez applies only to the filing of a petition, not to functions, like the prosecution of a petition, within the State’s Attorney’s exclusive domain.

Because the prosecution of a Juvenile Court Act petition is a matter within the exclusive executive discretion of the State’s Attorney, I would accept the public defender’s argument in this case, that the trial court was without constitutional authority to deny its motion to dismiss the petition. The contrary position is not only without support in the Act or in the case law, but would lead to awkward results. For example, if the State’s motion to dismiss the petition were denied, the State would be compelled to prosecute a petition which it deemed to be without merit. In Sullivan v. Sullivan (1982), 110 Ill. App. 3d 714, 442 N.E.2d 1348, where the court ordered the State’s Attorney to prosecute a petition for custody change based on parental neglect, the prosecutor, who sought to dismiss the action and refused to participate, became a party to the proceeding in name only. I do not believe, as the majority suggests, that the interests of the child are protected by this type of procedure. On the contrary, I believe that the interests of the child are better served by the refiling of a petition, if warranted, by the State’s Attorney or any other person authorized to file a petition, and subsequent prosecution by a zealous State’s advocate.

Finally, in my view, the majority’s decision not to reach the issue clearly raised on this appeal is unwarranted. The majority concludes only that the State’s motion to dismiss the petition should have been considered on its merits. The majority apparently believes it is necessary for the court to hear the merits of the motion to protect the interests of the child. The same facts, however, which might warrant a denial of the motion could come to the court’s attention by the initiation of another proceeding by any person authorized to file a petition. In my opinion, this procedure would adequately protect the interests of the child without any intrusion by the court on the State’s Attorney’s prosecutorial domain.

In any event, a hearing on the merits would plainly be a fruitless procedure if the trial court is without constitutional authority to deny the motion and compel prosecution of the case. On the other hand, constitutional considerations aside, if the court allows the motion following a hearing on the merits, appeals challenging the trial court’s exercise of discretion would no doubt follow. The majority has offered no guidance with respect to the standard of proof required in the trial court or the standard of review on appeal. Indeed, I do not believe there is any authority for allowing appeals such as this one by the public guardian absent a grant of leave by this court.

For the foregoing reasons, I would affirm the judgment of the circuit court.

      Jasmine J. also is referred to as “Yasmine” in the record.


author: PRESIDING JUSTICE WOMBACHER

text:
    FIRST NATIONAL BANK OF MOLINE, Plaintiff-Appellant, v. CALIFF, HARPER, FOX AND DAILEY, Defendant-Appellee.
    Third District
    No. 3—89—0206
    Opinion filed December 29,1989.

      Law Office of Mike McElvain, of Bloomington (Mike McElvain, of counsel), for appellant.
    Stephen R. Swofford, of Hinshaw, Culbertson, Moelmann, Hoban & Fuller, of Chicago, and David E. Jones, of Thomas & Hinshaw, Culbertson, of Peoria (Bruce L. Carmen, of counsel), for appellee.
   PRESIDING JUSTICE WOMBACHER

delivered the opinion of the court:

Plaintiff First National Bank of Moline brought an action to recover money damages for the negligent preparation of a mortgage by its borrower’s attorney. The trial court dismissed plaintiff’s second amended complaint for failure to state a cause of action. Plaintiff appeals.

The record reveals the following information. In August 1982, Donald and Janet Cantrill, on behalf of their company Cantrill Development Corporation, found it necessary to secure a loan to keep their business afloat. The Cantrills approached the plaintiff, who agreed to lend them the money if the Small Business Administration (SBA) would guarantee the loan.

The Cantrills hired attorney Robert Mensing of the defendant law firm Califf, Harper, Fox & Dailey, P.C., to assist with the procurement and execution of the loan. The SBA agreed to guarantee the loan if the Cantrills would give a second mortgage on their house as security for the loan. The SBA forwarded an authorization and loan agreement to the plaintiff. The plaintiff then forwarded the SBA documents and information to Mensing, asking him to fill out the forms and meet the requirements listed in the authorization loan agreement. Additionally, the cover letter sent by the plaintiff to Mensing indicated that should Mensing need any further assistance with the preparation of the forms, he should contact the plaintiff.

Mensing had the Cantrills sign the mortgage individually, when in actuality their home was in a land trust and they were the beneficial owners of the trust. It is unclear whether the mortgage went back to the plaintiff or was retained by Mensing until it was filed on December 28, 1982.

Subsequently the Cantrills gave a third mortgage on the property. Thereafter the Cantrills filed for bankruptcy, and plaintiff’s mortgage was declared invalid because the land trustee had never pledged its interest. The plaintiff was classified as a general creditor and received no benefit.

The SBA made demand upon the plaintiff for reimbursement because of the plaintiff’s failure to meet one of the loan requirements, that being the second mortgage on the Cantrill’s house. The plaintiff settled with the SBA for $22,500.

The plaintiff brought suit against Mensing’s employer, the defendant professional corporation, for Mensing’s alleged negligence in preparing the mortgage. The trial court granted defendant’s motion to dismiss plaintiff’s second amended complaint, finding that the plaintiff had failed to state a cause of action. Plaintiff appeals.

The sole issue on appeal is whether a borrower’s attorney owes a duty to a lending bank when preparing a Small Business Administration mortgage document necessary to obtain an SBA loan guarantee.

To state a legally sufficient claim for negligence, a plaintiff must allege the existence of a duty owed by the defendant to the plaintiff, a breach of that duty, and an injury proximately caused by that breach. (Curtis v. County of Cook (1983), 98 Ill. 2d 158, 162, 456 N.E.2d 116.) The determination of whether a duty exists is an issue of law to be determined by the court. (Kirk v. Michael Reese Hospital & Medical Center (1987), 117 Ill. 2d 507, 525, 513 N.E.2d 387.) To conclude that a duty exists, a court must find that the defendant and the plaintiff stood in such a relationship to one another that the law imposed upon the defendant an obligation of reasonable conduct for the benefit of the plaintiff. Kirk v. Michael Reese Hospital & Medical Center (1987), 117 Ill. 2d 507, 525, 513 N.E.2d 387.

The general rule of law is that an attorney owes a professional obligation only to his client, not to nonclient third persons. (Byron Chamber of Commerce, Inc. v. Long (1981), 92 Ill. App. 3d 864, 868, 415 N.E.2d 1361.) This concept of privity has long protected attorneys from malpractice claims by nonclients. (Bloomer Amuse ment Co. v. Eskenazi (1979), 75 Ill. App. 3d 117, 394 N.E.2d 16.) However, in Pelham v. Griesheimer (1982), 92 Ill. 2d 13, 440 N.E.2d 96, our supreme court held that, under limited circumstances, a non-client may maintain a negligence action against an attorney.

In Pelham the plaintiffs’ mother retained the defendant-attorney to represent her in a divorce proceeding against her husband. The divorce decree contained a provision requiring the husband to maintain the plaintiffs as the prime beneficiaries in his life insurance policies. After the divorce decree was entered, he remarried and named his second wife the beneficiary of the insurance policy. She received the proceeds of the policy after his death.

The plaintiffs sued the attorney for negligence, alleging that they were direct third-party beneficiaries of the contract between their mother and the attorney. The court denied recovery, holding that the plaintiffs’ mother retained the defendant to obtain a divorce, a property settlement and custody of the children, not to represent her children’s interests as beneficiaries under an insurance policy. As such, the plaintiffs were incidental, rather than intended, beneficiaries of the contract between their mother and the defendant.

The rule in Pelham, then, is “for a nonclient to succeed in a negligence action against an attorney, he must prove that the primary purpose and intent of the attorney-client relationship itself was to benefit or influence the third party.” Pelham v. Griesheimer (1982), 92 Ill. 2d 13, 21, 42 N.E.2d 96. See also McLane v. Russell (1989), 131 Ill. 2d 509.

Plaintiff contends that Mensing’s representation of the Can-trills was of a nonadversarial nature and that Mensing’s preparation of the mortgage securing the loan was intended to benefit both the Cantrills and the plaintiff. As the plaintiff was to benefit from the transaction, plaintiff maintains that it comes within the rule in Pelham and was owed a duty of reasonable care by Mensing.

We cannot agree. Plaintiff ignores the “primary purpose and intent” language of Pelham. In the instant case the Cantrills, experienced business people, went out and hired an attorney for the sole purpose of assisting them in the procurement and execution of a loan necessary to keep their business afloat. The primary and direct purpose of the relationship was for Mensing to help the Cantrills find a loan and for him to oversee the execution of the loan documents. Obviously another party was going to benefit somewhat by making a loan to the Cantrills, i.e., by receiving interest from the loan, but it cannot be said that that this was the primary and direct reason for the Mensing-Cantrill relationship.

Plaintiffs contention that a lender-borrower relationship is non-adversarial in nature is undermined by the history of the Cantrills and the plaintiff. The record indicates that the two parties had done business previously. At one point the plaintiffs called the Cantrills’ loan, thereby threatening the survival of the Cantrills’ business. It is not unreasonable to infer that the Cantrills wanted someone to watch out for their interests in financial dealings with the plaintiff.

Finally, we note that the SBA sent the documents to the plaintiff. The plaintiff then forwarded the documents to Mensing. Nothing prevented the plaintiff from having Mensing return the completed documents to the plaintiff for plaintiff’s own counsel to review. Part of the costs of doing business is legal expense.

For the reasons listed above, the decision of the circuit court of Rock Island County is affirmed.

Affirmed.

BARRY and SCOTT, JJ., concur.