text:
    LINNEA PRITCHARD et al., Plaintiffs-Appellees, v. SWEDISHAMERICAN HOSPITAL et al., Defendants-Appellants (Richard Runstrom et al., Defendants-Appellees).
    Second District
    No. 2—89—0941
    Opinion filed July 17, 1990.

      Hugh C. Griffin and Nancy Shaw, both of Lord, Bissell & Brook, of Chicago, and Lord, Bissell & Brook and Frederic T. Brandt III, of Holmstrom & Green, both of Rockford (Jeffry S. Spears and Richard D. Gaines, of counsel), for appellants.
    Herbert I. Greene, of Greene, Bowman, Flaherty & McCarty, of Rockford (William M. Flaherty, of counsel), for appellees Linnea Pritchard, Edward Pritchard, and W. Donald Jones.
    Heyl, Royster, Voelker & Allen, of Peoria, and Douglas Pomatto and Kevin J. Luther, both of Heyl, Royster, Voelker & Allen, of Rockford (Karen L. Kendall, of counsel), for appellee Novella Schafer.
    Dale F. Conde, of Conde, Stoner & Killoren, of Rockford (Robert A. Calgaro, of counsel), for appellee Richard Runstrom.
   JUSTICE INGLIS

delivered the opinion of the court:

Plaintiffs, Linnea and Edward Pritchard, brought an action for medical malpractice in the circuit court of Winnebago County against defendants, SwedishAmerican Hospital (hospital), Dr. Richard Runstrom, Dr. W. Donald Jones, Dr. Novella A. Schafer, and Dr. Adrienne Butler. Plaintiffs voluntarily dismissed Dr. Jones from the action and entered into a settlement agreement with Dr. Schafer and Dr. Runstrom. The trial court found that the settlement agreement was entered into in good faith and discharged Schafer and Runstrom from liability for contribution pursuant to section 2(d) of the Contribution Among Joint Tortfeasors Act (Contribution Act) (Ill. Rev. Stat. 1987, ch. 70, par. 302(d)). Thereafter, the trial court denied the hospital’s and Dr. Butler’s motion for leave to file counterclaims for contribution against Schafer and Runstrom. Defendants hospital and Butler timely filed this appeal, contending that the trial court erred in finding that the settlement made was made in good faith. We affirm.

The record reveals that on July 3, 1985, Linnea and Edward Pritchard filed this medical malpractice action against SwedishAmerican Hospital and Dr. Runstrom. On March 5, 1986, plaintiffs filed an amended complaint adding Dr. Schafer and Dr. Jones as defendants. Dr. Butler was added as an additional defendant on April 28, 1986, by way of a second amended complaint. Numerous allegations of negligence were made against the defendant doctors regarding the care and treatment rendered to Linnea during her stay at the SwedishAmerican Hospital. Included among the allegations were the following: failure to order proper tests and treatment, failure to obtain proper consultations with specialists, inadequate monitoring of Linnea’s condition, allowing Linnea to develop hyponatremia and central pontine myelinolysis, and negligent administration of hypertonic saline solutions instead of normal saline to correct Linnea’s hyponatremia. Many of the same allegations were made against SwedishAmerican Hospital under a respondeat superior theory. Plaintiffs further alleged that the hospital negligently rendered hospital services, failed to intervene in Linnea Pritchard’s care, and allowed Dr. Runstrom to maintain hospital privileges.

Plaintiffs maintain that as a consequence of the above-alleged negligence, Linnea has suffered serious injuries that have confined her to a nursing home since June 1984. The injuries include permanent brain damage leaving her unable to speak, swallow, move her extremities or care for any of her daily needs.

In developing their case, plaintiffs engaged in substantial written and deposition discovery. Through this discovery it was adduced that Linnea Pritchard was admitted to SwedishAmerican on June 17, 1984, complaining of weakness in her left arm and leg, numbness, and other symptoms. At the time of her admittance, she had three provisional diagnoses: transient ischemic attack, irreparable bowel syndrome, and myeloproliferative disorder with platelets. Linnea’s attending physician was Dr. Runstrom. Runstrom, a general practitioner, called in several consultants during Linnea’s hospitalization, including Dr. Butler, a hematologist-oncologist.

On the evening of June 23, 1984, Linnea was vomiting and complaining that she could not swallow. Dr. Schafer, a general practitioner who was on call that evening, ordered Compazine for vomiting, aspirin, and a 5% glucose intravenous line (IV). Schafer testified that the IV was instituted in order to get a “line” into Linnea’s vein. This was done as a preventive measure in case Linnea went into shock. Schafer explained that “[i]f someone gets into shock you can’t get a vein easy so if you have a line in you can always switch your bags.” Schafer testified that she did not anticipate the need for the IV to be for a very long period of time. Schafer stated that after she left the hospital that evening she did nothing to follow up on her care of Linnea as that was normally the responsibility of the attending physician, in this case, Dr. Runstrom. Schafer testified that the contact that she had with Linnea on June 23, 1984, was the only occasion on which Dr. Schafer ever saw Linnea or ordered treatment for her.

On June 24, 1984, Dr. Butler, the consulting hematologist-oncologist called in by Dr. Runstrom, reviewed Linnea’s chart and indicated to Runstrom that she (Butler) “would no longer be following [Linnea] on a regular or daily basis but would be available in the event that there were some particular development or problem that he or anyone felt was within her area of specialty and expertise.”

On June 28, 1984, Linnea was reportedly not “doing well in a general sense,” so Dr. Runstrom called in Dr. Butler and ordered that electrolyte testing be done. The results of the tests indicated that Linnea’s sodium level was “very low,” and consequently, Dr. Butler instituted corrective therapy.

Plaintiff’s expert, Dr. Stanley Goldfarb, who specializes in nephrology (i.e., the science that deals with the kidneys), testified that the condition of ill-being from which Linnea Pritchard ultimately suffered was central pontine myelinosis. Goldfarb stated that Linnea’s condition was caused by either hyponatremia itself (i.e., deficiency of sodium in the blood) or the correction of hyponatremia. Goldfarb admitted that this is an area of significant dispute and disagreement among knowledgeable experts in the field of nephrology. Goldfarb stated that it was impossible for him to say when the hyponatremia first existed in Linnea, but opined that it was at some point prior to June 28, 1984.

Goldfarb stated that he believed that any physician that was involved in the care of Linnea after the episode of nausea and vomiting and after the initiation of the IV fluids (i.e., June 23, 1984) should have at least recommended that her electrolyte levels be checked. Specifically, Goldfarb criticized Dr. Schafer, Dr. Runstrom, and Dr. Butler. Goldfarb testified that Dr. Schafer had deviated from the standard of care by instituting the IV on June 23, 1984, without also ordering electrolyte testing. Plaintiff’s theory was that when the particular type of IV fluid that was used here is given, the patient’s sodium level is diluted. Therefore, a physician who orders such an IV should never do so without first checking the patient’s salt level in the blood.

According to Goldfarb, Dr. Runstrom’s “failure to monitor the patient’s fluid and electrolyte status properly” also constituted a departure from the standard of care. Goldfarb further testified that Dr. Butler deviated from the standard of care on June 24, 1984, by not recommending that Linnea have electrolyte testing done after Butler had reviewed Linnea’s chart, which indicated that the previous day Linnea was nauseated and vomiting, and IV fluids had been started without any notation as to what her electrolytes were.

The record reveals that on June 4, 1987, plaintiff voluntarily dismissed defendant Dr. W. Donald Jones from the lawsuit pursuant to section 2—1009 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2—1009). The record does not indicate the alleged part Dr. Jones played in the scheme of events leading up to the lawsuit; nonetheless, it is undisputed that he was dismissed from the suit by plaintiffs.

Although it is not clear from the record, defendant Dr. Runstrom apparently filed for bankruptcy subsequent to the filing of this lawsuit. Thereafter, in January 1988, Dr. Runstrom died. Mrs. Runstrom, Dr. Runstrom’s surviving spouse, was appointed special administrator of his estate as the cause of action pleaded by plaintiffs is one which survives the death of a party. Ill. Rev. Stat. 1987, ch. 110½, par. 27—6.

In July 1989, plaintiffs entered into a joint settlement agreement with Runstrom and Schafer. By its terms Runstrom agreed to pay $190,000 and Schafer agreed to pay $10,000 in exchange for plaintiffs’ release of all claims against these defendants. The settlement agreement was made contingent upon

“[t]he execution and delivery to Plaintiffs by Mrs. Richard Runstrom as surviving spouse and as Special Administrator of the Estate of Richard Runstrom, M.D. of a waiver of any privilege of Richard Runstrom, M.D., or his estate that may be created by the physician/patient privileges available in the State of Illinois, under the Mental Health and Developmental Disabilities Confidentiality Act and/or the Medical Studies Act and her consent to the release of and delivery to the Plaintiff’s [sic] attorneys any and all information, records and/or documents that otherwise would be privileged by reason of any of the above-stated privileges or Acts.”

On August 10, 1989, the circuit court entered a written order finding that the above settlement agreement was made in good faith (Ill. Rev. Stat. 1987, ch. 70, par. 302(c)) and discharging Runstrom and Schafer from any liability to any tortfeasor for contribution pursuant to the provisions of section 2(d) of the Contribution Act (Ill. Rev. Stat. 1987, ch. 70, par. 302(d)). On August 17, 1989, the circuit court entered a final order making an express finding pursuant to Supreme Court Rule 304(a) (107 Ill. 2d R. 304(a)) that the written order entered on August 10, 1989, was final and appealable and dismissing the complaint against defendants Runstrom and Schafer with prejudice. Defendants hospital and Dr. Butler filed a motion for leave to file counterclaims for contribution against Schafer and Runstrom which the circuit court denied. This timely appeal ensued whereby one issue is raised: whether the circuit court erred in finding that the settlement made between plaintiffs and defendants Runstrom and Schafer was made in good faith.

Section 2(a) of the Contribution Act provides that where two or more persons are subject to liability in tort arising from the same injury, there is a right of contribution among them. (Ill. Rev. Stat. 1987, ch. 70, par. 302(a).) However, an alleged tortfeasor who settles with a claimant in good faith is discharged from all contribution liability. (Ill. Rev. Stat. 1987, ch. 70, par. 302(d).) The Contribution Act does not define what constitutes a “good faith” settlement; the matter is largely left to the discretion of the trial court (Dixon v. Northwestern Publishing Co. (1988), 166 Ill. App. 3d 745, 751-52) based on arguments of counsel, affidavits, depositions, other discovery material, or evidence received at the hearing (Barreto v. City of Waukegan (1985), 133 Ill. App. 3d 119, 128). Once the settling parties represent to the court that they have reached a good-faith settlement and its terms are made known to the court, a presumption of validity arises (Ruffino v. Hinze (1989), 181 Ill. App. 3d 827, 829), and the burden of proof on the issue of good faith shifts to the party challenging the good-faith settlement (Barreto, 133 Ill. App. 3d at 128). In considering whether an agreement was made in good faith, the entire circumstances surrounding the settlement must be taken into account. (Ballweg v. City of Springfield (1986), 114 Ill. 2d 107, 122.) A settlement may be considered made in good faith when it is based on consideration (Doellman v. Warner & Swasey Co. (1986), 147 Ill. App. 3d 842, 849-50; see also Ballweg, 114 Ill. 2d at 122) and when no tortious or wrongful conduct on the part of the settling party has been shown. (Jachera v. Blake-Lamb Funeral Homes, Inc. (1989), 189 Ill. App. 3d 281, 286.) Because Illinois’ public policy favors peaceful and voluntary resolutions of claims through settlement agreements, clear and convincing evidence is required in order to establish the invalidity of such an agreement. Jachera, 189 Ill. App. 3d at 285.

Appellants, SwedishAmerican Hospital and Dr. Butler, argue that there was a lack of good faith in the instant settlement as evidenced by (1) Dr. Schafer’s unreasonably low settlement of $10,000; (2) the joint insurer of Drs. Runstrom and Schafer holding Dr. Runstrom’s insurance policy “hostage” in an attempt to force plaintiffs to accept an unreasonably low settlement for the case against Dr. Schafer; and (3) Dr. Runstrom’s estate improperly attempting to waive certain medical privileges.

As to their first argument, the hospital and Dr. Butler maintain that “Dr. Schafer’s $10,000 contribution is clearly disproportionate to any estimate of what her potential liability might be.” They contend that plaintiffs’ settlement demand against all defendants remained at $3 million up until the time the instant settlement was negotiated. However, as argued before the trial court, this is not an accurate summarization of the negotiations that occurred. Immediately prior to the settlement at issue here, all four remaining defendants put together a packaged offer totalling $450,000. Drs. Runstrom and Schafer were to contribute a total of $200,000 between them; the hospital was to contribute $200,000; and Dr. Butler was to contribute $50,000. That offer was made during the pendency of the first interlocutory appeal in this case (i.e., Pritchard v. SwedishAmerican Hospital (1989), 191 Ill. App. 3d 388) (Pritchard I). In Pritchard I, we held that certain information concerning Dr. Runstrom which was sought by plaintiffs from the hospital was privileged. The day on which we announced our decision in Pritchard I, April 25, 1989, the defendant hospital unilaterally withdrew its offer of $200,000. Thereafter, negotiations continued between plaintiffs and defendants Runstrom and Schafer. The $190,000 settlement at issue here was subsequently agreed upon. Thus, in light of the prior negotiations, the instant settlement would certainly appear to be reasonable.

However, appellants argue that Schafer’s settlement contribution of $10,000 does not reasonably reflect the settlement of plaintiffs’ claims against her. They cite to the serious injuries suffered by Linnea: specifically, permanent brain damage leaving her unable to speak, swallow, or move and confining her to a nursing home. Further, they argue that according to their expert’s testimony, Schafer deviated from the standard of care by ordering that certain fluids be administered to Linnea without also ordering electrolyte testing.

We find appellants’ argument to be unpersuasive for two reasons. First, even assuming that Schafer’s conduct on that occasion had been negligent, plaintiffs would still have to prove that Schafer’s negligence was a proximate cause of Linnea’s injury. (Petkus v. Girzadas (1988), 177 Ill. App. 3d 323, 327.) Plaintiffs’ counsel advised the trial court that proving such a causal relationship was a “real problem” because Linnea did not develop her condition until a considerable period of time after Schafer’s one-time involvement had ended, and several other physicians had intervened in Linnea’s treatment subsequent to that time. Where probable recovery is questionable, compromise of a disputed claim is entirely compatible with the policy underlying the Contribution Act, that is, to encourage good-faith settlements. (Mallaney v. Dunaway (1988), 178 Ill. App. 3d 827, 833; O’Connor v. Pinto Trucking Service, Inc. (1986), 149 Ill. App. 3d 911, 915-16.) Thus, given the arguable lack of probable cause presented here, plaintiffs’ settlement with Schafer would not appear to be unreasonable.

Further, the argument of appellants that the amount of Schafer’s settlement contribution did not reasonably reflect the settlement of plaintiffs’ claims against her has currently been rejected. (Christmas v. Hughes (1989), 187 Ill. App. 3d 453, 455.) The mere fact that an injured party’s actual damages exceed the amount of the settlement does not prove that the settlement was unreasonable. (Mallaney, 178 Ill. App. 3d at 833.) Therefore, given the above-mentioned circumstance, we do not find that the amount of settlement contribution paid by Schafer is sufficient indicia of bad faith.

As a second contention for their argument that the settlement agreement was not made in good faith, appellants maintain that Dr. Runstrom’s insurance policy was held “hostage” by the joint insurer of Drs. Runstrom and Schafer in an effort to force an unreasonably low settlement against Dr. Schafer. Both Runstrom and Schafer are covered by the same insurer, Medical Protective Company. Appellants maintain that Runstrom has a primary liability policy in the amount of $200,000 and Schafer has one in the amounts of $200,000/$600,00Q plus an excess policy. Appellants theorize that because of Dr. Runstrom’s death and bankruptcy, Medical Protective Company had no motive to pay Dr. Runstrom’s $200,000 policy limits in settlement of plaintiffs’ claim against Runstrom unless it could also eliminate its exposure for Dr. Schafer’s liability under the separate $200,000/ $600,000 policy. Appellants argue that such a settlement agreement is not in good faith and “ ‘does not fairly and reasonably allocate’ the settlement between Dr. Runstrom’s estate and the highly culpable Dr. Schafer” (citing Blagg v. Illinois F.W.D. Truck & Equipment Co. (1989), 186 Ill. App. 3d 955, 963).

Appellants’ reliance on Blagg for the proposition that the settlement agreement was not “fairly and reasonably” allocated is without merit. The settlement at issue in Blagg concerned the allocation of recovery for loss of consortium in light of a worker’s compensation lien. Section 5(b) of the Workers’ Compensation Act provides that an employer who has compensated an employee has a right to reimbursement from any compensation the employee receives from a suit against a third party. (Ill. Rev. Stat. 1987, ch. 48, par. 138.5(b); Blagg, 186 Ill. App. 3d at 959.) This court noted that we must not allow parties to circumvent clearly the employer’s lien by apportioning the bulk of the recovery to a loss of consortium claim; rather, the court must protect the employer’s right to reimbursement, which is to be given priority over the policy of favoring settlements. (Blagg, 186 Ill. App. 3d at 962.) We explained:

“The Contribution Act requires that a release to a joint tortfeasor be made in good faith. The test for this case, however, goes beyond a determination of good faith. Section 5(b) of the Worker’s Compensation Act provides that the court shall protect the employer’s lien. Thus, regardless of whether a court might find the settlement to be in good faith, the court must consider whether the employer’s lien is protected. *** [I]t must be determined whether the allocation is fair and reasonable. This determination should be made while keeping in mind the employer’s lien.” Blagg, 186 Ill. App. 3d at 963.

Given that there is no lien warranting protection in the case at bar, the additional requirement set forth in Blagg is simply inapplicable here. Thus, in determining whether the settlement was made in good faith, a review of the totality of the circumstances surrounding the settlement is necessary, including Runstrom’s solvency and the extent of insurance coverage available. (Wasmund v. Metropolitan Sani tary District (1985), 135 Ill. App. 3d 926, 930, citing River Garden Farms, Inc. v. Superior Court (1972), 26 Cal. App. 3d 986, 103 Cal. Rptr. 498.) The mere fact that the settlement agreement may have been advantageous to a party is not necessarily an indicium of bad faith. (McKanna v. Duo-Fast Corp. (1987), 161 Ill. App. 3d 518, 525.) As we have already determined, the probable recovery against Schafer was questionable. Further, given the condition of Dr. Runstrom and his estate, his exposure to liability was likely to be limited to the amount of his insurance policy. We believe that these are permissible circumstances to take into account when negotiating a settlement. As such, the totality of the circumstances does not indicate by clear and convincing evidence that the apportionment of the settlement was made in bad faith.

Finally, the nonsettling defendants argue that the waiver of privileges by Dr. Runstrom’s estate was against public policy and the resulting settlement was, therefore, not made in good faith. As part of the settlement agreement, Mrs. Runstrom, as surviving spouse and special administrator of Dr. Runstrom’s estate, agreed to waive “any privilege that may be created by the physician/patient privileges available in the State of Illinois, under the Mental Health and Developmental Disabilities Confidentiality Act and/or the Medical Studies Act.” (Emphasis added.) Appellants argue that in light of this court’s decision in Pritchard I such a waiver is against public policy. In Pritchard I, we found that the Medical Studies Act (Ill. Rev. Stat. 1987, ch. 110, par. 8—2101 et seq.) protected from public disclosure that information relied upon by the hospital in reviewing Dr. Runstrom’s privileges and competency to practice medicine at the hospital. (Pritchard, 191 Ill. App. 3d at 401.) We further held that information regarding whether Dr. Runstrom was a recipient of mental health services and his mental condition was privileged under the Mental Health and Developmental Disabilities Confidentiality Act (Ill. Rev. Stat. 1987, ch. 91½, par. 801 et seq.) and under the physician/patient privilege (Ill. Rev. Stat. 1987, ch. 110, par. 8—802). Pritchard, 191 Ill. App. 3d at 403-04.

Appellants contend that waiver of the above privileges is a “patent attempt to circumvent” this court’s holding in Pritchard I, which they contend is against public policy. We disagree. First, Mrs. Runstrom’s attempt to waive any privilege under the Medical Studies Act is likely to be ineffectual as the privilege belongs to the hospital and the members of the hospital’s peer review committees, not to the doctor being evaluated.

The Medical Studies Act provides in pertinent part: “All information, interviews, reports, statements, memoranda or other data of the *** committees of licensed or accredited hospitals or their medical staffs *** used in the course of internal quality control *** or for improving patient care, shall be privileged, strictly confidential and shall be used only for medical research, the evaluation and improvement of quality care, or granting, limiting or revoking staff privileges ***.” (Ill. Rev. Stat. 1987, ch. 110, par. 8-2101.)

The purpose of the Act “is to ensure the effectiveness of professional self-evaluation, by members of the medical profession, in the interest of improving the quality of health care.” (Jenkins v. Wu (1984), 102 Ill. 2d 468, 479-80.) The belief is that “absent the statutory peer-review privilege, physicians would be reluctant to sit on peer-review committees and engage in frank evaluations of their colleagues.” (Jenkins, 102 Ill. 2d at 480.) Because the privilege is not intended to benefit the physician being reviewed, that physician is unable to waive it, and any attempt to do so is likely to be ineffective. (See Newton v. Meissner (1979), 76 Ill. App. 3d 479, 498.) Thus, this case is distinguishable from Swank v. Bertuca (1976), 41 Ill. App. 3d 229, where the parties’ stipulation to waive objections, if enforced by the court, would have been effective in admitting inadmissible evidence.

Second, with respect to that information protected by the Mental Health and Developmental Disabilities Confidentiality Act and the physician/patient privilege, it is clear that Dr. Runstrom’s estate can waive these privileges and allow disclosure of the confidential information concerning Runstrom as a patient. (See Bland v. Department of Children & Family Services (1986), 141 Ill. App. 3d 818, 826; Novak v. Rathnam (1985), 106 Ill. 2d 478, 484.) We find such a waiver to be permissible, effective, and consistent with public policy. We make no comment as to the necessity of also receiving the therapist’s consent, as that issue is not before the court. Ill. Rev. Stat. 1987, ch. 91½, par. 805(e).

Because appellants have failed to present any evidence supporting their contention that the settlement was not entered into in good faith, much less the required clear and convincing evidence necessary to invalidate the settlement, we affirm the judgment of the circuit court.

Affirmed.

McLAREN and GEIGER, JJ., concur.


source: Caselaw Access Project

author: JUSTICE GEIGER

license: Public Domain

text:
      In re MARRIAGE OF EDGAR FELDMAN, Petitioner-Appellee and Cross-Appellant, and INA Y. FELDMAN, Respondent-Appellant and Cross-Appellee.
    Second District
    No. 2—89—0653
    Opinion filed July 18, 1990.

      Randy K. Johnson, of Law Office of Robert A. Chapski, Ltd., of Elgin, for appellant.

      Schaffner & Anderson, Chartered, of West Dundee (Harry Schaffner, of counsel), for appellee.
   JUSTICE GEIGER

delivered the opinion of the court:

The respondent wife, Ina Y. Feldman, appeals from the trial court’s property, maintenance, and fee awards pursuant to the dissolution of her marriage to the petitioner husband, Edgar Feldman. The husband brings a cross-appeal. We reverse and remand.

The parties were married in 1959, when the husband was 23 and the wife was 22 years old. Four children were born to the marriage; all of them were emancipated when the dissolution was entered in 1988.

The husband is one of two principal shareholders in a professional corporation: General and Vascular Surgery, Ltd. (the practice). His gross taxable income in 1987 was $265,000. During the 29-year marriage the wife had primary responsibility for household affairs; she also was employed as a certified speech therapist. She has some graduate credits in her field and is employed at an annual $29,440 salary.

The court received extensive testimony about the parties’ financial condition and awarded the marital property as follows. The wife received $549,311 in assets, including the marital home. The husband received $593,514 in assets, including the practice. The parties’ debts on pension and profit sharing funds were allocated jointly; the $25,000 mortgage was allocated to the wife, and $72,300 in miscellaneous debts to the husband. The court ordered that the husband pay $2,500 monthly maintenance payments to the wife, reviewable on every three-year anniversary of the order. Lastly, without holding a hearing, the court ordered each party to pay his own attorney fees.

On appeal the wife first argues that, in distributing marital property, the court erred in not considering three marital assets: the practice’s accounts receivable, the husband’s interest in a professional building, and compensation due the practice for the husband’s work as head of a hospital trauma center. We agree with the wife on all three points.

The Illinois Marriage and Dissolution of Marriage Act (the Act) provides for equitable division of all “marital property” upon dissolution of a marriage. (Ill. Rev. Stat. 1987, ch. 40, par. 503.) To determine the value of a business which is marital property, the court must consider (1) fixed assets, (2) other assets, including accounts receivable, (3) the goodwill in the business, and (4) business-related liabilities. In re Marriage of Rubinstein (1986), 145 Ill. App. 3d 31, 36.

The court’s careful and thoroughly presented written judgment discloses that, in determining the value of the practice, it excluded the practice's accounts receivable. The husband argues that the court correctly considered those amounts as future income. Under our decision in Rubinstein, however, the court’s omission was erroneous: the accounts receivable are business assets and must be included in the practice’s valuation.

The wife also refers to one specific account receivable apparently excluded in the trial court’s business valuation. The record shows that as of the date of dissolution, the husband had earned over $20,000 as trauma service director for Sherman Hospital. The practice, which was entitled to receive that salary payment, had collected none of those monies. Under Rubinstein, the court erroneously excluded consideration of this account receivable.

Also in relation to the court’s valuation of the parties’ marital property, the wife urges that the court abused its discretion by placing a value of $0 on the husband’s interest in the West Side Professional Building (the building). The husband testified that he owned 26.67% interest in the building. Also, he opined that the building was worth $164,000. On appeal, he suggests that the court’s $0 valuation either reflects or is counterbalanced by the court’s determination on indebtedness related to the building.

The court received no evidence that the building was valueless. Further, the court’s judgment order thoroughly accounted for the parties’ debts without specifically applying debt against the building’s value. We find that the $0 valuation was an abuse of the trial court’s discretion.

Because the husband’s counterargument bears relation to this first of the wife’s arguments, we next address that counterargument: that the court improperly included a figure for “goodwill” in valuing the husband’s practice. The husband urges that we reconsider our decision in In re Marriage of Rubinstein (1986), 145 Ill. App. 3d 31, which stands for inclusion of goodwill in the business evaluation.

According to the husband, in valuing a professional practice the court should consider goodwill without fixing a specific value. He argues with support of other appellate districts’ decisions, that if the court both includes goodwill in the business valuation and awards maintenance, it double counts the asset of “likelihood of future income,” which is the basis for both awards. See Head v. Head (1988), 168 Ill. App. 3d 697; In re Marriage of Kapusta (1986), 141 Ill. App. 3d 1010; In re Marriage of Courtright (1987), 155 Ill. App. 3d 55; In re Marriage of Stone (1987), 155 Ill. App. 3d 62.

After considering the husband’s argument, we find no reason to depart from our prior conclusion in Rubinstein, that a fair and just disposition of marital property requires considering goodwill in valuing a professional corporation. The intangible asset of goodwill clearly affects a shareholder’s future earnings from a business. However, that is equally true of other business assets and is no basis to restrict consideration of that factor. We find no abuse of discretion in the court’s inclusion of $96,500 goodwill in valuing the husband’s practice.

In her more general comments regarding the property distribution, the wife argues that the court abused its discretion in failing to properly consider the statutory factors for the distribution. (See Ill. Rev. Stat. 1987, ch. 40, par. 503(d).) She emphasizes her multiple roles in the marital household, the length of the marriage, and the parties’ relative training, economic circumstances, and health.

We are not persuaded by the thrust of the argument. The record reveals that the court carefully considered all the relevant statutory factors, including those emphasized by the wife. Nevertheless, we reverse the court’s property distribution and remand for redistribution which includes the items of marital property erroneously omitted from the original judgment. See In re Marriage of Olsher (1979), 78 Ill. App. 3d 627, 636-37.

The wife makes two additional arguments which are also relevant on remand of the property distribution. First, she argues that the court abused its discretion in failing to allocate tax consequences of withdrawing funds from the parties’ profit-sharing and pension funds. Her argument is meritless. The trial court judge explicitly stated that his judgment considered tax consequences.

Secondly, the wife argues that court abused its discretion in refusing to reopen proof on the value of a brokerage account in the marital property. The wife asserts that the account’s value fell from the evidenced $8,900 to a value of $900 on the date of judgment.

Whether to reopen proof is a matter for the trial court’s discretion, taking into account any excuse for the failure to introduce the relevant evidence at trial and any surprise or unfair prejudice to the opposing party; we will not disturb the court’s decision absent a clear abuse of discretion and substantial injustice. (In re Marriage of Suarez (1986), 148 Ill. App. 3d 849, 858.) Because we reverse on other grounds, we need not decide whether the court’s decision here was an abuse of discretion. However, we note that assets are to be valued on the date of dissolution (In re Marriage of Courtright (1987), 155 Ill. App. 3d 55, 59).

The wife’s next arguments relate to her maintenance award. Basically, the wife argues that her maintenance award was inadequate. She refers to the marital property omitted from the court’s consideration. She also challenges that the court gave inadequate consideration to several statutory factors regarding determination of maintenance: the time needed for her to secure education for appropriate employment, the standard of living established during the lengthy marriage, the parties’ relative physical and mental conditions, and the husband’s ability to pay (Ill. Rev. Stat. 1987, ch. 40, pars. 504(b)(2) through (b)(6)). The wife also asserts that the court erred in ordering that the award be reviewable every three years and in finding that it lacked authority to secure the award, for example with a life insurance policy.

Our analysis on this issue is akin to our analysis on the wife’s argument regarding marital property distribution. We find ample evidence that the court properly considered all the relevant statutory factors, including those that the wife emphasizes here. However, based upon our determination that the court erroneously excluded several items of marital property from its consideration, we reverse the maintenance award for redetermination based upon all the marital property. See In re Marriage of Olsher (1979), 78 Ill. App. 3d 627, 636-37.

As may be relevant on remand, we also find no abuse of discretion in the court’s determination that it would review the maintenance award once every three years. The court’s order appropriately reflected both uncertainty about the parties’ financial futures (see In re Marriage of Heller (1987), 153 Ill. App. 3d 224, 235) and the statutory provisions for modification in the case of substantially changed circumstances (Ill. Rev. Stat. 1987, ch. 40, par. 510).

Regarding the court’s authority to enter a maintenance award secured by life insurance, we find no abuse of discretion in the court’s failure to consider that sort of security award. We agree with the reasoning of the court in In re Marriage of Clarke (1984), 125 Ill. App. 3d 432, cited by neither party. The Clarke court concluded that, absent the parties’ agreement, the court had no authority to order security for the husband’s payment of the wife’s unallocated maintenance after his death. In this analogous setting, the court properly found a lack of authority to order a secured maintenance award.

Lastly, we address the wife’s arguments regarding attorney fees. The wife argues, and we agree, that the court abused its discretion in denying her request for a hearing on attorney fees. As the husband argues, the wife has no statutory entitlement to attorney fees and the fees hearing will prolong the proceedings. Nevertheless, when attorney fees are contested, the court must conduct a hearing on that issue. (Sahs v. Sahs (1977), 48 Ill. App. 3d 610, 613.) Upon remand, the court shall, of course, consider all the relevant factors, including its modified decisions on division of assets and maintenance, to determine if attorney fees are appropriate and, if so, in what amount. See In re Marriage of Olsher (1979), 78 Ill. App. 3d 627, 636-37.

Based on the foregoing, we reverse the judgment of the circuit court of Kane County and remand the cause for further proceedings consistent with this opinion.

Reversed and remanded.

UNVERZAGT, P.J., and WOODWARD, J., concur.


author: PRESIDING JUSTICE UNVERZAGT

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. RICHARD HARRIS, Defendant-Appellant.
    Second District
    No. 2—89—0273
    Opinion filed July 18, 1990.

      G. Joseph Weller and Kathleen J. Hamill, both of State Appellate Defender’s Office, of Elgin, for appellant.
    Fred L. Foreman, State’s Attorney, of Waukegan, and John Thomas Moran, of Law Offices of John Thomas Moran, of Chicago (William L. Browers, of State’s Attorneys Appellate Prosecutor’s Office, of counsel), for the People.
   PRESIDING JUSTICE UNVERZAGT

delivered the opinion of the court:

Defendant, Richard L. Harris, was convicted of burglary under section 19—1(a) of the Criminal Code of 1961 (Ill. Rev. Stat. 1987, ch. 38, par. 19—1(a)). He appeals, contending the trial court erred by denying his motion to suppress evidence. The issue is whether the driver of defendant’s car had authority to consent to the search of the car in which the proceeds of the burglary were discovered when defendant was present but kept silent.

At the hearing on defendant’s motion, Officer Halley of the Highland Park police department testified that he was on duty at 3:54 a.m. on November 8, 1988. At that time, he was proceeding southbound on Route 41 in Lake County. He received a radio transmission that a burglary had just occurred at the Sensations clothing store at 599 Elm Street, which was two miles from his location. There were no cars on the highway at that time, but within two minutes, a yellow Cadillac entered the expressway and accelerated rapidly. Officer Halley positioned his squad car four lengths behind the Cadillac and followed it for 0.3 to 0.4 miles. The Cadillac maintained a speed of 63 miles per hour, but the speed limit was 50 miles per hour, so the officer stopped the Cadillac, which parked by the center median.

Officer Halley approached the car and observed two men in the front seat. The driver’s side window was broken, and glass lay about the interior. Officer Halley identified the passenger as defendant and the driver as Melvin Baker. Halley asked Baker for his driver’s license, but Baker responded that he did not have it with him. Several times Halley asked the driver for his name, but Baker did not give an answer. Halley asked Baker where he was going. Baker responded that he was headed towards Wisconsin, became lost, took an overpass and started going southbound on the highway to get to Wisconsin. The Wisconsin border is north of Lake County, Illinois. Halley next asked Baker if it would be all right to look in the trunk of the car. According to Halley, Baker said that “it would be all right, but he did not have the keys to the vehicle as it was not his car.” Halley asked Baker whose car it was, but Baker told him only that it belonged to a friend. Baker did not identify the passenger in the car. Officer Halley testified that Baker made these statements while standing outside the car while defendant remained seated in the passenger seat. Defendant said nothing during the entire conversation although he was only five feet away. Halley stood right outside the broken window.

Officer Coffee arrived on the scene and heard Officer Halley talking to the driver. Officer Coffee testified that Baker was seated in the driver’s seat at the time and that Baker told Halley that he could look in the trunk but did not have the key. Coffee also testified defendant remained silent. Defendant and Baker were removed from the car and walked to Coffee’s squad car. Officer Halley reached into the glove compartment and activated the trunk release. Numerous items of women’s garments from the Sensations clothing store were in plain view once the trunk was open. Halley did not specifically ask permission to enter the glove compartment. After the State rested, defendant did not present any evidence.

The trial court made the following remarks when denying the motion to suppress evidence:

“The officer’s testimony is uncontradicted that the car was speeding. I think that gives him a right to stop the car. I think when the driver fails to produce a license and doesn’t identify himself — and really the question is the officer had no reason to suspect that .the owner was in the car. In fact he had every reason to expect that the owner was not in the car—
MR. KEEFE [Defense counsel]: But he made—
THE COURT: — because when the driver said well, you can open the trunk, but I don’t have the keys because it’s not my car, the officer could have reasonably, it seems to me, taken that to mean that the passenger didn’t have the keys either. He didn’t say, gee, I don’t own the car, I don’t have the keys, but here’s the owner, he should have the keys. I think the stop was based on probable cause. I think the driver of the car had the authority to consent to the search of the car.
I don’t think there’s an obligation on the part of the police officer to advise the driver that he could refuse the search as long as he didn’t coerce the consent. I think he gave the consent to search the car and then applied the consent to reach in and press the button and open the trunk, and I’ll deny the motion.”

Defendant contends that the search of the car was unreasonable because Baker did not have the authority to consent to the search and his statement was merely a polite refusal rather than an explicit agreement. Defendant does not contend the consent was coerced or involuntarily given. The State argues that the court’s decision was not manifestly erroneous and that the stolen goods would have been discovered inevitably when the car was impounded. The State has not argued that the warrantless search of the car was permissible because the officers had probable cause to believe the car contained evidence. Probable cause exists when, considering the totality of circumstances known to the officer at the time of the search, a reasonable person would have believed evidence was inside. (People v. Penny (1989), 188 Ill. App. 3d 499, 502.) Stopping a car for a minor traffic violation does not by itself justify a search, and an officer’s authority to investigate a traffic violation may not serve as a subterfuge to obtain other evidence based on mere suspicion. 188 Ill. App. 3d at 502.

The trial court’s ruling on a motion to suppress evidence will not be overturned unless it was manifestly erroneous. (People v. Murray (1990), 137 Ill. 2d 382, 386-87.) A person may consent to a search conducted without a search warrant, but in order for the consent to be considered a waiver of his fourth amendment rights, the State must prove by a preponderance of the evidence that the consent was voluntarily given. (People v. Smith (1984), 124 Ill. App. 3d 914, 919.) Where a search is justified on the ground of consent, the trial court’s finding will not be disturbed on appeal unless it is manifestly erroneous. People v. Froio (1990), 198 Ill. App. 3d 116, 123.

The trial court found that Baker consented to the search and that he had authority to consent. We do not believe these findings to be manifestly erroneous. In addition, we do not believe that Baker’s authority was negated by the owner of the car sitting silently in the passenger seat.

Defendant contends that Baker’s response that it would be all right to look in the trunk but for the lack of keys was merely a polite refusal, akin to: “I’d love to come to your Tupperware[TM] party, but I have a dental appointment for the same Sunday evening.” Nevertheless, it was an approval of the police officer’s request, and our law enforcement officers cannot take the role of arbitrators of etiquette. Although defendant’s response was similar to those in Froio (198 Ill. App. 3d at 119-20) and People v. Beroukas (1981), 98 Ill. App. 3d 990, 992, in those cases, there was other evidence contradicting the officers’ accounts of the conversation. The record contains an uncontradicted account of Baker’s response, and the trial court could well have interpreted it as another evasive response whereby Baker sought to alleviate suspicion while hoping the officers did not know of the trunk release. Thus the trial court’s finding that Baker consented to the search was not manifestly erroneous.

Baker also had authority to consent to the search of defendant’s car. Any person who has access to or control of property for most purposes has authority to consent to a search of it. (People v. Foskey (1990), 136 Ill. 2d 66, 87; People v. Bolden (1987), 152 Ill. App. 3d 631, 635.) While it is obvious that Baker had apparent authority to consent to the search (see United States v. Miller (7th Cir. 1986), 800 F.2d 129, 133), we do not rely on that ground because Illinois courts have rejected the theory of apparent authority to consent to a search as being inconsistent with the rights of privacy and property (People v. Miller (1968), 40 Ill. 2d 154, 157; People v. Vought (1988), 174 Ill. App. 3d 563, 570). However, a third party may give legally sufficient consent for a search if he has actual authority over the property shared in common with the defendant. (United States v. Matlock (1974), 415 U.S. 164, 171, 39 L. Ed. 2d 242, 250, 94 S. Ct. 988, 993.) By allowing the driver to exercise authority over a vehicle, a defendant assumes the risk that the driver will allow someone to look inside it. People v. Miller (1975), 36 Ill. App. 3d 542, 549.

A driver of a car has the authority to consent to a search of that car because he is the person having immediate possession and control of the vehicle. (United States v. Morales (3d Cir. 1988), 861 F.2d 396, 399.) As the driver, he has joint access and control over the entire vehicle, including its trunk, glove compartment and other components. (861 F.2d at 399; 3 W. LaFave, Search & Seizure §8.6(a), at 316 (2d ed. 1987).) A nonowning driver, of course, is limited in his authority to those parts over which he has been given access, and not over other parts which he has been restricted from accessing. (3 W. LaFave, Search & Seizure §8.6(a), at 316 (2d ed. 1987) (“[i]f, for example, the owner hands over both the ignition key and the trunk key, then the bailee may consent to a search of the trunk”); Morales, 861 F.2d at 399 n.7 (“If, however, a driver’s control is limited, in that he does not have a key or other means of access to the trunk or glove box, the scope of his authority to consent to search of those areas is similarly limited”); Ledda v. State (Del. 1989), 564 A.2d 1125, 1128 n.1 (“There is no evidence in the record that Morzella’s control of the vehicle was limited in any way, such as the lack of a key, or other means of access to the trunk or glove compartment”).) Although Baker said he did not have a key to the trunk, he had another means of access, namely, the trunk release, which was within easy reach; thus, he had access to and control of the trunk and could consent to the search of it.

Baker’s consent was not negated by the presence of defendant in the car. Defendant, it is true, had the actual authority over the car, but he had the power to delegate common authority to Baker and to revoke it at any time. Defendant was silent during the conversation with Baker and never expressed his ownership interest or evidenced a revocation of Baker’s common authority. Defendant was silent during the conversation with Baker, never expressed his ownership interest, and did not refuse the consent to the search. (People v. Callaway (1988), 167 Ill. App. 3d 872, 880.) Defendant was within hearing range of. the conversation but did not object and cannot now argue the search was illegal because he did not consent. (People v. Klein (1983), 115 Ill. App. 3d 582, 587.) Such behavior is inconsistent with a contention that defendant retained an expectation of privacy. (United States v. Anderson (3d Cir. 1988), 859 F.2d 1171, 1177.) While there is some authority to suggest a driver cannot validly consent when the owner is present as a passenger (see Morales, 861 F.2d at 404 (Sloviter, J., dissenting) (“In Matlock, the Supreme Court specifically noted that the case involved admitting the fruits of the search ‘against the absent, nonconsenting person,’ 415 U.S. at 170, [39 L. Ed. 2d at 249,] 94 S. Ct. at 993”); 3 W. LaFave, Search & Seizure §8.6, at 27 (Supp. 1990)), we do not believe such presence to be determinative of whether the driver has consented, especially when the owner does not assert his rights (Ledda, 564 A.2d at 1128; see also Klein, 115 Ill. App. 3d at 587). While, as Justice Sloviter suggests, the driver’s control and access to certain areas may be limited by the owner, i.e., if there was a need to get into the trunk the owner could do it (Morales, 861 F.2d at 404), there was no evidence that defendant put any restrictions on Baker’s control of the car.

The trial court’s comments reveal that, using an objective standard, a reasonable person would not have believed the owner was in the car. The driver failed to produce a license, refused to identify himself, said the car belonged to an unnamed friend rather than the passenger and said he did not have the key to the trunk; moreover the window was broken, indicating a possible stolen vehicle. While evenhanded law enforcement is best achieved by the application of objective standards rather than standards that depend upon the subjective state of the officer (Horton v. California (1990), 495 U.S._, _, 110 L. Ed. 2d 112, 124, 110 S. Ct. 2301, 2308), the officers’ reasonable belief pertains only to Baker’s apparent authority rather than his actual authority. Nevertheless, the evidence adduced at the hearing supports the court’s findings that Baker had actual authority to control the car, had access to the trunk and thus had actual authority to consent to the search of the trunk. The trial court did not err by denying the motion to suppress the evidence found in the trunk.

For the above reasons, the judgment of the circuit court of Lake County is affirmed.

Affirmed.

DUNN and McLAREN, JJ., concur.


text:
    MICHAEL K. BUTLER, Adm’r of the Estate of Rebecca L. Butler, Deceased, Plaintiff-Appellee, v. ECONOMY FIRE AND CASUALTY COMPANY, Defendant-Appellant.
    Second District
    No. 2—89—1024
    Opinion filed July 18, 1990.

      Daniel E. Compton and William R. Ketcham, both of Brittain, Ketcham, Strass, Terlizzi, Flanagan, Weir & Johnson, RC., of Elgin, for appellant.
    Jonathan L. Carbary, of Roeser, Vucha & Carbary, of Elgin, for appellee.
   JUSTICE GEIGER

delivered the opinion of the court:

The action which is the subject of this appeal was filed in the circuit court of Kane County seeking a declaration of rights under an insurance policy issued by the defendant, Economy Fire and Casualty Company, to Rebecca L. Chambers, the original plaintiff in this action. The plaintiff also sought an award of attorney fees pursuant to section 155 of the Illinois Insurance Code (the Code) (Ill. Rev. Stat. 1987, ch. 73, par. 767). The trial court entered summary judgment in favor of the plaintiff, but it refused to award attorney fees. The defendant now appeals from the entry of summary judgment, and the substituted plaintiff appeals separately from the denial of his request for attorney fees.

Two issues are raised on appeal: (1) whether the plaintiff’s declaratory action was not timely because it was not brought within two years of the occurrence of the plaintiff’s loss; and (2) whether the trial court abused its discretion in finding that the defendant’s refusal to pay the plaintiff’s claim did not constitute unreasonable and vexatious delay entitling the plaintiff to an award of attorney fees.

The original plaintiff, Rebecca L. Chambers, was issued an automobile insurance policy by the defendant on June 25, 1986. The policy contained a provision labelled “UNINSURED MOTORISTS COVERAGE AMENDATORY ENDORSEMENT” (the uninsured motorist coverage) regarding that portion of the policy pertaining to “FAMILY PROTECTION-UNINSURED MOTORISTS COVERAGE.” The uninsured motorist coverage contained the following provisions relevant here:

“The uninsured or underinsured owner’s or operator’s liability for these damages must arise out of the ownership, maintenance or use of the uninsured motor vehicle or underinsured motor vehicle. We will pay damages under this coverage caused by an accident with an underinsured motor vehicle, only after the limits of liability under any applicable bodily injury liability bonds or policies have been exhausted by payment of judgements or settlements.
* * *
EXCLUSIONS
A. We do not provide Uninsured/Underinsured Motorists Coverage for bodily injury or property damage sustained by any person:
1. If that person or the legal representative settles the bodily injury or property damage claim without our consent.
* * *
7. No suit, action or arbitration proceedings for the recovery of any claim under Family Protection — Uninsured Motorists Coverage shall be sustainable in any court of law or equity unless the insured shall have fully complied with all of the terms of the policy, nor unless commenced within two years after the occurrence of the loss.
* * *
ARBITRATION
If we and a covered person disagree whether that person is legally entitled to recover damages from the owner or operator of an uninsured or underinsured motor vehicle or do not agree as to the amount of damages, either party may make a written demand for arbitration.” (Bold face in original.)

On September 11, 1986, Rebecca Chambers was a passenger in an automobile driven by Joseph W. Shearer which was struck by an automobile owned by Patricia Zielke and driven by Donald E. Shanks, Jr. Chambers sustained injuries in the accident which required medical treatment and hospitalization. Chambers notified the defendant of the accident approximately six weeks later.

After the accident, Chambers filed an action in the circuit court of Kane County (the personal injury action) against several of the parties involved or their representatives (the personal injury defendants) to recover for her injuries. Both Shanks and Zielke, who were defendants in the personal injury action, were covered by insurance policies with limits of $25,000/$50,000. The personal injury action was still pending at the time this appeal was taken, and no judgment or settlement had been reached.

Although the record reveals several communications between Chambers’ representatives and the defendant in the period following the accident, Chambers never made a demand on the defendant for payment of any amount owed under the policy’s uninsured motorist coverage. At some point, the defendant made known its determination that it was not liable to pay any amount to Chambers under the uninsured motorist coverage because no suit, action, or arbitration proceedings had been filed against the defendant within two years of the accident.

Chambers initiated the instant action on November 9, 1988. Subsequently, Chambers, whose name had been changed to Rebecca L. Butler, was killed in an unrelated incident. Michael K. Butler, administrator of the estate of Rebecca L. Butler, was named as the substituted plaintiff (hereinafter referred to as the plaintiff.) Count I of the complaint sought a declaration of the parties’ rights under the policy. Count II alleged that the defendant’s “refusal and denial to honor coverage under the uninsured motorist insurance is vexatious and unreasonable and designed to unreasonably delay settlement of Plaintiff’s claim” and sought an award of attorney fees pursuant to section 155 of the Code.

Both parties moved for summary judgment, apparently on count I alone without reaching the attorney fees issue. The plaintiff’s motion for summary judgment stated that he could not ’’make a demand upon Defendant to settle under the terms of the uninsured motorists coverage” without first exhausting the insurance policy limits of the defendants as required by the policy (the exhaustion clause). The plaintiff argued that, until recovery was had against the defendants in the personal injury action, it would be premature to demand that the defendant pay out under the uninsured motorist coverage. The plaintiff filed a supplement to his motion for summary judgment which argued that the defendant should be estopped from denying coverage because its communications with the plaintiff created “a reasonable belief” that the claim would be paid.

The defendant also filed a motion for summary judgment. The defendant argued that, although the plaintiff could not be paid on a claim against the defendant until he had exhausted the other policy limits, the plaintiff could have demanded payment or taken other action to assert the claim within two years of the accident. The fact that the plaintiff failed to do so within two years of the accident, the defendant argued, acted to bar the claim pursuant to the policy’s time limitation (limitation clause). The defendant asked that the plaintiff’s suit be dismissed with prejudice.

A hearing on the cross-motions for summary judgment was held on June 8, 1989. The trial court took the issue under advisement and issued a memorandum opinion on July 10, 1989. The court noted that the “language of the policy is confusing to the point of being misleading.” The court held that the plaintiff could not have filed a demand for payment or arbitration against the defendant because the nature and extent of damages, and the sufficiency of the personal injury defendants’ coverage, had not yet been determined in the personal injury lawsuit. Accordingly, the court indicated that it would grant the plaintiff’s motion for summary judgment. The order did not deal with the question of attorney fees.

The plaintiff submitted a petition for attorney fees pursuant to section 155 of the Code which set out a schedule of fees incurred by the plaintiff’s attorneys. At a hearing held September 5, 1989, the trial court entered an order denying the petition for attorney fees because the defendant’s refusal to pay the plaintiff’s claim did not constitute “unreasonable and vexatious delay.” At this time, the trial court also entered a written order memorializing the summary judgment ruling made in its earlier memorandum opinion. The defendant filed a notice of appeal from the entry of summary judgment on October 5, 1989, and the plaintiff filed his notice of appeal from the denial of the petition for attorney fees on October 11, 1989. Our jurisdiction over both appeals is appropriate pursuant to Supreme Court Rule 301 (107 Ill. 2d R. 301).

Before we address the parties’ arguments, we must resolve the plaintiff’s motion, which was ordered taken with the case, to strike from the defendant’s brief any argument pertaining to the issue of estoppel. The plaintiff contends that the trial court’s ruling did not deal with the estoppel argument and that, therefore, any reference to this issue on appeal is inappropriate. We agree. Although this court may affirm the judgment of the trial court on any basis justified by the record (Hay v. Albrecht (1988), 169 Ill. App. 3d 120, 125), the plaintiff has not argued the estoppel issue on appeal. Because we believe that the resolution of this appeal does not require us to address estoppel, we grant the plaintiff’s motion to strike from the defendant’s brief any argument in this regard.

We first address the defendant’s appeal of the entry of summary judgment in favor of the plaintiff. The defendant contends that the trial court should have entered summary judgment in its favor. The defendant argues that the policy language clearly and unambiguously required the plaintiff to initiate a demand for settlement or arbitration upon the defendant within two years of the accident. The plaintiff contends that the trial court correctly found the policy language to be ambiguous in this regard, and he argues that the trial court’s interpretation of his obligations under the policy was correct.

A trial court should grant summary judgment where 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 a judgment as a matter of law.” (HI. Rev. Stat. 1989, ch. 110, par. 2—1005(c).) In ruling on a motion for summary judgment, the trial court must consider all of the evidence before it and construe it most strictly against the movant and liberally in favor of the party against whom judgment is sought. Summary judgment is a drastic means of disposing of litigation and should be granted only when the right of the moving party is clear and free from doubt. (Purtill v. Hess (1986), 111 Ill. 2d 229, 240.) Contracts of insurance are subject to the same rules of construction applicable to other type of contracts. (International Minerals & Chemical Corp. v. Liberty Mutual Insurance Co. (1988), 168 Ill. App. 3d 361, 370.) Where, as here, the facts are not in dispute, the interpretation of a contract is a question of law which can be decided on a motion for summary judgment. However, as a question of law, the interpretation of a contract can be made on review independently of the trial court’s judgment. Shorr Paper Products, Inc. v. Aurora Elevator, Inc. (1990), 198 Ill. App. 3d 9,12-13.

The defendant argues that the policy language concerning the time within which the plaintiff had to act in order to come within the policy’s coverage is clear and unambiguous. The trial court felt that the “language of the policy is confusing to the point of being misleading” because of the apparent conflict between the exhaustion provision and the limitations provision. The trial court apparently accepted the plaintiff’s contention that it was impossible to act within the two-year period specified by the limitation provision until the insurance coverage of the personal injury defendants had been exhausted, a process which was not resolved within two years.

We believe that the question of whether the policy is ambiguous or confusing depends on the date upon which the two-year time period in the limitations clause is triggered. The policy merely states that the insured must initiate any “suit, action or arbitration proceedings *** within two years after the occurrence of the loss.” The defendant appears to assume that the phrase “occurrence of the loss” is synonymous with the date of the accident in which the plaintiff suffered injury. Were this so, then we would agree with the trial court that the limitations clause appears to conflict with the exhaustion clause. An insured often must bring suit in order to exhaust the coverage of an underinsured motorist, a process which could, as here, take more than two years.

In construing a contract, it is presumed that all provisions were inserted for a purpose, and conflicting provisions will be reconciled if possible so as to give effect to all of the contract’s provisions. (Magnuson v. Schaider (1989), 183 Ill. App. 3d 344, 358.) We note that there is another interpretation to the phrase “occurrence of the loss” which would eliminate any conflict between the exhaustion clause and the limitations clause.

In the context of the uninsured motorist coverage, the “loss” which will be incurred by the plaintiff is that of damages to the extent that they exceed the insurance policy limits of the defendants in the personal injury action. In other words, the “loss” stems from the tort-feasors’ underinsurance relative to the plaintiff’s damages. We believe that the plaintiff cannot be said to have suffered a loss until it is determined, either by judgment in or settlement of the personal injury lawsuit, whether the insurance coverage of the defendants in the personal injury action is sufficient to compensate the plaintiff for the damages incurred.

We recently addressed a similar situation in our decision in Heneghan v. State Security Insurance Co. (1990), 195 Ill. App. 3d 447. In Heneghan, the plaintiff was insured under a policy requiring that the plaintiff must assert an uninsured motorist claim against the insurer “within two (2) years after the occurrence of the loss.” (195 Ill. App. 3d at 449.) The plaintiff claimed that a certain uninsured driver was liable for the plaintiff’s injuries, but the uninsured motorist contested liability. We determined that “it would be absurd to require plaintiff to file a claim for arbitration of an uninsured-motorist claim” before it had been determined in separate litigation whether the uninsured party was, in fact, liable for the plaintiff’s injuries. (Heneghan, 195 Ill. App. 3d at 453.) We concluded that the limitations period did not begin to run until the uninsured party was adjudged the responsible party in other proceedings. Heneghan, 195 Ill. App. 3d at 454.

Here, the plaintiff also seeks to establish in the personal injury action that the defendants in that suit are liable to him for the damages. Moreover, the plaintiff must determine whether the personal injury defendants’ insurance policy limits will be sufficient to cover his damages. In short, at this juncture there is simply no way to determine whether the defendants in the personal injury action are actually “underinsured” relative to the damages for which they are responsible. Accordingly, we believe that here, as in Heneghan, the limitations period begins to run only when this determination is made via settlement or judgment. Stated another way, there has not yet been an “occurrence of [a] loss” under the plaintiff’s policy, and so the period has not yet begun to run.

The defendant argues that Shelton v. Country Mutual Insurance Co. (1987), 161 Ill. App. 3d 652, compels us to reach a different conclusion. The facts in Shelton, however, differ from those in the instant case in two crucial aspects. First, the plaintiff in Shelton exhausted the liability bonds and coverage of the other parties 8 Vz months before the period of limitations had expired, so the insured could still have timely asserted a claim against the insurer. Second, the court noted that the policy at issue in Shelton specifically stated that “the limitations period begins to run on the date of the accident.” (Emphasis added.) (Shelton, 161 Ill. App. 3d at 657.) The court distinguished the case from Trust Co. v. Iroquois Auto Insurance Underwriters, Inc. (1936), 285 Ill. App. 317, wherein the limitations period at issue was triggered not by the occurrence of the accident, but by the “happening of the loss.” (Shelton, 161 Ill. App. 3d at 657.) The triggering language in Iroquois is also very similar to that in the case at bar. Thus, we believe that both Shelton and Iroquois implicitly support the result reached here.

We conclude that there has not been an occurrence of a loss under the plaintiff’s uninsured motorist coverage because the liability, and the sufficiency of policy coverage, of the personal injury defendants has not yet been determined in the other action. Accordingly, the limitations period has not yet begun to run against the plaintiff. Thus, we affirm the trial court’s entry of summary judgment in favor of the plaintiff on the portion of the complaint seeking declaratory relief.

We now must address the plaintiff’s separate appeal from the trial court’s denial of his petition for attorney fees pursuant to section 155 of the Code. Section 155 allows a trial court to assess attorney fees against an insurer whose refusal to settle a claim causes unreasonable and vexatious delay. (Ill. Rev. Stat. 1989, ch. 73, par. 767.) Where there is a bona fide dispute about coverage, however, delay in settling a claim may not violate the statute. (Mohr v. Dix Mutual County Fire Insurance Co. (1986), 143 Ill. App. 3d 989, 999.) The determination of whether an insurer’s delay is vexatious and unreasonable is a factual one committed to the sound discretion of the trial court; its determination will not be disturbed on review unless an abuse of discretion is demonstrated in the record. Dark v. United States Fidelity & Guaranty Co. (1988), 175 Ill. App. 3d 26, 30-31.

Here, we cannot say that it was an abuse of discretion for the trial court to conclude that the insurer’s refusal to settle the plaintiff’s claim did not constitute unreasonable or vexatious delay. Though we have arrived at an interpretation of the policy different from that advanced by the defendant, we believe it was reasonable for the trial court to conclude that the dispute over coverage was bona fide. We therefore affirm the trial court’s order refusing to award attorney fees to the plaintiff.

The judgment of the circuit court of Kane County is affirmed.

Affirmed.

WOODWARD and INGLIS, JJ., concur.


text:
      In re N.R.L., a Minor (The People of the State of Illinois, Petitioner-Appellee, v. N.R.L., Respondent-Appellant).
    Second District
    No. 2—88—1107
    Opinion filed July 18, 1990.


author: JUSTICE STOUDER

text:
    THE PEOPLE OF THE STATE OF ILLINOIS, Plaintiff-Appellee, v. C.A. DEVINE, Defendant-Appellant.
    Third District
    No. 3—89—0598
    Opinion filed July 13, 1990.

      Gregory L. Barnes, of Gregory L. Barnes, Ltd., of Decatur, for appellant.
    Robert D. Gaubas, of Robert D. Gaubas, Ltd., of Peoria (Terry A. Mertel, of State’s Attorneys Appellate Prosecutor’s Office, of counsel), for the People.
   JUSTICE STOUDER

delivered the opinion of the court:

Following a jury trial in the circuit court of Peoria County, the defendant, C.A. Devine, was found guilty of murder and sentenced to a term of 60 years’ imprisonment in the Department of Corrections. The defendant appeals.

On appeal, the defendant argues that the trial court erred: (1) by allowing the prosecution to present evidence of the defendant’s prior misdemeanor convictions, (2) in not granting a mistrial after a prosecution witness alluded to the defendant’s earlier trial, (3) by improperly allowing a prosecution witness to testify as to hearsay statements, and (4) by giving the defendant an excessive sentence.

The record reveals that on February 27, 1986, the defendant and Essie Morris, the victim, had a fight. Morris was the defendant’s live-in girlfriend. Morris died as a result of that fight. The defendant was charged with murder and was convicted. The defendant’s original conviction was reversed by this court in an unpublished decision No. 3— 86 — 0626 based on improper jury instructions. This is an appeal of the retrial.

At trial, Peoria city police officer Jack Baize testified that at approximately 7 p.m. on the date of the murder he was the first to arrive at the defendant’s residence. The defendant met Baize at the door. The defendant informed him that “a lady was in bed, and she would not wake up.” The defendant led Baize to the bedroom where Baize found the victim lying in bed, covered with clothes and with her arms folded. Baize took the victim’s vital signs and determined that she was dead. After examining the residence, Baize spoke with the defendant, who informed him that there had been a fight that evening. Baize then gave the defendant his Miranda warnings and turned the questioning over to Officer Pat Rabe, who had since arrived at the scene.

The defendant told Rabe that he and the victim argued over a gun the victim had allegedly stolen from the defendant’s friend “Frog” and that it “got deeper and deeper as the day went on.” The defendant told Rabe that the victim pointed the gun at him and said she was going to kill him. The defendant told Rabe that he took a broomstick and struck the victim in an attempt to defend himself. The defendant stated that he later went to see how the victim was doing and found her motionless in bed whereupon he called the police.

Dr. David Demick, the Peoria County coroner’s physician, testified regarding the autopsy he performed on the victim. Dr. Demick testified that the victim suffered a large bruise and deep laceration in the back of her head caused by a blow from the back. That blow to the head caused some hemorrhaging on the surface of the victim’s brain. The victim was also covered with a pair of bruises running parallel on her shoulders and buttocks. The bruises indicate that she was struck with a rod-like instrument. An ulcerated area on her buttocks established that a portion of her flesh had been tom away. Tiny splinters of wood were found in this ulcerated area. In addition, the kitchen garbage can contained pieces of a broken broomstick. Dr. Demick also noted that the victim had small lacerations in the whites of her eyes from constriction of the veins in her neck, consistent with strangulation.

According to Dr. Demick, the victim also suffered massive internal injuries. These injuries included three broken ribs, a bruised heart, and a liver that was broken apart. Dr. Demick stated that considerable force was necessary for these injuries, and he noted that the liver injury was of the type usually associated with an automobile accident. Dr. Demick also testified that the victim’s stomach and pancreas were bleeding and disrupted. Dr. Demick determined that the primary cause of death was manual strangulation. Dr. Demick came to this conclusion because he found the victim’s larynx fractured and the soft tissue surrounding the larynx to be hemorrhaging.

The prosecution also presented the testimony of Cassandra Tyler, the victim’s daughter. Tyler testified, over defense counsel’s objection, that she had observed her mother with a bruised lip in December of 1985 and that her mother said the defendant had struck her, causing the bruise.

The defendant testified that he and the victim had lived together since September 1985. He stated that he had seen the victim carrying a gun on occasion and that she became violent when on cocaine. He also commented that the victim had once shot at an old boyfriend.

With respect to the incident here, the defendant testified that in the morning the two talked about why the victim had allegedly robbed the defendant’s friend “Frog.” The victim told the defendant that she was going to kill the defendant. She then produced a gun and the two wrestled. The defendant eventually took the gun from the victim.

Thereafter, the victim somehow retrieved the gun a second time and threatened to kill the defendant. The defendant stated that they started fighting and he used a broom to get her away. When they stopped fighting, the victim went back to bed. After periodically checking on her condition, the defendant found the victim unresponsive. He then called the police.

In addition, as rebuttal evidence the prosecution offered, over the objection of defense counsel, certified copies of the defendant’s two prior misdemeanor battery convictions. The trial court admitted both convictions and published the same to the jury.

We first address the issue whether the trial court erred in admitting evidence of the defendant’s prior misdemeanor convictions for battery. The defendant argues that since both convictions are misdemeanors and do not involve dishonesty, they were improperly used for impeachment purposes under People v. Montgomery (1971), 47 Ill. 2d 510, 268 N.E.2d 695.

The supreme court in Montgomery was faced with the impeachment of a witness by evidence of a prior conviction. There, the court adopted proposed Federal Rule of Evidence 609: a prior misdemeanor not involving dishonesty or false statement may not be used to attack the credibility of a witness.

In the instant case, however, the defendant’s prior convictions were not introduced for general impeachment. Rather, the defendant’s prior convictions were used as refutational evidence to show his propensity to violence and therefrom infer that the defendant was the initial aggressor. The defendant’s reliance on Montgomery is, therefore, misplaced.

Subject to well-defined limitations, evidence regarding the character of a defendant or a victim is relevant and admissible. (R. Ruebner, Illinois Criminal Trial Evidence 34 (1986).) When a theory of self-defense is raised in a battery or homicide case, evidence of the peaceful or violent character of either party is relevant as circumstantial evidence to show whether the complainant or the accused was the initial aggressor. (People v. Randle (1986), 147 Ill. App. 3d 621, 498 N.E.2d 732.) However, while such character evidence is always relevant, it may not always be admissible. (People v. Randle (1986), 147 Ill. App. 3d 621, 498 N.E.2d 732.) Because of the inflammatory nature of such evidence, it must first be determined whether the danger of undue prejudice outweighs the relevance of the evidence. People v. Lynch (1984), 104 Ill. 2d 194, 470 N.E.2d 1018.

As the court in Randle noted:

“Under this balancing test, character evidence offered by the accused to show the complainant’s propensity to violence is admissible because the danger of undue prejudice to the accused lies in not admitting such evidence. [Citation.] On the other hand, similar character evidence offered by the prosecution to show the accused’s propensity to violence is generally inadmissible because the danger of unfair prejudice to the defendant in being portrayed as a ‘bad man’ substantially outweighs the probative value of the evidence. [Citation.] Such evidence of bad character may be introduced by the prosecution only if the defendant first opens the door by introducing evidence of good character to show that he is a quiet and peaceful person.” People v. Randle (1986), 147 Ill. App. 3d 621, 625, 498 N.E.2d 732, 736.

In the instant case, in support of his claim of self-defense, the defendant testified that the altercation between himself and the victim began when he argued with her over her alleged theft of money, cocaine, and a gun from the defendant’s friend “Frog.” The defendant testified that the victim usually carried a Derringer and that she allegedly told him that she once shot at an old boyfriend. The defendant further testified that the victim was high on cocaine on the night of this incident and that she was violent when on cocaine. The defendant also testified that he was a peaceful person. As a result of this testimony, the trial court later permitted the prosecution to introduce the defendant’s prior misdemeanor convictions for battery.

In addition, the defendant introduced evidence of the victim’s prior misdemeanor conviction for unlawful use of weapons and several other alleged acts of violence in order to establish that she had a violent character. The defendant hoped to establish that it would be more likely for the victim to be the aggressor because of her alleged violent character. By introducing this evidence, however, the defendant opened the door for the prosecution to introduce evidence of the defendant’s bad character. The only question relevant here is whether the prejudice to the defendant in introducing the prosecution’s evidence substantially outweighs the probative value of the evidence.

The prosecution may not initially introduce evidence of bad character against a defendant because it is feared that the jury will be swayed to convict based not on a defendant’s actual guilt of the offense charged, but because the defendant is a bad person. (People v. Randle (1986), 147 Ill. App. 3d 621, 498 N.E.2d 732.) However, where, as here, the defendant initially introduces evidence that the victim had a violent character and that he was a peaceful person, the interests of fairness require that the prosecution be allowed to rebut this portrayal by the defendant. Here, we find that the probative value from such character evidence outweighs any prejudice to the defendant, and, therefore, we hold that the trial court did not err in admitting the defendant’s prior misdemeanor convictions.

The defendant next argues that the trial court erred in denying the defense motion for a mistrial made after a prosecution witness alluded to the defendant’s earlier trial on this charge. The remark complained of came during Dr. Demick’s testimony. Dr. Demick performed an autopsy on the victim and testified for the prosecution at the first trial in 1986. During the first trial, Dr. Demick used and testified from a human form chart. Dr. Demick used the same chart at the second trial. Asked to identify the chart at the second trial, Dr. Demick replied that “this is the chart I marked myself with red ink during the last trial of this defendant.” The defense counsel requested a sidebar and, outside the jury’s presence, moved for a mistrial. The trial court denied the motion. The trial court found that the prosecution had not intended to elicit that particular response from the witness. The trial court also suggested that the jury might not have heard the witness. The trial court then instructed the jury to disregard the witness’ statement “during the last trial of this defendant.”

The defendant in the instant case contends that the prejudicial effect of the statement continued throughout the trial. The defendant suggests that the jury could reasonably conclude that the defendant had been tried on this charge before resulting in a conviction with a reversal (as actually happened) or a jury was unable to reach a verdict resulting in a mistrial.

The prosecution counters by citing People v. Jones (1988), 123 Ill. 2d 387, 528 N.E.2d 648, wherein the Illinois Supreme Court was confronted with a similar issue. In Jones, a prosecution witness called to testify concerning the chain of custody was asked when she had seen certain tubes of blood. The witness answered “Just at the last trial.” (123 Ill. 2d at 408.) The trial court, there, refused the defense motion for a mistrial and instructed the jury to disregard the comment. The supreme court, in affirming the trial court, noted that the jurors did not learn of the outcome of the earlier trial and were not told the identities of the parties at the earlier trial. Moreover, the supreme court emphasized that the trial court admonished the jurors to disregard the witness’ answer. People v. Jones (1988), 123 Ill. 2d 387, 408, 528 N.E.2d 648, 658.

Similarly, in the instant case, the jurors did not learn the outcome of the earlier trial and the trial court admonished them to disregard the witness’ answer. Based on Jones, therefore, we conclude that the brief reference to the earlier trial did not prejudice the defendant or otherwise impair his right to a fair trial. People v. Jones (1988), 123 Ill. 2d 387, 528 N.E.2d 648.

The defendant next argues that the trial court erred in permitting the victim’s daughter to testify that she observed her mother with a bruised lip in December of 1985, and that the victim told her that the defendant struck her. Generally, evidence of the commission of other crimes by an accused, in addition to that for which he is on trial, is inadmissible unless its relevancy in placing a defendant in proximity to the time and place, aiding or establishing identity, or tending to prove design, motive or knowledge is so closely connected with the main issue as to justify admission. (People v. Gage (1966), 34 Ill. 2d 530, 216 N.E.2d 805.) In the instant case, the evidence presented of the defendant’s alleged prior striking of the victim two months before her death has no relevancy to proximity to time and place, does not go to identity and does not constitute evidence to prove design, plan, or motive. Furthermore, the evidence constitutes hearsay without an applicable exception. We find, therefore, that the trial court erred in admitting this evidence.

Our review of the record, however, indicates that the admission of this evidence, while erroneous, was also harmless. Testimony relating to other offenses does not per se constitute grounds for reversal. (People v. Wallace (1983), 114 Ill. App. 3d 242, 448 N.E.2d 910.) Where every element of the crime charged has been established by properly admitted evidence and that evidence is so overwhelming that there is no reasonable probability that the defendant would have been acquitted if the inadmissible evidence had been excluded, the error is harmless. People v. Wadley (1988), 169 Ill. App. 3d 1036, 523 N.E.2d 1249.

In the instant case, the defendant admitted that he struck the victim. The defendant argues, however, that he was merely acting in self-defense. The evidence presented indicates that the victim was struck repeatedly and killed in a savage manner. The extent of the victim’s injuries was so great that no reasonable juror could have found them to be inflicted by a person acting in self-defense. Therefore, it is extremely unlikely that the jury would have acquitted the defendant had the testimony been omitted from the trial. Accordingly, we find this evidence did not so prejudice the defendant as to deny him a fair trial.

The defendant finally argues that the trial court abused its discretion in sentencing him to a 60-year term of imprisonment. The trial court based its decision on the particularly brutal and heinous circumstances surrounding the victim’s murder. As detailed earlier, the offense committed here was accompanied by exceptionally brutal and heinous behavior. (See Ill. Rev. Stat. 1989, ch. 38, par. 1005—5—3.2(b)(2).) We, therefore, cannot conclude that the trial court abused its discretion in imposing the sentence. People v. Perruquet (1977), 68 Ill. 2d 149, 368 N.E.2d 882.

For these reasons the judgment of the circuit court of Peoria County is affirmed.

Affirmed.

HEIPLE, P.J., and GORMAN, J., concur.


text:
    UNION FEDERAL SAVINGS AND LOAN ASSOCIATION, Plaintiff-Appellant, v. CHAMPION FEDERAL SAVINGS AND LOAN ASSOCIATION, f/k/a Bloomington Federal Savings and Loan Association, Defendant-Appellee.
    Third District
    No. 3—89—0531
    Opinion filed July 13, 1990.

      Grayce K. Rund and Christopher R. Smith, both of Burke & Smith, Chartered, of Chicago (Raymond J. Smith, of counsel), for appellant.
    John V. Patton and Robert J. Noe, both of Bozeman, Neighbour, Patton & Noe, of Moline, and Michael L. Brody and Jonathan H. Margolies, both of Schiff, Hardin & Waite, of Chicago (Barry S. Alberts, of counsel), for appellee.
   JUSTICE STOUDER

delivered the opinion of the court:

The plaintiff, Union Federal Savings and Loan Association, appeals from the judgment of the circuit court of Rock Island County which dismissed Union Federal’s complaint against the defendant, Champion Federal Savings and Loan Association. The circuit court held that Union Federal’s action was barred by the applicable statute of limitations and collateral estoppel.

In 1981, Rock Island Savings and Loan Association was experiencing financial difficulties and approached Union Federal to determine Union Federal’s interest in a possible merger of the two institutions. A series of discussions was held in the winter and early spring of 1982. On April 12, 1982, the Rock Island board of directors’ executive committee unanimously approved the merger agreement and informed Union Federal that they would recommend the merger to the full board the next day.

However, on the morning of April 13, 1982, Rock Island was contacted by Champion Federal, which expressed its interest in a possible merger. That afternoon the Rock Island board of directors rejected Union Federal’s merger proposal.

Union Federal filed an action against Champion Federal in the circuit court of Rock Island County on November 12, 1982, alleging that Champion Federal tortiously interfered with an economic expectancy. Union Federal amended its complaint in 1983 alleging that Champion Federal’s actions also constituted a violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (Ill. Rev. Stat. 1989, ch. 121½, par. 261 et seq.). On April 11, 1986, Union Federal filed a complaint against Champion Federal in the United States District Court for the Central District of Illinois. The complaint alleged violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) (18 U.S.C. §1961 et seq. (1988)). It also repeated the claims brought in the State court. On May 5, 1986, Union Federal’s State court action was voluntarily dismissed without prejudice.

On May 5, 1988, the district court granted Champion Federal's motion for summary judgment on the RICO claims and declined jurisdiction over the pendent State-law counts. In granting summary judgment, the district court stated in pertinent part:

“For these reasons, the Court concludes that Union Federal has failed to allege a cognizable injury under RICO. The evidence shows that Champion’s alleged criminal conduct was not ‘causally related’ to the Rock Island Board’s decision to reject Union Federal’s merger proposal. The reason that the Rock Island Board refused Union Federal’s merger proposal were reasons solely related to Union Federal’s merger conduct and terms of the proposal. Therefore, this court finds that Union Federal’s RICO claim is fatally defective in that it fails to allege a cognizable injury.”

Union Federal refiled its State-law claims in the circuit court on February 1, 1989. Champion Federal filed a motion to dismiss the complaint contending the action was barred by the statute of limitations and collateral estoppel. The circuit court granted Champion Federal’s motion on both grounds.

On appeal, Union Federal contends the circuit court erred in finding that Union Federal was collaterally estopped from pursuing its State-law claims, and that its action was also barred by the statute of limitations.

Collateral estoppel is an equitable doctrine founded on principles of judicial economy intended to prevent relitigation of previously adjudicated claims. (National Commercial Banking Corp. of Australia, Ltd. v. Harris (1988), 125 Ill. 2d 448, 532 N.E.2d 812.) The doctrine of collateral estoppel applies when a party or someone in privity with a party participates in two separate and consecutive cases arising on different causes of action and some controlling fact or question material to the determination of both cases has been adjudicated against that party in the former suit by a court of competent jurisdiction. (Housing Authority v. Young Men’s Christian Association (1984), 101 Ill. 2d 246, 461 N.E.2d 959.) The adjudication of the fact or question in the first cause will, if properly presented, be conclusive of the same question in the later suit, but the judgment in the first suit operates as an estoppel only as to the point or question actually litigated and determined and not as to other matters which might have been litigated and determined. (Telegraph Savings & Loan Association v. Schilling (1984), 105 Ill. 2d 166, 473 N.E.2d 921.) The only pertinent questions for the utilization of collateral estoppel are: (1) whether the issue decided in the prior adjudication is identical with the one presented in the case in question; (2) whether there has been a final judgment on the merits; and (3) whether the party against whom estoppel is asserted is a party or in privity with a party to the prior adjudication. Ballweg v. City of Springfield (1986), 114 Ill. 2d 107, 499 N.E.2d 1373.

In the instant case, the parties to the Federal and the State court actions were the same, and the grant of summary judgment in the district court constituted a judgment on the merits. (See Poulos v. Reda (1987), 165 Ill. App. 3d 793, 801, 520 N.E.2d 816 (“Summary judgment *** is the procedural equivalent of a trial and is an adjudication of the claim on the merits”).) The only question is whether the issue determined in the prior adjudication is the same issue as presented in the instant case. The district court found the sole cause of Rock Island’s rejection of Union Federal’s merger proposal was Union Federal’s conduct and the terms of the proposal and that therefore Union Federal had no cause of action under RICO. Union Federal argues that the causation issue in the State-law claims is not identical to the causation issue decided by the district court in the RICO action.

Union Federal cites Telegraph Savings & Loan Association v. Schilling (1984), 105 Ill. 2d 166, 473 N.E.2d 921, as resolving the issue in its favor. The case, however, is distinguishable. In Telegraph Savings, the Commissioner of Savings and Loans for the State of Illinois closed Telegraph Savings without advance written notice, finding an “emergency” situation existed. The Federal Home Loan Bank Board appointed the Federal Savings and Loan Insurance Corporation (FSLIC) as receiver of Telegraph Savings and immediately transferred its assets to another savings and loan. Telegraph Savings filed suit in Federal and State court. In the Federal action the appointment of the FSLIC as receiver was upheld. In the State court action, the Commissioner claimed that based on the Federal court’s finding upholding the appointment of a receiver, Telegraph Savings was collaterally estopped from challenging the Commissioner’s actions. The issue was whether Telegraph Savings was entitled to a State court determination of the State-law “emergency” issue. The Illinois Supreme Court held (three justices dissenting) that Telegraph Savings’ State-law claims were not barred by collateral estoppel. The court agreed with the view of the Federal district court and the Court of Appeals that Telegraph Savings’ State-law claims were distinct from its challenge of Federal receivership.

In the instant case, the causation issue is the same in both the State and Federal actions. The district court found that the cause of Rock Island’s rejection of Union Federal’s proposal was not related to the activity of Champion Federal, but was caused by the actions of Union Federal itself. This finding precludes Union Federal from relitigating the issue of what caused Rock Island to reject Union Federal’s merger proposal. We find no merit to Union Federáis attempt to distinguish the causational element in the State-law claims from the causational element determined by the district court. Therefore the circuit court was correct in holding that Union Federal’s State-law claims were barred by collateral estoppel.

Since we find Union Federal’s action was properly dismissed on the grounds of collateral estoppel, we need not address the statute of limitations issue.

For the foregoing reasons, the judgment of the circuit court of Rock Island County is affirmed.

Affirmed.

SCOTT and GORMAN, JJ., concur.