by Brett KruckmeyerInsurer loses bid to limit costs in collision involving rental car
By Stephanie Potter Law Bulletin staff writer
The 1st District Appellate Court decided Friday that a rental car company was not required to provide liability cov- erage to customers who prefer to use their own coverage.
The ruling, written by Justice P. Scott Neville Jr., affirmed a decision by Cook County Circuit Judge John K. Madden, who has since retired.
The case arose out of an Oct. 25, 2000, auto accident between Allstate Insurance Co. policy- holder Rajiv Munschi and Gary Vitt, who was driving a rental car owned by Hertz Corp., the deci- sion said. Munschi settled with Vitt for $20,000, but did not pursue a claim against Hertz.
Allstate then filed an action for declaratory judgment to determine its liability under the underinsured motorist provision of its policy with Munschi.
Allstate sought to limit the amount it would have to pay Munschi under his underinsured motorist policy to its coverage limit of $100,000, minus the $20,000 Munschi received from Vitt and the $50,000 to which it argued Munschi might have been entitled had he sued Hertz.
At the very least, said Allstate attorney Peter C. Morse, Hertz should have been required to provide $30,000 in coverage, for a total of $50,000 when Vitt’s other coverage was factored in.
Hertz is required under the law to maintain coverage of $50,000 per person or $100,000 per accident in liability protect for its renters, the decision said. But in offering customers that insurance, Hertz also states that it will not indemnify customers who rely on their own insurance as long as the policies meet minimum state requirements, the decision said.
According to the decision, Vitt
rented the Hertz car on Oct. 3, 2000, and declined to purchase the liability insurance offered by Hertz. He opted to rely on his policy from Geico Insurance, which had coverage of $20,000 per person or $40,000 per acci- dent for personal injury or death, the minimum required under Illinois law.
In Allstate’s declaratory judg- ment action, Madden granted summary judgment in favor of Munschi.
Agreeing with Madden’s deci- sion that Munschi was entitled to $80,000 worth of coverage, Neville cited Hertz’s liability insurance supplement provision, which states that the company’s liability will be triggered only if the renter does not have the minimum insurance required under the law.
Allstate based its argument on the Illinois law concerning underinsured motorists, 215 ILCS 5/143a-2(4). The law states that the liability limits “for an insurer providing underinsured motorist coverage shall be the limits of such coverage, less those amounts actually recov- ered under the applicable bodily injury insurance policies, bonds or other security maintained on the underinsured motor vehicle.”
Allstate argued that Hertz’s $50,000 in self-insurance should be considered “other security,” Neville said.
But the court rejected that argument, relying on Fogel v. Enterprise Leasing Co. of Chicago, 353 Ill.App.3d 165, 176 (2004), citing Farm Bureau Mutual Insurance Co. v. Alamo Rent A Car, 319 Ill.App.3d 382, 389 (2000). Those cases hold that the parties to a rental agree- ment can contract as to which insurer, the rental agency or the renter’s own insurance, is responsible for primary cover-
age, as long as the state’s minimum requirements are met, Neville wrote.
“Finally, and most impor- tantly, the UIM statute pro- vides that the insurer (Allstate) providing underinsured motorist coverage is limited to a deduction of the ‘amounts actually recovered’ from the insurance policy on the under- insured motor vehicle,” Neville wrote.
Morse, who said he was disap- pointed with the decision, said he did not know whether Allstate would appeal. He called the issue of the definition of “other secu- rity” a minor part of the case. The real issue, he said, is that rental car companies should be held to the requirement of main- taining coverage for its renters of $50,000 per person or $100,000 per accident.
“They don’t seem to want to hold the rental car company’s feet to the statutory fire,” Morse said.
In requiring Allstate to provide $80,000 worth of cover- age. Neville said Illinois law has established that the intent of the underinsured motor vehicle law is to leave the insured in the same position he or she would have been if the other driver had adequate insurance, citing Susler v. County Mutual Insurance, 147 Ill. 2d 548, 555 (1992).
Justices Michael J. Gallagher and Sheila M. O’Brien concurred in the decision, which was unpublished under Supreme Court Rule 23.
Allstate was represented by Morse and Jeffrey A. Siderius of Morse & Bolduc. Munschi was represented by Christopher M. Norem of Parente & Norem P.C. He could not be reached for comment.
The case is Allstate Insurance Co. v. Rajiv Munschi, No. 1-04- 1919.
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CHICAGOLAWBULLETIN.COM // In the News
Volume 151, No. 197 // FRIDAY, OCTOBER 7, 2005
by Brett KruckmeyerMan fractured spine when a school bus ran over a pothole
Chicago Daily Law Bulletin // In Circuit Court
A Chicago man with a brittle bone disease whose spine was fractured when a school bus ran over a pothole has settled his lawsuit against the bus company for $1.9 million.
Rocky Eljubeh, who suffers from Torg’s Osteolysis, claimed that the Chicago School Transit bus company should have out- fitted their special needs bus more carefully and should have trained its drivers to recognize road hazards better.
Eljubeh and the bus company came to terms Wednesday and Cook County Circuit Judge Bill Taylor formally dismissed the suit Friday. Under terms of the settlement, Chicago School Transit will put the $1.9 million into an compound-interest- bearing annuity, which will pay Eljubeh more than $8 million over 56 years.
Eljubeh was 14 and on his way to Jesse Spaulding High School on Jan. 10, 2000, when the bus was rattled. He suffered compression fractures on his lumbar spine.
He was represented by Joseph D. Parente and Christopher M. Norem of Parente & Norem P.C.
The case was mediated by retired Cook County circuit judge Anthony John Bosco of LaRose & Bosco Ltd.
Craig A. Tomassi of The Law Offices of Craig Tomassi defended Chicago School Transit.
Tomassi said that he thought the settlement “was very fair to both sides.” Eljubeh was “severely injured” in the accident and would have made “a very sympathetic witness” at trial, Tomassi said.
The case was Rocky Eljubeh, et al. v. Chicago School Transit, No. 00 L 3867.
Copyright (c) 2014 Law Bulletin Publishing Company. All rights reserved. Reprinted with permission from Law Bulletin Publishing Company.
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CHICAGOLAWBULLETIN.COM // In the News
FRIDAY, JUNE 3, 2005 // Volume 151, No. 109
by Brett KruckmeyerConstruction worker falls from overhang
Chicago Daily Law Bulletin // In Circuit Court
A construction worker who fell from an overhang covering a concrete stairwell reached a $1.1 million settlement with the general contractor on the project. The plaintiff, whose right foot was severely injured as a result of the fall, was an employee of a siding subcontractor that had been enlisted by the general contractor to do rough framing work on a residence.
The plaintiff was represented by Joseph D. Parente and Christopher M. Norem of Parente & Norem P.C. Co-defendants David Beechy and By-The-Book Construction were repre- sented by Larry Schectman and Rita Filiaggi of O’Hagan, Smith & Amundsen LLC, and Jon Yambert of Chilton, Yambert, Porter & Coghlan, respectively. The case was settled on Friday before Cook County Circuit Court Judge Richard J. Elrod. Mark Anderson v. David Beechy and By-The-Book Construction Inc., No. 00 L 004344.
Copyright (c) 2014 Law Bulletin Publishing Company. All rights reserved. Reprinted with permission from Law Bulletin Publishing Company.
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CHICAGOLAWBULLETIN.COM // In the News
TUESDAY, AUGUST 5, 2003 // Volume 149, No. 152
by Brett KruckmeyerWoman suffered head injuries when she fell on a concrete stairwell
Chicago Daily Law Bulletin // In Circuit Court
A woman who suffered head injuries when she fell on a concrete stairwell has reached a $2.5 million settlement with the owner of the building.
On June 16, 1999, Barbara Everett fell in what she claimed was an unlit, garbage-strewn stairwell at her apartment build- ing on the South Side. She sustained a head injury and underwent surgery at Cook County Hospital.
Cook County Circuit Judge Irwin J. Solganick approved the settlement Monday after a week of trial, in which facts such as the condition of the stairwell and the effects of the fall were disputed.
Joseph D. Parente, Christopher M. Norem and Randall W. Schwartz of Parente & Norem represented Everett. Mitchell H. Frazen of Litchfield, Cavo represented the building owner.
The case is Barbara Everett v. South Lowe Ave. Terrace LLC, No. 99 L 13249.
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CHICAGOLAWBULLETIN.COM // In the News
Volume 149, No. 49 // WEDNESDAY, MARCH 12, 2003
by Brett KruckmeyerVehicle rear-ended by a truck
Chicago Daily Law Bulletin // In Circuit Court
A $3 million settlement stemming from a 1997 Arlington Heights auto accident was approved Wednesday by Cook County Circuit Judge Susan G. Fleming.
Javaid Malik was traveling westbound on West Higgins Road, when the vehicle in which he was a passenger was rear-ended by a Jack Gray Transport truck. As a result of the accident, Malik underwent double-level cervical fusion surgery, which aggravated his preexisting condition of degenerative disk disease, said plaintiff attorney Christopher M. Norem. Javaid Avan Malik, et al. v. Jack Gray Transport Inc., et al., No. 97 L 0867.
The defense was represented by Martin D. Synder, an attor- ney in Williams, Montgomery & John.
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CHICAGOLAWBULLETIN.COM // In the News
Volume 147, No. 97 // WEDNESDAY, MAY 16, 2001