Appellate Court Considers Question Not Raised By Either Insurer In Automobile Coverage Dispute

While driving his Chevy, Brian Berry hit Lisa Villarreal. Founders Insurance had issued automobile insurance that covered Berry ‘s Chevy. Berry also had an insurance policy with Mid-Century Insurance. Berry thought the Mid-Century policy covered his Dodge. But the policy listed the Chevy as the covered vehicle.

Villareal, who was injured in the accident, sued Berry. Founders settled that case on Berry’s behalf, and paid Villareal $100,000. Founders then found itself in a lawsuit with Mid-Century over which company had to pay the $100,000. Both Founders and Mid-Century asked the trial court for summary judgment. The trial court gave Founders summary judgment, and ruled that Mid-Century owed half the settlement paid to Villareal as equitable contribution.

Mid-Century appealed the ruling. Mid-Century raised two issues in the appellate court that focused on whether there was compliance the Mid-Century policy. Founders responded to those arguments. But the First District Illinois Appellate Court ruled there was a threshold issue that neither insurer raised in the trial or appellate courts: whether the Mid-Century policy even covered the Chevy.

So the initial question was whether the appellate court could or should consider that basic question, which neither insurer briefed or argued. Relying on the general powers the appellate court has under Illinois Supreme Court Rule 366, the appellate court ruled that it could consider the question to reach a fair result. This is how the court explained it:

Although the parties did not address this threshold issue of coverage in the trial court and both parties proceed before us under the assumption that the two policies provided overlapping insurance coverage, it is within our discretion to address this possibly dispositive issue …

While generally issues not raised at the circuit court level are considered waived, “a reviewing court does not lack authority to address unbriefed issues and may do so * * * when a clear and obvious error exists in the trial court proceedings.”… ” ‘[U]nder [Illinois Supreme Court] Rule 366 … a reviewing court may, in the exercise of its responsibility for a just result, ignore consideration of waiver and decide a case on grounds not properly raised or not raised at all by the parties.’ ” … In choosing to address an unbriefed issue, we recognize that as a reviewing court, we must refrain from doing so if the effect would be to transform us from jurist to advocate … That is not our intention here.

In the end, the appellate court ruled that Mid-Century’s policy did not insure the Chevy, so Founder’s summary judgment was reversed, and Mid-Century did not owe anything toward Berry’s settlement with Villareal. Read the whole opinion, Mid-Century Insurance v. Founders Insurance, No. 1-09-1858 (9/24/10), by clicking here.