Allstate Insurance Comapny v. Mack

2016 IL App (1st) 141171-U

No. 1-14-1171

NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent
by any party except in the limited circumstances allowed under Rule 23(e)(1).

FIFTH DIVISION
June 30, 2016

IN THE APPELLATE COURT OF ILLINOIS
FIRST JUDICIAL DISTRICT

ALLSTATE INSURANCE COMPANY, ) Appeal from the
) Circuit Court of
Plaintiff-Appellee, ) Cook County.
)
v. ) No. 11 CH 38827
)
) The Honorables
VANITY MACK, ) Kathy Flanagan and
) John C. Griffin,
Defendant-Appellant. ) Judges Presiding.

JUSTICE LAMPKIN delivered the judgment of the court.
Presiding Justice Reyes and Justice Gordon concurred in the judgment.

ORDER

&1 HELD: Defendant’s arbitration demand did not permit her to ignore the terms of her

underinsured motorist insurance policy by failing to comply with plaintiff’s discovery requests.

&2 Defendant, Vanity Mack, appeals a number of circuit court orders, which ultimately

barred an underinsured motorist (UIM) claim she had initiated against plaintiff, Allstate

Insurance Company. Plaintiff filed the underlying declaratory judgment in the circuit court,

seeking a declaration that defendant breached the parties’ contract by refusing to provide
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executed HIPAA authorization forms and to submit to an oral examination under oath. The

circuit court granted summary judgment in favor of plaintiff and against defendant, and denied

defendant’s requests for reconsideration of those decisions. On appeal, defendant contends that

the rules of the American Arbitration Act (AAA) precluded her from complying with plaintiff’s

discovery requests because she already had demanded arbitration proceedings. Based on the

following, we affirm.

&3 FACTS

&4 On October 26, 2010, defendant submitted a UIM claim to plaintiff and also filed a

demand for arbitration with the AAA. In response, on December 7, 2010, plaintiff advised

defendant to provide executed HIPAA authorizations and to appear for an oral examination

under oath pursuant to the terms of the parties’ insurance policy. Defendant concedes that she

failed to comply with plaintiff’s requests and additionally concedes that she failed to comply

with plaintiff’s subsequent repeated requests to do so. In its subsequent declaratory judgment

action, plaintiff alleged defendant breached the parties’ insurance contract where she failed to

comply with the terms of the policy and, therefore, was barred from pursuing her UIM claim. In

response, defendant filed a motion to dismiss, which was denied, and later filed a motion for

summary judgment--both times arguing that the rules of the AAA regarding discovery

superseded the requirements of her insurance policy; therefore, she was under no obligation to

comply with plaintiff’s discovery requests. Defendant’s motion for summary judgment was

denied, as was her motion to reconsider that finding. Plaintiff then filed a motion for summary

judgment. The circuit court granted plaintiff’s motion for summary judgment and denied

defendant’s motion to reconsider that finding. Defendant timely appealed.

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&5 ANALYSIS

&6 On appeal, defendant maintains that the rules of the AAA governed the adjudication of

the underlying insurance claim once she requested arbitration. More specifically, defendant

argues that, because she simultaneously instituted arbitration proceedings when she submitted

her UIM claim, only the arbitrator had the authority to order discovery pursuant to the AAA

rules, not plaintiff. Defendant, therefore, insists that she was not obligated to comply with

plaintiff’s discovery requests. However, contrary to defendant’s argument, the issue on appeal is

not a discovery dispute per se. Rather, the issue is whether defendant was in breach of the

parties’ contract by failing to accommodate plaintiff’s requests to provide executed HIPAA

authorizations and to appear for an examination under oath.

&7 Summary judgment is proper and should be granted “without delay if the pleadings,

depositions, and admissions on file, together with the affidavits, if any, show that there is no

genuine issue as to any material fact and that the moving party is entitled to a judgment as a

matter of law.” 735 ILCS 5/2-1005(c) (West 2010). When the parties filed cross-motions for

summary judgment, they conceded that there were no genuine issues of material fact and invited

the court to decide the questions presented as a matter of law. American Family Mutual

Insurance Co. v. Niebuhr, 369 Ill. App. 3d 517, 522 (2006). We review an order granting

summary judgment de novo. Bohner v. Ace American Insurance Co., 359 Ill. App. 3d 621, 623

(2005). A circuit court’s finding on a motion to reconsider is reviewed for an abuse of

discretion. General Motors Acceptance Corp. v. Stoval, 374 Ill. App. 3d 1064, 1078 (2007).

“The construction of an insurance policy and a determination of the rights and

obligations thereunder are questions of law for the court and, thus, are appropriate

subjects for disposition by way of summary judgment. [Citation.] In construing an

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insurance policy, the primary function of the court is to ascertain and enforce the

intentions of the parties as expressed in the agreement. [Citation.] To ascertain the intent

of the parties and the meaning of the words used in the insurance policy, the court must

construe the policy as a whole, taking into account the type of insurance for which the

parties have contracted, the risks undertaken and purchased, the subject matter that is

insured, and the purposes of the entire contract.

If the words in the policy are clear and unambiguous, the court will afford them

their plain, ordinary meaning and will apply them as written.” Id.

&8 We find the terms of the insurance policy at issue here were clear and unambiguous.

Under the section dedicated to uninsured motorists’ insurance coverage, the parties’ policy stated

the following:

“Proof of Claim; Medical Reports

As soon as possible, any person making [a] claim must give us written proof of

[the] claim. It must include all details we may need to determine the amounts payable.

We may also require any person making [a] claim to submit to [an] examination under

oath and sign the transcript.

The insured person may be required to take medical examinations by physicians

we choose, as often as we reasonably require. We must be given authorization to obtain

medical reports and copies of records.” (Emphasis in original.)

Therefore, according to the plain policy language, in order to make a UIM claim, defendant was

required to provide written proof of the claim with “all details [plaintiff] may need to determine

the amounts payable.” This included executing a non-optional authorization to obtain medical

reports and copies of records, along with possibly having to submit to an oral examination under

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oath. As expressly provided by the insurance policy, plaintiff instructed defendant that, in order

to review her UIM claim, it needed executed HIPAA authorizations, as well as for her to submit

to an oral examination under oath. Plaintiff’s requests clearly were supported by the plain

language of the proof of claim notice provided in the insurance policy. Defendant concedes that

she failed to comply with plaintiff’s requests and, therefore, breached the terms of the parties’

insurance policy. As a result, defendant was not entitled to pursue her UIM claim. We,

therefore, find plaintiff was entitled to summary judgment.

&9 We acknowledge that the insurance policy also contained a section titled “If We Cannot

Agree.” The section provided, in relevant part:

“If the insured person or we don’t agree on that person’s right to receive any

damages or the amount, then upon the written request of either, the disagreement will be

settled by arbitration. Arbitration will take place under the rules of the American

Arbitration Association unless the insured person or we object.” (Emphasis in original.)

Based on its plain language, the arbitration section presumes the parties were unable to come to

an agreement prior to instituting the arbitration process. There was no such disagreement here.

In fact, review of the UIM claim had not yet been completed because defendant failed to comply

with the terms of claim submission. Where plaintiff had not yet presented a finding as to

defendant’s rights to receive any damages or an amount, there was no disagreement upon which

to institute arbitration proceedings. We, therefore, find that the AAA rules did not prohibit

compliance with the terms of the insurance policy.

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&10 CONCLUSION

&11 In sum, we conclude the circuit court properly denied summary judgment against

defendant and granted summary judgment in favor of plaintiff. We, therefore, find the circuit

court did not abuse its discretion in denying defendant’s motions to reconsider those findings.

&12 Affirmed.