May 2015 Case Notes & Comments

"Start by doing what's necessary; then do what's possible; and suddenly you are doing the impossible." ~ Francis of Assisi

MONTHLY QUIZ: Patient is admitted to Hospital and undergoes surgery. During her hospitalization, Patient experiences numerous complications and her internist orders two CT scans. Radiologist reads and interprets the two CT scans, but does not identify certain findings, which may have caused or contributed to Patient's death. Approximately 3 years after her death, Estate sends Patient's records to a medical Expert, who opines that Radiologist was negligent. Patient's Estate files wrongful death and survival actions against Radiologist claiming that the Estate had no knowledge that Radiologist was negligent until Expert reviewed the CT scans. Radiologist moves to dismiss on the ground that the two-year statutes of limitations for both wrongful death and survival actions have expired. Estate argues that the discovery rule tolled the wrongful death and survival actions. Who is correct? Should the Court allow the claims to continue? You be the judge. (Answer below)

WORKERS' COMPENSATION - IL SUPREME COURT ISSUE OF FIRST IMPRESSION REGARDING SECTION 19(F)(2) OF THE ACT: Section 19(f)(2) of the Workers' Compensation Act (820 ILCS 305/1 et seq., the Act) generally requires any person or entity challenging the Commission's decision regarding an award for the payment of money to file an appeal bond.  In many cases, the failure to file an appeal bond specified by section 19(f)(2) is a jurisdictional barrier which precludes Illinois courts from entertaining an appeal. While the Act does enumerate various entities (e.g. counties, cities, towns, townships, incorporated villages, school districts, etc.) which are exempt from the bond requirement, neither the Illinois State Treasurer (Treasurer) nor the Injured Workers' Benefit Fund (Fund) are mentioned. Treasurer, as custodian of the Fund, appealed an award against the Fund and in favor of Worker without filing the requisite appeal bond. Worker moved to dismiss the appeal on the grounds that the Illinois courts had no jurisdiction. On rehearing, the Appellate Court agreed. On further review, the Illinois Supreme Court considered and rejected Treasurer's argument that legislature never intended the bond filing requirements in section 19(f)(2) to apply to the State Treasurer. Finding section 19(f)(2) clear and unambiguous, the high court held that because Treasurer failed to post the bond, the courts did not have the "special statutory jurisdiction" required to entertain Treasurer's appeal. Illinois State Treas. v. Illinois Workers' Comp. Comm'n, et al., 2015 IL 117418 (Apr. 16, 2015)

SUMMARY JUDGMENT / ALLEGED VEXATIOUS & UNREASONABLE CLAIMS HANDLING: Defendant / Counter-Plaintiff's decedent and her 19 month old son were involved in a car accident, though it was unclear whether it was a single-car accident due to a blown-out tire or faulty brakes, or the result of a hit-and-run involving an unidentified vehicle.  Initially, Defendant made a claim to Insurer based on a claim of hit-and-run. In response, Insurer filed a declaratory judgment action seeking a finding that Insurer owed no duties as to the accident, on the basis that there was no competent evidence that there was physical contact between the subject vehicle and the hit-and-run vehicle.  Defendant, in turn, filed a counterclaim seeking attorney's fees and costs under section 155 of the Illinois Insurance Code (215 ILCS 5/155) for handling the claim in a vexatious and unreasonable manner.  Insurer moved for summary judgment on the counterclaim, arguing that the evidence it had received as a result of the investigation created a bona fide dispute as to whether the accident was a single-car collision or a hit-and-run accident involving a second car.  The trial court granted Insurer's motion for summary judgment, finding that it had a bona fide case to contest the hit-and-run claim.  While the Appellate Court affirmed, the court pointed out that the issue was not whether Insurer had some evidence of a hit-and-run accident, but whether Insurer had a real, genuine basis for disputing the hit-and-run scenario.  The Court concluded that, while there was evidence suggesting a hit-and-run, there was also evidence disputing the hit-and-run theory.  Accordingly, there was a reasonable, bona fide dispute as to the claim as a matter of law, and the motion for summary judgment in favor of Insurer on the  Section 155 claim for attorney's fees and costs was properly granted. Illinois Founders Ins. Co. v. Williams, 2015 IL App (1st) 122481 (Apr. 16, 2015)

Plaintiff, an Employee of Hospital, alleged that Hospital orally promised to provide security and escorts to their vehicles because employees were only allowed to park in a dangerous area, away from the Hospital's campus. Unable to locate Hospital security, Employee walked alone several blocks away to her vehicle, but was beaten and raped by an unknown individual. Employee filed a Complaint against Hospital for negligence and breach of contract. Hospital filed a motion to dismiss supported by the affidavit of Hospital's safety director, stating that employees were to use telephones to request transport to their vehicles, and that Employee had not done so on the night of the attack. Employee's response included a counter-affidavit stating that she was specifically told by Hospital not to use a phone to request security. In reversing the trial court's dismissal, the appellate court held that the Employee's counter-affidavit raised questions of material fact as to the scope of Hospital's voluntary undertaking to provide security, and the terms of the oral contract between the Hospital and Employee. Therefore, dismissal of the contract and negligence counts based on that evidence was inappropriate. Doe v. Univ. of Chicago Med. Ctr., 2015 IL App (1st) 133735 (Apr. 16, 2015)

Insured Oil Company owned and operated pipelines and refineries throughout the United States. As a result of its activities, Company was sued in numerous lawsuits, ranging from property damage and personal injury to regulatory matters alleging environmental contamination. Company tendered the defense of the suits to both its primary and excess insurers. Excess Insurer declined Company's tender on the grounds that its policy was excess and, therefore, did not include a duty to defend. Company settled the underlying litigation and filed suit for declaratory judgment, alleging that the excess Insurer breached its duty to defend pursuant to a "drop down" provision in the policy which provided that the policy would provide coverage on the same terms as the designated underlying insurance where the underlying insurance had been exhausted. The trial court granted summary judgement to Company with regard to the duty to defend, which the appellate court upheld, in part. In doing so, the court noted that, generally, when a complaint alleges facts which potentially give rise to coverage, an insurer must either defend the suit pursuant to a reservation of its rights, or seek a declaratory judgment that there is no coverage. However, with respect to excess policies with a drop down provision requiring exhaustion of the underlying coverage, the court found that an additional threshold applied, such that the excess Insurer's duty to defend is triggered only where the insurer had "actual notice" that the underlying policy had been exhausted. As a factual matter, the court held that excess Insurer had such "actual notice" with regard to certain underlying insurance, but remanded the matter for further proceedings with respect to coverage for which Insurer's notice was in dispute. Sinclair Oil Corp. v. Allianz Underwriters Ins. Co., 2015 Ill App (5th) 140069 (Apr. 7, 2015)

Radiologist is correct - Estate's case should be dismissed. In Illinois, claims against physicians are governed by a statute, 735 ILCS 5/13-212(a), and must be brought within two years from when "the claimant knew, or through the use of reasonable diligence should have known, or received notice in writing of the existence of the injury or death." The court found that the date the Estate discovered the negligence was, therefore, irrelevant. According to the court, the statute gives Illinois claimants two years from the date of that knowledge or notice of the death (i.e. not the alleged negligence) "to figure out whether there is actionable conduct." Case dismissed. Randall W. Moon v. Clarissa F. Rhode, M.D., et al., 2015 IL App (3d) 130613 (Apr. 10, 2015)