May 2018 Case Notes & Comments

"I will miss seeing the enchantingly peaceful limb of our Earth from this vantage point .... my eyes will search the horizon to see that curve." ~ Record-breaking astronaut, Peggy Whitson (288 days in space)

MONTHLY QUIZ: A home improvement Contractor sued the Better Business Bureau alleging defamation, commercial disparagement, tortious interference with contract and violation of the Uniform Deceptive Trade Practices Act.  These claims were premised on the allegations that the BBB made defamatory statements by giving Contractor a "D-" rating and telling potential customers that Contractor was not a good company.  BBB moves to dismiss, arguing that it is protected by the First Amendment.  Is the BBB entitled to such protection? You be the judge. (Answer below).

LEF WINS PREMISES TRIAL: Congratulations to William P. McElligott who prevailed on behalf of the Defendant in a jury trial held in Cook County, Illinois at the Daley Center.  Plaintiff slipped and fell on an accumulation of ice at a shopping center in 2011. Plaintiff sued the owner and property manager of the shopping center.  The ice accumulated as a result of a fire sprinkler test performed by the Third-Party Defendant just hours before Plaintiff's accident.  Bill successfully argued that the owner and property manager did not have actual or constructive notice of the accumulated ice that caused Plaintiff's fall.  Bill was also successful in a pre-trial motion which barred Plaintiff from alleging that the fire sprinkler company was an agent of the owner or property manager.

APPRAISAL & MATCHING - COURT CONSTRUES POLICY TO REQUIRE FULL REPLACEMENT IF NO MATCH CAN BE FOUND: Insured-Condo Association submitted a claim to Insurer for a storm that physically damaged a building's south and west elevations, but not the north and east elevations. The policy required Insurer to "pay for direct physical 'loss' to Covered Property caused by or resulting from" the storm, with the amount of loss being "[t]he cost to replace the lost or damaged property with other property ... [o]f comparable material and quality ... and [u]sed for the same purpose," or "of like kind and quality." While Insurer and Condo agreed that the storm was a "Covered Cause of Loss," the parties disagreed about whether the coverage under the policy required partial replacement of the damaged siding, or full replacement of all four sides since no matching siding was available. In discovery, Condo and Insurer submitted conflicting evidence as to whether a match existed. Condo then moved for partial summary judgment on the issue of whether the policy required full replacement. Though it conceded a dispute of fact as to the existence of a match, the court entered partial summary judgment against Insurer anyway. According to the court, assuming that no match could be found, "the only sensible result [from the court's reading the policy] is to treat the damage as having occurred to the building's siding as a whole." Additionally, the court commented that "even if this were not the only sensible reading of the policy," the policy terms were "ambiguous" and "indeterminate" and could be reasonably construed to require a full replacement. Following the partial grant of summary judgment in favor of Condo, the court ordered that the issues of whether in fact such siding was available, and thus whether Insurer must replace the siding on "all four elevations or only on the physically damaged south and west elevations, shall be submitted to appraisal."  The Windridge Of Naperville Condo. Ass'n v. Philadelphia Indem. Ins. Co. Case No. 16 C 3860 (N.D.Il. Apr. 13, 2018). COMPARE: Runaway Bay Condo. Ass'n v. Philadelphia Indem. Ins. Co. Case No. 16 C 9551, 262 F.Supp.3d 599 (Apr.25, 2017)(In a similar damage scenario, the Northern District of Illinois Court held that "the question of whether the Policy requires replacement of undamaged property to achieve matching is not appropriate for appraisal" since deciding the merits of the argument would require an interpretation of the expression "comparable material and quality," which was a "paradigmatically legal question." Nevertheless, the Court granted the insureds motion to compel appraisal on the issues of causation, physical damage and overhead and profit.)

APPRAISAL AWARD VACATED FOR LACK OF JURISDICTION: Insureds submitted a claim to Insurer under a homeowner's policy for their home and property destroyed in a covered fire. Both sides agreed that the fire resulted in a total loss, but could not agree on the loss valuation. The policy provided for an appraisal process in the event of a disagreement regarding the amount of a loss. Under the appraisal provision, either Insurer or Insureds could ask a judge of a court of record in the state where the residence was located to select an umpire. Unable to reach an agreement on the amount of the loss, Insured sent a letter demanding that the loss be settled by appraisal. Though Insurer was required to identify its appraiser within 20 days of receipt of the appraisal demand and both appraisers were to agree on an umpire 15 days thereafter, both deadlines passed without Insurer identifying an appraiser or selecting an umpire. Thereafter, Insured filed a petition to appoint an appraisal umpire with an Illinois court. On the same day Insured's petition was filed, the trial court granted same and appointed an umpire and entered an order retaining jurisdiction for the "filing and enforcement of a binding appraisal award," even though there was no evidence that Insurer had been formally served with the Insured's petition. Insurer filed a motion to vacate the order seven days thereafter, contending that it had not been properly served and that the order was entered without proper notice and without due process. Insured argued that Insurer had forfeited and defaulted on its obligations to participate in the appraisal process. Insureds also argued, among other things, that because the appraisal provision did not require the issuance of summons and service of the petition for appointment of an appraisal umpire, Insurer's motion should be denied. Prior to the hearing on Insurer's motion to vacate the appointment, Insurer's appraiser and the umpire filed an appraisal award approximately equal to the loss valuation originally asserted by Insureds, which was eventually confirmed. Insurer subsequently moved to vacate the award. After multiple hearings, the trial court denied Insurer's motions to vacate the appointment and award. The appellate court reversed and vacated the orders appointing the appraisal umpire and order confirming the appraisal award, reasoning that as no summons was issued, Insurer was not served with Insured's petition and that therefore, the trial court lacked jurisdiction. Further, the court held that the appraisal provision whereby the parties could submit the matter to "a judge of a court of record" contemplated a judicial proceeding whereby the circuit court and the parties were bound to follow the established rules of civil procedure. In such proceedings, parties must have notice and an opportunity to be heard, unless that party had waived those rights. Under the facts, the appellate court determined that Insurer had not waived its right to be heard. Witcher v. State Farm Fire & Casualty Co., 2018 IL App (5th) 170001 (Mar. 6, 2018).

NEW STATUTORY PROTECTIONS TO PREVENT DISCRIMINATION IN JURY SELECTION: At common law and pursuant to a line of cases dating back to 1986, discrimination in jury selection (i.e., the use of peremptory challenges to remove specific members of the venire) on the basis of race, gender, ethnic background, and sexual orientation is unlawful. Age is not a protected class for purposes of alleging discrimination in juror selection at common law. Effective January 1, 2018, the Illinois Legislature has amended its statute concerning jury qualifications (705 ILCS 305/2) to codify particular classes for protection in jury selection on the basis of race, color, religion, sex, national origin, and economic status. Sexual orientation was not a statutorily-protected class under Illinois' amended statute. Where a party challenges the use of a peremptory strike on the basis of discrimination, the court follows a three-step process, laid out by the United States Supreme Court, to determine whether purposeful discrimination has been demonstrated.  (705 ILCS 305/2, P.A. 100-228, eff. 1-1-18.)

ANSWER TO QUIZ:  BBB wins.  As the BBB's website and informational pamphlets make clear, the BBB's assignment of a letter grade is a subjective assessment based upon subjective criteria and the subjective interpretation of data; it is not a statement of fact that may be proven true or false.  No reasonable person could therefore believe that the BBB's ratings were statements of fact, as opposed to opinions.  Consistent with courts in other jurisdictions, the Third District Appellate Court held that the ratings assigned by the BBB or by other entities are opinions protected by the First Amendment, and are therefore afforded a qualified privilege under Illinois law. Perfect Choice Exteriors, LLC v. Better Business Bureau of Central Illinois, 2018 IL App (3d) 150864 (Mar. 12, 2018).

Past Publications

2022

October 2022
August 2022
July 2022
April 2022
March 2022
January 2022

2021

December 2021
October 2021
August 2021
July 2021
May 2021
April 2021
March 2021
January 2021

2020

December 2020
November 2020
October 2020
September 2020
August 2020
February 2020
January 2020

2019

December 2019
October 2019
September 2019
July 2019
May 2019
March 2019
February 2019
January 2019

2018

December 2018
October 2018
August 2018
June 2018
May 2018
April 2018
March 2018
February 2018

2017

December 2017
November 2017
October 2017
September 2017
August 2017
July 2017
June 2017
May 2017
March 2017
February 2017

2016

December 2016
October 2016
September 2016
August 2016
July 2016
June 2016
March 2016
January 2016

2015

December 2015
September 2015
August 2015
July 2015
June 2015
May 2015
April 2015
March 2015
February 2015
January 2015

2014

December 2014
October 2014
September 2014
July 2014
June 2014
April 2014
April 2014
March 2014
February 2014
January 2014

2013

December 2013
November 2013
October 2013
September 2013
August 2013
July 2013
June 2013
May 2013
April 2013
March 2013
January 2013

2012

December 2012
November 2012
October 2012
September 2012
August 2012
July 2012
June 2012
May 2012
April 2012
March 2012
February 2012
January 2012

2011

December 2011
November 2011
October 2011
September 2011
August 2011
July 2011
June 2011
May 2011
April 2011
March 2011
February 2011
January 2011

2010

December 2010
November 2010
October 2010
September 2010
August 2010
July 2010
June 2010
May 2010
April 2010
March 2010
February 2010
January 2010

2009

December 2009