The Illinois Supreme Court says defendants in personal injury lawsuits can’t use a quick settlement by another defendant to reduce the amount they owe, by declaring the already settled sum “uncollectable,” and forcing another defendant to help shoulder more of the remaining payout.
On June 17, the state high court weighed in on the question that had been posed by a Chicago federal appeals panel, which had struggled with how to interpret Illinois law in a complex case stemming from a truck-on-truck rear end collision in a road construction zone.
The case landed in federal court in 2014, about a year after a crash in downstate Madison County, near St. Louis, resulted in significant injuries to driver Thomas Roberts.
Brandon Copeland
| Brown & James
According to case narrative in the Supreme Court decision, Roberts was driving a truck westbound on Interstate 70 in Madison County, when he encountered a flagger in a road construction zone. According to the narrative, Roberts slowed as he approached the flagger. But the flagger allegedly suddenly switch the sign from “SLOW” to “STOP,” and Roberts “abruptly slammed on his brakes.”
A tractor trailer driven by Alexandre Solomakha then crashed into the rear of Roberts’ vehicle, injuring Roberts and allegedly leaving him with medical bills of more than $500,000.
Roberts and his wife, Diane Roberts, then filed suit in federal court in Southern Illinois against Solomakha and trucking firms Alexandria Transportation and Alex Express.
A year later, the trucking defendants, or “Alex Parties,” as they are known in the court documents, filed claims against Edwards-Kamalduski LLC, the general contractor overseeing that I-70 construction zone, and against Safety International, a subcontractor that managed “the construction site’s worker safety program.” The trucking companies asserted the flagger and the flagger’s employers should share in the blame and any judgment, as well.
In 2017, E-K settled with the Roberts couple for $50,000. The trucking companies objected, asserting E-K’s final share of the blame would be much more than that, as the Roberts had demanded more than $2 million in damages.
However, a judge signed off on the settlement, finding it was reached in “good faith,” and E-K was dismissed from the action altogether.
A few months later, the trucking defendants settled with the Roberts for $1.85 million. That settlement also released Safety from any action by the Roberts. But the Alex Parties continued to pursue their claim against Safety.
A jury hearing that claim ultimately ascribed 75% of the blame for the accident to E-K; 15% to the trucking companies; and 10% to Safety. With this information in hand, the judge ordered Safety to pay $190,000, or 10% of the combined settlements reached by the Roberts with E-K and the trucking companies.
The trucking companies, however, appealed that determination, arguing Safety should owe more. They asserted Illinois law should regard the liability ascribed to E-K as “uncollectable,” because their settlement had foreclosed the ability of anyone to go after them for a larger payout proportionate to their share of blame in the crash.
Thus, their share of the blame should be shared more equally by the trucking companies and Safety, the trucking companies argued.
“The Alex Parties reason that, since they cannot collect against E-K, then E-K’s obligation is uncollectable,” the Illinois Supreme Court opinion said, summarizing the trucking companies’ argument.
When that matter was posed to the U.S. Seventh Circuit Court of Appeals in Chicago, the appellate judges punted, sending the question to the Illinois Supreme Court to unravel, as it pertained to Illinois state law.
And on that appeal, the Illinois Supreme Court sided against the trucking companies.
They agreed with Safety’s contention that, while E-K’s settlement allowed them to be discharged from the action and from any further threat of greater liability, it did not render E-K’s share of the liability “uncollectable.”
“… E-K’s obligation ‘was not uncollectable – it was collected,’” the majority opinion said.
“In this case, when the Alex Parties established the total common liability to plaintiffs, they knew in advance what percentage of this contribution E-K had already paid and knew that this was all E-K would ever pay toward the common liability,” the court’s majority wrote. “The Alex Parties also knew that they would be able to recover from Safety only Safety’s pro rata share of fault and no more. The Alex Parties knew that Safety might be adjudged a small share of the total liability.
“The Alex Parties’ award of $190,000 in damages from Safety vindicates the Contribution Act’s public policy of equitably apportioning damages among tortfeasors.”
The 5-2 majority opinion was authored by Justice P. Scott Neville. Chief Justice Anne M. Burke and justices Rita B. Garman, Mary Jane Theis and David K. Overstreet concurred.
Justice Robert L. Carter dissented, along with Justice Michael J. Burke.
In the dissent, Carter argued the majority had misapplied the law, refusing to consider the law in relation to other statutes.
He said the majority improperly opted to apply the term “uncollectable” only to defendants who are considered “insolvent.” He noted state lawmakers had intentionally revised the law to remove any reference to “insolvent” defendants, or “tortfeasors.”
And he questioned the majority’s assertion that allowing the Alex Parties trucking companies to pursue a claim against Safety would be “unfair.” He noted Safety also had an opportunity to settle with the Roberts, but chose not to do so, yet still left the trucking companies largely holding the bag.
“… It is also arguably unfair to deny, or diminish, the Alex Parties’ contribution claim against a nonsettling joint tortfeasor such as Safety,” Carter wrote. “In fact, one could reasonably argue that Safety, a party who chose not to settle with plaintiffs, unfairly benefits from the Alex Parties’ settlement with plaintiffs because that settlement released claims against Safety and the Alex Parties paid plaintiffs the collective tort liability of themselves and Safety.”
Carter predicted the decision would ultimately require lawmakers to again revise state law to correct the perceived shortcomings of the majority’s decision.
Alex Express and the trucking company defendants were represented by attorneys Lori A. Vanderlaan and Wade T. Shimer, of the firm of Best Vanderlaan & Harrington, of Chicago.
Safety International was represented by attorneys David P. Bub and Brandon B. Copeland, of the firm of Brown & James, of St. Louis.