Cramer v. Insurance Exchange Agency

JUSTICE HARRISON, dissenting:

The majority has made a basic analytical error that is probably inadvertent but certainly unfair.

The issue before the circuit and appellate courts was whether plaintiffs pro se claim against its insurer for common law fraud was preempted by section 155 of the Illinois Insurance Code (215 ILCS 5/155 (West 1994)) or time-barred by a limitations provision contained in the insurance policy. This issue was raised in the context of a motion for summary judgment under section 2 — 1005 of the Code of Civil Procedure (735 ILCS 5/2 — 1005 (West 1994)), and both the circuit and appellate courts concluded that neither the Code section nor the contractual limitations provision defeated plaintiffs claim. Accordingly, the circuit court denied summary judgment, and the appellate court affirmed on a Rule 308 appeal (155 Ill. 2d R. 308).

My colleagues now reverse and remand with directions to enter summary judgment in favor of the insurer. That decision, however, has nothing to do with the lower courts’ reasoning. The majority agrees that section 155 of the Code does not preempt a common law fraud claim, and they decline to reach the limitations question. The reason my colleagues believe that summary judgment should be entered in favor of the insurer on plaintiffs common law fraud claim is simply that the allegations in plaintiffs complaint are insufficient to state such a claim.

The problem with this approach is that it overlooks how summary judgment is supposed to work. Contrary to the majority’s apparent belief, summary judgment cannot be used to challenge the sufficiency of a plaintiff’s complaint. The reason is simple. As this court has repeatedly held, a motion for summary judgment assumes that a cause of action has been stated. Delgatto v. Brandon Associates, Ltd., 131 Ill. 2d 183, 190 (1989); Janes v. First Federal Savings & Loan Ass’n, 57 Ill. 2d 398, 406 (1974). If the existence of a valid cause of action is assumed by the motion, granting the motion on the theory that a cause of action has not been properly stated, as the majority does here, is illogical.

Although we can affirm the judgment of a lower court on any grounds called for by the record (Leonard! v, Loyola University, 168 Ill. 2d 83, 97 (1995)), we should be reluctant to reverse for reasons that were not raised below, and the logical inconsistency of the majority’s opinion is a good illustration of why that is so. What makes the majority’s mistake especially troublesome to me is that it has left the plaintiff with no means for salvaging his case. This is not a situation where the plaintiff elected to stand on his pleadings after they were dismissed by the trial court. As previously noted, the sufficiency of the pleadings did not become an issue until now, and until now, the plaintiff had no reason to believe that his common law fraud allegations required modification. Now that the pleading defects cited by the majority have been brought to the plaintiff’s attention, there is every reason to believe that he would be able to cure them if given the opportunity.

By remanding with directions to enter judgment in favor of the insurer, the majority has denied plaintiff that opportunity. Such a result is incompatible with the principle that a cause of action should not be dismissed on the pleadings unless it is clearly apparent that no set of facts can be proven which would entitle a plaintiff to relief. Grzeszczak v. Illinois Farmers Insurance Co., 168 Ill. 2d 216, 223 (1995). If, by amendment, a plaintiff can state a cause of action, a case should not be dismissed with prejudice on the pleadings. Bowe v. Abbott Laboratories, Inc., 240 Ill. App. 3d 382, 389 (1992).

The majority’s result likewise contravenes the summary judgment statute. Subsection (g) of that statute expressly provides:

"Before or after the entry of a summary judgment, the court shall permit pleadings to be amended upon just and reasonable terms.” 735 ILCS 5/2 — 1005(g) (West 1994).

Under my colleagues’ analysis, this statutory right to amend has been nullified.

A situation similar to the one present here was addressed by the appellate court in Sinclair v. State Bank, 226 Ill. App. 3d 909 (1992). There, the circuit court refused to dismiss the plaintiff’s complaint, but on a Rule 308 appeal (134 Ill. 2d R. 308), the appellate court reversed, holding that the trial court should have dismissed plaintiff’s complaint on the pleadings. No remand was ordered. When the plaintiff subsequently attempted to amend his complaint in the circuit court to cure the pleading defects, the defendant objected, arguing that the appellate court’s reversal, without remand, constituted an adjudication on the merits, leaving the trial court without power to take further action in the case.

Although the trial court agreed with the defendant, the appellate court subsequently reversed. It held that where a defendant brings a Rule 308 appeal involving pleadings that were not dismissed on the trial level and the complaint is found to be fatally deficient for the first time on that appeal, the plaintiff should still be allowed to amend his complaint "unless the Rule 308 appellate opinion necessarily forecloses all theories of recovery.” 226 Ill. App. 3d at 915 .

The majority’s disposition here clearly does not foreclose all theories of recovery. It merely holds that the existing pleadings are inadequate to state a cause of action. For the reasons set forth above, the court is therefore wrong to reverse and remand with directions that judgment be entered in favor of the insurer. Plaintiff should be afforded the chance to plead again. Accordingly, I dissent.

CHIEF JUSTICE BILANDIC joins in this dissent.