Cove Management v. AFLAC, Inc.

2013 IL App (1st) 120884, 369 Ill. Dec. 570
CourtAppellate Court of Illinois
DecidedMarch 8, 2013
Docket1-12-0884
StatusPublished
Cited by19 cases

This text of 2013 IL App (1st) 120884 (Cove Management v. AFLAC, Inc.) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cove Management v. AFLAC, Inc., 2013 IL App (1st) 120884, 369 Ill. Dec. 570 (Ill. Ct. App. 2013).

Opinion

ILLINOIS OFFICIAL REPORTS Appellate Court

Cove Management v. AFLAC, Inc., 2013 IL App (1st) 120884

Appellate Court COVE MANAGEMENT, Plaintiff-Appellant, v. AFLAC, INC., a Caption Corporation, Defendant- Appellee (Darren Galgano and Barbier Group, Inc., Defendants).

District & No. First District, Sixth Division Docket No. 1-12-0884

Filed March 8, 2013

Held A property management company’s action for breach of contract, (Note: This syllabus “ratification” and unjust enrichment against defendant insurance company constitutes no part of based on a lease executed by an independent contractor engaged by the the opinion of the court insurer to sell policies was properly dismissed, notwithstanding plaintiff’s but has been prepared contention that the independent contractor had apparent authority to by the Reporter of execute the lease on the insurer’s behalf, that the insurer ratified the lease, Decisions for the and that the insurer was unjustly enriched, since plaintiff failed to make convenience of the a reasonable inquiry as to whether the independent contractor had reader.) authority to bind the insurer, the insurer had no knowledge of the lease until after plaintiff sued, and without knowledge, the insurer could not accept the services provided.

Decision Under Appeal from the Circuit Court of Cook County, No. 10-L-9069; the Hon. Review Brigid Mary McGrath, Judge, presiding.

Judgment Affirmed. Counsel on Samuel A. Shelist, of Shelist Law Firm, LLC, of Chicago, for appellant. Appeal Peter H. Rodenburg and Randall E. Server, both of Tucker Robin & Merker, LLC, of Chicago, for appellee.

Panel JUSTICE GORDON delivered the judgment of the court, with opinion. Presiding Justice Lampkin and Justice Hall concurred in the judgment and opinion.

OPINION

¶1 Plaintiff Cove Management filed a lawsuit against defendants Darren Galgano, Barbier Group, Inc., and AFLAC, Inc.1 Against defendant AFLAC, plaintiff alleged counts of breach of contract, “ratification,” and unjust enrichment arising from conduct by defendant Darren Galgano.2 AFLAC filed a combined motion, pursuant to both sections 2-619(a)(9) and 2-615 of the Illinois Code of Civil Procedure (735 ILCS 5/2-615, 2-619(a)(9) (West 2010)), to dismiss the claims against it, setting forth each motion in separate sections. The trial court granted AFLAC’s section 2-619(a)(9) motion and dismissed the claims against AFLAC with prejudice, finding that AFLAC had sufficiently raised affirmative matters which defeated plaintiff’s claims. In this interlocutory appeal, plaintiff appeals the dismissal of its claims against AFLAC, pursuant to Illinois Supreme Court Rule 304(a) (eff. Feb. 26, 2010). For the following reasons, we affirm.

¶2 BACKGROUND ¶3 I. The Parties ¶4 Defendant AFLAC is engaged in the business of underwriting and selling insurance policies in the health care field. On September 22, 2004, defendant Darren Galgano signed an “Associate’s Agreement” with AFLAC, which engaged Galgano to solicit applications for insurance policies offered for sale by AFLAC. The agreement also states that Galgano is an independent contractor, without the authority to bind AFLAC for Galgano’s “debts, faults, or actions.” The agreement specifically states that Galgano is prohibited from entering

1 The complaint refers to AFLAC simply as “AFLAC.” AFLAC notes in its motions to dismiss that it was “incorrectly sued” as AFLAC because defendant was incorporated as American Family Life Assurance Company of Columbus. 2 Defendants Galgano and Barbier Group, Inc., Galgano’s corporation entity, are not parties to this appeal.

-2 2- into contracts or incurring debt on behalf of AFLAC. On September 5, 2005, Galgano signed a “District Sales Coordinator’s Agreement,” which incorporated the terms of the “Associate’s Agreement” and specifically withheld authority from Galgano to “rent any office space or telephone, open any bank account, or make any expenditure, obligation or commitment for any purpose in the name of AFLAC without specific written authorization from the president, a vice president, or secretary of AFLAC.” On August 6, 2007, Galgano signed a “Regional Sales Coordinator’s Agreement,” which incorporated the “District Sales Coordinator’s Agreement” and once again withheld authority from Galgano to rent office space, incur debt, or enter into a contract on AFLAC’s behalf without express written authorization of the president, a vice president, or a secretary of AFLAC. ¶5 On September 4, 2009, Galgano leased retail property located at 4701 Midlothian Turnpike in Crestwood, Illinois, from plaintiff Cove Management. The first page of the lease listed plaintiff as the lessor, listed “AFLAC” as the tenant,3 and listed Galgano as the guarantor. The lease provided that the permitted use of the space was “insurance services.” On the signature page, Joseph Bertucci, on behalf of plaintiff, signed under “lessor,” and Galgano signed his own name under “lessee”4 and “guarantor.” He did not indicate on the signature page that he was signing on behalf of AFLAC.

¶6 II. The Complaint and Amended Complaint ¶7 Initially, plaintiff filed a three-count complaint against all three defendants, alleging (1) breach of contract, (2) breach of guarantee, and (3) unjust enrichment or quantum meruit. AFLAC filed a motion under section 2-619(a)(9) of the Illinois Code of Civil Procedure (735 ILCS 5/2-619 (West 2010)) to dismiss the complaint, affirmatively asserting that Galgano was an independent contractor who could not bind AFLAC to the lease. ¶8 The trial court granted AFLAC’s motion and dismissed the complaint without prejudice to replead. Plaintiff then filed an amended complaint, alleging counts of breach of contract, “ratification,” and “unjust enrichment or quantum meruit” against AFLAC. Plaintiff later filed a second amended complaint, alleging three counts against AFLAC: breach of contract (count I); ratification (count II); and unjust enrichment (count IV). Plaintiff attached numerous exhibits to the complaint, including (1) the signed agreements between AFLAC and Galgano which engaged Galgano’s services on behalf of AFLAC and limited Galgano’s authority to sign contracts on AFLAC’s behalf; (2) Lynn Fry’s affidavit, in which she stated that she was a vice president of AFLAC at the time Galgano signed the lease, and that Galgano is an independent contractor without authority to sign the lease on behalf of AFLAC; (3) the signed lease; (4) a check, dated July 21, 2012, payable to plaintiff for $1,610 from an account in the name of defendant Barbier Group, Inc., at 414 North Orleans Street,

3 The front page of the lease used the word “tenant,” but not the word “lessee” to describe AFLAC. 4 On the signature page, the lease used the word “lessee,” but not the word “tenant” to describe Galgano.

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2013 IL App (1st) 120884, 369 Ill. Dec. 570, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cove-management-v-aflac-inc-illappct-2013.