Nickon v. City of Princeton

Opinion

No. 3–06–0952 ______________________________________________________________________________ Filed October 24, 2007. IN THE

APPELLATE COURT OF ILLINOIS

THIRD DISTRICT

A.D., 2007

NICK NICKON, ) Appeal from the Circuit Court ) of the 13th Judicial Circuit, Plaintiff-Appellee, ) Bureau County, Illinois, ) v. ) No. 03–-L-–53 ) CITY OF PRINCETON, ) Honorable ) Marc P. Bernabei Defendant-Appellant. ) Judge, Presiding. ______________________________________________________________________________

JUSTICE WRIGHT delivered the opinion of the court : ______________________________________________________________________________

Plaintiff Nick Nickon filed a negligence action against defendant City of Princeton for

injuries he sustained when he tripped and fell on a sidewalk. A jury rendered a verdict for

plaintiff. Defendant timely appealed. We affirm.

BACKGROUND

On August 6, 2003, Nick Nickon sustained injuries after falling on a sidewalk located on

Main Street in Princeton. This sidewalk was located on a State of Illinois right-of-way for Illinois

Route 26 which is known as Main Street within the city limits of Princeton.

When defendant made improvements to the roadway on Main Street in downtown

Princeton, defendant and the State negotiated to share the costs. The Illinois Department of

-1- Transportation (IDOT) agreed to maintain the traffic lanes after completion of the project and the

city agreed to maintain the sidewalks. In accordance with that agreement, over the course of the

last decade prior to the accident in this case, defendant made repairs to the Main Street sidewalk.

Before trial, the trial court allowed defendant’s motion in limine to prohibit testimony

regarding previous injuries sustained by another person at the same location on Main Street.

During trial, Georgianne Johnson testified that one year before plaintiff’s fall she stepped into the

same depression and fell. However, Johnson also testified that she sustained injuries as a result of

her accident in August 2002. Defendant objected to this portion of her testimony. The court

sustained defendant’s motion to strike the testimony for being in violation of the pretrial order

granting defendant’s motion in limine. The court instructed the jury to disregard that portion of

the answer. The court also allowed Johnson to explain to the jury that her injuries were minor

and did not require medical attention.

During trial, plaintiff introduced evidence of medical bills for his injuries totaling

$119,723.11. Defendant attempted to produce evidence that the medical care providers

discounted the charges after receiving the Medicare payment. However, the court prohibited

defendant from introducing any evidence to the jury that demonstrated Medicare paid a reduced

amount, $34,888.61 in total, as payment in full for the medical bills. The trial court employed the

collateral source rule and did not permit the jury to hear evidence of the significant reduction of

charges.

The jury rendered a verdict in favor of plaintiff and against defendant in the amount of

$170,800, which included initially billed medical charges of $119,000.00. Following the jury

verdict, defendant filed a two-part posttrial motion. The trial court denied defendant’s posttrial

-2- requests for judgment notwithstanding the verdict on the issue of an open and obvious defect on

the sidewalk. The court also denied defendant’s posttrial request for set-off or reduction of the

verdict to reflect the amount actually paid by Medicare. Defendant appealed.

We will recount additional facts as relevant to our analysis.

ANALYSIS

Defendant raises five issues on appeal. First, defendant contends the trial court erred in

entering summary judgment on the issue of “control” of the sidewalk where plaintiff was injured.

Second, defendant asserts that plaintiff’s violation of the trial court’s order in limine precluding

evidence of a prior injury to another person on the same sidewalk requires reversal. Third,

defendant argues that the trial court erred by denying defendant’s tendered jury instruction

concerning immunity. Fourth, defendant submits that the trial court erroneously denied a posttrial

motion to set-off or reduce the jury award and an alternative request for judgment in favor of

defendant notwithstanding the verdict. Finally, defendant contends that the jury should have been

allowed to consider the actual amount Medicare paid for plaintiff’s medical bills. We will address

the collateral source issues first and foremost.

Defendant raises two issues regarding the Medicare payment in this case. First, defendant

argues the jury should have been allowed to consider evidence that the health care provider

accepted a Medicare payment in the amount of $34,888.61 as payment in full for charges

originally billed at $119,723.11. Plaintiff asserts the trial court correctly applied the collateral

source rule by prohibiting the introduction of this evidence. Defendant contends the Medicare

payment does not qualify as a collateral source under Illinois law.

Next, in a related issue, defendant claims the trial court erroneously denied its posttrial

-3- motion for set-off or reduction of the jury’s award. Defendant claims the jury award for medical

expenses should be reduced to the amount actually paid by Medicare, $34,888.61. Alternatively,

defendant asserts the amount Medicare paid, $34,888.61, should be further adjusted downward by

the 30% measure of comparative fault the jury attributed to plaintiff.

Regarding both issues, defendant relies heavily on the dissent in Arthur v. Catour, 216 Ill.

2d 72 (2005). For purposes of our analysis, it is important to understand the issue in Arthur came

before the reviewing courts on a certified question raised before the jury trial began. This

certified question was whether “plaintiff will be limited to seeking compensatory damages not

exceeding those actually paid to her medical providers.” Arthur, 216 Ill. 2d at 76.

To answer that question in the context of the case on review in Arthur, the supreme court

had to determine whether the collateral source rule extends to the entire amount initially charged

for medical services, even when those services are later discounted by the provider when paid by a

third party. Significant to the court’s analysis in Arthur was the amount the medical provider

“expected” as payment when initially billing for the services, not the amount the medical provider

“accepted” from a third party as payment in full. So considered, the court’s unequivocal answer

to the certified question was, “Plaintiff may present to the jury the amount that her health-care

providers initially billed for services rendered.” Arthur, 216 Ill. 2d at 83. This answer was

consistent with well established precedent.

With a great degree of foresight and long before Arthur, our supreme court carved a

single exception to the collateral source rule. First recognized in this District nearly one hundred

years ago, this exception dictates collateral sources should not include services provided by

charitable providers without charge, i.e., without generating an initial bill. Peterson v. Lou

-4- Bachrodt Chevrolet Co., 76 Ill. 2d 353, 363 (1979) (citing Adams Co. v. George, 227 Ill. 64, 69

(1907)).

In Peterson, the medical provider was the philanthropical Shriner hospital, renowned for

generously providing medical care for children free of charge to the family. Defendant seeks to

expand Peterson beyond gratuitous medical care to the situation presented in the case at bar. The

exception developed by the court in Peterson, does not apply in our case since the medical

provider clearly billed for the services in expectation of payment, unlike the Shriner hospital in

Peterson. We refrain from applying the decision in Arthur to expand the reach of Peterson to

services initially billed but subsequently discounted for a third party payor.

Our decision today relies heavily on the blueprint provided by our supreme court in a line

of cases discussing the collateral source rule. The court has stated the collateral source rule does

not allow a wrongdoer to take advantage of “contracts or other relations that may exist between

the injured party and third persons.” (Emphasis added.) Wilson v. Hoffman Group, Inc., 131 Ill.

2d 308, 320 (2005). Clearly, the Wilson court foresaw the possibility that relationships “other

than” those arising from a contract of insurance may constitute collateral sources for payment.

Thus, the rule of Wilson is not limited only to contractual payments. The injured party in this case

had a relationship “other than” a contract with the collateral source. Here, plaintiff’s relationship

with Medicare arose because of his previous employment, his past contributions, and his current

age.

Relying on the dissent in Arthur, defendant seeks to cast Medicare into a separate

category which would not be protected by the collateral source rule. In her dissent, Chief Justice

McMorrow characterized the majority’s answer to the collateral source issue in Arthur as “no

-5- answer at all.” Arthur, 216 Ill. 2d at 87 (McMorrow, C.J., dissenting). However, based on our

reading of Arthur, the majority provided a concise answer to the specific evidentiary question as

posed without equivocation or conditional parameters. “Initially billed” is not difficult to

understand when considering evidence to be submitted to the jury. “Initially billed” has no

bearing on "ultimately paid."

By focusing on the amount initially billed, the Arthur court’s decision recognizes a

practical reality. That is, if a government agency or insurance company does not pay the patient’s

bill at the reduced rate offered to the third party payor, liability for the amount initially billed falls

squarely on the patient’s financial shoulders. This liability is not relieved until payment is received

from any source, thereby triggering the collateral source rule.

The supreme court's answer to the evidentiary question in Arthur preempts the endless

discussion of distinguishing details concerning who pays medical charges on behalf of an injured

party. This practical answer to the collateral source question is easily applied without reference to

the source of the payment. Pursuant to Arthur, simply give the jury the initial bill and move on

with the evidence. After a verdict is rendered, the trial court may consider a motion to reduce the

award, as was done in this case.1

The certified question in Arthur is identical to the evidentiary issue presented to the trial

judge in this case. We conclude the trial court correctly applied Arthur to preclude introduction

of reduced payments to the jury.

1 We are aware of the Fourth District’s decision in Wills v. Foster, 372 Ill. App. 3d 670 (2007), appeal pending No. 104538, adding Medicare and Medicaid exceptions to the collateral source rule. We choose not to follow the majority’s rationale in that decision, and we anticipate the Illinois Supreme Court will provide further guidance on the issue.

-6- Next, defendant claims the trial court erred when it denied the posttrial motion for set-off

or reduction of the jury award in this case. This issue is procedurally distinct from Arthur. On a

motion for set-off or reduction, we must consider whether our supreme court’s decision in

Peterson limits plaintiff’s recovery and requires a reduction of the award.

To determine whether the Peterson exception applies, we must examine whether the

medical service provider in this case intended to grant the patient gratuitous services regardless

of the source of payment. If, as in Peterson, the medical provider intended not to charge the

patient for services or a portion of those services, the payment is not a collateral source payment.

However, if the medical provider accepted a reduced payment from a third party which the

medical provider otherwise would not have granted to the patient without the involvement of the

third party, the payment is a collateral source payment.

To interpret Peterson any other way lends itself to endless analysis of the minute

differences in each case related to the relationship between payor and patient, depending on

whether Medicare or Medicaid paid for services, and whether the insurance company was paid

by the injured person or someone else, such as patient’s husband in Arthur. These considerations

create a plethora of possibilities to tantalize the most skillful advocates and curious legal

scholars, but this type of complexity is not necessary.

In the context of a motion for set-off or a reduction of the verdict, a collateral source rule

that depends on the status of the injured party to the agency paying the medical bills would give

the word “angst” a new meaning to those sitting on the trial bench. Insurance companies and

other agencies receive large volume discounts arising from ongoing relationships with the

medical providers unrelated to the medical providers' relationship with the injured party. A

-7- reduction of charges based on a high volume allowed to a third party payor is not the correct

measure for consequential damages to the individual suffering the injury. The injured party would

have been responsible for all charges, or perhaps billed at an even higher rate, had a private

insurer or Medicare not been forthcoming with payment.

As an ancillary issue, defendant claims the trial judge erred prior to trial by refusing to

allow a witness to testify that the reduced charges were fair and reasonable for persons 65 years

of age or older. By implication, the testimony would have established the initial bill was

excessive. Defense counsel suggested that the reduced charges were relevant to the

reasonableness of the initial billed medical services. However, the trial court quickly pinpointed

the flaw in this proposition. The trial court stated, “If the only reason such a witness would

offer [reduced fees] vis-à-vis a patient over 65 is because Medicare pays a discounted amount,

then that’s off limits.”

The trial court correctly recognized defendant offered this evidence to introduce the

collateral source payment to the jury through the back door. The tactic was contrary to the

purpose of the collateral source rule and was properly rejected by the court before the trial

began. Furthermore, we note the record does not establish defendant had such a witness

available to testify. An offer of proof was not tendered either during trial or at the motion

hearing. Accordingly, the court did not err in rejecting defendant's challenge based on

"reasonableness" of the charges to Medicare.

Defendant raises several contentions of error in addition to the collateral source issues

discussed above. First, defendant contends that the trial court erred in entering summary

judgment in favor of plaintiff on the issue of control of the sidewalk. Defendant argues that it did

-8- not have responsibility to maintain the sidewalk which was owned by the State of Illinois. Since

IDOT did not compensate defendant for the maintenance of the sidewalk, defendant submits that

control of the sidewalk constituted a disputed issue of material fact.

We consider the circuit court’s ruling on a motion for summary judgment de novo.

Delany v. McDonald’s Corp., 158 Ill. 2d 465, 467 (1994). Summary judgment is proper if the

pleadings, depositions, and admissions on file, viewed in the light most favorable to the

nonmoving party, show there are no genuine issues of material fact and that the moving party is

entitled to judgment as a matter of law. 735 ILCS 5/2–1005(c) (West 2002); Murray v. Chicago

Youth Center, 224 Ill. 2d 213, 228 (2007).

The parties agree the sidewalk where plaintiff fell was located on an IDOT right-of-way.

However, on September 2, 1986, and later on August 23, 1996, the state and defendant entered

into contracts which required defendant to maintain the sidewalks adjacent to the state highway

along Main Street for as long as Illinois Route 26 served as Main Street in Princeton. The State

agreed to pay a portion of the roadway improvements to Main Street. In exchange for

improvements at the state’s expense, defendant agreed to control and pay for maintenance of all

other improvements to Main Street, including “all parking lanes, curbs, gutter flags, sidewalks,

manholes, catch basins, storm sewers, utilities and appurtenances.” Based on the clear language

of the contracts, the trial court determined defendant controlled the sidewalk.

In addition, undisputed evidence established defendant repaired the Main Street sidewalk

both before and after the incident in this case. Several years before plaintiff's fall, defendant

repaired areas of the sidewalk on Main Street by pouring new concrete. After the accident in

this case, defendant repaired the area where plaintiff stumbled and fell. We conclude the trial

-9- court correctly found there was no genuine issue of material fact concerning control of the

sidewalk. Consequently, we hold the trial court properly entered summary judgment in favor of

plaintiffs on the issue of control of the sidewalk.

Next, defendant demands a new trial because plaintiff violated the court’s order granting

defendant's motion in limine. This pretrial ruling prohibited Georgianne Johnson from testifying

that on a prior occasion she also suffered an injury from a fall at the same location on Main

Street. The court ruled that Johnson’s testimony was relevant on the issue of notice regarding

the condition of the sidewalk but prohibited her from testifying regarding her injury. Defendant

contends Johnson’s testimony, which indicated she fell and also suffered minor injuries, was

prejudicial.

Following a general introductory question by plaintiff's attorney, Johnson volunteered

that she fell and was injured. Defendant immediately objected to the testimony. The trial court

struck the portion of Johnson’s answer concerning her injury and instructed the jury to disregard

the answer. After counsel and the court conferenced the issue, Johnson was permitted to further

explain that her injury was minor and did not require any medical attention. Defendant did not

object to this explanatory testimony.

Generally, any prejudicial impact of an error may be cured if the trial judge sustains an

objection and instructs the jury to disregard the objectionable testimony. Clayton v. County of

Cook, 346 Ill. App. 3d 367, 383 (2003). Based on our review of the record, we find the judge’s

instruction to the jury to disregard the portion of Johnson’s testimony that violated the motion in

limine, together with Johnson’s subsequent clarifying testimony, cured any prejudice that may

have occurred. Accordingly, we determine the court’s treatment of the testimony did not

-10- constitute reversible error.

Another contention of error raised by defendant pertains to defendant’s instruction No.

15, which the trial judge refused. Defendant’s instruction addressed statutory municipal

immunity, as defined in section 3–102 of the Local Governmental and Governmental Employees

Tort Immunity Act (745 ILCS 10/3–102 (West 2002)). Defendant's tendered instruction No. 15

stated a local public entity has a duty to maintain property in a reasonably safe condition for

foreseeable uses and shall not be liable unless the public body has constructive notice of a

condition which is not reasonably safe. Defendant contends serious prejudice resulted from the

trial court’s refusal to give the instruction. However, defendant does not describe the serious

prejudice caused by the trial court’s refusal to allow the instruction.

Plaintiff argues that defendant’s instruction No. 10, which incorporated IPI, Civil, No.

120.08 (Illinois Pattern Jury Instructions, Civil, No. 120.08 (2005 ed.) (hereinafter IPI Civil

(2005)), adequately stated the law and that defendant’s tendered instruction No. 15 was

redundant. Defendant’s instruction No. 10 stated, in relevant part:

“In order to recover damages, the plaintiff has the burden of proving:

First, there was a condition on the property which presented an

unreasonable risk of harm to people on the property.

Second, the defendant knew or in the exercise of ordinary care should

have known of both the condition and the risk.

Third, the defendant could reasonably expect that people on the property

would not discover or realize the danger.

Fourth, the defendant was negligent in one or more of the following ways:

-11- (a) Permitted and allowed the sidewalk at the location aforesaid to be

and remain in an uneven and depressed condition when defendant

knew, or by the exercise of ordinary care should have known, that

such condition created a situation of imminent danger for persons,

such as plaintiff, walking thereon;

(b) Failed to repair the uneven and defective sidewalk at the location

aforesaid when defendant knew, or in the exercise of ordinary care

should have known, that such repair was necessary to ensure the

safe conduct of persons, such as plaintiff, walking thereon;

(c) Maintained the sidewalk at the location aforesaid in an uneven and

defective condition for an unreasonable length of time.

Fifth, the plaintiff was injured.

Sixth, the defendant’s negligence was a proximate cause of the plaintiff’s

injury.”

Supreme Court Rule 239(a) (177 Ill. 2d R. 239(a)) requires a trial court to instruct the

jury pursuant to the Illinois Pattern Jury Instructions when applicable in a civil case, unless the

trial court determines that the IPI instruction does not accurately state the law. “The trial court

has discretion to determine which instructions to give the jury and that determination will not be

disturbed absent an abuse of that discretion.” Schultz v. Northeast Illinois Regional Commuter

R.R. Corp., 201 Ill. 2d 260, 273-74 (2002). On review, we must determine whether, “taken as a

whole, the instructions fairly, fully, and comprehensively apprised the jury of the relevant legal

principles.” Schultz, 201 Ill.2d at 273-74.

-12- In Livings v. City of Chicago, 26 Ill. App. 3d 850 (1975), the trial court denied an

instruction tendered by the defendant that was almost identical to the instruction proposed by

defendant in this case. The appellate court affirmed the trial court, finding that the other IPI jury

instructions adequately informed the jury of the issues of notice and the plaintiff’s burden to

prove the claims. Livings, 26 Ill. App. 3d at 853.

We have reviewed defendant’s proposed instruction and the other IPI instructions given

to the jury here. We note that, since plaintiff was walking on the sidewalk when the injury

occurred, the foreseeable use component of Tort immunity Act is not relevant to the facts of this

case. Additionally, constructive notice to the city was a required element included in defendant’s

instruction No. 10, which the trial court allowed. We conclude the jury was adequately and

correctly instructed on the law. Accordingly, we hold the trial court did not abuse its discretion

by refusing the redundant jury instruction.

Finally, defendant submits that the trial court should have granted its motion for judgment

notwithstanding the verdict, because plaintiff failed to prove that “people on the property would

not discover or realize the danger” of the depression. We review the trial court’s denial of a

judgment notwithstanding the verdict motion de novo. McClure v. Owens Corning Fiberglas

Corp., 188 Ill. 2d 102, 132 (1999).

A “ ‘[j]udgment notwithstanding the verdict should not be entered unless the evidence,

when viewed in the light most favorable to the opponent, so overwhelmingly favors the movant

that no contrary verdict based on that evidence could ever stand.’ ” McClure, 188 Ill. 2d at

131-32 (quoting Holton v. Memorial Hospital, 176 Ill. 2d 95, 109 (1997)). In reviewing the trial

court’s denial of a motion for judgment notwithstanding the verdict, we may not substitute our

-13- judgment for the jury’s, nor may we re-weigh the evidence or determine the credibility of

witnesses. Maple v. Gustafson, 151 Ill. 2d 445, 452-53 (1992).

Defendant denies liability in this case because the depression in the sidewalk was “open

and obvious.” We disagree. The photographs entered into evidence show a small depression

similar in color to the sidewalk, but partially covered by weeds. The photographs depict the

depression from different distances and demonstrate the extent of the depression was not visible

until the photographer’s camera was almost directly above the depression. The indentation

tapered from zero at the east edge to 2-1/4" at the west edge. However, the west edge and

deepest portion of the crevice was not readily visible. In fact, Steve Wright, the superintendent

of streets for defendant, testified that he considered the depression to be a dangerous hole.

Moreover, plaintiff testified that he was distracted by approaching the busy intersection

and watching for cars. As plaintiff notes, the issue of whether “people on the property would not

discover or realize the danger” of the depression was one of fact. The jury carefully balanced the

evidence and found plaintiff 30% negligent. Thus, it was reasonable for the jury to conclude that

a person walking on the sidewalk would not discover or realize the danger of the depression.

Based on the evidence presented at trial, we cannot say that the evidence so overwhelmingly

favored defendant that no contrary verdict could ever stand. We therefore conclude the trial

court did not err in denying defendant’s motion for a judgment notwithstanding the verdict.

CONCLUSION

The trial judge demonstrated a solid understanding of the collateral source rule and

properly applied it to the collateral source issues in this case. Based on our review of the record,

we find no reversible error with respect to the other issues raised in this appeal. Accordingly, we

-14- affirm the judgment of the circuit court of Bureau County.

Affirmed.

McDADE and O’BRIEN, JJ., concurring.

-15-