Shelter Mutual Insurance Co. v. Bailey

513 N.E.2d 490, 160 Ill. App. 3d 146, 112 Ill. Dec. 76, 1987 Ill. App. LEXIS 3083
CourtAppellate Court of Illinois
DecidedAugust 27, 1987
Docket5-86-0251
StatusPublished
Cited by33 cases

This text of 513 N.E.2d 490 (Shelter Mutual Insurance Co. v. Bailey) 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
Shelter Mutual Insurance Co. v. Bailey, 513 N.E.2d 490, 160 Ill. App. 3d 146, 112 Ill. Dec. 76, 1987 Ill. App. LEXIS 3083 (Ill. Ct. App. 1987).

Opinion

JUSTICE KASSERMAN

delivered the opinion of the court:

The plaintiff, Shelter Mutual Insurance Company (Shelter), filed suit for declaratory judgment, requesting a determination as to whether it was obligated to defend and extend coverage to its named insured, Charles Bailey, one of the defendants. A motion for summary judgment was filed by the plaintiff, and a countermotion for summary judgment was filed by defendant Bailey. The defendant Charles Bailey was also the defendant in an underlying personal injury action brought by a Robert Keniley.

Hearing on the motions for summary judgment was stayed until the underlying lawsuit was resolved. Shelter’s motion for summary judgment was denied. Counterclaimant Charles Bailey’s motion for summary judgment was allowed. Shelter was ordered to pay the attorney fees and defense costs of defendant Charles Bailey’s attorney. From that order, Shelter appeals.

The relevant facts are as follows: On August 28, 1980, Robert Keniley filed a verified complaint alleging that Charles Bailey committed the offense of battery, specifically, “battery in that the above [Charles Bailey] did knowingly, without justification cause bodily harm to Robert E. Keniley in that he struck Robert E. Keniley in the face with his fist, knocking out one of the complainant’s teeth.” On November 6, 1980, Charles Bailey, who was defended by attorney James Stiehl, was found guilty of the offense of battery after a bench trial. Subsequent thereto, on July 10, 1981, Robert Keniley filed a civil suit against Charles Bailey in St. Clair County. The initial complaint alleged that the defendant committed reckless acts resulting in personal injuries to the plaintiff. Shelter Mutual Insurance Company, pursuant to a reservation of rights, retained Robert Schmeider to defend its insured, who defended the underlying suit to its conclusion. A motion to dismiss the original complaint was filed and allowed. An amended complaint, setting forth only allegations of negligence, was filed in September of 1981. From that date until August of 1985, a complaint alleging only negligence was on file against Charles Bailey. Shortly thereafter, the lawsuit was resolved.

Following the filing of the civil lawsuit, attorney Stiehl demanded that Shelter pay his attorney fees for the defense of the underlying personal injury lawsuit along with all necessary costs. Attorney Stiehl had also made this request by letter dated November 17, 1981, to attorney Robert Schmeider. Attorney Schmeider advised attorney Stiehl that inasmuch as the amended complaint did not contain any allegations of intentional tort, a conflict of interest did not exist and, therefore, Shelter was not obligated to pay his attorney fees. Shelter, by letter dated November 30, 1981, reiterated their position and indicated that they had not employed attorney Stiehl to represent the insured and would not pay his fees.

On January 27, 1982, Shelter filed its complaint for declaratory judgment setting forth, in part, that the automobile liability insurance policy issued to the defendant by Shelter provided in part the following exclusion: “Coverages A and B do not apply to: *** (b) Bodily injury or property damage caused intentionally by or at the direction of the insured” and also provided:

“1. COVERAGE A-Bodily Injury Liability; COVERAGE B-Property Damage Liability — The Company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of:
A. Bodily injury sustained by any person;
B. Property damage, including loss of use thereof, sustained by any person; caused by accident ***.”

The complaint for declaratory judgment also set forth a homeowner’s insurance policy issued to the defendant which provided the following exclusions:

“This policy does not apply:
1. Under Coverage E — Personal Liability and Coverage F— Medical Payments to Others:
(f) to bodily injury or property damage which is either expected or intended from the standpoint of the Insured.”

The homeowner’s policy also provided:

“Coverage E-PERSONAL LIABILITY.
This Company agrees to pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury or property damage, to which this insurance applies, caused by an occurrence ***.”

An answer to the complaint for declaratory judgment was filed by both Charles Bailey and Robert Keniley. Charles Bailey filed an affirmative defense setting forth that he had requested the right to control the conduct of the case and that the expenses of his defense be met by the plaintiff, Shelter. Defendant Bailey also filed a counterclaim asserting, pursuant to Maryland Casualty Co. v. Peppers (1976), 64 Ill. 2d 187, 355 N.E. 2d 24, that he was entitled to select an attorney of his own choice. The affirmative defense and counterclaim were denied.

On March 19, 1982, defendant Bailey filed a motion to dismiss the declaratory judgment action. The motion was heard on April 15, 1982, and denied. The court, however, ordered that the action be stayed but that discovery would be permitted to proceed. On May 3, 1982, plaintiff filed a motion to reconsider and moved the court to set aside its stay and, further, filed a motion for summary judgment. Attached to the motion for summary judgment was a certified copy of the criminal court order finding the defendant guilty of battery. A motion for summary judgment was also filed by defendant Bailey. The motion to reconsider the stay of proceedings was denied on March 15, 1983. The matter remained stayed until September 19, 1985, when the motions for summary judgment filed by both plaintiff and defendant were argued. On October 11, 1985, the court entered an order denying plaintiff’s motion for summary judgment. That same order allowed defendant-counterclaimant’s motion for summary judgment and set the case for hearing for defendant Bailey to prove up his attorney fees and costs.

The hearing was conducted on February 11, 1986, on the issue of attorney fees. Attorney James Stiehl testified at the hearing and his time sheet was marked as an exhibit. On examination, attorney Stiehl admitted that the time listed from November 3, 1980, through June 17, 1981, was time he spent on defendant Bailey’s case prior to the filing of the civil suit. The time was attributed in part to the defense of the criminal charge. Attorney Stiehl testified that from September of 1981 through mid-August of 1985, only the cause of action for negligence was pending. In November or December of 1981, he demanded that he be allowed to control the conduct of the case and that his fees be borne by Shelter pursuant to the decision in Maryland Casualty Co. v. Peppers.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Derderian v. Essex Insurance
44 A.3d 122 (Supreme Court of Rhode Island, 2012)
Stoneridge Development v. Essex Insurance
Appellate Court of Illinois, 2008
Stoneridge Development Co. v. Essex Insurance
888 N.E.2d 633 (Appellate Court of Illinois, 2008)
American Family Mutual Insurance v. W.H. McNaughton Builders, Inc.
843 N.E.2d 492 (Appellate Court of Illinois, 2006)
Armstrong Cleaners, Inc. v. Erie Insurance Exchange
364 F. Supp. 2d 797 (S.D. Indiana, 2005)
State Farm Fire & Casualty Co. v. Leverton
732 N.E.2d 1094 (Appellate Court of Illinois, 2000)
State Farm Fire & Casualty Co. v. Martin
710 N.E.2d 1228 (Illinois Supreme Court, 1999)
State Farm Fire & Casualty Co. v. Martin
694 N.E.2d 1058 (Appellate Court of Illinois, 1998)
State Farm Fire & Casualty v. Martin
Appellate Court of Illinois, 1998
Alano v. Industrial Commission
668 N.E.2d 21 (Appellate Court of Illinois, 1996)
Spiegel v. State Farm Fire & Casualty Co.
660 N.E.2d 200 (Appellate Court of Illinois, 1995)
Mike Yang v. Paul Hardin
37 F.3d 282 (Seventh Circuit, 1994)
Old Ben Coal Co. v. Industrial Commission
634 N.E.2d 285 (Appellate Court of Illinois, 1994)
In Re City of Wood Dale
611 N.E.2d 606 (Appellate Court of Illinois, 1993)
Matulis v. Montalbano Builders, Inc.
611 N.E.2d 606 (Appellate Court of Illinois, 1993)
LaSalle National Trust, N.A. v. Schaffner
818 F. Supp. 1161 (N.D. Illinois, 1993)

Cite This Page — Counsel Stack

Bluebook (online)
513 N.E.2d 490, 160 Ill. App. 3d 146, 112 Ill. Dec. 76, 1987 Ill. App. LEXIS 3083, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shelter-mutual-insurance-co-v-bailey-illappct-1987.