Valdez v. Illinois Casualty Company

2022 IL App (1st) 201121-U
CourtAppellate Court of Illinois
DecidedAugust 1, 2022
Docket1-20-1121
StatusUnpublished

This text of 2022 IL App (1st) 201121-U (Valdez v. Illinois Casualty Company) 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
Valdez v. Illinois Casualty Company, 2022 IL App (1st) 201121-U (Ill. Ct. App. 2022).

Opinion

2022 IL App (1st) 201121-U FIRST DISTRICT, FIRST DIVISION August 1, 2022

No. 1-20-1121

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1). _____________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT _____________________________________________________________________________

ORLANDO VALDEZ, ) Appeal from the ) Circuit Court of Plaintiff-Appellant, ) Cook County, Illinois. ) v. ) No. 16 CH 016015 ) ILLINOIS CASUALTY COMPANY, ) Honorable ) Anna M. Loftus, Defendant-Appellee. ) Judge Presiding. _____________________________________________________________________________

JUSTICE COGHLAN delivered the judgment of the court. Presiding Justice Hyman and Justice Pucinski concurred in the judgment.

ORDER

¶1 Held: (1) Plaintiff did not state a claim that the defendant insurer had a duty to settle the underlying action where he did not allege facts establishing that an excess judgment was reasonably probable. (2) Plaintiff did not allege facts establishing a conflict of interest between the insurer and its insureds. (3) Plaintiff was not entitled to damages under section 155 of the Insurance Code for insurer’s allegedly “vexatious and unreasonable” actions.

¶2 Plaintiff Orlando Valdez was injured in an altercation at the Aquarius Club and

Restaurant and brought a personal injury lawsuit against the club’s owner Roman Rojas and

Rojas 2459 Club, Inc. (collectively Rojas). Rojas was insured by defendant Illinois Casualty

Company (ICC) with a policy limit of $1,000,000. Valdez made a settlement offer of $1,000,000 No. 1-20-1121

which ICC rejected. Following a jury trial, Valdez won a judgment of $2,000,000 (Valdez v.

Rojas 2459 Club, Inc., d/b/a Aquarius Club and Restaurant, No. 13 L 8704 (Cir. Ct. Cook

County, April 11, 2016)), and ICC tendered the policy limit of $1,000,000 to Valdez.

¶3 As part of a postjudgment settlement agreement, Rojas assigned any potential claims he

had against ICC to Valdez. Valdez then brought the instant suit against ICC, alleging that ICC

breached its duty of good faith and fair dealing toward its insured by not accepting a settlement

offer within the policy limits despite the likelihood of an excess judgment. Valdez sought to

recover the excess judgment plus costs, interest, and statutory damages for ICC’s allegedly

“vexatious and unreasonable” behavior. On October 7, 2020, the trial court granted ICC’s section

2-615 motion to dismiss Valdez’s fourth amended complaint. We affirm.

¶4 BACKGROUND

¶5 The Underlying Lawsuit

¶6 On September 9, 2012, at around 3 a.m., Valdez was at the Aquarius Club when an

unidentified male assailant threw a beer bottle at his face. The glass from the bottle “cut

[Valdez’s] right eye in half” and permanently blinded him in that eye. The assailant fled the

scene and was not apprehended by the club’s security guards.

¶7 Valdez brought a personal injury lawsuit against Rojas, the unidentified assailant,

unknown Aquarius Club employees and security guards, Lucio Solis, and the King and Lord

Corporation.1 In the underlying complaint, Valdez alleged that Rojas “was in charge of hiring,

training and managing Aquarius Club’s security.” On at least one occasion prior to September 9,

2012, the assailant committed acts of violence at the club, and Rojas was aware of this fact.

1 The underlying complaint alleged that Solis, as agent for King and Lord, was in the business of providing security personnel for the club, and two of King and Lord’s personnel were on security detail at the club when the incident occurred. -2- No. 1-20-1121

Nevertheless, Rojas, through his agents and employees, allowed the assailant to enter the club on

September 9, 2012, and served him alcoholic drinks.

¶8 Valdez further alleged that at around 3 a.m. on September 9, 2012, “immediately prior

to” his injury, a fight broke out between two female patrons at the club, and the assailant threw a

beer bottle at a waitress, striking her in the leg. Club security did not intervene or restrain the

assailant, who proceeded to throw a bottle at Valdez, causing his injury. Valdez alleged that

Rojas was negligent in failing to take reasonable action to protect him against the assailant’s

misconduct.

¶9 ICC undertook Rojas’ defense, and the case was set for a jury trial on April 4, 2016. On

March 29, 2016, Valdez sent ICC a letter stating:

“Based on [ICC’s] answers to written discovery that show primary insurance

coverage policy limits of $1,000,000.00, we hereby demand settlement on behalf of

Orlando Valdez in the amount of One Million Dollars.

In the event that Illinois Casualty Company determines to reject this offer, please

be advised that we shall seek full satisfaction of any excess judgment against defendant,

Roman Rojas, and/or Illinois Casualty Company.”

¶ 10 On April 5, 2016, ICC rejected Valdez’s settlement demand and offered to settle for

$100,000. ICC increased its offer to $200,000 “on the moment of the verdict.” Valdez did not

accept. On April 11, 2016, the jury returned a verdict of $2,000,000 in favor of Valdez and

against Rojas, with a special finding that the unknown assailant’s criminal act was reasonably

foreseeable to Rojas. ICC filed a posttrial motion which it withdrew on November 3, 2016. On

November 14, 2016, ICC paid Valdez the policy limit of $1,000,000 but did not tender the

remainder of the judgment, costs, or interest.

-3- No. 1-20-1121

¶ 11 Meanwhile, on November 8, 2016, Valdez and Rojas executed an agreement whereby

Valdez agreed not to enforce the remaining judgment against Rojas in exchange for Rojas

assigning to Valdez any claims that he had against ICC as a result of the judgment in the

underlying suit. Valdez additionally executed a “Partial Satisfaction and Partial Release of

Judgment” in which he acknowledged receiving $1,000,000 in partial satisfaction of the

judgment and stated:

“Subject to the Assignment executed by the parties ***, nothing in this document affects

Orlando Valdez’s right to seek full satisfaction of the amount remaining on the judgment

on April 11, 2016; to wit: ONE MILLION DOLLARS and NO/CENTS ($1,000,000.00)

from Illinois Casualty Company.”

¶ 12 The Present Action

¶ 13 Valdez filed the present action against ICC on December 12, 2016. In his fourth amended

complaint 2, filed on November 11, 2019, he alleged that ICC (1) breached its duty of good faith

and fair dealing toward its insured by rejecting his settlement demand, (2) waived the policy

limits by failing to send Rojas a reservation of rights letter after Valdez made his settlement

demand, and (3) committed “vexatious and unreasonable” actions in violation of section 155 of

the Insurance Code (215 ILCS 5/155 (West 2016)).

¶ 14 Valdez stated that once he made his March 26, 2016 demand to settle for the policy limit

of $1,000,000, ICC had a duty to settle because of the likelihood that Rojas would be found

liable for an amount exceeding the policy limit. In support, Valdez alleged that discovery in the

underlying suit showed that Rojas hired, trained, and managed the club’s security personnel.

Additionally, Rojas knew that the assailant had previously committed acts of violence at the

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2022 IL App (1st) 201121-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/valdez-v-illinois-casualty-company-illappct-2022.