Waste Management, Inc. v. International Surplus Lines Insurance

579 N.E.2d 322, 144 Ill. 2d 178, 161 Ill. Dec. 774, 1991 Ill. LEXIS 35
CourtIllinois Supreme Court
DecidedMay 20, 1991
Docket70958
StatusPublished
Cited by273 cases

This text of 579 N.E.2d 322 (Waste Management, Inc. v. International Surplus Lines Insurance) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Waste Management, Inc. v. International Surplus Lines Insurance, 579 N.E.2d 322, 144 Ill. 2d 178, 161 Ill. Dec. 774, 1991 Ill. LEXIS 35 (Ill. 1991).

Opinions

JUSTICE FREEMAN

delivered the opinion of the court:

Plaintiffs, Waste Management, Inc., and Chemical Waste Management, Inc. (insureds), and Matthew Cockrell (Cockrell), legal counsel for insureds, appeal from certain discovery orders and a finding of contempt for noncompliance with those orders.

BACKGROUND

International Surplus Lines Insurance Company and American Risk Insurance Company (insurers) issued certain policies of insurance (EIL policies) to insureds. The policies provide indemnity to insureds for defense costs for any claim arising out of an environmental impairment brought against insureds by third parties. Insurers’ duty to indemnify is subject to certain exclusions and conditions, including insureds’ duty to cooperate. Additionally, the policies provide insurers the right, but not the duty, to defend such a claim.

Insureds owned and operated five hazardous waste disposal sites which were the subject of several lawsuits. The current case involves only the litigation with respect to the site located in Furley, Kansas (the Miller litigation). In the MHler litigation, which was commenced in January 1982 in the United States District Court for the District of Kansas, the plaintiffs alleged that insureds were responsible for personal injury and property damage arising from the migration of toxic wastes.

During the pendency of the Miller litigation, on October 1, 1982, prior owners of the Furley, Kansas, site filed suit against insureds (the Nunn litigation). Insureds counterclaimed, alleging negligent design, construction and operation of the site. Insureds obtained a judgment against the prior owners in the amount of $10,675,342.17 and subsequently settled with certain of the prior owners for $1,500,000.

Insureds retained counsel, defended and settled the Miller lawsuit. Pursuant to the EIL policies, insureds subsequently sought indemnification from insurers for $2,150,000 in settlement costs and $850,000 in defense costs. Insurers denied coverage.

FACTS

Both insureds and insurers filed declaratory judgment actions seeking a determination of their respective rights and liabilities under the polices. The actions were consolidated. In their complaint, insureds alleged that they had performed all of their obligations and conditions precedent under the terms of the EIL policies. Further, insureds alleged that the settlement and defense costs incurred in the Miller litigation were reasonable and that the settlement was necessary. Additionally, insureds alleged that insurers had received advance notification of the settlement and agreed not to contest its reasonableness.

In their answer, insurers denied coverage, and further denied that insureds had met all of their contractual obligations and conditions precedent. Insurers admitted sending a letter to insureds agreeing not to contest the Miller settlement, but asserted that the letter was “based on information then known to it.” In their complaint, insurers alleged that one reason for their denial of coverage for the Miller litigation was insureds’ failure to advise them of the Nunn litigation. This, insurers maintain, constituted a breach of the cooperation clause and other conditions of the policy.

During discovery, insurers requested production of defense counsel’s files in the underlying Miller and Nunn litigations. (134 Ill. 2d R. 214.) Insureds produced some of the requested documents from the Miller litigation, but withheld certain others, claiming attorney-client and work-product privileges. None of the Nunn litigation files were produced. Insureds provided the court with a detailed log of the withheld documents.

The court ordered production of the Miller litigation files, but denied insurers’ request for production of the Nunn files. Cockrell, in order to perfect an appeal to the appellate court, refused production of the additional files from the Miller litigation. He was held in contempt and fined $100. (134 Ill. 2d R. 219(c).) Both parties appealed to the appellate court, first district.

The appellate court, in a unanimous decision, affirmed in part and reversed in part the circuit court’s order to produce the Miller litigation files; reversed the order denying production of the Nunn litigation files; and ordered an in camera inspection of all requested documents. (203 Ill. App. 3d 172.) We granted insureds’ petition for leave to appeal (107 Ill. 2d R. 315). We affirm in part and reverse in part.

Two issues are presented for our review: (1) whether jurisdiction is proper and (2) whether attorney-client privilege or the work-product doctrine may bar discovery of the attorney’s files in the underlying lawsuits. The parties have agreed that resolution of the privilege issues regarding the documents generated in connection with the Miller litigation will govern the parameters of production for defense documents from all sites involved in the coverage litigation.

JURISDICTION

Insurers first contend that this court is without subject matter jurisdiction to hear Cockrell’s appeal. They point out that the contempt order was levied against Cockrell, not insureds, yet the notice of appeal was filed on behalf of insureds, not Cockrell. Therefore, insurers argue, the contempt order is not properly before us and further, since discovery orders are not final and appealable, this court lacks jurisdiction.

Our Rule 303(c) provides for the form and content of the notice of appeal. (134 Ill. 2d R. 303(c).) Notice of appeal serves the dual purpose of vesting the reviewing court with jurisdiction (Dunaway v. Ashland Oil, Inc. (1989) , 189 Ill. App. 3d 106, 110; Thorsen v. City of Chicago (1979), 74 Ill. App. 3d 98, 104), and informing the prevailing party that the unsuccessful litigant seeks review by a higher court (Burtell v. First Charter Service Corp. (1979), 76 Ill. 2d 427, 433). Thus, notice must necessarily specify the judgment or part thereof from which the appeal is taken (134 Ill. 2d R. 303(c)(2)), and accordingly, a reviewing court has jurisdiction solely over those issues properly raised in the notice (Smock v. Hale (1990), 197 Ill. App. 3d 732, 737; Lewanski v. Lewanski (1978), 59 Ill. App. 3d 805, 815). It is our preference that cases presented for our review be resolved on the merits, and to that end, notice requirements are given a liberal construction (March v. Miller-Jesser, Inc. (1990), 202 Ill. App. 3d 148, 157). Mere technical defects in form, as opposed to substance, are deemed not fatal. Burtell, 76 Ill. 2d at 434.

We have reviewed the notice of appeal in this case. The notice states, inter alia, that the insureds appeal from the September 11, 1989, order which found Cockrell, counsel for plaintiffs, in contempt of court for his refusal to comply with the court’s August 25, 1989, order to produce certain documents. Although Cockrell is not formally named in the caption portion of the notice, insurers were adequately apprised that Cockrell and insureds were seeking review of the contempt finding as well as the underlying discovery order. Further, review of the contempt finding necessarily requires review of the order upon which it is based. (See People ex rel. Scott v. Silverstein (1981), 87 Ill. 2d 167, 174.) Insurers claim no prejudice as a result of insureds’ apparent inadvertent omission of Cockrell’s name in the notice and we perceive none.

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

Related

In re Marriage of Nguyen
2023 IL App (1st) 221045-U (Appellate Court of Illinois, 2023)
Dameron v. Mercy Hospital & Medical Center
2020 IL 125219 (Illinois Supreme Court, 2020)
Ross v. Illinois Central R.R. Co.
2019 IL App (1st) 181579 (Appellate Court of Illinois, 2019)
Robert R. McCormick Foundation v. Arthur J. Gallagher Risk Management Services, Inc
2018 IL App (2d) 170939 (Appellate Court of Illinois, 2018)
Selby v. O'Dea
2017 IL App (1st) 151572 (Appellate Court of Illinois, 2018)
Motorola Solutions, Inc. v. Zurich Insurance Co.
2017 IL App (1st) 161465 (Appellate Court of Illinois, 2017)
Motorola Solutions v. Zurich Insurance Company
2017 IL App (1st) 161465 (Appellate Court of Illinois, 2017)
Eizenga v. Unity Christian School of Fulton, Illinois
2016 IL App (3d) 150519 (Appellate Court of Illinois, 2016)
Kim v. Song
2016 IL App (1st) 150614 (Appellate Court of Illinois, 2016)
Doe v. Township High School District 211
2015 IL App (1st) 140857 (Appellate Court of Illinois, 2015)
American Access Casualty Company v. Alassouli
2015 IL App (1st) 141413 (Appellate Court of Illinois, 2015)
Borgwarner, Inc. v. Kuhlman Electric Corporation
2014 IL App (1st) 131824 (Appellate Court of Illinois, 2015)
Bryant v. Sagamore Insurance Company
597 F. App'x 968 (Tenth Circuit, 2015)
People v. Radojcic
2013 IL 114197 (Illinois Supreme Court, 2013)
Holland v. Schwan's Home Service, Inc.
2013 IL App (5th) 110560 (Appellate Court of Illinois, 2013)
Center Partners, Ltd. v. Growth Head GP, LLC
2012 IL 113107 (Illinois Supreme Court, 2012)
Janousek v. Slotky
2012 IL App (1st) 113432 (Appellate Court of Illinois, 2012)
MDA City Apartments v. DLA Piper
2012 IL App (1st) 111047 (Appellate Court of Illinois, 2012)
Hartz Const. v. Village of Western Springs
965 N.E.2d 1159 (Appellate Court of Illinois, 2012)

Cite This Page — Counsel Stack

Bluebook (online)
579 N.E.2d 322, 144 Ill. 2d 178, 161 Ill. Dec. 774, 1991 Ill. LEXIS 35, Counsel Stack Legal Research, https://law.counselstack.com/opinion/waste-management-inc-v-international-surplus-lines-insurance-ill-1991.