{ "id": 1073591, "name": "JEFFREY PERELMAN, Plaintiff-Appellant, v. JACK FISHER et al., Defendants-Appellees", "name_abbreviation": "Perelman v. Fisher", "decision_date": "1998-08-26", "docket_number": "No. 1-97-3217", "first_page": "1007", "last_page": "1013", "citations": [ { "type": "official", "cite": "298 Ill. App. 3d 1007" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "187 Ill. App. 378", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 2854902 ], "year": 1914, "pin_cites": [ { "page": "385-86" } ], "opinion_index": 0, "case_paths": [ "/ill-app/187/0378-01" ] }, { "cite": "525 N.E.2d 539", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1988, "opinion_index": 0 }, { "cite": "170 Ill. App. 3d 765", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3585556 ], "weight": 2, "year": 1988, "pin_cites": [ { "page": "771-72" }, { "page": "775", "parenthetical": "when the insured sued his broker for negligent failure to procure proper insurance and breach of the broker's fiduciary duty, the court held that the insured's failure to read the policy was not an absolute bar to his right to recover against the broker" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/170/0765-01" ] }, { "cite": "345 N.E.2d 49", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1976, "opinion_index": 0 }, { "cite": "36 Ill. App. 3d 595", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 2631453 ], "weight": 2, "year": 1976, "pin_cites": [ { "page": "598" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/36/0595-01" ] }, { "cite": "409 N.E.2d 549", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1980, "opinion_index": 0 }, { "cite": "87 Ill. App. 3d 1106", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3179543 ], "weight": 7, "year": 1980, "pin_cites": [ { "page": "1110" }, { "page": "1110-11" }, { "page": "1110" }, { "page": "1110" }, { "page": "1112" }, { "page": "1111" }, { "page": "1111" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/87/1106-01" ] }, { "cite": "651 N.E.2d 1132", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1995, "opinion_index": 0 }, { "cite": "166 Ill. 2d 72", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 198910 ], "year": 1995, "pin_cites": [ { "page": "84-85" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/166/0072-01" ] }, { "cite": "565 N.E.2d 654", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1990, "opinion_index": 0 }, { "cite": "139 Ill. 2d 501", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 5573900 ], "weight": 2, "year": 1990, "pin_cites": [ { "page": "504" }, { "page": "505" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/139/0501-01" ] }, { "cite": "671 N.E.2d 827", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1996, "opinion_index": 0 }, { "cite": "284 Ill. App. 3d 255", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 1260396 ], "weight": 2, "year": 1996, "opinion_index": 0, "case_paths": [ "/ill-app-3d/284/0255-01" ] } ], "analysis": { "cardinality": 680, "char_count": 16070, "ocr_confidence": 0.748, "pagerank": { "raw": 1.3230249709200312e-07, "percentile": 0.6271761403850186 }, "sha256": "c7a03acda2df5c99ec97902213ead9757a270ec8f51d26762011c12729c9f3b2", "simhash": "1:3bd3d2a26ee955f4", "word_count": 2653 }, "last_updated": "2023-07-14T16:29:38.148323+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "JEFFREY PERELMAN, Plaintiff-Appellant, v. JACK FISHER et al., Defendants-Appellees." ], "opinions": [ { "text": "JUSTICE BURKE\ndelivered the opinion of the court:\nPlaintiff Jeffrey Perelman appeals from the circuit court\u2019s order dismissing his breach of contract and negligent misrepresentation claims against defendants Jack Fisher and Amsterdam Financial Group, Ltd. On appeal, plaintiff contends that: (1) \u201cin an action by an insured against his broker/agent, there is no presumption of knowledge of breach of contract\u201d; (2) the statute of limitations on his claims did not commence until plaintiff knew or reasonably should have known he had been damaged and that the damage was wrongfully caused; and (3) section 2 \u2014 619 of the Civil Practice Law (Act) (735 ILCS 5/2 \u2014 619 (West 1992)) prohibits the trial court from resolving factual questions where the nonmovant has filed a jury demand. For the reasons set forth below, we reverse and remand this case for further proceedings.\nIn September 1988, plaintiff hired defendant, Jack Fisher (Fisher), an insurance broker who owned and operated Amsterdam Financial Group, Ltd., for the purpose of procuring a disability insurance policy. Fisher offered and plaintiff accepted a Paul Revere Life Insurance Company disability insurance policy with a monthly disability benefit of $4,000. The Paul Revere policy was issued to plaintiff on or about January 24, 1989, accompanied by a transmittal letter requesting that plaintiff review the policy and contact Fisher if plaintiff had any questions regarding his coverage.\nThe Paul Revere policy as issued did not contain a provision that would increase the amount of disability payments in order to meet increases in inflation. Fisher stated in a sworn affidavit that he explained to plaintiff prior to the issuance of the policy that it did not contain a cost of living adjustment. However, plaintiff stated in a sworn affidavit that during negotiation of the policy, Fisher told plaintiff that plaintiff was purchasing a \u201cpremier\u201d policy, which was the \u201cbest\u201d policy available at that time. Plaintiff alleged that when the policy was issued to him in January 1989, he \u201cskimmed\u201d through it in order to confirm that the monthly disability benefit was for $4,000 as requested. When plaintiff \u201cskimmed\u201d through the policy, he also observed references to benefit adjustments related to the \u201cConsumer Price Index.\u201d\nAt the time plaintiff purchased and was issued the Paul Revere policy, he was also covered under a separate disability insurance policy issued to him by Minnesota Mutual Life. The Minnesota Mutual Life policy contained a provision entitled, \u201cMonthly Income Benefit Escalator Agreement,\u201d that had the effect of increasing monthly income benefits if the insured suffered an extended period of disability. As specifically outlined in the Minnesota Mutual Life policy, plaintiff paid an additional annual premium for the \u201cBenefit Escalator Agreement.\u201d\nPlaintiff paid all premiums for the Paul Revere policy from January 1989 through March 27, 1993, when plaintiff sustained a heart attack. In November 1993, plaintiff began receiving monthly disability payments under the Paul Revere policy in the amount of $4,800. Plaintiff alleges that when the monthly disability payment he was receiving under the Paul Revere policy did not increase in October 1994, Fisher informed plaintiff that Fisher had not obtained a policy with a provision for an annual increase of the monthly benefit to meet inflation rates.\nOn May 20, 1997, plaintiff filed an amended complaint (complaint) in the trial court. Count I of plaintiffs complaint for breach of contract alleged that Fisher breached his duties to plaintiff by failing to procure and provide a disability policy which contained a provision that would annually increase the payable amount of monthly disability benefits to meet the rate of inflation. Count II of plaintiff\u2019s complaint for negligent misrepresentation alleged that, as defendants\u2019 client, plaintiff reasonably relied to his detriment on Fisher\u2019s representation that the Paul Revere policy would include such a provision.\nDefendants filed a motion to dismiss plaintiffs complaint, arguing that the statute of limitations barred the action because it was filed seven years and two months after plaintiff received the policy. Plaintiff filed a response to defendants\u2019 motion to dismiss, arguing that the court apply the discovery rule and determine that the applicable five-year statute of limitations had not run as a matter of law because there was a genuine issue of material fact as to when plaintiff knew or should have known the terms of the policy. In their reply, defendants argued that when plaintiff received the policy on or about January 24, 1989, he reasonably knew or should have known, for the purpose of commencing the limitations period under the discovery rule, that the policy did not contain a provision for an annual increase of benefits to meet the inflation rate. Therefore, defendants argued, the statute of limitations barred plaintiffs cause of action which accrued on January 24, 1989.\nAt the hearing on defendants\u2019 motion to dismiss, plaintiff argued that his complaint stated a cause of action because there were questions of fact as to whether plaintiff should have known of the alleged defect in the policy when he \u201cskimmed\u201d it in January 1989. For example, plaintiff argued that a jury may determine that when plaintiff saw a reference to the \u201cConsumer Price Index\u201d in the policy, he reasonably could have interpreted that term to provide for the monthly benefit increase he allegedly requested. Defendants argued that there was no question that plaintiff should have known of any alleged deficiency in the policy when he received it because, based on Furtak v. Moffett, 284 Ill. App. 3d 255, 671 N.E.2d 827 (1996), plaintiff clearly had a duty to read and understand the contents of the policy.\nOn August 8, 1997, the trial court found that because the language in the Paul Revere policy was not defective and was clearly set out for plaintiff, the case was \u201cnot a Discovery Rule matter.\u201d Specifically, the court stated:\n\u201cThere\u2019s nothing defective in the policy. It\u2019s not like a fireplace that sets fire to the house at some point later on. It\u2019s nothing that is hidden or defective.\n* * *\nAnd I think that the holder of a policy, whether he or she is suing the broker or the insurance company, has a duty to realize what\u2019s in the policy and what is not.\nTo allow the opposite rule, to allow somebody to say, well, it\u2019s long and it\u2019s complicated would simply do away with the Statute of Limitations and leave brokers or companies liable for years and years and years until some event occurred that triggered some financial shortfall.\u201d\nAccordingly, the trial court dismissed plaintiffs complaint pursuant to section 2 \u2014 619(a)(5) of the Act based on plaintiffs failure to file his complaint within the statute of limitations. This appeal followed.\nPlaintiff contends that \u201cin an action by an insured against his broker/agent, there is no presumption of knowledge of breach of contract.\u201d Specifically, plaintiff argues that the trial court erred in determining as a matter of law that plaintiff was presumed to know and understand the terms of the Paul Revere policy (policy) and that he should have known of the breach at the time he received the policy on January 24, 1989. Plaintiff argues that there are material questions of fact as to when he knew or should have known of the defect in the policy and whether he was contributorily negligent for failing to read and understand the terms of the policy. Defendant contends that the issue here is not whether plaintiff was contributorily negligent in failing to read and understand the policy but, rather, whether plaintiff pleaded sufficient facts to avoid the application of the statute of limitations.\nA trial court should not dismiss an action on the pleadings unless it is clearly apparent that no set of facts can be proven which will entitle the plaintiff to relief. Burdinie v. Village of Glendale Heights, 139 Ill. 2d 501, 504, 565 N.E.2d 654 (1990). When the legal sufficiency of a complaint is challenged by a section 2 \u2014 619 motion to dismiss, all well-pleaded facts and reasonable inferences are accepted as true (Hermitage Corp. v. Contractors Adjustment Co., 166 Ill. 2d 72, 84-85, 651 N.E.2d 1132 (1995)), and a reviewing court must determine whether the allegations set forth in the complaint, interpreted in a light most favorable to the plaintiff, are sufficient to set forth a cause of action upon which relief may be granted. Burdinie, 139 Ill. 2d at 505.\nIllinois courts have repeatedly held that when an insured sues his or her insurer after failing to note a discrepancy between the policy issued and received and the policy requested or expected, the insured will be bound by the contract terms because he or she is under a duty to read the policy and inform the insurer of any discrepancy so that a prompt correction may be made without prejudicing the rights of either party. Black v. Illinois Fair Plan Ass\u2019n, 87 Ill. App. 3d 1106, 1110, 409 N.E.2d 549 (1980). See also Foster v. Crum & Forster Insurance Cos., 36 Ill. App. 3d 595, 345 N.E.2d 49 (1976); Furtak, 284 Ill. App. 3d 255. Although this court has recognized that laymen may not read their insurance policies as common practice, we have not excused plaintiffs from their burden of knowing the contents of the policy when there are no allegations that the language of the policy was ambiguous. Foster, 36 Ill. App. 3d at 598.\nOn the other hand, we have also recognized that there is a distinction between an action by the insured against his insurer, which issues the policy, and an action by an insured against his agent, who procures the policy. Black, 87 Ill. App. 3d at 1110-11. The relationship between an insured and his broker, acting as the insured\u2019s agent, is a fiduciary one. Illinois law places a burden on an insurance broker to exercise competence and skill when he or she renders the service of procuring insurance coverage. Economy Fire & Casualty Co. v. Bassett, 170 Ill. App. 3d 765, 771-72, 525 N.E.2d 539 (1988). If a broker does not follow instructions or if the policy obtained is materially defective through the agent\u2019s fault or if the principal suffers damage due to any mistake or act of commission or omission of the agent which constitutes a breach of duty to the principal, the agent is liable to the principal for any loss sustained thereby. Black, 87 Ill. App. 3d at 1110, citing Evan L. Reed Manufacturing Co. v. Wurts, 187 Ill. App. 378, 385-86 (1914).\nIn Black, the plaintiffs were issued a fire insurance policy that was procured by their agent. In filling out the application form, the broker mistakenly inserted an incorrect address. After \u201cglancing\u201d at the contract but failing to detect the address error, the plaintiff signed the application in blank at the broker\u2019s direction. After a fire occurred on the premises that were intended to be insured by the policy, the insurance company denied liability. The plaintiffs brought an action seeking to recover damages from the broker due to his alleged negligence in obtaining insurance on the wrong property. The trial court held that the plaintiffs were negligent as a matter of law because they failed to note the address error on the face of the policy when they received it. Black, 87 Ill. App. 3d at 1110.\nOn appeal, the Black court found that the broker was not entitled to judgment as a matter of law, stating that the critical difference between insurer-insured cases and broker-insured cases was that in the former, the insured \u201cis attempting to deny the effectiveness of a part of the writing.\u201d Black, 87 Ill. App. 3d at 1112. Therefore, a duty to read the contract and report discrepancies is imposed on the insured. However, a suit between the insured and his broker \u201cdoes not depend upon a modification of the terms of the written contract to the prejudice of the insurer\u201d but, rather, involves only a matter of proof that the broker negligently performed his duty to procure a specified insurance policy. Black, 87 Ill. App. 3d at 1111. The Black court held that, in the latter case, \u201cthe insured\u2019s failure to read the contract and point out errors in its basic terms, while arguably evidence of the insured\u2019s contributory negligence [citations], is never contributory negligence as a matter of law.\u201d Black, 87 Ill. App. 3d at 1111. See also Bassett, 170 Ill. App. 3d at 775 (when the insured sued his broker for negligent failure to procure proper insurance and breach of the broker\u2019s fiduciary duty, the court held that the insured\u2019s failure to read the policy was not an absolute bar to his right to recover against the broker).\nIn the present case, plaintiff argues, based on Black, that his alleged failure to read and know the terms of the policy and to bring discrepancies to the attention of defendants is, at best, some evidence of contributory negligence, but not contributory negligence as a matter of law. Because knowledge of the alleged breach by the plaintiff here, as in Black, cannot be imputed or presumed, the trial court should not have determined as a matter of law that plaintiff knew or reasonably should have known of the Paul Revere policy deficiency when he received the policy in January 1989. Plaintiff pled facts in his complaint which, when construed in a light most favorable to him, created a genuine issue of material fact as to whether defendants breached their fiduciary duty as brokers in procuring the policy, i.e., plaintiff\u2019s allegation that Fisher told him that the policy was a \u201cpremier\u201d policy, which was the \u201cbest\u201d policy available at the time. We find, therefore, that the trial court erred in granting defendants\u2019 section 2 \u2014 619 motion to dismiss because a genuine issue of material fact existed as to when plaintiff knew or should have known that the policy was defective. Based upon Black and Bassett, we find that the trial court erred in holding as a matter of law that plaintiff had a duty to \u201crealize what\u2019s in the policy and what is not,\u201d regardless of \u201cwhether [plaintiff] is suing the broker or the insurance company.\u201d\nWe briefly note that we find no merit in defendants\u2019 argument that Black is \u201cclearly distinguishable\u201d from the case at bar because the issue in this case was not whether plaintiff was contributorily negligent but, rather, whether plaintiff pled facts to avoid strict application of the statute of limitations. The Black holding \u2014 that the trial court had not properly considered the issue of the insureds\u2019 reliance on their broker by holding as a matter of law that the insureds had a duty to read the policy \u2014 applies regardless of the specific \u201cissue\u201d before the trial court.\nIn accordance with our holding that an insured\u2019s failure to read and understand the terms of a policy procured by his broker is not an absolute bar to the insured\u2019s right to recover against his broker for breach of the broker\u2019s fiduciary duty, we also find that the trial court erred in dismissing plaintiffs complaint as untimely under the statute of limitations because the question of when the limitations period began could not be determined until the question of when plaintiff should have known of the alleged deficiency in the policy was determined by the trier of fact. Accordingly, we reverse the trial court\u2019s order dismissing plaintiffs complaint and remand this cause for further proceedings consistent with this order. In light of our decision, we need not address plaintiffs remaining argument that section 2 \u2014 619 of the Act prohibits the trial court from resolving factual questions where the nonmovant has filed a jury demand.\nReversed and remanded.\nLEAVITT, EJ., and CAHILL, J., concur.", "type": "majority", "author": "JUSTICE BURKE" } ], "attorneys": [ "Hilfman & Fogel, EC., of Chicago (Robert L. Fogel, of counsel), for appellant.", "Tribler, Orpett & Crone, EC., of Chicago (Steven R. McMannon and Matthew B. Parker, of counsel), for appellees." ], "corrections": "", "head_matter": "JEFFREY PERELMAN, Plaintiff-Appellant, v. JACK FISHER et al., Defendants-Appellees.\nFirst District (3rd Division)\nNo. 1\u201497\u20143217\nOpinion filed August 26, 1998.\nHilfman & Fogel, EC., of Chicago (Robert L. Fogel, of counsel), for appellant.\nTribler, Orpett & Crone, EC., of Chicago (Steven R. McMannon and Matthew B. Parker, of counsel), for appellees." }, "file_name": "1007-01", "first_page_order": 1027, "last_page_order": 1033 }