{ "id": 2807235, "name": "STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff and Counterdefendant-Appellee, v. TIMOTHY MURPHY et al., Defendant and Counterplaintiff-Appellant", "name_abbreviation": "State Farm Mutual Automobile Insurance v. Murphy", "decision_date": "1976-06-03", "docket_number": "No. 75-140", "first_page": "709", "last_page": "713", "citations": [ { "type": "official", "cite": "38 Ill. App. 3d 709" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "284 So. 2d 442", "category": "reporters:state_regional", "reporter": "So. 2d", "case_ids": [ 9755900 ], "opinion_index": 0, "case_paths": [ "/so2d/284/0442-01" ] }, { "cite": "510 S.W.2d 633", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 10132879 ], "year": 1973, "opinion_index": 0, "case_paths": [ "/sw2d/510/0633-01" ] }, { "cite": "269 N.E.2d 295", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1974, "opinion_index": 0 }, { "cite": "48 Ill. 2d 1", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 2907350 ], "opinion_index": 0, "case_paths": [ "/ill-2d/48/0001-01" ] }, { "cite": "244 N.E.2d 827", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "105 Ill. App. 2d 408", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 1598872 ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/105/0408-01" ] }, { "cite": "254 N.E.2d 440", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "44 Ill. 2d 127", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 2891486 ], "opinion_index": 0, "case_paths": [ "/ill-2d/44/0127-01" ] }, { "cite": "504 S.W.2d 633", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 10130829 ], "weight": 2, "year": 1969, "opinion_index": 0, "case_paths": [ "/sw2d/504/0633-01" ] }, { "cite": "259 N.E.2d 83", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "123 Ill. App. 2d 401", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 1580209 ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/123/0401-01" ] }, { "cite": "221 A. 2d 920", "category": "reporters:state_regional", "reporter": "A.2d", "case_ids": [ 8104813 ], "opinion_index": 0, "case_paths": [ "/a2d/221/0920-01" ] }, { "cite": "232 N.E.2d 155", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1966, "opinion_index": 0 }, { "cite": "88 Ill. App. 2d 343", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 8499378 ], "year": 1966, "opinion_index": 0, "case_paths": [ "/ill-app-2d/88/0343-01" ] }, { "cite": "376 F.2d 157", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 2031480 ], "opinion_index": 0, "case_paths": [ "/f2d/376/0157-01" ] }, { "cite": "279 N.Y.S. 2d 128", "category": "reporters:state", "reporter": "N.Y.S.2d", "year": 1967, "opinion_index": 0 }, { "cite": "27 App. Div. 2d 795", "category": "reporters:state", "reporter": "A.D.2d", "case_ids": [ 5562641 ], "year": 1967, "opinion_index": 0, "case_paths": [ "/ad2d/27/0795-01" ] } ], "analysis": { "cardinality": 504, "char_count": 8956, "ocr_confidence": 0.819, "pagerank": { "raw": 1.1720433780037759e-07, "percentile": 0.5866533145368706 }, "sha256": "6fd36e85d6e583ff62b79974b9c87d2772291fa5faaf93d92dd3dbd9a98aec68", "simhash": "1:23f721dd790fd6a7", "word_count": 1483 }, "last_updated": "2023-07-14T15:32:42.628819+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff and Counterdefendant-Appellee, v. TIMOTHY MURPHY et al., Defendant and Counterplaintiff-Appellant." ], "opinions": [ { "text": "Mr. JUSTICE HALLETT\ndelivered the opinion of the court:\nJoseph Picchi, one of four persons injured in a three-car collision, seeks to hold the State Farm Mutual Automobile Insurance Company liable either on a $100,000 per accident policy which it had issued to the driver at fault (although it had paid out the limits of that policy to other claimants) or under the \u201cuninsured motorist\u201d coverage in his father\u2019s policy. The lower court ruled that the insurer had no obligation to him under either policy. We agree and affirm.\nThere is no dispute as to the facts in this case. On July 19,1970, Timothy Murphy, while driving, was involved in a three-car collision. Mr. Picchi was one of the passengers in Murphy\u2019s automobile. Four persons were injured.\nAt the time of the accident, Timothy Murphy was insured by State Farm under an automobile liability policy which provided limits of *50,000 per person and *100,000 per occurrence. Joseph Picchi\u2019s father also had a State Farm automobile liability policy which, as required by Illinois law, afforded coverage for injuries caused by \u201cuninsured\u201d motor vehicles. Since Joseph Picchi was a member of his father\u2019s household, he was included in this coverage.\nAs a result of the accident, four claims were made against Timothy Murphy. One claim was settled for *200; another was settled during the course of trial for *50,000 and a third was settled after judgment (for *50,000 compensatory damages and *5,000 punitive damages) for *49,800. These payments exhausted the policy limits of Murphy\u2019s policy.\nOn April 10, 1972, less than a month before the last two settlements, Joseph Picchi filed suit against Timothy Murphy and another driver for the injuries he had suffered in the 1970 accident. Since the entire *100,000 \u201cper occurrence\u201d limit of Murphy\u2019s policy had been paid out, State Farm, reserving its rights to deny liability, obtained counsel to defend Murphy in the tort action and, through separate counsel, filed a declaratory judgment action contending:\n1. That there were no sums still payable under its policy issued to Timothy Murphy since the policy limits had been exhausted; and\n2. That, since the policy limits had been exhausted, it had no duty to defend Timothy Murphy in any pending or subsequent lawsuits for damages arising out of the July 19, 1970, accident.\nJoseph Picchi was named as an additional defendant in the declaratory judgment action and he filed a counterclaim, praying for a declaration that he was covered under the uninsured motor vehicle coverage of his father\u2019s policy. Apparently the driver Murphy did not enter an appearance in the action.\nThe court, after hearing arguments and filing a well-reasoned opinion, granted the plaintiff the relief prayed for, and denied Picchi\u2019s counterclaim.\nBefore turning to the contentions of the parties on appeal, we note that the defendant Murphy did not answer the complaint and did not appeal. Accordingly, the issue of the insurer\u2019s duty to defend Murphy, or pay for the costs of defense, is not before the court. The fact that an insurer does not have a duty to pay a claim does not necessarily mean that it has no duty to defend. 7A Appleman, Insurance Law and Practice \u00a7\u00a74684, 4685, 4691 (1962).\nThe appellant, who is not the insured under Murphy\u2019s policy but only the injured party, contends first that, the insurer has an obligation to its insured to exercise diligence and to act in good faith in settling all claims against the insured, and that it is therefore not exonerated merely because it has paid out its policy limits.\nThe insurer is given the right both by policy and by statute to settle claims against its insured. (7A Appleman, Insurance Law and Practice \u00a74711 (1962); Motor Vehicle Code section 7 \u2014 317(f), Ill. Rev. Stat. 1973, ch. 95M, par. 7 \u2014 317(f).) And it is provided in the statute that as long as the settlement is made in good faith the amount of the settlement is subtracted from the amount of the policy limits. This is true even though there are several claimants, as the insurer has the right to settle claims in good faith even though such payments exhaust the policy limits of the insured\u2019s policy so that a subsequent judgment creditor cannot collect on the policy. (8 Appleman, Insurance Law and Practice \u00a74892 (1962).) The insurer is not exonerated if the prior settlements were not in good faith (Obad v. Allstate Insurance Co. (1967), 27 App. Div. 2d 795, 279 N.Y.S. 2d 128), or if the insurer in some other way, such as a failure to inform the insured of the danger of excess liability, breached its duty of good faith towards its insured (Fireman's Fund Insurance Co. v. Santoro (1st Cir. 1967), 376 F.2d 157). However, the defendant Picchi has neither alleged that the insurer acted in bad faith or introduced any evidence tending to so prove. Yet it is for the insured or the judgment creditor who is attempting to collect beyond the policy limits to prove that the insurer acted in bad faith. (Powell v. Prudence Mutual Casualty Co. (1967), 88 Ill. App. 2d 343, 232 N.E.2d 155.) Where no bad faith is alleged or shown, it is presumed that an insurer acted in good faith and within its rights under its policy in settling with an injured party. Early Settlers Insurance Co. v. Schweid (D.C. App. 1966), 221 A. 2d 920 (suit for contribution).\nThe insurance company also contends, citing Yelm v. Country Mutual Insurance Co. (1970), 123 Ill. App. 2d 401, 259 N.E.2d 83, that Picchi, being only an injured party and not an insured, has no standing to question the manner in which the plaintiff discharged its obligations to Murphy. That case, which merely held that a judgment creditor cannot seek to recover the amounts over the policy limits on the basis of the insurer\u2019s bad faith or negligent failure to settle absent an assignment by the insured of his cause of action, is not in point here. The insurer here sought a declaration that it was not liable under its policy to Picchi although the accident was covered by the policy. This nonliability was dependent on the fact that it had already paid out the limits of the policy in good faith. Accordingly, the defendant-counterplaintiff was entitled to have raised the issue of good faith below. He did not and therefore cannot raise it on appeal.\nThe appellant\u2019s second contention is that, since he cannot recover under Murphy\u2019s policy, Murphy was \u201cuninsured\u201d as to him and that he therefore can recover under the \u201cuninsured motorist\u201d coverage of his father\u2019s policy.\n\u201cUninsured\u201d does not mean \u201cunderinsured\u201d as long as the tortfeasor\u2019s policy met the minimum statutorily required limits (Kemp v. Fidelity & Casualty Co. (Tex. Civ. App. 1973), 504 S.W.2d 633), and the insured cannot recover from his own insurer simply because the tortfeasor\u2019s insurance, while sufficient to meet the minimum statutory requirements, is insufficient to satisfy his judgment. Smiley v. Estate of Toney (1969), 44 Ill. 2d 127, 254 N.E.2d 440, where our Supreme Court through Mr. Justice Schaefer, at page 132, said:\n\u201c\u00b0 * * As we read the statute, mandatory coverage is required only up to the amounts required by the financial responsibility law. The cases that have permitted recovery under uninsured motorists clauses although the tortfeasor was actually insured, were cases in which the latter was insured in an amount less than that required by the applicable financial responsibility law.\u201d\nThe counterplaintiff seeks to distinguish Smiley on the basis that there the insured did recover *10,000 from the tortfeasor\u2019s insurer. The court in Smiley, however, did not make the distinction. The purpose of the statute is to require that a minimum amount of insurance be available to an injured insured which would place him in substantially the same position he would have occupied had the tortfeasor complied with the minimum requirements of the Financial Responsibility Act (Ullman v. Wolverine Insurance Co. (1969), 105 Ill. App. 2d 408, 244 N.E.2d 827, aff\u2019d, 48 Ill. 2d 1, 269 N.E.2d 295.) Here that basic insurance protection did exist, although the insured, because of the existence of other claimants, did not benefit from it. Accordingly, the motorist was not uninsured and Picchi cannot recover from his own insurer. Villarreal v. Texas Farmers Insurance Co. (Tex. Civ. App. 1974), 510 S.W.2d 633; Kemp v. Fidelity & Casualty Co. (Tex. Civ. App. 1973), 504 S.W.2d 633, error refused, n.r.e.; Golphin v. Home Indemnity Co. (Fla. App. 1973), 284 So. 2d 442.\nFor the foregoing reasons the judgment is affirmed.\nAffirmed.\nGUILD, P. J., and SEIDENFELD, J., concur.", "type": "majority", "author": "Mr. JUSTICE HALLETT" } ], "attorneys": [ "E. T. Cunningham, of Chicago, for appellant.", "Ross P. Toran and Carl F. Schroeder, both of Querrey, Harrow, Gulanick & Kennedy, of Wheaton, for appellee." ], "corrections": "", "head_matter": "STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff and Counterdefendant-Appellee, v. TIMOTHY MURPHY et al., Defendant and Counterplaintiff-Appellant.\nSecond District (1st Division)\nNo. 75-140\nOpinion filed June 3, 1976.\nE. T. Cunningham, of Chicago, for appellant.\nRoss P. Toran and Carl F. Schroeder, both of Querrey, Harrow, Gulanick & Kennedy, of Wheaton, for appellee." }, "file_name": "0709-01", "first_page_order": 737, "last_page_order": 741 }