                                2013 IL 115860

                             IN THE
                        SUPREME COURT
                               OF
                      THE STATE OF ILLINOIS


                        (Docket No. 115860)
     ROY DEAN ROGERS II et al., Appellees, v. GANI IMERI, Indiv.
            and d/b/a Johnny’s Bar and Grill, Appellant.

                       Opinion filed November 21, 2013.

        JUSTICE THEIS delivered the judgment of the court, with
     opinion.
        Chief Justice Garman and Justices Freeman, Thomas, Kilbride,
     Karmeier, and Burke concurred in the judgment and opinion.



                                   OPINION

¶1       The sole issue in this appeal is whether, in a Dramshop Act case
     where a bar owner is defended by the Illinois Insurance Guaranty
     Fund (the Fund), the reduction for “other insurance” recoveries under
     section 546(a) of the Illinois Insurance Code (hereinafter, the
     Guaranty Fund statute) (215 ILCS 5/546(a) (West 2012)) applies
     against the jury’s verdict or against the bar owner’s maximum
     statutory liability. The trial court decided that the issue was premature
     because the plaintiffs, Roy and Theresa Rogers, had not obtained a
     verdict against the defendant, Gani Imeri. But the trial court certified
     a question to the appellate court pursuant to Supreme Court Rule
     308(a). Ill. S. Ct. R. 308(a) (eff. Feb. 26, 2010). The appellate court
     held that the reduction should be applied against the jury’s verdict.
     2013 IL App (5th) 110546.
¶2       For the reasons that follow, we reverse and remand for further
     proceedings.
¶3                               BACKGROUND
¶4       In 2009, a vehicle driven by 18-year-old Roy Dean Rogers III and
     a vehicle driven by 60-year-old John Winterrowd were involved in a
     head-on collision on a rural highway in Effingham County.
     Winterrowd was intoxicated, and Rogers was not. Rogers died in the
     accident. His parents received $26,550 from Winterrowd’s
     automobile liability insurer and $80,000 from their own automobile
     liability insurer—a total of $106,550. They subsequently filed a six-
     count complaint under the Dramshop Act against Imeri, the owner of
     the bar where Winterrowd was drinking, seeking recovery for their
     son’s personal injury and their loss of society.
¶5       At the time the accident occurred, Imeri maintained a dramshop
     liability policy with Constitutional Casualty Company. The policy
     provided a policy limit of $130,338.51, the statutory cap under the
     Dramshop Act. See generally 235 ILCS 5/6-21(a) (West 2012). While
     this case was pending, Imeri’s insurer was declared insolvent and
     liquidated, and the Fund assumed his defense.
¶6       Imeri filed a “motion for summary adjudication of the amount that
     liability must be reduced” under section 546(a). In that motion, Imeri
     sought a ruling that his maximum liability was $23,788.51, which
     represented the difference between the statutory cap on dramshop
     liability and the other insurance proceeds. The Rogerses responded
     that the setoff for other insurance proceeds should come after the
     jury’s verdict. The trial court denied Imeri’s motion as premature,
     commenting that such a ruling would “invade the jury’s role as finder
     of fact.” The court noted that, if the jury should find in favor of the
     Rogerses, Imeri would have an opportunity to request setoffs.
¶7       Imeri filed a motion to reconsider that ruling or, in the alternative,
     to certify a question under Rule 308(a). The Rogerses agreed to the
     request for certification. The trial court granted the motion and
     certified the following question for review:
                  “Where the defendant in a dram shop case is being
              defended by the Illinois Insurance Guaranty Fund after
              defendant’s liability insurer was declared insolvent, and
              where plaintiff has already made an insurance recovery from
              plaintiff’s underinsured motorist insurer and from the alleged
              intoxicated person’s liability insurer, and where the jury
              returns a verdict in excess of the defendant’s maximum
              liability under the Dram Shop Act, is the reduction for ‘other
              insurance’ recoveries set forth in Section 546(a) of the Illinois

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             Insurance Guaranty Fund Act applied against the jury’s
             verdict or against the defendant’s maximum dram shop
             liability?”
¶8       The appellate court held that the section 546(a) reduction should
     be applied against the jury’s verdict. 2013 IL App (5th) 110546, ¶ 23.
     The court noted that while the Fund acts as a substitute for an
     insolvent insurer, it is not a separate source of recovery. Id. ¶ 13.
     Thus, “unless specific limitations in the Guaranty Fund statute are
     applicable, the Guaranty Fund’s obligation is determined by the
     Dramshop Act.” Id. The appellate court, however, did not look to the
     Dramshop Act to determine the extent of that obligation, but rather
     to emphasize the provision of a jury trial on damages without regard
     to the statutory limit. Id. ¶ 14. The court then discussed Kurth v.
     Amee, Inc., 3 Ill. App. 3d 506 (1972), a dramshop case that did not
     involve the Fund, which outlined a three-step procedure for setoffs in
     such cases: “First, the jury determines the total damages sustained.
     The jury’s award is then offset by other recoveries. Finally, if the
     remainder is above the statutory limit, it is reduced to that limit.”
     2013 IL App (5th) 110546, ¶ 15. The court disagreed that a different
     procedure should apply simply because the Fund was involved, and
     distinguished Roth v. Illinois Insurance Guaranty Fund, 366 Ill. App.
     3d 787 (2006), because it was not a Dramshop Act case. 2013 IL App
     (5th) 110546, ¶ 20. In closing the court noted:
             “[W]hether the Guaranty Fund is obligated to pay the
             statutory maximum in a dramshop case depends on the facts
             of the case. If the jury returns a verdict of $500,000 in the
             instant case, that amount would be reduced to $393,450,
             which would then be reduced to the statutory dramshop
             maximum of $130,338.51. However, if the jury returns a
             verdict of $200,000, that would be reduced to $93,450, which
             is less than the statutory maximum. We believe that these
             limits are sufficient to effectuate the purpose of section 546.”
             Id. ¶ 22.
¶9       This court allowed Imeri’s petition for leave to appeal. See Ill. S.
     Ct. R. 315(a) (eff. Feb. 26, 2010). We allowed the Illinois Trial
     Lawyers Association to file an amicus curiae brief in support of the
     plaintiffs. See Ill. S. Ct. R. 345 (eff. Sept. 20, 2010).




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¶ 10                                 ANALYSIS
¶ 11       Supreme Court Rule 308(a) provides for interlocutory appeals of
       nonfinal orders that present “a question of law as to which there is
       substantial ground for difference of opinion.” Ill. S. Ct. R. 308(a).
       When the trial court concludes that an answer to such a question
       “may materially advance the ultimate termination of the litigation,”
       the court must identify the question in writing, and the appellate court
       may allow an appeal. Id. Because an interlocutory appeal under Rule
       308(a) necessarily involves a question of law, our standard of review
       is de novo. In re Marriage of Mathis, 2012 IL 113496, ¶ 19 (citing
       Barbara’s Sales, Inc. v. Intel Corp., 227 Ill. 2d 45, 58 (2007)).
¶ 12       As the appellate court noted, the parties agree Imeri is entitled to
       a setoff of the $106,550 that the Rogerses received from the two
       automobile insurance policies. Their disagreement centers on how
       that setoff operates, or, more precisely, the amount against which it
       applies. The Fund argues that the setoff should be deducted from the
       statutory cap of $130,338.51, based on the plain language of the
       Guaranty Fund provisions. The Rogerses argue that the setoff should
       be deducted from the jury’s eventual verdict, which may then be
       reduced to the statutory cap, if necessary. These opposing positions
       correspond to those taken by the Fifth District here and the First
       District in Guzman v. 7513 West Madison Street, Inc., 2013 IL App
       (1st) 122161.
¶ 13       The cardinal rule of statutory construction is to ascertain and
       effectuate the legislature’s intent. Moore v. Green, 219 Ill. 2d 470,
       479 (2006). The best indicator of that intent is the express language
       of the statute, which should be given its plain and ordinary meaning.
       Wilkins v. Williams, 2013 IL 114310, ¶ 14. In interpreting a statute,
       we must read the relevant provisions in their entirety and in their
       context within the broader framework of the act of which they are a
       part. See Solon v. Midwest Medical Records Ass’n, 236 Ill. 2d 433,
       440 (2010). We now turn to the Insurance Code.
¶ 14       The Code establishes the Fund, a nonprofit entity that protects
       holders of policies issued by now-insolvent insurers, and third-party
       claimants under those policies, when expected coverage ceases to
       exist. See Hasemann v. White, 177 Ill. 2d 414, 415-16 (1997); see
       also 215 ILCS 5/532 (West 2012). The Fund is not “a collateral or
       independent source of recovery” (Lucas v. Illinois Insurance
       Guaranty Fund, 52 Ill. App. 3d 237, 240 (1977)); it is “a source of
       last resort,” whose role as a substitute insurer is subject to certain

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       statutory limitations (Illinois Insurance Guaranty Fund v. Farmland
       Mutual Insurance Co., 274 Ill. App. 3d 671, 673 (1995)). Section
       546(a) provides a key limitation, which ensures that potential claims
       on the Fund are reduced by the assets of solvent insurers, not assets
       of the Fund itself. That section, entitled “Other insurance,” provides:
                “An insured or claimant shall be required first to exhaust all
                coverage provided by any other insurance policy, regardless
                of whether or not such other insurance policy was written by
                a member company, if the claim under such other policy
                arises from the same facts, injury, or loss that gave rise to the
                covered claim against the Fund. The Fund’s obligation under
                Section 537.2 shall be reduced by the amount recovered or
                recoverable, whichever is greater, under such other insurance
                policy. Where such other insurance policy provides uninsured
                or underinsured motorist coverage, the amount recoverable
                shall be deemed to be the full applicable limits of such
                coverage. To the extent that the Fund’s obligation under
                Section 537.2 is reduced by application of this Section, the
                liability of the person insured by the insolvent insurer’s policy
                for the claim shall be reduced in the same amount.” 215 ILCS
                5/546(a) (West 2012).
¶ 15       Under section 546(a), the Rogerses, as claimants under Imeri’s
       policy with his now-insolvent insurer, were required to exhaust
       coverage provided by any other insurance policy, if their claim under
       such a policy arose from the same facts as Imeri’s “covered claim”
       against the Fund. The Rogerses’ claims under their automobile
       liability policy and Winterrowd’s automobile liability policy, like
       Imeri’s claim, were based on the accident. The amounts that the
       Rogerses recovered from their claims reduce the Fund’s obligation.
¶ 16       Section 537.2 states that the Fund “shall be obligated to the extent
       of the covered claims.” 215 ILCS 5/537.2 (West 2012). Section 534.3
       defines a “covered claim” as “an unpaid claim for a loss arising out
       of and within the coverage of an insurance policy to which this
       Article applies and which is in force at the time of the occurrence
       giving rise to the unpaid claim *** made by a person insured under
       such policy or by a person suffering injury or damage for which a
       person insured under such policy is legally liable.” Though the
       Guaranty Fund provisions do not define the term “legally liable,” that
       concept lies at the foundation of our civil and criminal jurisprudence,
       and simply contemplates an obligation. See Black’s Law Dictionary


                                          -5-
       997 (9th ed. 2009) (defining “liability” as “[t]he quality or state of
       being legally obligated or accountable; legal responsibility to another
       or to society, enforceable by civil remedy or criminal punishment”).
       In civil litigation, that obligation is an obligation to pay damages. See
       id. (defining “civil liability” as “[t]he state of being legally obligated
       for civil damages”). Thus, as the appellate court here observed, the
       Fund’s obligation is linked with Imeri’s obligation to pay damages.
       2013 IL App (5th)110546, ¶ 13. In this case, Imeri’s obligation cannot
       exceed $130,338.51. See 235 ILCS 5/6-21(a) (West 2012) (“in no
       event shall the judgment or recovery for injury to the person or
       property of any person exceed” the statutory cap). And that is the
       maximum extent of the Fund’s obligation.
¶ 17        The Rogerses, however, ask us to ignore the plain language of the
       Guaranty Fund provisions, as well as the clear limit of the Dramshop
       Act, and to focus on the latter statute’s requirement that “the jury
       shall determine the amount of damages to be recovered without
       regard to and with no special instructions as to the dollar limits on
       recovery.” 235 ILCS 5/6-21(a) (West 2012). The Rogerses insist that
       the only way to read that requirement in harmony with section 546(a)
       is to let the jury set the amount of damages, reduce that amount by
       any other insurance proceeds, and then, if necessary, reduce the
       resulting amount to the statutory cap.
¶ 18        Guzman correctly rejected that approach. There, a panel from the
       First District addressed the same certified question as the panel from
       the Fifth District in this case, but reached a different answer. The
       Guzman court looked to the Dramshop Act, and concluded that the
       defendant was “legally liable” to the plaintiffs only up to the
       maximum recovery possible under that Act. Guzman, 2012 IL App
       (1st) 122161, ¶ 26. The court distinguished Kurth, noting that, while
       that case determined the proper procedure for setoffs in dramshop
       cases generally, it did not interpret section 546(a) or determine the
       proper procedure for setoffs in dramshop cases involving defendants
       represented by the Fund. Id. ¶ 30.
¶ 19        The requirement that a jury determine damages in Dramshop Act
       cases is simply not relevant to the construction of section 546(a).
       Under that statute, the Fund’s obligation cannot be expanded by a
       jury’s verdict; it can only be reduced by other insurance. The setoff
       of the amount that the Rogerses received from the automobile liability
       insurance policies should come from Imeri’s maximum dramshop
       liability.


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¶ 20                              CONCLUSION
¶ 21       For the reasons that we have stated, the judgment of the appellate
       court is reversed, and the cause is remanded to the circuit court for
       further proceedings.

¶ 22      Appellate court judgment reversed.
¶ 23      Cause remanded.




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