                           ILLINOIS OFFICIAL REPORTS
                                         Appellate Court




                Direct Auto Insurance Co. v. Beltran, 2013 IL App (1st) 121128




Appellate Court            DIRECT AUTO INSURANCE COMPANY, Plaintiff-Appellant, v. ELIA
Caption                    BELTRAN, MARIO BELTRAN, ARACELI BELTRAN, ACUITY
                           INSURANCE COMPANY, as subrogee of Alice Obermann, George
                           Obermann, and Mark Obermann, ALICE OBERMANN, and GEORGE
                           OBERMANN, Defendants-Appellees (Crescend Technologies LLC and
                           Lutheran General Hospital, Defendants).


District & No.             First District, Fifth Division
                           Docket No. 1-12-1128


Filed                      September 27, 2013


Held                       In an insurer’s action seeking a declaratory judgment that the automobile
(Note: This syllabus       liability policy issued to defendant was rescinded and null and void ab
constitutes no part of     initio, the trial court properly denied plaintiff’s motion for summary
the opinion of the court   judgment and granted defendants’ motion for summary judgment based
but has been prepared      on the finding that the policy provided coverage, notwithstanding the
by the Reporter of         facts that the named insured’s application listed her gender as “M,” even
Decisions for the          though she was a female, it stated that she had an international driver’s
convenience of the         license, that only one driver resided at her residence and that there would
reader.)
                           be only one driver of the insured vehicle, since the named insured stated
                           in her deposition that she did not know how to drive and that she
                           purchased the insured vehicle for her brother to drive to work, the facts
                           that the named insured’s application was taken over the telephone and
                           was not signed by the named insured, and under the circumstances, any
                           misrepresentations were not material, because the number of regular
                           drivers was not misstated, the chances of the events insured against were
                           not substantially increased, and most importantly, there was no indication
                           the named insured intentionally misrepresented any facts.
Decision Under             Appeal from the Circuit Court of Cook County, No. 09-CH-33780; the
Review                     Hon. LeRoy Martin, Judge, presiding.


Judgment                   Affirmed.


Counsel on                 Brianne M. Connell, of James P. Newman & Associates, of St. Charles,
Appeal                     for appellant.

                           James P. Marsh and Rachael A. Gould, both of Momkus McCluskey,
                           LLC, of Lisle, for appellees.


Panel                      PRESIDING JUSTICE GORDON delivered the judgment of the court,
                           with opinion.
                           Justices Palmer and Taylor concurred in the judgment and opinion.




                                             OPINION

¶1          Plaintiff Direct Auto Insurance Co. (DAI) filed an action seeking a declaratory judgment,
        arguing that: (1) an insurance policy it issued to defendant Elia Beltran was rescinded and
        null and void, ab initio; (2) that DAI owed no duties under the policy to any of the
        defendants; and (3) that defendants were not entitled to any recovery under the policy. DAI
        and defendant Acuity Insurance Company (Acuity), as subrogee of Alice Obermann, George
        Obermann, and Mark Obermann, filed cross-motions for summary judgment. The trial court
        granted Acuity’s motion and denied DAI’s motion, finding coverage. DAI filed a motion to
        reconsider, which the trial court denied. DAI appeals, and we affirm.

¶2                                        BACKGROUND
¶3                                  I. The Parties and The Policy
¶4          DAI is an insurance company with its principal place of business in Chicago, Illinois.
        DAI is duly licensed to underwrite policies for automobile insurance, and to sell such
        policies and coverage to members of the general public. Elia Beltran (Elia), Mario Beltran
        (Mario), and Araceli Beltran (Araceli) are Illinois residents. Elia speaks limited English and
        her Spanish literacy is limited by the fact that she cannot write in Spanish.
¶5          DAI received an application for automobile insurance from Northwest Insurance


                                                 -2-
       Network, Inc. (NIN), an insurance broker.1 The application listed Elia as the applicant. The
       application lists Elia’s gender as “M,” despite Elia being a woman. The application states
       that Elia has an international driver’s license. However, Elia testified in her deposition that
       she does not know how to drive an automobile. Elia owns a 2006 Ford Freestyle SE motor
       vehicle (the Elia vehicle). Elia purchased the Elia vehicle with the intent that Mario, her
       brother, would use it to drive her to and from work. Elia did not sign the application, and
       instead, the applicant signature lines bear the notation “T/O.”2 After receiving the
       application, DAI issued a policy of insurance to Elia (the DAI policy). The DAI policy
       covered bodily injury, property damage, medical payments, uninsured motorist, and physical
       damage. The DAI policy had an effective date of November 23, 2008.
¶6         Acuity is a Wisconsin mutual insurance company, licensed and authorized to write
       insurance in the State of Illinois. Alice Obermann (Alice), George Obermann (George), and
       Mark Obermann (Mark) are Illinois residents. “Alice Obermann, George Obermann, and
       Mark Obermann had in force a certain policy of insurance with Acuity Insurance Company
       [(the Acuity policy)] which provided, among other things, automobile coverage for payment
       of property damage and medical payments incurred as a result of an automobile collision.”
¶7         The other defendants, Crescend Technologies, LLC (Crescend), an Illinois limited
       liability corporation, and Lutheran General Hospital (Lutheran), an Illinois not-for-profit
       entity, did not participate in this appeal.

¶8                                  II. The Underlying Action
¶9         The declaratory judgment action in the case at bar arises from an underlying subrogation
       action filed by Acuity, as subrogee of Alice, George, and Mark. Acuity filed a two-count
       complaint in the circuit court of Cook County, alleging negligence against Mario and
       negligent entrustment against Elia. Acuity states in the underlying complaint that the lawsuit
       “is a subrogation action wherein the real parties in interest are Acuity Insurance Company
       and Mark Orbermann” with regard to the negligence claim, and “is a subrogation action
       wherein the real parties in interest are Acuity Insurance Company and Alice Obermann,
       George Obermann, and Mark Orbermann” with regard to the negligent entrustment claim.
¶ 10       The underlying complaint alleges the following facts. On or about December 15, 2008,
       Mario was operating the Elia vehicle, and Mark was operating his vehicle, which was
       covered by the Acuity policy. Mario had a duty to operate the Elia vehicle in a safe and
       reasonable manner, and Mario breached that duty. The two vehicles collided, “causing
       property damages to [Mark’s] vehicle and injuries to [Mark] requiring medical treatment.”
       The complaint further alleges that Elia placed the Elia vehicle “in the care and custody of


               1
                NIN is not a party to this lawsuit. In her affidavit, an NIN representative refers to NIN as
       an “independent broker.” In the complaint, DAI refers to NIN as an “independent insurance agency.”
               2
                Defendant Acuity Insurance Co. states in its brief that “T/O” “indicates that [the
       application] was made over the telephone.” The application has three signature lines. Two contain
       the notation “T/O,” and the third, which states “Received by,” bears a signature.

                                                   -3-
       [Mario] knowing that his ability to drive the vehicle and his reliability were such that she was
       placing a careless, negligent, reckless, incompetent and unsafe driver upon the streets when
       she knew, or in the exercise of ordinary care, should have known, that by doing so, she might
       or could cause injury to other persons on the public way.” Pursuant to the Acuity policy,
       Acuity “paid policy benefits in the amount of $10,000.00 for medical payments on behalf of
       [Mark] and property damage payments on behalf of Alice Obermann, George Obermann, and
       Mark Obermann in the amount of $9,738.01, including towing charges and storage and a
       $500.00 deductible.”

¶ 11                                   III. The Declaratory Action
¶ 12                                         A. The Complaint
¶ 13        DAI filed a declaratory judgment action, alleging that Elia made material
       misrepresentations in her application for insurance, and as a result, there was no coverage.
       DAI alleges the following facts: NIN was an “independent insurance agency” acting as Elia’s
       agent for the purpose of securing insurance. On or about November 24, 2008, Elia, through
       NIN, submitted an electronic application for insurance to DAI. The DAI policy was issued
       on November 28, 2008, based on the application submitted by NIN. Elia was the named
       insured under the DAI policy, and owned the Elia vehicle.
¶ 14        The DAI policy was subject to the following terms and conditions:
                 “4. Fraud and Misrepresentation. Statements contained in the application for
            insurance are deemed to be representations relied upon by [DAI] in issuing this policy.
            In the event that any representation contained in the application is false, misleading or
            materially affects the acceptance or rating of risk by [DAI], by either direct
            misrepresentation, omissions, concealment of facts or incorrect statements, then coverage
            for the accident or loss in question shall not be provided by [DAI] and/or this policy shall
            be null and void and of no benefit whatsoever from its inception.
                                                   ***
                 17. Declarations. By acceptance of this policy the named insured agrees that the
            statements and representations contained in the Application have been made by him/her
            or on his/her behalf and said statements are representations and the statements in the
            Application and in any subsequent application or questionnaire accepted by [DAI] are
            offered as an inducement to [DAI] to issue or to continue this policy and that this policy
            is issued and continued in reliance upon the truth of such statements and representations
            and that this policy embodies all agreements existing between himself/herself and [DAI]
            relating to this insurance.”
¶ 15        The application requests a list of the known drivers of the Elia vehicle. The application
       lists Elia as a driver and states that “[a]pplicant warrants there are no other drivers other than
       those listed below.” No other drivers are so listed. The application contains a paragraph
       stating that the applicant acknowledges that she has read and attests that all answers provided
       are true.
¶ 16        On or about December 15, 2008, Mario was operating the Elia vehicle, and at this time,


                                                  -4-
       the Elia vehicle “came into contact with the person or property” of Alice and Mark. As a
       result of the collision, Acuity, as subrogee of Alice and Mark, filed the underlying
       subrogation action against Mario and Elia.
¶ 17       DAI alleges that Elia, “either individually or through her agent, intentionally misled DAI
       as to the other drivers in her residence.” DAI alleges that, had it known that the Elia vehicle
       was to be operated by drivers other than Elia, “said information would have materially
       affected DAI’s decision to issue the DAI policy” to Elia, and that it would not have issued
       the DAI policy as written. DAI further alleges that, due to Elia’s material misrepresentation,
       the DAI policy is null and void, ab initio. DAI rescinded the policy and returned Elia’s full
       premium on or about December 29, 2008, and owes no duty to defend or indemnify Mario
       and Elia.
¶ 18       DAI asks the trial court to declare: (1) that as a result of Elia’s material
       misrepresentations, the DAI policy is “rescinded and null and void, ab initio, and of no
       benefit whatsoever”; (2) that DAI owes no duty under the DAI policy to defend or indemnify
       Elia and Mario with regard to any claim or lawsuit made by them or the other defendants as
       herein named as a result of the vehicle collision; (3) that none of the defendants are entitled
       to recovery under the DAI policy for or in connection with any claim or lawsuit resulting
       from the vehicle collision; and (4) “any such other and further relief” that the trial court
       “deems just and appropriate in the circumstances.”

¶ 19                                     B. Answer and Default
¶ 20       Defendants Acuity, Alice, George, and Mark filed an answer and counterclaim to the
       declaratory judgment action. The counterclaim also sought a declaratory judgment
       requesting: (1) the trial court to “declare and adjudicate the rights, obligations, and liabilities
       of the parties to this suit with respect to the DAI policy”; (2) a finding of coverage for
       indemnity of Mario and Elia for the underlying action under the DAI policy; (3) a finding
       that DAI owes a duty to defend Mario and Elia in the underlying action under the DAI
       policy; (4) a finding that DAI owes a duty to indemnify Mario and Elia in the underlying
       action under the DAI policy; (5) that Acuity is entitled to judgment in its favor; and (6) that
       Acuity is entitled to any other or further relief that the trial court deems just and equitable.
¶ 21       The counterclaim alleges that the DAI policy contains the following term:
               “Persons Insured. The following are Insured under Part I:
                   (a) With respect to the owned automobile;
                       (1) the named insured, or
                       (2) any other person using such automobile to whom the named insured has
                   given permission, provided the use is within the scope of such permission.”
       Acuity alleges that Elia gave Mario permission to drive the Elia vehicle, and was therefore
       an insured under the DAI policy.
¶ 22       Defendants Elia, Mario, Araceli, Crescend, and Lutheran did not file answers. DAI filed
       motions for default against those defendants, and the trial court granted the motions, finding
       them in default.

                                                  -5-
¶ 23                        C. Motions for Summary Judgment
¶ 24      DAI and Acuity, as subrogee of Alice, George, and Mark, filed cross-motions for
       summary judgment seeking judgment in their favor in their respective declaratory judgment
       lawsuits.

¶ 25                                      1. DAI’s Motion
¶ 26       DAI argues that Elia made an intentional material misrepresentation, and as a result, the
       DAI policy is void, ab initio. DAI attached Elia’s deposition, at which she was aided by a
       Spanish interpreter. She testified that she and Mario lived in the same apartment on the day
       before the effective date of the DAI policy. DAI argues that Elia’s failure to disclose other
       drivers in her household constituted a material misrepresentation that allowed DAI to rescind
       the policy. DAI argues that even if Mario, an undisclosed driver who lived with Elia at the
       time the DAI policy was issued, was a permissive user under the DAI policy, no coverage
       existed because Elia made material misrepresentations in her application for insurance, and
       thus, the policy was void, ab initio. DAI argued that the policy was void, and that, unlike a
       policy defense in which the policy still exists, if a policy is void due to a material
       misrepresentation, it is treated as having never existed in the first place.
¶ 27       DAI asserted, through the affidavit of DAI claims manager Michael Torello, that it had
       returned Elia’s policy premium to NIN. DAI also argued that, because Elia, Mario, Araceli,
       Crescend, and Lutheran were found to be in default, all well-pled allegations are considered
       admitted against them.
¶ 28       Concerning NIN’s role in submitting the application for the DAI policy, DAI attached
       the affidavit of NIN representative Linda Robnett, in which she attested to the following.3
       NIN is not an agent of DAI, but is an independent broker. DAI exercises no control over NIN
       and does not pay NIN. NIN sells products from “a variety of insurers, not just [DAI].” NIN
       receives a commission, which is added to the premium paid by Elia, the insured. NIN did not
       contact DAI until Elia “chose [DAI] as her insurer from a host of insurers available,” and
       NIN received Elia’s application for insurance through an automobile dealership. “NIN
       records do not reflect Elia Beltran or Elia Beltran’s agent at the dealership disclosing Mario
       Beltran as a member of Elia Beltran’s household.” (Emphasis added.)
¶ 29       The trial court denied DAI’s motion for summary judgment.

¶ 30                                   2. Acuity’s Motion
¶ 31       Acuity, as subrogee of Alice, George, and Mark, filed a motion for summary judgment
       seeking a favorable disposition of its counterclaim for a declaratory judgment. The motion
       stated the following. In DAI’s answers to Acuity’s interrogatories, DAI stated that NIN’s


               3
                 Robnett’s affidavit does not assert that her statements are based upon personal knowledge,
       nor does it attach sworn or certified copies of any documents referred to in the affidavit, as required
       by Illinois Supreme Court Rule 191(a) (eff. July 1, 2002).

                                                    -6-
       commission is included in the premium Elia paid for the DAI policy. Acuity attached a letter
       from DAI to NIN, in which DAI informed NIN that the DAI policy was null and void, ab
       initio, because of material misrepresentations made by Elia in her application. The letter
       began with “Dear Agent,” and stated that DAI would credit NIN’s “agent statement.”
¶ 32        Acuity also attached Elia’s deposition, at which she testified to the following: Elia was
       unable to recall the name of the dealership where she purchased her vehicle. Upon
       purchasing the vehicle, someone at the dealership informed Elia that the vehicle came with
       insurance. Elia does not know how to drive, and she purchased the vehicle with the intent
       that Mario would operate it. Elia testified that someone at the dealership asked Elia about
       whether other people in her household would drive the vehicle:
                “Q. Did you inform this individual [at the dealership] that Mario resided with you?
                A. Yes.
                Q. What did he say when you informed him that Mario resided with you?
                A. ‘No, that’s okay. That’s okay.’
                Q. He told you ‘That’s okay’?
                A. Since I tell [sic] him that I don’t know how to drive and that my brother is going
            to drive the [Elia vehicle], they said, ‘It’s okay.’ ”
       Elia testified that she did not speak with NIN to “apply [for] or obtain insurance for the [Elia
       vehicle],” and that she did not contact NIN until the vehicle collision. Elia testified that the
       signature on the NIN application was not hers. At the time of the accident, Mario obtained
       Elia’s permission to operate the Elia vehicle.
¶ 33        Acuity argues that the NIN application listed Elia’s gender as “M,” despite the fact that
       Elia is a woman. The application further lists Elia as carrying an international driver’s
       license, but Elia does not have a driver’s license.
¶ 34        Acuity argues that DAI failed to, and cannot, prove that Elia made a material
       misrepresentation necessary to declare the policy void, ab initio, because Elia did not make
       a false statement and, even if she had, she had no intent to deceive or materially affect the
       acceptance of the risk or hazard assumed by DAI. Acuity next argues that, even if Elia made
       a material misrepresentation, DAI failed to properly rescind the DAI policy and has waived
       any opportunity to do so. Acuity further argues that DAI is prevented from rescinding the
       DAI policy, both by statute and by public policy.
¶ 35        Finally, Acuity argues that although independent insurance brokers like NIN can have
       dual agencies to both insurers and insured, the facts of the case indicate that NIN was an
       actual or apparent agent of DAI as a matter of law. As a result, NIN’s actions and knowledge
       are imputed to DAI. Acuity argues that because of “NIN’s knowledge that Elia could not
       drive and that Mario was a resident driver,” DAI is imputed to have this knowledge and
       could not claim that Elia made a misrepresentation.
¶ 36        The trial court granted Acuity’s motion for summary judgment.




                                                 -7-
¶ 37                                   D. Motion to Reconsider
¶ 38        DAI filed a motion to reconsider the trial court’s denial of its motion for summary
       judgment and its granting of Acuity’s motion for summary judgment. DAI asserts that the
       trial court erred in applying the law because defendants did not counter facts attested to in
       the affidavits DAI used to support its motion for summary judgment. DAI asserts that these
       affidavits were sufficient to establish that Elia made a material misrepresentation, and thus
       it was entitled to summary judgment. DAI also attached a printout analyzing the difference
       in the cost of the premium had drivers in addition to Elia been disclosed in her application.
       The printout states that, had Elia listed on the application that other drivers resided with her,
       her premium would have been four times greater.
¶ 39        The trial court issued a written order denying DAI’s motion to reconsider. The trial court
       concluded that Elia made no intentional misrepresentation. The trial court further concluded
       that “[t]here was one licensed, male driver in [Elia’s] residence at the time of the application
       [Mario]. If the application had been completed correctly, with the name Mario instead of
       Elia, Mario would not have been required to disclose that Elia lived in the residence with him
       because she is not a licensed driver, according to the application form questions.” The trial
       court found no evidence of “any other indicators that might have affected the risk assumed
       negatively, such as a negative driving record, etc.” DAI appeals.

¶ 40                                      ANALYSIS
¶ 41       DAI raises two issues on appeal: (1) whether the trial court erred in granting Acuity’s
       motion for summary judgment and denying DAI’s motion for summary judgment; and (2)
       whether the trial court erred in denying DAI’s motion to reconsider. For the following
       reasons, we affirm.

¶ 42                                     I. Standard of Review
¶ 43       Summary judgment is appropriate where the pleadings, depositions, admissions, and
       affidavits show that there is no genuine issue of material fact and that the moving party is
       entitled to judgment as a matter of law. Mashal v. City of Chicago, 2012 IL 112341, ¶ 49.
       Summary judgment is a “drastic means of disposing of litigation and, therefore, should be
       granted only when the right of the moving party is clear and free from doubt.” Mashal, 2012
       IL 112341, ¶ 49. Where a case is decided through summary judgment, our standard of review
       is de novo. Pielet v. Pielet, 2012 IL 112064, ¶ 30. De novo consideration means we perform
       the same analysis that a trial judge would perform. Khan v. BDO Seidman, LLP, 408 Ill. App.
       3d 564, 578 (2011). “A defendant moving for summary judgment bears the initial burden of
       proof.” Siegel Development, LLC v. Peak Construction, LLC, 2013 IL App (1st) 111973,
       ¶ 109. “The defendant may meet his burden of proof either by affirmatively showing that
       some element of the case must be resolved in his favor or by establishing ‘ “that there is an
       absence of evidence to support the nonmoving party’s case.” ’ ” Siegel, 2013 IL App (1st)
       111973, ¶ 109 (quoting Nedzvekas v. Fung, 374 Ill. App. 3d 618, 624 (2007), quoting
       Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)). Where a plaintiff has moved for
       summary judgment, the materials relied upon must establish the validity of the plaintiff’s

                                                 -8-
       factual position on all the contested elements of the cause of action. General Motors Corp.
       v. Douglass, 206 Ill. App. 3d 881, 885 (1990).
¶ 44       Regarding the second issue, “[a] ruling on a motion to reconsider is within the sound
       discretion of the trial court and will not be disturbed absent an abuse of discretion.” Robidoux
       v. Oliphant, 201 Ill. 2d 324, 347 (2002). “An abuse of discretion will be found where no
       reasonable person would take the view adopted by the circuit court.” Fennell v. Illinois
       Central R.R. Co., 2012 IL 113812, ¶ 21.

¶ 45                              II. Summary Judgment Motions
¶ 46       DAI argues that the trial court erred when it granted defendants’ motion for summary
       judgment and denied DAI’s motion for summary judgment. DAI argues that Elia made a
       material misrepresentation in her application for the DAI policy, and as a result, DAI
       properly rescind the DAI policy.
¶ 47       Section 154 of the Illinois Insurance Code (the Code) states the following:
           “No misrepresentation or false warranty made by the insured or in his behalf in the
           negotiation for a policy of insurance, or breach of a condition of such policy shall defeat
           or avoid the policy or prevent its attaching unless such misrepresentation, false warranty
           or condition shall have been stated in the policy or endorsement or rider attached thereto,
           or in the written application therefor. No such misrepresentation or false warranty shall
           defeat or avoid the policy unless it shall have been made with actual intent to deceive or
           materially affects either the acceptance of the risk or the hazard assumed by the
           company.” (Emphasis added.) 215 ILCS 5/154 (West 2008).
       “The statute establishes a two-prong test to be used in situations where insurance policies
       may be voided: the statement must be false and the false statement must have been made
       with an intent to deceive or must materially affect the acceptance of the risk or hazard
       assumed by the insurer.” (Emphasis added.) Golden Rule Insurance Co. v. Schwartz, 203 Ill.
       2d 456, 464 (2003). “A misrepresentation in an application for insurance is a statement of
       something as a fact which is untrue and affects the risk taken by the insurer.” (Emphasis
       added.) Northern Life Insurance Co. v. Ippolito Real Estate Partnership, 234 Ill. App. 3d
       792, 801 (1992) (citing Weinstein v. Metropolitan Life Insurance Co., 389 Ill. 571, 577
       (1945)). Whether an insured’s statements are material “is determined by whether reasonably
       careful and intelligent persons would have regarded the facts stated as substantially
       increasing the chances of the events insured against, so as to cause a rejection of the
       application.” (Emphasis added.) Northern Life, 234 Ill. App. 3d at 801.
¶ 48       In establishing the materiality of a misrepresentation, an insurer may rely on the
       underwriter’s testimony or the testimony of its employees. Northern Life, 234 Ill. App. 3d
       at 802. “Ordinarily, the materiality of a misrepresentation is a question of fact; however,
       where the misrepresentation is of such a nature that all would agree that it is or is not
       material, the question is appropriate for summary judgment.” Northern Life, 234 Ill. App. 3d
       at 802.
¶ 49       First, DAI asserts, without argument, that the first prong of the rescission test has been
       satisfied because Elia made a false statement. DAI states that although Elia’s application lists

                                                 -9-
       no other drivers in her household, she testified in her deposition that she and Mario lived in
       the same household. DAI argues that Elia also testified that Mario would drive the Elia
       vehicle and therefore Elia herself “indicated that the information in the application was false”
       because she failed to disclose a licensed driver at her residence in addition to herself.
¶ 50        However, Elia’s testimony, which is unrebutted, unequivocally states that she herself was
       not a licensed driver and that she would not operate the Elia vehicle. Elia testified that she
       purchased the Elia vehicle with the intent that Mario would drive it. Elia did not testify that
       she was a licensed driver or that there were licensed drivers in addition to Mario residing
       with her. Therefore, the number of drivers covered under the policy is the same as the
       number of drivers disclosed by Elia: one. In effect, Elia was given coverage seeking coverage
       for Mario for a nonowned automobile.
¶ 51        The discrepancy lies in the name of the insured driver. The application states that a male
       named Elia Beltran is the insured driver, when in fact (1) a male named Mario Beltran was
       the intended insured driver and (2) Elia is a female.
¶ 52       DAI cites various cases to argue that Elia’s misrepresentation was material. In Styzinski
       v. United Security Life Insurance Co. of Illinois, 332 Ill. App. 3d 417 (2002), the insurer filed
       a counterclaim asserting that the insured made a material misrepresentation on his
       application for medical insurance, and asked the trial court to find that the policy be
       rescinded. Styzinski, 332 Ill. App. 3d at 418. The insured filled out an application for
       insurance, and answered “no” to the following question: “ ‘Does any person named above
       contemplate or has within the last two years been engaged in the following activities: ***
       Motorcycle Driving or Racing ***?’ ” Styzinski, 332 Ill. App. 3d at 419. After the insurer
       issued the policy to the insured, the insured was injured in a motorcycle accident. Styzinski,
       332 Ill. App. 3d at 419.
¶ 53        The insurer filed a motion for summary judgment on its counterclaim and attached the
       depositions of the insured and the insurer’s underwriting manager. In his deposition, the
       insured testified that at the time he completed the application for insurance, he had a license
       to drive a motorcycle and owned a “street bike” and an “off-road bike.” Styzinski, 332 Ill.
       App. 3d at 420. The insured, a mechanic, further testified that he repaired “approximately
       a dozen motorcycle or dirt bikes per year and test-drove all of them.” Styzinski, 332 Ill. App.
       3d at 420. The insured testified that he had operated dirt bikes and motorcycles during the
       two-year period prior to submitting the application. Styzinski, 332 Ill. App. 3d at 420.
       However, the insured testified that he operated the dirt bikes and motorcycles “off-road,” and
       at the time he submitted the application, he had not operated a motorcycle on the highway
       during the prior two years and he had no intention of operating a motorcycle on the streets
       in the future. Styzinski, 332 Ill. App. 3d at 420. The insurer’s underwriting manager testified
       in his deposition that in his capacity as underwriting manager, he “evaluated the risks
       presented by insurance applications, determined whether a policy should be issued, and if so,
       whether it should be issued with an endorsement limiting or changing the terms of coverage.”
       Styzinski, 332 Ill. App. 3d at 420-21. The underwriting manager testified that had the insured
       answered “yes” to the motorcycle question on the application, the insurer “would have asked
       follow-up questions regarding [the insured’s] use of motorcycles and issued an elimination
       endorsement excluding coverage for motorcycle injuries.” Styzinski, 332 Ill. App. 3d at 421.

                                                 -10-
       The trial court granted summary judgment, and this court affirmed, finding that the insurer
       would not have provided coverage for motorcycle injuries had the insured revealed that he
       test-drove motorcycles during the two years prior to submitting the application.
¶ 54       In Northern Life, the insurer brought suit to rescind six life insurance policies issued to
       the insured, arguing that the insured materially misrepresented the condition of his health
       when he applied for life insurance. Northern Life, 234 Ill. App. 3d at 793-94. When the
       insured completed the application for the sixth insurance policy, he disclosed the fact that
       he suffered from hemophilia and disclosed all of his treatments and physicians for the
       preceding five years, but he failed to disclose that he had recently suffered a weight loss of
       approximately 20 pounds. Northern Life, 234 Ill. App. 3d at 794-95. The insured was
       subsequently diagnosed with AIDS. Northern Life, 234 Ill. App. 3d at 795. The insured’s
       physician explained to him that no cure for AIDS existed and that he would eventually die
       from it. Northern Life, 234 Ill. App. 3d at 795. After he was diagnosed with AIDS, the
       insured completed an amendment to the application for the sixth policy, in which the insured
       verified that the information contained in the application as amended was true and correct,
       that he continued to be in good health, and had not suffered any sickness or consulted or
       attended by a physician. Northern Life, 234 Ill. App. 3d at 795.
¶ 55       The trial court found that the insured made material misrepresentations with regard to the
       sixth policy, holding that the insured had an intent to deceive the insurer regarding the
       condition of his health, and it granted summary judgment on the sixth policy. Northern Life,
       234 Ill. App. 3d at 796. On appeal, this court found that “the record indicates that [the
       insurer] did indeed rely upon representations made by [the insured] in the amendment.”
       Northern Life, 234 Ill. App. 3d at 802. The insurer’s chief underwriter testified “that
       disclosures made by [the insured] in the amendment would be considered in evaluating
       whether [the insurer] could accept the risk.” Northern Life, 234 Ill. App. 3d at 802. The chief
       underwriter testified that, had the insured disclosed on the amendment that he had been
       diagnosed with AIDS, the insurer “would have declined coverage because AIDS was then,
       and is now, uninsurable.” (Emphases added.) Northern Life, 234 Ill. App. 3d at 802.
       Furthermore, a physician testified that he was familiar with insurance industry practices, and
       opined that the insured’s misrepresentation was material. Northern Life, 234 Ill. App. 3d at
       802. This court found that the insured misrepresented his condition of health on the
       amendment because he did not disclose that he had been diagnosed with AIDS and stated in
       his application that he continued to be in good health. Northern Life, 234 Ill. App. 3d at 802.
       This court determined that “reasonably careful and intelligent persons would regard the
       diagnosis of AIDS, an uninsurable condition, substantially increasing the risk assumed by
       [the insurer],” and thus “it was not improper for the circuit court to hold that [the insured]
       materially misrepresented his condition of health.” Northern Life, 234 Ill. App. 3d at 802.
       This court further concluded that the insured’s misrepresentation was deliberate and
       intentional because the insured learned new facts that rendered portions of his application
       no longer true, but signed the amendment averring that the information contained in the
       application was true. Northern Life, 234 Ill. App. 3d at 803 (citing Stipcich v. Metropolitan
       Life Insurance Co., 277 U.S. 311, 316 (1928)). As a result, this court affirmed the trial
       court’s grant of summary judgment with regard to the sixth policy. Northern Life, 234 Ill.

                                                -11-
       App. 3d at 803-04.
¶ 56        Finally, in Ratliff v. Safeway Insurance Co., 257 Ill. App. 3d 281 (1993), the insured filed
       a declaratory judgment action seeking a declaration that her son was insured under an
       automobile insurance policy and that “the protection of the [insurance policy] extended to
       any claims arising out of [the son’s] operation of the [motor vehicle] described in the policy.”
       Ratliff, 257 Ill. App. 3d at 282. In 1984, the insured applied for an automobile insurance
       policy with the insurer. Ratliff, 257 Ill. App. 3d at 282. The insured applied for the insurance
       policy through “an independent agency [the independent agency] selling policies for several
       insurance companies.” Ratliff, 257 Ill. App. 3d at 282. In 1986, after receiving a renewal
       notice, the insured called the independent agency to renew the insurance policy. Ratliff, 257
       Ill. App. 3d at 282. The insured answered several questions and stated that “none of the
       information from the previous year had changed; that she was the main driver of the
       automobile; that her son *** was an ‘occasional’ driver of the automobile; and that there
       were no ‘regular’ drivers of the automobile under the age of 25.” Ratliff, 257 Ill. App. 3d at
       282. The insured “never saw, read, or signed the application for renewal, and did not know
       whose signature appears on it.” Ratliff, 257 Ill. App. 3d at 282. “The application for [the
       insured’s] 1986 automobile insurance, which was completed by [the independent agency],
       states in part that ‘APPLICANT WARRANTS THAT THERE ARE NO OTHER DRIVERS
       IN THE HOUSEHOLD, OTHER THAN THOSE LISTED BELOW.’ ” Ratliff, 257 Ill. App.
       3d at 282-83. The application did not list the insured’s son as a driver of the vehicle. Ratliff,
       257 Ill. App. 3d at 283. The applicant signature line was blank and the applicant’s agent
       signature line contained an illegible signature. Ratliff, 257 Ill. App. 3d at 283.
¶ 57        On December 27, 1986, the insured’s son was operating the vehicle with the insured’s
       permission and was “involved in an accident with another vehicle.” Ratliff, 257 Ill. App. 3d
       at 283. At the time of the accident, the insured’s son was 20 years old and “had always lived
       with [the insured].” Ratliff, 257 Ill. App. 3d at 283. The insured’s son drove the vehicle
       approximately twice a week, and he always had the insured’s permission to drive the vehicle.
       Ratliff, 257 Ill. App. 3d at 283. The driver of the other vehicle filed suit against the insured
       and her son, and the insurer refused to provide coverage or provide a defense to the insured
       and her son. Ratliff, 257 Ill. App. 3d at 283. In response, the insured and her son filed a
       declaratory action against the insurer. Ratliff, 257 Ill. App. 3d at 283. The case proceeded to
       a bench trial and at the close of the insured’s case, the insurer made a motion for a directed
       finding. Ratliff, 257 Ill. App. 3d at 283. The trial court granted the motion, finding that: (1)
       the insured’s son was not contemplated as an insured in the policy; (2) disclosure of the
       insured’s son as a driver would have presented an increased risk to the insurer; (3) the
       complaint in the underlying action arising out of the accident could not state a cause of action
       against the insured solely on the basis of ownership of the vehicle; and (4) the insurance
       policy was void. Ratliff, 257 Ill. App. 3d at 283.
¶ 58        On appeal, the only issue before this court was whether the trial court’s finding that “the
       contract of automobile insurance between [the insured] and [the insurer] did not provide
       coverage for [the insured’s son] was against the manifest weight of the evidence.” Ratliff,
       257 Ill. App. 3d at 284. This court stated that there were three circumstances under which a
       finding would be against the manifest weight of the evidence: “(1) if [the independent

                                                 -12-
       agency] was acting as [the insurer’s] agent when it filled out the application for renewal of
       insurance; (2) if the non-disclosure on the application form of [the insured’s son] as another
       driver of the insured automobile was not material and did not affect [the insurer’s] risk; or
       (3) if the insurance contract was ambiguous as to [the insured’s son’s] coverage.” Ratliff, 257
       Ill. App. 3d at 284.
¶ 59        This court found that “the nondisclosure of a 20-year-old driver residing in the same
       household is a misrepresentation that materially affects the risk assumed by the insurer.”
       Ratliff, 257 Ill. App. 3d at 288. This court stated that “ ‘[i]t is a matter of common knowledge
       that the rate frequency of accidents for drivers between the ages of sixteen and twenty-four
       is substantially greater than for all drivers who are twenty-five years of age or more.’ ”
       Ratliff, 257 Ill. App. 3d at 288 (quoting Western States Mutual Automobile Insurance Co. v.
       May, 18 Ill. App. 2d 442, 448 (1958), overruled by Sobina v. Busby, 62 Ill. App. 2d 1
       (1965)). This court concluded that, had the insured disclosed the presence of her son as a
       driver in her household, his age, and the amount he drove the vehicle, the insurer “certainly”
       would have reassessed the risk it was assuming. Ratliff, 257 Ill. App. 3d at 288. This court
       stated that “the materiality of the non-disclosure [was] confirmed by the stipulation in the
       record that *** almost a month after the accident, [the insured] requested that [her son] be
       added to her policy, and that [the insurer] charged an additional $320 to add him.” Ratliff,
       257 Ill. App. 3d at 288-89.
¶ 60        We find these cases distinguishable. In Styzinski, the insurer’s underwriter testified that
       the insurer would have specifically excluded coverage for motorcycle injuries had the insured
       provided accurate responses. Styzinski, 332 Ill. App. 3d at 421. In Northern Life, the insured
       had been diagnosed with AIDS and intended to misrepresent. Northern Life, 234 Ill. App.
       3d at 802. The insurer’s underwriter stated that, had the insured disclosed his diagnosis, the
       insurer would have denied coverage “because AIDS was then, and is now, uninsurable.”
       (Emphasis added.) Northern Life, 234 Ill. App. 3d at 802. In these two cases, the
       misrepresentations were material because the insurers would have denied coverage had the
       insureds not made their misrepresentations. In the case at bar, DAI stated that it would not
       have issued the policy as written, and that Elia’s premium would have been higher. In
       addition, in its motion to reconsider, DAI submitted a document estimating what Elia’s
       premium would have been had DAI known that other potential drivers lived with Elia.
       Therefore, DAI cannot argue that it would have found Elia uninsurable had it known that she
       lived with other drivers.
¶ 61        In Ratliff, both the insured and her son operated the vehicle, despite the insured’s
       application disclosing only one driver. Ratliff, 257 Ill. App. 3d at 282-83. The risk insured
       against increased because the vehicle was regularly driven by twice as many people as were
       listed on the policy. Ratliff, 257 Ill. App. 3d at 288. However, in the case at bar, Elia, did not
       operate the Elia vehicle, despite being the named insurer. Elia testified in her unrebutted
       deposition that only Mario operated the Elia vehicle, and, thus, the number of drivers listed




                                                 -13-
       on the application matched the true number of drivers.4
¶ 62       DAI argues that Elia’s misrepresentations were material because the “status, number and
       character of the persons who are likely to be driving the [vehicle] with the owner’s
       permission” are relevant to the risk. Government Employees Insurance Co. v. Dennis, 90 Ill.
       App. 2d 356, 365 (1967). DAI’s argument rests on the “number” of drivers likely to be
       driving the Elia vehicle, and is premised on the assumption that Mario was a driver in
       addition to Elia. DAI relies on Elia’s deposition to prove that Mario lived with Elia on the
       effective date of the DAI policy, and thus that Elia had additional drivers in her home.
       However, Elia’s deposition repeatedly states that Elia cannot and does not drive, and that she
       purchased the Elia vehicle with the intention that Mario would drive it. Therefore, Elia’s
       deposition indicates that there was only one driver in her residence. As a result, there was no
       misrepresentation that “substantially increas[ed] the chances of the events insured against.”
       Northern Life, 234 Ill. App. 3d at 801. The application stated that only one driver of the Elia
       vehicle resided at Elia’s residence, and although the application listed this person as Elia, the
       fact that the true driver was in fact Mario did not increase the risk DAI insured against. The
       number of drivers likely to be driving the Elia vehicle was one. As we stated above, the
       number of drivers disclosed on the application matches the number of drivers who actually
       drove the Elia vehicle. Therefore, any misrepresentation by Elia was not material because she
       did not misstate the number of regular drivers of the Elia vehicle. Dennis, 90 Ill. App. 2d at
       365. Nor did the misrepresentation “substantially increas[e] the chances of the events insured
       against.” Northern Life, 234 Ill. App. 3d at 801. Most importantly, there is no showing that
       Elia intentionally misrepresented the facts. The policy should have been classified as a
       nonowned vehicle policy with an increase in premium.
¶ 63       In its motion for summary judgment, DAI relies on the affidavits of its claims manager
       and an NIN employee to support its arguments. DAI argues that the affidavits sufficiently
       establish that Elia’s misrepresentation was material. DAI relies on its claims manager’s
       affidavit to assert that “the [DAI] policy would not have been issued as written or would not
       have been issued at all” had DAI known of the inaccuracies on the application. (Emphasis
       added.) The affidavit states as follows:
                “I, Michael Torello, being first duly and lawfully sworn on my oath, depose and state
           that I have personal knowledge of the following facts, and that, if sworn as a witness
           hereto, I could competently and verily testify to the same:
                    1. that I am the claim’s [sic] manager of [DAI] and have been so employed in this
                capacity during all relevant times herein.

               4
                In its motion to reconsider, DAI argues that it was insuring three individuals: Elia, Mario,
       and Felipe Beltran (Felipe), Elia’s 23-year-old son. DAI does not mention Felipe in its motion for
       summary judgment. DAI mentions Felipe for the first time in its motion for reconsideration. Whether
       Felipe qualifies as a “driver” under the terms of the application is unclear. Elia testified in her
       deposition that, on the day of the deposition, she lived with Felipe. Elia does not testify that she lived
       with Felipe on the day she applied for the DAI policy. Elia also testified that Felipe never drove the
       Elia vehicle. In addition, there is no evidence in the record to indicate whether Felipe had a driver’s
       license.

                                                     -14-
                    2. that I have reviewed the Amended Complaint filed by [DAI], captioned above,
                incorporated fully herein and attached hereto with [DAI’s] Motion for Summary
                Judgment as Exhibit A, and verify the allegations contained therein are true and
                correct to the best of my knowledge.”
       The affidavit does nothing more than assert that the factual allegations are “true and correct
       to the best of [his] knowledge.” Furthermore, the amended complaint alleges that “[Elia] had
       other drivers [in her household]” at the time she made her application for insurance. This
       allegation is contrary to the facts testified to in Elia’s deposition, which DAI attaches as
       evidence to its motion for summary judgment. Elia’s unrebutted testimony, coupled with the
       facts surrounding the discrepancy, i.e., that the female, unlicensed Elia was listed as a male
       with an international driver’s license, that the applicant signature lines bear the notation,
       “T/O,”5 and that the application is written in English, a language that Elia does not speak,
       indicate that the sole error in the application was the name of the insured, which resulted
       from poor communication. The affidavit does not make more plausible the assertion that Elia
       was a driver of the Elia vehicle and that there was more than one regular driver of the Elia
       vehicle.
¶ 64        DAI relies on the affidavit of NIN employee Linda Robnett to assert that NIN is not an
       agent of DAI.6 Acuity asks that we not consider Robnett’s affidavit, arguing that it does not
       comply with Illinois Supreme Court Rule 191(a). Rule 191(a) requires that affidavits “shall
       be made on the personal knowledge of the affiants; shall set forth with particularity the facts
       upon which the claim, counterclaim, or defense is based; shall have attached thereto sworn
       or certified copies of all documents upon which the affiant relies.” Ill. S. Ct. R. 191(a) (eff.
       July 1, 2002). Robnett’s affidavit does not aver that the statements made in her affidavit are
       based upon her personal knowledge. Robnett asserts that Elia “chose [DAI] as her insurer
       from a host of insurers available,” but also asserts that “NIN received the application for
       [Elia’s] insurance through an automobile dealership” and that “NIN’s records do not reflect
       any communications with [Elia], other that [sic] the application submitted.” Robnett does not
       assert how she knew that Elia selected DAI as her insurer if no one at NIN ever
       communicated with her. Furthermore, Robnett’s affidavit makes reference to NIN
       documents, but no documents are attached to the affidavit. As a result, Robnett’s affidavit
       fails to comply with the requirements of Rule 191(a).
¶ 65        DAI also argues that, because certain defendants, including Elia and Mario, are in default,
       the allegations in the complaint are admitted against them and may be used as evidence. DAI


               5
                Acuity asserts that “T/O” indicates that the application was made over the phone, and DAI
       does not dispute this assertion.
               6
                 The parties argue in their briefs that whether or not NIN was an agent of DAI is relevant
       to this case. NIN was the agent of Elia for the obtaining of the insurance and may have been the
       agent of DAI for payment. A&B Freight Line, Inc. v. Ryan, 216 Ill. App. 3d 1093, 1097 (1991)
       (holding that under certain circumstances, independent insurance agents may be agents of both
       insurer and insured). However, since we find that the misrepresentation was not material, it has no
       effect on our decision-making process.

                                                  -15-
       insists that it is not arguing that the allegations in its complaint are admitted against Acuity
       and the Obermanns, but rather that the allegations are now evidence that Acuity and the
       Obermanns must “meet and overcome.”
¶ 66       A default admits the facts alleged against a defendant in the complaint to be true. People
       v. $1,124,905 U.S. Currency & One 1988 Chevrolet Astro Van, 177 Ill. 2d 314, 334 (1997).
       A default does not admit the conclusions present in the complaint. $1,124,905 U.S.
       Currency, 177 Ill. 2d at 334. A default for failure to plead is effective against only the party
       in default. Universal Casualty Co. v. Lopez, 376 Ill. App. 3d 459, 464 (2007). After a trial
       court enters an order of default, the trial court has the discretion to hold a “prove-up” hearing,
       at which the plaintiff must present proof of the factual allegations in its complaint. American
       Service Insurance Co. v. City of Chicago, 404 Ill. App. 3d 769, 779 (2010). If the plaintiff
       fails to meet its burden of proof at the prove-up hearing, the trial court may refuse to enter
       a default judgment. American Service Insurance Co., 404 Ill. App. 3d at 779.
¶ 67       DAI argues that, although the factual allegations of the complaint have not been admitted
       against Acuity and the Obermanns, the factual allegations have been admitted against Elia
       and Mario, and are thus evidence. DAI asserts that Acuity and the Obermanns must now
       “meet and overcome” that evidence to defeat DAI’s motion to dismiss. In essence, DAI is
       arguing that because facts in the complaint are deemed judicially admitted against some
       parties, those facts are to be treated as presumptively proven against the nondefaulting
       defendants, and the nondefaulting defendants now have the burden to rebut the presumption.
¶ 68       DAI cites the Illinois Supreme Court case of Chamblin v. Chamblin, 362 Ill. 588 (1936)
       to bolster its point. However, DAI’s reading of Chamblin is unpersuasive. First, Chamblin
       explicitly states that “[t]he default of one defendant is not an admission by the others, and
       does not relieve the complainant from the necessity of establishing his case against those who
       appear and plead.” Chamblin, 362 Ill. at 593. Next, DAI relies upon a passage in Chamblin
       that states that nondefaulting defendants “may meet and overcome, if they can, the evidence
       of the complainant.” Chamblin, 362 Ill. at 593. However, DAI excludes the first clause of
       the sentence, which states that complainants must “prove the issues to the answering
       defendants.” (Emphasis added.) Chamblin, 362 Ill. at 593.
¶ 69       To treat the factual allegations of a complaint as “evidence” under DAI’s reasoning
       would be to place an improper burden upon nondefaulting defendants. Nondefaulting
       defendants would be subjected to a higher burden as a result of the conduct of the defaulting
       defendants, which is out of the control of nondefaulting defendants.

¶ 70                                III. Motion to Reconsider
¶ 71       DAI also argues that the trial court improperly denied its motion to reconsider. The
       intended purpose of a motion to reconsider is to bring to the court’s attention newly
       discovered evidence, changes in the law, or errors in the court’s previous application of the
       existing law. In re Marriage of Epting, 2012 IL App (1st) 113727, ¶ 41. “Newly discovered
       evidence” is evidence that was not available prior to the hearing. Emrikson v. Morfin, 2012
       IL App (1st) 111687, ¶ 30. “In the absence of a reasonable explanation regarding why the
       evidence was not available at the time of the original hearing, the circuit court is under no

                                                 -16-
       obligation to consider it.” Emrikson, 2012 IL App (1st) 111687, ¶ 30.
¶ 72        DAI asserts in its motion to reconsider that the trial court erred in its application of the
       law. However, DAI does not explain how the trial court misapplied the law when it granted
       defendants’ motion for summary judgment and denied DAI’s motion. Instead, DAI reasserts
       its arguments from its motion for summary judgment. DAI also attached a print-out
       comparing the cost of the premium DAI would have charged had DAI been insuring more
       than one individual with the premium actually charged. We have stated above that the DAI
       policy did in fact cover only one person: Mario. However, even if that were not true, the trial
       court could not consider it because DAI gave no explanation as to why it did not previously
       attach such a document to its motion for summary judgment. “ ‘Trial courts should not allow
       litigants to stand mute, lose a motion and then frantically gather evidentiary material to show
       that the court erred in its ruling.’ ” (Internal quotation marks omitted.) River Plaza
       Homeowner’s Ass’n v. Healey, 389 Ill. App. 3d 268, 280 (2009) (quoting North River
       Insurance Co. v. Grinnell Mutual Reinsurance Co., 369 Ill. App. 3d 563, 572-73 (2006)).
       DAI also attached to its motion to reconsider a new affidavit from a DAI employee, who
       argued that the misrepresentation was material because Mario’s driving record might have
       precluded DAI from covering him. However, no driving record is included in the record on
       appeal. For the same reason, the trial court could not properly consider the affidavit.
¶ 73        In a written order, the trial court found that “[t]here was only one licensed, male driver
       in the residence at the time of the application.” The trial court further found that if the
       application had included Mario’s name instead of Elia’s, Mario “would not have been
       required to disclose that Elia lived in the residence with him because she was not a licensed
       driver, according to the application form questions.” The trial court found no evidence of any
       indicators that insuring Mario would have negatively affected DAI’s risk, such as a bad
       driving record. We find no such evidence in the record, and therefore, we cannot say that the
       trial court abused its discretion in denying the motion for reconsideration.

¶ 74                                     CONCLUSION
¶ 75      For the foregoing reasons, the trial court properly granted summary judgment in favor of
       Acuity and denied summary judgment in favor of DAI.

¶ 76       Affirmed.




                                                 -17-
