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                                     Appellate Court                           Date: 2018.03.14
                                                                               13:13:59 -05'00'




                  Cherry v. Elephant Insurance Co., 2018 IL App (5th) 170072



Appellate Court          AUSTIN L. CHERRY and LESLEY TAYLOR, Plaintiffs-
Caption                  Appellants, v. ELEPHANT INSURANCE COMPANY, INC., d/b/a
                         Elephant Auto Insurance, Defendant-Appellee.



District & No.           Fifth District
                         Docket No. 5-17-0072



Filed                    January 31, 2018



Decision Under           Appeal from the Circuit Court of Massac County, No. 16-MR-10; the
Review                   Hon. Joseph Jackson, Judge, presiding.



Judgment                 Reversed.


Counsel on               James R. Lambert and Stephen W. Stone, of Howerton, Dorris, Stone
Appeal                   & Lambert, of Marion, for appellants.

                         Joseph T. Madrid, of Shelton & Madrid, LLC, of St. Louis, Missouri,
                         for appellee.



Panel                    JUSTICE WELCH delivered the judgment of the court, with opinion.
                         Justices Cates and Moore concurred in the judgment and opinion.
                                             OPINION

¶1        The plaintiffs, Austin Cherry (Cherry) and Lesley Taylor (Taylor), were injured when
     Cherry’s vehicle was struck by an underinsured driver on June 6, 2015, in Massac County,
     Illinois. His vehicle was insured by the defendant, Elephant Insurance Company (Elephant).
     Both plaintiffs settled their bodily injury claims with the at-fault driver’s automobile insurer
     for $25,000, though their damages far exceeded that amount. The plaintiffs filed a complaint
     for declaratory judgment against Elephant on February 9, 2016, asking the circuit court to find
     that Elephant’s policy provides $300,000 in underinsured motorist coverage to both plaintiffs,
     as the policy allowed aggregation of the liability limits of the underinsured motorist coverage
     on four vehicles. The plaintiffs filed a motion for summary judgment on July 13, 2016, and
     Elephant filed a motion for summary judgment on August 30, 2016. On February 27, 2017, the
     circuit court entered an order denying the plaintiffs’ motion and granting Elephant’s motion.
     For the following reasons, we reverse the judgment of the circuit court.
¶2        At the time of the accident, Cherry was driving a 2008 Ford Focus with Taylor as his
     passenger. Cherry was insured under a policy issued by Elephant. At the plaintiffs’ request,
     Christy Parks, a product compliance specialist for Elephant, sent them a certified copy of the
     policy on November 6, 2015. This copy, which was attached to the plaintiffs’ complaint for
     declaratory judgment, included the declarations page, cover page, and the policy details.
¶3        The policy was issued to Richard Cherry, Austin Cherry’s father, for a period extending
     from January 12, 2015, to January 12, 2016. The drivers listed on the policy declaration page
     are Richard A. Cherry, Amy Cherry, Austin Cherry, and Israel Cherry. On the next two sheets
     of the declaration page, under “Coverage Outline,” the policy shows four insured vehicles: the
     2008 Ford Focus that Cherry was driving at the time of the accident, a 2010 Kia Soul, a 2010
     Ford Flex, and a 2006 BMW 330. The policy charged four separate premiums, one for each
     vehicle. The coverage type and the corresponding limits of liability are listed separately for
     each vehicle. Each vehicle under the policy carried coverage for “uninsured/underinsured
     motorist—bodily injury” with a limit listed as “$25,000/$50,000.” For clarity, the declaration
     pages in their original formatting are included at the end of this opinion.
¶4        Following the declaration pages, the policy has a cover page titled “Illinois Personal Auto
     Policy.” In the bottom left corner, in smaller type, the page reads:
                  “READ YOUR POLICY, DECLARATIONS, AND ENDORSEMENTS
              CAREFULLY
                  The automobile insurance contract between the named insured and Elephant
              consists of this policy, plus the declarations page and any applicable endorsements.
                  The policy provides the coverages, and amounts of insurance are shown on the
              declarations when premium is charged.”
     After a table of contents, the first paragraph in the policy, titled “AUTO POLICY,” states:
              “This policy is a contract between the named insured shown on the declarations page
              and us. This contract, the declarations page, your Application and any endorsements
              that apply to this contract contain all of the agreements between you and us. If you pay
              the required premium when due, we will provide the insurance described in this
              contract.”
     After listing general definitions, the policy is divided into parts. Part A describes liability
     coverage, part B describes medical payments coverage, part C describes
                                                 -2-
     uninsured/underinsured motorist coverage, part D describes damage to an auto (collision
     coverage), and part E describes roadside assistance coverage.
¶5       In part C’s description of uninsured/underinsured motorist coverage, under “LIMITS OF
     LIABILITY,” the policy states:
             “There will be no stacking or combining of coverage afforded to more than one auto
             under this policy. The limit of liability shown on the declarations page for the
             coverages under Part C is the most we will pay regardless of the number of:
                  1. Claims made;
                  2. Covered autos;
                  3. Autos and trailers shown on the declarations page;
                  4. Insureds;
                  5. Lawsuits filed;
                  6. Motor vehicles and trailers involved in an accident;
                  7. Heirs or survivors of person with bodily injury; or
                  8. Premiums paid.”
¶6       The next paragraph states that “[i]f more than one policy of uninsured or underinsured
     motorist coverage applies to an accident, the maximum the Insured may recover from all of the
     applicable coverage is the highest limit available under one policy for one auto.”
¶7       As previously mentioned, a dispute arose between the parties regarding the amount of
     underinsured motorist coverage available to Cherry and Taylor under this policy. In its motion
     for summary judgment, Elephant argued that the underinsured motorist coverage limits are
     $25,000 per person and $50,000 per occurrence, citing the declarations page, the cover page,
     and Richard Cherry’s application, which lists uninsured/underinsured motorist coverage with
     limits of liability of $25,000 per person and $50,000 per accident. Elephant also argued that the
     policy clearly and unambiguously prohibits the stacking of underinsured motorist coverage by
     stating that “[t]here will be no stacking or combining of coverage afforded to more than one
     auto under this policy.” Elephant concluded that because each plaintiff settled with the
     underlying tortfeasor for $25,000, no underinsured motorist coverage claim exists because the
     tortfeasor’s limits are not less than the insured’s limits, and therefore, the tortfeasor’s vehicle is
     not considered underinsured by statute. Attached to Elephant’s motion was a copy of Richard
     Cherry’s insurance application, along with copies of the declarations page and the policy.
¶8       The plaintiffs responded that the certified copy of the policy sent to them did not include
     the application and, as such, any reference to the application should be disallowed or
     considered an impermissible introduction of parol evidence. The plaintiffs argued that,
     because the limits of liability for underinsured motorist coverage on the declarations sheet
     were listed multiple times, the policy was ambiguous as to whether the plaintiffs may combine
     the limits of all the vehicles insured under the policy. The plaintiffs maintained that the
     policy’s language does not clearly prohibit stacking and the language pointed to by Elephant
     does not clearly and definitively clarify the ambiguity. The trial court found in favor of
     Elephant, and the plaintiffs appeal.
¶9       The issue in this case is whether the underinsured motorist coverage on the four vehicles
     insured by Elephant may be stacked, despite the antistacking language in the relevant section
     of the policy. Elephant maintains that the limit of liability for underinsured motorist coverage
     is $25,000 per person and $50,000 per accident and that the coverages may not be stacked

                                                   -3-
       because the antistacking provisions are clear and unambiguous. The plaintiffs respond that
       listing multiple limits on the declarations page creates an ambiguity that is not cured by
       Elephant’s antistacking clause, which prohibits the combining of coverages, as opposed to
       prohibiting the combining of the limits of liability. We agree with the plaintiffs.
¶ 10        In an appeal from the grant of a summary judgment, we conduct a de novo review. Crum &
       Forster Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 390 (1993). The
       construction of an insurance policy is a question of law and is an appropriate subject for
       disposition by way of a summary judgment. Johnson v. Davis, 377 Ill. App. 3d 602, 606
       (2007).
¶ 11        An insurance policy is a contract, and the general rules governing the interpretation of
       other types of contracts also govern the interpretation of insurance policies. Hobbs v. Hartford
       Insurance Co. of the Midwest, 214 Ill. 2d 11, 17 (2005). In general, antistacking clauses do not
       contravene public policy. Grzeszczak v. Illinois Farmers Insurance Co., 168 Ill. 2d 216, 229
       (1995). The Illinois Insurance Code (Code) authorizes antistacking provisions of underinsured
       motorist coverage in automobile insurance policies. The underinsured motorist statute
       provides:
                “Nothing herein shall prohibit an insurer from setting forth policy terms and conditions
                which provide that if the insured has coverage available under this Section under more
                than one policy or provision of coverage, any recovery or benefits may be equal to, but
                may not exceed, the higher of the applicable limits of the respective coverage, and the
                limits of liability under this Section shall not be increased because of multiple motor
                vehicles covered under the same policy of insurance.” 215 ILCS 5/143a-2(5) (West
                2014).
¶ 12        Where the terms of a policy are clear and unambiguous, the language used will be given its
       plain meaning; however, if a provision is subject to more than one reasonable interpretation, it
       is ambiguous and should be construed against the insurer and in favor of the insured. Murphy v.
       State Farm Mutual Automobile Insurance Co., 234 Ill. App. 3d 222, 225 (1992). The reasons
       behind interpreting an insurance policy in this way are twofold: (1) an insured’s intent in
       obtaining insurance is to have coverage, and thus, any ambiguity jeopardizing coverage should
       be construed consistent with the insured’s intent, and (2) it is the insurer who is the drafter of
       the policy, and the insurer could have drafted the ambiguous provision clearly and specifically.
       Id. at 226. Therefore, attempts to limit or exclude coverage must be done clearly,
       unambiguously, and free of any doubt as to the intended meaning. Lenkutis v. New York Life
       Insurance Co., 374 Ill. 136, 140 (1940).
¶ 13        In determining whether an ambiguity exists, all of the provisions in an insurance contract
       should be read together. Glidden v. Farmers Automobile Insurance Ass’n, 57 Ill. 2d 330, 336
       (1974). Reasonableness is the key, and the touchstone is whether the provision is subject to
       more than one reasonable interpretation, not whether creative possibilities can be suggested.
       Bruder v. Country Mutual Insurance Co., 156 Ill. 2d 179, 193 (1993); Johnson, 377 Ill. App.
       3d at 607.
¶ 14        After reviewing the policy as a whole, we find that the policy is ambiguous as to whether
       the limits of liability may be stacked. We reach this conclusion from an analysis of Bruder and
       its progeny.
¶ 15        In Bruder, the Illinois Supreme Court considered whether a plaintiff should be allowed to
       stack uninsured motorist coverage on two vehicles set forth on a single automobile policy. 156

                                                   -4-
       Ill. 2d at 191. The policy’s limit of liability for uninsured benefits provided that “ ‘[t]he most
       we will pay for all damages resulting from bodily injury to any one person caused by any one
       accident is the limit of Bodily Injury shown in the declarations for “Each Person.” ’ ” Id. at
       189. The court held that there was no ambiguity when the antistacking clause was read in
       conjunction with the declarations page because the limit of the bodily injury for “each person”
       (in the amount of $100,000) was set forth only once on the declarations page, despite listing
       two vehicles. Id. at 193-94. The court noted, however, that multiple printings of policy limits
       on a declarations page could create an ambiguity, stating:
                     “It would not be difficult to find an ambiguity created by such a listing of the bodily
                injury liability limit for each person insured. *** There would be little to suggest in
                such a listing that the parties intended that coverage was to be limited to that provided
                for only one of the two [vehicles]. It would be more reasonable to assume that the
                parties intended that, in return for the two premiums, two *** coverage amounts were
                afforded.” Id. at 192.
       In other words, the court opined that such a policy could easily be interpreted as providing a
       total limit of $200,000 because a figure of $100,000 would be shown for each vehicle. Id.
       However, in the case before it, because the policy listed only one limit of liability on the
       declarations page, it could only reasonably be read as providing that amount and was therefore
       unambiguous.
¶ 16        Courts interpreting Illinois law, including this court, have followed the Bruder rationale
       and found that, despite indication elsewhere in the contract that stacking of policy limits is not
       permitted, a declarations page that prints the policy limit more than once could reasonably be
       interpreted as providing a policy limit that is the sum of the printed limits. See Allen v.
       Transamerica Insurance Co., 128 F.3d 462, 466-67 (7th Cir. 1997) (the policy’s limit of
       liability section directed the insured to find the limit of underinsured coverage in the
       declarations, where multiple numerical limits appeared; the limit of liability clause could thus
       be read multiple ways, rendering the meaning ambiguous and aggregation to result); Pekin
       Insurance Co. v. Estate of Goben, 303 Ill. App. 3d 639, 648-49 (5th Dist. 1999) (same); Yates
       v. Farmers Automobile Insurance Ass’n, 311 Ill. App. 3d 797, 800 (5th Dist. 2000) (same).
¶ 17        The Illinois Supreme Court returned to this issue in Hobbs v. Hartford Insurance Co. of the
       Midwest, 214 Ill. 2d 11 (2005). The court noted the similarities between the insurance policy at
       issue and the Bruder policy, noting that, in both cases, the antistacking clauses tied the limit of
       liability to the limit shown in the declarations page and both policies’ declarations pages listed
       the premiums for two vehicles separately “but, importantly, list[ed] the relevant limit of
       liability only once.” Id. at 21. The court read the antistacking provision in conjunction with the
       declarations page and determined that the policy in question was unambiguous and that the
       coverages did not stack. Id. The Hobbs court noted that listing multiple numerical limits on the
       policy’s declaration page does not per se result in aggregation, and variances in policy
       language “frequently require case-by-case review.” Id. at 26 n.1. However, the court reiterated
       its statement in Bruder that “where the antistacking clause limits liability to the limit shown on
       the declarations page, and the declarations page lists the limit of liability twice, it would not be
       difficult to find an ambiguity.” Id. at 25 (citing Bruder, 156 Ill. 2d at 192).
¶ 18        Finally, relying on Bruder, Allen, Estate of Goben, and Yates, this court determined in
       Johnson v. Davis that stacking was allowed under the policy in question because the limits of
       the coverage were listed multiple times, once for each vehicle covered, and four separate
       premiums for the coverage were also listed on the declarations sheet. 377 Ill. App. 3d 602, 609
                                                     -5-
       (2007). In Johnson, the four vehicles under the policy carried underinsured motorist coverage
       of $50,000 per person and $100,000 per accident. Id. at 603. The policy contained a general
       antistacking provision. Id. at 605-06. The underinsured motorist endorsement directed the
       insured to “ ‘SEE DECLARATION FOR LIMIT OF LIABILITY AND PREMIUM,’ ” and
       the endorsement also contained a limit of liability clause stating that the limit of liability shown
       in the declarations page was the maximum limit of liability. Id.
¶ 19       The declarations page showed limits of $50,000 per person, and those limits were listed
       four separate times. Id. at 610. Applying the case-by-case review directed by Hobbs, this court
       found that a reasonable person could believe that the policy provided $50,000 of underinsured
       motorist coverage for each of the four vehicles carrying underinsured motorist coverage, for a
       total of $200,000 in underinsured motorist coverage. Id. at 609. This court found that the
       antistacking clauses in the policy created an ambiguity when read with the declarations page
       and affirmed the trial court’s decision granting plaintiff Johnson $200,000 in underinsured
       motorist coverage. Id. at 610.
¶ 20       Here, like the cases described above, the policy’s limit of liability section directs the
       insured to find the limit of underinsured coverage in the declarations under the limit of liability
       section for underinsured motorist coverage; specifically, this policy states that “[t]he limit of
       liability shown on the declarations page for the coverages under Part C is the most we will
       pay.” Then, like the above-discussed cases, the declarations page lists four vehicles with four
       separate limits of liability. The abundant case law precedent indicates that this creates an
       ambiguity favoring aggregation of the four vehicles’ limits of liability for underinsured
       motorist coverage.
¶ 21       We remain mindful that “there is no per se rule that listing the numerical limits more than
       once on the declarations page creates an ambiguity which results in allowing the policies to be
       stacked.” Id. at 609. Further, although we recognize that the policy has specific antistacking
       language stating that “[t]here will be no stacking or combining of coverage afforded to more
       than one auto under this policy,” this clause does nothing to cure the ambiguity created by its
       limit of liability clause combined with the multiple listed limits on the declarations page.
¶ 22       On the declarations page, under each of the four vehicles, there are four columns with five
       rows of coverage descriptors. Below, we have reproduced the coverage outline details for the
       2008 Ford Focus.1
                Coverage Type                 Limits              Deductible           Premium

               Bodily Injury Liability      $25,000/$50,000                       $155.15
               Property Damage Liability $25,000                                  $137.08
               Uninsured/Underinsured
               Motorist—Bodily Injury       $25,000/$50,000                       $16.19
               Other Than Collision                           $100                $196.61
               Collision                                      $500                $482.48
       As mentioned above, the policy’s antistacking language stated that there will be no stacking or
       combining of “coverage.” Based on the above coverage outline details, a logical conclusion is
       that these five coverages cannot be stacked with any of the other coverages; e.g., an insured

           The formatting in our example is not exact. Please refer to the copy of the policy’s declarations
           1

       page included in this opinion’s appendix for an exact replica.
                                                     -6-
       may not combine his “property damage liability” with his “other than collision” liability.
       Meanwhile, there is no blanket prohibition on combining the limits of the available coverage.
       In other words, the ambiguity created by printing multiple limits on the declarations page is not
       cured by language prohibiting the combining of coverages and not the limits of liability.
       “Coverage” and “limit of liability” of that particular coverage are not synonymous terms. The
       language is plainly susceptible to more than one reasonable interpretation—the insured may be
       prohibited from combining his different coverages, or he may be prohibited from aggregating
       the limits of his coverages, despite paying premiums for them all.
¶ 23        In support of its position, Elephant cites State Farm Mutual Automobile Insurance Co. v.
       McFadden, in which the Second District prohibited aggregation. 2012 IL App (2d) 120272,
       ¶ 39. In McFadden, an insured wished to aggregate underinsured limits of liability on five
       separate policies insuring five separate vehicles. Id. ¶ 5. State Farm argued that its antistacking
       provisions limited underinsured coverage to the highest single policy, citing language in the
       policy that “ ‘[i]f underinsured motor vehicle coverage for bodily injury is available to an
       insured from more than one policy provided by us or any other insurer, the total limit of
       liability available from all policies provided by all insurers shall not exceed the limit of liability
       of the single policy provided the highest limit of liability.’ ” (Emphasis omitted.) Id. ¶ 15. The
       court found that while reading the declarations sheets in isolation might leave open the
       question of stacking, the antistacking provision unambiguously answered the question in the
       negative. Id. ¶ 36.
¶ 24        We do not find Elephant’s supporting case law persuasive. The antistacking language in
       McFadden involves an issue not before this court; that is, whether limits of liability on multiple
       separate policies may be aggregated. Elephant has a similar provision in its policy dealing with
       multiple insurance policies applicable to an accident, which states that “[i]f more than one
       policy of uninsured or underinsured motorist coverage applies to an accident, the maximum
       the Insured may recover from all of the applicable coverage is the highest limit available under
       one policy for one auto.” As there is not “more than one policy” of underinsured motorist
       coverage in the instant case, we find that McFadden is inapposite to our conclusion.
¶ 25        Elephant also argues that the application for the Elephant policy, read in conjunction with
       the declarations and the policy, makes clear that the coverage available for underinsured
       motorist coverage is $25,000 per person and $50,000 per accident. Elephant points to the first
       page of the insurance policy, which states that, “[t]his contract, the declarations page, your
       Application and any endorsements that apply to this contract contain all of the agreements
       between you and us.”
¶ 26        An insurance policy must be interpreted from examination of the complete document.
       Hobbs, 214 Ill. 2d at 23. However, as the plaintiffs properly point out, the application was not
       included in the certified copy of the policy sent to the plaintiffs, and the title page of the
       certified policy states that “[t]he automobile insurance contract between the named insured and
       Elephant consists of this policy, plus the declarations page and any applicable endorsements.”
       This policy statement directly conflicts with the subsequent policy statement that the
       application is included in “all of the agreements between [Richard Cherry] and [Elephant].”
       Again, an ambiguity is created when the insured reads these statements together. Moreover,
       Elephant’s reference to the application ignores the language on the title page following the
       initial statement, which states that “amounts of insurance are shown on the declarations,”
       which corresponds with Elephant’s directions in the limit of liability clause for the insured to
       find the limits in the declarations page.
                                                     -7-
¶ 27        The Code authorizes Elephant to limit its liability in providing underinsured motorist
       coverage to a single amount, despite collecting premiums for multiple amounts. See 215 ILCS
       5/143a-2(5) (West 2014). However, Elephant is required to clearly and unambiguously inform
       its policyholders that their coverage has limitations or exclusions. Elephant failed to do so, and
       the ambiguity created by this failure must be construed against the insurer and in favor of the
       insured. See Murphy, 234 Ill. App. 3d at 225. As such, the limits of liability of the four vehicles
       aggregate to provide $100,000/$200,000 of underinsured motorist coverage.
¶ 28        We turn now to the question of the amount of coverage to which the plaintiffs are actually
       entitled. In the policy’s description of uninsured/underinsured motorist coverage, under
       “LIMITS OF LIABILITY,” the policy states:
                    “If the declarations page shows one limit under this coverage for each person and
                another limit for each accident, the following limits shall apply to each accident:
                        1. The amount shown for ‘each person’ is the most we will pay for all damages
                    due to a bodily injury to one person;
                        2. Subject to the ‘each person’ limit, the amount shown for ‘each accident’ is
                    the most we will pay for all damages due to bodily injury sustained by two or more
                    persons in any one accident.”
¶ 29        Thus, the policy states, if the declarations page shows one limit for “each person” and one
       limit for “each accident,” different payment terms apply. However, the plaintiffs point out that
       when the limit of liability and the declarations are read together, “$25,000/$50,000” are the
       amounts encountered under the “Limits” column of uninsured/underinsured motorist
       coverage—there is no reference to “each person” or “each accident” anywhere on the
       declarations page. Thus, the plaintiffs argue, while one reasonable interpretation of the limit of
       liability is $25,000 per person and $50,000 per accident, another reasonable interpretation,
       based on the formatting of the page, is that the limits are $25,000 for uninsured bodily injury
       and $50,000 for underinsured bodily injury.
¶ 30        Again, the relevant row appears on the declarations page as the following:
                “Uninsured/Underinsured Motorist—Bodily Injury            $25,000/$50,000”
       Uninsured and underinsured coverage are stated on the same row, separated by a slash. The
       amounts of $25,000 and $50,000, directly across from these coverages and having no
       indication of a “per person” or “per accident” designation, also are separated by a slash. We
       agree with the plaintiffs that both interpretations are reasonable. Again, where there is more
       than one reasonable interpretation of a provision, it is ambiguous and will be construed against
       the insurer and in favor of the insured. Murphy, 234 Ill. App. 3d at 225.
¶ 31        Therefore, as the policy does not unambiguously prohibit aggregation, nor does it
       unambiguously state the amounts of the underinsured limits when the policy’s limits of
       liability clauses and the declarations page are read together, we find that the plaintiffs could
       reasonably conclude that Richard Cherry had purchased $50,000 of underinsured benefits four
       times, resulting in $200,000 of underinsured motorist coverage for each plaintiff. We therefore
       find that the plaintiffs are each entitled to that amount of coverage.
¶ 32        For the foregoing reasons, we reverse the decision of the Massac County circuit court and
       aggregate the underinsured motorist benefits available to the plaintiffs in this case.

¶ 33      Reversed.

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¶ 34   APPENDIX




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