                                               2015 IL App (1st) 140548
                                                    No. 1-14-0548
                                                                        Fifth Division
                                                                        June 26, 2015
     ______________________________________________________________________________

                                         IN THE
                             APPELLATE COURT OF ILLINOIS
                                     FIRST DISTRICT
     ______________________________________________________________________________

                                                    )
     FIRST CHICAGO INSURANCE COMPANY,               )
     f/k/a Chicago Mutual Insurance Company,        )   Appeal from the Circuit Court
                                                    )   of Cook County.
           Plaintiff-Appellant,                     )
                                                    )   No. 08 CH 15285
     v.                                             )
                                                    )   The Honorable
     MICHAEL MOLDA and NOLA WILSON,                 )   John Griffin,
                                                    )   Judge Presiding.
           Defendants-Appellees.                    )
                                                    )
     ______________________________________________________________________________

                      JUSTICE GORDON delivered the judgment of the court, with opinion.
                      Justices McBride and Reyes concurred in the judgment and opinion.

                                                        OPINION

¶1         The instant appeal arises from the trial court’s finding, after a bench trial, that plaintiff

        First Chicago Insurance Company (First Chicago) owed a duty to defend defendant Michael

        Molda in a personal injury lawsuit filed by Nola Wilson concerning an automobile collision

        between Molda and Wilson. 1 First Chicago appeals, arguing that Molda was not covered by

        the insurance policy at issue because he was not a covered party and that Molda failed to

        provide timely notice of his accident. For the reasons that follow, we affirm.




           1
               Molda did not file a separate brief on appeal but adopted Wilson’s brief.
     No. 1-14-0548


¶2                                               BACKGROUND

¶3           On May 24, 2008, First Chicago filed a complaint for declaratory judgment against

         Molda; Wilson; and Metrolift, Inc. (Metrolift), Molda’s employer. 2 The complaint alleged

         that Molda was an employee of Metrolift and was involved in an automobile collision with

         Wilson on August 17, 2005, at the intersection of Roosevelt Road and 11th Avenue in

         Broadview. As a result of the collision, Wilson filed a lawsuit against Molda, later amending

         her complaint to name Metrolift as an additional defendant. At the time of Molda’s accident,

         Metrolift was insured under an automobile liability insurance policy issued by First Chicago.

¶4           Count I of the complaint was entitled “Late Notice of Lawsuit,” and alleged that, “[t]o the

         extent it is determined that MOLDA is an insured” under the First Chicago insurance policy,

         Molda was contractually obligated to forward any lawsuit papers to First Chicago

         “ ‘immediately.’ ” Count I alleged that Molda was served with the Wilson lawsuit on October

         11, 2007, but First Chicago did not receive notice of the lawsuit until March 26, 2008. Count

         I further alleged that “[b]y failing to provide notice to [First Chicago] of the WILSON

         lawsuit immediately, MOLDA breached and violated the terms and conditions precedent to

         coverage under the [First Chicago] Policy.” Accordingly, count I alleged that First Chicago

         owed no duty to defend or indemnify Molda in connection with the Wilson litigation and

         owed Wilson no monetary compensation under the First Chicago policy.

¶5           Count II of the complaint was entitled “Late Notice of Loss” and alleged that First

         Chicago’s first notice of the August 17, 2005, accident was on March 26, 2008, and that

         “[b]y failing to provide notice to [First Chicago] of the August 17, 2005 accident promptly,

         MTEROLIFT and MOLDA breached and violated the terms and conditions precedent to

             2
               Metrolift was voluntarily dismissed on September 30, 2009, after agreeing to be bound by any final
     judgment in the matter.

                                                             2
     No. 1-14-0548


        coverage under the [First Chicago] Policy,” which required prompt notice of any accidents.

        Accordingly, count II alleged that First Chicago owed no duty to defend or indemnify

        Metrolift or Molda in connection with the Wilson lawsuit and owed Wilson no monetary

        compensation under the First Chicago policy.

¶6         Attached to First Chicago’s complaint was a copy of the insurance policy at issue. The

        policy contained a list of nine categories of “covered autos,” and the declarations page

        indicated that Metrolift had purchased liability insurance coverage for categories 7, 8, and 9.

        Category 7 was described as: “SPECIFICALLY DESCRIBED AUTOS. Only those autos

        described in ITEM FOUR for which a premium charge is shown (and for liability coverage

        for any trailers you don’t own while attached to any power unit described in ITEM FOUR).”

        Category 8 was described as: “HIRED AUTOS ONLY. Only those autos you lease, hire, rent

        or borrow. This does not include any auto you lease, hire, rent, or borrow from any of your

        employees or members of their households.” Category 9 was described as: “NONOWNED

        AUTOS ONLY. Only those autos you do not own, lease, hire or borrow which are used in

        connection with your business. This includes autos owned by your employees or members of

        their house-holds but only while used in your business or your personal affairs.” The policy

        stated that the terms “ ‘you’ and ‘your’ ” referred to the named insured, in this case,

        Metrolift.

¶7         The policy stated that “[t]he following are ‘insureds’ ” under the policy:

                     “a. You for any covered ‘auto’.

                     b. Anyone else while using with your permission a covered ‘auto’ you own, hire

               or borrow except:




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     No. 1-14-0548


                        (1) The owner or anyone else from whom you borrow a covered ‘auto’. This

                     exception does not apply if the covered ‘auto’ is a ‘trailer’ connected to a covered

                     ‘auto’ you own.

                        (2) Your employee if the covered ‘auto’ is owned by that employee or a

                     member of his or her household.

                        (3) Someone using a covered ‘auto’ while he or she is working in a business

                     of selling, servicing, repairing, parking or storing ‘autos’ unless that business is

                     yours.

                        (4) Anyone other than your employees, partners, a lessee or borrower or any

                     of their employees, while moving property to or from a covered ‘auto’.

                        (5) A partner of yours for a covered ‘auto’ owned by him or her or a member

                     of his or her household.

                     c. Anyone liable for the conduct of an ‘insured’ described above but only to the

              extent of that liability.”

¶8         The policy also provided for “Duties in the Event of Accident, Claim, Suit or Loss”:

                     “a. In the event of ‘accident’, claim, ‘suit’ or ‘loss’, you must give us or our

              authorized representative prompt notice of the ‘accident’ or ‘loss’. Include:

                        (1) How, when and where the ‘accident’ or ‘loss’ occurred;

                        (2) The ‘insured’s’ name and address; and

                        (3) To the extent possible, the names and addresses of any injured persons and

                     witnesses.

                     b. Additionally, you and any other involved ‘insured’ must:



                                                       4
       No. 1-14-0548


                            (1) Assume no obligation, make no payment or incur no expense without our

                        consent, except at the ‘insured’s’ own cost.

                            (2) Immediately send us copies of any request, demand, order, notice,

                        summons or legal paper received concerning the claim or ‘suit’.

                            (3) Cooperate with us in the investigation, settlement or defense of the claim

                        or ‘suit’.

                            (4) Authorize us to obtain medical records or other pertinent information.

                            (5) Submit to examination, at our expense, by physicians of our choice, as

                        often as we reasonably require.”

¶9           On October 13, 2009, Molda filed a counterclaim and third-party complaint for

          declaratory judgment. Count I was for “express indemnification” against First Chicago and

          requested, in the event that Wilson should prevail in her lawsuit against Molda, that judgment

          be entered against First Chicago “for the full amount of any such judgment plus costs,

          expenses and attorneys fees incurred by MICHAEL MOLDA.” Count II was for “express

          and implied indemnification” against Metrolift and requested, in the event that Wilson should

          prevail in her lawsuit against Molda, that judgment be entered against Metrolift “for the full

          amount of any such judgment, plus costs, expenses and attorneys fees incurred by

          MICHAEL MOLDA.” 3

¶ 10         On February 26, 2010, the trial court granted summary judgment in favor of First

          Chicago, finding that Metrolift did not provide notice of the accident as required by the

          policy and, therefore, First Chicago did not have a duty to defend or indemnify Molda.

          Wilson and Molda appealed, and we reversed, finding that there were factual questions as to


             3
                 Molda voluntarily dismissed count II as to Metrolift on February 9, 2010.

                                                               5
       No. 1-14-0548


          the adequacy of the notice. First Chicago Insurance Co. v. Molda, 408 Ill. App. 3d 839, 852-

          53 (2011).

¶ 11         On October 16, 2012, Molda filed a motion for summary judgment, and on October 23,

          2012, Wilson also filed a motion for summary judgment. On February 8, 2013, the trial court

          denied all motions for summary judgment.

¶ 12         On January 13, 2014, the first day of trial, First Chicago filed an amended complaint for

          declaratory judgment. In addition to the late notice of loss and late notice of lawsuit counts

          that were included in the initial complaint, First Chicago’s amended complaint also included

          a third count, alleging that “Molda Is Not an Insured as Defined by the FCIC Policy of

          Insurance.” The amended complaint alleges that Molda was not operating a covered auto

          under the policy and was only an insured to the extent of Metrolift’s liability; since there

          could be no liability against Metrolift, Molda was not an insured under the policy.

¶ 13         The parties proceeded to a bench trial on January 13, 2014. Stephen Harrison testified

          that he worked at Metrolift until 2011, where he was treasurer but “was basically CFO” and

          had “some operational responsibilities.” Harrison testified that his daily responsibilities

          included “[a]ll administrative, banking, insurance, financial, accounting, and assist[ing] the

          president of the company, the owner with his day-to-day operations.” Along with Richard

          Dahl, the owner of Metrolift, Harrison was in charge of insurance matters for Metrolift.

          Harrison testified that Metrolift had a number of insurance policies, including general

          liability, auto, and workers’ compensation policies, through different insurance carriers.

¶ 14         Harrison testified that in procuring insurance for Metrolift, Metrolift often worked with

          an insurance broker, Mark Baskiewicz of Associated Specialty Insurance (Associated), who

          Harrison considered a “social friend[].” If there was an accident involving bodily injury that


                                                       6
       No. 1-14-0548


          occurred and it involved a policy Metrolift had procured through Associated, Harrison

          “would call Mark and discuss with him whatever [Harrison] knew about it”; Harrison

          testified that he “had no experience in automobile accidents” and would rely on Associated.

          Harrison would then complete an accident report and send Baskiewicz the accident report,

          police report, and any statements from the driver of the vehicle. After sending the

          information to Baskiewicz, “[d]epending on what I reviewed, if we thought a claim was

          going to evolve, I guess we would notify the insurance company. If not, we would just wait.”

¶ 15         With regard to Molda’s accident in 2005, Harrison recalled receiving notice of the

          accident “relatively quick[ly].” Harrison called Baskiewicz and discussed the accident with

          him, informing him of the details of the accident and that he believed Molda had his own

          insurance coverage since he was not driving a Metrolift vehicle. After speaking with

          Baskiewicz, “we decided jointly to wait to see whether or not a lawsuit was going to be filed

          against us, because it was happening during his lunch hour, and also because he had his own

          private insurance.”

¶ 16         Harrison testified that at the time he spoke with Baskiewicz, he “believe[d] we were

          following the requirements of the policy, because he was our agent or broker. It was his job

          to let me know what was going on.” He did not expect Baskiewicz to contact First Chicago

          as a result of their conversation.

¶ 17         Harrison testified that he was unaware at the time that First Chicago paid Associated

          bonus commissions based on claims and that, had he known, “[i]t surely would have seemed

          to affect [Baskiewicz’s] judgment, it wouldn’t have been quite as impartial where I would

          have been concerned.”




                                                      7
       No. 1-14-0548


¶ 18         One of the documents admitted into evidence at trial was a chain of emails between

          Harrison and Baskiewicz. The first email was a draft of a letter prepared by Harrison, which

          was sent to Bakiewicz. The letter was addressed to First Chicago’s claims department and

          provided, in relevant part:

                       “I, Stephen J. Harrison, corporate treasurer[,] notified Mark Baskiewicz of the

                 incident involving Nola Wilson and Michael Molda on or near the date of the incident

                 (August 17, 2005[)].

                       Notification was via phone conversation. This statement is verified and confirmed

                 by Mark Baskiewicz on the attached letter dated May 21, 2008.

                       This notification procedure is consistent with Metrolift’s course of dealing with

                 Associated Specialty Insurance, both before and since the Wilson/Molda accident. I

                 would notify Mark Baskiewicz of all accidents, incidents, claims, or losses covered

                 under the insurance coverage provided through his agency. As the insurance

                 company’s authorized representative, I would convey to him the proper information

                 as known to me at the time.

                       Metrolift, Inc. has never had any direct contact with [First Chicago] with

                 regarding [sic] applications for coverage, underwriting of coverage, issuance and

                 delivery of policies and notification of accidents, claims, suits or losses. Mark

                 Baskiewicz was the authorized representative of [First Chicago] for all these

                 purposes. Thus all of our communications with [First Chicago] went through him.”

¶ 19         The second email in the email chain was from Baskiewicz to Harrison, in response to the

          draft letter, and provided:




                                                       8
       No. 1-14-0548


                        “Everything looks good except you should leave off the part that you had no

                    direct dealings with [First Chicago] auto as they billed you direct as well as for any

                    endorsements and sent you the policies direct. There were even times when you guys

                    called them direct to make a payment. Everything else looks good !! When Kenny

                    gets in, I will give him a copy of the letter as well.”

¶ 20           John Gettemans testified at trial that he served as First Chicago’s president from May

           1989 to September 2013. He was also president of Insurance Concepts Enterprises, Inc., also

           known as the ICE Agency, from 1991 through April 2005. The ICE Agency was First

           Chicago’s “marketing arm,” and Associated was one of the ICE Agency’s subproducers. The

           ICE Agency contracted to pay Associated bonus commissions contingent on First Chicago’s

           profits; “[t]he more First Chicago made on its insurance business with Associated, the more

           it would pay Associated in commissions.” Associated would lose its right to earn bonus

           commissions if the profitability of its book of business with First Chicago fell below a certain

           level. Additionally, Associated had a limited right to issue binding insurance on behalf of

           First Chicago; eligibility for binding authority was conditioned on maintaining a certain level

           of profitability on the insurance for First Chicago, referred to as the “loss ratio.” Under the

           loss ratio, Associated could not keep its limited authority to bind First Chicago policies

           unless it maintained a loss ratio of less than 50%, nor would it receive bonus commissions

           unless the loss ratio was less than 50%. 4 First Chicago and the ICE Agency used an agent

           number to identify producers in order to calculate whether bonuses were earned;

           Associated’s agent number, which appeared on Metrolift’s insurance policy documents, was

           “001 ICE 015 Associate.”


               4
                Under the producer contingency agreement, the loss ratio was calculated by dividing the loss and loss
       adjustment expense incurred by the net earned premiums.

                                                               9
       No. 1-14-0548


¶ 21         Gettemans testified that First Chicago “encouraged people to report [claims] to us, but if

          they felt more comfortable reporting to their agent, we encourage them to do so so it would

          be reported and their agent could report it to our people.” On cross-examination, Gettemans

          admitted that “[i]f they do not report it directly,” First Chicago “expressly authorized

          Metrolift to give notice of loss and notice of lawsuit to its agent Associated” at the time of

          Molda’s accident in 2005. However, Gettemans testified that “it’s still the duty of the agent

          to report the claim to the company. The company is the only authorized representative.”

¶ 22         Molda testified that on August 17, 2005, at the time of the accident with Wilson, he was

          on his way to a construction site and was “performing [his] job duties for Metrolift.” At the

          time of the accident, he was driving a 2001 Ford Taurus owned by his mother, Margo

          Clemmons; Molda did not reside with his mother. Molda testified that he was not offered a

          company vehicle to drive and was expected to use his own vehicle as part of his job duties as

          a salesman. Molda had insurance on the vehicle through State Farm, which had a $20,000

          policy limit. Molda notified both State Farm and Metrolift after the accident. When Molda

          was served with Wilson’s suit on October 11, 2007, he forwarded the papers to State Farm,

          which retained an attorney to represent him. Molda never had any communications with First

          Chicago. On cross-examination, Molda testified that he first learned of the existence of First

          Chicago and Metrolift’s insurance coverage in 2008.

¶ 23         Mark Zintak testified at trial that he managed the special investigative unit and

          subrogation unit for First Chicago and had been employed by First Chicago since May 2005.

          Zintak testified that First Chicago first received notice of Molda’s accident on March 26,

          2008, when it received notice of Wilson’s lawsuit. First Chicago received notice of the

          lawsuit from Associated; Molda never submitted anything to First Chicago. Zintak testified


                                                     10
       No. 1-14-0548


          that insurance cards issued by First Chicago would have First Chicago’s name and contact

          information printed on the cards.

¶ 24         Zintak testified that it was important to receive prompt notice of an accident so that First

          Chicago would be able to conduct an “accurate investigation” of the claim, including

          speaking to all of the witnesses and parties involved and observing the “proximity of the

          damage,” which could involve an accident reconstruction; in Molda’s case, both vehicles

          were taken to a salvage yard, so observing the vehicles was not possible. Zintak further

          testified that “[m]ost important[ly],” Molda’s vehicle contained an electronic data recovery

          system that could have provided information such as the speed of the vehicle at the time of

          the accident, whether Molda was wearing a seatbelt, and whether the brakes were engaged,

          “which would give us some documentation as to the cause of the accident and what

          happened.” Zintak also testified that it was “very, very difficult” to examine the scene of the

          loss three years later and that “[i]n this case we wanted to talk to the owner of the vehicle to

          see if he had permission to drive the car, and if he was somehow using it in relation to

          business or on a personal matter.”

¶ 25         Zintak testified that the only investigation he could perform as a result of the late notice

          was obtaining part of a police report indicating that the vehicle appeared to be owned by a

          “Marco Clemmons” residing at the same address as Molda, as well as checking insurance

          databases to discover any information available there. On cross-examination, Zintak admitted

          that he had never attempted to contact either Molda or Wilson to take their statements

          regarding the accident, nor did he attempt to contact the witness and police officer listed in

          the police report. Zintak further admitted that he did not attempt to obtain a copy of the title




                                                      11
       No. 1-14-0548


          to the vehicle, which listed Margo Clemmons as the owner, but assumed that Marco

          Clemmons was the owner based on the police report.

¶ 26         On January 31, 2014, the trial court entered judgment in favor of defendants and against

          First Chicago and further “declare[d] that the applicable [First Chicago] policy of insurance

          entitles Molda to defense and indemnification relative to any and all claims of Wilson.” The

          court found that, while Molda’s vehicle was not a specifically described auto or a borrowed

          auto, it was a non-owned auto as defined by category 9 of the insurance policy. Additionally,

          the court found that “[t]he complaint filed by Wilson contained allegations which would

          trigger coverage of Molda, if said complaint was timely filed within the statute of

          limitations,” and, accordingly, found that Molda was an insured under the policy.

¶ 27         The court found that, with respect to notice of the loss, “the evidence produced, including

          [First Chicago’s] acquiescence under prior circumstances, the parties’ practice of

          communication, and the declaration page of the policy, is sufficient to establish Associated’s

          apparent authority” and further found that “the notice to Associated complied with the terms

          of the policy.” The court also found that “[t]he failure of Associated to forward the notice to

          [First Chicago] does not amount to concealment or collusion as [to] notice to [First

          Chicago],” noting that “[t]here is no evidence of fraud.” The court found that “[t]he evidence

          of Associated’s ‘bonus program’ is insufficient to establish that it would be against the

          agent’s interest to reveal the information to the principal,” and also noted that Harrison

          testified that the reason that notice was not forwarded “was because they were not sure

          Molda was working or was at lunch at the time of the accident and Molda had his own

          insurance”; the court further noted that “Harrison believed he was following the terms of the




                                                      12
       No. 1-14-0548


           policy and was relying on Associated.” Consequently, the court found that the notice of the

           loss given under the policy “was prompt and reasonable.”

¶ 28              With respect to notice of the lawsuit, the court found that “prompt notice of the

           occurrence was given. The insured was reasonably diligent in ascertaining whether coverage

           was available. Molda relied on Harrison who, in turn, relied on Baskiewicz. Finally, it cannot

           be said that [First Chicago] suffered any prejudice because the underlying case, Wilson v.

           Molda[,] has not advanced and [First Chicago] has not made any serious attempt to

           investigate this matter.” The court also found that “while Harrison had some level of

           sophistication, he testified that he was ‘not strong’ in auto coverage, was more

           knowledgeable in general liability and relied on Baskiewicz. Molda was not sophisticated.”

¶ 29              This appeal follows.

¶ 30                                                        ANALYSIS

¶ 31              On appeal, First Chicago argues that (1) Molda was not an insured under the insurance

           policy; (2) Associated was not the agent of First Chicago for purposes of providing notice;

           and (3) Molda did not provide timely notice of the loss. 5

¶ 32                                           I. Whether Molda Was an Insured

¶ 33              First Chicago first argues that the trial court erred in finding that Molda was an insured

           under the First Chicago insurance policy because (1) Molda’s vehicle was not a covered auto

           under the policy and (2) Molda was not an insured as defined by the policy. The construction

           of a provision of an insurance policy is a question of law that we review de novo. Addison

           Insurance Co. v. Fay, 232 Ill. 2d 446, 451 (2009). De novo consideration means we perform

           the same analysis that a trial judge would perform. Erie Insurance Exchange v. Compeve

                  5
                      We note that First Chicago does not argue on appeal that Molda failed to provide timely notice of the
       lawsuit.

                                                                    13
       No. 1-14-0548


          Corp., 2015 IL App (1st) 142508, ¶ 14. “A court’s primary objective in construing an

          insurance contract is to ascertain and give effect to the intention of the parties as expressed in

          the agreement.” Addison, 232 Ill. 2d at 455. “An insurance contract will be liberally

          construed in favor of the insured.” Addison, 232 Ill. 2d at 455.

¶ 34          As an initial matter, we must address defendants’ argument that this issue has already

          been decided by this court and, therefore, the law of the case doctrine bars relitigation of the

          issue. “[T]he law of the case doctrine bars relitigation of an issue previously decided in the

          same case.” Krautsack v. Anderson, 223 Ill. 2d 541, 552 (2006). However, the issue of

          whether Molda was an insured under the First Chicago policy was not decided by this court

          in the earlier appeal. In our previous consideration of the instant case, when we were

          reviewing the trial court’s grant of summary judgment in First Chicago’s favor, our recitation

          of the facts included the statement that “[u]nbeknownst to Molda, as a Metrolift employee, he

          was also covered under Metrolift’s insurance policy with First Chicago.” First Chicago, 408

          Ill. App. 3d at 840. We also noted, in a footnote, that “Molda’s automobile was owned by

          Margo Clements, his mother, but the ownership of the vehicle does not affect Molda’s

          coverage under the First Chicago policy.” First Chicago, 408 Ill. App. 3d at 840 n.3. These

          statements do not reflect a decision on the issue of whether Molda was an insured under the

          policy. The case at that point was focused solely on the issue of notice; in fact, First Chicago

          did not amend its complaint to include an allegation that Molda was not an insured under the

          policy until January 13, 2014, the first day of trial. We cannot find that two passing

          references concerning something that would not become an issue in the case until nearly

          three years after our decision in any way reflects that the issue was “previously decided” by

          this court.


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       No. 1-14-0548


¶ 35         Turning to the merits of First Chicago’s argument, under the First Chicago policy, First

          Chicago agreed to “pay all sums an ‘insured’ legally must pay as damages because of ‘bodily

          injury’ or ‘property damage’ to which this insurance applies, caused by an ‘accident’ and

          resulting from the ownership, maintenance or use of a covered ‘auto,’ ” and also owed the

          “right and duty to defend any ‘insured’ against a ‘suit’ asking for such damages.” Thus, to be

          eligible for coverage, Molda must have been considered an insured and must have been using

          a covered auto at the time of his accident.

¶ 36                           A. Whether the Vehicle Was a Covered Auto

¶ 37         With respect to the question of whether Molda’s vehicle was a covered auto, Metrolift

          purchased insurance coverage for three categories of autos—categories 7, 8, and 9. The

          parties agree that categories 7 and 8 do not apply, but disagree as to whether Molda’s vehicle

          was included in category 9. Category 9 was described as: “NONOWNED AUTOS ONLY.

          Only those autos you do not own, lease, hire or borrow which are used in connection with

          your business. This includes autos owned by your employees or members of their house-

          holds but only while used in your business or your personal affairs.”

¶ 38         Molda testified at trial that at the time of the accident, he was driving a 2001 Ford Taurus

          owned by his mother, Margo Clemmons, and further testified that he did not reside with

          Clemmons. First Chicago argues that Molda’s vehicle would have been covered only if the

          vehicle was owned by Molda or someone in his household and also argues that there was no

          evidence that the vehicle was being used in Metrolift’s business. We do not find this

          argument persuasive.

¶ 39         First Chicago argues that in order to give effect to all provisions of the policy, category 9

          must be read to limit nonowned autos to only those vehicles owned by an employee or


                                                        15
       No. 1-14-0548


           member of the household and that “[i]f Non Owned auto was meant to be so broad to include

           any automobile not owned by METROLIFT (as defendants suggest), then other provisions of

           the policy would be improperly rendered superfluous.” (Emphasis in original.) However,

           First Chicago’s interpretation of the definition of nonowned autos is overly restrictive. Under

           the plain language of the definition of nonowned auto, a vehicle is covered if (1) it is not

           owned, leased, hired or borrowed by Metrolift and (2) it is used in connection with

           Metrolift’s business. After that basic definition, the policy makes clear that vehicles not

           owned, leased, hired or borrowed by Metrolift but owned by its employees would be entitled

           to coverage if used in connection with Metrolift’s business. The limitation of the definition to

           those autos used in connection with Metrolift’s business prevents the category from being so

           broad as to render other provisions superfluous, as First Chicago suggests. 6

¶ 40            We do not find persuasive First Chicago’s attempt to invoke “the ‘well-known maxim of

           construction, inclusio unius est exclusio alterius, or the inclusion of one is the exclusion of

           the other.’ ” In re Marriage of Hendry, 409 Ill. App. 3d 1012, 1018 (2011) (quoting

           Schanowitz v. State Farm Mutual Automobile Insurance Co., 299 Ill. App. 3d 843, 848

           (1998)). Despite First Chicago’s contention that the last sentence of the definition “clearly

           limits” the category to only those vehicles owned by the employee or member of his or her

           household, the last sentence does not contain any language of limitation, other than the

           requirement that the vehicle be used in connection with Metrolift’s business, which is a

           limitation applicable to the category as a whole. Instead, the last sentence makes explicit the

           inclusion of a category of vehicles that otherwise could have been questionable.



                6
                  We note that this limitation distinguishes it from category 1, which provides coverage for “any ‘auto’,”
       which appears to be the provision that First Chicago argues would be rendered superfluous. Category 1 does not
       require that the auto be used in connection with Metrolift’s business in order to be covered.

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       No. 1-14-0548


¶ 41         We also note that, although not cited by either party, we have reached this same

          conclusion before in Pekin Insurance Co. v. Benson, 306 Ill. App. 3d 367 (1999), under

          remarkably similar circumstances. In that case, the defendant was involved in an accident

          while driving a vehicle owned by her mother, who did not reside with the defendant. Pekin,

          306 Ill. App. 3d at 371. The plaintiff insurance company denied coverage, claiming that the

          defendant’s vehicle was not a “ ‘nonowned auto,’ ” which was defined as “ ‘[a]ny “auto” you

          do not own, lease, hire, rent, or borrow used in connection with your garage business

          described in the Declarations. This includes “autos” owned by your employees or partners or

          members of their households while used in your garage business.’ ” Pekin, 306 Ill. App. 3d at

          371. On appeal, the insurer contended that “the second sentence of the definition limits its

          coverage to autos owned by the insured’s employees, partners, or members of their

          households used in connection with the insured’s business.” Pekin, 306 Ill. App. 3d at 372.

¶ 42         We rejected the insurer’s arguments, noting that “a commonsense reading of the language

          ‘any auto’ in the first sentence of the definition combined with the insurance contract’s

          purpose of extending coverage to anyone occupying a ‘covered auto’ support[ed] the trial

          court’s interpretation” of “ ‘nonowned auto’ ” as including any auto the insured did not own,

          lease, hire, rent, or borrow. Pekin, 306 Ill. App. 3d at 372. Furthermore, we agreed with the

          trial court that “the second sentence of the ‘nonowned auto’ definition constitute[d] an

          amplification or illustration of the general definition.” Pekin, 306 Ill. App. 3d at 372. See also

          Pekin, 306 Ill. App. 3d at 373 (stating that “the second sentence does not contain any

          meaningless phrases but provides guidance as to what may constitute a ‘nonowned auto’ ”).

          We did not find persuasive the insurer’s arguments that the word “ ‘includes’ ” was intended

          to be a limitation of coverage, finding that, at most, there were competing interpretations of


                                                       17
       No. 1-14-0548


          the word, and pointing out that “the second sentence of the definition does not state, ‘This

          only includes employees or partners, or members of their household.’ ” (Emphasis in

          original.) Pekin, 306 Ill. App. 3d at 373. Accordingly, we found that the trial court properly

          found that the defendant’s vehicle was a “ ‘nonowned auto’ ” under the insurance policy.

          Pekin, 306 Ill. App. 3d at 374.

¶ 43         The language interpreted by the court in Pekin is almost identical to that at issue in the

          present case with respect to the issue of whether the vehicle was a covered auto under the

          policy. There, a “ ‘nonowned auto’ ” was defined as “ ‘[a]ny “auto” you do not own, lease,

          hire, rent, or borrow used in connection with your garage business described in the

          Declarations. This includes “autos” owned by your employees or partners or members of

          their households while used in your garage business.’ ” Pekin, 306 Ill. App. 3d at 371.

          Similarly, here, category 9 was described as: “NONOWNED AUTOS ONLY. Only those

          autos you do not own, lease, hire or borrow which are used in connection with your business.

          This includes autos owned by your employees or members of their house-holds but only

          while used in your business or your personal affairs.” The Pekin court’s reading of that

          language as including the employee’s mother’s vehicle provides support for our reaching of a

          similar conclusion in the instant case.

¶ 44         In the case at bar, Molda’s vehicle was not owned, leased, hired or borrowed by

          Metrolift. Accordingly, if it was used in connection with Metrolift’s business, then it would

          be a covered auto under category 9.

¶ 45         First Chicago argues that there was no evidence that Molda’s vehicle was used in

          connection with Metrolift’s business. However, Molda testified that on August 17, 2005, at

          the time of the accident with Wilson, he was on his way to a construction site and was


                                                     18
       No. 1-14-0548


          “performing [his] job duties for Metrolift.” Molda further testified that in his capacity as a

          sales representative, he was never given a company vehicle to drive and it was his

          understanding that as part of his job duties, he needed to drive his own vehicle and Metrolift

          was aware that he was driving his own vehicle. First Chicago argues that this evidence “is

          nothing but a conclusion and proves nothing, and thus has no evidentiary value.” However, it

          is for the trial court to determine the weight a witness’ testimony should receive. Bazydlo v.

          Volant, 164 Ill. 2d 207, 214-15 (1995). Additionally, the vehicle was only required to be used

          “in connection with” Metrolift’s business, a term that has been construed as being broad as

          well as vague, meaning that it must be construed strictly against the insurer. Hartford Fire

          Insurance Co. v. Whitehall Convalescent & Nursing Home, Inc., 321 Ill. App. 3d 879, 889

          (2001). In the case at bar, through Molda’s testimony, defendants provided evidence that

          Molda was operating the vehicle in connection with First Chicago’s business, and

          accordingly, Molda’s vehicle was properly considered to be a “nonowned auto” under the

          First Chicago policy.

¶ 46         We find unpersuasive First Chicago’s reliance on Kinney v. Continental Assurance Co.,

          42 Ill. App. 3d 263 (1976), as support for its argument that the evidence presented at trial

          through Molda’s testimony is insufficient to demonstrate that he was operating the vehicle in

          connection with Metrolift’s business. Kinney involves quite different issues than those

          present in the case at bar, as well as different factual circumstances. In that case, the court

          was considering the question of whether the defendant was acting within the scope of his

          employment at the time of the accident at issue so as to give rise to vicarious liability. The

          court noted that “the general rule of law is that accidents which occur while an employee is

          going to or from his employment do not arise out of or in the course of his employment”


                                                      19
       No. 1-14-0548


          (Kinney, 42 Ill. App. 3d at 266 (citing Burmeister v. Industrial Comm’n, 52 Ill. 2d 84, 86

          (1972)), and found that the defendant “was on his own time, on his own errand, in his own

          automobile” (Kinney, 42 Ill. App. 3d at 266). Consequently, the Kinney court found that the

          trial court correctly determined that the defendant’s employer was not vicariously liable for

          the defendant, since the defendant was not acting within the scope of his employment at the

          time of the accident. Kinney, 42 Ill. App. 3d at 266-67.

¶ 47         In the case at bar, the trial court was not asked to determine whether Metrolift would be

          vicariously liable for Molda’s actions. Instead, the insurance policy merely required Molda to

          be operating the vehicle “in connection with” Metrolift’s business. As we noted, this is a

          term that has been construed as being broad as well as vague, meaning that it must be

          construed strictly against the insurer. Hartford, 321 Ill. App. 3d at 889. Furthermore, unlike

          the defendant in Kinney, who “was on his own time, on his own errand, in his own

          automobile” (Kinney, 42 Ill. App. 3d at 266), Molda testified that he was traveling to a job

          site as part of his job duties as a salesman for Metrolift, duties that required him to drive his

          own vehicle. Accordingly, we cannot find that it was against the manifest weight of the

          evidence for the trial court to find that the vehicle Molda was operating was a “nonowned

          auto” under the First Chicago policy.

¶ 48                   B. Whether Molda Was an “Insured” Under the Policy Language

¶ 49         First Chicago also argues that Molda was not an insured as defined by the First Chicago

          policy. Metrolift was the named insured under the policy and the policy further provided that

          “[t]he following are ‘insureds’ ” under the policy:

                       “a. You for any covered ‘auto’.




                                                         20
       No. 1-14-0548


                       b. Anyone else while using with your permission a covered ‘auto’ you own, hire

                 or borrow except:

                          (1) The owner or anyone else from whom you borrow a covered ‘auto’. This

                       exception does not apply if the covered ‘auto’ is a ‘trailer’ connected to a covered

                       ‘auto’ you own.

                          (2) Your employee if the covered ‘auto’ is owned by that employee or a

                       member of his or her household.

                          (3) Someone using a covered ‘auto’ while he or she is working in a business

                       of selling, servicing, repairing, parking or storing ‘autos’ unless that business is

                       yours.

                          (4) Anyone other than your employees, partners, a lessee or borrower or any

                       of their employees, while moving property to or from a covered ‘auto’.

                          (5) A partner of yours for a covered ‘auto’ owned by him or her or a member

                       of his or her household.

                       c. Anyone liable for the conduct of an ‘insured’ described above but only to the

                 extent of that liability.”

          Molda does not qualify as an insured under either paragraph (a) or (b), since he was not the

          named insured and the vehicle he was driving was not owned, hired or borrowed by

          Metrolift. Accordingly, the only way that Molda would be covered by the policy would be if

          paragraph (c) applied.

¶ 50         We agree with the trial court that Molda qualifies as an insured under paragraph (c).

          Under that paragraph, Molda would be considered an insured if he was liable for the conduct

          of Metrolift, but only to the extent of that liability. First Chicago argues that since all of the

                                                        21
       No. 1-14-0548


           claims against Metrolift were dismissed, Metrolift has no liability for the accident and,

           consequently, Molda cannot be considered an insured since he would be an insured “only to

           the extent of [Metrolift’s] liability.” However, First Chicago’s argument overlooks the fact

           that “ ‘[q]uestions of applicable coverage can be determined only as of the time of the

           accident creating potential liability.’ ” Gaudina v. State Farm Mutual Automobile Insurance

           Co., 2014 IL App (1st) 131264, ¶ 26 (quoting Coley v. State Farm Mutual Automobile

           Insurance Co., 178 Ill. App. 3d 1077, 1081 (1989)). See also Hawkeye Security Insurance

           Co. v. Sanchez, 122 Ill. App. 3d 183, 186 (1984). At the time of the accident, Metrolift had

           potential liability under the doctrine of respondeat superior, and, in fact, was included as a

           defendant in Wilson’s case on that basis. 7 If Wilson obtained a judgment against Metrolift

           under the theory of respondeat superior, Metrolift would be entitled to indemnification from

           Molda under the common law theory of quasi-contractual implied indemnity. Gibbs v. Top

           Gun Delivery & Moving Services, Inc., 399 Ill. App. 3d 765, 772 (2010); American National

           Bank & Trust Co. v. Columbus-Cuneo-Cabrini Medical Center, 154 Ill. 2d 347, 353-54

           (1992). Consequently, at the time of the accident, Molda was “liable for the conduct of an

           ‘insured’ described above but only to the extent of that liability,” and, therefore, qualified as

           an insured under the First Chicago policy.

¶ 51                            II. Whether Associated Was First Chicago’s Agent

¶ 52           First Chicago next argues that the trial court erred in finding that Associated was First

           Chicago’s agent for purposes of accepting notice. “Generally, the question of whether an

           agency relationship exists and the scope of the purported agent’s authority are questions of

           fact.” Kaporovskiy v. Grecian Delight Foods, Inc., 338 Ill. App. 3d 206, 210 (2003). “A

               7
                 The count against Metrolift was dismissed on statute of limitations grounds, a decision that was affirmed
       on appeal. Wilson v. Molda, 396 Ill. App. 3d 100 (2009).

                                                               22
       No. 1-14-0548


          reviewing court should not overturn a trial court’s findings merely because it does not agree

          with the lower court or because it might have reached a different conclusion had it been the

          fact finder.” Bazydlo, 164 Ill. 2d at 214. “The trial judge, as the trier of fact, is in a position

          superior to a reviewing court to observe witnesses while testifying, to judge their credibility,

          and to determine the weight their testimony should receive.” Bazydlo, 164 Ill. 2d at 214-15.

          Consequently, we will not reverse the trial court’s judgment unless it is against the manifest

          weight of the evidence. Farmers Automobile Insurance Ass’n v. Gitelson, 344 Ill. App. 3d

          888, 891-92 (2003). “A judgment is against the manifest weight of the evidence only when

          an opposite conclusion is apparent or when findings appear to be unreasonable, arbitrary, or

          not based on evidence.” Bazydlo, 164 Ill. 2d at 215.

¶ 53         In the case at bar, the trial court found that “the evidence produced, including [First

          Chicago’s] acquiescence under prior circumstances, the parties’ practice of communication,

          and the declaration page of the policy, is sufficient to establish Associated’s apparent

          authority.” We cannot find this conclusion to be against the manifest weight of the evidence.

¶ 54         As we noted in our prior decision, defendants’ argument that proper notice was given

          relies on the theory that notice to an agent is imputed to its principal. In the insurance

          context, an insurance broker is generally considered to be the agent of the insured and not the

          insurance company unless the agent is a general agent of the insurance company. State

          Security Insurance Co. v. Burgos, 145 Ill. 2d 423, 431 (1991); Founders Insurance Co. v.

          White, 367 Ill. App. 3d 883, 888 (2006); Young v. Allstate Insurance Co., 351 Ill. App. 3d

          151, 162 (2004); Mitchell Buick & Oldsmobile Sales, Inc. v. National Dealer Services, Inc.,

          138 Ill. App. 3d 574, 582 (1985). However, there are situations in which an insurance broker

          can act as the agent of the insurance company or even as the agent of both the insured and the


                                                        23
       No. 1-14-0548


          insurance company. Burgos, 145 Ill. 2d at 431; Empire Fire & Marine Insurance Co. v. Faith

          Truck Lines, Inc., 178 Ill. App. 3d 356, 359 (1988). Additionally, even if the broker does not

          have the actual authority to act as the insurer’s agent for notice, it may have apparent

          authority to do so. Burgos, 145 Ill. 2d at 431. See also Long v. Great Central Insurance Co.,

          190 Ill. App. 3d 159, 165-66 (1989); Empire, 178 Ill. App. 3d at 359-60; Mitchell Buick, 138

          Ill. App. 3d at 583; American Home Assurance Co. v. City of Granite City, 59 Ill. App. 3d

          656, 663 (1978); State Security Insurance Co. v. Goodman, 6 Ill. App. 3d 1008, 1011-12

          (1972); Boston Store of Chicago v. Hartford Accident & Indemnity Co., 227 Ill. App. 192,

          203-04 (1922); 13 Couch on Insurance 3d § 187:73 (West 1999); 11 Eric Mills Holmes,

          Holmes’ Appleman on Insurance 2d § 68.8 (Lexis 1996).

¶ 55         Apparent authority is that authority which a reasonably prudent person would naturally

          suppose the agent to possess, given the words or conduct of the principal. Burgos, 145 Ill. 2d

          at 431-32. “It is a well-established precept of agency law that a principal will be bound by the

          authority he appears to give to another, as well as that authority which he actually gives.”

          (Emphasis in original.) Burgos, 145 Ill. 2d at 431 (citing Lynch v. Board of Education of

          Collinsville Community Unit District No. 10, 82 Ill. 2d 415, 426 (1980)). Once the principal

          has created the appearance of authority, he is estopped from denying it to the detriment of a

          third party. Burgos, 145 Ill. 2d at 432. To establish apparent agency, the party alleging the

          existence of the agency must prove that (1) the principal or its agent acted in a manner that

          would lead a reasonable person to believe that the individual allegedly at fault was an

          employee or agent of the principal; (2) the principal had knowledge of and acquiesced in the

          acts of the agent; and (3) the injured party acted in reliance upon the conduct of the principal




                                                      24
       No. 1-14-0548


          or its agent, consistent with ordinary care and prudence. Wilson v. Edward Hospital, 2012 IL

          112898, ¶ 18.

¶ 56         The apparent authority of an insurance broker to act as an agent of the insurance

          company for notice can be established through the course of dealings between the broker and

          the insurance company. Burgos, 145 Ill. 2d at 432. “Where an insurer’s manner of dealing

          with the broker in regard to the insured would lead the insured to believe that the broker had

          the authority to perform the acts in question, the insurer is estopped to deny the broker’s

          authority to perform those acts.” Burgos, 145 Ill. 2d at 432. Moreover, acquiescence in the

          insurance broker’s conduct by the insurance company under prior circumstances is sufficient

          to establish the broker’s apparent authority. Burgos, 145 Ill. 2d at 432.

¶ 57         In the case at bar, there was evidence presented at trial supporting the trial court’s

          conclusion that Associated was First Chicago’s agent for purposes of accepting notice.

          Examining the policy itself, as we noted in our prior case, the policy required that, “[i]n the

          event of ‘accident’, claim, ‘suit’ or ‘loss’, you must give us or our authorized representative

          prompt notice of the ‘accident’ or ‘loss’.” The First Chicago policy included Associated’s

          name, address, and telephone number on its declarations page as the producer. It did not

          provide any other contact information, nor was any individual or business other than

          Metrolift named anywhere within the policy. If a claim was to be made, there was no

          reference to a phone number or person in his representative capacity to contact other than

          “our authorized representative.” Additionally, in payment schedules admitted into evidence,

          Associated’s information is listed under the underlined heading “Agent” and an “Agent

          Number” is provided under Associated’s information.




                                                       25
       No. 1-14-0548


¶ 58         Gettemans, president of First Chicago at the time of Molda’s accident, testified that First

          Chicago “encouraged people to report [claims] to us, but if they felt more comfortable

          reporting to their agent, we encourage them to do so so it would be reported and their agent

          could report it to our people.” On cross-examination, Gettemans admitted that “[i]f they do

          not report it directly,” First Chicago “expressly authorized Metrolift to give notice of loss and

          notice of lawsuit to its agent Associated” at the time of Molda’s accident in 2005. However,

          Gettemans testified that “it’s still the duty of the agent to report the claim to the company.

          The company is the only authorized representative.”

¶ 59         Harrison, who was responsible for Metrolift’s insurance, testified that if there was an

          accident involving bodily injury that occurred and it implicated a policy Metrolift had

          procured through Associated, Harrison “would call Mark [Baskiewicz] and discuss with him

          whatever [Harrison] knew about it”; Harrison testified that he “had no experience in

          automobile accidents” and would rely on Associated. Harrison would then complete an

          accident report and send Baskiewicz the accident report, police report, and any statements

          from the driver of the vehicle. After sending the information to Baskiewicz, “[d]epending on

          what I reviewed, if we thought a claim was going to evolve, I guess we would notify the

          insurance company. If not, we would just wait.” With regard to Molda’s accident in 2005,

          Harrison recalled receiving notice of the accident “relatively quick[ly].” Harrison called

          Baskiewicz and discussed the accident with him, informing him of the details of the accident

          and that he believed Molda had his own insurance coverage since he was not driving a

          Metrolift vehicle. After speaking with Baskiewicz, “we decided jointly to wait to see whether

          or not a lawsuit was going to be filed against us, because it was happening during his lunch

          hour, and also because he had his own private insurance.” Harrison testified that at the time


                                                       26
       No. 1-14-0548


          he spoke with Baskiewicz, he “believe[d] we were following the requirements of the policy,

          because he was our agent or broker. It was his job to let me know what was going on.”

¶ 60         The chain of emails between Harrison and Baskiewicz that was admitted at trial also

          supported Harrison’s testimony that he communicated solely with Baskiewicz concerning

          claims. The first email was a draft of a letter prepared by Harrison, which was sent to

          Bakiewicz. The letter was addressed to First Chicago’s claims department and provided, in

          relevant part:

                       “I, Stephen J. Harrison, corporate treasurer[,] notified Mark Baskiewicz of the

                 incident involving Nola Wilson and Michael Molda on or near the date of the incident

                 (August 17, 2005[)].

                       Notification was via phone conversation. This statement is verified and confirmed

                 by Mark Baskiewicz on the attached letter dated May 21, 2008.

                       This notification procedure is consistent with Metrolift’s course of dealing with

                 Associated Specialty Insurance, both before and since the Wilson/Molda accident. I

                 would notify Mark Baskiewicz of all accidents, incidents, claims, or losses covered

                 under the insurance coverage provided through his agency. As the insurance

                 company’s authorized representative, I would convey to him the proper information

                 as known to me at the time.

                       Metrolift, Inc. has never had any direct contact with [First Chicago] with

                 regarding [sic] applications for coverage, underwriting of coverage, issuance and

                 delivery of policies and notification of accidents, claims, suits or losses. Mark

                 Baskiewicz was the authorized representative of [First Chicago] for all these

                 purposes. Thus all of our communications with [First Chicago] went through him.”


                                                      27
       No. 1-14-0548


          Upon receiving the draft letter, Baskiewicz emailed Harrison with his approval.

¶ 61         In summary, the evidence at trial demonstrated that (1) First Chicago admittedly

          encouraged policyholders to report claims to their insurance agent if they felt more

          comfortable doing so; (2) First Chicago’s policy documents and payment schedules either

          provided only Associated’s contact information or expressly referred to Associated as

          “Agent”; and (3) Metrolift’s course of dealings with Associated and First Chicago involved

          contacting Associated, not First Chicago, whenever there was a potential insurance claim.

          We cannot find that it was against the manifest weight of the evidence for the trial court to

          conclude that this evidence gave rise to apparent agency for the purpose of accepting notice.

¶ 62         We find First Chicago’s arguments to the contrary to be unpersuasive. First Chicago

          argues that there was no reliance on Molda’s or Wilson’s behalf, which is necessary for a

          finding of apparent agency. However, as will be further discussed below, it is Metrolift that

          was responsible for providing notice to First Chicago, and Harrison testified that Metrolift

          relied on Associated to ensure compliance with the First Chicago policy. First Chicago

          further argues that there must be evidence that First Chicago “ ‘had knowledge of and

          acquiesced in the acts of the agent (Associated),’ ” and identifies the “ ‘act’ ” at issue as

          Associated’s failure to inform First Chicago of the accident. However, the “acts of the agent”

          for our purposes are the acts of purportedly accepting notice on behalf of First Chicago. As

          explained above, there was evidence presented that First Chicago was aware that Associated

          was accepting notice on its behalf and in fact encouraged that behavior for policyholders that

          did not wish to notify First Chicago directly. Finally, First Chicago points to statements of

          Harrison indicating that Metrolift considered Associated to be Metrolift’s agent, not First

          Chicago’s. However, as noted, there are situations in which an insurance broker can act as


                                                      28
       No. 1-14-0548


          the agent of the insurance company or even as the agent of both the insured and the insurance

          company. Burgos, 145 Ill. 2d at 431; Empire Fire & Marine Insurance Co., 178 Ill. App. 3d

          at 359. Thus, references to Associated as Metrolift’s agent do not preclude the trial court’s

          finding that it was also acting as First Chicago’s apparent agent.

¶ 63                                  III. Whether Notice Was Timely

¶ 64         Finally, First Chicago argues that the trial court erred in finding that the notice of the

          accident was timely and also argues that defendants breached the notice of loss provision by

          conspiring to withhold information from First Chicago. We note that First Chicago does not

          argue on appeal that notice of the lawsuit was untimely, but solely focuses on notice of the

          accident itself. Generally, the timeliness of notice given pursuant to an insurance policy is a

          question of fact for the trier of fact. University of Illinois v. Continental Casualty Co., 234 Ill.

          App. 3d 340, 363 (1992). “Where, as here, the trial court heard witness testimony and made a

          factual determination, its decision will not be reversed unless it is against the manifest weight

          of the evidence.” Illinois Founders Insurance Co. v. Barnett, 304 Ill. App. 3d 602, 607

          (1999). As noted, “[a] judgment is against the manifest weight of the evidence only when an

          opposite conclusion is apparent or when findings appear to be unreasonable, arbitrary, or not

          based on evidence.” Bazydlo, 164 Ill. 2d at 215.

¶ 65         A notice provision in an insurance contract is a “valid prerequisite[]” to coverage under

          the policy. Country Mutual Insurance Co. v. Livorsi Marine, Inc., 222 Ill. 2d 303, 311

          (2006); Berglind v. Paintball Business Ass’n, 402 Ill. App. 3d 76, 85 (2010) (“notice

          provisions are not merely technical requirements but, rather, conditions precedent to the

          triggering of the insurer’s contractual duties”). “Provisions in policies stating when the

          insurer must be notified of a covered occurrence have generally been interpreted to require


                                                        29
       No. 1-14-0548


          notification of the company within a reasonable time, considering all the facts and

          circumstances of the particular case.” American Family Mutual Insurance Co. v. Blackburn,

          208 Ill. App. 3d 281, 288 (1991); Barrington Consolidated High School v. American

          Insurance Co., 58 Ill. 2d 278, 281 (1974). “Whether notice has been given within a

          reasonable time depends on the facts and circumstances of each case.” Livorsi Marine, 222

          Ill. 2d at 311-12.

¶ 66          In the case at bar, First Chicago argues that it did not receive notice from Metrolift until

          March 2008, approximately 31 months after the accident, which it claims violates the notice

          provision of the policy as a matter of law. We rejected this exact argument in our earlier

          decision, and First Chicago has provided no reasons why we should depart from our earlier

          holding, even citing the same cases that we found unpersuasive in their previous case. First

          Chicago, 408 Ill. App. 3d at 851-52.

¶ 67          Moreover, as noted, the reasonableness of notice is a fact-specific inquiry. Livorsi

          Marine, 222 Ill. 2d at 311-12. “Factors the courts may consider in determining reasonable

          notice include: (1) the specific language of the policy’s notice provisions; (2) the degree of

          the insured’s sophistication in the world of commerce and insurance; (3) the insured’s

          awareness that an occurrence as defined under the terms of the policy has taken place; (4) the

          insured’s diligence and reasonable care in ascertaining whether policy coverage is available

          once the event has occurred; and (5) any prejudice to the insurance company.” Berglind v.

          Paintball Business Ass’n, 402 Ill. App. 3d 76, 86 (2010) (citing Livorsi Marine, 222 Ill. 2d at

          313).

¶ 68          First Chicago argues that defendants cannot argue that Metrolift was an unsophisticated

          insured because Metrolift knew it was required to provide notice to First Chicago and chose


                                                      30
       No. 1-14-0548


          not to do so. However, Harrison testified that he had no experience in the area of automobile

          insurance and relied on Associated to ensure Metrolift was complying with the First Chicago

          policy. First Chicago also argues that it was not required to show prejudice in a late notice of

          loss defense, but that it nevertheless demonstrated that it had been prejudiced by the delay by

          the inability to conduct the investigation it otherwise would have. First Chicago is correct

          that “once it is determined that the insurer did not receive reasonable notice of an occurrence

          or a lawsuit, the policyholder may not recover under the policy, regardless of whether the

          lack of reasonable notice prejudiced the insurer.” (Emphasis added.) Livorsi Marine, 222 Ill.

          2d at 317. However, while our supreme court has expressly rejected the notion that prejudice

          is a dispositive requirement in determining whether reasonable notice was provided (see

          Livorsi Marine, 222 Ill. 2d at 316-17 (“even if there is no prejudice to the insurer, a

          policyholder still must give reasonable notice according to the terms of the insurance

          policy”)), it has instructed that in making the determination of whether a policyholder’s

          notice is reasonable, “the presence or absence of prejudice to the insurer is one factor to

          consider.” Livorsi Marine, 222 Ill. 2d at 317. Thus, First Chicago’s contention that it was not

          required to show prejudice is incorrect in this situation, where the reasonableness of the

          notice is to be determined. First Chicago’s reliance on the appellate decision in Livorsi

          Marine is inapplicable, because there, the parties agreed that the notice provided by the

          insureds was unreasonable. Country Mutual Insurance Co. v. Livorsi Marine, Inc., 358 Ill.

          App. 3d 880, 884 (2004).

¶ 69         In the case at bar, the trial court found that “it cannot be said that [First Chicago] suffered

          any prejudice because the underlying case, Wilson v. Molda[,] has not advanced and [First

          Chicago] has not made any serious attempt to investigate this matter.” First Chicago argues


                                                       31
       No. 1-14-0548


          that the “undisputed evidence” showed that “[b]ecause of the late notice, [First Chicago] was

          not able to inspect the vehicle, talk to witnesses when the facts were fresh, or really conduct

          any meaningful investigation at all.” However, Zintak testified that he had not obtained the

          entire police report, did not attempt to obtain a copy of the vehicle’s title, did not interview

          either Wilson or Molda, and did not attempt to interview either the witness or the police

          officer listed in the police report. In addition, there is no showing whether Zintak contacted

          State Farm to learn what their investigation discovered. We agree with the trial court that this

          demonstrates that First Chicago “has not made any serious attempt to investigate this matter,”

          and does not show that First Chicago was prejudiced. Thus, the trial court’s finding that

          notice was reasonable was not against the manifest weight of the evidence.

¶ 70         Furthermore, we have concluded above that the trial court properly determined that

          Associated was First Chicago’s apparent agent for purposes of accepting notice of the loss.

          Associated was notified of the loss almost immediately, and First Chicago does not argue

          that the notice provided to Associated was unreasonable. Accordingly, the trial court’s

          conclusion that notice was timely was not against the manifest weight of the evidence.

¶ 71         First Chicago argues that the notice to Associated cannot be imputed to First Chicago

          because both Metrolift and Associated agreed not to provide the notice to First Chicago.

          Again, this is an argument that we considered and rejected in our earlier decision, and First

          Chicago does not provide any reason for us to depart from our earlier holding. First Chicago,

          408 Ill. App. 3d at 849-50. There, we noted that the cases First Chicago relied on to support

          its argument that notice to an agent is not imputed to a principal when the facts support the

          inference that the agent will conceal the information from the principal were all cases in

          which the agent was concealing information due to fraud or because it would be against the


                                                      32
       No. 1-14-0548


          agent’s interest to reveal the information to the principal. First Chicago, 408 Ill. App. 3d at

          850 (citing Neagle v. McMullen, 334 Ill. 168, 181 (1929), Merchants’ National Bank of

          Peoria v. Nichols & Shepard Co., 223 Ill. 41, 53 (1906), Tesluk v. Metropolitan Life

          Insurance Co., 130 Ill. App. 2d 290, 294-95 (1970), and Woodlawn Farm Co. v. Farmers &

          Breeders Livestock Insurance Co., 227 Ill. App. 577, 583-84 (1923)). We further noted that

          the facts present in those cases cited indicated that the concealment occurred at the time of

          the application for the insurance policy. First Chicago, 408 Ill. App. 3d at 850 (citing Tesluk,

          130 Ill. App. 2d at 295 (notice was not imputed to principal when insured was aware that

          agent did not include information regarding nervous breakdown on application because it

          would “ ‘confuse the matter’ ”)). As we noted there, these cited cases do not include the

          situation that occurred here; Associated did not have an adverse interest to First Chicago that

          would result in its being in Associated’s best interest not to provide notice, nor was there any

          fraud in the Metrolift’s application for the policy or in their conduct.

¶ 72         Furthermore, all of the evidence was presented to the trial court as the trier of fact, and

          the trial court determined that there was no evidence of fraud and that there was insufficient

          evidence that it would be against Associated’s interest to reveal the information to First

          Chicago. We cannot find that this decision was against the manifest weight of the evidence,

          and, accordingly, affirm the trial court’s judgment in favor of defendants.



¶ 73                                          CONCLUSION

¶ 74         For the reasons set forth above, we find that (1) Molda was an insured under the terms of

          the First Chicago insurance policy, (2) the trial court did not err in finding Associated to be




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          the apparent agent of First Chicago for purposes of accepting notice, and (3) the trial court

          did not err in finding notice of Molda’s accident to be timely.

¶ 75         Affirmed.




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