Page 1 STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY et al. (State Farm Mutual Automobile Insurance Company, Appellant) v. ILLINOIS FARMERS INSURANCE COMPANY et al., Appellees. Docket No. 103816. SUPREME COURT OF ILLINOIS 226 Ill. 2d 395; 875 N.E.2d 1096; 2007 Ill. LEXIS 1156; 314 Ill. Dec. 809 September 20, 2007, Opinion Filed PRIOR HISTORY: Appeal from the Appellate Court step-down provisions in appellee's policies were contrary for the First District. to Illinois public policy and were void. The appellate State Farm Mut. Auto. Ins. Co. v. Ill. Farmers Ins. Co., court reversed that holding, finding the step-down 368 Ill. App. 3d 914, 858 N.E.2d 519, 2006 Ill. App. provisions were not contrary to Illinois public policy and LEXIS 995, 306 Ill. Dec. 722 (Ill. App. Ct. 1st Dist., were enforceable. The court, after implementing the 2006) various rules of statutory construction, held that nothing in the statutory pronouncements of the Illinois CASE SUMMARY: Legislature prohibited appellee's step-downs since appellee's policies provided coverage to the named insured and permissive users of the named insured's PROCEDURAL POSTURE: Appellant insurer was vehicle in the mandatory minimum amounts. granted leave to appeal the judgment of the appellate court (Illinois), which reversed a trial court order granting OUTCOME: The court affirmed, in part, the judgment it partial summary judgment and held that appellee of the appellate court upholding the validity of the insurer's step-down provisions were not contrary to step-down provisions contained in appellee's policies. public policy and were enforceable. Appellant had The court vacated, in part, the portion of the appellate brought suit seeking declaratory, injunctive, and court judgment addressing the ambiguity and direct monetary relief with respect to the step-down provisions action issues as those issues were not within the in appellee's automobile liability policies. jurisdiction of the appellate court to have been decided. The court remanded the case to the trial court for further OVERVIEW: The suit involved money appellant spent proceedings. covering losses after appellee invoked its step-down provisions in four separate and distinct situations. LexisNexis(R) Headnotes Appellee's step-down provisions reduced the policy limits to the minimum liability limits required under 625 Ill. Comp. Stat. Ann. 5/7-203 (2002) and 625 Ill. Comp. Stat. Ann. 5/7-317(b) (2002), when the insured's vehicle was being operated by a permissive user who was neither a Insurance Law > Motor Vehicle Insurance > Coverage family member residing in the insured's household or a > Compulsory Coverage > Proof of Financial listed driver. The trial court had determined that the Responsibility Page 2 226 Ill. 2d 395, *; 875 N.E.2d 1096, **; 2007 Ill. LEXIS 1156, ***; 314 Ill. Dec. 809 Insurance Law > Motor Vehicle Insurance > Coverage decisions. Terms of an insurance policy that conflict with > No-Fault Coverage > Personal Injury Protection > a statute are void. Terms of an insurance policy cannot General Overview circumvent the underlying purpose of a statute in force at Insurance Law > Motor Vehicle Insurance > Coverage the time of the policy's issuance. > No-Fault Coverage > Property Damage [HN1] 625 Ill. Comp. Stat. Ann. 5/7-203 (2002) and 625 Ill. Comp. Stat. Ann. 5/7-317(b)(3) (2002) require every Governments > Legislation > Interpretation automobile liability insurance policy issued to provide [HN6] The cardinal rule of statutory construction, and the coverage not less than $ 20,000 for the death or bodily one to which all other cannons and rules must yield, is to injury of any one person, $ 40,000 for the death or bodily ascertain and give effect to the true intent and meaning of injury of two or more persons, and $ 15,000 for property the legislature. The most reliable indicator of legislative damage occurring in any one motor vehicle accident. intent is found in the language of the statute. Statutory language is afforded its plain and ordinary meaning. Civil Procedure > Summary Judgment > Standards > Genuine Disputes Insurance Law > Motor Vehicle Insurance > Coverage Civil Procedure > Summary Judgment > Standards > > Compulsory Coverage > General Overview Legal Entitlement [HN7] See 625 Ill. Comp. Stat. Ann. 5/7-601(a) (2002). [HN2] Summary judgment is proper where the pleadings, depositions, admissions, and affidavits on file, viewed in Insurance Law > Motor Vehicle Insurance > Coverage the light most favorable to the nonmoving party, reveal > Compulsory Coverage > General Overview that there is no genuine issue as to any material fact and [HN8] 625 Ill. Comp. Stat. Ann. 5/7-203 (2002) requires the moving party is entitled to a judgment as a matter of every liability insurance policy issued to provide law. coverage of not less than $ 20,000 for the death or bodily injury of any one person, $ 40,000 for the death or bodily Civil Procedure > Summary Judgment > Appellate injury of two or more persons, and $ 15,000 for property Review > Standards of Review damage occurring in any one motor vehicle accident. Civil Procedure > Appeals > Standards of Review > De Novo Review Insurance Law > Motor Vehicle Insurance > Coverage [HN3] Whether summary judgment was appropriate is a > Compulsory Coverage > Proof of Financial matter an appellate court reviews de novo. Responsibility Insurance Law > Motor Vehicle Insurance > Vehicle Civil Procedure > Appeals > Standards of Review > De Use > Permissive Users > Implied Permission Novo Review Insurance Law > Motor Vehicle Insurance > Vehicle Insurance Law > Claims & Contracts > Policy Use > Permissive Users > Omnibus Clauses Interpretation > Appellate Review [HN9] Liability insurance required by 625 Ill. Comp. Insurance Law > Claims & Contracts > Policy Stat. Ann. 5/7-601 (2002) must comply with the Interpretation > Questions of Law requirements of the Illinois Safety and Family Financial [HN4] The construction of provisions contained in an Responsibility Law, 625 Ill. Comp. Stat. Ann. insurance policy is a question of law reviewed de novo. 5/7-317(b)(2) (2002). Section 7-317(b)(2) requires an owner's policy of liability insurance to insure the person named therein and any other person using or responsible Contracts Law > Defenses > Public Policy Violations for the use of such motor vehicle or vehicles with the Insurance Law > Claims & Contracts > Policy express or implied permission of the insured. Provisions Interpretation > General Overview which extend liability coverage to permissive users are [HN5] The terms contained in an insurance policy will be referred to as omnibus clauses, and the Supreme Court of applied as written unless those terms are contrary to Illinois holds that such a clause must be read into every public policy. The public policy of the State of Illinois is liability insurance policy. Section 7-317(b)(3) requires reflected in its constitution, statutes, and judicial every owner's policy of liability insurance to insure every Page 3 226 Ill. 2d 395, *; 875 N.E.2d 1096, **; 2007 Ill. LEXIS 1156, ***; 314 Ill. Dec. 809 named insured and any other person using or responsible Civil Procedure > Trials > Jury Trials > Province of for the use of any motor vehicle owned by the named Court & Jury insured and used by such other person with the express or Governments > Legislation > Interpretation implied permission of the named insured to the extent Governments > State & Territorial Governments > and aggregate amount of $ 20,000 for bodily injury to or Legislatures death of one per son as a result of any one accident and, [HN13] The legislature is vested with the power to enact subject to such limit as to one person, the amount of $ the laws and if the legislation as enacted seems to operate 40,000 for bodily injury to or death of all persons as a in certain cases unjustly or inappropriately, the appeal result of any one accident and the amount of $ 15,000 for must be to the Illinois General Assembly, and not to a damage to property of others as a result of any one court. accident. Insurance Law > Motor Vehicle Insurance > Coverage Insurance Law > Motor Vehicle Insurance > Coverage > Compulsory Coverage > General Overview > Compulsory Coverage > Certificates of Insurance Insurance Law > Motor Vehicle Insurance > Vehicle [HN10] See 625 Ill. Comp. Stat. Ann. 5/5-101(b)(6) Use > Permissive Users > Omnibus Clauses (2002). [HN14] 215 Ill. Comp. Stat. Ann. 5/143.13a (2008) mandates that any policy of private passenger automobile insurance must provide the same limits of coverage to all Insurance Law > Motor Vehicle Insurance > Coverage persons insured under that policy, whether or not an > Compulsory Coverage > General Overview insured person is a named insured or permissive user Insurance Law > Motor Vehicle Insurance > Vehicle under the policy. Use > Permissive Users > Omnibus Clauses [HN11] The omnibus clause contained in the Illinois Safety and Family Financial Responsibility Law, 625 Ill. Civil Procedure > Appeals > Appellate Jurisdiction > Comp. Stat. Ann. 5/7-317 (2002), applies throughout the Final Judgment Rule Illinois Code and applies to the mandatory insurance Civil Procedure > Appeals > Appellate Jurisdiction > requirement set forth in 625 Ill. Comp. Stat. Ann. 5/7-601 State Court Review (2002). Pursuant to custom in the insurance industry, [HN15] The jurisdiction of appellate courts is limited to primary liability is generally placed on the insurer of the reviewing appeals from final judgments, subject to owner of an automobile rather than on the insurer of the statutory or supreme court rule exceptions. operator. Civil Procedure > Pleading & Practice > Defenses, Insurance Law > Motor Vehicle Insurance > Coverage Demurrers & Objections > Motions to Dismiss > Compulsory Coverage > General Overview Civil Procedure > Appeals > Appellate Jurisdiction > Insurance Law > Motor Vehicle Insurance > Vehicle Interlocutory Orders Use > Permissive Users > Omnibus Clauses [HN16] A trial court's denial of a motion to dismiss is an [HN12] A plain reading of the Illinois Safety and Family interlocutory order that is not final and appealable. Financial Responsibility Law, 625 Ill. Comp. Stat. Ann. 5/7-203 (2002), and 625 Ill.