State Auto Property and Casualty Insurance Company, Plaintiff-Appellant,
Brumit Services, Inc., an Illinois Corporation, et al., Defendants-Appellees.
October 26, 2017
from the United States District Court for the Southern
District of Illinois. No. 3:15-cv-00956 - Nancy J.
Flaum, Ripple, and Manion, Circuit Judges.
Manion, Circuit Judge.
insurance dispute, insurer State Auto Property and Casualty
Insurance Company seeks a declaratory judgment that it has no
duty to defend insured Brumit Services, Inc., because the
latter failed to provide prompt notice of an accident that
eventually led to a lawsuit. The district court concluded
that the insured's 21-month delay in notifying the
insurer was reasonable and awarded judgment to the insured.
We disagree. Brumit's failure to provide prompt notice of
the accident was inexcusable under Illinois law. Therefore,
we reverse the judgment of the district court.
Brumit owns Brumit Services, Inc., a small business that
performs residential concrete construction work. The company
has two employees and operates out of Brumit's home. On
behalf of the company, Brumit purchased a Business Auto
Liability insurance policy from State Auto to cover the truck
he used for the business.  Like most auto insurance policies,
Brumit's policy provided that State Auto would defend and
indemnify Brumit in the event he was sued for an accident
causing bodily injury or property damage. However, State Auto
had "no duty to provide coverage" unless Brumit
complied with his duties under the policy, one of which was
that Brumit "must give [State Auto] prompt notice of the
'accident' or Toss.'"
September 6, 2013, Brumit was in the parking lot of a
Phillips 66 gas station in Columbia, Illinois, with the
covered truck. When he backed out of his parking space, he
unwittingly struck 68-year-old Del ores Menard with the
truck's tailgate. Menard fell and suffered scrape wounds
on her elbow and knee. She was treated by an EMT and declined
a trip to the hospital, instead choosing to drive herself
home. For his part, Brumit was unaware that he had hit Menard
until a bystander alerted him as he was driving away. He then
came back to the scene, called for an ambulance, and provided
the police officer at the scene with a statement. He observed
that Menard was sitting down and "may have had a scratch
on her knee."
everyone parted ways, Brumit thought the incident so minor
that he was not required to report it to State Auto. But on
June 22, 2015, he was served with a lawsuit in Illinois state
court in connection with the accident. Menard alleged in the
state court complaint that the accident caused her to
"sustain severe, permanent and permanently disabling
injury; including injuries to her back and spine and the soft
tissue structures thereof." She sought damages in excess
of $50, 000. Her husband also sued Brumit, alleging, among
other things, loss of consortium.
next day, Brumit notified State Auto that he had been sued.
State Auto then sought a declaratory judgment in the district
court that it had no duty to defend Brumit in the lawsuit
because Brumit had breached the policy's notice
requirement. The parties filed cross-motions for summary
judgment; the district court granted Brumit's motion and
denied State Auto's. State Auto Prop. & Cas. Ins.
Co. v. Brumit Servs., Inc., 245 F.Supp.3d 1048 (S.D.
111. 2017). The court concluded that Brumit's 21-month
delay in notifying State Auto about the accident was
reasonable as a matter of law. This appeal followed.
Standard of Review and Governing Law
case comes to us on cross-motions for summary judgment with
no disputed facts, so we review the district court's
legal conclusions de novo. "Where facts are not
disputed, if a district court grants one party's motion
for summary judgment and denies the other party's
cross-motion, this court can reverse and award summary
judgment to the losing party below." Glass v.
Dachel, 2 F.3d 733, 739 (7th Cir. 1993). The parties
agree that Illinois law applies. Our job is to apply Illinois
law to the undisputed facts of this case.