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Hana v. Illinois State Medical Inter-Insurance Exchange Mutual Insurance Co.

2018 IL App (1st) 162166 (Ill. App., 2018)

Words & Phrases

Bad Faith: Failure To Settle

Trial Judge

Irwin Solganick

Appellate Judge



Existing pattern jury instructions, IPI Civil Nos. 710.02 and 710.03 (2011), do not accurately state elements of bad faith failure to settle in light of Illinois Supreme Court’s decision in Haddick ex rel. Griffith v. Valor Insurance, 198 Ill. 2d 409, 417 (2001), which refer to "reasonable probability" of recovery.

Fact Summary

Plaintiffs-appellees, Alizabeth Hana and Elvin Hana, filed this suit against defendant- appellant, Illinois State Medical Inter-Insurance Exchange Mutual Insurance Company (ISMIE), seeking to recover for ISMIE’s alleged bad-faith failure to settle an underlying lawsuit. A jury ruled in favor of plaintiffs, entered a multimillion dollar verdict against ISMIE, and ISMIE thereafter appealed raising a host of issues. For the following reasons, we reverse and remand for a new trial.

1.  we conclude that this matter must be remanded for a new trial due to the denial of ISMIE’s constitutional right to a 12-person jury.  Kakos v. Butler, 2016 IL 120377.

2. we agree with ISMIE that any evidence of the 2013 settlement offer was barred by Rule 408. While Rule 408 does allow the introduction of evidence of settlement offers and negotiations to establish bad faith, we do not believe that this exception includes the introduction of evidence with respect to the settlement of the present litigation so as to establish ISMIE’s bad faith with respect to its handling of the underlying case.

3. neither IPI Civil (2011) No. 710.02 nor IPI Civil (2011) No. 710.03 fairly and accurately reflects the current state of the law.