Ernesto Rios was involved in an auto accident with Tony Valenciano and then filed suit against him to secure payment for his damages. When the insured failed to enter an appearance, a default judgment was entered in favor of Rios.
Rios then filed a petition for garnishment against Allied American, which had issued an auto liability policy to Valenciano. Allied denied liability on the grounds it had not been notified of the accident.
The evidence showed that the attorney for Rios had sent a certified letter to Allied in which was enclosed a copy of the complaint.
The insured, by affidavit, stated that upon receipt of the summons and copy of the complaint, he had taken them to his Allied agent, Matteo Cacucciolo, at his office in Aurora. In addition, the insured swore that, two days after the accident, he had notified his agent that he had been involved in an accident. He was told, by the agent, that Allied "would take care of it" and the "lawyers would handle everything." Each time the insured received a notice relative to the accident, he would deliver it to the agent. Each time he was told that Allied "would handle" it.
After the insured was notified that his driver's license had been suspended as a result of his failure to pay the judgment, he went to the company's office in Chicago where he was told it had no record of the accident and would take no action on his behalf because of his failure to comply with his policy.
Moss & Hillison were attorneys for Allied, and they filed an appeal from the judgment entered in favor of Rios for $4,031.50 against Allied. The company did not appeal.
The higher court found that the appeal was frivolous; that Allied had notice of the accident when Rios' attorney had sent a certified letter enclosing copy of the complaint. It had ample opportunity to investigate. The attorneys had made false statements in their response to the garnishment when they stated that Allied had no actual notice of the lawsuit.
The higher court found that the attorneys were liable for sanctions.
Rios and his attorney filed an affidavit with the appeals court showing the legal fees, costs and expenses incurred in defending the appeal. The court ordered Moss & Hillison to pay Rios $6,551.75 in sanctions for the garnishment action, and further awarded Rios a total of $10,263.64 for reasonable attorney fees, costs and expenses incurred in defending the appeal. This was based upon Moss & Hillison's violation of Rule 375(b).
Ernesto L. Rios, v. Tony Valenciano (Allied American Insurance
Company, Garnishee; Moss & Hillison, a/k/a Moss, Hillison
and Mordini, Appellant)--No. 2-94-1017--Appellate Court of Illinois,
Second District--June 28, 1995--652 North Eastern Reporter 2d
416.