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Kim v. Alvey, Inc.
State: Illinois
Court: 1st District Appellate
Docket No: 1-99-2523 Rel
Case Date: 03/30/2001

THIRD DIVISION
March 30, 2001

 

 

 

No. 1--99--2523

LANNIE C. KIM, Individually and as
Special Administrator of the ESTATE
OF JOHN PAUL KIM, Deceased,

           Plaintiff-Appellee,

                     v.

ALVEY, INC., a corporation,

           Defendant and Third-Party
           Plaintiff-Appellant,

                     v.

KRAFT FOODS, INC.,

           Third-Party Defendant-
           Appellee,

(and SVERDRUP CORPORATION,

           Defendant).

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Appeal from the
Circuit Court of
Cook County.



















Honorable
Richard B. Berland,
Judge Presiding.

 

JUSTICE BURKE delivered the opinion of the court:

Defendant and third-party plaintiff Alvey, Inc. (Alvey)appeals from orders of the circuit court: (1) entering judgment on a juryverdict in favor of plaintiff Lannie Kim; (2) finding, on plaintiff's motion toenforce settlement agreement between plaintiff and Alvey, a binding settlementand enforcing that agreement; (3) approving the distribution of settlementproceeds; and (4) allowing third-party defendant Kraft Foods, Inc. (Kraft) towaive its workers' compensation lien, granting Kraft's motion to dismiss Alvey'sthird-party complaint, and dismissing Alvey's posttrial motion seeking adirected verdict, judgment notwithstanding the verdict, vacatur of the juryverdict and entry of judgment in its favor, or a new trial, as moot. On appeal,Alvey contends that the trial court erred in considering Kraft's posttrialmotion seeking to dismiss Alvey's third-party complaint because the motion wasuntimely, and the trial court erred in dismissing Alvey's third-party complaintwithout awarding Alvey a credit for Kraft's liability. Alternatively, Alveycontends that the trial court erred in finding that the parties had reached abinding oral settlement agreement, or that the trial court erred in denying asmoot Alvey's posttrial motion, or that the trial court erred in determining thatAlvey was not entitled to a credit in the amount of Kraft's workers'compensation lien against the jury verdict. For the reasons set forth below, weaffirm.

STATEMENT OF FACTS

While working at a Nabisco plant (now Kraft), John Paul Kim'sneck was crushed in a pinch-point on a palletizing machine manufactured by Alvey.Plaintiff Lannie Kim (Kim), John's wife, filed a complaint against Alvey andSverdrup Corporation, also involved in the manufacture of the machine, on behalfof herself individually and as special administrator of the estate of herhusband, alleging wrongful death and survival actions on the bases of negligenceand products liability. Alvey, in turn, filed a third-party complaint againstKraft, John's employer, for contribution.

Following a trial on plaintiff's complaint, the jury returneda verdict on January 27, 1999, finding for Kim against Alvey, and for Alveyagainst Kraft. The jury awarded Kim $2,250,000. The jury apportioned liabilityas follows: John, 25% negligent; Alvey, 25% negligent; and Kraft, 50% negligent.The trial court entered judgment on the jury verdict the same day. The trialcourt also entered an order amending the verdict, adding $28,884 for medical andfuneral expenses. Based on the jury apportionment of liability, Kraft wasobligated to pay $854,581 under the jury verdict. Kraft's workers' compensationlien, although not finally determined, was alleged to be approximately $396,000.

On January 28, 1999, Alvey's attorney, Thomas Doell, offered$1.5 million to plaintiff's attorney, Shawn Kasserman, to settle the matter. Tothat end, correspondence was exchanged on January 29. Kasserman wrote to Alvey'sinsurance adjuster, Laurie Sacchitella, confirming the settlement for $1.5million and requesting a check by February 2. Deborah Nico, Kraft's counsel,advised Sacchitella that Kraft did not want its name on the settlement draft. Adispute subsequently arose between Kasserman and Doell as to the settlement. Itwas Doell's belief that the amount of Kraft's workers' compensation lien wouldbe set off from the $1.5 million settlement amount. Kasserman did not agree.

On February 2, plaintiff filed an emergency motion to enforcethe settlement. At the hearing on the motion on the same day, Alvey argued thatthe settlement amount was gross, not net, and that the parties agreed to workout the workers' compensation lien later. Kraft's counsel argued that Kraftcould waive its workers' compensation lien at any time which would satisfy itsobligation and extinguish its liability on the contribution claim. Following thehearing, the trial court entered an order requiring Alvey's insurance carrier todeposit its check with the clerk of the court, and continued the case.

On February 26, Alvey filed a posttrial motion seeking adirected verdict or judgment notwithstanding the verdict in its favor, vacaturof the jury verdict and entry of judgment in its favor, or a new trial. On March2, Kraft filed a motion, requesting that the court dismiss Alvey's third-partycomplaint and accept a waiver of its workers' compensation lien. On March 11,Alvey filed a motion to dismiss plaintiff's motion to enforce the settlement. Onthe same day, Alvey also filed its response to Kraft's motion in which itcontended that Kraft's motion was untimely, that Kraft failed to raise the lienissue before, and that Kraft never timely raised its alleged affirmative defenseto limit the amount of setoff to its workers' compensation lien as requiredpursuant to Kotecki v. Cyclops Welding Corp., 146 Ill. 2d 155, 165, 585N.E.2d 1023 (1991), and, therefore, waived it.

On March 24, the trial court denied Alvey's motion to dismissKraft's motion and ordered that an evidentiary hearing be held on plaintiff'smotion to enforce settlement. On the same day, plaintiff filed a petition toapprove distribution of the settlement proceeds. This motion was later granted,on May 25, at which time the trial court dismissed plaintiff's complaint againstAlvey.

On April 9, after a series of continuances, an evidentiaryhearing was held on plaintiff's motion to enforce the settlement. The partiesfirst agreed that the depositions that had been taken of Sacchitella, Kasserman,and Nico would stand as evidentiary depositions. Alvey then presented itsarguments to the court, contending that Kasserman negotiated with its adjuster (Sacchitella)who was unrepresented by counsel and who did not know the mechanics of liens,and arguing that Kraft could not waive its lien because it did not know theamount of the lien and it had failed to file a timely posttrial motion. Doell,Kasserman, and Sacchitella also testified at the hearing. Kasserman's andSacchitella's testimony was consistent with that given in their respectivedepositions, although the deposition testimony provided greater detail.

Doell's testimony at the hearing was basically that there wasmore to the agreement than payment of $1.5 million "flat." Accordingto Doell, the offer was dependent upon recovering the amount of Kraft's workers'compensation lien.

In substance, Kasserman's testimony was that the offer andagreement was $1.5 million with no credit or set off. Kasserman stated thatthere were no discussions between either him and Doell or him and Sacchitellaconcerning the lien, a setoff, or paying the money back. He did state, however,that prior to beginning settlement negotiations with Doell, the lien wasmentioned. Specifically, Kasserman stated that he asked Doell if Doell wasconcerned that Kraft might waive the lien out from under Doell, and Doell statedthat Kraft could not do that because Alvey had a judgment against Kraft.According to Kasserman, the only terms of the settlement were that Alvey wouldpay $1.5 million and the check would be delivered to Kasserman's office by theend of the business day on Tuesday, February 2.

Sacchitella, Alvey's insurance adjuster, testified, insummary, that when she and Doell discussed the settlement on Thursday January28, it was $1.5 million gross, that Doell advised her not to worry about thelien, and that Doell told her the lien was to be worked out the next week eithervia a credit or payment from Kraft. Sacchitella stated that she did not know howshe was to get the money back but "always expected to" to get it back.According to her, recovery of the amount of the workers' compensation lien wasvery important.

Pursuant to the parties' agreement, the trial court, prior toruling on plaintiff's motion to enforce the settlement agreement, consideredboth Kasserman's and Sacchitella's deposition testimony, which again wasconsistent with the above summarized testimony, along with the depositiontestimony of Deborah Nico, Kraft's attorney. Nico testified at her depositionthat she spoke with both Doell and Kasserman on Friday, January 29. Nicobelieved she first told both Doell and Kasserman that Kraft would waive its lienand thereafter both stated that they were trying to settle the case. Nico statedthat she specifically told Doell that Kraft was going to waive its lien and hereplied, "Fine. No problem." On Monday, February 1, Nico received acall from Doell. She got the idea that Doell wanted a check from Kraft in theamount of its workers' compensation lien, but advised Doell that Kraft hadwaived its lien and that was the extent of Kraft's obligation. Nico furtherstated that she got the impression that Doell was not familiar with the effectof a lien waiver and that Doell realized, for the first time in his conversationwith her on Monday, what had happened regarding the issue of a setoff of Kraft'slien, e.g., there would be no credit or set off from the $1.5 millionsettlement.

On April 12, the trial court issued its decision, findingthat there was a meeting of the minds and it was not of the opinion that thesettlement offer was conditioned upon Alvey receiving a credit or setoff ofKraft's lien. Accordingly, the court ordered enforcement of the settlementagreement and release of the check to plaintiff.

On June 4, Alvey filed a memorandum in opposition to Kraft'smotion seeking a dismissal of Alvey's third-party complaint and acceptance ofits lien waiver. On June 16, the trial court heard arguments on Kraft's motion,at which time only Kraft's and Alvey's attorneys were present. The trial courtnoted that Alvey had no judgment against Kraft, disagreeing with Alvey'sargument that judgment had been entered on Alvey's counterclaim. The court thenissued its opinion, allowing Kraft to waive its workers' compensation lien andgranting Kraft's motion to dismiss Alvey's third-party complaint. The courtfurther concluded that Alvey's posttrial motion was moot by virtue of thecourt's decision on April 12, 1999, at which time the court had found a validsettlement agreement between plaintiff and Alvey. This appeal followed.

ANALYSIS

I. Kim's Motion to Dismiss Appeal

Subsequent to the filing of this appeal, Kim filed a motionto dismiss the appeal based on lack of jurisdiction over those portions of theappeal that relate to the claims against Kim. We took the motion with the case.In her motion, Kim alleges that the trial court's April 12, 1999, orderenforcing the settlement was a final and appealable order. Kim argues that Alveywas required, but failed, to appeal the April 12 order within 30 days pursuantto Supreme Court Rule 304(a). 155 Ill. 2d R. 304(a).

Alvey argues that Rule 304(a) is not applicable because theApril 12 order was not a final judgment and it did not contain the requisitelanguage to make the order immediately appealable. According to Alvey, Kim'sclaims against Alvey were not finally disposed of until May 25 when the trialcourt dismissed Kim's complaint against Alvey.

"In Illinois, a judgment is considered final only if it'finally disposes of the rights of the parties either upon the entirecontroversy or upon some definite and separate branch thereof.' [Citation.] Afinal judgment 'decides the controversy between the parties on the merits andfixes their rights, so that, if the judgment is affirmed, nothing remains forthe trial court to do but to proceed with the execution.' [Citation.]" Pempekv. Silliker Laboratories, Inc., 309 Ill. App. 3d 972, 978, 723 N.E.2d 803(1999).

We find that the May 25, 1999, order was a final order as tothe claims between Alvey and Kim, disposing of all litigation and claims betweenthem. There was nothing left to do but enforce the judgment, which the trialcourt did in the same order by mandating the release of the settlement draft toKim. However, the May 25 order did not dispose of the claims between Alvey andKraft. Alvey's counterclaim remained pending until June 16, 1999. Because theMay 25 order disposed of less than all the claims involved in the lawsuit,appellate jurisdiction would only exist pursuant to Supreme Court Rule 304(a),which requires an express finding by the trial court that there is no justreason to delay enforcement or appeal or both. There was no such finding by thetrial court in the instant case. Because "this case is a multiparty action,and the trial court did not include Rule 304(a) language," there would beno appellate court jurisdiction from an appeal from the May 25 order. See Puleov. McGladrey & Pullen, 315 Ill. App. 3d 1041, 1046, 735 N.E.2d 710(2000). Thus, the claims raised before the trial court were not appealable untilthe trial court entered its order on June 16, disposing of all claims in thelitigation. Accordingly, we deny Kim's motion to dismiss this appeal.

II. Trial Court's Jurisdiction
Over Kraft's Posttrial Motion

Alvey contends that the trial court lacked jurisdiction overthe issues raised in Kraft's posttrial motion because Kraft failed to timelyfile the motion. According to Alvey, pursuant to section 2--1202 of the Code ofCivil Procedure (735 ILCS 5/2--1202 (West 1998)), Kraft had until February 26 tofile its posttrial motion, but did not file it until March 2 and, therefore, thetrial court lost jurisdiction to consider the motion and the judgment enteredagainst Kraft on January 27 "stands."

Kraft contends that the trial court had jurisdiction.According to Kraft, section 2--1202 is not applicable because Kraft's motion wasbased on Kraft's waiver of its workers' compensation lien, which was aprocedural rather than a substantive motion attacking the judgment and,therefore, it was not a posttrial motion. According to Kraft, its motion did notseek to preserve or correct any errors committed by the trial court, nor did itseek to attack the judgment; Kraft only sought to enforce its legal right toextinguish its contributory liability by waiving its workers' compensation lien.

We briefly note that the trial court's ruling, that becauseAlvey filed a timely posttrial motion Kraft was excused from timely filing aposttrial motion, is erroneous. Illinois law is clear that the fact that oneparty files a timely posttrial motion does not excuse another party's obligationto file its posttrial motion within the statutory 30-day period after entry ofjudgment. Burnidge Corp. v. Stelford, 309 Ill. App. 3d 576, 579, 723N.E.2d 394 (2000).

With respect to the 30-day time limit for filing a motionafter entry of judgment, in Star Charters v. Figueroa, 192 Ill. 2d 47,733 N.E.2d 1282 (2000), the Illinois Supreme Court held that a defendant'sposttrial motion requesting a setoff from amounts paid by other defendantspursuant to a settlement agreement need not be filed within 30 days after entryof judgment. The supreme court held that

"a defendant's request for setoff to reflect amounts paid by settling defendants seeks not to modify, but rather to satisfy, the judgment entered by the trial court. [Citations.] Such a request does not arise as a result of trial, but is instead in the nature of a supplementary or enforcement proceeding within the inherent power of the judgment court. Because the request is not a motion directed against the judgment, it is not subject to the 30-day time limit applicable to post-trial motions." (Emphasis in original.) Star Charters, 192 Ill. 2d at 48-49.

In Jackson v. Polar-Mohr, 115 Ill. App. 3d 571, 450N.E.2d 1263 (1983), an employer filed a petition to intervene in its employee'slawsuit against a negligent tortfeasor defendant. Following a jury verdict inthe plaintiff's favor against the defendant, both the plaintiff and thedefendant filed timely posttrial motions. In his motion, the plaintiff sought todismiss the petition to intervene. The trial court granted the motion on thebasis that the employer had failed to file anything with the court within 30days of judgment to cause the court to act on the petition to intervene. Jackson,115 Ill. App. 3d at 573. The Jackson court reversed, holding that thetrial court erred in denying the employer relief because the employer did notneed to file a posttrial motion within the 30-day period pursuant to section2--1202. Specifically, the court stated:

"Since the issue before the trial court did not concern trial error but rather a distinct and collateral claim by an intervening party, section [2--1202] does not apply. [The employer] [does] not seek to challenge the validity or correctness of the judgment, but simply to assert its lien on the proceeds of that judgment." Jackson, 115 Ill. App. 3d at 573.

While none of these cases involve the specific facts beforethis court, they are instructive. In its motion, Kraft sought to waive itsworkers' compensation lien and to dismiss Alvey's third-party complaint. Byvirtue of this motion, Kraft sought to satisfy the judgment enteredagainst it on January 27 and extinguish its contributory liability. Kraft didnot seek to vacate or correct the judgment. Based on Star Charters, Siegel,and Jackson, Kraft was not required to file its motion within 30 daysafter entry of the judgment on the jury's verdict in order for the trial courtto have jurisdiction.

Based on the foregoing, we conclude that the trial court hadjurisdiction over Kraft's motion.

III. Propriety of Trial Court's Decision
Allowing Kraft to Waive Its Lien and
Dismissing Alvey's Third-Party Complaint

Alvey next contends that Kraft waived its alleged affirmativedefense to limit the amount of setoff to its workers' compensation lien pursuantto Kotecki by failing to raise it prior to judgment. Alvey argues thatthe Kotecki setoff limit is an affirmative defense that is treated as anyother affirmative defense; if it is not raised, it is waived. Alvey maintainsthat because Kraft first raised its defense in its posttrial motion, it waivedthe issue.

In Kotecki, the court held that an employer is liablefor contribution to a third party only to the extent of its "workers'compensation liability." Kotecki, 146 Ill. 2d at 165. While severalcases have referred to the Kotecki limit as an affirmative defense (Christy-Foltz,Inc. v. Safety Mutual Casualty Corp., 309 Ill. App. 3d 686, 688, 722 N.E.2d1206 (2000); Duncan v. Church of the Living God, 278 Ill. App. 3d 588,594, 662 N.E.2d 1371 (1996)), we do not agree with Alvey that if the Koteckilimit or workers' compensation lien is not raised prior to trial as anaffirmative defense, it is waived.

We find LaFever v. Kemlite Co., 185 Ill. 2d 380, 706N.E.2d 441 (1998), directly on point. In LaFever, the plaintiff sued thedefendant Kemlite for injuries he sustained while working on Kemlite's premises.Kemlite then filed a third-party complaint against Banner Western Disposal(Banner), the plaintiff's employer. The jury returned a verdict in theplaintiff's favor in the amount of $1,122,261. The jury further found thatBanner was liable to Kemlite on the third-party complaint. Banner filed aposttrial motion seeking to waive its workers' compensation lien to satisfy itscontributory liability. The trial court granted Banner's motion and dismissedthe third-party complaint. LaFever, 185 Ill. 2d at 387.

The appellate court reversed the trial court's order grantingBanner's posttrial motion, finding that the statutory lien could not be waivedafter entry of the jury verdict. LaFever, 185 Ill. 2d at 388. The supremecourt reversed, noting that an employer can waive the lien it holds on any thirdparty recovery and avoid liability for contribution to other tortfeasors. LaFever,185 Ill. 2d at 399. The supreme court further noted that whether Banner waivedthe lien or not, its contributory liability was always limited to the amount ofits workers' compensation lien. Specifically, the LaFever court stated:"Whether Banner waived its lien before or after the verdict, Koteckiand its progeny limited the maximum contribution liability for Banner to theamount paid by Banner in workers' compensation." LaFever, 185 Ill.2d at 404. The LaFever court thus concluded that it was proper for Bannerto raise its lien in a posttrial motion and to waive the lien after the juryverdict. LaFever, 185 Ill. 2d at 405.

LaFever clearly allows an employer to raise its lienin a posttrial motion. Alvey's argument that the Kotecki setoff limit isas an affirmative defense that must be raised prior to trial is not supported byexisting case law. We therefore reject Alvey's waiver argument and hold that thetrial court properly allowed Kraft to raise and waive its lien. These casesillustrate that an employer is not required to raise its Kotecki setofflimit or workers' compensation lien as an affirmative defense or even before atrial. Clearly, an employer may raise the issue of its liability limit in asubsequent proceeding when it is not a part of the third-party action. Deckeris instructive because the workers' compensation lien is akin to the lienaddressed in Decker; the workers' compensation lien is in the nature ofsatisfaction of a judgment, not in the nature of a counterclaim.

Based on the foregoing, we conclude that the trial court hadjurisdiction over Kraft's motion to waive its lien and dismiss Alvey'sthird-party complaint.

IV. Settlement Agreement

Alvey next contends that the trial court erred in findingthat Alvey and plaintiff entered into an enforceable settlement agreement.

Illinois encourages the settlement of claims and, to thatend, settlement agreements may be oral. Stone v. McCarthy, 206 Ill. App.3d 893, 901, 565 N.E.2d 107 (1990). Enforcement and construction of settlementagreements is governed by the law of contracts. Lampe v. O'Toole, 292Ill. App. 3d 144, 146, 685 N.E.2d 423 (1997). "As with any contract, theremust be an offer, an acceptance, and a meeting of the minds on terms." Lampe,292 Ill. App. 3d at 146. An oral settlement agreement is enforceable absentfraud or mistake (Lampe, 292 Ill. App. 3d at 146), or duress (Johnsonv. Hermanson, 221 Ill. App. 3d 582, 585, 582 N.E.2d 265 (1991)). However, aunilateral mistake does not render the agreement unenforceable (Cole TaylorBank v. Cole Taylor Bank, 224 Ill. App. 3d 696, 708, 586 N.E.2d 775 (1992); Johnson,221 Ill. App. 3d at 585)), and has no effect on the validity of the agreementitself (In re Marriage of Lorton, 203 Ill. App. 3d 823, 826, 561 N.E.2d156 (1990)). Whether the parties intended any condition as a term is a questionof fact. Lampe, 292 Ill. App. 3d at 147. The determination of whether avalid settlement occurred is in the trial court's discretion and we will notreverse its decision unless it is contrary to the manifest weight of theevidence, e.g., unless an opposite conclusion is clearly apparent. Websterv. Hartman, 309 Ill. App. 3d 459, 460, 722 N.E.2d 266 (1999).

Alvey's first argument against enforcement of the settlementagreement is that Kasserman improperly renegotiated with Sacchitella withoutDoell's consent, review, or approval, and that Rule 4.2 of the Rules ofProfessional Conduct prohibits an attorney (Kasserman in this case) fromcommunicating with a party represented by counsel (Sacchitella), which Kassermanviolated on January 29, 1999, by renegotiating the settlement with Sacchitella.According to Alvey, Kasserman's "duplicitous conduct was clearly intendedto trick Ms. Sacchitella"--a layperson who was unaware of the mechanics ofliens and the legal import of Kasserman's statements. Thus, Alvey maintains thatbecause of Kasserman's inappropriate conduct, which was "contrary to publicpolicy and morals," the settlement agreement should not have been enforced.

We find Alvey's argument incredulous. It is customary in thepersonal injury field for plaintiffs' attorneys to negotiate for settlement withinsurance adjusters and other relevant personnel without defense counsels'presence or involvement. Sacchitella admitted in her deposition that she hadauthority to negotiate without Doell and, in fact, had done so on numerousoccasions throughout these proceedings. We also find Alvey's argument, thatSacchitella was "trickable" because she was a "layperson"and not an attorney and was without pertinent knowledge, absurd. As plaintiffpoints out, Sacchitella held a high position with the insurance carrier and hadbeen in the business for at least 18 years. While she claimed not to know the"mechanics" of liens, it is clear from her testimony that she knew ofthe existence of Kraft's workers' compensation lien and knew that third-partytortfeasors generally have a right to a credit or setoff of the amount paid bythe workers' compensation carrier to a plaintiff. Sacchitella could have raisedthe lien issue in her discussions with Kasserman. In essence, Alvey is accusingplaintiff's counsel of deceptive or fraudulent conduct. This is very disturbingto us and will be further addressed below.

Alvey next argues that the parties did not have a meeting ofthe minds--Doell and Sacchitella believed that the $1.5 million figure was grossand that it would be reduced or set off by the amount of Kraft's workers'compensation lien, whereas Kasserman believed that the amount was net. Basedupon a thorough review of the deposition and hearing testimony with respect tosettlement negotiations, it is abundantly clear that a setoff or credit as acondition of the settlement was never mentioned by either Doell orSacchitella in any of the discussions with Kasserman. Since Kasserman didmention the lien to Doell prior to the time Doell made his offer toKasserman, if Doell believed that a setoff or credit was a condition of thesettlement offer, he beyond question would have said something to Kasserman whenhe made the offer, particularly given the fact that the lien had been mentionedjust prior to the offer. Further, it is also clear that Doell and Kasserman wereadvised, prior to settlement negotiations, that Kraft would waive its lien.Thus, if a setoff was intended to be a condition of the settlement, Doelllogically would have discussed it with Kasserman. Similarly, while Sacchitellastated that the setoff or credit was important to her, she too failed to mentionanything to Kasserman about a setoff or the fact that Doell advised her the lienissue would be worked out the next week. Again, if a setoff was meant to be aterm of the settlement, it would be logical for Sacchitella to raise it at thetime of her discussions with Kasserman. This is particularly true when the twodiscussed who would be named on the settlement draft.

Plaintiff's contention that this case involves a unilateralmistake on the part of Doell has merit. It is clear from Nico's testimony thatDoell was not aware of the ramifications of LaFever, nor of the effect ofa lien waiver. Nico's testimony also indicates that Doell did not realize theeffect of the waiver until he spoke with her on Monday. It was only at thistime, that Doell raised the issue.

Based on the evidence in the record, we conclude that anopposite conclusion as to the terms of the settlement agreement is not clearlyapparent in this case. There was ample evidence to support the trial court'sdecision that a setoff was not a condition of the settlement offers made byDoell on Thursday, January 28, and Sacchitella on Friday, January 29, and thatthe parties had a meeting of the minds on the material terms of the settlementagreement. Accordingly, we hold that the trial court's decision was not againstthe manifest weight of the evidence and, therefore, we will not disturb itsfinding.

Lastly, Alvey contends that plaintiff will receive a doublerecovery if a setoff is not allowed.

In Illinois, a plaintiff is entitled to only one recovery foran injury and a double recovery is against public policy and condemned. Pearsonv. Stedge, 309 Ill. App. 3d 807, 813, 723 N.E.2d 773 (1999). Thus,generally, any judgment or settlement with a third party must be offset by theamount of workers' compensation benefits recovered by a plaintiff, even when theemployer waives the workers' compensation lien. Eastman v. Messner, 188Ill. 2d 404, 412-13, 721 N.E.2d 1154 (1999).

Following the jury verdict here, plaintiff was entitled to$1,709,163, after reduction for plaintiff's decedent's contributory negligence.Under normal circumstances, the workers' compensation lien would be a setofffrom this amount when plaintiff sought to execute on the judgment. However, wedo not have normal circumstances in the instant case because the parties enteredinto a valid settlement agreement, which did not include a provision that theworkers' compensation lien would be set off from the settlement amount.

In In re Salmonella Litigation, 249 Ill. App. 3d 173,183, 618 N.E.2d 487 (1993), the court held that the double recovery doctrine"should not apply to settlements because a settlement is a contract whichgoverns the plaintiff's recovery." In Salmonella, the plaintiffsreceived certain sums from their insurance carrier under their employee healthbenefits insurance. The plaintiffs then settled with Jewel which claimed a lienon the insurance payments. The trial court refused to allow a lien because thesettlement agreement did not expressly provide for a setoff. Salmonella,249 Ill. App. 3d at 175. The Salmonella court agreed with the trialcourt, which had reasoned:

"This is a contract case. This motion does not involve a payment required by a judgment entered against Jewel. It involves a settlement agreement negotiated by Jewel and the claimants-plaintiffs." Salmonella, 249 Ill. App. 3d at 183.

We find Salmonella persuasive and adopt its reasoninghere. Alvey freely and voluntarily negotiated a settlement following the juryverdict, which did not provide for any setoff. Because this was a negotiatedcontract, which governs Alvey's payment and not a payment required pursuant to ajudgment, the double recovery doctrine does not apply.

Based on our conclusion that the parties reached a validsettlement, we need not address Alvey's further contentions that we must remandthis cause for a determination on its posttrial motion and that it is entitledto a setoff from the jury verdict; both issues are moot since the jury verdictwas superseded by the settlement.

RULE 375

Neither plaintiff nor Kraft have specifically requestedsanctions, but this court may invoke Supreme Court Rule 375(b) on its owninitiative where it deems it appropriate. 155 Ill. 2d R. 375(b); FirstFederal Savings Bank of Proviso Township v. Drovers National Bank of Chicago,237 Ill. App. 3d 340, 344, 606 N.E.2d 1253 (1992). Rule 375 provides: "If,after consideration of an appeal or other action pursued in a reviewing court,it is determined that the appeal or other action itself is frivolous, or that anappeal or other action was not taken in good faith, for an improper purpose ***,an appropriate sanction may be imposed upon any party or the attorney orattorneys of the party or parties." 155 Ill. 2d R. 375(b). We believe that,absent a showing by Alvey to the contrary, this appeal is frivolous and nottaken in good faith but rather for an improper purpose, thus warrantingsanctions. First Federal Savings Bank, 237 Ill. App. 3d at 344. Alvey'simproper purpose is to correct its trial counsel's error. The insurance companygave plaintiff a check for $1.5 million which clearly stated on its face,"Full and Final Settlement." On appeal, Alvey now contends that thisis not what it really intended to do and that the settlement was not full andfinal, nor was it complete. What we have in this case is an unhappy defendantand its counsel because of an error trial counsel made. Since Doell apparentlylacked knowledge of the law regarding waiver and setoff of workers' compensationliens and, therefore, failed to protect Alvey and its insurance carrier, Alvey'sappellate attorneys are now attempting to ignore Doell's mistake and lack ofknowledge of the law by accusing plaintiff's counsel of fraudulent conduct.

We further observe that Alvey's counsel, in filing thisappeal, make groundless arguments to this court. Rule 375 imposes upon Alvey'scounsel, "a good-faith duty *** to refrain from making arguments beforethis court that are clearly contradicted by th[e] record" and law. SacramentoCrushing, Corp. v. Correct/All Sewer, Inc., No. 1--99--0882, 1--00--2313(Cons.), slip op. at 12 (December 29, 2000). Alvey's counsel accuse opposingcounsel of fraud predicated upon Kasserman's negotiations with an experienced,high-positioned insurance director. Alvey's counsel are even bold enough toargue that plaintiff's counsel violated Rule 4.2--a contention without anysupport in fact or law. Alvey isolates one negotiation session between Kassermanand Sacchitella, ignoring the prior repeated negotiations between Kasserman andSacchitella. Clearly, insurance adjusters do not need defense counsel'spermission to negotiate with a plaintiff's counsel. In fact, it is defensecounsel who needs authority from an insurance carrier to negotiate a potentialsettlement with a plaintiff since the settlement funds ultimately come from thecarrier. Alvey's argument that Kasserman acted deceptively and fraudulently isentirely unfounded. "The decision to accuse an opposing party or itscounsel of perpetrating a fraud on the court is a momentous one. When thedecision is made to go forward on such a charge, one would hope that thecharging party was solidly armed with competent, clear, and convincing evidencesupporting his theory." Sacramento Crushing, Corp., No. 1--99--0882,1--00--2313 (Cons.), slip op. at 13. Here, we are particularly disturbed thatAlvey's counsel chose to accuse a fellow officer of the court of an offensepossibly meriting disbarment for the sole purpose of ignoring Doell's mistakeand lack of knowledge of the law, in particular, LaFever.

Based on the foregoing, we thus order Alvey and its appellatecounsel to show cause why a sanction should not be imposed on the ground thatthis appeal is frivolous under the standard of Supreme Court Rule 375(b). ShouldAlvey and its counsel fail to make such a showing, we shall consider this abasis for sanctions. See First Federal Savings Bank, 237 Ill. App. 3d at346. Our decision on this matter is not meant to discourage attorneys fromzealously representing their clients or from bringing appeals that have arguablemerit. However, unless Alvey and its counsel are able to persuade us otherwise,this is not such an appeal. See First Federal Savings Bank, 237 Ill. App.3d at 347. Accordingly, we direct Alvey and its counsel to file a brief ormemorandum with this court, within 14 days of the date of the instant order,showing why we should not impose sanctions or attorney fees under Supreme CourtRule 375(b). If we decide thereafter that this appeal warrants sanctions, weshall order plaintiff to file a statement of reasonable expenses and attorneyfees incurred as a result of this appeal, to which Alvey and its counsel willhave an appropriate opportunity to respond. Thereafter, this court will file asupplemental opinion or order determining the amount of the sanction to beimposed upon Alvey and its counsel. See First Federal Savings Bank, 237Ill. App. 3d at 347-48.

CONCLUSION

For the reasons stated, we affirm the judgment of the circuitcourt of Cook County.

Affirmed.

HALL, P.J., and WOLFSON, J., concur.

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