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FIRST DIVISION
September 19, 2005

No. 1-03-3370

JUSTICE GORDON delivered the opinion of the court:

Plaintiff, Mark Knauerhaze, brought suit against defendants George W. Allen, M.D. (hereinafter Dr. Allen), and George W. Allen, M.D., S.C., an Illinois corporation (hereinafter Allen Corporation), alleging that Dr. Allen negligently performed surgery on his ear that resulted in permanent injuries. Dr. Allen died during trial, and on Knauerhaze's motion, the trial court appointed Oliver Nelson special representative pursuant to section 2-1008 of the Code of Civil Procedure (735 ILCS 5/2-1008 (West 2004)). On May 22, 2003, a jury found for plaintiff and awarded damages of $2,484,702. The trial court entered judgment on the verdict the same day. Defendants brought a motion for judgment notwithstanding the verdict or, alternatively, a motion for a new trial, arguing that Knauerhaze failed to provide evidence of causation. Defendants further argue that the judgment against Allen Corporation cannot stand because Knauerhaze never proved that Dr. Allen was acting as an agent of the corporation at the time of the surgery such that it could be held vicariously liable. Knauerhaze cross-appeals, alleging that the trial court improperly limited his award through a misinterpretation of section 2-1008. For the reasons that follow, we reverse.

I.  BACKGROUND

In September of 1998, Knauerhaze, an otherwise healthy man in his forties, sought treatment from Dr. Allen for hearing problems with his left ear. Knauerhaze had otosclerosis, a condition where the stapes bone of the middle ear becomes stiff and stops vibrating properly. The middle ear is comprised of three small bones, the malleus, the incus and the stapes. These bones work together to send vibrations to the inner ear where nerves then send signals to the brain. Knauerhaze had lost approximately 50 % of his hearing due to the stiffening of his stapes bone.

Dr. Allen recommended a stapedotomy, a surgery where part of the stapes bone is removed and replaced by a prosthesis which is hooked onto the incus bone with a wire hook. A successful stapedotomy reestablishes the correct interplay of the middle ear bones and can lead to immediate improvement in hearing. A stapedotomy is performed with the surgeon looking into the ear through a microscope at various magnifications. A stapedotomy entails injecting an aesthetic and a blood constricting medication into the ear canal. An incision is then made and the eardrum is moved forward. The bones of the inner ear are then gently pushed to see if they are moving, or are, in fact, showing signs of otosclerosis. If the surgeon verifies that the stapes bone is not moving as it should, a cut is then made between the incus and the stapes with a tiny knife, and the incus is lifted off the top of the stapes. The loop of the prosthesis is then put over the incus bone and the prosthesis is set in place.

Knauerhaze's surgery was scheduled for September 11, 1998, as a day surgery, meaning that Knauerhaze would arrive in the morning, have the procedure, remain in the hospital for a matter of hours for rest and observation, and then return home the same day.

Knauerhaze had diminished hearing before the surgery; however, he was still able to work, drive, walk, run and otherwise participate in normal activities. After the surgery, Knauerhaze lost all hearing in his left ear. The hearing loss resulted in ongoing balance problems and vertigo, which, in turn, led to fatigue from compensating for the loss of balance. He has not been able to return to work, or drive, and is no longer able to walk with ease due to disequilibrium.

On September 8, 2000, Knauerhaze brought suit against Dr. Allen and Allen Corporation alleging that he sustained injuries due to the medical negligence of Dr. Allen. Dr. Allen was the sole stockholder of Allen Corporation, and both Dr. Allen and Allen Corporation were insured by the Illinois State Medical Inter-insurance Exchange for the total sum of $1 million.

Before the case proceeded to trial, Dr. Allen died on September 27, 2001. No letters of officer were issued and no probate estate was opened on his behalf. Rather, Knauerhaze opted to proceed with the litigation by bringing a motion pursuant to section 2-1008(b), which, as shall be set out later, allows a party to proceed with an action against an opponent who dies during litigation by having a special representative appointed to defend the action. 735 ILCS 5/2-1008(b) (West 2004). Section 2-1008(b) allows the party who invokes it to avoid the formalities of opening a probate estate, but it limits the amount recoverable to the liability insurance protecting the decedent's estate. 735 ILCS 5/2-1008(b) (West 2004). On January 18, 2002, the court granted Knauerhaze's section 2-1008(b) motion and appointed Oliver Nelson as special representative for Dr. Allen.

Dr. Allen's notes from the Knauerhaze surgery set forth certain facts of the surgery that are not in dispute. Dr. Allen noted that Knauerhaze's incus bone was much larger than normal. He then noted that in first attempting to put the wire loop of the prosthesis over the incus, the incus became subluxed, or dislocated, when the ligament supporting the incus was torn. Dr. Allen then made several more unsuccessful attempts to place the wire loop over the incus. After these attempts, Dr. Allen noted that there was blood in the vestibule of Knauerhaze's ear. Also, after these several attempts, Dr. Allen noted that Knauerhaze began to retch, broke out into a cold dripping sweat, became nauseated and started to vomit on the operating table. At the same time, Knauerhaze's eyes began to rapidly flick from the left to right, a condition known as nystagmus. At that point, Dr. Allen terminated the surgery and packed Knauerhaze's ear with gel foam. In addition, Dr. Allen saw Knauerhaze a week after the surgery on September 27, 1999, for a follow-up appointment. Dr. Allen's notes from this appointment indicated that he removed the packing from Knauerhaze's ear and that he was still very dizzy. Dr. Allen also indicated that Knauerhaze's hearing was still very bad, that he had mild spontaneous nystagmus to the right, and there was a purulent discharge from the ear.

At trial, Knauerhaze called Dr. Ralph Nelson as an expert witness. Dr. Nelson looked at the operative report and notes of Dr. Allen as well as other medical records and a surveillance tape taken of the plaintiff to make his opinion. Dr. Nelson testified that Dr. Allen was negligent in not properly sizing the wire loop of the prosthesis to fit over Knuaerhaze's large incus bone. Dr. Nelson explained that a subluxed incus becomes totally flaccid and loose and it is significantly more difficult to place the prosthesis loop over a subluxed incus. In Dr. Nelson's opinion, a reasonably well-qualified ear surgeon would have terminated the surgery after subluxing the incus and would have allowed it to heal over a period of months before making any further attempts. According to Dr. Nelson, a prosthesis should not be attached to a subluxed incus because the prosthesis can then go too far into the inner ear and cause damage.

Dr. Nelson also testified that Dr. Allen was negligent in failing to initially open the prosthesis loop wider after noting the large size of Knauerhaze's incus. He further testified that if the prosthesis loop does not initially go over the incus with ease, it should be removed and resized to fit over the bone.

Dr. Nelson acknowledged that the act of subluxing the incus did not, in itself, cause any damage to the nerves of the inner ear. However, Dr. Nelson testified that the retching, sweating, nausea, vomiting, and nystagmus that occurred after Dr. Allen had made several unsuccessful attempts to place the prosthesis loop over the incus were signs of inner ear damage. Furthermore, in Dr. Nelson's opinion, if Dr. Allen had stopped the surgery immediately after subluxing the incus, Knauerhaze would not have had any further injury to his inner ear and no permanent problems.

The Defendant's expert, Dr. Thomas Haberkamp, based his testimony on the same documents as Dr. Nelson and, in addition, he examined Knauerhaze on February 27, 2002. Dr. Haberkamp testified that Dr. Allen complied with applicable the standard of care and was not negligent in operating on the plaintiff. According to Dr. Haberkamp, subluxing the incus is a known and accepted complication of the surgery and does not amount to negligence. Dr. Haberkamp further testified that although it is more difficult to place a prosthesis loop over a subluxed incus, it is not negligent to do so, and it is actually the best way to stabilize a flaccid incus. Additionally, according to Dr. Haberkamp, Dr. Allen's attempts to place the prosthesis loop over the subluxed incus did not cause the complications that followed. Rather, Dr. Haberkamp opined that Knauerhaze's complications where caused by labyrinthitis, which is an inflamation of the inner ear that can be caused by infection or through the introduction of blood into the inner ear. Dr. Haberkamp further testified that labyrinthitis can occur in the absence of negligence and that because blood is always incident to ear surgery, it is always possible for it to travel from the middle ear to the inner ear and cause irritation. Knauerhaze's symptoms of retching, sweating, nausea, vomiting and nystagmus during the surgery were consistent with labyrinthitis, according to Dr. Haberkamp, as was the purulent discharge noted by Dr. Allen in the postoperative period.

Knauerhaze's original complaint dated September 8, 2000, contained the following allegation as count II, paragraph 1:

"At all times relevant to this cause of action, Defendant, George W. Allen, M.D., was and is a physician licensed in Illinois and practiced in the field of otolaryngology and he was an authorized agent, servant and/or employee of George W. Allen, M.D., S.C., and Illinois corporation located in Chicago, Cook County, Illinois."

Defendants admitted this allegation in their answer. However, defendants denied count II, paragraph 2, which stated as follows:

"At all times relevant to this cause of action, Mark Knauerhaze, was under the care and treatment of George W. Allen, M.D., S.C., through its duly authorized agent, George W. Allen, M.D., for purposes of receiving medical care and treatment."

On May 22, 2003, Knauerhaze amended his complaint to properly recite the remaining defendants and to conform the allegations to Supreme Court Rule 213 (134 Ill. 2d R. 213) opinions that were disclosed during pretrial discovery. The amended complaint contained an allegation identical to the allegation in count II, paragraph 1, from the first complaint. However, in its answer to the amended complaint, Allen Corporation did not simply admit this allegation as it previously had but answered as follows:

"George W. Allen, M.D., S.C. admits Dr. Allen was a physician licensed in Illinois and practiced in the field of otolaryngology and makes no answer to the allegations contained in [this allegation] of the Plaintiff's First Amended Complaint at Law because they call for a legal conclusion."

In addition, Knauerhaze made a request pursuant to Supreme Court Rule 237 (134 Ill. 2d R. 237) for certain information to be produced at trial. Defendants filed their response to this request on May 23, 2003, at the beginning of trial. In that response, defendants stated: "Dr. George Allen was insured for $1 million and [Allen Corporation] was covered by Dr. Allen's policy because he was the sole shareholder of the corporation."

Defendants moved for a directed verdict at the close of plaintiff's case and again at the close of their case. The jury returned a verdict for the plaintiff in the amount $2,484,702. On July 3, 2003, defendants then filed a posttrial motion for judgment notwithstanding the verdict and for remittitur. The trial court denied in part and granted in part defendants' posttrial motion. The court did not reduce the amount of judgment as sought but, rather, enforced section 2-1008 with respect to Oliver Nelson as special representative of Dr. Allen.

Subsequently, on July 23, 2003, Knauerhaze opened a probate estate for Dr. Allen and filed a petition for probate of will and for letters of administration. Letters of office were issued for Dr. Allen's estate on September 9, 2003, and the Northern Trust Company (hereinafter Northern Trust) was appointed as the independent executor. On October 20, 2003, Knauerhaze also successfully moved to have Northern Trust substituted as defendant in lieu of the special representative, Oliver Nelson.

On appeal, defendants argue that they are entitled to judgment notwithstanding the verdict because Knauerhaze failed to prove the cause element of the medical negligence cause of action. Defendants contend that Knauerhaze's expert, Dr. Nelson, did not establish how Knauerhaze's inner ear was damaged, but merely established a condition, rather than a cause of the injury. Alternatively, defendants argue that they are entitled to a new trial because the jury's conclusions were against the manifest weight of the evidence because there was no proof of cause. Defendants next contend that the trial court erred in denying their motion for judgment notwithstanding the verdict with respect to Allen Corporation because plaintiff failed to provide any evidence at trial of an agency relationship between Dr. Allen and Allen Corporation that would support a judgment against Allen Corporation for vicarious liability.

Knauerhaze contends that his expert, Dr. Nelson, did provide testimony establishing that Dr. Allen's negligence caused the injuries. In this regard, he appears to argue that the injury as evidenced by the various symptoms Knauerhaze presented during surgery was caused by Dr. Allen's repeated unsuccessful attempts to place the prosthesis loop. Knauerhaze further contends that the defendants' answer to the first complaint constituted a judicial admission, and the fact of agency was, therefore, removed from issue. Knauerhaze further argues that defendants' Rule 237 response admitted agency and should also be considered a judicial admission. Finally, Knauerhaze contends that defendants' failure to submit agency jury instructions constituted a waiver of the issue.

Additionally, Knauerhaze cross-appeals the trial court's determination to limit his recovery against Dr. Allen to the amount of his insurance coverage pursuant to section 2-1008(b). In this regard, Knauerhaze contends that section 2-1008 does not limit a plaintiff's ability to pursue an unsatisfied judgment against a defendant decedent's probate estate when there is a subsequent timely made claim against the estate. Knauerhaze additionally argues that limiting his ability to pursue a claim against Dr. Allen's probate estate after the invocation of section 2-1008 constitutes an unconstitutional legislative remittitur.

II. ANALYSIS OF APPEAL

Defendants' first contention on appeal is that the trial court erred in not granting their motion for judgment notwithstanding the verdict because Knauerhaze failed to prove an essential element of negligence. A judgement notwithstanding the verdict presents a question of law that appellate courts review de novo. McClure v. Owens Corning Fiberglas Corp., 188 Ill. 2d 102, 132, 720 N.E.2d 242, 257 (1999). A trial court should enter judgment notwithstanding the verdict only when all the evidence, viewed in a light most favorable to the nonmovant, so overwhelmingly favors the movant that no contrary verdict could stand based on the evidence. McClure, 188 Ill. 2d at 132, 720 N.E.2d at 257; Pedrick v. Peoria & Eastern R. Co., 37 Ill. 2d 494, 510, 229 N.E.2d 504, 513-14 (1967) . Our supreme court further described the standard in Maple v. Gustafson, 151 Ill. 2d 445, 452-53, 603 N.E.2d 508, 512 (1992):

"A trial court cannot reweigh the evidence and set aside a verdict merely because the jury could have drawn different inferences or conclusions, or because the court feels that other results are more reasonable. [Citations.] Likewise, the appellate court should not usurp the function of the jury and substitute its judgment on questions of fact fairly submitted, tried, and determined from the evidence which did not greatly preponderate either way."Maple, 151 Ill. 2d at 452-53, 603 N.E.2d at 512.

Thus, the standard for obtaining a judgment notwithstanding the verdict is a "very difficult standard to meet," and limited to "extreme situations only." Jones v. Chicago Osteopathic Hospital, 316 Ill. App. 3d 1121, 1125, 738 N.E.2d 542, 547 (2000), quoting People ex rel. Department of Transportation v. Smith, 258 Ill. App. 3d 710, 714, 631 N.E.2d 266 (1994).

The plaintiff in a negligence action must establish that the defendant owed a duty of care, that the defendant breached that duty, and that the plaintiff incurred injuries proximately caused by that breach. Espinoza v. Elgin, Joliet & Eastern Ry. Co., 165 Ill. 2d 107, 114, 649 N.E.2d 1323, 1326 (1995). The existence of a duty is a question of law for the court to decide, while the issues of breach and proximate cause are factual matters for the jury to decide, provided there is a genuine issue of material fact regarding those issues Espinoza, 165 Ill. 2d at 114, 649 N.E.2d at 1326; Thompson v. County of Cook, 154 Ill. 2d 374, 382, 609 N.E.2d 290, 293 (1993).

Defendants do not contest the existence of a duty owed by Dr. Allen to Knauerhaze. Nor do they not contest that Knauerhaze suffered some injury. Rather, they primarily contend that Knauerhaze failed to establish the element of proximate cause because his expert, Dr. Nelson, did not testify to any causal link between Dr. Allen's actions and Knauerhaze's subsequent injuries. Defendants additionally dispute the breach element of negligence by denying that Dr. Allen acted negligently in either subluxing the incus or continuing the surgery. However, their primary argument on appeal is on the element of cause. Defendants contend that continuing the surgery after subluxing the incus should not be viewed as the proximate cause of Knauerhaze's injury because it merely created the condition in which the injury could occur. They further argue that even if Dr. Allen's negligence was a cause in fact of the injury, it was not the legal cause. For these reasons, defendants argue, the jury did not have sufficient evidence to return a verdict for Knauerhaze.

The proximate cause element of negligence consists of both "cause in fact" and "legal cause." Thacker v. UNR Industries, Inc., 151 Ill. 2d 343, 354, 603 N.E.2d 449, 455 (1992). "Cause in fact" involves the question of whether the defendant's negligence had any effect in producing the other's harm, or whether the harm was caused by some other factors. See Restatement (Second) of Torts