State Farm Insurance Co. v. Kazakova

Case Date: 10/14/1998
Court: 1st District Appellate
Docket No: 1-97-0125

THIRD DIVISION

OCTOBER 14, 1998







1-97-0125





STATE FARM INSURANCE COMPANY,
as subrogee of Robin Depender,

Plaintiff-Appellee,

v.

STELLA KAZAKOVA,

Defendant-Appellant.
Appeal from the
Circuit Court of
Cook County



Honorable
Sidney A. Jones III,
Judge Presiding.

JUSTICE DAVID CERDA delivered the opinion of the court:

The issue on appeal is whether a non-English-speakingdefendant failed to participate in good faith and in a meaningfulmanner at a mandatory-arbitration hearing and violated the noticeto appear by failing to provide a foreign-language interpreter soshe could testify. Defendant, Stella Kazakova, appeals from theorders of the circuit court of Cook County (1) finding that shedid not participate in good faith and in a meaningful manner atthe mandatory-arbitration hearing and that she violated thenotice to appear by not appearing with a foreign-languageinterpreter; (2) sanctioning her by debarring her from rejecting the arbitration award in favor of plaintiff, State Farm InsuranceCompany, as subrogee of Robin Depender; and (3) denying hermotion to vacate the sanction. We reverse.



FACTS

In 1995, plaintiff filed a negligence complaint arising outan automobile collision between the vehicles of Depender anddefendant. Defendant filed an answer, denying the allegations ofnegligence. Defendant also filed a jury demand.

The case was assigned to mandatory arbitration. The hearingwas held on September 4, 1996, but the proceedings were nottranscribed. The arbitrators entered an award finding in favorof plaintiff and awarding damages. The award stated in part:

"We note for the record that defendant personallyappeared pursuant to a proper Rule 237 request but wasunable to testify due to her inability to speak andunderstand English. In addition, we unanimously find thatdefendant failed to participate in the arbitration hearingin good faith for the following reasons: 1) Failed toproduce a witness who was competent to testify; 2) Failed topresent any evidence to counter the evidence presented byplaintiff on the issues of liability and damages; 3) Failedto present any evidence whatsoever in defense of the claim."

Defendant filed a notice of rejection of the arbitrationaward. Plaintiff moved the court to debar defendant fromrejecting the mandatory-arbitration award and to enter judgmenton the award. The motion was based in part on defendant'sfailure to testify at the arbitration hearing due to herinability to speak English, her failure to bring an interpreter,and her failure to introduce any evidence in defense. Plaintiffalso sought sanctions under Supreme Court Rule 137 (155 Ill. 2dR. 137) for filing an answer in bad faith. Defendant opposed themotion, arguing in part that she was not required to bring aninterpreter.

On December 30, 1996, the trial court made a finding that,because defendant "fail[ed] to appear" at the arbitration hearing"prepared to testify," she failed to participate in good faithand in a meaningful manner and violated plaintiff's notice toappear. The trial court barred defendant from rejecting thearbitration award, entered judgment on the award in favor ofplaintiff, struck defendant's rejection of the arbitration award,and denied plaintiff's motion for Supreme Court Rule 137sanctions.

Defendant filed a motion to vacate judgment, which wasdenied.

Defendant appealed.

DISCUSSION

Defendant argues that (1) defendant's failure to speakEnglish was not a failure to participate in good faith and in ameaningful manner and was not a violation of the notice to appearat the arbitration; (2) it was an excessive sanction to debardefendant from rejecting the arbitration award; (3) the actionsof the trial court and the arbitration panel violated equalprotection; and (4) Supreme Court Rule 91(b) (145 Ill. 2d R.91(b)) is unconstitutional. We find that it is not necessary forus to decide the constitutional issues.

Plaintiff has moved to strike portions of defendant's replybrief that make new arguments in alleged violation of SupremeCourt Rule 341(g) (155 Ill. 2d R. 341(g)), which requires thatargument "shall be confined strictly to replying to argumentspresented in the brief of the appellee."

The first portion of plaintiff's reply brief that ischallenged is the argument that plaintiff never intended to havedefendant testify. We strike this argument because it was waivedby being raised for the first time in the reply brief. Sylvesterv. Chicago Park District, 179 Ill. 2d 500, 507, 689 N.E.2d 1119(1997); 155 Ill. 2d R. 341(e)(7).

Plaintiff also has moved to strike the argument in the replybrief that defendant was not required to provide an interpreter,based on West Bend Mutual Insurance Co. v. Herrera, 292 Ill. App.3d 669, 686 N.E.2d 645 (1997), which was cited for the first timein defendant's reply brief. Defendant could not have cited thecase earlier because it was not issued until after her initialbrief was filed. In fact, the case was issued before plaintifffiled its appellee brief, and plaintiff should have cited it tothis court: West Bend deals with a similar issue, and plaintiff'sattorney was aware of its recent issuance because he was theappellate attorney for the insurer in West Bend. We decline tostrike the argument.

The standard of review from sanctions imposed on parties tomandatory-arbitration proceedings is abuse of discretion. E.g.,Williams v. Dorsey, 273 Ill. App. 3d 893, 901, 652 N.E.2d 1286(1995)). But the primary issue on appeal--whether defendant'sfailure to provide an interpreter violated supreme court rules--is a question of law. The standard of review of a question oflaw is de novo. Illinois Life & Health Insurance Guaranty Ass'nv. Boozell, 289 Ill. App. 3d 621, 628, 682 N.E.2d 291 (1997).

The arbitration in this case was scheduled pursuant tosupreme court rules establishing a nonbinding, court-annexedarbitration system to resolve certain civil actions. 134 Ill. 2dRs. 86 through 95; Introductory Comments, at 86. Applicable tomandatory-arbitration hearings is Supreme Court Rule 237, whichprovides that the appearance at the trial of a party may berequired by serving her with a notice. 166 Ill. 2d Rs. 90(g),237.

Supreme Court Rule 90(g) provides as follows:

"The provisions of Rule 237, herein,shall be equally applicable to arbitrationhearings as they are to trials. *** Remediesupon a party's failure to comply with noticepursuant to Rule 237(b) may include an orderdebarring that party from rejecting theaward." 166 Ill. 2d R. 90(g).

Supreme Court Rule 91(b) provides a standard for parties'conduct at the arbitration hearings:

"All parties to the arbitration hearing mustparticipate in the hearing in good faith and in a meaningfulmanner. If a panel of arbitrators unanimously finds that aparty has failed to participate in the hearing in good faithand in a meaningful manner, the panel's finding and factualbasis therefor shall be stated on the award. Such awardshall be prima facie evidence that the party failed toparticipate in the arbitration hearing in good faith and ina meaningful manner and a court, when presented with apetition for sanctions or remedy therefor, may ordersanctions as provided in Rule 219(c), including, but notlimited to, an order debarring that party from rejecting theaward, and costs and attorney fees incurred for thearbitration hearing and in the prosecution of the petitionfor sanctions, against that party." 145 Ill. 2d R. 91(b).

A party can reject the arbitration award and proceed to trial. 174 Ill. 2d R. 93(a).

In West Bend, 292 Ill. App. 3d 669, 686 N.E.2d 645, thearbitrators did not make a finding that defendants' failure toprovide an interpreter at the hearing was bad faith, but thetrial court found so. The appellate court found that, standingalone, the facts that a defendant could not speak English and didnot appear at the hearing with a translator did not constitutefailure to participate in the hearing in good faith and in ameaningful manner. West Bend, 292 Ill. App. 3d at 674. But theappellate court nevertheless left open the possibility thatfailure to provide a translator could constitute bad faithbecause it stated that, if plaintiff believed that the failure toprovide a translator constituted bad faith, plaintiff should haverequested that the arbitration panel make findings on the issue. West Bend, 292 Ill. App. 3d at 674.

In our case, the arbitration panel did make such a finding. Although the award stated as one of several reasons for its bad-faith finding that defendant failed to produce a witness, weinterpret the arbitrators' finding of bad faith as being basedprimarily on defendant's inability to testify in English. In anyevent, we are reviewing the trial court's ruling, which was basedsolely on defendant's failure to testify.

The express concerns behind Supreme Court Rule 91(b) are toprevent the abuse of the arbitration process and to uphold theintegrity of the arbitration process. 145 Ill. 2d R. 91(b),Committee Comments, at lxx. Defendant did not choose not toparticipate; she was not able to participate without aninterpreter. In order to meet the standard of good-faith andmeaningful participation, a defendant does not have to hire aninterpreter to assist plaintiff's efforts to prove its case. Ifa defendant does not provide an interpreter and a plaintiffdesires to examine defendant as an adverse witness, plaintiffshould bear the cost of an interpreter. We hold that defendantdid not violate Supreme Court Rule 91(b) by not providing aninterpreter.

We also find that West Bend, 292 Ill. App. 3d 669, 686N.E.2d 645, was clear that the failure to provide an interpreteris not a violation of Supreme Court Rule 237. The rule requiresdefendant to appear, and that is what defendant did.

If a defendant does not notify plaintiff that defendant willnot be able to testify in English and that defendant will notprovide an interpreter at the arbitration hearing, plaintiffwould not be made aware of the need to arrange its owninterpreter to be present, if desired. Certainly that lack ofnotification would be a breach of civility; it might besuccessfully argued in a future case that such conduct also couldform the basis for Supreme Court Rule 91(b) sanctions. We do notknow on this record if plaintiff was aware prior to the hearingof defendant's inability to testify in English. We do not decidetoday whether the failure to notify would violate Supreme CourtRule 91(b).

Even if we held that defendant should have provided aninterpreter as part of her good-faith and meaningfulparticipation in arbitration, we would reverse on the basis thatdebarring defendant from rejecting the arbitration award washarsh and unjustified. The arbitration proceedings could havebeen stayed until defendant provided an interpreter, andplaintiff could have been awarded attorney fees and costsincurred for the arbitration hearing. 145 Ill. 2d R. 91(b); see166 Ill. 2d R. 219(c)(i) (one possible remedy is to stay furtherproceedings until the party complies with the supreme courtrule).

In addition, we believe that the standard to be applied indeciding whether to bar defendant from rejecting the award iswhether her conduct was characterized by a deliberate andpronounced disregard for rules and the court. Walton v.Throgmorton, 273 Ill. App. 3d 353, 359, 652 N.E.2d 803 (1995);Valdivia v. Chicago & North Western Transportation Co., 87 Ill.App. 3d 1123, 1125, 409 N.E.2d 457 (1980). Defendant was presentand available to testify at the arbitration hearing. She couldhave been examined by plaintiff if a Russian-language interpreterhad been present.

We are in accord with the holdings in Smith v. Johnson, 278Ill. App. 3d 387, 662 N.E.2d 531 (1996), Williams v. Dorsey, 273Ill. App. 3d 893, 652 N.E.2d 1286 (1995), and Martinez v.Gaimari, 271 Ill. App. 3d 879, 649 N.E.2d 94 (1995). These casesheld that it is within a trial court's authority to sanction aparty who abuses the arbitration process by failing to appear bydebarring that party from rejecting an arbitration award.



As defendant did not violate Supreme Court Rule 91(b) or237, the trial court erred in barring her from rejecting thearbitration award.

The judgment of the trial court is reversed, and the causeis remanded with directions to permit defendant to reject

the arbitration award.

Reversed with directions.

CAHILL, P.J., and LEAVITT, J., concur.