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In Sandlin v. Harrah’s Illinois Corp., 2016 WL 4585932 (App. Ct. Ill. September 2, 2016), the Appellate Court of Illinois (the “Appellate Court”) affirmed a lower court’s grant of Summary Judgment for Cross-Claim Defendant Hnedak Bobo Group, Inc. (“HBG”) dismissing Cross-Claim Plaintiff Harrah’s Illinois Corporation (“Harrah’s) claims for contribution.
In 1999, Harrah’s began construction of a hotel in Joliet, Illinois. HBG served as the architect for the project. Construction was completed in 2000. The contract between Harrah’s and HBG allowed Harrah’s to seek contribution fronm HBG for claims arising from HBC’s negligence or failure to comply with applicable codes.
In July 2004, William Sandlin, husband of Plaintiff Mary Sandlin (“Mrs. Sandlin”), slipped and fell on a wet floor and died from the resulting injuries. Mrs. Sandlin sued Harrah’s and HBG, among others, alleging various theories of liability. Harrah’s filed a cross-claim against HBG seeking contractual contribution pursuant to the contract and statutory contribution pursuant to the Joint Tortfeasor Contribution Act (the “Contribution Act”). During the course of litigation, defendants settled with Mrs. Sandlin and the only remaining claim was Harrah’s cross-claim against HBG. HBG moved for summary judgment on Harrah’s cross-claim based on the good faith settlements of all the parties.
The Appellate Court noted the Contribution Act provides a tortfeasor who enters into a good-faith settlement with a claimant is discharged from all liability for any contribution to any other tortfeasor and may not recover contribution from another tortfeasor whose liability is not extinguished by the settlement. Despite the statutory safeguard, Harrah’s argued the contractual provision allowed for contribution, even if a good faith settlement had occurred.
The Appellate Court found the contribution clause was unenforceable because it violated the Contribution Act. The Court held an independent contractual right to contribution that discourages good faith settlements would be void as against public policy and therefore the contract could not preserve claims that were otherwise barred by the Contribution Act. Because HBG was willing to enter into a good faith settlement with Mrs. Sandlin, Harrah’s claim was extinguished. This holding allows design professionals in Illinois to settle with plaintiffs without having to worry about potential claims for contribution from co-defendants, so long as the settlement was made in good faith.