CHICAGO – U.S. Seventh Circuit appellate judges approved two decisions of Chief District Judge Nancy Rosenstengel on June 24, one on the court’s civil side and one on the criminal side.
They affirmed her order for Country Mutual Insurance to pay about $250,000 for defense costs it should have provided, and they affirmed her sentence of 20 years on Fernando Alvarez-Carvajal for his part in a drug racket.
Circuit Judge Joel Flaum delivered both opinions, with different colleagues.
Country Mutual’s case resulted from a crash that injured a truck driver, his partner, and a passenger in an ambulance.
Theodore Berg of Hamel Fire Protection District drove the ambulance for Alhambra-Hamel ambulance service.
Fire protection districts of the two communities created the ambulance service as a joint venture in 1989.
Country Mutual insured the ambulance service on the date of the crash, under a policy that listed the ambulance among vehicles the service owned.
The truck drivers filed separate suits against the ambulance service, Berg, and Hamel Fire as Berg’s employer.
The passenger in the ambulance sued the truck’s owner, who filed a third party complaint against the ambulance service and Hamel Fire.
Continental Western tendered the claims against Hamel Fire to Country Mutual, which didn’t respond.
Continental Western retained the Heyl Royster firm of Edwardsville but soon switched to Mulherin, Rehfeldt and Varchetto of Wheaton.
All the cases settled, and Continental Western paid Hamel Fire’s legal bills.
In 2017, Continental Western sued to recover from Country Mutual.
Country Mutual answered that its policy on the ambulance service didn’t apply because the fire protection districts jointly owned the ambulance.
Continental Western moved for summary judgment that the ambulance service owned the ambulance, and Rosenstengel granted it.
“Country Mutual had a duty to defend Hamel Fire in the underlying lawsuits, including the duty to reimburse Continental for the cost of defending Hamel Fire,” she wrote.
She found evidence in the record that the parties intended for the ambulanceservice to be sole owner.
She found Hamel fire protection district reaped significant benefits from the defense Continental provided.
She also found Hamel Fire was released from each suit and avoided paying significant contributions to settlements.
Country Mutual petitioned for appellate review, and the Seventh Circuit directed Rosenstengel to calculate damages.
She awarded $240,146.18 in fees and costs plus $10,394.72 in prejudgment interest, for a total of $250,540.90.
Country Mutual again petitioned the Seventh Circuit, which granted review but denied relief.
“To begin, the Country Mutual policy designated the service as the ambulance owner,” Flaum wrote.
He wrote that Country Mutual nowhere documented the view that the fire protection districts jointly owned it.
“Essentially, Country Mutual argues that one of its own policies means the exact opposite of what it says,” he wrote.
He found Continental Western’s policy did not list the ambulance among vehicles Hamel fire protection district owned.
Circuit judges Michael Scudder and Thomas Kirsch concurred.
In the criminal case, in 2018, grand jurors charged that Alvarez-Carvajal and five others conspired to distribute methamphetamine and heroin.
Two defendants testified as cooperating witnesses that Alvarez-Carvajal delivered drugs and picked up money.
They said he stored drugs and money at his home.
They said he transferred proceeds through his bank account.
Alvarez-Carvajal testified by interpreter and denied all of it.
Jurors found him guilty but didn’t find he testified falsely.
Investigators in the U.S. Probation Office found he did, and they recommended an enhancement of his sentence for obstructing justice.
They recommended another enhancement for storing meth at his home.
They recommended 30 years.
Alvarez-Carvajal objected, stating that he didn’t distribute meth from his home and that the jury didn’t find him guilty of perjury.
He claimed his sentence should run from 19 years and seven months to 24 years and five months.
Rosenstengel overruled his objections at a hearing but didn’t impose 30 years, finding such a sentence greater than necessary.
“Ten years isn’t sufficient but 20 years is,” she wrote.
Circuit Judge Michael Brennan concurred.
Circuit Judge David Hamilton specially concurred to oppose enhancement of sentences for incidental and collateral uses of a home.
He wrote that occasional and relatively circumscribed activity “cannot convert an otherwise normal home into a drug den or stash house.”