Sinclair Oil Corporation v. Allianz Underwriters Insurance Company , 2015 IL App (5th) 140069 ( 2015 )

2015 IL App (5th) 140069
NOTICE
Opinion filed April 7, 2015. NO. 5-14-0069
Modified upon denial of
rehearing September 24, 2015.
IN THE
APPELLATE COURT OF ILLINOIS
FIFTH DISTRICT
________________________________________________________________________
SINCLAIR OIL CORPORATION, ) Appeal from the
) Circuit Court of
Plaintiff-Appellee, ) Madison County.
)
v. ) No. 08-MR-602
)
ALLIANZ UNDERWRITERS INSURANCE )
COMPANY, f/k/a Allianz Underwriters, Inc., ) Honorable
) Donald M. Flack,
Defendant-Appellant. ) Judge, presiding.
________________________________________________________________________
JUSTICE MOORE delivered the judgment of the court, with opinion.
Justices Chapman and Schwarm concurred in the judgment and opinion.
OPINION
¶1 The defendant, Allianz Underwriters Insurance Company, formerly known as
Allianz Underwriters, Inc. (Allianz), appeals, pursuant to Illinois Supreme Court Rule
304(a) (eff. Feb. 26, 2010), the January 8, 2013, order of the circuit court of Madison
County which granted a partial summary judgment in favor of the plaintiff, Sinclair Oil
Corporation (Sinclair). In said order, the circuit court made a determination that Allianz
breached its duty to defend Sinclair with respect to multiple underlying lawsuits and
claims arising out of alleged environmental contamination of soil and groundwater in
Hartford, as well as cleanup activities and alleged exposure to benzene-containing
1
products as a result of such alleged contamination (the underlying lawsuits). We restate
the issues necessary to resolve this appeal as follows: (1) whether an umbrella insurance
policy issued by Allianz contained a "drop down" provision that required Allianz to
defend Sinclair upon exhaustion of an underlying primary policy issued by the Home
Indemnity Company (the Home policy); (2) whether the underlying policy contained
aggregate limits of $500,000 for bodily injury and property damage; and (3) whether the
information Sinclair provided to Allianz regarding payments under the Home policy and
the nature of the claims set forth in the underlying lawsuits was sufficient to trigger
Allianz's "drop down" duty to defend as a matter of law. For the following reasons, we
affirm in part, reverse in part, and remand for further proceedings not inconsistent with
this opinion.
¶2 FACTS
¶3 1. Undisputed Factual Background
¶4 A review of the record on appeal reveals the following facts, which are not in
dispute. Sinclair owned and operated an oil pipeline near Hartford between 1979 and
1990. During 1981 and 1982, there are four instances on record where the pipeline
leaked or spilled. Sinclair ceased operation of the pipeline in 1984, but some petroleum
remained dormant in the pipeline. When Sinclair evacuated the pipeline in 1990, Sinclair
discovered that more petroleum had leaked from the pipeline during its dormant stage. 1
1
The parties agree that Sinclair's five discrete polluting events contributed to, at
most, a tiny fraction of the contamination in the Hartford area when compared to the
2
¶5 Contamination in and around Hartford prompted multiple lawsuits filed in
Madison County, beginning in 2003, which named Sinclair along with several other
entities associated with pipelines and refineries in the area as defendants (the underlying
lawsuits). The underlying lawsuits include claims for property damage 2 and personal
injury, 3 as well as regulatory matters relating to administrative orders issued by the
United States Environmental Protection Agency and the Illinois Environmental
Protection Agency (EPA) for remediation of the contamination.
¶6 The Allianz insurance policy at issue in this case is a commercial general liability
umbrella policy with policy number AUL 5100556 (the Allianz policy), which was
effective from July 31, 1981, to July 31, 1982. According to the schedule of underlying
contributions of other entities that owned and operated the large oil refineries around
Sinclair's pipeline.
2
Sparks v. Premcor, No. 03-L-1053 (hereinafter Sparks); Abert v. Alberta Energy,
No. 04-L-354 (hereinafter Abert); Bedwell v. Premcor, No. 04-L-342 (hereinafter
Bedwell); Village of Hartford v. Premcor, No. 08-L-637 (hereinafter Village of Hartford);
Hopkins v. Premcor, No. 03-L-1053; and State of Illinois v. Premcor, No. 03-CH-459
(third-party complaint for contribution).
3
Wright v. Apex Oil, No. 05-L-1210; Vostry v. Apex Oil, No. 07-L-1;
Brzostowski v. Atlantic Richfield, No. 07-L-340; Schulte v. Apex Oil, No. 07-L-629;
Jones v. A&E, No. 07-L-323; Smith v. Sinclair, No. 08-L-681; Peters v. Amoco, No. 09-
L-56 (hereinafter Peters); and Johns v. Amoco, No. 09-L-136.
3
insurance appended to the Allianz policy, the primary commercial general liability policy
underlying the Allianz policy was issued by Home and was effective July 31, 1981, to
July 31, 1984. It is the interplay between the Allianz policy, the Home policy, and the
underlying lawsuits that is at issue on appeal.
¶7 2. The Pleadings
¶8 Sinclair initially filed a complaint for a declaratory judgment against Allianz in the
circuit court of Madison County in 2008. However, the operative complaint for purposes
of this appeal is the third amended complaint, filed September 20, 2011. The third
amended complaint sets forth the details of each of the underlying lawsuits. With regard
to the regulatory matters, the complaint alleges that Sinclair entered into an agreement,
dated April 2004, to share the costs of remediating the contamination in and around
Hartford with the other entities that had operated in the area. According to the complaint,
between November 2005 and December 2006, Sinclair made payments pursuant to the
agreement "in excess of $3,696,000." In addition, the complaint alleges that, as of the
date of the complaint, Sinclair has "paid over $3 million" defending itself in the
underlying actions.
¶9 The complaint requests, inter alia, a declaratory judgment that Allianz has a duty
to defend Sinclair with respect to the underlying actions, and that Allianz breached that
duty by failing to defend Sinclair under a reservation of rights or seek a declaratory
judgment with regard to coverage. Further, the complaint seeks a declaration by the
circuit court that, because Allianz breached its duty to defend Sinclair with respect to the
underlying actions, Allianz is estopped from asserting any defenses to coverage, and, as
4
such, is required to indemnify Sinclair for all sums that Sinclair has or will become
legally obligated to pay as a result of the underlying actions. Alternatively, the complaint
seeks a declaration that Allianz is legally obligated to indemnify Sinclair irrespective of
its duty to defend.
¶ 10 Allianz filed a counterclaim for a declaratory judgment that it had no duty to
defend or indemnify Sinclair with regard to the underlying lawsuits, asserting that its
policy contains no such duty. In addition, Allianz asserted several defenses to coverage,
including inadequate notice, failure to make a "definite claim," horizontal exhaustion, and
a pollution exclusion. On October 4, 2011, Sinclair filed a motion for partial summary
judgment, seeking a declaration that Allianz has a duty to defend Sinclair in the
underlying actions and that Allianz breached that duty, resulting in its being estopped
from asserting any defenses to coverage. In reviewing the supporting documentation
appended to the motion for partial summary judgment, we begin by noting that both the
Allianz policy and the Home policy are attached to the motion. 4 We will set forth the
relevant language of each policy in detail below as it becomes necessary to analyze the
issues on appeal.
4
Sinclair's copies of the Allianz and Home policies differ slightly from Allianz's
copies of these policies. However, the provisions that must be interpreted in order to
resolve this appeal are identical in each party's copy, and there is no dispute as to the
wording of these provisions.
5
¶ 11 3. The Wyoming Lawsuits
¶ 12 Our recitation of the facts that can be determined from a review of the remaining
attachments to Sinclair's motion will be presented in order to place those facts in a
chronological perspective, rather than as they were presented to the circuit court. The
affidavit of David Stice, a corporate attorney for Sinclair since 1991, with the exception
of three years beginning in July of 1999, was presented to provide proof that Allianz was
aware that the Home policy had been exhausted by prior settlements Home paid on behalf
of Sinclair for the same policy that is at issue in the case at bar. In the affidavit, Mr. Stice
avers that there were several lawsuits filed against Sinclair and others in the 1990s
concerning "claims of bodily injury and/or property damage allegedly resulting from
prior operations at Sinclair's Wyoming refinery (the Wyoming lawsuits)." 5 According to
Stice's affidavit, one of the Wyoming lawsuits 6 alleged both personal injury and property
damage from exposure to materials from Sinclair's Wyoming refinery, while the other
Wyoming lawsuits alleged property damage only. Through correspondence and phone
calls, Allianz was kept apprised of developments in the Wyoming lawsuits and was
5
Albertson v. Dow Chemical Co., No. 65212 (hereinafter Albertson); People of the
State of Wyoming v. Little America Refining Co., No. 62325 (hereinafter People of
Wyoming); KN Energy, Inc. v. Sinclair Oil Corp., No. 93-CV-0080-B (hereinafter KN
Energy); and United States v. Sinclair Oil Corp., No. C89-0153 (hereinafter U.S. v.
Sinclair).
6
Albertson, No. 65212.
6
invited to participate in settlement discussions, but declined. Stice's affidavit sets forth
the details of Sinclair's settlement of each of the Wyoming lawsuits 7 and states that legal
defense costs and fees for the Wyoming lawsuits exceeded $5 million.
¶ 13 The record contains intermittent correspondence between Sinclair and Allianz
regarding the Wyoming lawsuits. In letters from Allianz to Sinclair dated March 28,
1991, August 13, 1991, and August 29, 1991, Allianz admitted that the Wyoming
lawsuits implicated three Allianz policies, including the Allianz policy at issue in this
case, effective July 31, 1981, to July 31, 1982. In these letters, Allianz states its position
with regard to the Wyoming lawsuits, that the Allianz policy at issue is an excess policy,
requiring exhaustion of all underlying policy limits, and that, in any case, the Allianz
policy at issue contains a pollution exclusion. On March 23, 1992, Allianz sent Sinclair a
letter opting not to participate in a declaratory judgment action Sinclair was preparing to
commence against other insurance companies that had issued commercial liability
policies to Sinclair that were potentially implicated by the Wyoming lawsuits.
¶ 14 On April 17, 1996, Sinclair sent a letter to Allianz enclosing "a copy of page 3 of
the Settlement Agreement" between Home and Sinclair resolving coverage of the
Wyoming lawsuits, "confirm[ing] that Home paid $3.5 million in total to Sinclair and the
7
According to Stice, Sinclair settled Albertson for $5.25 million and settled KN
Energy for $1 million, plus certain benefits valued at $1.25 million. Sinclair settled
People of Wyoming and U.S. v. Sinclair by agreeing to perform corrective action near the
Wyoming refinery and spent approximately $6 million performing said corrective action.
7
allocation by policy of the $3.5 million." According to the enclosed excerpt from that
settlement agreement, Home and Sinclair agreed to allocate $500,000 of the settlement to
the underlying Home policy at issue for the 1981-1982 policy period. All of the
$500,000 was allocated to claims for property damage. The settlement agreement
specifically shows that none of the $500,000 was allocated to claims for bodily injury.
¶ 15 The record contains a copy of the full settlement agreement entered into by Home
and Sinclair in order to resolve coverage disputes over the Wyoming lawsuits. However,
there is no indication as to whether or when the full settlement agreement was provided
to Allianz. The "Settlement Agreement" states that Sinclair "owns and operates" a
refinery in or near Evansville, Wyoming, and that disagreements have arisen between
Sinclair and Home as to the application, if any, of the Home policy to insurance claims
"arising out of alleged pollution or contamination at and emanating from the Refinery."
The "Settlement Agreement" states that "demands have been made on Sinclair by ***
government regulatory agencies *** as well as individuals and non-governmental entities
*** in connection with alleged contamination of soil, groundwater and air at and
emanating from the Refinery." However, the "Settlement Agreement" does not delineate
whether all of the claims were for property damage or if any of them were for bodily
injury.
¶ 16 In a largely redacted letter dated August 9, 1996, from Sinclair to Allianz, counsel
for Sinclair states as follows:
"[W]e have provided you with specific evidence from the Settlement Agreement
between Home and Sinclair demonstrating that the property damage limits were
8
paid by Home for the 7/31/81-82 policy year. Accordingly, exhaustion of the
Home policy underlying Allianz has occurred. You indicate that you need
additional information concerning 'the nature of the claims that have been paid,
and how settlement sums have been allocated to the various policy years…' We
do not understand what additional information you are requesting because the
information you are requesting has already been provided to you. We are glad to
entertain a more specific request. For example, during a meeting on January 5,
1996, in which your representatives *** were present, the nature of the claims and
how settlement sums have been allocated to various policy years were discussed in
specific detail. After the meeting, [your representatives] requested additional
information from Sinclair which was provided to them in a letter dated January 11,
1996. Relevant portions of the Settlement Agreement between the primary carrier,
Home Insurance Company and Sinclair Oil we [sic] provided in the January 11,
1996[,] letter and the April 17, 1996[,] letter also references the actions being
settled and how the payments by Home are being allocated.
With respect to damages, we have also previously provided you with a full
breakdown. At this point, we do not understand what additional information you
require. If you can be more specific, please let me know. In the January 5,
1996[,] meeting and in subsequent letters we communicated to Allianz
representatives the following dollar/damages information with extensive backup:
Defense costs………………………$3,656,100
Litigation Liability…………………$10,449,000
9
Future and past cleanup costs……...$14,761,272"
Footnotes in the letter contain further breakdown of Sinclair's projected liability in the
Wyoming lawsuits. According to the footnotes, Sinclair paid $5,250,000 "as settlement
in the toxic tort case of Albertson." The other figures are noted to be projections of
defense, settlement, and remediation costs in the remaining Wyoming lawsuits.
¶ 17 Other than the statements contained in the above-mentioned letters, the record
contains no affidavit or other evidence indicating what information was provided to
Allianz or any other specific details of the Wyoming lawsuits. In addition, the record
contains no evidence showing a breakdown of payments made by Sinclair with respect to
bodily injury versus property damage claims stemming from the Wyoming lawsuits. In a
partially redacted letter dated October 29, 1996, from Allianz to Sinclair, counsel for
Allianz stated, "Allianz does not necessarily agree with your analysis that the limits
underlying the Allianz policy for the 1981-1982 term have been exhausted. We also do
not necessarily agree with Home's position that their defense obligation has been relieved
by their settlement."
¶ 18 4. The Underlying Lawsuits
¶ 19 We next set forth the evidence presented in Sinclair's motion for partial summary
judgment which references the nature and status of the claims arising from the underlying
lawsuits that were instituted as a result of the Hartford contamination. First, Sinclair
attached the affidavit of its attorney, Joseph G. Nassif, who averred that Sinclair has
provided "many updates" to Allianz regarding negotiations with other responsible parties
and the EPA and "requested that Allianz pay the costs of Sinclair's participation." Mr.
10
Nassif also attested to Sinclair's legal fees of "over 3 million" in the underlying lawsuits
and provided an evidentiary foundation for numerous letters and emails between the
parties that were also attached to the motion. Finally, Mr. Nassif's affidavit directed the
circuit court to a website that corroborated the fact that the underlying primary carrier,
Home, was liquidated in 2003 and is insolvent. An order of liquidation for Home dated
June 11, 2003, is also contained in the record.
¶ 20 A review of the correspondence attached to the motion for partial summary
judgment reveals that much of the communications contained therein are redacted.
However, what follows are details that can be gleaned from these communications. On
December 2, 2005, Sinclair sent a letter to AON Natural Resources Risk Services (AON)
which provided information in relation to its pipeline leaks in Hartford. According to the
letter, the EPA ordered many of the other entities affiliated with the contamination to take
emergency response actions which commenced "as early as the Fall of 2003." Sinclair
was added as a participant in the cleanup as of November 18, 2005. At the time of the
letter, it appears there were two property damage lawsuits on file naming Sinclair as a
defendant, one which was styled as a class action and one that was filed by a group of
individuals, but not in class action form. However, from the letter itself, one is not able
to discern to which specific lawsuits the letter is referring.
¶ 21 On January 11, 2006, AON, on behalf of Sinclair, sent out a "Notice of
Loss/Claim" to approximately 30 insurance companies, including Home and Allianz,
11
listing five of the underlying lawsuits 8 and stating that "these claims give rise to coverage
under one or more of the insurance policies on the attached list" and purporting to be
"notice in accordance with the notice terms of each policy." The letter states that a
compact disc is enclosed containing copies of the complaints in Sparks, Bedwell, and
Abert, as well as the EPA administrative order and a document explaining the status of
the litigation in Village of Hartford. According to the letter, a review of these documents
shows that Sinclair has been named as a defendant in lawsuits by owners of property in
Hartford who allege Sinclair contributed to cause a toxic plume which allegedly consists
of an estimated four million gallons of petroleum and/or petroleum byproducts which lie
beneath their property, and that said plume has caused property damage and bodily injury
to persons living in Hartford.
¶ 22 The remaining correspondence between the parties that is contained in the record
took place between 2008 and 2010, between the time this action for declaratory judgment
and the motion for partial summary judgment were filed. On November 12, 2008,
Sinclair stated in a letter to Allianz that "[b]ased on the potential monetary exposure
facing Sinclair and the money expended thus far, Allianz *** should step in and provide
Sinclair the coverage afforded under the excess polic[y] identified in the enclosed
complaint." On March 17, 2009, Sinclair stated in a letter that Allianz's umbrella
coverage is triggered because the underlying Home policy was exhausted through
8
Sparks, Bedwell, Abert, Village of Hartford, and EPA lawsuits; see footnote 2 for
full names and case numbers.
12
payment of the policy limits, and enclosed a copy of the "Settlement Agreement"
between Home and Sinclair in the Wyoming lawsuits. The letter states, "To date, no
carrier has paid any amounts to or on behalf of Sinclair in connection with the underlying
actions."
¶ 23 A March 25, 2009, letter from Sinclair to Allianz attaches the complaint in the
Peters case and states that the complaint concerns the plaintiff's alleged workplace
exposure to benzene. The letter states, "On behalf of Sinclair, we request defense and
indemnification in the Peters case." A May 13, 2009, largely redacted email from
Sinclair states, "We will provide what we believe to be consistent with our client's
demand for coverage." On June 10, 2009, Sinclair provided Allianz with a report on
settlement discussions with the Village of Hartford "[i]n our continuing effort to keep
your clients informed of, and seek their participation in, settlement discussions with the
underlying claimants."
¶ 24 On November 11, 2009, Sinclair states, "We continue to request Allianz' *** full
participation in defense and indemnification in the Wright case and, therefore, ask that
you advise us as soon as possible of your client's position towards potential settlement."
On May 7, 2010, Sinclair stated in a letter to Allianz, "It is particularly egregious that
Allianz continues to refuse to pay Sinclair's defense costs, despite the fact that Sinclair
has provided Allianz with clear evidence demonstrating that all coverage underlying the
policy has been exhausted." (Emphasis in original.) On August 18, 2010, Sinclair asked,
"[G]iven all the information we have provided to Allianz about the underlying actions as
well as documents establishing Allianz' insurance obligations, what is Allianz' basis for
13
not defending?"
¶ 25 5. Proceedings and Orders of the Circuit Court and on Appeal
¶ 26 After full briefing by the parties, oral argument on Sinclair's motion for partial
summary judgment was held in the circuit court, the Honorable Barbara J. Crowder
presiding, on July 31, 2012. During argument, counsel for Sinclair represented to Judge
Crowder that both the property damage and bodily injury aggregate limits of the Home
policy were exhausted by virtue of the Wyoming lawsuits. According to Sinclair's
counsel, the property damage limits were paid by Home and the bodily injury limits were
paid by Sinclair. Counsel for Allianz indicated that Sinclair sought coverage for the
underlying lawsuits from Home up to the point of its insolvency in 2003. Judge Crowder
took the motion under advisement, and on January 8, 2013, entered a detailed order that,
inter alia, partially granted Sinclair's motion for summary judgment, as further detailed
below.
¶ 27 First, Judge Crowder found that Allianz had a duty to defend Sinclair in the
underlying actions pursuant to a "drop down" provision in its policy once the Home
policy limits were exhausted so long as the claims bring the underlying actions within the
coverage of the policy, and that the "claims listed" by Sinclair were for bodily injury and
property and fall within the definition of "occurrence" found in the Home policy. Judge
Crowder defined the second issue as "whether Sinclair established that the underlying
Home [p]olicy was exhausted, or at least that it advised Allianz that Sinclair thought the
Home policy was exhausted." Judge Crowder then found that the aggregate limits of the
Home policy were $500,000 for each type of liability, reasoning that "these limits are
14
clearly stated on the Schedule of Coverage and on the Certificate of Insurance for the
Home policy."
¶ 28 With regard to exhaustion, Judge Crowder determined that the payment by Home
pursuant to the settlement of the Wyoming lawsuits exhausted the property damage limits
of the underlying Home policy. Judge Crowder then recognized Sinclair's claim during
oral argument that it made payments in settlement of the Wyoming lawsuits that
exhausted the bodily injury limits of the policy. According to Judge Crowder, "[e]ven if
there was a question concerning the exhaustion of the bodily injury limits, Sinclair's
alerting Allianz to the possibility of exhaustion advised Allianz of the need to take action
or to be prepared to fulfill its duty for claims covering the 1981-82 policy period."
¶ 29 As to the duty to defend, Judge Crowder found that when Sinclair first provided
Allianz notice of the underlying lawsuits in January 2006, Allianz was required to offer a
defense, make a reservation of rights, or file a declaratory judgment. Because it took
none of these actions, Judge Crowder determined that, "[a]t a minimum," Allianz is liable
to pay Sinclair's defense costs and reasonable attorney fees in the underlying actions after
the date Sinclair provided notice in January 2006. Judge Crowder declined to grant a
request for fees incurred prior to that date "at this time." Finally, although Judge
Crowder found that Allianz "inexorably" breached its duty to defend, she stated that she
was not convinced that the law requires Allianz to be estopped from raising coverage
15
defenses, and reserved ruling on that issue pending further briefing by the parties. 9
Judge Crowder ordered Allianz to pay Sinclair's past legal fees and defense costs for all
of the underlying actions incurred after January 11, 2006, and to reimburse Sinclair's
ongoing legal fees and defense costs on a timely basis for those underlying actions that
have not yet been resolved.
¶ 30 On February 8, 2013, Allianz filed a motion to reconsider the circuit court's order.
The circuit court, the Honorable Donald Flack presiding, entered an order on July 19,
2013, denying the motion to reconsider. On January 24, 2014, the parties filed a joint
motion for a finding, pursuant to Illinois Supreme Court Rule 304(a) (eff. Feb. 26, 2010),
that there is no just reason for delaying either enforcement or appeal of the January 8,
2013, order granting, in part, Sinclair's motion for a partial summary judgment. The
parties also requested a stay of the proceedings pending the outcome of the appeal. Judge
Flack granted that motion on January 24, 2014, and Allianz filed a timely notice of
appeal on February 18, 2014.
¶ 31 On April 7, 2015, this court issued its original opinion resolving the issues on
appeal. On April 30, 2015, Allianz filed a petition for rehearing. After full briefing by
both parties regarding the issues raised in the petition for rehearing, we now issue this
9
It is important to note that this court declines to deliver an advisory opinion as to
this issue, as it was reserved by the circuit court, and therefore not within the scope of our
review. See People v. Dunmore, 2013 IL App (1st) 121170, ¶ 12 (appellate court will not
render an advisory opinion (citing People v. Campa, 217 Ill. 2d 243, 269 (2005))).
16
modified opinion upon denial of rehearing.
¶ 32 ANALYSIS
¶ 33 1. Standard of Review
¶ 34 Because this is an appeal from an order granting, in part, a motion for partial
summary judgment, our standard of review is de novo. Outboard Marine Corp. v.
Liberty Mutual Insurance Co., 154 Ill. 2d 90, 102 (1992). A circuit court should only
grant a motion for summary judgment when there are no genuine issues of material fact
and the moving party is entitled to judgment as a matter of law. Id. Summary judgment
is a drastic remedy and should only be granted when the movant's right to the judgment is
clear and free from doubt. Id. Summary judgment is not appropriate in situations where
a reasonable person could draw different inferences from the facts contained within the
record. Id. With these standards for our review in mind, we move to the first issue
presented by this appeal.
¶ 35 2. Allianz Policy Language Regarding "Drop Down"
¶ 36 The first issue on appeal is whether the Allianz umbrella policy contained a "drop
down" provision which requires it to defend Sinclair in the event the underlying Home
policy is exhausted. 10 Before turning to the policy language at issue, it is important to
note the basic principles we use in interpreting an insurance policy. First, in construing
an insurance policy, it is the job of this court to ascertain the intent of the parties.
10
Allianz conceded this issue at oral argument. However, because the issue was
fully briefed, we will set forth our analysis for the sake of clarity.
17
Outboard Marine Corp., 154 Ill. 2d at 108. In order to determine the meaning of the
language of the policy and the intent of the parties, we must read the insurance policy as a
whole, while giving consideration to the type of risk involved, the subject matter that is
insured, and the purposes of the insurance contract. Id. If the language of the policy is
unambiguous, we must give the language its plain and ordinary meaning. Id. It is only if
the words in the policy are susceptible to more than one reasonable interpretation that we
will find the language to be ambiguous and construe them in favor of the insured. Id. at
108-09.
¶ 37 The provisions of the Allianz umbrella policy that must be construed in order to
determine whether Allianz had a "drop down" duty to defend Sinclair upon exhaustion of
the limits of the underlying Home policy are as follows. The Allianz umbrella policy,
under the heading "Insuring Agreements," section I, entitled "Coverage," states that "[t]he
Company hereby agrees, subject to the limitations, terms and conditions hereinafter
mentioned, to indemnify the Insured for all sums which the Insured shall be obligated to
pay by the reason of the liability *** for damages on account of: A. Personal Injuries; B.
Property Damage; C. Advertising Liability." In section II, entitled "Limits of
Liability−Retained Limit," the Allianz policy provides as follows:
"In the event of *** exhaustion of the aggregate limits of liability
applicable to the underlying insurance (listed in the Schedule of Underlying
Insurance hereof) by reasons of losses paid thereunder, this policy shall, subject to
the terms and conditions of the underlying insurance,
***
18
(b) in the event of exhaustion continue in force as underlying
insurance."
¶ 38 In addition, an amendatory endorsement to the policy, entitled "ASSISTANCE
AND COOPERATION," states:
"EXCEPT AS PROVIDED IN INSURING AGREEMENT II WITH RESPECT TO
THE EXHAUSTION OF THE AGGREGATE LIMITS OF UNDERLYING
POLICIES LISTED IN THE SCHEDULE OF UNDERLYING INSURANCE, THE
COMPANY WILL NOT BE CALLED UPON TO ASSUME THE
SETTLEMENT OR DEFENSE OF ANY CLAIM ***." (Emphasis added.)
¶ 39 Allianz argues that because the "Coverage" provision only contains a promise to
indemnify Sinclair, no duty to defend Sinclair exists in any instance. We agree with the
circuit court that this position is untenable. We must look at the terms of the policy as a
whole, and the plain language of the above-quoted policy provision states that if the
primary insurance in the underlying schedule is exhausted by reasons of payment of
losses, the Allianz policy will, "subject to the terms and conditions of the underlying
insurance, *** continue in force as underlying insurance." The parties do not dispute that
the Home policy was the only comprehensive general liability insurance in the schedule
attached to the Allianz policy, and they do not dispute that the terms of the Home policy
contained a duty to defend. Accordingly, the circuit court was correct in its
determination that there is a drop down provision in the Allianz policy which required
Allianz to defend Sinclair in the event of exhaustion of the aggregate limits of the Home
policy.
19
¶ 40 3. Aggregate Limits of Underlying Home Policy
¶ 41 Having determined that the Allianz policy required Allianz to defend Sinclair with
respect to the underlying lawsuits in the event of exhaustion of the aggregate limits of the
Home policy, we turn to the parties' disagreement on the meaning of the policy schedule
and terms defining aggregate limits. While the circuit court agreed with Sinclair's
position that the aggregate limit for all claims was $500,000, Allianz argues that the
Home policy contains aggregate limits for bodily injury and property damage resulting
from certain types of occurrences, and that the underlying lawsuits do not fall into the
category of claims that contain aggregate limits. For a determination of this issue, we
examine the underlying Home policy.
¶ 42 In examining the underlying Home policy, we must first set forth a description of
the page of the policy entitled "SCHEDULE." A preamble paragraph to a chart
purporting to show "Coverages" and "Limits of Liability" for "Each occurrence" and
"Aggregate," as well as "Description of Hazards," states that "[t]he insurance afforded is
only with respect to such of the following Coverages as are indicated by specific
premium charge or charges. The limit of the company's liability against each such
coverage shall be as stated herein, subject to all the terms of this policy having reference
thereto." (Emphasis added.) The chart provides that, with respect to "Coverage A-
Bodily Injury Liability," the "Limits of Liability" for "each occurrence" is "$500,000,"
and for "aggregate" is "$500,000." With respect to "Coverage B- Property Damage
Liability," the chart also provides that the "Limits of Liability" for "each occurrence" is
"$500,000," and "aggregate" is "$500,000." The "Description of Hazards" showing a
20
premium paid include "Premises-Operations" and "Innkeepers." However, the schedule
notes that "Independent Contractors" and "Completed Operations-Products" are included
in the premium.
¶ 43 Having set forth in detail the information contained within the "Schedule," we
move to the terms of the policy that have "reference thereto." These terms are set forth in
the policy as follows, with our emphasis added as to language that is critical to our
analysis of the issue of the aggregate limits:
"III. LIMITS OF LIABILITY
Regardless of the number of (1) insureds under this policy, (2) persons or
organizations who sustain bodily injury or property damage, or (3) claims made or
suits brought on account of bodily injury or property damage, the company's
liability is limited as follows:
Coverage A- The total liability of the company for all damages, including
damages for care and loss of services, because of bodily injury sustained by one or
more persons as a result of any one occurrence shall not exceed the limits of
liability stated in the schedule as applicable to 'each occurrence.'
Subject to the above provision respecting 'each occurrence,' the total
liability of the company for all damages because of (1) all bodily injury included
within the completed operations hazard and (2) all bodily injury included within
the products hazard shall not exceed the limit of bodily injury liability stated in the
schedule as 'aggregate.'
21
Coverage B- The total liability of the company for all damages because of
all property damage sustained by one or more persons or organizations as the
result of any one occurrence shall not exceed the limit of property damage liability
stated in the schedule as applicable to 'each occurrence.'
Subject to the above provision respecting 'each occurrence,' the total
liability of the company for all damages because of all property damage to which
this coverage applies and described in any of the numbered subparagraphs below
shall not exceed the limit of property damage liability stated in the schedule as
'aggregate.'
(1) all property damage arising out of premises or operations rated on a
remuneration basis or contractor's equipment rated on a receipts basis,
including property damage for which liability is assumed under any incidental
contract relating to such premises or operations, but excluding property
damage included in subparagraph (2) below;
(2) all property damage arising out of and occurring in the course of
operations performed for the named insured by independent contractors and
general supervision thereof by the named insured, including any such property
damage for which liability is assumed under the incidental contract relating to
such operations, but this subparagraph (2) does not include property damage
arising out of maintenance or repairs at premises owned by or rented to the
named insured or structural alterations at such premises which do not involve
changing the size of or moving buildings or other structures;
22
(3) all property damage included within the products hazard and all
property damage included within the completed operations hazard.
Such aggregate limit shall apply separately to the property damage described in
subparagraphs (1), (2) and (3) above, and under subparagraphs (1) and (2),
separately with respect to each project away from premises owned by or rented to
the named insured.
Coverages A and B- For the purpose of determining the limit of the
company's liability, all bodily injury and property damage arising out of
continuous or repeated exposure to substantially the same general conditions shall
be considered as arising out of one occurrence." (Emphasis added.)
¶ 44 Our reading of the above-quoted language from the Home policy leads us to
conclude that in order to determine how a "per occurrence" limit is identified, as well as
which claims have an "aggregate" limit as stated in the schedule, one must turn to the
explanation of those terms which is contained within the policy itself. The schedule itself
contains this caveat, directing the reader to "the terms of the policy which make reference
thereto." Turning to the terms of the policy, it is clear that the language making reference
to the schedule is intended to set forth the circumstances under which the "per
occurrence" limit applies and the circumstances under which the "aggregate" limit
applies. It is also clear that while the "per occurrence" limit is subject to the same
definition for bodily injury and property damage, the language setting forth the
circumstances under which the "aggregate" limit applies contains substantially different
language. From this differing language, we invariably conclude that only certain types of
23
claims are subject to an aggregate limit under the policy, and that there is a distinction
made between the types of bodily injury claims and the types of property damage claims
that are subject to an aggregate limit. Accordingly, Sinclair is incorrect in its position
that all claims are subject to a $500,000 aggregate limit, and we must further examine the
policy language to determine which types of claims are subject to such a limit.
¶ 45 Under the terms of the Home policy which specify the types of claims that have an
aggregate limit, we first turn to the terms explaining the types of claims for bodily injury,
under "Coverage A," that have aggregate limits. The language explaining the limits of
liability for "Coverage A," which is bodily injury, states that liability for bodily injury
included within the "completed operations hazard" and "products hazard" is not to exceed
the limits set forth in the schedule as "aggregate." "Completed operations hazard" and
"products hazard" have meanings that are specified in the definitions section of the
policy. In contrast, the language explaining the limits of liability for "Coverage B,"
which is property damage, states that "all damages because of all property damage to
which this coverage applies and described in any of the numbered subparagraphs below
shall not exceed the limit of property damage liability stated in the schedule as
'aggregate,' " and that the aggregate limit "shall apply separately to the property damage
described in subparagraphs (1), (2) and (3) above, and under subparagraphs (1) and (2),
separately with respect to each project away from premises owned by or rented to the
named insured."
¶ 46 From a comparison of the provisions governing "aggregate" limits with respect to
bodily injury and property damage, we conclude that the only claims for bodily injury
24
that are subject to an "aggregate" limit are claims arising under the "completed operations
hazard" and "products hazard," as defined in the policy. All other claims for bodily
injury are subject to the "per occurrence" limit. In contrast, it is difficult to ascertain
from the policy language whether all property damage claims are subject to an
"aggregate" limit, with some types of property damage claims having a separate
"aggregate" limit, as enumerated in the subparagraphs, or whether only those types of
property damages claims that are enumerated in the subparagraphs are subject to an
aggregate limit. In either case, in order to determine which "aggregate" limit applies to a
particular claim for property damage, one must determine the type of occurrence from
which the claim for property damages arises.
¶ 47 Based on the foregoing, potential aggregate limits for property damage under the
Home policy can be broken down as follows: (1) property damage arising out of premises
or operations rated on a remuneration basis or contractor's equipment rated on a receipts
basis, with a separate aggregate limit for such damage with respect to each project taking
place away from the insured's premises; (2) property damage occurring in the course of
operations performed by independent contractors, subject to some specified limitations,
with a separate aggregate limit for such damage with respect to each project taking place
away from the insured's premises; and (3) property damage included within the products
hazard and completed operation hazard. We find the policy language ambiguous with
regard to whether all other property damage has an aggregate limit. Nevertheless, the
circuit court erred in its determination that the underlying Home policy contained
aggregate limits of $500,000 for all claims. Instead, the only construction of the Home
25
policy that accounts for all of the policy language and construes the policy as a whole
(see Outboard Marine Corp., 154 Ill. 2d at 108-09) requires a determination of whether
any particular claim is subject to an aggregate limit according to the analysis set forth
above, and as summarized in the following table:
Bodily Bodily Injury arising Bodily Injury arising All other Bodily
Injury: from "Completed from "Products Hazard" Injury claims
Operations Hazard" $500,000 Aggregate subject to "Per
$500,000 Aggregate Limit Occurrence"
Limit Limit Only
Property "Property damage "Property damage Property All other
Damage: arising out of occurring in the course Damage arising Property
premises or of operations performed from Damage
operations rated on a by independent "Completed Ambiguous as
remuneration basis contractors" subject to Operations to Whether
or contractor's limitations specified in Hazard" and $500,000
equipment rated on a subparagraph (2) of "Products Aggregate
receipts basis" section III "Limits of Hazard" Limit Applies
$500,000 Aggregate Liability" $500,000
Limit with a separate $500,000 Aggregate Aggregate Limit
$500,000 Aggregate Limit with a separate
Limit for each $500,000 Aggregate
project taking place Limit for each project
away from insured's taking place away from
premises insured's premises
¶ 48 4. Duty to Defend of Umbrella Carrier Under "Drop Down"
¶ 49 Having made the foregoing analysis of the aggregate limits under the Home
policy, we must decide whether the information Sinclair provided to Allianz regarding
payments under the Home policy, as well as the nature of the claims set forth in the
underlying lawsuits, was sufficient to trigger an excess carrier's "drop down" duty to
defend as a matter of law. In Illinois, the duty to defend is much broader than the duty to
indemnify. Outboard Marine Corp., 154 Ill. 2d at 125. Our courts have held that in
26
order to determine whether an insurer's duty to defend has arisen, the court must compare
the allegations of the underlying complaint to the policy language. Id. If the court
determines, after construing the allegations of the complaint liberally in favor of the
insured, that the allegations fall within, or potentially within, the policy's coverage, the
insurer has a duty to defend the insured against the underlying complaint. Id. As such,
this court has stated as follows:
"When a complaint against an insured alleges facts that bring the action within or
potentially within the scope of insurance policy coverage, the insurer taking the
position that the complaint is not covered by the policy must defend the suit under
a reservation of rights or seek a declaratory judgment that there is no coverage."
Korte Construction Co. v. American States Insurance, 322 Ill. App. 3d 451, 457
(2001) (citing State Farm Fire & Casualty Co. v. Martin, 186 Ill. 2d 367, 371
(1999)).
¶ 50 In addition to the foregoing, this court has held that if an insured tenders to an
insurer the defense of a cause that meets the above-quoted "four corners of the
complaint" rule, and the insurer refuses to participate in the litigation, instead waiting for
the insured to institute litigation against the insurer to determine the insurer's rights and
duties, the insurer is estopped from raising noncoverage as a defense in that litigation. Id.
at 458. However, it is important to note that these rules and standards have been set forth
in cases involving a primary insurer, in which the policy at issue contains a "first dollar"
27
duty to defend. 11 Accordingly, the test that has been set forth by our courts regarding the
duty to defend assumes that the only prerequisite to the duty to defend is "coverage."
Pursuant to this test, we find that Allianz's arguments related to whether a limitation or
exclusion in its policy applies to bar coverage of the underlying lawsuits, including its
arguments regarding timeliness of notice, horizontal exhaustion, the pollution exclusion,
and whether Sinclair made a "definite claim," are the types of coverage questions of
which, if the "drop down" duty to defend were triggered, Allianz was required to seek a
judicial determination. As such, these arguments are irrelevant to our disposition of this
appeal. However, in a case such as this, where the issue concerns an umbrella carrier,
and the duty to defend under the policy is only triggered by the exhaustion of an
underlying policy pursuant to a "drop down" provision, we find that an additional
threshold standard concerning exhaustion should be required before the umbrella insurer
comes under a legal obligation to defend under a reservation of rights or to file a
declaratory judgment action.
¶ 51 In determining an appropriate threshold standard for triggering an umbrella
carrier's duty, under a "drop down" provision, to defend its insured under a reservation of
rights or to file an action for a declaratory judgment, we seek to balance Illinois public
11
Although the policy at issue in Korte had an "other insurance" clause that stated
that " '[t]his insurance is excess over: [a]ny other insurance provided to you on a primary
basis,' " the policy in Korte was not an "umbrella policy," but was a primary policy
containing a first line duty to defend. Korte, 322 Ill. App. 3d at 454.
28
policy, which places the burden on the insurer to have coverage defenses adjudicated,
with the expectations of the parties to an umbrella insurance contract such as the one at
issue here. In so doing, our focus is on the information that must be provided to the
umbrella carrier concerning the exhaustion of the underlying policy limits. We find our
supreme court's decision in Cincinnati Cos. v. West American Insurance Co., 183 Ill. 2d
317 (1998), to be instructive. In that case, the court was called upon to consider whether
an insurer had a duty to defend its insured without a specific request for a defense. Id. at
323-24. The supreme court held that "where the insured has not knowingly decided
against an insurer's involvement, the insurer's duty to defend is triggered by actual notice
of the underlying suit, regardless of the level of the insured's sophistication." Id. at 329.
The court further defined "actual notice" as "notice sufficient to permit the insurer to
locate and defend the lawsuit" (internal quotation marks omitted), in that "the insurer
must know both that a cause of action has been filed and that the complaint falls within or
potentially within the scope of the coverage of one of its policies." Id. at 329-30.
¶ 52 We find that a similar standard is appropriate in order to impose a duty on an
umbrella carrier to defend the insured upon exhaustion of the underlying limits under a
"drop down" provision. Accordingly, we hold that, in order to trigger such a duty to
defend, the umbrella carrier must have "actual notice" of the potential exhaustion of the
aggregate limits of the underlying insurance policy. We find that "actual notice" is notice
sufficient to allow the insurer to make a preliminary determination that the limits of the
underlying insurance policy have potentially been exhausted as to the claim or claims for
which the insured is seeking coverage. The umbrella insurer is entitled to more than an
29
insured's allegation of exhaustion. At a minimum, the insurer must be in possession of
some evidence of actual payments, made by the underlying insurance company or the
insured, that potentially meet or exceed the aggregate limits of the underlying policy that
is applicable to the claim for which the insured is seeking coverage. 12 Once the umbrella
carrier is in possession of such evidence of payments made, the burden is on the insurer
to resolve any potential issues regarding exhaustion. At that point in time, if the
complaint comes within the potential coverage of the excess policy, the umbrella insurer
has a duty to defend the insured. Accordingly, if the umbrella carrier wishes to litigate
the issue of underlying exhaustion or assert any other defense to coverage, it must defend
the insured under a reservation of rights or seek a declaratory judgment. See Korte, 322
Ill. App. 3d at 457 (citing Martin, 186 Ill. 2d at 371).
¶ 53 Having determined the appropriate standard to be employed in this case, we turn
to the record to determine whether summary judgment in favor of Sinclair regarding
Allianz's duty to defend is appropriate at this stage of the proceedings. We note at the
outset that because we have found that the underlying Home policy contains aggregate
12
It is important to emphasize that payments by the insured that exceed the
underlying policy limits are also to be considered exhaustion. To require the payments to
be made out of the primary insurer's coffers would preclude excess coverage under an
umbrella policy when the primary insurer has become insolvent or has wrongfully
withheld payment. See Emhart Industries, Inc. v. Home Insurance Co., 515 F. Supp. 2d
228, 244 (D.R.I. 2007).
30
limits for specific types of claims, and that we must differentiate the types of claims
containing aggregate limits as between bodily injury and property damage, we must
separate our analysis of Allianz's duty to defend accordingly. As such, we will first
determine whether there is evidence in the record to determine, as a matter of law, that
Allianz had some evidence of payments, either by Home or by Sinclair, of the aggregate
limits of the bodily injury coverage of the Home policy so as to trigger Allianz's duty to
defend upon notice of the underlying lawsuits containing claims of bodily injury. 13
Then, we will conduct the same analysis as to the underlying lawsuits containing claims
for property damage.
¶ 54 Having carefully considered the record, it is clear that there is insufficient
evidence, at this stage in the proceedings, to determine whether Allianz had possession of
some evidence of payments, either by Sinclair or by Home, of the $500,000 aggregate
limits of the policy for claims of bodily injury. As set forth above, bodily injury claims
only have an aggregate limit if they are included in the "completed operations hazard" or
"products hazard," as those terms are elsewhere defined in the policy. The parties have
not briefed the issue of whether the bodily injury claims arising from the Wyoming
lawsuits fit within these definitions such that they would even have an aggregate limit. In
13
If it is determined that Allianz did have the duty to defend, there must also be
evidence in the record to determine when the duty was triggered and when it received
"actual notice" of each lawsuit in order to determine those defense costs for which
Allianz is liable.
31
addition, it is clear that the Home settlement covering the Wyoming lawsuits was
allocated to property damage claims only. Further, although there is evidence that
Sinclair made substantial payments of its own to settle the Wyoming lawsuits, there is no
evidence of which payments were made for claims of bodily injury and whether Allianz
was provided evidence of any such payments. Accordingly, there are genuine issues of
material fact that must be resolved in order to determine whether the Wyoming lawsuits
exhausted bodily injury limits contained within the underlying Home policy.
¶ 55 Assuming that there was proof in the record that payments made for bodily injury
claims arising from the Wyoming lawsuits concerned the "completed operations hazard"
or "products hazard," in order for Allianz to have a duty to defend bodily injury claims
out of the underlying lawsuits in Hartford, the oil spill leaks would have to also have
arisen from the "completed operations hazard" or "products hazard." Otherwise, under
the terms of the Home policy, bodily injury claims are subject only to a "per occurrence"
limit. Again, the parties have not briefed the issue of whether the bodily injury claims
arising from the underlying lawsuit fell within these definitions such that they were
subject to an aggregate limit. The only way in which there can be a finding that Allianz
breached its duty to defend Sinclair with regard to the bodily injury claims is if Sinclair
can prove that the bodily injury claims arising from the Wyoming lawsuits and the
underlying lawsuits were subject to an aggregate limit under the Home policy, and that
Allianz had possession of some evidence of payments made by either Sinclair or Home of
32
$500,000 or more. 14 There is insufficient evidence in the record to make these findings at
this time.
¶ 56 The facts in the record are much different with regard to the claims for property
damage. Under our interpretation of the underlying Home policy, the issue of whether all
property damage claims are subject to the $500,000 aggregate limit requires the
resolution of an ambiguity in the underlying Home policy language. What is clear is that
some property damage claims have separate aggregate limits, as set forth above. The
parties do not dispute that Home made a $500,000 payment in settlement of its coverage
dispute with Sinclair over the Wyoming lawsuits, and specifically allocated that entire
amount to claims of property damage. The record shows that Sinclair sent Allianz some
evidence of this payment in the form of the settlement agreement in 1996, claiming that
14
We note that there is evidence in the record that Sinclair has expended over $3
million to defend the underlying lawsuits. Under the standards set forth in this opinion,
Allianz would be required to defend Sinclair once it had possession of some evidence that
Sinclair's payments on bodily injury claims exceeded the $500,000 "per occurrence limit"
of the underlying policy. However, it is unclear from the record as to what part of
Sinclair's payments have been for bodily injury claims, whether said payments exceed
$500,000, and if so, whether Allianz had some evidence of said payments in its
possession prior to filing its counterclaim for a declaratory judgment. If all of these
conditions were met, a breach of the duty to defend would have occurred within a
reasonable time after the information came into Allianz's possession.
33
the underlying limits had been exhausted. Allianz does not dispute that it was in
possession of this information. Accordingly, when Allianz received "actual notice" of the
underlying lawsuits, which included claims for property damage, the questions that
needed to be answered in order to ascertain exhaustion were whether the underlying
lawsuits fell within one of the categories of claims listed in the Home policy as having a
separate aggregate limit, and, if not, whether the Home policy language should be
interpreted to provide for an aggregate limit for all other property damage claims. We
find that this amounts to evidence of payments that potentially exhausted the underlying
insurance. We find that when there is an ambiguity in the underlying policy regarding
categories of aggregate limits, the burden is on the insurer to resolve that ambiguity, as
the umbrella carrier is in the best position to resolve the ambiguity in the underlying
policy prior to issuing an umbrella policy dependent on exhaustion of the underlying
aggregates. If the ambiguity as to the aggregate limits remains, as in the case at bar, once
an issue of exhaustion is raised by evidence of payments of the aggregate amount, the
burden is on the insurer to defend under a reservation of rights or filing a declaratory
judgment action.
¶ 57 Here, despite having possession of evidence of payments of $500,000 for property
damage, Allianz did nothing to resolve any issues remaining regarding exhaustion of the
underlying policy limits. Allianz did not seek information to enable it to determine
which category of claims the Wyoming lawsuits and the Hartford lawsuits would be
considered as under the Home policy, and it did not seek a judicial determination of the
ambiguity regarding property damage aggregates in the Home policy. Accordingly, we
34
find that Allianz breached its duty to defend Sinclair with regard to the property damage
claims arising out of the underlying lawsuits. 15 Thus, the circuit court was correct in
finding that Allianz was liable for defense costs from the time it received actual notice of
the lawsuits in 2006, but only those defense costs related to the claims for property
damage.
¶ 58 CONCLUSION
¶ 59 In conclusion, and for the foregoing reasons, we find that the circuit court erred
when it found adequate evidence in the record to prove, as a matter of law, that Allianz
breached its duty to defend Sinclair on any claims for bodily injury arising from the
underlying lawsuits. However, for the reasons stated herein, we affirm the circuit court's
determination that Allianz breached its duty to defend Sinclair with respect to the
property damage claims, and as such, is liable for defense costs Sinclair has incurred
defending the property damage claims from the time it gave Allianz notice of said claims
in 2006. Accordingly, we affirm in part, reverse in part, and remand for further
proceedings not inconsistent with this opinion, in which the circuit court, inter alia,
determines the amount of attorney fees attributable to the property damage claims in the
15
The circuit court reserved ruling on whether Allianz would be estopped from
asserting policy defenses to coverage by virtue of its breach of the duty to defend. As set
forth in footnote 9, we decline to set forth an advisory opinion on this issue. See People
v. Dunmore, 2013 IL App (1st) 121170, ¶ 12 (appellate court will not render an advisory
opinion (citing People v. Campa, 217 Ill. 2d 243, 269 (2005))).
35
underlying actions, and makes a determination, after further development of the record
based on the analysis set forth above, regarding Allianz's duty to defend Sinclair with
regard to the bodily injury claims.
¶ 60 Affirmed in part and reversed in part; cause remanded.
36
2015 IL App (5th) 140069
NO. 5-14-0069
IN THE
APPELLATE COURT OF ILLINOIS
FIFTH DISTRICT
SINCLAIR OIL CORPORATION, ) Appeal from the
) Circuit Court of
Plaintiff-Appellee, ) Madison County.
)
v. ) No. 08-MR-602
)
ALLIANZ UNDERWRITERS INSURANCE )
COMPANY, f/k/a Allianz Underwriters, Inc., ) Honorable
) Donald M. Flack,
Defendant-Appellant. ) Judge, presiding.
______________________________________________________________________________
Opinion Filed: April 7, 2015
Modified Upon Denial of Rehearing: September 24, 2015
______________________________________________________________________________
Justices: Honorable James R. Moore, J.
Honorable Melissa A. Chapman, J., and
Honorable S. Gene Schwarm, J.,
Concur
______________________________________________________________________________
Attorneys Kristi S. Nolley, David M. Alt, BatesCarey LLP, 191 North Wacker
for Drive, Suite 2400, Chicago, IL 60606; Daniel L. Bradley, DeFranco
Appellant & Bradley, P.C., 141 Market Place, Suite 104, Fairview Heights, IL 62208
______________________________________________________________________________
Attorneys Bernard Y. Ysursa, Cook, Ysursa, Bartholomew, Brauer & Shevlin, Ltd.,
for 12 West Lincoln Street, Belleville, IL 62220; Joseph G. Nassif, Ron
Appellee Hobbs, Husch Blackwell LLP, 190 Carondelet Plaza, Suite 600,
St. Louis, MO 63105
______________________________________________________________________________