Empire Indemnity Insurance Company v. The Chicago Province of the Society of Jesus
990 N.E.2d 845
Ill. App. Ct.2013Background
- This case concerns whether a Catholic religious order (the Chicago Province of the Society of Jesus) has insurance coverage for claims of minor sexual abuse by a priest.
- Multiple insurers issued policies (FNIC, Empire, RLI, Mt. Hawley, Pennsylvania General) with various exclusions and term limits.
- Underlying lawsuits (John Does 116–130 and John Doe parents) alleged abuse by McGuire, and claimed the Jesuits knew or should have known, and concealed or mishandled allegations.
- The trial court granted summary judgment for several insurers based on the “expected or intended” exclusion or knowledge-based exclusions, and denied/limited coverage for others based on policy terms and_missing policy copies.
- John Doe 117 and parents’ claims raised questions about in-term injuries versus pre-term acts and pastoral counseling coverage.
- On appeal, the court affirmed some insurer determinations, reversed others (notably Pennsylvania General for failure to produce complete policies), and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the expected or intended injury exclusion bar coverage? | Jesuits argue the complaints allege negligence, not necessarily intended injuries. | Insurers contend prior knowledge of abuse makes injuries expected or intended. | Yes; the exclusion applies to injuries the Jesuits should have anticipated from prior knowledge. |
| Did John Does 117 and their parents’ injuries occur during the FNIC term? | Emotional/psychological injuries during the policy period are covered. | Actual abuse occurred before the policy term; only the injury within term may be covered. | Not covered; injuries must be the result of the act, not mere later effects when acts predate the term. |
| Does Condition 1.a (actual knowledge by supervisory personnel) apply to FNIC coverage? | Allegations show actual knowledge existed by supervisory Jesuit officials. | Condition 1.a should bar coverage where knowledge existed. | Yes; actual knowledge by supervisory personnel bars coverage. |
| Did Pennsylvania General owe coverage given lack of complete policy copies? | Jesuits challenge incomplete production and seek full policy terms. | Pennsylvania General satisfied burden with attached forms. | Remanded; reversal of summary judgment; complete policy copies required for determination. |
| Do the John Doe parents’ claims involve pastoral counseling coverage? | Claims may arise from pastoral counseling within Pennsylvania General’s coverage. | Injury arose from sexual abuse, not pastoral counseling. | Remanded for determination; no final ruling on pastoral counseling coverage. |
Key Cases Cited
- Pekin Insurance Co. v. Wilson, 237 Ill. 2d 446 (Ill. 2010) (explicates how to interpret ‘expected or intended’ exclusions and look to full context of allegations)
- Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90 (Ill. 1992) (duty to defend evaluated by comparing underlying complaints to policy coverage)
- Wilkin Insulation Co., 144 Ill. 2d 64 (Ill. 1991) (duty to defend, liberal construction in insured’s favor; minimal threshold for potential coverage)
- Bituminous Casualty Corp. v. Gust K. Newberg Construction Co., 218 Ill. App. 3d 956 (Ill. App. 1st Dist. 1991) (duty to defend; broad interpretation of complaints and policy terms)
- Westfield National Insurance Co. v. Continental Community Bank & Trust Co., 346 Ill. App. 3d 113 (Ill. App. 2003) (insurer’s duties tied to insured’s conduct and foreseeability of injury)