Great American Dining, Inc. v. Philadelphia Indemnity Insurance
164 N.H. 612
| N.H. | 2013Background
- DW Ray Commons, LLC owned and leased a building to Webster Place Center, Inc. and required an insurance policy naming DW Ray as an additional insured.
- Webster Place obtained from Philadelphia a CGL policy listing as additional insured any person or organization with liability arising out of ownership, maintenance, or use of the leased premises.
- Dr. James Kenneth Wyly fell from the porch railing, sued DW Ray and Webster Place for damages, and the trial court declared DW Ray an additional insured under Webster Place’s Philadelphia policy.
- Webster Place and DW Ray settled with Wyly and sued GAD for contribution, asserting GAD negligently constructed, installed, and maintained the railing; a jury found GAD 45% at fault.
- GAD filed a declaratory judgment seeking coverage as an additional insured and reimbursement of defense costs, judgment, and fees under RSA 491:22-b.
- The trial court held Provision 2f broad enough to cover any person or organization whose liability arises from ownership, maintenance, or use of the leased premises and that Philadelphia owed a defense and indemnity; on appeal, the court affirmed, focusing on policy language, captions, and interaction of provisions.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is GAD an additional insured under Provision 2f? | GAD falls within 2f as any person or organization liable for ownership/maintenance/use of the premises. | 2f should be read narrowly to cover only managers, landlords, or lessors as implied by the caption. | Provision 2f ambiguous; 2f extends to any person/organization with liability arising from the premises. |
| Should the caption control interpretation of Provision 2f? | Captions may control only when necessary; text governs and 2f is broader than its caption. | Caption 2f should limit meaning to managers/landlords/lessors. | Caption cannot limit the text; policy must be read as a whole and 2f is ambiguous in light of its text. |
| Does the term ‘maintenance’ include GAD’s renovation work on the railing? | Renovation falls within maintenance under 2f’s broad text. | Renovation is distinct from maintenance; 2f may not extend to such activities. | Maintenance, as used in 2f, can encompass renovation; 2f covers GAD's work. |
| Did Philadelphia owe a duty to defend GAD in the Wyly action? | The underlying pleadings alleged maintenance-related fault by GAD; defense duty exists if pleadings could invoke coverage. | Without clear coverage, no duty to defend. | Philadelphia owed a duty to defend GAD. |
| Did Philadelphia owe a duty to indemnify GAD for the verdict and costs? | If coverage exists, indemnity follows the meritorious underlying judgment. | Indemnity depends on actual liability proven; coverage contested. | Philadelphia owed a duty to indemnify based on the record showing potential covered liability and the linkage to the verdict. |
Key Cases Cited
- Concord Gen. Mut. Ins. Co. v. Mitchell, 137 N.H. 680 (1993) (read policy provisions as a whole; captions may not control text)
- Atwood v. Hartford Accident & Indemnity Co., 116 N.H. 636 (1976) (read policy as a whole; avoid misleading phrasing)
- Hanover Ins. Co. v. Grondin, 119 N.H. 394 (1979) (policy language clarity; captions not sole determinant)
- M. Mooney Corp. v. U.S. Fidelity & Guaranty Co., 186 N.H. 463 (1992) (interpret policy language consistent with contract intent)
- Weeks v. St. Paul Fire & Marine Ins. Co., 140 N.H. 641 (1996) (ambiguous policy terms construed in insured’s favor)
- Laconia Rod & Gun Club v. Hartford Accident & Indemnity Co., 123 N.H. 179 (1983) (burden on insurer to prove lack of coverage in declaratory action)