2019 IL App (2d) 180154
Ill. App. Ct.2019Background
- Multi-vehicle collision (Sept. 11, 2015) at an uncontrolled intersection: James Hollander (driver) died; Sandra Wendland (owner of the 2015 Nissan) and Alyssa Guarino were passengers; Cheyenne Flowers and a tractor-trailer driven by Keith Keigher were other parties.
- Wendland’s umbrella policy (issued by State Farm) provided $1 million Coverage L (personal liability) and defined “insured” to include, among others, “any other person or organization to the extent they are liable for the use of an automobile, recreational motor vehicle or watercraft by a person included in 6.a.”
- Underlying plaintiffs (Wendland, Sheppard, Flowers) sued Hollander’s estate for negligence; none alleged Hollander was vicariously liable for Wendland or that Wendland was negligent.
- State Farm defended Hollander’s estate under Wendland’s primary policy but sought a declaratory judgment that the umbrella policy did not obligate it to defend or indemnify Hollander’s estate.
- Trial court initially denied summary judgment for State Farm, then granted it on reconsideration, holding Hollander was not an “insured” under the umbrella policy. Appeal followed and was consolidated.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Hollander qualifies as an “insured” under paragraph 6.c of Wendland’s umbrella policy | The policy requires the insured to be "liable for the use ... by [the named insured]"; underlying complaints do not allege Hollander was liable for Wendland’s use, so no coverage | Paragraph 6.c is ambiguous or should be read (via last-antecedent rule) to cover any person liable for use of an automobile (or to treat passenger-related "use" as within scope); passenger/"use" language can include Hollander | Court: Policy unambiguous; coverage requires that the claimant allege the putative insured was liable for the named insured’s use. No such allegation here; Hollander is not an insured and State Farm has no duty to defend/indemnify. |
Key Cases Cited
- Home Insurance Co. v. Cincinnati Insurance Co., 213 Ill. 2d 307 (standards for de novo review of summary judgment in insurance coverage context)
- Pekin Insurance Co. v. Wilson, 237 Ill. 2d 446 (duty to defend is determined by comparing underlying complaint to policy language)
- Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90 (contract interpretation principles for insurance policies)
- Travelers Insurance Co. v. Eljer Manufacturing, Inc., 197 Ill. 2d 278 (plain-meaning rule for unambiguous policy language)
- Nicor, Inc. v. Associated Electric & Gas Insurance Services Ltd., 223 Ill. 2d 407 (undefined terms are not automatically ambiguous; ambiguities construed against insurer)
- Hobbs v. Hartford Insurance Co. of the Midwest, 214 Ill. 2d 11 (ambiguity requires more than one reasonable interpretation)
- McKinney v. Allstate Insurance Co., 188 Ill. 2d 493 (courts will not strain to find ambiguity)
- Central Illinois Light Co. v. Home Insurance Co., 213 Ill. 2d 141 (avoid treating contract language as surplusage)