Case Information
*1 Before P OSNER R IPPLE , K ANNE , Circuit Judges . R IPPLE Circuit Judge
. Scot Vandenberg injured when he fell upper deck yacht anchored Lake Michigan. He filed suit state court, alleging owners operators yacht were negligent. He eventually settled defendants. Under settlement agreement, defendants agreed pay $25 million through assignment their claims against their insurers. Westfield Insurance Company (“Westfield”) was insurance provider for Rose Paving Company (“Rose Paving”), one defendants. Westfield disputed that policies Rose covered yacht accident brought a declaratory judgment action district court. Mr. Vandenberg, as assignee Paving, opposed action. The district granted Westfield’s motion for judgment on pleadings; decided did Mr. Vandenberg’s injury. Mr. Vandenberg asks review determination. We now hold accident occurring yacht covered by accordingly affirm court’s judgment.
I
BACKGROUND A. September Mr. Vandenberg was attending a five ‐
hour cruise a chartered yacht when he fell upper deck. The accident occurred when he turned respond someone calling name and, he shifted his weight, bench upon he was sitting tipped over. The bench was secured deck, nor did upper deck a railing. fall left Vandenberg paralyzed chest down. yacht was owned by RQM, Inc. (“RQM”), closely held corporation owned by Michael Rose, Carl Quanstrom, Alan Rose. alleged Paving, company run Alan Rose, booking agent maintained marketing relationship chartering yacht. *3 3 14 2009
At time accident, Rose Paving was insured by a commercial general liability (“CGL”) policy and by umbrella policy (collectively “the policies”). The application CGL policy listed as insureds Rose Paving Co., Rose Paving Seal Coating Inc., and Bridgeview Investments. [1] This application included “schedule hazards,” which listed “concrete construction,” “Contractors Executive Supervisors,” and “subcontractors.” The application also asked whether applicant owned, hired, or leased watercraft. Rose Paving marked “no” box. The umbrella section application similarly asked whether applicant owned or leased watercraft. Rose did answer question.
The contract included “common policy decla ‐ rations” applicable both CGL and umbrella policies, which listed Paving’s business as “concrete construc ‐ tion.” The CGL policy declarations also contained “gen ‐ eral liability schedule,” listed premises opera ‐ tions covered contract included “contractors” “subcontracted work—in connection construction, re ‐ construction, repair erection buildings.” CGL *4 4 14 ‐ 2009 umbrella further provided Westfield would legally obligated to pay for damages “to which this insur ‐ ance applies.” [6] They then listed certain exclusions, including liability “aris[es] out ownership, maintenance, use or entrustment others any … watercraft owned or op ‐ erated by rented loaned insured.” [7] Finally, provided that, accepting coverage, Paving agreed “[t]he statements in Declarations are accurate complete,” “[t]hose statements are based upon rep ‐ resentations” made Westfield, West ‐ field “issued th[e] in reliance upon [those] representa ‐ tions.” [8]
B.
Before Westfield filed this declaratory action, had commenced several actions, particulars are pertinent our decision today. [9] Vandenberg (…continued)
schedule, applied if had been “obligated pay ‘retained limit’” CGL policy. R.56 ‐ 2 at 25; see also id. at 29 (“‘Retained limit’ means available limits ‘underlying insurance’ scheduled in Declarations … .”). R.56 ‐ at (CGL policy); R.56 ‐ at 13 (umbrella policy). R.56 78; R.56 ‐ at 15. R.56 86; R.56 To summarize briefly, March filed action
against RQM Circuit Cook County, Illinois, seeking recover money damages injuries. August RQM filed maritime action federal seeking exoneration
(continued…) ultimately entered into settlement agreement with defendants, disposing of then pending state court and maritime actions. Under this agreement, Rose Paving, along with Carl Quanstrom, Michael Rose, Alan Rose, Dough Management, and Location Finders International, agreed to pay $25 million, to be satisfied solely through an assignment of their rights of recovery their policies. Paving, Michael Rose, Alan Rose agreed to pay an additional $300,000 directly, RQM’s insurer agreed to pay $2 million. The settlement agreement accepted by Circuit Court Cook County, Illinois, October 2012.
(…continued)
accident or limitation to value yacht. The district court enjoined Mr. Vandenberg from pursuing his claims against RQM ordered refrain from filing additional lawsuits. Mr. Vandenberg then dismissed his first state court action. August Mr. Vandenberg filed second suit Circuit Cook County, Illinois. He alleged defendants were negligent they failed railing other protection top deck, allowed Mr. Vandenberg access top deck yacht, failed warn about lack railings, “[a]llowed bench placed inches rear unrailed top deck.” R.56 The district court overseeing RQM’s maritime action ordered Mr. Vandenberg stay state court action. Vandenberg also provided unfiled amended
complaint five months before settlement. amended complaint included allegations negligently owned, maintained, used unstable bench. stay imposed RQM’s maritime action prevented filing amended complaint. ‐ January Westfield filed this declaratory action. It
sought determination it owed no duty under Rose Paving’s policies defend indemnify any defendants state court action. Westfield alleged policies did cover underlying accident operation seventy five foot yacht fell outside scope risks and liabilities for provided coverage. Alternatively, Westfield maintained “watercraft exclusion” barred Rose Paving’s conduct released Westfield contractual under policies. filed motion for judgment on pleadings.
Mr. Vandenberg, assignee Rose Paving, responded combined response cross motion for summary judgment. The district court granted Westfield’s motion judgment pleadings denied Mr. Vandenberg’s motion summary judgment. The court concluded covered Paving’s business. court relied description provided common declarations, “schedule hazards” listed application, representation did own, hire, lease watercraft. later denied Vandenberg’s motion alter judgment Federal Rule Civil
Procedure 59(a). now appeals court’s decision granting Westfield’s motion judgment on the pleadings.
II
DISCUSSION asks us review district court’s decision scope Westfield policies. He maintains that policies his injuries because broad terms employed text. More precisely, he takes view that, because Westfield do exclude expressly accidents such one yacht, accident injuries are covered. Westfield responds apply and, alternative, accident falls under watercraft exclusion contained policies. interpretation is matter state law. See Koransky, Bouwer Poracky, P.C. Bar Plan Mut. F.3d (7th Cir. 2013). Because agree law applies, we look decisions of the Supreme of Illinois for guidance. See id. We review de novo the district court’s decision granting Rule 12(c) motion judgment pleadings. See Matrix IV, Inc. v. Am. Nat’l Bank Tr. Co. F.3d (7th Cir. 2011). For reasons set out more fully below, agree policies do provide coverage Vandenberg’s accident. We also conclude use of yacht excluded policies’ watercraft exclusion.
A.
We first address scope Westfield insurance policies. makes two major arguments support interpretation policies. First, he submits designation, own, is insufficient limit scope policies. Second, he contends that, Illinois law, insurer must “expressly exclude” risk insurance if insurer does intend insure against particular risk. He therefore maintains do expressly exclude non related injuries, coverage.
Under law, “[a]n insurance contract, general rules governing interpretation other types contracts also govern interpretation policies.” Hobbs Hartford Midwest (Ill. 2005). When interpreting policy, “our primary objective is ascertain and give effect the intention the parties, as expressed the policy language.” ; accord Crum & Forster Managers Corp. v. Resolution Tr. Corp. , N.E.2d (Ill. 1993) (“[T]he primary function court is ascertain and enforce intentions parties as expressed agreement.”). To achieve that goal, we “must construe policy as whole, taking into account type insurance for which contracted, risks undertaken and purchased, subject matter that is insured purposes entire contract.” Crum Forster Managers Corp. N.E.2d 1078; accord Oakley Transp., Inc. Zurich (Ill. App. Ct. 1995) (noting “an insurance is interpreted factual vacuum without regard purpose for which insurance written”).
After reviewing application terms policies, we conclude correctly determined Westfield Rose intended enter into agreement Westfield provided coverage Paving’s ‐ related business. We begin with actual text policies. respect, first note policies’ “common declarations” list “concrete construction.” “general schedule” also explains providing work done “in connection construction, reconstruction, repair 2009 erection of buildings.” The thus reflect, explicitly, parties’ intent to insure business.
The situation before us today closely akin one before Appellate of Illinois Heritage Insurance Co. v. Bucaro , N.E.2d (Ill. App. Ct. 1981). There, court determined similar representations were sufficient limit scope of insurance policy. The court determined underlying insurance policy did cover automobile acquisitions “[t]he activities enumerated policy concern[ed] operations relating automobile dismantling .” Id. at (emphasis original). The court relied description hazards, which “include[d] salvage junking parts, store operations,” listed insured’s “Automobile Dismantling.” Id. 981. “Due limited nature purchased,” concluded “implausible assume protection was expected type has been created here.” Id. 982. court’s methodology conclusion reinforces our view proper interpretation policies. application also supports our
interpretation. See Dash Messenger Serv., Inc. v. Hartford Ins. Co. Ill. N.E.2d (Ill. App. Ct. 1991) (relying application determine risks contracted); see also A.D. Desmond Co. Jackson Nat’l Life (Ill. App. Ct. 1992) ‐ (“When, as in this case, an insurance is issued makes application insurance part policy, application becomes and is construed part entire insurance contract.”). at issue here that Rose Paving agreed that “[t]he statements in Declarations are accurate and complete,” that “[t]hose statements are based upon representations” Rose Paving made Westfield, “issued th[e] in reliance upon [those] representations.” stated in application it engaged in construction business. Consistent representation, parties listed in schedule hazards risks they intended cover, including “concrete construction,” ”Contractors Executive Supervisors,” “subcontractors.” representations in insurance application therefore reinforce our text insurance our conclusion did intend cover an accident occurring on yacht. submits inappropriate rely business designation in insurance contract. We need determine whether, all cases, courts would consider business designation contained policy, standing alone, sufficient indication party intent circumscribe scope agreement. Here, our decision need rely solely designation. As noted earlier, business designation general schedule contained the contract, as well as the incorporated representations the insurance application, express, uniformly , the parties’ intent limit scope of insurance policies Rose Paving’s known business, construction. See Heritage , N.E.2d at 981–82 (holding that, description of hazards included only “Automobile Dismantling” and business insured listed as “Automobile Dismantling,” “it evident provides coverage only for occurrences arising out specified activities [automobile dismantling] taking place insured premises”). correctly recognized “operated multiple independent businesses (paving yacht charters), purchased insurance for only one those businesses (paving), later sought coverage different business (yacht charters).” In this case, therefore, designation contained contract, when read other evidence parties’ intent, substantiates forcefully parties entered into agreement insure business.
Nor can we accept Vandenberg’s contention all liabilities unless they are explicitly excluded. assessing this submission, our task is, course, determine intent parties, expressed policy. See Hobbs N.E.2d 564; Crum Forster Managers Corp. 1078. Here, believe text structure makes clear intended insure against *13 13 No. 14 2009 risks operating a construction company. If parties intended to exclude risk associated with running such a business, we would expect them to have recited that exclusion in contract. A policy does not need to exclude from coverage was not contemplated and not intended to be covered their agreement. See Dash Messenger Serv., Inc. , 1263 (noting an insurer should expressly exclude risk coverage “if insurer does not intend to insure against risk likely to be inherent insured’s business ” (emphasis added)). Because were manifestly designed cover only business, however, would not expect those address risks not inherent business. To hold otherwise would require to conjure up and exclude explicitly any and all activities in Rose Paving might engage. Such a speculative exercise hypotheticals would nonsensical. sum, Mr. Vandenberg has provided a cogent rationale support conclusion that Westfield Rose Paving intended enter into insurance contract endless scope, covering any all businesses operated Rose Paving. Construing policies as a whole, conclude that both Westfield Rose intended that provide coverage Rose Paving’s construction related business. Accordingly, do coverage Mr. Vandenberg’s injury on yacht.
(…continued) WL *5 (N.D. Ill. Aug. 13, 2012) (holding policy provided coverage because insured “was a single
entity performed multiple services as a part condominium development business—which was named insured Policies”). Vandenberg also submits that, umbrella policy does same limitations as CGL policy, intended apply beyond Rose Paving’s construction business. He relies absence business description separate umbrella policy document. But, points out, identification Paving’s contained document labeled “common declarations” summarizes entire agreement. R.56 Specifically, document states “this consists following coverage parts” lists “commercial umbrella part.” fails invite our attention documentation would support determination Westfield, through umbrella policy, intended insure activities beyond business. *15 15 ‐
B. policies’ watercraft exclusion provides
independent basis affirming court’s judgment. exclude from “‘[b]odily injury’ … arising out of ownership, maintenance, use or entrustment to others of any … watercraft owned or operated by or rented or loaned to insured.” In his state complaint, Vandenberg alleged Paving negligently had “[f]ailed to railing or equivalent protection of top deck peripheral areas which were accessible to passengers,” “[f]ailed to prevent SCOT VANDENBERG … from accessing top deck of yacht,” “[a]llowed … SCOT VANDENBERG[] to access areas of top deck which did railings equivalent protection,” “[f]ailed warn … SCOT VANDENBERG[] lack railings equivalent protection top peripheral areas top deck,” “[a]llowed bench be placed inches rear unrailed top deck.”
No. ‐ 2009 submits that, under Illinois law, negligent maintenance, ownership, use of bench was a concurrent cause of injuries and, therefore, watercraft exclusion does not preclude coverage. maintains watercraft exclusion bars coverage under use of yacht was intertwined inextricably with all theories of recovery.
We recognized previously that, under Illinois law, an insurance does not claims are “intertwined” an excluded liability. See Nautilus Ins. Co. v. ‐ N. Milwaukee Ave., LLC , F.3d 818, (7th Cir. 2009). Nautilus , we addressed whether a claim seeking compensation property damage barred by policy’s contractor ‐ subcontractor exclusion. See id. 821–23. We concluded “the presence of an alternative theory of relief … insufficient trigger coverage” when plaintiff does allege “injury independent the” injury sustained result of excluded liability. Id. Thus, found determinative (…continued)
litigation.”); Oakley Transp., Inc. v. Zurich Co. 1099, (Ill. App. Ct. 1995) (noting “court must ordinarily confine inquiry comparison allegations underlying complaint relevant provisions determining duty defend”). Indeed, Appellate recently decided Vandenberg’s unfiled complaint should be considered doctrine “true but unpleaded facts.” See Md. Cas. Co. Dough Mgmt. WL *9 (Ill. App. Ct. June 30, 2015). held “that self serving allegations unfiled amended complaint cannot be presumed true are type facts intended covered true but unpleaded facts doctrine.” that “the statutory claims in the underlying complaints [sought] recovery for same loss all the other claims— property damage arising out of faulty excavation performed by [the defendant’s] contractors subcontractor—and coverage property damage excluded contractor subcontractor exclusion.” (emphasis in original).
In reaching our conclusion Nautilus , relied, in part, decision of Supreme of Illinois Northbrook Property Casualty Transportation Joint Agreement (Ill. 2000). Northbrook court held exclusion bars injuries associated excluded conduct, even if plaintiff proceeds alternative theory recovery implicates excluded conduct indirectly. explained: excludes injuries arising from
school districts’ use or operation motor vehicle. Allegations school districts inadequately planned inspected bus routes failed warn bus drivers potential hazards along routes are nothing more than rephrasings fact students’ injuries arose school districts’ use operation motor vehicle. Contrary appellate court’s holding, students’ complaints failed allege injuries arose events wholly independent negligent operation bus. Northbrook therefore has no duty defend school districts underlying lawsuits.
18 14 ‐ 2009 Id. at 254–55 (citation omitted) (internal quotation marks omitted). Thus, in order succeed, the allegations in Vandenberg’s complaint must be “wholly independent of negligent operation of the [watercraft].” (internal quotation marks omitted).
No.
The Appellate recently reaffirmed these principles applied them to the same state court complaint at issue here. In Maryland Casualty Co. Dough Management WL (Ill. App. Ct. June 2015), the court addressed whether identically worded watercraft exclusion contract barred coverage the injuries that sustained on yacht. See id. *7. that action, Maryland Casualty Co., insurer had provided coverage to Dough Management, maintained had no duty to defend or indemnify Dough Management under policy. See id. *2–3. court noted “policy specifically exclude[d] coverage any bodily injury ‘arising out ownership, maintenance, use, or entrustment others any … watercraft owned or operated by rented loaned any insured.’” Id. *7 (second alteration original). court concluded “the Vandenbergs alleged [in their state court complaint] insureds failed properly maintain yacht failing railing top deck, allegations fall squarely under watercraft exclusion.” Id. “Therefore, based personal injury complaint,” continued, “the Vandenbergs’ claims are excluded CGL policy.”
(…continued)
case, complaint alleges negligent acts are potentially within policy, such failure adequately supervise children negligent operation day care center. These alleged acts are separate distinct allegations relating negligent operation automobile.”).
With guidance Appellate Illinois, reach same conclusion. Mr. Vandenberg fell top deck yacht after bench he sitting tipped over. Because top deck yacht did not have railing, he fell substantial distance, resulting his injuries paralysis. his state court complaint, Mr. recognized injury would occurred if had provided railing prevented him accessing top deck yacht. Thus, accident Vandenberg’s resulting injuries were “wholly independent of” negligent operation, maintenance, use yacht. Northbrook Prop. Cas. (internal quotation marks omitted). Vandenberg’s injuries therefore come policies’ watercraft exclusion, do coverage.
Conclusion judgment affirmed.
AFFIRMED
[1] Bridgeview Investments listed as additional insured capacity manager lessor premises.
[2] R.56 at 49.
[3] Id. 50.
[4] R.56 54.
[5] CGL declarations determine scope both policies. Although umbrella did contain similar (continued…)
[10] had jurisdiction pursuant U.S.C. § 1332. We jurisdiction under U.S.C. §
[11] Westfield also maintains it never breached its duty defend because filed declaratory action it bound settlement settlement overtly collusive, breached multiple conditions, forfeited coverage. Because we decide prevails first two theories, do address its remaining contentions .
[12] Appellant’s Br.
[13] R.56
[14]
[15] R.56 86; R.56 25.
[16] R.56
[17] R.89
[18] Other courts, when faced with analogous circumstances, adopted similar interpretations. See Steadfast Ins. Co. v. Dobbas , No. CIV. S FCD JFM, WL 324023, *6 (E.D. Cal. Feb. 5, 2008) (holding that, because policy describes business insured “Railroad Contractor” “[t]he Declarations page tailored for this particular policy limited coverage policy based upon business description,” “policy unambiguously provide[d] coverage … for injuries relating business ‘Railroad Contractor’” (emphasis original)); Gemini Ins. Co v. S J Diving, Inc. , F. Supp. 2d 641, (S.D. Tex. 2006) (holding policy applied “only marine survey operations” company’s involvement with outdoor rock concert would unreasonable “to conclude covers all activity, specifically excluded, when insured negotiated as, described itself be, marine operation”); Cooper v. RLI Ins. Co. No. CV WL 367721, *8 (Conn. Super. Ct. June 1996) (holding CGL “does coverage accidents associated business activity different activity initially sought”); cf. Phila. Indem. W. Irving Park, LLC C (continued…)
[20] 78; R.56 at 15.
[21] R.45 8–9. unfiled amended complaint, alleged negligently “[p]rovided wobbly bench used SCOT VANDENBERG he fell.” R.13 However, insurer’s duty defend is limited those allegations contained operative complaint. See Mass. Bay Unique Presort Servs., Inc. (Ill. App. Ct. 1997) (“It well settled allegations complaint are dispositive insurer’s duty defend findings underlying (continued…)
[22] decisions of the Appellate of reflect the distinction between dependent independent claims. Compare Mass. Bay Ins. Co. , N.E.2d (“In this case, the underlying plaintiffs’ count XXVII is specifically dependent upon the fact their injuries occurred in a vehicle accident. This drug ‐ testing regulation would apply the underlying plaintiffs’ negligence action if their injuries had been caused some instrumentality other than vehicle. Thus, the negligence alleged in count XXVII is inextricably intertwined with the policy’s excluded instrumentality, namely, the vehicle.”), Mount Vernon Fire Ins. Co. v. Heaven’s Little Hands Day Care , N.E.2d 1034, (Ill. App. Ct. 2003) (“[W]e find after reviewing the allegations in the underlying complaint the victim’s death resulted nonvehicular conduct the part of Heaven’s Little Hands its employees. allegations in the complaint assert multiple theories of negligence including failure maintain proper census of the children attending the day care facility. Had Leon kept an accurate head count children inside van if someone inside Heaven’s Little Hands had noticed Tyrelle’s absence soon after van question had arrived day care facility, Tyrelle would died. short, van situs, rather than cause, Tyrelle’s death.”), Louis Marsch, Inc. v. Pekin Ins. Co. N.E.2d (Ill. App. Ct. 1985) (“Thus if trier fact concluded Marsch had failed duty Chizmar under Road Construction Injuries Act, fact dump truck was instrumentality which ultimately injured Chizmar would be but one two concurrent causes injury, one excluded Aetna policy, other so excluded. If insured arises negligent acts constitute non auto related conduct, should applicable regardless automobile exclusion fact automobile involved occurrence.”), U.S. Fid. Guar. Co. State Farm Mut. Auto. (Ill. App. Ct. 1982) (“In present (continued…)