Opinion
No. 1-05-0403
May 30, 2006. Withdrawn by the Court on October 22, 2007.
Appeal from the Circuit Court of Cook County 99 CH 04867 Aaron Jaffe, Judge, presiding.
Defendant Caroline Cogtella filed a lawsuit against defendants DePaul University (DePaul), LL Engineers and Holabird Root (HR), alleging that she suffered bodily injury due to her exposure to the fluorescent lighting selected and installed in DePaul University's Goldblatt building. HR tendered its defense of Cogtella's complaint to plaintiff American Economy Insurance Co. (American Economy) because American Economy was the insurer of Metrick Electric Co. (Metrick), the electrical subcontractor that HR hired to install the lighting at the Goldblatt building and HR was a named additional insured on Metrick's insurance policy. American Economy denied coverage and filed this declaratory judgment action as to its duty to defend in the Cogtella litigation. The trial court, in considering cross-motions for summary judgment, held that American Economy had an obligation to defend HR in the Cogtella litigation.
American Economy appeals, arguing that the trial court erred in finding that American Economy had a duty to defend HR because the complaint filed by Cogtella does not allege any negligence by Metrick and the trial court could not consider a third-party complaint filed by DePaul to find such a duty.
In December 1995, Cogtella filed her complaint for negligence, professional negligence, and negligent infliction of emotional distress against HR, DePaul, and LL Engineers. Cogtella's complaint alleged the following facts.
On or about November 1, 1991, the City of Chicago (City) and DePaul entered into an agreement in which the City sold real estate known as the Goldblatt building to DePaul, and DePaul, in turn, granted the City a leasehold interest for a portion of the building for City offices. Pursuant to that agreement, the City contracted with HR to be the architect and general contractor for the design and construction of the City's space in the Goldblatt building. LL Engineers was the electrical subcontractor on this project. All plans and specifications for the design and construction of the City's space were submitted to DePaul for approval.
Cogtella alleged that HR, DePaul, and LL Engineers selected and installed fluorescent light fixtures and lights in the City's space. However, they did not choose to shield or filter the lights with commercially available and reasonably priced diffusers or filters that would diffuse or reduce the ultraviolet (UV) rays emitted by the fluorescent lights to a safe level. Cogtella further claimed that, "At no time during the planning, preparation of specifications, or construction of the City's leasehold space did Defendants consider the possible health effects on people occupying the City's space when they decided to install fluorescent lighting in the space."
Cogtella worked as the risk manager for the City's department of finance, risk management office, which moved into a portion of the City's space in the Goldblatt building. Cogtella had been previously diagnosed with lupus erythematosus, an autoimmune disease which causes inflammation of various parts of the body, especially the skin, joints, blood and kidneys. At the time Cogtella began working in the Goldblatt building, her illness was under control and did not cause any impairment in her ability to perform her job. However, within days of Cogtella's move to the new work area in the Goldblatt building, she experienced a sudden, serious illness. She suffered severe erythema and edema of her face, neck and hands associated with first degree burns, skin lesions, hair loss, severe joint pain, vision impairment, and exhaustion. Cogtella alleged that this sudden illness was caused by her exposure to the unfiltered and undiffused fluorescent lighting in her work area.
In count I, Cogtella alleged that HR, DePaul and LL Engineers had a duty to provide a safe work area, free from hazards, for all people occupying the Goldblatt building and that they carelessly and negligently breached their duty and caused severe physical harm to Cogtella. These negligent acts and omissions proximately caused Cogtella to suffer emotional distress of both a physical and mental nature and she will continue to suffer severe emotional and physical illness and financial harm. In count II, Cogtella alleged that HR owed Cogtella a duty to design and construct the City's space in a reasonably safe manner and was guilty of one or more of the following careless and negligent acts or omissions:
"a. Failed to reasonably educate itself about current medical and scientific information and literature available regarding the dangers of exposure to UV emissions from fluorescent lights;
b. Selected unsafe fluorescent lighting fixtures and lights which it designated to be installed in the City's leasehold space;
c. Failed to reasonably educate itself about current medical and scientific literature on the subject of UV radiation from fluorescent lights;
d. Negligently selected lighting subcontractor, Defendant LL, which was not knowledgeable regarding the health effects of unfiltered fluorescent lighting and the appropriate selection of the types of fluorescent lights which would minimize exposure to harmful UV rays from the fluorescent light selected for the City's leasehold space;
e. Undertook no testing of, monitoring of, or any type of scientific evaluation of the level of harmful UV emissions emitted from the fluorescent lights installed in the City's leasehold space;
f. Was otherwise careless and negligent."
In June 1997, DePaul filed a third-party complaint against Metrick and the City. In count II, DePaul alleged that Metrick "was in charge of the installation of the electrical light fixtures in [Cogtella's] work station and on the fourth floor of the DePaul Center." DePaul further alleged that Metrick owed a duty to Cogtella to install electrical lighting fixtures that would not cause her physical, mental or emotional illness. DePaul claimed that Metrick was guilty of the following careless and negligent acts and/or omissions:
"a. Failed to reasonably educate itself regarding the potential danger or harm caused by exposure to ultraviolet ray emissions from florescent lights which they installed into buildings;
b. Failed to ensure that the florescent lighting fixtures and light installed in the City's work space on the fourth floor of the DePaul Center and in [Cogtella's] work station were safe so as not to cause physical, mental and emotion illness to its workers;
c. Failed to properly consult with its lighting engineer, LL Engineers, and its architect, Holabird Root, in order to ensure that the florescent lights and lighting systems chosen by the City of Chicago for [Cogtella's] work station and the fourth floor of the Goldblatt building were safe and did not present a danger to the City of Chicago employees occupying the City of Chicago's leasehold space; and
d. Was otherwise careless and negligent."
In March 1999, American Economy filed its complaint for declaratory judgment, asking the trial court to find that HR, DePaul, the City, and LL Engineers did not qualify as additional insureds on Metrick's policy, and therefore, American Economy had no duty to defend or indemnify the defendants in connection with the Cogtella litigation.
American Economy and Metrick entered into a contract for general liability insurance, effective October 1, 1993, to October 1, 1994. HR, DePaul, LL Engineers and the City were added as additional insureds under the policy pursuant to an additional insured endorsement, which provided as follows:
"WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown in the Schedule but only with respect to liability arising out of `your work' for that insured by or for you."
The Cogtella litigation was settled in January 2000. In January 2004, the trial court denied American Economy's motion for summary judgment and granted HR's cross motion for summary judgment. In November 2004, the trial court entered a money judgment in the amount of $173,789.40, in favor of HR. This appeal followed.
The issue before us on appeal is whether American Economy has a duty to defend HR as an additional insured when the only allegations against the named insured, Metrick, are in DePaul's third-party complaint. American Economy maintains that because Cogtella did not allege any negligence on Metrick's part in the underlying complaint and the trial court is limited to those allegations contained in Cogtella's complaint, it does not have a duty to defend HR.
The construction of an insurance policy and a determination of the rights and obligations thereunder are questions of law for the court which are appropriate subjects for disposition by way of summary judgment. Crum Forster Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 391 (1993). We review cases involving summary judgment de novo. Ragan v. Columbia Mutual Insurance Co., 183 Ill. 2d 342, 349 (1998). The construction of an insurance policy is a question of law and is also reviewed de novo review. United Services Automobile Ass'n v. Dare, 357 Ill. App. 3d 955, 963 (2005).
"`To determine an insurer's duty to defend its insured, a court must look to the allegations of the underlying complaints. If the underlying complaints allege facts within or potentially within policy coverage, the insurer is obliged to defend its insured even if the allegations are groundless, false, or fraudulent. [Citation.] An insurer may not justifiably refuse to defend an action against its insured unless it is clear from the face of the underlying complaints that the allegations fail to state facts which bring the case within, or potentially within, the policy's coverage. [Citation.]'" Dare, 357 Ill. App. 3d at 963, quoting Northbrook Property Casualty Co. v. Transportation Joint Agreement, 194 Ill. 2d 96, 98 (2000). Any doubt with regard to such duty is to be resolved in favor of the insured. Dare, 357 Ill. App. 3d at 963. The burden is on the insurer to show that a claim falls within a provision that limits or excludes coverage. American Alliance Insurance Co. v. 1212 Restaurant Group, L.L.C., 342 Ill. App. 3d 500, 505 (2003). A trial court may consider evidence beyond the underlying complaint only if such evidence does not tend to determine an issue crucial to the underlying lawsuit. Royal Insurance Co. of America v. Insignia Financial Group, Inc., 323 Ill. App. 3d 58, 64 (2001).
We find the decision in West Bend Mutual Insurance Co. v. Sundance Homes, Inc., 238 Ill. App. 3d 335 (1992), to be instructive. In that case, Ronald Bass, a carpenter employed by Lenny Szarek, Inc., a subcontractor, was injured on a construction site. Bass filed a complaint against the general contractor, Sundance Homes. At the time of the accident, Sundance was insured under a general liability policy by Great American Insurance Companies, and a West Bend policy purchased by Szarek named Sundance as an additional insured. West Bend, 238 Ill. App. 3d at 336. West Bend declined to provide a defense to Sundance, "maintaining that the complaint contained no allegation imputing liability to Sundance as a result of the actions or conduct of Szarek." West Bend, 238 Ill. App. 3d at 336. West Bend filed a declaratory judgment action against Sundance and Bass, and Great American sought a declaration of rights between itself and West Bend. In granting Great American's motion for summary judgment, the trial court found that based on the Szarek policy, West Bend did have the duty to defend Sundance in the action. West Bend, 238 Ill. App. 3d at 336-37.
In determining whether West Bend had a duty to defend Sundance, the reviewing court considered Sundance's third-party complaint against Szarek for contribution as well as statements by coworkers. West Bend, 238 Ill. App. 3d at 337. The court found that this evidence "raise[d] the possibility that Szarek may also have been at fault." West Bend, 238 Ill. App. 3d at 337. The West Bend court concluded that the allegations in the underlying action were well within the coverage of the Szarek policy. West Bend, 238 Ill. App. 3d at 338.
American Economy relies on the Second District case of National Union Fire Insurance Co. of Pittsburgh v. R. Olson Construction Contractors, Inc., 329 Ill. App. 3d 228 (2002), to support its argument that this court can only consider the allegations contained in the Cogtella complaint and not DePaul's third-party complaint. We note that decisions of other appellate districts are not binding on this court. See State Farm Fire Casualty Co. v. Yapejian, 152 Ill. 2d 533, 539-40 (1992). In National Union, the Second District held that a trial court must look only to the underlying complaint to determine whether there is a duty to defend. National Union, 329 Ill. App. 3d at 235. We disagree with this conclusion.
In that case, National Union Fire Insurance Company of Pittsburgh, Pennsylvania (National Union), filed a complaint for declaratory judgment against R. Olson Construction Contractors, Inc., d/b/a R. Olson Concrete Construction (Olson), and Leroy and Donna Schmidt. National Union sought a determination that it was not obligated to defend Olson in an action brought by the Schmidts for Leroy's injuries suffered while an employee of Meyer Material Company. National Union, 329 Ill. App. 3d at 230. National Union provided a comprehensive general liability policy to Meyer as the named insured and Olson was named in an endorsement as an additional insured. The endorsement limited its coverage so that it would not cover Olson's liability arising from its own negligence or that of its employees. National Union, 329 Ill. App. 3d at 230. Olson was a concrete subcontractor for a construction project and hired Meyer to deliver concrete to the construction site. Schmidt was a driver for Meyer. National Union, 329 Ill. App. 3d at 230. Schmidt was injured at the site and filed a complaint against Olson and others, alleging various negligent acts or omissions by Olson caused Schmidt's injuries. Meyer was not named as a defendant in Schmidt's complaint. National Union, 329 Ill. App. 3d at 230. Olson asked National Union to provide a defense in the Schmidt action, but National Union declined. Olson then filed a third-party complaint for contribution against Meyer, arguing that Meyer was guilty of the negligent acts or omissions that proximately caused Schmidt's injuries. National Union, 329 Ill. App. 3d at 230-31. Specifically, Olson made nearly identical allegations of negligence against Meyer as those that Schmidt raised against Olson. National Union, 329 Ill. App. 3d at 232-33.
We find the circumstances and allegations surrounding the third-party complaint in National Union to be distinguishable from those in the instant case. Notably, the endorsement in Meyer's policy with National Union specifically excluded coverage resulting from Olson's own negligence, and the court considered Olson's third-party complaint as an attempt to avoid that exclusion by placing all the negligence on Meyer.
We find that the conclusion in West Bend to be the more reasoned approach. Looking at a third-party complaint is in line with the general rule that a trial court may consider other evidence if it does not determine an issue critical to the underlying action (see Royal Insurance, 323 Ill. App. 3d at 64). The trial court should be able to consider all the relevant facts contained in the pleadings, including a third-party complaint, to determine whether a duty to defend arises. For example, in West Bend, the reviewing court found that the underlying complaint implied that other parties may have been in charge at the site, and this implication was developed in the third-party complaint. West Bend, 238 Ill. App. 3d at 337. A contrary holding would ask the trial court to ignore properly pleaded facts and allegations that set out a duty to defend.
In the present case, looking at both the Cogtella complaint and DePaul's third-party complaint, the facts clearly raise the potential of coverage due to Metrick's actions. The Cogtella complaint based part of its allegations on the negligent installation of the fluorescent lighting, which, according to DePaul's complaint, was Metrick's task on the project. At this stage of the proceedings, we are to only determine if there is a potential for coverage, and do not consider what the ultimate finding of negligence should be. Since this district has stated that trial courts may look to other evidence, such as a third-party complaint, the trial court in the present case properly held that American Economy has a duty to defend based on the alleged facts that are potentially within the policy's coverage.
Based on the foregoing reasons, we affirm the decision of the circuit court of Cook County.
Affirmed.
CAHILL, P.J. and GORDON, J., concur.