                           ILLINOIS OFFICIAL REPORTS
                                         Appellate Court




        Pekin Insurance Co. v. Tovar Snow Professionals, Inc., 2012 IL App (1st) 111136




Appellate Court            PEKIN INSURANCE COMPANY, Plaintiff-Appellant, v. TOVAR
Caption                    SNOW PROFESSIONALS, INC., and ANN HOLLAND, Defendants-
                           Appellees.



District & No.             First District, Second Division
                           Docket No. 1-11-1136


Filed                      May 8, 2012


Held                       In an action seeking a declaratory judgment that plaintiff insurer had no
(Note: This syllabus       duty to defend defendant snow removal company in the underlying action
constitutes no part of     alleging injuries suffered by a person who slipped and fell as a result of
the opinion of the court   defendant’s snow removal activities, summary judgment was properly
but has been prepared      entered for the snow removal company, notwithstanding the insurer’s
by the Reporter of         contentions that the commercial general liability policy it issued to a
Decisions for the          concrete company, which then subcontracted with the snow removal
convenience of the         company, restricted additional coverage endorsements to construction
reader.)
                           contracts by the use of the word “construction” in the endorsement
                           heading, since ambiguities in insurance policies are resolved in favor of
                           the insured, Illinois law clearly provides that a heading or caption of a
                           policy does not modify coverage provided by the actual policy language,
                           and in the instant case, the facts of the fall were within the coverage
                           provided by the actual text of the policy, despite the language in the
                           heading.


Decision Under             Appeal from the Circuit Court of Cook County, No. 10-CH-16348; the
Review                     Hon. Peter A. Flynn, Judge, presiding.
Judgment                    Affirmed.


Counsel on                  Pretzel & Stouffer, Chtrd., of Chicago (Robert Marc Chemers and Peter
Appeal                      G. Syregelas, of counsel), for appellant.

                            Hunt Law Group, LLC, of Chicago (Brian J. Hunt and Jake A. Cilek, of
                            counsel), for appellees.


Panel                       PRESIDING JUSTICE QUINN delivered the judgment of the court, with
                            opinion.
                            Justices Cunningham and Harris concurred in the judgment and opinion.



                                              OPINION

¶1          Pekin Insurance Company (Pekin), a commercial general liability insurer, brought an
        action against Tovar Snow Professionals, Inc. (Tovar), and Ann Holland for a declaratory
        judgment that Pekin did not owe Tovar a duty to defend in the underlying lawsuit brought
        by Ann Holland for alleged personal injuries due to Tovar’s negligent snow removal
        activities. The circuit court entered summary judgment in favor of Tovar and against Pekin.
        Pekin appeals the judgment.

¶2                                             Background
¶3           This case originated via a slip and fall negligence lawsuit filed in the circuit court by Ann
        Holland against Tovar and Dunleavy Concrete, Inc. (Dunleavy), arising out of their snow and
        ice removal activities where Holland fell. Tovar tendered the defense of the Holland lawsuit
        to Pekin pursuant to the terms of Tovar’s subcontract with Dunleavy. Pekin had issued a
        commercial general liability insurance policy to the subcontractor Dunleavy for the period
        in question which covered Tovar via a blanket automatic additional insured endorsement
        applicable to any written contract Dunleavy entered into requiring such coverage. Pekin
        denied coverage and sought a declaratory judgment absolving it from any responsibility.
¶4           Pekin and Tovar filed cross-motions for summary judgment regarding Tovar’s claim that
        it is covered under the Pekin insurance policy issued to Dunleavy. Pekin argued that the
        insurance policy it issued to Dunleavy restricted additional coverage endorsements only to
        construction contracts and did not include activities related to snow and ice removal because
        the word “construction” appeared as a limiting adjective in the endorsement heading in the
        insurance contract.
¶5           The trial court ruled that pursuant to applicable Illinois law, an isolated, undefined word
        in a title or heading cannot operate to modify or restrict insurance coverage that is otherwise

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       expressly conveyed in the text of an insurance policy. The trial court ruled that because the
       text of the insurance policy issued by Pekin plainly and clearly afforded coverage to Tovar,
       it granted summary judgment in favor of Tovar and against Pekin. For the reasons stated
       herein, this court affirms the circuit court ruling.

¶6                                    Standard of Review
¶7        The applicable standard of review for a ruling on a motion for summary judgment is de
       novo. Home Insurance Co.v. Cincinnati Insurance Co., 213 Ill. 2d 307, 315 (2004).

¶8                                             Analysis
¶9         Summary judgment is appropriate when there are no genuine issues of material fact and
       when the moving party is entitled to judgment as a matter of law. Kajima Construction
       Services, Inc. v. St. Paul Fire & Marine Insurance Co., 227 Ill. 2d 102, 106 (2007). In this
       insurance coverage dispute, the parties agree that there are no material factual disputes. The
       sole dispute concerns whether or not the construction of the insurance policy affords Tovar
       the ability to tender its defense of the underlying Holland negligence lawsuit to Pekin.
¶ 10       Tovar, relying on the fact that it was an additional insured under the insurance policy
       Pekin issued to Dunleavy, tendered its defense of the Holland suit to Pekin.
¶ 11       The contract language Pekin relied upon in denying coverage to Tovar as an additional
       insured is as follows:
               “1. Additional Insured–When Required By Written Construction Contract For
           Ongoing Operations Performed By You For An Additional Insured and/or Your
           Completed Operations
               A. With respect to coverage afforded under this section of the endorsement, Section
           II–Who is An Insured is amended to include as an insured any person or organization
           for whom you are performing operations, when you and such person or organization have
           agreed in a written contract effective during the policy period stated on the Declarations
           Page (hereinafter referred to as the ‘Policy Period’) and executed prior to the ‘bodily
           injury’ or ‘property damage’ for which coverage is sought, that you must add that person
           or organization as an additional insured on a policy of liability insurance (hereinafter
           referred to as the ‘Additional Insured’).
               The Additional Insured is covered only with respect to vicarious liability for ‘bodily
           injury’ or ‘property damage’ imputed from You to the Additional Insured as a proximate
           result of:
                    (1) Your ongoing operations performed for that Additional Insured during the
               Policy Period; or
                    (2) ‘Your work’ performed for the Additional Insured during the Policy Period,
               but only for ‘bodily injury’ or ‘property damage’ within the ‘products–completed
               operations hazard.’ ”
¶ 12       There are no contested issues arising from the language contained in section A other than
       whether the text really meant to include all written contracts. There are no contested issues

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       regarding whether the agreement was entered into during the policy period or whether or not
       it was executed prior to the damages for which coverage is sought or whether there existed
       a requirement that Tovar be added as an additional insured. The only issue is whether the text
       of section A, which includes all written contracts, defines “Who is An Insured,” or whether
       the heading/title/caption language of “Written Construction Contract” limits the definition
       of “Who is An Insured.”
¶ 13        Pekin argues that the insurance policy covered only “construction” activities and that the
       allegations of the underlying negligence action involving Holland are concerned only with
       snow and ice removal. Because snow and ice removal are not construction activities
       stemming from a construction contract, Pekin denied coverage and sought declaratory relief.
       However, as one can readily see from the quoted text above, the term “construction” appears
       only in the title or caption of the endorsement. The specific wording in the text of the
       endorsement contains no such limitation on the type of contract covered other than that they
       be written contracts. Pekin never defined the term “construction” and the term “construction”
       was used only in the heading and was omitted from the text of the provision that followed.
       The only limiting word in the text for any contracts covered by Pekin was the term “written.”
       This policy language is similar to that interpreted by our supreme court’s decision in Barth
       v. State Farm Fire & Casualty Co., 228 Ill. 2d 163, 174-75 (2008) (citing 2 Mark S. Rhodes,
       Couch Cyclopedia of Insurance Law § 15:57, at 302 (2d rev. ed. 1984)), which held that a
       contract term only used in a heading and not in the text and otherwise not defined cannot
       properly be imposed on an insured to exclude coverage. The policy language is also similar
       to that interpreted in Nudi Auto RV & Boat Sales, Inc. v. John Deere Insurance Co., 328 Ill.
       App. 3d 523, 532 (2002), where this court held that even though the title of a section of the
       insurance contract read “ ‘False Pretense Coverage,’ ” the relevant text of the provision
       contained no mention of any intent to defraud and the text of the provision stated that any
       auto acquired by the dealer was a covered auto under the “false pretense coverage.”
¶ 14        Pekin cites two statutory construction cases for the proposition that, in construing a
       statute, one should interpret any specific provision within the context of the entire statute
       including the statute headings under which the specific provisions appear. Daniels v.
       Corrigan, 382 Ill. App. 3d 66, 73 (2008); Illinois Bell Telephone Co. v. Illinois Commerce
       Comm’n, 362 Ill. App. 3d 652, 659 (2005) (citing People v. Warren, 173 Ill. 2d 348, 357
       (1996)). However, we are not dealing with statutory construction but the terms of an
       insurance policy. Further, the Illinois Bell court acknowledged that even in the context of
       statutory construction, “case law warns against putting undue emphasis on organizational
       devices. Headings cannot limit the plain meaning of the text ***.” (Internal quotation marks
       omitted.) Illinois Bell Telephone Co. v. Illinois Commerce Comm’n, 362 Ill. App. 3d at 661.
       The law is clear in Illinois that a heading or caption or title to a section of an insurance policy
       does not modify the coverage provided by the actual textual language appearing in the policy.
       Barth v. State Farm Fire & Casualty Co., 228 Ill. 2d at 174-75; Nudi Auto RV & Boat Sales,
       Inc. v. John Deere Insurance Co., 328 Ill. App. 3d at 532. Even in statutory construction, the
       Illinois Bell court held that “[a]s a rule[,] the words of the heading[ ] being more general[ ]
       will not control the more specific words of the act.” (Internal quotation marks omitted.)
       Illinois Bell Telephone Co. v. Illinois Commerce Comm’n, 362 Ill. App. 3d at 662. The actual

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       text of the Pekin insurance policy endorsement affords coverage to “a written contract
       effective during the policy period.” The word “contract” is not limited only to construction
       contracts, but requires only a “written contract.”
¶ 15        An insurer’s duty to defend its insured is quite broad. Guillen v. Potomac Insurance Co.
       of Illinois, 203 Ill. 2d 141, 150 (2003) (citing Outboard Marine Corp. v. Liberty Mutual
       Insurance Co., 154 Ill. 2d 90, 108 (1992)). In order to determine whether the insurer’s duty
       to defend has arisen, the court must compare the allegations of the underlying complaint to
       the policy language and must construe these items liberally. Pekin Insurance Co. v. XData
       Solutions, Inc., 2011 IL App (1st) 102769, ¶ 7 (citing United States Fidelity & Guaranty Co.
       v. Wilkin Insulation Co., 144 Ill. 2d 64, 73 (1991)). The law in Illinois has long been that
       ambiguities and doubts in insurance policies are resolved in favor of the insured, especially
       those that appear to exclude coverage. Dora Township v. Indiana Insurance Co., 78 Ill. 2d
       376, 379 (1980); United States Fidelity & Guaranty Co. v. Specialty Coatings Co., 180 Ill.
       App. 3d 378, 384 (1989). In this case, Pekin does not argue that the rule of construction
       applicable to insurance contracts which directs this court to construe ambiguities in favor of
       the insured should not apply.
¶ 16        Pekin attempts to distinguish this case from established case precedent by arguing that
       the bold language that is preceded by numeral “1.,” which reads “Additional
       Insured–When Required By Written Construction Contract for Ongoing Operations
       Performed By You For An Additional Insured and/or Your Completed Operations,”
       is not really a heading or title or caption, but really is part of the text of this section. This
       argument falls flat. The above-quoted section has all the hallmarks of a caption/heading/title
       as one would normally use such a device. It appears at the beginning. The lettering is in bold
       typeface. It utilizes an explanatory phrase rather than a sentence structure. Each word in the
       phrase begins with a capital letter. That is not to say that nonbolded, noncapitalized phrases
       or sentences cannot serve as headings or captions or titles, too. However, in this case, the
       argument must be rejected where we are asked by Pekin to read this section as if the
       abovequoted words are to precede each subsection as text rather than as a
       caption/heading/title. There are no indications anywhere in the policy or in the above-quoted
       section indicating that it is meant to be the beginning phrase or element of each sub-section
       that follows it. In fact, the many stylistic conventions for a heading/title/caption are utilized
       to indicate it is not text and to flag it as a heading/title/caption of this section, including that
       it appears as the introductory statement. Additionally, when attempting to actually read the
       abovequoted words as the first part of each subsection that follows, we are left with an
       ungrammatical, poorly punctuated jumble of sentences that would be the antithesis of a
       clearly written policy of insurance coverage.
¶ 17        It is clear from the underlying complaint, the actual text of the insurance policy language
       and the purpose for which the insurance policy was written for Dunleavy that the facts of the
       accident brought the Holland lawsuit within the insurance policy coverage despite the
       language in the heading of the endorsement section which Pekin argues limited the text to
       construction contracts only.



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¶ 18                                        Conclusion
¶ 19       For the foregoing reasons, the general liability insurer in this case, Pekin Insurance Co.,
       has a duty to defend Tovar Snow Professionals, Inc., as an additional insured for a claim
       arising out of a lawsuit brought by Ann Holland, who fell at the site following Tovar’s snow
       removal work. The circuit court did not err in finding Pekin had a duty to defend Tovar in
       the underlying tort lawsuit.

¶ 20      Affirmed.




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