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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

    PRECISION UNDERGROUND         PIPE :  IN THE SUPERIOR COURT OF
    SERVICES, INC.                     :        PENNSYLVANIA
                                       :
                    Appellant,         :
                                       :
                                       :
              v.                       :
                                       :
                                       :
    PENN NATIONAL MUTUAL CASUALTY :
    AND VERIZON PENNSYLVANIA, LLC :
    AND       PARKSIDE         UTILITY :
    CONSTRUCTION, LLC AND POHLIG :
    BUILDERS, INC., AND CHRISTOPHER :
    HAMMELL AND CHRISTINE HAMMELL :
                                       :
                     Appellees         : No. 3663 EDA 2018

               Appeal from the Order Entered December 3, 2018
                 In the Court of Common Pleas of Philadelphia
                  County Civil Division at No(s): 170902368


BEFORE:      MURRAY, J., STRASSBURGER, J.* and PELLEGRINI, J.*

MEMORANDUM BY STRASSBURGER, J.:                  FILED DECEMBER 03, 2019

        Precision Underground Pipe Services, Inc. (Precision) appeals from the

order entered December 3, 2018, which denied Precision’s motion for partial

summary judgment and granted summary judgment in favor of Penn

National Mutual Casualty (Penn National).       In that order, the trial court

concluded that Penn National had no duty to defend or indemnify Verizon

Pennsylvania, LLC (Verizon) and Parkside Utility Construction, LLC (Parkside)

____________________________________________


*   Retired Senior Judge assigned to the Superior Court.
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in an underlying civil action.1       After review, we reverse the order granting

summary judgment and remand for further proceedings.

       The trial court provided the relevant factual and procedural history of

this matter.

             Verizon entered into a contract with Parkside (Verizon-
       Parkside Agreement) to install an underground conduit for
       Verizon’s fiber optic cable in connection with a real estate
       development on the Ardrossan Farm Development in Radnor
       Township, Villanova, [Pennsylvania]. The Verizon-Parkside
       Agreement required Parkside to name Verizon as an additional
       insured on its policies of insurance and to provide a defense and
       indemnity to Verizon. On October 28, 2014, Parkside entered
       into a subcontract and hired Precision to provide necessary labor
       [(Parkside-Precision Agreement).] The subcontract required
       Precision to name Parkside and Verizon as additional insureds on
       the Penn National Policy [(Policy)] under certain conditions.
       Pursuant to the subcontract, any insurance coverage provided to
       Parkside or Verizon under the Policy was to be primary and
       noncontributory with respect to any other insurance available to
       Parkside and/or Verizon. The Parkside-Precision Agreement also
       required Precision to “defend, indemnify, and hold harmless”
       Parkside and Verizon.

             Penn National issued to Precision a policy of commercial
       general liability insurance with an effective date of January 4,
       2016 to January 4, 2017, and a policy limit of $1 million per
       occurrence and $2 million in the aggregate. Critically, the policy
       contains    an     “Automatic   Additional   Insureds-    Owners,
       Contractors, and Subcontractors” endorsement which provides in
       part:

               SECTION II- WHO IS AN INSURED
____________________________________________


1 According to Precision, Pohlig Builders, Inc. (Pohlig), “Verizon, Parkside and
[the Hammells] are named as defendants in the instant action only to the
extent they may have an interest in Precision’s claim against Penn National
and may be considered indispensable parties for purposes of this declaratory
judgment action.” Complaint, 9/20/2017, at ¶ 9.



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              1. Any person(s) or organization(s) (referred to
              below as additional insured) with whom you are
              required in a written contract or agreement to name
              as an additional insured, but only with respect to
              liability for “bodily injury,” “property damage” or
              “personal and advertising injury” caused, in whole or
              in part, by:

              (1) Your acts or omissions; or

              (2) The acts or omissions of those acting on your
              behalf;

              in the performance of your ongoing operations for
              the additional insured(s) at the location or project
              described in the contract or agreement. A person’s or
              organization’s status as an additional insured under
              this agreement ends when your operations for that
              additional insured are completed.

             On April 8, 2016, Christopher Hammell [(Hammell)], an
       employee of Precision, suffered injuries when he fell into a
       trench at a work site near Villanova, Pennsylvania. [The
       Hammells] filed an action against Parkside and Verizon, as well
       as other defendants in the Court of Common Pleas,
       Philadelphia.1
             ______
             1 The action is captioned [Hammell v. Pohlig Homes,

             LLC, et. al.], CP Phila 1701-2119 [(Hammell).2] Precision


____________________________________________


2  “On August 13, 2018, a Suggestion of Death was filed for [] Hammell. On
the same date, the Estate of Christopher Hammell was substituted for []
Hammell.” Precision’s Brief at 2, n.1. “After [the trial court’s] order
granting summary judgment to Penn National was issued, [Hammel’s] wife
filed a second amended complaint[,]” which “alleged that the pain from
Hammell’s fall caused him to become addicted to opioids and that this
addiction resulted in an overdose and his death. In addition, the claims of
negligence were expanded.” Id. at 5, n.1.




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              is not an original party to this action; nor has Precision[3]
              been joined or named in any pleading.

       The [A]mended [C]omplaint[4] in the underlying action alleges as
       follows:

              [7.] Verizon and Parkside “owned, operated,
              maintained, managed, supervised, possessed and/or
              controlled the premises at or near Villanova,
              [Pennsylvania].”

              [8.] At all times material hereto, “there was a
              dangerous and hazardous condition in the nature of
              a trench at the premises.”

              [9.] At all times relevant hereto, Verizon and
              Parkside “had a common law duty and/or a
              contractual duty to protect workers at the premises.”

              [10.] Verizon and Parkside had a duty to protect
              Precision’s workers “from unreasonably dangerous
              conditions caused by its conduct and/or failure to
              act.”

              [11.] At all times relevant hereto, Verizon and
              Parkside “acted and/or failed to act by and through
              their respective agents, servants, workmen and/or
              employees.”

____________________________________________


3 “Precision was not named as a defendant in [Hammell], as Precision was
Hammell’s employer and immune from suit pursuant [to] the Pennsylvania
Workers’ Compensation Act.” Action for Declaratory Judgment, 9/20/2017,
at ¶ 17. See 77 Pa. Stat. Ann. § 481 (“The liability of an employer under
th[e Workers’ Compensation A]ct shall be exclusive and in place of any and
all other liability[.]”).

4 According to Precision, the averments set forth in the Amended Complaint,
which are pertinent to this appeal, “are identical to the averments in the
initial complaint. The only significant differences are that additional
defendants have been added to the [A]mended [C]omplaint and the
paragraphing has been adjusted.” Precision’s Brief at 5, n.1.



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              [16.] On April 8, 2016, at approximately 1:30 p.m.,
              Hammell was working as an employee for Precision
              at or near Villanova, Pa. when a trench gave way
              and/or he fell in a trench, causing him to sustain
              serious injuries.

              [28 a-i and 30 a-i.] The aforesaid act was caused as
              a direct and proximate result of the carelessness and
              negligence of defendants Verizon and Parkside, by
              and through their agents, servants, workmen and/or
              employees and their negligence.

              On February 21, 2017, Parkside, claiming to be one of
        Precision’s named additional insureds, tendered demand that
        Penn National defend and indemnify Parkside. Parkside’s tender
        was based on Precision’s position, reflected in this declaratory
        judgment action, that both Parkside and Verizon are additional
        insureds under the [P]olicy issued to Precision. On April 7, 2017
        and August 21, 2017, respectively, Penn National declined to
        provide additional insured coverage to Verizon and Parkside on
        grounds that the [A]mended [C]omplaint in [Hammell] does not
        allege that negligence by Precision caused [] Hammell’s injury.

Trial Court’s Memorandum Opinion, 2/8/2019, at 1-4 (citations omitted).

        On September 20, 2017, Precision filed the instant action against, inter

alia, Penn National, asserting it was entitled to declaratory judgment5 and

“damages for breach of contract for failing to provide a defense and

indemnity to alleged additional insureds” Id. at 4.         According to Penn

National, the averments set forth in the underlying action did not trigger

coverage under the Policy. Penn National’s Answer and New Matter,

11/3/2017, at 4.
____________________________________________


5   See 42 Pa.C.S. §§ 7531-41 (Declaratory Judgments Act).




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        Following discovery, Precision filed a motion for partial summary

judgment.        See    Precision’s    Motion    for   Partial   Summary   Judgment,

6/1/2018.6       On August 20, 2018, Penn National filed a cross-motion for

summary judgment. On December 3, 2018, the trial court denied Precision’s

motion for partial summary judgment and granted Penn National’s motion.

Specifically, the trial court found that “[s]ince Precision is neither a named

defendant nor otherwise implicated in [Hammell,] Penn National does not

have a duty to defend Verizon and Parkside as additional insureds.”

Memorandum Opinion, 2/8/2019, at 8 (footnote omitted).                Moreover, the

trial court found that, because “there is no duty to defend, the remaining

claim for breach of contract also fails. There is also no duty to indemnify.”

Id. at 8, n.8.

        This timely-filed appeal followed.7 Although presented as four distinct

issues, Precision’s claims on appeal are all interrelated.           Thus, we shall

address them together. In essence, Precision asserts the trial court erred in

____________________________________________


6 Precision’s motion for partial summary judgment is not included in the
certified record before us. “While this Court generally may only consider
facts that have been duly certified in the record, [] where the accuracy of a
document is undisputed and contained in the reproduced record, we may
consider it.” Commonwealth v. Barnett, 121 A.3d 534, 546 n.3 (Pa.
Super. 2015). Here, the reproduced record contains Precision’s motion and
there is no dispute as to its contents. Therefore, we considered the
document in our review.

7   Both Precision and the trial court complied with Pa.R.A.P. 1925.




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determining that Penn National was entitled to summary judgment because

Penn National’s “duty to defend was not triggered by the” Amended

Complaint.     Precision’s Brief at 15.          Specifically, Precision argues that, in

determining that Penn National had no duty to defend, the trial court inter

alia: (1) “read the [Amended C]omplaint too narrowly, ignoring the claim

that   Verizon    and    Parkside,    for      whom    Precision   was   working   as   a

subcontractor, failed to protect Hammell, Precision’s employee, from

dangerous      conditions     created       by    Precision[;]”    and   (2)   “erred   in

distinguishing Ramara Inc. v. Westfield Insurance Co., 814 F.3d 660 (3d

Cir. 2017),[8] a case on all points with the instant action, including the same

additional insured endorsement.” Precision’s Brief at 15. We begin with the

relevant legal principles.

       “In a declaratory judgment action, just as in civil actions generally,

summary judgment may be granted only in those cases in which the record

clearly shows that there are no genuine issues of material fact and the

moving party is entitled to judgment as a matter of law.”                        Certain

____________________________________________


8 “[T]he holdings of federal circuit courts bind neither this Court nor the trial
court, but may serve as persuasive authority in resolving analogous cases.”
Montagazzi v. Crisci, 994 A.2d 626, 635, n.7 (Pa. Super. 2010). In
Ramara, the Third Circuit Court of Appeals determined that the allegations
in an underlying negligence complaint were enough to trigger an insurer’s
duty to defend an additional insured, despite the fact that the named insured
was not a party in the underlying cause of action. Ramara, 814 F.3d at
677-80.




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Underwriters at Lloyds v. Hogan, 852 A.2d 352, 354 (Pa. Super. 2004)

(citation and quotation marks omitted). When reviewing a challenge to an

order granting summary judgment, our standard of review is well settled. “A

reviewing court may disturb the order of the trial court only where it is

established that the court committed an error of law or abused its discretion.

As with all questions of law, our review is plenary.” Krauss v. Trane U.S.

Inc., 104 A.3d 556, 562-63 (Pa. Super. 2014) (citations omitted).

      We view the record in the light most favorable to the non-
      moving party, and all doubts as to the existence of a genuine
      issue of material fact must be resolved against the moving party.

                                 ***

      Motions for summary judgment necessarily and directly implicate
      the plaintiff’s proof of the elements of [its] cause of action.
      Summary judgment is proper if, after the completion of
      discovery relevant to the motion, including the production of
      expert reports, an adverse party who will bear the burden of
      proof at trial has failed to produce evidence of facts essential to
      the cause of action or defense which in a jury trial would require
      the issues to be submitted to a jury. Thus, a record that
      supports summary judgment will either (1) show the material
      facts are undisputed or (2) contain insufficient evidence of facts
      to make out a prima facie cause of action or defense and,
      therefore, there is no issue to be submitted to the jury.

H & R Block E. Tax Servs., Inc. v. Zarilla, 69 A.3d 246, 248–49 (Pa.

Super. 2013) (citations omitted); see also Pa.R.Civ.P. 1035.2.

             An insurer’s duty to defend an action against the insured is
      measured, in the first instance, by the allegations in the
      plaintiff's pleadings[.] This duty is distinct from and broader
      than an insurer’s duty to provide indemnification. Provided the
      underlying allegations encompass an injury that is actually or
      potentially within the scope of the policy, an insurer must defend


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       its insured. This duty to defend persists until the claim is
       confined to a recovery that the policy does not cover.

                                          ***

             In the context of a declaratory judgment action, the court
       resolves the question of coverage. By comparing the allegations
       to the insurance policy provisions, we determine whether, if the
       allegations are sustained, the insurer would be required to pay
       [a] resulting judgment[.]

             The question of whether a claim against an insured is
       potentially covered is answered by comparing the four corners of
       the insurance contract to the four corners of the complaint.[9]

Kiely on Behalf of Feinstein v. Philadelphia Contributionship Ins. Co.,

206 A.3d 1140, 1145–46 (Pa. Super. 2019) (citations, quotation marks and

emphasis in the original omitted).

       In this case, the trial court concluded that,

       after applying the four corners rule to the [A]mended
       [C]omplaint in Hammell and after liberally construing and
       accepting as true its factual allegations, we find that Verizon and
       Parkside are not entitled to coverage by [] Penn National. There
       is simply no suggestion in the Amended Complaint or any other
       pleading, that Precision can be blamed for an act or omission
       that caused [] Hammell’s injuries. As defined in [the P]olicy,
       there are no additional insureds [] and therefore no duty to
       defend either Verizon or Parkside.

____________________________________________


9 Looking beyond the four corners of the complaint, such as considering
extrinsic evidence, is prohibited and departs “from the well-established
precedent … requiring that an insurer’s duty to defend and indemnify be
determined solely from the language of the complaint against the insured.”
Kvaerner Metals Div. of Kvaerner U.S., Inc. v. Commercial Union Ins.
Co., 908 A.2d 888, 896 (Pa. 2006).




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           To trigger additional insured coverage under the [P]olicy,
     the [Amended C]omplaint needed to allege, at the very least,
     that [] Hammell’s bodily injuries were caused, in whole or in
     part, by Precision, or by someone acting on Precision’s behalf,
     such as an agent. The Amended Complaint only claims Parkside
     and Verizon had a duty to protect [] Hammell because he was an
     employee of an unnamed company which may have somehow
     been responsible for dangerous conditions. But in the underlying
     case, [] Hammell [] never names Precision specifically or alleges
     anything cognizable about Precision’s conduct that might have
     been at fault. What [Precision] alleges in the underlying case is
     not enough, and Penn [National’s] duty to defend or indemnify is
     not activated. … Precision relies on language at Paragraph [10]
     of the Amended Complaint. In pertinent part, Paragraph 10
     reads as follows:

           “...defendants...had a duty to protect workers of
           Precision [] from unreasonably dangerous conditions
           caused by its conduct and/or failure to act.”

     (Italics added).

           Precision relies on the pronoun “its” to expose Precision to
     potential liability for [] Hammell’s injuries. While Paragraph 10
     lays on “defendants[,” which include Parkside and Verizon,] a
     duty to protect workers like Hammell from dangerous conditions
     caused by Precision, palpably missing is any allegation that
     Precision actually caused such dangerous conditions in the first
     place. Moreover, Precision cannot be one of the “defendants”
     described in Paragraph 10 as Precision is not a defendant party
     in Hammell.

                                   ***

           Since Precision is neither a named defendant nor otherwise
     implicated in Hammell [], Penn National does not have a duty to
     defend Verizon and Parkside as additional insureds.11
           ______
           11 Since th[e trial] court finds that there is no duty to

           defend, the remaining claim for breach of contract also
           fails. There is also no duty to indemnify.




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Trial Court Memorandum Opinion, 2/8/2019, at 6-8 (some citations and

footnotes omitted).10 Upon review, we conclude that such a narrow reading

of the Amended Complaint by the trial court constitutes reversible error.

             An insurer may not justifiably refuse to defend a claim
       against its insured unless it is clear from an examination of the
       allegations in the complaint and the language of the policy that
       the claim does not potentially come within the coverage of the
       policy. See [] Springfield Tp. et al. v. Indemnity Ins. Co. of
       North America, [64 A.2d 761 (Pa. 1949)] (“It is not the actual
       details of the injury, but the nature of the claim which
       determines whether the insurer is required to defend.”). In
       making this determination, the factual allegations of the
       underlying complaint against the insured are to be taken as true
       and liberally construed in favor of the insured. Indeed, the duty
       to defend is not limited to meritorious actions; it even extends to
____________________________________________


10 Additionally, the trial court found that the two cases cited by Precision,
Ramara and Zurich American Ins. Co. v. Indian Harbor Insurance
Company, 235 F.Supp. 699 (ED.Pa. 2017), were distinguishable from the
instant matter. See Trial Court Memorandum Opinion, 2/8/2019, at at 7
(finding that, in Ramara, the underlying complaint “specifically alleges that
the injured worker’s employer was an independent contractor who through
its agents, ‘failed to adequately inspect and monitor the work performed.’
Agency[,] coupled with specific factual allegation[s,] were enough for the
Ramara Court to find a duty to defend. In contrast, in his underlying
Amended Complaint, [] Hammell did not aver agency nor did he allege
specific conduct or omission by Precision that allegedly contributed to his
injuries.”). See also id. at 8 (finding that, unlike the instant matter, “the
underlying complaint in Zurich American contains allegations that could be
construed to implicate liability of a property owner who had contracted for
window washing services with plaintiff’s employer, LWC City, Inc.” … In
contrast, [] Hammell’s Amended Complaint does not allege any agency
whatsoever between Precision and Parkside (the developer) and makes no
cognizable factual claim that Precision acted as an agent of Verizon. The
relevant averment ambiguously states that Parkside and Verizon “at all
times acted and/or failed to act by and through their respective agents,
servants, workmen and/or employees.” Unlike the averments against
Rittenhouse in Zurich America, there are none in the Hammell Amended
Complaint that lays out negligence by Precision or its agents.”).



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      actions that are “groundless, false, or fraudulent” as long as
      there exists the possibility that the allegations implicate
      coverage.

Am. & Foreign Ins. Co. v. Jerry's Sport Ctr., Inc., 2 A.3d 526, 541 (Pa.

2010) (some citations and quotation marks omitted).          Thus, “[a]s long as

the complaint ‘might or might not’ fall within the policy’s coverage, the

insurance company is obliged to defend.        Accordingly, it is the potential,

rather than the certainty, of a claim falling within the insurance policy that

triggers the insurer’s duty to defend.” Id. (citations omitted).

      Here, the central issue to be resolved is whether the Amended

Complaint alleged sufficiently that Hammell’s injuries were “caused, in

whole, or in part” by Precision’s acts or omissions or by the acts or omissions

of someone acting on Precision’s behalf.       If it did, the additional insured

coverage is triggered and Penn National has a duty to defend Parkside and

Verizon. If the Amended Complaint failed to establish the foregoing, Penn

National would have no obligation to defend these additional insureds. To

make this determination, we compare the scope of coverage set forth in the

Policy to the allegations in the Amended Complaint.

      As set forth supra, the Policy covers additional insureds with respect to

liability for, inter alia, bodily injury, which is caused “in whole or in part” by

Precision’s “acts or omissions” or the “acts or omissions of those acting on”

Precision’s behalf “in the performance of [Precision’s] ongoing operations for

the additional insured(s) at the location or project described in the contract


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or agreement.”      Complaint, 9/20/2017, at Exhibit C. In his Amended

Complaint, Hammell averred, in relevant part, that Verizon and Parkside

“owned, operated, maintained, managed, supervised, possessed and/or

controlled [] premises at or near Villanova, [Pennsylvania.]”          Amended

Complaint, 2/7/2018 at ¶ 7.        Hammell further stated that, during the

relevant period of time there was “a dangerous and hazardous condition in

the nature of a trench at the premises” and that Parkside and Verizon had a

“contractual duty to protect workers at the premises.”          Id. at ¶¶ 8-9.

Hammell claimed he was injured while working for Precision “at or near

Villanova, [Pennsylvania,] when a trench gave way and/or he fell in the

trench, causing him to sustain serious injuries.” Id. at ¶ 16. Most notably,

Hammell asserted that Parkside and Verizon had a duty to protect

employees of Precision, like Hammell, “from unreasonably dangerous

conditions caused by its conduct and/or failure to act.”           Id. at ¶ 10

(emphasis added).

      Reviewing the Policy in conjunction with the Amended Complaint, we

find Hammell’s allegation that Verizon and Parkside had a duty to protect

Precision’s workers from unreasonably dangerous conditions caused by

Precision’s “conduct and/or failure to act” sufficient to trigger Penn National’s

duty to defend Verizon and Parkside as additional insureds. In doing so, we

find, unlike the trial court, the fact that Hammell did not make any overt

allegations of negligence or wrongdoing against Precision, Hammell’s


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employer, does not foreclose Penn National’s duty to defend. Put simply, we

find the Amended Complaint set forth allegations of the existence of

unreasonably dangerous conditions, see Amended Complaint, 2/7/2018, at

¶ 8 (“At all times material hereto, there was a dangerous and hazardous

condition in the nature of a trench at the premises”), and that Verizon and

Parkside had duty to protect Hammell from unreasonably dangerous

conditions caused by Precision’s “conduct and/or failure to act.” Id. at ¶

10. In construing the Amended Complaint liberally, and in favor of the

insured, we find the allegations adequate to establish Penn National’s duty to

defend. See Biborosch v. Transamerica Ins. Co., 603 A.2d 1050, 1052

(Pa. Super. 1992) (“[T]he factual allegations of the complaint are taken to

be true and the complaint is to be liberally construed with all doubts as to

whether the claims may fall within the coverage of the policy to be resolved

in favor of the insured.”).

      Accordingly, we conclude that the Amended Complaint set forth

sufficient averments which triggered Penn National’s duty to defend its third-

party insureds, Parkside and Verizon. Thus, we find that the trial court erred

in granting Penn National’s motion for summary judgment.

      Order granting summary judgment reversed.          Case remanded for

further proceedings. Jurisdiction relinquished.




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Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 12/3/19




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