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J.l. Simmons Co. v. Lumbermens Mut. Ins. Co.

MAY 23, 1967.




Appeal from the Circuit Court of Cook County; the Hon. DONALD J. O'BRIEN, Judge, presiding. Affirmed.


This is an appeal from the entry of a judgment in a bench trial against the plaintiff-appellant, J.L. Simmons Company, at the close of its case. Subsequent to the entry of such judgment, plaintiff made a motion to vacate the judgment, or in the alternative, to grant a new trial, which motion was denied and from which this appeal is taken.

Plaintiff's cause was founded exclusively upon the terms of a contract of liability insurance it held as the insured with the defendant-appellee, Lumbermens Mutual Insurance Company. The effective dates of the policy in question were July 1, 1955, to July 1, 1956. Plaintiff is a construction company and was in the month of October, 1955, engaged in the excavation of certain land owned by the Illinois Farm Supply Company (hereinafter referred to as Illinois Farm) in Springfield, Illinois. On October 5th and 6th, 1955, an unseasonably large quantity of rain fell in the Springfield area. Due to the rain, unanticipated underground hydrostatic pressures developed which began to buckle the existing shoring in the excavation. The walls of the excavation threatened to collapse and thereby place a warehouse structure on the immediately adjoining property in imminent peril. The adjoining property and structure were also owned by Illinois Farm.

During the course of the rainfall, plaintiff's insurance manager, Mr. Fusch, telephoned defendant's salesman, Mr. O'Rear, to inform him of the emergency situation. Defendant's agent, upon learning of the impending collapse, told Fusch to keep him advised, but otherwise took no affirmative action. Thereafter, plaintiff proceeded to secure and install emergency bracing against the pilings which had theretofore been in place. The preventative reinforcing measure successfully provided the lateral support needed to withstand the increased pressure. The adjacent subsoil beneath the warehouse did not collapse, although some settling and cracking damage to that structure did result.

Plaintiff maintains that it incurred, at cost and without a profit, approximately $13,000 in expenses to secure and erect the additional bracing, as well as $5,000 in expenses to repair the damage to the warehouse. Defendant argues that the evidence offered failed to sustain plaintiff's allegation of expenditures. Plaintiff concedes, that while the exact amount of damage is disputed, some damage has nonetheless been established by the evidence. Illinois Farm has never instituted a claim against plaintiff relative to this occurrence. Written notice of plaintiff's claim for reimbursement was not sent to defendant until October 3, 1956, almost a year after the events which gave rise to this cause of action.

Plaintiff contends defendant was and is obligated to reimburse it for such sums so expended pursuant to the terms of their contract of insurance. Plaintiff attached a copy of the contract to its complaint. Defendant admits the existence of the policy but denies liability on the basis of the contract's express language.

It is plaintiff's sole theory of the case that as an excavator it owed an absolute duty to the adjoining property owner not to remove its property's lateral and subjacent support. This absolute duty having been shown to exist, plaintiff maintains that the monies expended by it represented a sum which it was legally obligated to pay as damages within the meaning of the contract of insurance.

It is defendant's theory of the case (1) that plaintiff has failed to show that it became legally obligated to pay damages within the meaning of the policy's coverage, (2) that plaintiff has failed to comply with conditions 8 and 11 of said policy, and (3) that plaintiff's claim is excluded as a basis of liability by Endorsement K of the policy.

The insurance contract was amended by at least eighteen subsequent endorsements which each recite the same effective dates as that of the parent policy. While numerous provisions of both the parent policy and its subsequent endorsements have been called into question, we are of the opinion that only the following clauses are applicable to the disposition of this appeal, to wit:

Coverage B — Property Damage Liability

To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of property, including the loss of use thereof, caused by accident.

Condition 8 — Notice of Accident

When an accident occurs written notice shall be given by or on behalf of the insured to the company or any of its ...

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