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Consumers Const. Co. v. American Motorists Ins.

DECEMBER 31, 1969.

CONSUMERS CONSTRUCTION COMPANY, A CORPORATION, PLAINTIFF-APPELLANT,

v.

AMERICAN MOTORISTS INSURANCE COMPANY, A CORPORATION, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Kane County, Sixteenth Judicial Circuit; the Hon. CHARLES G. SEIDEL, Judge, presiding. Judgment affirmed.

PRESIDING JUSTICE THOMAS J. MORAN DELIVERED THE OPINION OF THE COURT. This is an appeal from a declaratory judgment action brought by the plaintiff, Consumers Construction Company, against the defendant, American Motorists Insurance Company. The trial court entered judgment for the defendant and denied the plaintiff's post trial motion. The plaintiff appeals both rulings.

Plaintiff entered into a contract on April 2, 1962, with the Board of Education of School District No. 46 (Board) to construct an elementary school. The construction was completed on November 15, 1962. Prior to the contract, the defendant issued a Comprehensive General Liability Policy providing coverage to the plaintiff. A certificate of insurance, requested by the Board, was issued to it.

On August 20, 1965, the Board filed a complaint against the plaintiff which charged:

"5. That at divers times during the period of construction the defendant[*] and its subcontractors whose acts and omissions for which the defendant[*] is responsible under the terms of said contract, violated same by various acts and omissions contrary to the plans and specifications therein referred to, made a part thereof and provided for by the . . . architect or in the alternative, failed to construct said school in a good and workmanlike manner, to wit:

"(a) Employed subcontractors who were inexperienced in the work they undertook to perform.

"(b) Improperly constructed the caissons supporting the building.

"(c) Omitted the hangers that were to be provided under the cement slab for the support of various piping facilities.

"(d) Improperly supervised and directed various employees and subcontractors." * (Plaintiff herein)

On March 28, 1967, plaintiff filed a complaint for declaratory judgment against the defendant alleging the issuance of the policy; the issuance of the certificate of insurance; the contract between the Board and the plaintiff; completion of the work; the instigation of the suit by the Board; the tender of the defense of that suit to the defendant; the refusal of the defendant to defend and the denial of coverage by the defendant.

Defendant answered the charges of the complaint and denied that their refusal to defend or provide coverage was contrary to the policy, and, by a subsequent and further defense asserted that certain exclusions in the policy specifically excluded the claim asserted in the Board's complaint against the plaintiff.

The Board was allowed to intervene but such intervention has no effect upon the present questions since no appeal has been taken by it. It appears from the record that the court decided the case upon the basis of the pleadings, exhibits admitted by the court, a comprehensive memorandum of law filed by the parties and the arguments of counsel. Being so advised, the court found and ordered that defendant had no duty to defend plaintiff in the Board's case, and that the policy in question provided no coverage to plaintiff under the allegations of that complaint.

The policy in question is composed of four pages of insuring agreements, a declaration page, two rating schedule pages, and 21 endorsements or amendments. It is complex; however, those portions pertinent to these proceedings are:

"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, ...


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