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01/13/98 EMTECH MACHINING & GRINDING v. CNA

January 13, 1998

EMTECH MACHINING & GRINDING, INC., PLAINTIFF-APPELLEE,
v.
CNA INSURANCE COMPANIES, DEFENDANT-APPELLANT.



Appeal from the Circuit Court of McHenry County. No. 96--MR--13. Honorable James C. Franz, Judge, Presiding.

The Honorable Justice Inglis delivered the opinion of the court. Geiger, P.j., and Rathje, J., concur.

The opinion of the court was delivered by: Inglis

The Honorable Justice INGLIS delivered the opinion of the court:

Plaintiff, Emtech Machining & Grinding, Inc. (plaintiff or Emtech), filed a verified complaint for declaratory judgment against defendant, CNA Insurance Companies (defendant or CNA), seeking a determination that plaintiff was entitled to reimbursement for $19,693 in attorney fees and other costs incurred in defending against an underlying action for retaliatory discharge brought against plaintiff by a former employee, Randall W. Phelps. Plaintiff averred that it was entitled to reimbursement under a 1991 commercial general liability policy issued by defendant and insuring plaintiff against losses resulting from certain types of "personal injury" defined in the policy.

The parties filed cross-motions for summary judgment. After a hearing on the motions, the circuit court granted judgment to plaintiff and denied judgment to defendant, the effect of which was to require defendant to indemnify plaintiff. Defendant timely appeals. We reverse.

Defendant contends that the trial court erred in finding that the retaliatory discharge claim came within the definition of personal injury stated in the policy. The pleadings and exhibits from the underlying retaliatory discharge action disclose that Emtech's employee, Phelps, filed a complaint against it as a result of the termination of his employment in October 1991. That complaint alleged that, as a result of an injury to his back and foot while working for Emtech, Phelps applied for and received workers' compensation. Phelps further alleged that, in a letter dated October 18, 1991, Emtech informed him that he was discharged as the direct result of his fraudulent misrepresentation to the company regarding whether he had previously filed a workers' compensation claim. Phelps claimed that his discharge from employment violated Illinois public policy, and he sought compensatory and punitive damages from Emtech. It appears that the trial court granted Emtech's motion for summary judgment in the underlying action.

Emtech then filed an action for declaratory judgment, asserting that a claim for retaliatory discharge was one of the torts for which the policy provided indemnification to plaintiff. The specific issue to be decided is whether that claim falls within the policy's definition of personal injury. Section V of the policy states:

"'Personal injury' means injury, other than 'bodily injury', arising out of one or more of the following offenses:

a. False arrest, detention or imprisonment;

b. Malicious prosecution;

c. Wrongful entry into, or eviction of a person from, a room, dwelling or premises that the person occupies;

d. Oral or written publication of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services; or

e. Oral or written publication of material that violates a person's right of privacy."

In reviewing the granting of summary judgment, this court inquires "whether the pleadings, together with all other matters of record, pose any genuine issue of material fact"; if any issue of material fact exists, then the trial court will be deemed to have erred in granting summary judgment. Dixon Distributing Co. v. Hanover Insurance Co., 244 Ill. App. 3d 837, 840, 183 Ill. Dec. 919, 612 N.E.2d 846 (1993). De novo review applies in this case. Crum & Forster Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 390, 189 Ill. Dec. 756, 620 N.E.2d 1073 (1993). It is clear from the face of the underlying complaint that there is no possibility of coverage for retaliatory discharge under the policy in question. ...


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