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A and A Market Inc. v. Pekin Insurance Co.

June 30, 1999


The opinion of the court was delivered by: Justice Hall

Appeal from the Circuit Court of Cook County Honorable James V. Hill, Judge Presiding.

the opinion of the court:

Insured A&A Market, Inc. (plaintiff), filed suit against its insurer, Pekin Insurance Company (defendant), alleging breach of contract due to defendant's refusal to pay an insurance claim tendered by plaintiff. The parties cross-motioned for summary judgment. Summary judgment was granted in favor of defendant. On appeal, plaintiff contends that defendant breached its insurance contract by denying coverage where the plain language of such contract provides coverage. For the foregoing reasons, we affirm the judgment of the circuit court.

The following facts are relevant to this appeal. Plaintiff leases a building at 901 W. 55th Street, Countryside, Illinois. Plaintiff operates a gas station/convenience store from the premises. The gas pumps are owned by the lessor and are bolted onto a concrete island in the ground. The pumps were attached to the ground, by the lessor, for the purpose of operating a gas station.

Defendant is a domestic corporation authorized by the Department of Insurance of the State of Illinois to issue insurance policies covering all risks of direct physical loss. Defendant issued to plaintiff a business owner's policy of insurance effective October 5, 1995. The policy was valid for one year. The policy provided coverage for plaintiff's business personal property with a limit of $100,000. It is undisputed that the policy did not provide coverage for the building.

On December 10, 1995, a motor vehicle accident occurred at an intersection near the premises. A tire from one of the vehicles involved in the accident hit a gas pump located on plaintiff's premises, causing substantial damage to the gas pump.

Plaintiff submitted a claim to defendant seeking coverage under the policy for its losses. Plaintiff sought monies in the sum total of $17,946.82 ($16,400.76 for property damage and $1,546.06 for loss of business income). Defendant denied coverage of the claim because the gas pumps were not covered property under the terms of the policy. Plaintiff filed suit against defendant for breach of contract.

Defendant filed a motion for summary judgment. Defendant contended that the policy did not provide coverage for plaintiff's losses because the gas pump was a fixture, and fixtures were only covered under the "Buildings" coverage afforded by the policy. Defendant further contended that plaintiff did not have insurance coverage for the building; thus, defendant was not liable for plaintiff's losses.

Plaintiff cross-motioned for summary judgment. Plaintiff contended that its losses were covered under the policy because the policy provided coverage for property of others within 100 feet of the building in plaintiff's care, custody, or control. Plaintiff further contended that the gas pump was: (1) the property of another person (the lessor); (2) within 100 feet of the building; and (3) in plaintiff's care, custody, or control at the time of the loss. The trial court granted defendant's motion for summary judgment. This appeal followed.

The construction of an insurance policy and a determination of the rights and obligations thereunder are questions of law for the court to determine. Crum & Forster Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 620 N.E.2d 1073 (1993). In such cases, Disposition by way of summary judgment is appropriate. Crum & Forster Managers Corp., 156 Ill. 2d at 384. The standard of review is de novo. Laycock v. American Family Mutual Insurance Co., 289 Ill. App. 3d 264, 266, 682 N.E.2d 382 (1997). In Illinois, if the terms of the policy are clear and unambiguous, they must be given their plain and ordinary meaning. Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90, 108, 607 N.E.2d 1204 (1992). Only where it is clearly apparent that the claim is beyond policy coverage can the insurer justifiably refuse payment. La Rotunda v. Royal Globe Insurance Co., 87 Ill. App. 3d 446, 451, 408 N.E.2d 928 (1980).

The insurance policy issued to plaintiff provides coverage for business personal property only. The insurance policy defines particular categories of coverage and provides in pertinent part:

"A. Coverage

1. Covered Property

a. Buildings, meaning the buildings and structures at the premises described in the ...

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