No. 07 CH 16976 Appeal from the Circuit Court of Cook County. Honorable James R. Epstein, Judge Presiding.
The opinion of the court was delivered by: Justice O'brien
JUSTICE O'BRIEN delivered the judgment of the court, with opinion.
Presiding Justice Gallagher and Justice Lavin concurred in the judgment and opinion.
This appeal arises from an insurance coverage lawsuit in which plaintiff, Federal Insurance Company (Federal), sought to recover from defendant, Lexington Insurance Company (Lexington), settlement payments made by Federal on behalf of its insured in a personal injury action. The circuit court held that the insured's failure to comply with the "Notice of Circumstance" provision precluded coverage under the Lexington policy and granted summary judgment in favor of Lexington. On appeal, Federal contends the circuit court erred in granting summary judgment to Lexington because sufficient notice was provided as outlined in the insurance policy. We affirm.
We adopt the facts as outlined in the judgment of the circuit court.
In October 1998, Jose Barajas was seriously injured by a detonator manufactured by the Ensign-Bickford Company (Ensign) and sold by American East Explosives, Inc. (American East). American East, doing business then as Evenson Explosives, is a subsidiary of ETI Canada, Inc.
No 1-09-3296 (ETI). At the time of the accident, American East and Ensign were insured by National Union Fire Insurance Company (National Union). Defendant Lexington was their excess carrier from November 29, 1997, through November 29, 1998, and plaintiff, Federal, provided excess coverage from November 29, 1998, through November 29, 1999.
On April 18, 2000, Barajas and his spouse filed suit against American East, Ensign, and others, for his injuries. National Union agreed to defend American East and Ensign, and Federal agreed to provide excess coverage. Lexington refused to participate, contending the Barajas claim was not covered under its policy. Once the Barajas litigation settled, Federal filed the instant lawsuit seeking to recover its portion of the settlement from Lexington.
The parties filed cross-motions for summary judgment on Federal's four-count complaint for declaratory relief, indemnification, breach of contract damages, and contribution. The circuit court granted Lexington summary judgment on the four-count complaint and denied summary judgment to Federal. Federal filed this timely appeal.
At issue is the notice of circumstance in Lexington's policy:
"Whenever the Insured has information relating to a Circumstance which is likely to involve this Policy and gives notice of such Circumstance, in writing, sent by registered or certified mail during the period of this Policy, to the entity designated in Item 4 of the Declarations, then any claim, as respects such Circumstance, which is made, in writing, against the Insured within seven years from the date of the written notification of such Circumstance, to said entity, shall be deemed to have been first made, in writing, against the Insured on the date upon which the notice of the said Circumstance was first sent to No 1-09-3296 said entity, in writing.
It is noted that this Insuring Agreement 4 is an option for the Insured and not an obligation and does not alter the provisions of Condition (D)-REPORTING OF LOSSES." (Emphasis added.)
Willis Corroon Corporation of Seattle (Willis) is the entity designated in Item 4. At the time of the Barajas accident, Willis also was American East's broker in charge of handling all of American East's general and auto liability claims and the reporting of all those after being notified.
It is undisputed American East did not provide Willis with written notification of the Barajas incident. American East's administrative and risk manager, Carl Clauss, did telephone Willis's representative, Stanley Heydrick, on the day of the incident or the day after and notified him of the incident. Heydrick does not remember requesting written notice of the Barajas accident, but believes he forwarded the Barajas information to Mr. Jim Sorte in the claims department, which then put National Union, the primary insurer, on notice.
The learned trial court correctly stated the standard. "The construction of an insurance policy and a determination of the rights and obligations thereunder are questions of law for the court which are appropriate subjects for disposition by way of summary judgment." Crum & Forster Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 391 (1993). Summary judgment should be granted only where the pleadings, depositions, admissions and affidavits, viewed in the light most favorable to the non-movant, show that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law. The Film & Tape Works, Inc. v. Junetwenty Films, Inc., 368 Ill. App. 3d 462, 468 (2006). While summary judgment may aid the expeditious disposition of a lawsuit, it is a drastic means of disposing of litigation and therefore should be allowed only when the right of the moving party is clear and free from doubt. Purtill v. Hess, 111 Ill. 2d 229, 240 (1986). When parties file cross-motions for summary judgment, they concede the absence of a genuine issue of material fact and invite the court to decide the questions presented as a matter of law. Steadfast Insurance Co. v. Caremark Rx, Inc., 359 Ill. App. 3d 749, 755 (2005). Our review is de novo. Steadfast Insurance Co., 359 Ill. App. 3d at 755.
A proper analysis of the sufficiency of notice is whether the notice given objectively complied with the potential claim notice provision of a policy. Continental Casualty Co. v. Coregis ...