Appeal from the Circuit Court of Cook County. No. 08 CH 15285 Honorable Peter Flynn, Judge Presiding.
The opinion of the court was delivered by: Justice Robert E. Gordon
JUSTICE ROBERT E. GORDON delivered the judgment of the court, with opinion. Presiding Justice Garcia and Justice McBride concurred in the judgment and opinion.
This appeal arises from a declaratory judgment action filed by plaintiff First Chicago Insurance Company (First Chicago), seeking a declaration that it had no duty to defend or indemnify defendant Michael Molda or his employer, Metrolift, Inc. (Metrolift)*fn1 , in litigation concerning an automobile accident involving Molda and defendant Nola Wilson. The trial court granted First Chicago's motion for summary judgment, finding that First Chicago had not received timely notice of the accident as required by Metrolift's insurance policy. Defendants appeal, claiming that First Chicago had been given timely notice.*fn2 We reverse.
On August 17, 2005, Molda and Wilson were involved in an automobile accident in which Molda, driving a motor vehicle westbound on Roosevelt Road in Broadview, collided with Wilson, driving eastbound on Roosevelt Road. At the time of the accident, Molda was on his way to visit a customer in his capacity as a territorial manager for Metrolift, a company that rented, sold, and repaired construction equipment. Molda was driving his personal automobile because Metrolift did not provide its territorial managers with company automobiles.*fn3 The automobile Molda was driving had only $20,000 in liability coverage.
Unbeknownst to Molda, as a Metrolift employee, he was also covered under Metrolift's insurance policy with First Chicago. First Chicago, formerly known as Chicago Mutual Insurance Company, had issued a policy including liability coverage for automobiles "owned by [Metrolift's] employees or members of their house-holds [sic]" that were being used for business purposes. Section IV(A)(2) of the insurance policy included notice conditions regarding Metrolift's duties in the event of an accident, claim, suit, or loss:
"a. In the event of 'accident', claim, 'suit' or 'loss', you must give us or our authorized representative prompt notice of the 'accident' or 'loss'. Include:
(1) How, when and where the 'accident' or 'loss' occurred;
(2) The 'insured's' name and address; and
(3) To the extent possible, the names and addresses of any injured persons and witnesses.
b. Additionally, you and any other involved 'insured' must: ***
(2) Immediately send us copies of any request, demand, order, notice, summons or legal paper received concerning the claim or 'suit'.
(3) Cooperate with us in the investigation, settlement or defense of the claim or 'suit'."
The term "you" in the insurance policy referred to Metrolift as the named insured; "authorized representative" was not defined.
Metrolift had purchased its insurance policy through Associated Specialty Insurance (Associated), a corporation doing business as an insurance producer. Associated's employee Mark Baskiewicz, a licensed insurance broker for 20 years, was Metrolift's primary contact with the company; on occasion, Metrolift also had contact with Ken South, Associated's president. When Metrolift first sought insurance coverage, Baskiewicz provided the company with a number of quotes from various insurance companies, and Metrolift selected the First Chicago policy; Baskiewicz did not recommend a specific insurer. South testified at his deposition that Associated did not have the right to underwrite First Chicago's policies and did not have the authority to bind their policies. He also testified that First Chicago did not provide Associated with any assistance in obtaining clients, and that Metrolift is now insured through Safeco Insurance. South further testified that his company has a written producers agreement with First Chicago which was not made part of the proceedings in this case.
The First Chicago policy included Associated's name, address, and telephone number listed as the producer. It did not provide any other contact information, nor was any other individual or business other than Metrolift named anywhere within the policy. If a claim was to be made there was no reference to a phone number or person in his representative capacity to contact other than "our authorized representative." When Metrolift had an insurance need or question, Metrolift's treasurer Stephen Harrison contacted Baskiewicz. Harrison had a social as well as business relationship with Baskiewicz. Harrison testified at his deposition that he would normally call Baskiewicz immediately after an incident, and the two would discuss the situation and determine what action to take. If they determined that it was appropriate to file an insurance claim, Baskiewicz would contact the insurance company and obtain a claim number, and Harrison would then be contacted directly by a claim representative of the insurance company. Harrison further testified that he would complete a written narrative accident report of the incident, which he would send to Associated for their review and input, which often included documents such as police reports and photographs. Associated would then forward the accident report to the claim department of the insurance company.
In the case of Molda's accident, Harrison and Metrolift president Rick Dahl became aware of the accident within two days of its occurrence. During that time, Harrison phoned Baskiewicz to discuss the accident. Harrison testified that during the phone call, he and Baskiewicz "discussed the nature of the incident" and developed a "game plan" as to "what [their] next step of action should be." They reached a "joint agreement" that they should "wait and see how the nature of it evolves," primarily ...