Appellate
Court of Illinois,
Court of Illinois,
First
District,
THIRD
DIVISION.
THE CITY OF PARK RIDGE, a Municipal Corporation, and HIGH-LEVEL EXCESS POOL,
Plaintiff-Appellant,
Plaintiff-Appellant,
v.
CLARENDON AMERICAN INSURANCE COMPANY, Defendant-Appellee, and
A.G.,
a minor, by her parents and the next friends, MARZENA SASSAK and GREGORY GORMAN
Defendants.
a minor, by her parents and the next friends, MARZENA SASSAK and GREGORY GORMAN
Defendants.
No.
01-17-0453
01-17-0453
October
18, 2017
18, 2017
OPINION
JUSTICE LAVIN delivered the judgment of the court, with opinion.
*1 ¶ 1 This interlocutory
appeal arises from the trial court’s order, granting summary judgment to
defendant Clarendon American Insurance Company (Clarendon). On appeal,
plaintiffs City of Park Ridge (Park Ridge) and its excess carrier, High-Level
Excess Liability Pool (HELP), contend that the trial court erroneously granted
defendant’s motion for summary judgment because the court erred in determining
that emergency medical services fell within the scope of the
“Products-Completed Operations Hazard” provision under the insurance policy,
which affected how much Clarendon would have to pay in two separate claims. We
reverse the trial court’s order of summary judgment in Clarendon’s favor and
remand the case for the trial court to enter summary judgment for plaintiffs
Park Ridge and HELP.
appeal arises from the trial court’s order, granting summary judgment to
defendant Clarendon American Insurance Company (Clarendon). On appeal,
plaintiffs City of Park Ridge (Park Ridge) and its excess carrier, High-Level
Excess Liability Pool (HELP), contend that the trial court erroneously granted
defendant’s motion for summary judgment because the court erred in determining
that emergency medical services fell within the scope of the
“Products-Completed Operations Hazard” provision under the insurance policy,
which affected how much Clarendon would have to pay in two separate claims. We
reverse the trial court’s order of summary judgment in Clarendon’s favor and
remand the case for the trial court to enter summary judgment for plaintiffs
Park Ridge and HELP.
¶
2 BACKGROUND
2 BACKGROUND
¶ 3 This insurance dispute
arises out of monies paid to two plaintiffs who sued Park Ridge for two separate occurrences. In the first, defendants
Marzena Sassak and Gregory Gorman sued in federal court after a confrontational
traffic stop ended in personal injury. After a later, but related, suit was
filed on behalf of their minor child, Gorman settled his case for an amount in
excess of $600,000, the first $250,000 of which was paid by Park Ridge because it had a self-insured retention in that amount. The remainder was paid
by Clarendon.
arises out of monies paid to two plaintiffs who sued Park Ridge for two separate occurrences. In the first, defendants
Marzena Sassak and Gregory Gorman sued in federal court after a confrontational
traffic stop ended in personal injury. After a later, but related, suit was
filed on behalf of their minor child, Gorman settled his case for an amount in
excess of $600,000, the first $250,000 of which was paid by Park Ridge because it had a self-insured retention in that amount. The remainder was paid
by Clarendon.
¶ 4 The second lawsuit involved allegations that Park Ridge paramedics failed to provide any treatment whatsoever
to a 15-year-old boy whose father summoned paramedics when he was found to be
unresponsive around 1:10 a.m. Some hours later, the paramedics were summoned
again, when the boy was unresponsive and blue. He was transported to the
hospital where he was diagnosed as brain dead owing to a drug overdose. He
later died.
to a 15-year-old boy whose father summoned paramedics when he was found to be
unresponsive around 1:10 a.m. Some hours later, the paramedics were summoned
again, when the boy was unresponsive and blue. He was transported to the
hospital where he was diagnosed as brain dead owing to a drug overdose. He
later died.
¶ 5 The deceased boy’s mother, Jo Ann Abruzzo, filed a survival action
and wrongful death action, which was dismissed by the trial court. The
dismissal was affirmed by the appellate court, only to be reversed by the
Illinois Supreme Court. The court determined that the Emergency Medical
Services (EMS) Systems Act (EMS Act) (210 ILCS 50/3.150(a) (West 2004)) applied
to plaintiff’s allegations rather than sections of the Local Governmental and
Governmental Employees Tort Immunity Act (Tort Immunity Act) (745 ILCS
10/6-105, 6-106(a) (West 2004)) and remanded the case for further proceedings.
Abruzzo v. City of Park Ridge, 231 Ill. 2d 324, 348 (2008). All of these legal
peregrinations are fully explicated in our opinion which affirmed the jury’s
subsequent verdict of $5,187,500. See Abruzzo v. City of Park Ridge, 2013 IL
App (1st) 122360. In that opinion, we found that the evidence established a
complete lack of any assessment, diagnosis, treatment, or professional judgment
by the responding emergency medical technicians or paramedics in the first trip
to the family home. Part of that proof involved an admission made by a Park
Ridge lawyer in a reply brief in which the city was claiming immunity because
their paramedics provided “no treatment” at the first stop.
and wrongful death action, which was dismissed by the trial court. The
dismissal was affirmed by the appellate court, only to be reversed by the
Illinois Supreme Court. The court determined that the Emergency Medical
Services (EMS) Systems Act (EMS Act) (210 ILCS 50/3.150(a) (West 2004)) applied
to plaintiff’s allegations rather than sections of the Local Governmental and
Governmental Employees Tort Immunity Act (Tort Immunity Act) (745 ILCS
10/6-105, 6-106(a) (West 2004)) and remanded the case for further proceedings.
Abruzzo v. City of Park Ridge, 231 Ill. 2d 324, 348 (2008). All of these legal
peregrinations are fully explicated in our opinion which affirmed the jury’s
subsequent verdict of $5,187,500. See Abruzzo v. City of Park Ridge, 2013 IL
App (1st) 122360. In that opinion, we found that the evidence established a
complete lack of any assessment, diagnosis, treatment, or professional judgment
by the responding emergency medical technicians or paramedics in the first trip
to the family home. Part of that proof involved an admission made by a Park
Ridge lawyer in a reply brief in which the city was claiming immunity because
their paramedics provided “no treatment” at the first stop.
*2 ¶ 6 When confronted with the
sizeable judgment affirmed by this court, Park Ridge made efforts to resolve
the Abruzzo case, but ran into resistance from Clarendon, which sought to apply
the monies paid in the Gorman matters to a $2 million aggregate limit in its
policy with the city. After some negotiations, Park Ridge and HELP agreed to
provide the necessary funds to settle the case, while leaving the matter of
Clarendon’s potential contribution to be litigated later, with Park Ridge
claiming that Clarendon was obligated to pay its $2 million “occurrence” limit
and Clarendon claiming that the money paid in the Gorman matter should have
been subtracted from its $2 million “aggregate” limit under another section of
the policy.
sizeable judgment affirmed by this court, Park Ridge made efforts to resolve
the Abruzzo case, but ran into resistance from Clarendon, which sought to apply
the monies paid in the Gorman matters to a $2 million aggregate limit in its
policy with the city. After some negotiations, Park Ridge and HELP agreed to
provide the necessary funds to settle the case, while leaving the matter of
Clarendon’s potential contribution to be litigated later, with Park Ridge
claiming that Clarendon was obligated to pay its $2 million “occurrence” limit
and Clarendon claiming that the money paid in the Gorman matter should have
been subtracted from its $2 million “aggregate” limit under another section of
the policy.
¶
7 The Insurance Litigation
7 The Insurance Litigation
¶ 8 Appellants filed a three-count complaint against Clarendon. Count I
sought declaratory relief that Clarendon was obligated to pay a $2 million
occurrence limit in Abruzzo because
the facts of that case took it out of the “aggregate” limit provided for
“Personal Injury,” “Public Officials’ Errors and Omissions,” or the
“Products-Completed Operations Hazard” as punctiliously detailed in the
relevant policy. Count II claimed a breach of contract owing to the refusal to
pay the $2 million. Count III sought additional monies from Clarendon owing to
its obligation to indemnify and defend Park Ridge in the second Gorman suit,
alleging that the aggregate limit was not fully eroded in Gorman I. Clarendon
filed counterclaims, which were answered by Park Ridge and HELP, and
ultimately, the disputes culminated with dueling motions for summary judgment,
which will be analyzed below.
sought declaratory relief that Clarendon was obligated to pay a $2 million
occurrence limit in Abruzzo because
the facts of that case took it out of the “aggregate” limit provided for
“Personal Injury,” “Public Officials’ Errors and Omissions,” or the
“Products-Completed Operations Hazard” as punctiliously detailed in the
relevant policy. Count II claimed a breach of contract owing to the refusal to
pay the $2 million. Count III sought additional monies from Clarendon owing to
its obligation to indemnify and defend Park Ridge in the second Gorman suit,
alleging that the aggregate limit was not fully eroded in Gorman I. Clarendon
filed counterclaims, which were answered by Park Ridge and HELP, and
ultimately, the disputes culminated with dueling motions for summary judgment,
which will be analyzed below.
¶
9 The Clarendon Policy
9 The Clarendon Policy
¶ 10 We will recite the relevant portions of the Clarendon policy before analyzing
the trial court’s interpretation thereof which led to its contested ruling. The
policy held that:
the trial court’s interpretation thereof which led to its contested ruling. The
policy held that:
“[s]ubject to the
other provisions of this policy, the Company will pay on behalf of the Insured that portion of the
Ultimate Net Loss in excess of the Retained Amount, which the Insured shall have become legally
obligated to pay as damages and related Claims Expense because of Bodily
Injury, Property Damage, Personal Injury or Public Officials’ Errors and
Omissions to which this insurance applies.”
other provisions of this policy, the Company will pay on behalf of the Insured that portion of the
Ultimate Net Loss in excess of the Retained Amount, which the Insured shall have become legally
obligated to pay as damages and related Claims Expense because of Bodily
Injury, Property Damage, Personal Injury or Public Officials’ Errors and
Omissions to which this insurance applies.”
The relevant self-insured retention
was listed as $250,000, and the Ultimate Net Loss specifically included costs
of defense.
was listed as $250,000, and the Ultimate Net Loss specifically included costs
of defense.
¶ 11 Further, the policy separately enumerated the amount of coverage
thusly: “Each Occurrence or Wrongful Act, or Combination of Occurrence and
Wrongful Act: $2,000,000,” while the “Aggregate Limit for Personal Injury
Liability, Products-Completed Operations Hazard and Public Officials’ Errors
and Omissions Combined: $2,000,000.” Among the many definitions within the
policy, and pertinent to our ruling, is the definition of “Incidental Medical
Malpractice,” which included allegations “arising out of emergency professional
medical services rendered or which should have been rendered *** by any duly
qualified medical practitioner, nurse, or technician, employed by or acting on
behalf of the Insured.” In
addition, “personal injury” is defined in the policy as “injury, other than
Bodily Injury or Public Officials’ Errors or Omissions arising out of *** false
arrest, detention, imprisonment [or] Malicious prosecution.”
thusly: “Each Occurrence or Wrongful Act, or Combination of Occurrence and
Wrongful Act: $2,000,000,” while the “Aggregate Limit for Personal Injury
Liability, Products-Completed Operations Hazard and Public Officials’ Errors
and Omissions Combined: $2,000,000.” Among the many definitions within the
policy, and pertinent to our ruling, is the definition of “Incidental Medical
Malpractice,” which included allegations “arising out of emergency professional
medical services rendered or which should have been rendered *** by any duly
qualified medical practitioner, nurse, or technician, employed by or acting on
behalf of the Insured.” In
addition, “personal injury” is defined in the policy as “injury, other than
Bodily Injury or Public Officials’ Errors or Omissions arising out of *** false
arrest, detention, imprisonment [or] Malicious prosecution.”
¶ 12 Another section of the policy that seems particularly focused on
construction-related claims was central to the trial court’s decision. It
states:
construction-related claims was central to the trial court’s decision. It
states:
“N.
Products-Completed Operations Hazard
Products-Completed Operations Hazard
1. Includes all
Bodily Injury and Property Damage occurring away from the premises the Insured owns or rents and arising
out of the Insured’s Product
or the Insured’s Work,
except:
Bodily Injury and Property Damage occurring away from the premises the Insured owns or rents and arising
out of the Insured’s Product
or the Insured’s Work,
except:
a. Products that are
still in the physical possession of the Insured; or
still in the physical possession of the Insured; or
*3 b. Work that
has not yet been completed or abandoned. However, the Insured’s Work will be deemed
completed at the earliest of the following times:
has not yet been completed or abandoned. However, the Insured’s Work will be deemed
completed at the earliest of the following times:
1) When all of the
work called for in the Insured’s contract
has been completed.
work called for in the Insured’s contract
has been completed.
2) When all of the
work to be done at the site has been completed if the Insured’s contract calls for more
work at more than one site.
work to be done at the site has been completed if the Insured’s contract calls for more
work at more than one site.
c. When that part of
the work done at a job site has been put to its intended use by any person or
organization other than another contractor or subcontractor working on the same
project.”
the work done at a job site has been put to its intended use by any person or
organization other than another contractor or subcontractor working on the same
project.”
¶
13 Summary Judgment Proceedings
13 Summary Judgment Proceedings
¶ 14 Along with the policy and the relevant motions and arguments, the
trial court considered our earlier opinion that affirmed the multi-million
dollar judgment. Abruzzo, 2013 IL App (1st) 122360. As briefly
mentioned above, the underlying claim regarded a father who called Park Ridge paramedics to come to his home, where he was having
trouble awakening his 15-year-old child who was known to have a drug problem.
The father, Larry Furio, was able to awaken his child, who told his father that
he hadn’t taken any drugs. Then the paramedics arrived. At that time, Furio
sought to reassure them that his son was okay and that it was probably just
asthma causing his breathing problems. As related above, the paramedics left
without any specific assessment of the patient. They didn’t even take his vital
signs and made no report of their interaction. Hours later, the child was found
unresponsive and ultimately died of a drug overdose.
trial court considered our earlier opinion that affirmed the multi-million
dollar judgment. Abruzzo, 2013 IL App (1st) 122360. As briefly
mentioned above, the underlying claim regarded a father who called Park Ridge paramedics to come to his home, where he was having
trouble awakening his 15-year-old child who was known to have a drug problem.
The father, Larry Furio, was able to awaken his child, who told his father that
he hadn’t taken any drugs. Then the paramedics arrived. At that time, Furio
sought to reassure them that his son was okay and that it was probably just
asthma causing his breathing problems. As related above, the paramedics left
without any specific assessment of the patient. They didn’t even take his vital
signs and made no report of their interaction. Hours later, the child was found
unresponsive and ultimately died of a drug overdose.
¶ 15 The plaintiff’s theory of liability was simply that the paramedics
owed the decedent the duty to examine, assess, and transport him to the
hospital. At trial, Park Ridge was ensnared by its earlier
defense that it was entitled to immunity under the Tort Immunity Act (745 ILCS
10/6-105, 6-106 (West 2004)) because it had “provided no medical care of any
kind, including evaluation, assessment, diagnosis, treatment, or
documentation.” Abruzzo, 2013 IL App (1st) 122360, ¶ 33. This
argument persuaded the supreme court to rule that the city wasn’t entitled to immunity
if it provided no treatment. The case was remanded for trial, where a jury
signed a general verdict, rejecting Park Ridge’s arguments
that the child was responsible for his own death, due to ingestion of
narcotics, and that his father was also to blame for failing to give an
accurate history to the paramedics.
owed the decedent the duty to examine, assess, and transport him to the
hospital. At trial, Park Ridge was ensnared by its earlier
defense that it was entitled to immunity under the Tort Immunity Act (745 ILCS
10/6-105, 6-106 (West 2004)) because it had “provided no medical care of any
kind, including evaluation, assessment, diagnosis, treatment, or
documentation.” Abruzzo, 2013 IL App (1st) 122360, ¶ 33. This
argument persuaded the supreme court to rule that the city wasn’t entitled to immunity
if it provided no treatment. The case was remanded for trial, where a jury
signed a general verdict, rejecting Park Ridge’s arguments
that the child was responsible for his own death, due to ingestion of
narcotics, and that his father was also to blame for failing to give an
accurate history to the paramedics.
¶
16 ANALYSIS
16 ANALYSIS
¶ 17 We review the trial court’s order granting summary judgment de
novo. Weather-Tite, Inc. v. University of St. Francis, 233 Ill.
2d 385, 389 (2009). Summary judgment is proper where the pleadings, admissions,
depositions, and affidavits demonstrate that there is no genuine issue of
material fact and that the movant is entitled to judgment as a matter of
law. Ioerger v. Halverson Construction Co., 232 Ill. 2d 196, 201
(2008); 735 ILCS 5/2-1005 (West 2016). In determining whether a genuine issue
of material fact exists, the court must consider such items strictly against
the movant and liberally in favor of its opponent. Williams v.
Manchester, 228 Ill. 2d 404, 417 (2008).
novo. Weather-Tite, Inc. v. University of St. Francis, 233 Ill.
2d 385, 389 (2009). Summary judgment is proper where the pleadings, admissions,
depositions, and affidavits demonstrate that there is no genuine issue of
material fact and that the movant is entitled to judgment as a matter of
law. Ioerger v. Halverson Construction Co., 232 Ill. 2d 196, 201
(2008); 735 ILCS 5/2-1005 (West 2016). In determining whether a genuine issue
of material fact exists, the court must consider such items strictly against
the movant and liberally in favor of its opponent. Williams v.
Manchester, 228 Ill. 2d 404, 417 (2008).
¶ 18 The construction of an insurance policy and a determination of the rights and
obligations thereunder are questions of law for the court that are appropriate
subjects for disposition by way of summary judgment. Crum & Forster
Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 391 (1993).
Duties of an insured are
controlled by the terms and conditions of its insurance contract. American Country Insurance Co. v. Bruhn, 289
Ill. App. 3d 241, 247 (1997). In construing an insurance policy, the primary function of the court is to
ascertain and enforce the intentions of the parties as expressed in the
agreement. Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d
90, 108 (1992). All provisions of an insurance contract should be read together to determine
whether any ambiguity exists. General Insurance Co. of America v. Robert B. McManus, Inc., 272
Ill. App. 3d 510, 514 (1995). If the words in the policy are unambiguous, a
court must afford them their plain, ordinary, and popular meaning. Insurance Co. of Illinois v.
Stringfield, 292 Ill. App. 3d 471, 473-74 (1997). But if the words in the
policy are susceptible to more than one reasonable interpretation, they are
ambiguous and will be construed in favor of the insured and against the insurer who drafted the policy. Valley
Forge Insurance Co. v.
Swiderski Electronics, Inc., 223 Ill. 2d 352, 363 (2006); Outboard
Marine Corp., 154 Ill. 2d at 108-09.
obligations thereunder are questions of law for the court that are appropriate
subjects for disposition by way of summary judgment. Crum & Forster
Managers Corp. v. Resolution Trust Corp., 156 Ill. 2d 384, 391 (1993).
Duties of an insured are
controlled by the terms and conditions of its insurance contract. American Country Insurance Co. v. Bruhn, 289
Ill. App. 3d 241, 247 (1997). In construing an insurance policy, the primary function of the court is to
ascertain and enforce the intentions of the parties as expressed in the
agreement. Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d
90, 108 (1992). All provisions of an insurance contract should be read together to determine
whether any ambiguity exists. General Insurance Co. of America v. Robert B. McManus, Inc., 272
Ill. App. 3d 510, 514 (1995). If the words in the policy are unambiguous, a
court must afford them their plain, ordinary, and popular meaning. Insurance Co. of Illinois v.
Stringfield, 292 Ill. App. 3d 471, 473-74 (1997). But if the words in the
policy are susceptible to more than one reasonable interpretation, they are
ambiguous and will be construed in favor of the insured and against the insurer who drafted the policy. Valley
Forge Insurance Co. v.
Swiderski Electronics, Inc., 223 Ill. 2d 352, 363 (2006); Outboard
Marine Corp., 154 Ill. 2d at 108-09.
*4 ¶ 19 During the briefing process in the trial court, Clarendon filed a supplementary
brief that focused on the aforementioned “Products-Completed Operations Hazard”
and argued that the City’s “work”
on the struggling child had been “completed” when the paramedics first left the
residence. It was on this basis that the trial court ruled that the “aggregate”
coverage applied. In so doing, it plainly ignored the language in the policy
that directly covered the paramedics’ failure to provide any treatment.
Specifically, in the coverage that was not subject to the aggregate, Clarendon was to pay up to $2
million, per occurrence, for “incidental medical malpractice ***
which should have been rendered *** by any duly qualified medical
practitioner, nurse or technician employed by ***
the Insured.” (Emphases
added.) Thus, the only reasonable construction of this insurance contract is that the
failure to assess, treat, and transport the child by the paramedics and
emergency medical technicians (EMTs) is not subject to the aggregate amount. We
further observe that while the parties only use the term “paramedics” in their
briefs, our supreme court opinion makes it clear that Park Ridge “dispatched a fire engine and an ambulance staffed by
emergency medical technicians (EMTs), paramedics, and firefighters.” Abruzzo,
231 Ill. 2d at 328. Therefore, as the language in the policy related to
“Incidental Medical Malpractice” specifically mentions “duly qualified medical
practitioner[s]” and “technicians,” the presence of paramedics and EMTs
squarely invokes this provision, which is plainly subject to the per
occurrence, not aggregate, coverage.
brief that focused on the aforementioned “Products-Completed Operations Hazard”
and argued that the City’s “work”
on the struggling child had been “completed” when the paramedics first left the
residence. It was on this basis that the trial court ruled that the “aggregate”
coverage applied. In so doing, it plainly ignored the language in the policy
that directly covered the paramedics’ failure to provide any treatment.
Specifically, in the coverage that was not subject to the aggregate, Clarendon was to pay up to $2
million, per occurrence, for “incidental medical malpractice ***
which should have been rendered *** by any duly qualified medical
practitioner, nurse or technician employed by ***
the Insured.” (Emphases
added.) Thus, the only reasonable construction of this insurance contract is that the
failure to assess, treat, and transport the child by the paramedics and
emergency medical technicians (EMTs) is not subject to the aggregate amount. We
further observe that while the parties only use the term “paramedics” in their
briefs, our supreme court opinion makes it clear that Park Ridge “dispatched a fire engine and an ambulance staffed by
emergency medical technicians (EMTs), paramedics, and firefighters.” Abruzzo,
231 Ill. 2d at 328. Therefore, as the language in the policy related to
“Incidental Medical Malpractice” specifically mentions “duly qualified medical
practitioner[s]” and “technicians,” the presence of paramedics and EMTs
squarely invokes this provision, which is plainly subject to the per
occurrence, not aggregate, coverage.
¶ 20 In light of our determination that this is a case of inaction on
the part of Park Ridge’s paramedics and EMTs, we
are unpersuaded by Clarendon’s reliance
on cases finding no liability in the latter instances. Cf. Baker
v. National Interstate Insurance Co.,
103 Cal. Rptr. 3d 565 (Cal. Ct. App. 2009) (where the court concluded that the
“products-completed operations hazard” provision excluded coverage for injuries
arising from the insured’s negligent
work off premises, i.e., the inspection of a bus); State
Auto Property & Casualty Insurance Co.
v. Midwest Computers & More, 147 F. Supp. 2d 1113, 1117 (W.D. Okla.
2001) (where the court determined that the “products-completed operations
hazard” provision provided coverage only if the work was completed, but since
the insured sought
damages for loss of computer data during the time services were still being
provided, the damages were not covered under the policy as the work was still
ongoing).
the part of Park Ridge’s paramedics and EMTs, we
are unpersuaded by Clarendon’s reliance
on cases finding no liability in the latter instances. Cf. Baker
v. National Interstate Insurance Co.,
103 Cal. Rptr. 3d 565 (Cal. Ct. App. 2009) (where the court concluded that the
“products-completed operations hazard” provision excluded coverage for injuries
arising from the insured’s negligent
work off premises, i.e., the inspection of a bus); State
Auto Property & Casualty Insurance Co.
v. Midwest Computers & More, 147 F. Supp. 2d 1113, 1117 (W.D. Okla.
2001) (where the court determined that the “products-completed operations
hazard” provision provided coverage only if the work was completed, but since
the insured sought
damages for loss of computer data during the time services were still being
provided, the damages were not covered under the policy as the work was still
ongoing).
¶ 21 Even if we were to attempt to apply the “Products-Completed
Operations Hazard” language to these circumstances, we would still construe
this provision in favor of the insured as
we must. While Illinois courts have not previously addressed this issue, courts
in other states have held that the term “products-completed operations hazard”
generally applies to construction activities, maintenance, and related trades,
not to professional services, such as EMTs or paramedics. For instance,
in American Red
Cross v. Travelers Indemnity Co. of Rhode Island, 816 F. Supp. 755 (D.D.C.
1993), the district court held that HIV-contaminated blood claims did not fall
within the scope of the “completed operations hazard” provision of the insurance policy, and thus, the
aggregate limit of the provision was inapplicable to the claim because each act
of distribution constituted a separate “occurrence” under the policy. The court
reasoned that the plain language of this provision did not apply to
professional services contracts, such as medical personnel, but was “intended
to apply to construction and maintenance work, such as work performed on the
premises of others by contractors and subcontractors.” Id. at
760; See Visteon Corp. v. National Union Fire Insurance Co. of Pittsburg, PA,
777 F.3d 415, 420-21 (7th Cir. 2015) (the Seventh Circuit noted that most
courts have interpreted “completed operations hazard” narrowly to refer to
“accidents caused by defective workmanship which arise after completion of work
by the insured on
construction or service contracts” (internal quotation marks omitted)); Hydro
Systems, Inc. v. Continental Insurance Co.,
929 F.2d 472, 477 (9th Cir. 1991) (the Ninth Circuit observed that
products-completed operations hazard exclusions generally arise after completion
of work by the insured on
construction or service contracts); Visteon Corp. v. National Union
Fire Insurance Co. of
Pittsburg, PA, 30 F. Supp. 3d 792, 798-99 (S.D. Ind. 2014) (the court
concluded that the references in products-completed operations hazard provision
to “ ‘another contractor or subcontractor’ and ‘job site’ reflect that this
provision is intended to cover offsite contractor work,” not environmental
contamination claims); HVAW v. American Motorists Insurance Co., 968 F. Supp 1178, 1183 (N.D. Tex. 1997)
(the court noted that products-completed operations hazard “generally applies
to construction activities, maintenance, and related trades,” and thus,
the insured’s legal
services did not fall under this provision).
Operations Hazard” language to these circumstances, we would still construe
this provision in favor of the insured as
we must. While Illinois courts have not previously addressed this issue, courts
in other states have held that the term “products-completed operations hazard”
generally applies to construction activities, maintenance, and related trades,
not to professional services, such as EMTs or paramedics. For instance,
in American Red
Cross v. Travelers Indemnity Co. of Rhode Island, 816 F. Supp. 755 (D.D.C.
1993), the district court held that HIV-contaminated blood claims did not fall
within the scope of the “completed operations hazard” provision of the insurance policy, and thus, the
aggregate limit of the provision was inapplicable to the claim because each act
of distribution constituted a separate “occurrence” under the policy. The court
reasoned that the plain language of this provision did not apply to
professional services contracts, such as medical personnel, but was “intended
to apply to construction and maintenance work, such as work performed on the
premises of others by contractors and subcontractors.” Id. at
760; See Visteon Corp. v. National Union Fire Insurance Co. of Pittsburg, PA,
777 F.3d 415, 420-21 (7th Cir. 2015) (the Seventh Circuit noted that most
courts have interpreted “completed operations hazard” narrowly to refer to
“accidents caused by defective workmanship which arise after completion of work
by the insured on
construction or service contracts” (internal quotation marks omitted)); Hydro
Systems, Inc. v. Continental Insurance Co.,
929 F.2d 472, 477 (9th Cir. 1991) (the Ninth Circuit observed that
products-completed operations hazard exclusions generally arise after completion
of work by the insured on
construction or service contracts); Visteon Corp. v. National Union
Fire Insurance Co. of
Pittsburg, PA, 30 F. Supp. 3d 792, 798-99 (S.D. Ind. 2014) (the court
concluded that the references in products-completed operations hazard provision
to “ ‘another contractor or subcontractor’ and ‘job site’ reflect that this
provision is intended to cover offsite contractor work,” not environmental
contamination claims); HVAW v. American Motorists Insurance Co., 968 F. Supp 1178, 1183 (N.D. Tex. 1997)
(the court noted that products-completed operations hazard “generally applies
to construction activities, maintenance, and related trades,” and thus,
the insured’s legal
services did not fall under this provision).
*5 ¶ 22 We find the above case law persuasive and any fair reading
of the “Products-Completed Operations Hazard” provision at issue (which is
specifically included in aggregate coverage) has everything to do with
construction operations undertaken by Park Ridge and
nothing to do with a failure of treatment and transport by their EMTs and
paramedics. Accordingly, the trial court erred in granting summary judgment
to Clarendon.
of the “Products-Completed Operations Hazard” provision at issue (which is
specifically included in aggregate coverage) has everything to do with
construction operations undertaken by Park Ridge and
nothing to do with a failure of treatment and transport by their EMTs and
paramedics. Accordingly, the trial court erred in granting summary judgment
to Clarendon.
¶ 23 CONCLUSION
¶ 24 Based on the foregoing, we reverse the judgment of the circuit
court of Cook County in Clarendon’s favor
and remand the case for the trial court to enter summary judgment for
plaintiffs Park Ridge and HELP.
court of Cook County in Clarendon’s favor
and remand the case for the trial court to enter summary judgment for
plaintiffs Park Ridge and HELP.
¶ 25 Reversed and remanded.