General Liability Defense : Chicago General Liability Lawyer & Attorney : Mark McAndrew : Hennessy & Roach Law Firm : Civil Defense Litigation, Damages : Illinois, Wisconsin, Midwest

United Automobile Insurance Company (United)www.unitedautoinsurance.com insured Rodney Buckley whose car collided with Hal Haywood’s car. Haywood filed a personal injury suit. After Buckley did not appear at an arbitration hearing, an award was entered in Haywood’s favor. The decision stated that Buckley “did not participate in good faith.” United filed a notice to reject the award arguing that Buckley’s failure to appear was inadvertent. Ultimately, Buckley was barred from rejecting the arbitration award against him for failure to appear at the arbitration hearing.

To collect his judgment, Haywood brought garnishment proceedings against United. United filed a declaratory judgment arguing that Buckley was not covered under the policy because he breached the assistance and cooperation policy provision by failing to appear at the arbitration hearing.  Haywood then counter-argued that Buckley’s failure to appear was inadvertent and that Buckley cooperated. The court found that Buckley had not breached his contractual duty to cooperate. United appealed.The appellate court affirmed.  United Automobile Insurance Company v. Buckley, et al. 2011 IL App (1st) 103666.  To show breach of a cooperation clause, the general rule is that the insurer must show that it exercised a reasonable degree of diligence in seeking the insured’s participation. The insurer will not be relieved unless it proves its defense was substantially prejudiced by the insured actions or conduct. 

The Appellate Court looked at the record which showed that Buckley participated in the court proceedings, assisted in the discovery process, and regularly commnunicated with counsel. And thus the trial court's decision that Mr. Buckley did not wilfully refuse to cooperate was not against the weight of the evidence.  More so, United was not substantially prejudiced because Buckley’s absence did not prevent United from challenging damages evidence or from cross-examining Haywood.  

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The plaintiff,  Paul Swearingen, was a truck driver, who delivered a tanker full of chemicals to the defendant, Momentive Specialty Chemicals ww2.momentive.com/home.aspx.  Swearingen parked in the unloading bay, and Momentive asked him to open the dome lid on the top of his truck.  No one from Momentive was present to provide instructions to Swearingen.  Swearingen admitted that his employer had trained him to retain three points of contact on the truck when opening the lid.  He was aware that he was not wearing a safety harness, and  that there was a low, exposed fire suppression system pipe.  Nevertheless, Swearingen climbed on top of the truck stood up, hit is head on the pipe, fell and was injured.      

Swearingen’s complaint alleged  that Momentive breached its duty by failing to warn him of the risk associated with the pipe and by failing to provide him with a fall protection harness.  Generally, a landowner owes a business invitee “the duty of exercising ordinary and reasonable care to see that the premises are reasonably safe.”  Momentive’s motion for summary judgment was granted after it had argued that the hazard was “open and obvious” and that Momentive had no duty to Swearingen. 

On appeal, Swearingen argued in response to the “open and obvious” condition that the “deliberate encounter exception” should have been applied.  The 7^th Circuit disagreed and affirmed the district court decision.  Swearingen v. Momentive Specialty Chemicals Inc., No. 11-2088  (Dec. 7, 2011).  "Under that exception, even if an invitee harms himself on an open and obvious hazard, the landowner may still be liable if he had reason to expect that the invitee would deliberately encounter the hazard because the advantages of doing so outweigh the apparent risk to a reasonable person."  The court explained, here, Swearingen had been trained by his employer in the correct way to open the lid; however, he did not open it correctly.  Overall, there was no evidence that Momentive had reason to expect that Swearingen would have climbed up to deliberately encounter the pipe in such a way.  The court concluded, under Illinois law, that Momentive did not have a duty because the injury was neither foreseeable nor likely, and the burden on the defendant to guard against the injury would be substantial. 

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Passengers in a minivan were injured in a two-car collision. The passengers sued both drivers of the vehicles. The jury found no negligence on the part of both drivers. The judge granted the passengers’ motion for retrial concluding “the jury’s finding…is unreasonable and against the manifest weight of evidence…” The defendants appealed the order for retrial.   The Appellate Court, 1^st District reversed because “the jury could have found that the passengers failed to prove by a preponderance of the evidence that the drivers were negligent.” The verdicts were also not legally inconsistent or against the manifest weight of evidence.   Anderson v.Anderson, 2011 IL App (1st) 110034 (Sep. 30, 2011).

The court stated since this case involved plaintiffs suing multiple potential tortfeasers, the burdens of proof between innocent, injured parties must be discussed. This raises the “doctrine of alternative liability,” which the Illinois Supreme Court has adopted. Smith v. Eli Lilly & Co., 137 lll.2d 222 (1990).   Alternative liability may apply when two or more defendants act tortiously toward a plaintiff who, through no fault of her own, cannot identify which one of the joint defendants cause the injury. The burden of proof then shifts to each defendant to prove his innocence with respect to causation. However, the innocent plaintiff still must prove that each tortfeasor was negligent before the burden will shift. Wyscocki v. Reed, 222 Ill. App. 3d 268 (1991). 

Here, because the jury did not find negligence on the part of the drivers and because the jury could have found that that the plaintiffs failed to prove the negligence of both defendants, the use of the doctrine of alternative liability was unavailable.  

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Walsh Construction was the general contractor for an Illinois water reclamation district construction project. Luise, Inc. was a subcontractor of Walsh. Walsh requested coverage as an additional insured under Luise’s liability insurance policy, which was purchased from Scottsdale Insurance Company.   The language for the additional insured provision excluded coverage for accidents “arising out of the sole negligence of the additional insured.” A Walsh employee backed a bulldozer into Luise’s dump truck. The employee driving the truck sued Walsh and the water district but later dropped the water district from its claim. Scottsdale sued for declaratory judgment in federal district court arguing that there was no duty to defend Walsh because of the sole negligence exclusion. Subsequently, Walsh filed a third party complaint for contribution against Luise. The district court granted summary judgment against Walsh, concluding that Scottsdale was not obligated to defend Walsh.  Scottsdale Ins. Co. v. Walsh Const. Co., No. 10 C 1565 (Sept. 29, 2011). 

Walsh argued that the sole negligence exclusion did not apply because both drivers may have been negligent. Walsh further argued that the employee’s complaint initially included the water district as well. The court stated there is no case law to substantiate an inference that Walsh is not solely negligent just because the water district at one time was named as a defendant.  the court further explained that Walsh’s theories cannot be supported by the employee’s complaint if the complaint does not allege any supporting facts and would cause the court to speculate regarding certain facts as to how the accident occurred. A court will not read into the complaint facts that are not there.   Here, the facts alleged in the complaint were outside the bounds of the policy coverage. 

Walsh also relied on their third-party complaint and testimonial evidence, and argued under Pekin Insurance Company v. Wilson that the Illinois Supreme Court considered a third-party complaint where the insurance policy contained an exception to coverage exclusion provision.  237 Ill.2d 446 (2010).  Here, however, there was no such exception. The district court further went on to say that in L.J. Dodd Construction Company v. Federated Mutual Insurance the court held that a trial court may not look to a third-party complaint absent some unusual or compelling circumstance. Similarly, in National Fire Insurance v. Walsh Construction Company, the court applied the same rule in finding that the facts alleged in the complaint fell squarely into the sole negligence exclusion. 392 Ill. App. 3d 312 (Ill. App. Ct., 1st Dist. 2009) (citing American Economy Ins. Co., v. DePaul University, 383 Ill. App. 3d 172 (2008)) (declining to allow an additional insured to bolster its claim of coverage by referencing its own third-party claim). Here too, Walsh’s testimonial evidence is not entitled to an exception and the complaint is sufficient to find Scottsdale had no duty to defend. 

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