Insurer Must Defend Party Who is Additional Insured under Policy
In Pekin Insurance v. Prince Contractors Inc., Robert Rybaltowski (“Rybaltowski”), filed a lawsuit against Chicago Masonry Construction, Inc. (“Chicago Masonry”), Prince Contractors, Inc. (“Prince”), and 4929 Forest LLC (“Forest”) and alleged that their various negligent acts caused him to be struck and injured by certain masonry equipment as it was being lifted by Paszki Masonry Inc. (“Paszki”) at a job site located at 4929 Forest Avenue in Downers Grove, Illinois. Forest and Prince tendered their defense to Pekin Insurance Company (“Pekin”), claiming they were covered as additional insureds under an insurance policy Pekin issued to Chicago Masonry. Pekin filed a declaratory judgment action, seeking a declaration that it had no duty to defend either Forest or Prince. In Rybaltowski’s complaint, he alleges that he was employed by a contractor doing business as Rain Coat Solutions; and in the course of his employment, performed work at 4929 Forest Avenue, Downers Grove, Illinois. Rybaltowski further alleges that Prince and Forest were contracted to serve as a construction manager and general contractor for the project Chicago Masonry subcontracted, with Prince to serve as supervising masonry contractor for the project. Pekin issued a commercial general liability insurance policy to Chicago Masonry as named insured. The insurance endorsement provides as follows: “1. Who Is An Insured (Section II) is amended to include as an insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy. Such person or organization is an additional insured only with respect to liability incurred solely as a result of some act or omission of the named insured and not for its own independent negligence or statutory violation.” In its contract with Prince, Chicago Masonry agreed to name Prince and Forest as additional insureds. Rybaltowski alleged that Chicago Masonry, Forest, and Prince each retained control of supervision of the work at the job site, were in charge of safety at the job site, and had in place safety programs that were in full force and effect at the job site. Allegedly, they each had the right to stop the work for safety violations, conducted safety meetings at the job site, employed safe practices, and corrected any safety violations.
The court addressed the question of whether an insurer must defend a party that is an additional insured under the policy. The court determined that the duty to defend exists here because, under a liberal construction given to the facts alleged in the underlying Rybaltowski complaint, there is at least one scenario in which Prince may be found vicariously liable solely for Chicago Masonry’s negligence, giving rise to coverage under the additional insured endorsement to the Pekin policy. They looked at Prince’s role in retaining control over the manner in which Chicago Masonry performed its work. In Rybaltowski’s complaint, he more than simply alleged that Prince retained the power to coordinate the order in which the work was done, but rather that Prince retained the broader supervisory power over all the work performed at the job site. Also, the Rybaltowski complaint alleged more than simply that Prince could stop work that was performed dangerously, but rather that Prince retained authority over maintaining safety at the job site, which it exercised by implementing safety programs, conducting safety meetings, and by employing safety specialists to walk the job site to assure safe practices were followed and to correct safety violations. These allegations, when liberally construed in favor of Prince, were sufficient to indicate that Prince retained control over the manner in which Chicago Masonry performed its work, raising the possibility that Prince could be found vicariously liable solely for Chicago Masonry’s acts or omissions. Accordingly, Prince is covered as an additional insured, and Pekin owes a duty to defend.
The court found that Pekin owed a duty to defend Prince, as an additional insured under a policy issued to Chicago Masonry, and was affirmed where the underlying complaint against Prince alleged facts, bringing the case potentially within policy coverage.
Pekin Insurance v. Prince Contractors Inc., 2012 WL 6963538 (Ill. App. 1 Dist. 2012).
