{ "id": 2657680, "name": "CONTINENTAL NATIONAL AMERICA INSURANCE COMPANY et al., Plaintiffs-Appellants, v. AETNA LIFE AND CASUALTY COMPANY et al., Defendants-Appellees", "name_abbreviation": "Continental National America Insurance v. Aetna Life & Casualty Co.", "decision_date": "1989-08-01", "docket_number": "No. 1\u201488\u20141811", "first_page": "891", "last_page": "898", "citations": [ { "type": "official", "cite": "186 Ill. App. 3d 891" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "228 N.E.2d 141", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "84 Ill. App. 2d 200", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 2554043 ], "pin_cites": [ { "page": "206-07" } ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/84/0200-01" ] }, { "cite": "149 N.E. 660", "category": "reporters:state_regional", "reporter": "N.E.", "pin_cites": [ { "page": "662" } ], "opinion_index": 0 }, { "cite": "253 Mass. 610", "category": "reporters:state", "reporter": "Mass.", "case_ids": [ 748016 ], "pin_cites": [ { "page": "616" } ], "opinion_index": 0, "case_paths": [ "/mass/253/0610-01" ] }, { "cite": "157 N.E.2d 570", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "21 Ill. App. 2d 105", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 5197336 ], "pin_cites": [ { "page": "111-12" } ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/21/0105-01" ] }, { "cite": "358 N.W.2d 294", "category": "reporters:state_regional", "reporter": "N.W.2d", "pin_cites": [ { "page": "298-99" } ], "opinion_index": 0 }, { "cite": "120 Wis. 2d 635", "category": "reporters:state", "reporter": "Wis. 2d", "case_ids": [ 8675334 ], "pin_cites": [ { "page": "642-44" } ], "opinion_index": 0, "case_paths": [ "/wis-2d/120/0635-01" ] }, { "cite": "428 N.E.2d 1183", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "102 Ill. App. 3d 24", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3072962 ], "weight": 2, "pin_cites": [ { "page": "26" }, { "page": "26" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/102/0024-01" ] }, { "cite": "804 F.2d 983", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1662721 ], "weight": 3, "opinion_index": 0, "case_paths": [ "/f2d/804/0983-01" ] }, { "cite": "569 F.2d 304", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1423224 ], "year": 1986, "pin_cites": [ { "page": "313" } ], "opinion_index": 0, "case_paths": [ "/f2d/569/0304-01" ] }, { "cite": "523 F. Supp. 1097", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3344438 ], "pin_cites": [ { "page": "1105" } ], "opinion_index": 0, "case_paths": [ "/f-supp/523/1097-01" ] }, { "cite": "133 Ariz. 395", "category": "reporters:state", "reporter": "Ariz.", "case_ids": [ 735378 ], "weight": 3, "year": 1981, "pin_cites": [ { "page": "405-06" }, { "page": "144-45" }, { "page": "140" } ], "opinion_index": 0, "case_paths": [ "/ariz/133/0395-01" ] }, { "cite": "348 F. Supp. 682", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3538263 ], "year": 1982, "pin_cites": [ { "page": "685" } ], "opinion_index": 0, "case_paths": [ "/f-supp/348/0682-01" ] }, { "cite": "182 Ill. App. 3d 898", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 2621397 ], "pin_cites": [ { "page": "902" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/182/0898-01" ] } ], "analysis": { "cardinality": 721, "char_count": 15235, "ocr_confidence": 0.746, "pagerank": { "raw": 1.1453560454155975e-07, "percentile": 0.5800631619835751 }, "sha256": "bd82699a0edc130556209b79d8fa69751bca3ef1e3f5f91ca89eb36aceb92216", "simhash": "1:7f824aff6b5fa681", "word_count": 2388 }, "last_updated": "2023-07-14T21:56:50.889546+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "CONTINENTAL NATIONAL AMERICA INSURANCE COMPANY et al., Plaintiffs-Appellants, v. AETNA LIFE AND CASUALTY COMPANY et al., Defendants-Appellees." ], "opinions": [ { "text": "JUSTICE HARTMAN\ndelivered the opinion of the court:\nWe are asked to review the issue of whether an insurance policy underwritten for the lessor of a truck, or a different insurance policy underwritten for the lessee of the truck, provides coverage for an accident involving the truck. An amended complaint for declaratory judgment and an amended counterclaim seeking the same relief brought this matter to issue, followed by a motion and cross-motion for summary judgment on the issue of which policy applied. The circuit court declared that both policies of insurance provided co-primary coverage for the truck\u2019s lessor, lessee and driver. Plaintiffs/cross-defendants Continental National America Insurance Company and Glen E. Meyer Cartage Company (sometimes collectively CNA) appeal.\nPlaintiff/cross-defendant Glen E. Meyer Cartage Company (Meyer) is an Illinois corporation engaged in the business of transporting \u201cvarious materials\u201d such as dirt, sand and gravel within Illinois. Defendant/counterplaintiff E Smith Cartage, Inc. (Smith), also an Illinois corporation, similarly transports \u201cmaterials\u201d within the State. On March 30, 1983, Smith and Meyer entered into a written agreement whereby Meyer leased to Smith a 1972 Mack truck for three years, and under which they agreed that for the \u201cduration\u201d of the lease the truck would remain in Smith\u2019s \u201cexclusive possession, control, use and responsibility during the periods the vehicle is operated by or for [Smith].\u201d Another paragraph in the agreement obligated Smith to \u201cmaintain and provide insurance coverage for the protection of the public pursuant to the requirements of section 18 \u2014 701 of the Illinois Motor Carrier of Property Law and the requirements of the Illinois Commerce Commission promulgated thereunder.\u201d The lease further provided Smith with a Meyer employee, Junior Martin (Martin), to drive the truck.\nOn June 18, 1984, the leased truck, driven by Martin, collided with an automobile, fatally injuring the automobile\u2019s driver, Michael McLeod (McLeod). The special administrator of McLeod\u2019s estate filed a wrongful death claim in the circuit court of Cook County (McLeod or McLeod claim) and, in his amended complaint filed April 24, 1986, named Smith, Martin and Glenn E. Meyer, owner of Meyer, as defendants.\nCNA, liability insurer for Meyer and Martin, filed a complaint on January 29, 1986, and on September 16, 1986, an amended complaint, for declaratory judgment. CNA, among other things, alleged: it tendered defense of McLeod to defendant/eounterplaintiff Aetna Casualty & Surety Company, liability insurer for Smith (sometimes collectively Aetna); Meyer \u201cenjoyed liability coverage under [Smith\u2019s] policy with Aetna\u201d; and \u201cAetna was the primary insurer of the leased truck under the terms of the lease agreement and the insurance policies,\u201d which Aetna denied and refused to defend McLeod. CNA requested that the circuit court declare Aetna the primary insurer, \u201cobligated to defend *** Martin and Meyer in the suit brought by McLeod\u2019s Administrator\u201d and find CNA the excess insurer for purposes of the McLeod litigation.\nAetna answered the complaint and filed a counterclaim and an amended counterclaim for declaratory judgment in which the first count requested that the circuit court declare neither Martin nor Meyer qualified as insureds under the Aetna policy, relieving Aetna of any burden to defend or indemnify them against allegations raised in McLeod. In count II, Aetna sought a ruling that, with regard to McLeod: CNA and Aetna must bear equally the expenses incurred defending Smith; Meyer\u2019s CNA policy obliges CNA to provide Meyer and Martin with primary coverage; and the Aetna policy purchased by Smith provides no coverage to Meyer.\nCNA moved for summary judgment, to which Aetna responded and filed its own cross-motion for summary judgment. Aetna asked the circuit court in its motion to find CNA the primary insurer of Martin, Smith and Meyer for the McLeod claim. Each party subsequently filed replies in support of their motions and responses to the opposing parties\u2019 objections.\nThe circuit court declared that \u201ceach carrier *** shall bear 50% of the expense involved in defending each defendant in the underlying action and each carrier shall bear 50% of any indemnification obligation which shall arise up to the limits of their respective policies of insurance.\u201d CNA appeals.\nCNA identifies error in the circuit court\u2019s failure to find Aetna obligated to furnish primary coverage to Meyer, Martin and Smith in the McLeod claim and CNA responsible only for excess coverage.\nThe parties stipulated below to the material facts defining this case, including the operative clauses of the insurance contracts and the leasing arrangement between the insureds; this court may decide the issue, therefore, as a matter of law. Rockford Mutual Insurance Co. v. Schuppner (1989), 182 Ill. App. 3d 898, 902.\nCNA initially asserts that Aetna must assume primary coverage because Meyer and Martin each qualify as an \u201cinsured\u201d under the Aetna policy, pursuant to the provisions of Aetna\u2019s \u201cWho Is Insured\u201d clause:\n\u201c2. Anyone else is an insured while using with your permission a covered auto you own, hire or borrow ***.\n4. The owner or anyone else from whom you hire or borrow a covered auto which is not a trailer is an insured while the covered auto:\na. Is being used exclusively in your business, and\nb. Is being used pursuant to operating rights granted to you by a public authority.\u201d\nThat same policy, CNA continues, contains an \u201cOther Insurance\u201d clause, the emphasized terms of which bind Aetna to provide primary coverage for injuries resulting from use of a vehicle \u201chired or borrowed\u201d by Smith:\n\u201c1. This policy\u2019s liability coverage is primary for any covered auto while hired or borrowed by you and used exclusively in your business and pursuant to operating rights granted to you by a public authority. This policy\u2019s liability coverage is excess over any other collectible insurance for any covered auto while hired or borrowed from you by another trucker.\n3. Except as provided in Paragraphs 1 and 2 above, this policy provides primary insurance for any covered auto you own and excess insurance for any covered auto you don\u2019t own.\u201d (Emphasis added.)\nCNA raises as well the \u201cOther Insurance\u201d provision in the CNA policy as proof that the leasing of trucks to others by Meyer requires CNA to provide merely excess insurance.\n\u201c1. This policy\u2019s liability coverage is primary for any covered auto while hired or borrowed by you and used exclusively in your business and over a route or territory, if any, you are authorized to serve by public authority. This policy\u2019s liability coverage is excess over any other collectible insurance for any covered auto while hired or borrowed from you by another trucker.\" (Emphasis added.)\nCNA cites cases in which courts found that certain insurance contract provisions placed responsibility for public safety on the lessee to a lease agreement because the lessee actually controls the vehicle. CNA analogizes the Interstate Commerce Commission (ICC) regulations, which prompted these provisions, to sections of the Illinois Commercial Transportation Law (Ill. Rev. Stat. 1987, ch. 95\u00bd, pars. 18c \u2014 4901, 18c \u2014 4904), requiring Illinois motor carriers to obtain insurance for the protection of the public, and pursuant to which Smith assumed the obligation to provide insurance under the lease. Allstate Insurance Co. v. General Fire & Casualty Co. (E.D. Pa. 1972), 348 F. Supp. 682, 685; Transport Indemnity Co. v. Carolina Casualty Insurance Co. (1982), 133 Ariz. 395, 405-06, 652 P.2d 134, 144-45. See also Mustang Transportation Co. v. Ryder Truck Lines, Inc. (E.D. Pa. 1981), 523 F. Supp. 1097,1105.\nAetna responds that CNA\u2019s attempt to fix the parties\u2019 responsibility through the lease term requiring Smith to obtain insurance improperly binds the insurance carriers to contractual obligations concluded between their insureds and third persons. (Carolina Casualty Insurance Co. v. Underwriters Insurance Co. (5th Cir. 1978), 569 F.2d 304, 313.) Instead, Aetna insists, this court must limit its consideration to the terms of the insurance contracts. In Occidental Fire & Casualty Co. v. International Insurance Co. (7th Cir. 1986), 804 F.2d 983, however, the Seventh Circuit interpreted trucker policies similar to the contracts at bar and concluded that the insurance policy issued to the lessor, extending excess coverage to any truck it leased, demonstrated that the insurance company anticipated, when it wrote the policy, the possibility its insured would enter into leasing agreements and the insureds\u2019 lease did not alter the insurer\u2019s contractual obligations \u201cby collateral agreement.\u201d (Occidental Fire & Casualty Co. v. International Insurance Co., 804 F.2d at 990 n.3.) Quoting Truck Insurance Exchange v. Liberty Mutual Insurance Co. (1981), 102 Ill. App. 3d 24, 26, 428 N.E.2d 1183, the court continued: \u201c \u2018By its endorsements [the insurer] acknowledged that it was providing insurance pursuant to the lease. The respective policies, accompanying endorsements, and the lease so far as incorporated into the insurance contract, are construed together to determine the parties\u2019 intention.\u2019 \u201d (Emphasis added.) 804 F.2d at 990 n.3. See also Nowak v. Transport Indemnity Co. (1984), 120 Wis. 2d 635, 642-44, 358 N.W.2d 294, 298-99.\nAt bar, the contract between Smith and Meyer bound Meyer to lease \u201cEquipment to [Smith] for [Smith\u2019s] exclusive possession, control, use and responsibility during the periods the vehicle is operated by or for [Smith].\u201d (Emphasis added.) \u201cDuring,\u201d as used here, Aetna contends, illustrates that Smith\u2019s use, control and possession of the truck was not truly exclusive but rather subject at all times to interruption by Meyer. Indeed, another lease provision stated: \u201cNothing herein shall be construed as preventing [Meyer] from entering into a subsequent Lease of the same equipment during the duration of this Lease ***.\u201d Aetna reinforces this conclusion by noting: the truck was \u201cregularly\u201d stored in Meyer\u2019s garage during the lease term; Martin at all relevant times remained Meyer\u2019s employee; Smith surrendered 90% of gross revenues earned through the truck\u2019s use to Meyer; Meyer used the truck for its own business purposes \u201cfrom time to time\u201d during the lease period; and at the time of the accident, the truck bore the names of both companies, although only Smith\u2019s Illinois Commerce Commission permit number was displayed on the vehicle and the truck operated by the authority of that number.\nThe \u201cOther Insurance\u201d provision of the Aetna policy, however, obligates Aetna to provide primary coverage only for \u201cany covered auto while hired or borrowed by [Smith] and used exclusively in [Smith\u2019s] business and pursuant to operating rights granted to [Smith] by a public authority.\u201d CNA attempts to compare favorably the lease terms with the Aetna policy by reading the \u201cOther Insurance\u201d provision as \u201cwhile being used exclusively in your business.\u201d The word \u201cwhile,\u201d however, modifies only the phrase \u201chired or borrowed by you,\u201d indicating Aetna\u2019s duty to provide primary coverage arises only when Smith leases a truck which is used exclusively in Smith\u2019s business, not subject to interruption by the lessor. The \u201cand\u201d separating \u201cwhile hired or borrowed by you\u201d and \u201cused exclusively in your business\u201d binds the phrases together, creating a relationship between them rather than an expression of separate elements, as though the phrases read \u201cwhile hired or borrowed by you and while used exclusively in Smith\u2019s business.\u201d See Hailey v. County Board of School Trustees (1959), 21 Ill. App. 2d 105, 111-12, 157 N.E.2d 570.\nThis distinction is called into sharper relief when the \u201cOther Insurance\u201d provision quoted above is compared to the \u201cWho is Insured\u201d clause found in the same policy. Paragraph 4 includes as an insured the \u201cowner or anyone else from whom\u201d Smith leases a vehicle \u201cwhile the covered auto:\na. Is being used exclusively in your business, and\nb. Is being used pursuant to operating rights granted to you by a public authority.\u201d\nAlthough punctuation inserted in an insurance contract cannot be manipulated to alter the plain meaning of the text, rules of grammar may be consulted as an aid to construction to illumine the \u201ctrue meaning of the language used.\u201d (2 G. Couch, Cyclopedia of Insurance Law \u00a715:13, at 156-57 (rev. ed. 1984).) The colon placed after \u201cauto\u201d incorporates all the elements enumerated thereafter (Lunt v. Aetna Life Insurance Co. (1925), 253 Mass. 610, 616, 149 N.E. 660, 662), so that the sentence also could be read as \u201cwhile the covered auto is being used exclusively in your business and while the covered auto is being used pursuant to operating rights granted to you by a public authority.\u201d The distinction between these provisions is clear. Aetna must indemnify as an insured the owner or permissive driver of an automobile for liability incurred while the vehicle is exclusively under Smith\u2019s control, even if Smith does not enjoy singular control over the vehicle at every moment during the lease period. Aetna is obliged to extend primary coverage to that insured, however, only when Smith exclusively and continuously possesses, controls or uses the leased vehicle, throughout the lease term.\nBecause Aetna is not a \u201cprimary insurer\u201d as contemplated in paragraph 1 of its \u201cOther Insurance\u201d provision, reference there must be made to paragraph 3 of that section, which reads:\n\u201c3. Except as provided in Paragraphs 1 and 2 above, this policy provides primary insurance for any covered auto you own and excess insurance for any covered auto you don\u2019t own.\u201d (Emphasis added.)\nAetna correctly concludes that, since Smith did not own the subject vehicle, it is required to supply only excess insurance upon entry of a judgment against its insured. CNA, however, is also liable merely for excess coverage pursuant to the similar \u201cOther Insurance\u201d clause found in the CNA policy. A loss covered solely by two excess carriers renders the \u201cOther Insurance\u201d provisions irreconcilable, concealing each provision and forcing the insurers to divide the liability equally between themselves. Transport Indemnity Co. v. Carolina Casualty Insurance Co., 652 P.2d at 140; Truck Insurance Exchange v. Liberty Mutual Insurance Co., 102 Ill. App. 3d at 26; Continental Casualty Co. v. Travelers Insurance Co. (1967), 84 Ill. App. 2d 200, 206-07, 228 N.E.2d 141.\nUnder the foregoing circumstances, the circuit court\u2019s proration of responsibility on a 50-50 basis between Aetna and CNA was correct and must be affirmed.\nJudgment affirmed.\nSCARIANO and DiVITO, JJ., concur.\nIll. Rev. Stat. 1983, ch. 951/2, par. 18 \u2014 701 (current version at Ill. Rev. Stat. 1987, ch. 95\u00bd, par. 18c-4901).", "type": "majority", "author": "JUSTICE HARTMAN" } ], "attorneys": [ "Winston & Strawn, of Chicago (Paul P. Biebel, Jr., and Thomas R. Bear-rows, of counsel), for appellants.", "Cassiday, Schade & Gloor, of Chicago (D. Patterson Gloor and Michael G. Thomas, of counsel), for appellees." ], "corrections": "", "head_matter": "CONTINENTAL NATIONAL AMERICA INSURANCE COMPANY et al., Plaintiffs-Appellants, v. AETNA LIFE AND CASUALTY COMPANY et al., Defendants-Appellees.\nFirst District (2nd Division)\nNo. 1\u201488\u20141811\nOpinion filed August 1, 1989.\nWinston & Strawn, of Chicago (Paul P. Biebel, Jr., and Thomas R. Bear-rows, of counsel), for appellants.\nCassiday, Schade & Gloor, of Chicago (D. Patterson Gloor and Michael G. Thomas, of counsel), for appellees." }, "file_name": "0891-01", "first_page_order": 913, "last_page_order": 920 }