{ "id": 2553106, "name": "STATE STREET BANK AND TRUST COMPANY OF QUINCY, ILLINOIS, Plaintiff-Appellant, v. INA INSURANCE COMPANY OF ILLINOIS, Defendant-Appellee", "name_abbreviation": "State Street Bank & Trust Co v. INA Insurance", "decision_date": "1991-02-06", "docket_number": "No. 4-90-0245", "first_page": "961", "last_page": "968", "citations": [ { "type": "official", "cite": "207 Ill. App. 3d 961" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "256 Or. 24", "category": "reporters:state", "reporter": "Or.", "case_ids": [ 2112751 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/or/256/0024-01" ] }, { "cite": "282 N.W.2d 425", "category": "reporters:state_regional", "reporter": "N.W.2d", "weight": 2, "opinion_index": 0 }, { "cite": "90 Mich. App. 633", "category": "reporters:state", "reporter": "Mich. App.", "case_ids": [ 2178226 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/mich-app/90/0633-01" ] }, { "cite": "547 N.E.2d 718", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "191 Ill. App. 3d 203", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 2512098 ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/191/0203-01" ] }, { "cite": "457 N.E.2d 9", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1989, "opinion_index": 0 }, { "cite": "98 Ill. 2d 382", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3121957 ], "year": 1989, "opinion_index": 0, "case_paths": [ "/ill-2d/98/0382-01" ] }, { "cite": "408 N.E.2d 928", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "87 Ill. App. 3d 446", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3177871 ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/87/0446-01" ] }, { "cite": "402 N.E.2d 613", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1980, "opinion_index": 0 }, { "cite": "79 Ill. 2d 228", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3069537 ], "year": 1980, "opinion_index": 0, "case_paths": [ "/ill-2d/79/0228-01" ] }, { "cite": "430 N.E.2d 1079", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "88 Ill. 2d 444", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3082811 ], "opinion_index": 0, "case_paths": [ "/ill-2d/88/0444-01" ] }, { "cite": "534 N.E.2d 1066", "category": "reporters:state_regional", "reporter": "N.E.2d", "pin_cites": [ { "page": "1068" } ], "opinion_index": 0 }, { "cite": "179 Ill. App. 3d 752", "category": "reporters:state", "reporter": "Ill. 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App. 3d", "case_ids": [ 3223219 ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/82/0083-01" ] } ], "analysis": { "cardinality": 798, "char_count": 16324, "ocr_confidence": 0.772, "pagerank": { "raw": 1.6733953597992455e-07, "percentile": 0.6963073908942181 }, "sha256": "26181b746b3e473fdf6a5418f8e834ba98f4f5a6ca75d4d687d38d497f0a801c", "simhash": "1:9bde1f3ae851f836", "word_count": 2562 }, "last_updated": "2023-07-14T17:11:09.339704+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "STATE STREET BANK AND TRUST COMPANY OF QUINCY, ILLINOIS, Plaintiff-Appellant, v. INA INSURANCE COMPANY OF ILLINOIS, Defendant-Appellee." ], "opinions": [ { "text": "JUSTICE KNECHT\ndelivered the opinion of the court:\nThis is another in a series of appeals arising out of John O\u2019Brien\u2019s litigation against plaintiff State Street Bank and Trust Company (State Street). In this appeal, State Street seeks reversal of a circuit court order which, in effect, held defendant INA Insurance Company of Illinois (INA) did not have a duty to defend O\u2019Brien\u2019s lawsuit against State Street. We affirm.\nO\u2019Brien sued State Street in November 1975, alleging he was a business loan customer of State Street and that, on previous occasions, State Street had acquiesced in late payments on his loans. O\u2019Brien further alleged that in November 1971, when one of O\u2019Brien\u2019s debts to State Street was past due, an officer of State Street advised O\u2019Brien to enter a hospital for a rest and told him if necessary, he would assist and advise O\u2019Brien\u2019s employees during his absence. However, during O\u2019Brien\u2019s hospitalization, State Street allegedly (1) accelerated the due dates of all of O\u2019Brien\u2019s debts and obligations to it; (2) offset and seized various amounts which O\u2019Brien had on deposit at State Street; (3) seized com from O\u2019Brien\u2019s business facilities and hogs from O\u2019Brien\u2019s farm; and (4) confessed judgment on various of O\u2019Brien\u2019s promissory notes which it held. O\u2019Brien alleged these actions violated sections 1 \u2014 103, 1\u2014 201(19), 1 \u2014 203, 1 \u2014 208, 9 \u2014 503, and 9 \u2014 507 of the Uniform Commercial Code (UCC) (Ill. Rev. Stat. 1969, ch. 26, pars. 1 \u2014 103, 1 \u2014 201(19), 1\u2014 203, 1 \u2014 208, 9 \u2014 503, 9 \u2014 507). According to O\u2019Brien\u2019s complaint, these actions destroyed O\u2019Brien\u2019s financial standing, the goodwill of O\u2019Brien\u2019s businesses, and his ability to obtain credit. O\u2019Brien further claimed State Street\u2019s actions reduced his- net worth from approximately $100,000 to zero. O\u2019Brien also alleged, as a result of a petition filed by State Street and other creditors, an involuntary adjudication of bankruptcy was entered against him on June 29,1972.\nIn count I of his complaint, O\u2019Brien asserted State Street committed the violations of the UCC mentioned therein \u201cwillfully, wantonly, intentionally, maliciously, recklessly and in bad faith.\u201d In count II, O\u2019Brien alleged these actions were committed \u201cnegligently and carelessly and in bad faith.\u201d\nIn 1980, this court held count I of O\u2019Brien\u2019s complaint stated a cause of action for intentional interference with O\u2019Brien\u2019s business relationships, while count II attempted to state a cause of action for negligent interference with O\u2019Brien\u2019s business relationships. This court reversed a portion of a circuit court order which dismissed count I and affirmed the portion of the same order which dismissed count II. O\u2019Brien v. State Street Bank & Trust Co. (1980), 82 Ill. App. 3d 83, 401 N.E.2d 1356.\nFollowing extensive discovery, the circuit court entered summary judgment in favor of State Street as to count I. This court affirmed that order on March 10, 1986 (O\u2019Brien v. State Street Bank & Trust Co. (1986), 140 Ill. App. 3d 1151 (unpublished order under Supreme Court Rule 23)), and the supreme court denied O\u2019Brien\u2019s petition for leave to appeal (O\u2019Brien v. State Street Bank & Trust Co. (1986), 112 Ill. 2d 579).\nAfter the conclusion of the litigation involving O\u2019Brien, State Street sought reimbursement from United States Fidelity and Guaranty Company (USF&G) of the expenses, costs, and attorney fees which it incurred in defending O\u2019Brien\u2019s suit, under terms of a banker\u2019s fidelity bond which USF&G issued to State Street. In State Street Bank & Trust Co. v. United States Fidelity & Guaranty Co. (1989), 181 Ill. App. 3d 1081, 539 N.E.2d 779, this court affirmed a summary judgment order which the circuit court entered in USF&G\u2019s favor.\nOn March 30, 1987, State Street commenced the present action by filing a complaint against INA. State Street\u2019s amended complaint, filed July 8, 1987, alleges that on or about November 1, 1971, it was insured under an \u201cOffice Building Policy\u201d issued by INA. The complaint further alleges State Street tendered the defense of O\u2019Brien\u2019s suit to INA, INA refused to defend the suit, and O\u2019Brien\u2019s claims were within or potentially within the coverage of the policy which INA issued to State Street. In count I, State Street requests (1) damages consisting of all amounts which it expended in the defense of O\u2019Brien\u2019s lawsuit, (2) prejudgment interest, and (3) costs incurred in the present action. In count II, State Street requests an award of taxable costs, as defined in section 155 of the Illinois Insurance Code (Ill. Rev. Stat. 1987, ch. 73, par. 767), on the basis INA\u2019s failure to defend was \u201cvexatious and unreasonable,\u201d and, thus, in violation of section 155.\nOn September 21, 1987, the circuit court denied INA\u2019s motion to dismiss State Street\u2019s amended complaint. State Street filed a motion for summary judgment on August 4, 1988, and INA filed a cross-motion for summary judgment on October 11,1989.\nAttached to an affidavit filed in support of State Street\u2019s motion for summary judgment is a copy of the terms of an \u201coffice building policy\u201d which INA issued to State Street. The policy provides in pertinent part:\n\u201cThe Company will pay on behalf of the Insured, except as hereafter provided, all sums which the Insured shall become legally obligated to pay as damages because of:\nA-PERSONAL INJURY or B-PROPERTY DAMAGE\ncaused by an occurrence during the policy period and within the policy territory.\n* * *\n2. \u2018Bodily injury\u2019 means bodily injury, sickness or disease sustained by any person;\n* * *\n11. \u2018Occurrence\u2019 means an accident, including injurious exposure to conditions, which results, during the policy period, in personal injury or property damage neither expected nor intended from the standpoint of the insured;\n12. \u2018Personal injury\u2019 means bodily injury or if arising out of bodily injury, mental anguish. It also includes injury arising out of one or more of the following offenses:\nGroup A \u2014 false arrest, detention or imprisonment, or malicious prosecution;\nGroup B \u2014 the publication or utterance of a libel or slander or of other defamatory or disparaging material, or a publication or utterance in violation of an individual\u2019s right of privacy; except publications or utterances in the course of or related to advertising, broadcasting, publishing, or telecasting activities conducted by or on behalf of the Named Insured;\nGroup C \u2014 wrongful entry or eviction, or other invasion of the right of private occupancy;\n* * *\n15. \u2018Property damage\u2019 means injury to or destruction of tangible property.\u201d\nThe \u201cexclusions\u201d section of the policy applicable to liability insurance provides:\n\u201c[Ijnsurance shall not apply ***\n1. With respect to:\n* * *\nn. personal injury or property damage due to:\n(1) the rendering of or failure to render\n(a) medical, surgical, dental, X-ray or nursing service or treatment, or the furnishing of food or beverages in connection therewith;\n(b) any service or treatment conducive to health or of a professional nature;\n(c) any cosmetic, tonsorial, massage, physiotherapy, chiropody, hearing aid, optical or optometrical services or treatments;\n(d) any professional service ***.\u201d\nOn March 15, 1990, the circuit court entered summary judgment in favor of INA. The court held O\u2019Brien\u2019s complaint did not contain allegations which brought his claims potentially within the coverage of the policy which INA issued to State Street. In the court\u2019s view, \u201cthe inevitable result of the Bank\u2019s purposeful actions [alleged in O\u2019Brien\u2019s complaint] was the harm which occurred to Mr. O\u2019Brien.\u201d Because, from State Street\u2019s perspective, the damages which O\u2019Brien allegedly sustained were \u201cnot unusual, unforeseen, or unexpected,\u201d the court concluded State Street\u2019s alleged actions and the consequences thereof were not an \u201coccurrence\u201d within the coverage of the policy.\nIn appealing this decision, State Street argues since O\u2019Brien\u2019s complaint alleged negligent acts which destroyed his businesses, and did not allege the resulting damages were intended or expected from State Street\u2019s viewpoint, the circuit court erred in holding there was no \u201coccurrence\u201d within the meaning of the policy which INA issued to State Street. State Street points out O\u2019Brien\u2019s complaint did not allege State Street intended to destroy O\u2019Brien\u2019s businesses and bankrupt him. State Street suggests it is not inevitable that, every time a bank acts to protect its loans, the borrower\u2019s businesses will be destroyed, and the borrower will be bankrupted. State Street contends the circuit court, in reaching its decision, did not consider whether there was a possibility State Street did not expect the damages its actions allegedly caused to O\u2019Brien.\nState Street further argues there is an incompatibility between the policy coverage for torts such as defamation, malicious prosecution, and wrongful entry, which involve malicious or intentional conduct, and the general exclusion of coverage for intended or expected damages contained in the definition of \u201coccurrence.\u201d State Street maintains either (1) with respect to the tortious actions specified under the definition of \u201cpersonal injury,\u201d the definition of \u201coccurrence\u201d must be ignored, or (2) there is no coverage for the torts specifically described under the definition of \u201cpersonal injury.\u201d\nState Street further argues the damages allegedly sustained by O\u2019Brien were potentially within the definition of \u201cpersonal injury.\u201d State Street maintains the alleged wrongful seizure of corn and hogs from real estate belonging to O\u2019Brien potentially amounted to \u201cwrongful entry\u201d or \u201cother invasion of the right of private occupancy\u201d of O\u2019Brien\u2019s real estate by State Street.\nINA asserts the circuit court correctly concluded O\u2019Brien\u2019s complaint did not even potentially allege an occurrence which would have been covered by the policy. INA states the damages which O\u2019Brien allegedly sustained were not an \u201caccident\u201d for purposes of determining whether there was an \u201coccurrence\u201d within the meaning of the policy, but instead State Street reasonably should have anticipated O\u2019Brien\u2019s alleged damages would result from the allegedly wrongful acts it committed.\nINA further asserts O\u2019Brien\u2019s complaint did not contain allegations of \u201cpersonal injury\u201d consisting of either wrongful entry or eviction. INA also argues O\u2019Brien did not allege \u201cproperty damage\u201d within the meaning of the policy it issued to State Street, since liability coverage for property damage is clearly and unambiguously limited to \u201cinjury to or destruction of tangible property.\u201d INA asserts \u201ctangible property\u201d does not include anticipated profits, financial interests in business ventures, or business relationships.\nIn Western Casualty & Surety Co. v. Adams County (1989), 179 Ill. App. 3d 752, 756-57, 534 N.E.2d 1066, 1068, this court recently summarized the principles applicable to determining whether an insurer has an obligation to defend a lawsuit brought against an insured:\n\u201cIn Illinois, an insurer[\u2019s] duty to defend an action against its insured is determined by the allegations of the complaint. An insurer may not justifiably refuse to defend an action against its insured unless it is clear from the face of the complaint that the allegations fail to state facts which bring the case within, or potentially within, the policy\u2019s coverage. [Citation.] The duty to defend is much broader than the duty to indemnify. [Citations.] The duty to defend extends to cases .where the complaint alleges several causes of action or theories of recovery against an insured even if only one or some of them are within the policy coverage. [Citation.] Unless the complaint on its face clearly alleges facts which, if true, would exclude coverage, the potentiality of coverage is present and the insurer has a duty to defend. [Citation.] \u2018Potentially covered\u2019 means that the insurer\u2019s duty to defend its insured arises whenever the allegations in a complaint state a cause of action that gives rise to the possibility of a recovery under the policy. There need not be a probability of recovery. [Citations.] The complaint need not allege or use language affirmatively bringing the claims within the scope of the policy, as the question of coverage should not hinge exclusively on the draftsmanship skills or whims of the plaintiff in the underlying action. [Citation.]\nIf the words of a policy can reasonably be given their plain, ordinary, and popular meaning, the provisions should be applied as written and the parties should be bound to the agreement they made. [Citation.] The complaint against the insured must be liberally construed. Any doubts about potential coverage are to be resolved in the insured\u2019s favor.\u201d\nWhen the underlying complaint sets forth claims potentially within the coverage of an insurance policy, the insurer must either defend under a reservation of rights or seek a declaratory judgment that there is no coverage. Failure to do this estops the insurer from later raising policy defenses to coverage. (Murphy v. Urso (1981), 88 Ill. 2d 444, 430 N.E.2d 1079.) When, however, a comparison of the insurance policy and the underlying complaint reveals there is clearly no coverage, and the claims in the underlying complaint thus are not potentially within the coverage of the policy, the insurer is never estopped from asserting policy defenses in an action seeking damages based on its alleged wrongful refusal to defend. Estes Co. v. Employers Mutual Casualty Co. (1980), 79 Ill. 2d 228, 402 N.E.2d 613; La Rotunda v. Royal Globe Insurance Co. (1980), 87 Ill. App. 3d 446, 408 N.E.2d 928.\nWe hold the circuit court correctly entered summary judgment in favor of INA. However, we affirm the circuit court\u2019s order on grounds different from those on which the court relied. See Material Service Corp. v. Department of Revenue (1983), 98 Ill. 2d 382, 457 N.E.2d 9; Computer Teaching Corp. v. Courseware Applications, Inc. (1989), 191 Ill. App. 3d 203, 547 N.E.2d 718.\nThe insurance policy at issue is an \u201coffice building policy.\u201d Insurance policies of this type are intended to cover losses arising out of building ownership or occupancy. (American Fellowship Mutual Insurance Co. v. Insurance Co. of North America (1979), 90 Mich. App. 633, 282 N.W.2d 425.) The policy at issue excludes liability coverage for personal injury or property damage due to the insured\u2019s rendering of or failure to render \u201cany professional service.\u201d In construing exclusions such as this, courts have adopted an expansive definition of the term \u201cprofessional service.\u201d The term is not limited to services performed by persons who must be licensed by a governmental authority in order to practice their professions. Rather, it refers to any business activity conducted by the insured which involves specialized knowledge, labor, or skill, and is predominantly mental or intellectual as opposed to physical or manual in nature. American Fellowship Mutual Insurance, 90 Mich. App. 633, 282 N.W.2d 425; Multnomah County v. Oregon Automobile Insurance Co. (1970), 256 Or. 24, 470 P.2d 147.\nO\u2019Brien\u2019s claims against State Street were not in any way directly related to its ownership or occupancy of the office building which was insured by the policy which INA issued to State Street. Instead, O\u2019Brien\u2019s claims arose from State Street\u2019s exercise of its business judgment in conducting its principal business activity. O\u2019Brien\u2019s claims were thus premised on State Street\u2019s rendering or failure to render a professional service, and there was no potential for coverage of his claims under the policy at issue. INA, therefore, had no duty to defend O\u2019Brien\u2019s lawsuit against State Street.\nBecause of our decision, we need not address the parties\u2019 remaining contentions.\nThe circuit court order entering summary judgment in INA\u2019s favor is affirmed.\nAffirmed.\nLUND, P.J., and GREEN, J., concur.", "type": "majority", "author": "JUSTICE KNECHT" } ], "attorneys": [ "Keefe, Gorman & Brennan, of Quincy (Jerry L. Brennan, of counsel), for appellant.", "Heyl, Royster, Voelker & Allen, of Peoria, and Heyl, Royster, Voelker & Allen, of Springfield (Karen L. Kendall, Frederick P. Velde, and Kurt M. Koepke, of counsel), for appellee." ], "corrections": "", "head_matter": "STATE STREET BANK AND TRUST COMPANY OF QUINCY, ILLINOIS, Plaintiff-Appellant, v. INA INSURANCE COMPANY OF ILLINOIS, Defendant-Appellee.\nFourth District\nNo. 4\u201490\u20140245\nOpinion filed February 6, 1991.\n\u2014 Rehearing denied March 4, 1991.\nKeefe, Gorman & Brennan, of Quincy (Jerry L. Brennan, of counsel), for appellant.\nHeyl, Royster, Voelker & Allen, of Peoria, and Heyl, Royster, Voelker & Allen, of Springfield (Karen L. Kendall, Frederick P. Velde, and Kurt M. Koepke, of counsel), for appellee." }, "file_name": "0961-01", "first_page_order": 983, "last_page_order": 990 }