Wheeler v. Aetna Cas. & Sur. Co.

• Decision Date: 29 March 1974
• Docket Number: No. 46008,46008
• Citation: 311 N.E.2d 134,57 Ill.2d 184
• Parties: E. Todd WHEELER et al., Appellants, v. The AETNA CASUALTY AND SURETY COMPANY, Appellee.
• Court: Illinois Supreme Court

Page 134

311 N.E.2d 134

57 Ill.2d 184

E. Todd WHEELER et al., Appellants, v. The AETNA CASUALTY AND SURETY COMPANY, Appellee.

No. 46008.

Supreme Court of Illinois.

March 29, 1974.

Rehearing Denied May 31, 1974.

Tom L. Yates, Chicago (Frederic L. Goff, Chicago, of counsel), for appellants.

Kirkland & Ellis, Chicago (Gary M. Elden, Donald J. Duffy, Jack T. Riley, and William H. Symmes, Chicago, of counsel), for appellee.

KLUCZYNSKI, Justice:

Plaintiffs, E. Todd Wheeler and the Perkins and Will Partnership, filed an action for a declaratory judgment in the circuit court of Cook County against Aetna Casualty and Surety Company (hereafter Aetna). The circuit court granted plaintiffs' motion for summary judgment but the appellate court reversed and remanded with directions to enter a declaratory judgment in favor of Aetna. (Wheeler v. Aetna Casualty and Surety Co., 11 Ill.App.3d 841, 298 N.E.2d 329.) We granted leave to appeal.

The Perkins and Will Partnership is an architectural firm and E. Todd Wheeler is a partner therein. Perkins and Will had contracted with Silver Cross Hospital to provide its services in the alteration and construction of an addition to the hospital building. John Wagner, an ironworker, was injured on the project and filed suit in January 1970 against plaintiffs herein and others. Liability was predicated upon alleged violation of the Structural Work Act. (Ill.Rev.Stat.1969, ch. 48, par. 60 et seq.) Wagner's complaint alleged:

'2. That on September 29, 1969, the defendants, SILVER CROSS HOSPITAL, E. TODD WHEELER AND THE PERKINS AND WILL PARTNERSHIP, and S. N. NIELSEN & COMPANY, A Corporation, and each of them, were entities simultaneously and concurrently in charge of the erection and construction of the aforesaid building or other structure located on the premises of the Silver Cross Hospital, located at 500 Walnut, in said city, county and state.

3. That on September 29, 1969, and prior thereto, the plaintiff, and other construction workers, were required to work upon certain scaffolding which was then and there being used in the erection and construction of the said building or other structure.

4. That on the above date, and prior thereto, the aforementioned scaffold was erected, controlled and placed in a manner which was not safe, suitable and proper for the protection of working men working on or about the same.

5. On the above date, the plaintiff, in the course of his employment, was upon the aforementioned scaffold and fell therefrom when a plank broke or gave way by virtue of the faulty erection, opperation and placing of said scaffold.'

Prior to Wagner's alleged injury the Perkins and Will Partnership purchased a public-liability policy from Aetna, which provided:

'The Company will pay on behalf of the Insured all sums which the insured shall become obligated to pay as damages because of bodily injury or property damage to which this insurance applies, caused by an occurrence, and the Company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent * * *.'

The policy also contained an exclusion clause.

'Exclusion (Engineers, Architects or Surveyors Professional liability)

It is agreed that the insurance does not apply to bodily injury or property damage arising out of any professional services performed by or for the named insured, including (1) the preparation or approval of maps, plans, opinions, reports, surveys, designs or specifications and (2) supervisory, inspection or engineering services.'

It had also secured an 'Architects and/or Engineers Liability Policy' from another insurer, Continental Casualty Co. (hereinafter Continental). That policy, in pertinent part, stated:

'The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages if legal liability arises out of the performance of professional services for others in the insured's capacity as an architect or an engineer and if such legal liability is caused by an error, omission or negligent act.'

Perkins and Will tendered the defense of the Wagner suit to Aetna, which refused to assume the defense because it maintained that the allegations in the Wagner complaint did not encompass a situation within the purview of its public-liability policy and were expressly excluded. Continental thereafter retained counsel to defend plaintiffs in the Wagner action. Plaintiffs then commenced the declaratory judgment action against Aetna seeking to require that Aetna pay any judgment against plaintiffs or any reasonable settlement on their behalf in the Wagner suit; that any express or additional damages accrued in the defense of plaintiffs be reimbursed; and that $1000 in legal fees be assessed against Aetna for its vexatious refusal to defend. The circuit court order granting summary judgment for plaintiffs provided that 'Aetna is required to defend the complaint and pay any judgment based thereon.'

The appellate court reversed and remanded. In doing so, it recognized that in Illinois, the duty of an insurance company to defend its insured in an action for injuries must be judged by the allegations of the complaint. (Sims v. Illinois National Casualty Co., 43 Ill.App.2d 184, 191, 193 N.E.2d 123.) The appellate court, however, expanded this principle by taking...