Westfield Insurance Co. v. FCL Builders, Inc.

State: Illinois

Court: 1st District Appellate

Docket No: 1-10-0521 NRel

Case Date: 03/08/2011

Preview:SECOND DIVISION MARCH 8, 2011 No. 1-10-0521 WESTFIELD INSURANCE COMPANY, Plaintiff-Appellee, v. FCL BUILDERS, INC., Defendant-Appellant, (Anwar Oshana, Defendant). ) ) ) ) ) ) ) ) ) ) ) ) ) Appeal from the Circuit Court of Cook County No. 08 CH 47632 Honorable Daniel A. Riley, Judge Presiding.

JUSTICE CONNORS delivered the judgment of the court, with opinion. Justices Karnezis and Harris concurred in the judgment and opinion. OPINION Defendant FCL Builders, Inc. (FCL), appeals from the circuit court's order granting summary judgment in favor of plaintiff Westfield Insurance Company (Westfield). The circuit court found that FCL was not an additional insured under the insurance policy that Westfield had issued to a third party, JAK Iron Works, Inc. (JAK). We affirm. BACKGROUND FCL is a general contractor that was hired to work on a construction project. FCL subcontracted out the steel fabrication and erection for the project to Suburban Ironworks, Inc. (Suburban), which in turn further subcontracted out the steel erection to JAK. JAK employed defendant Anwar Oshana. FCL's subcontract with Suburban required Suburban to perform all structural steel work for the project. The contract also required Suburban to obtain a certain amount of commercial general liability (CGL) insurance, which would cover not only Suburban and its employees but

No. 1-10-0521 also FCL as the general contractor. Importantly for this case, the contract mandated that any subcontractors that Suburban might further subcontract with must also maintain the same level of CGL insurance and include FCL as an insured under the policy. When Suburban subcontracted the steel erection work to JAK, Suburban and JAK executed a contract that incorporated by reference a previously existing Master Subcontract Agreement between the two parties. The master agreement included a provision that required JAK to obtain the same level of insurance coverage that was required by the contract between FCL and Suburban, the terms of which were also incorporated by reference into the JAKSuburban contract. In short, JAK was contractually required to purchase an insurance policy that would cover itself, Suburban, and FCL in the event of a mishap on the steel erection job. JAK duly purchased a CGL policy from Westfield. The policy contained an endorsement that amended the definition of "insured" under the contract. The endorsement reads, in pertinent part: "A. Section II

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