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CITY OF ERIE v. GUAR. NAT'L INS. CO.
January 19, 1996
CITY OF ERIE, Plaintiff,
GUARANTY NATIONAL INSURANCE COMPANY, IMPERIAL CASUALTY AND INDEMNITY COMPANY, and WESTERN WORLD INSURANCE COMPANY, Defendants.
The opinion of the court was delivered by: MCLAUGHLIN
This Court's jurisdiction over this action is by reason of diversity of citizenship under 28 U.S.C. § 1332. The Plaintiff is the City of Erie, Pennsylvania (the "City," "Erie") The defendants are several companies that provided insurance coverage to Erie between 1980 and 1995. Guaranty National Insurance Company and Western World Insurance Company have moved to dismiss this action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons that follow, these motions will be granted.
Each of the defendants has entered into one or more contracts with the City to tender a defense to certain categories of civil actions and to indemnify the City for its losses as a result of claims within those categories. The City and several of its employees are currently defendants in DiNicola v. DiPaolo, Civil Action 94-323 Erie (W.D. Pa.), which is pending before this Court. The City alleges that each of the insurance companies has breached its contract by refusing to tender a defense or agree to indemnify it in connection with this action.
With its Complaint, Erie filed copies of the General Municipal Liability, Law Enforcement Professional Liability, and General Liability policies under which it was insured from July 1, 1980 to January 1, 1995. Only the policies issued by Guaranty National and Western World are relevant to these motions.
1. The Guaranty National policies
Guaranty National issued four "Municipal Liability" policies to Erie. These policies were in effect from July 1, 1980 to January 1, 1984. See Exs. A-D to Complaint. Each policy stated in the first paragraph of its Municipal Liability Coverage Form:
The Company will pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay by reason of liability imposed by law, or liability assumed under contract, insofar as the Named Insured may legally do so, for damages because of:
A. Personal Injury Liability
B. Property Damage Liability, or
C. Errors and Omissions Liability
to which this insurance applies, caused by an occurrence within the policy period . . . .
Each policy defined "Personal Injury" to include malicious prosecution. "Occurrence" was defined in the earlier policies as "an accident including continuous or repeated exposure to conditions, which results in personal injury . . . neither expected nor intended from the standpoint of the Insured," see Exs. A-B, and in the later policies as "an accident or event, including continuous or repeated exposure to conditions, which results during the ...
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