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Citizens Ins. Co. of Am. v. Selective Way Ins. Co.

United States District Court, E.D. Pennsylvania

April 14, 2015

CITIZENS INSURANCE COMPANY OF AMERICA, Plaintiff,
v.
SELECTIVE WAY INSURANCE COMPANY, Defendant

For CITIZENS INSURANCE COMPANY OF AMERICA, Plaintiff: MARNI BERGER, POST & SCHELL, PHILADELPHIA, PA; RICHARD L. MCMONIGLE, POST & SHELL PC, PHILADELPHIA, PA.

For SELECTIVE WAY INSURANCE COMPANY, Defendant: LOREN L. PIERCE, LEAD ATTORNEY, MCELROY DEUTSCH & MULVANEY LLP, MORRISTOWN, NJ; STEPHEN PAUL CHAWAGA, LEAD ATTORNEY, MC ELROY, DEUTSCH, MULVANEY & CARPENTER, LLP., PHILADELPHIA, PA.

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MEMORANDUM OPINION

WENDY BEETLESTONE, J.

This action involves a dispute between two insurers over which has the duty to defend general contractor Michael & Karen Palmieri Enterprises, Inc. d/b/a Lynmar Builders (" Lynmar" ) in personal injury litigation pending in a Pennsylvania state court and over the costs incurred in defending that litigation to date. Plaintiff, Citizens Insurance Company of America (" Citizens" )--Lynmar's insurer--is seeking

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judgment on the pleadings, pursuant to Federal Rule of Civil Procedure 12(c), that Defendant, Selective Way Insurance Company (" Selective" )--which insured one of Lynmar's subcontractors--owes a duty to defend the general contractor in the tort action. For the reasons set out below, the motion will be denied.

I. BACKGROUND

On November 19, 2009, Lynmar contracted to perform construction work at a Save-A-Lot store located at 5601 Vine Street in Philadelphia, Pennsylvania. Compl. ¶ 11. Lynmar subcontracted with Integrity Plumbing & Heating (" Integrity" ) to perform a portion of the construction work. Id. ¶ 12. The parties' pleadings do not state when Integrity completed its work on the project. However, Selective has alleged in its Answer that " Integrity's ongoing operations performed for Lynmar [did not] cause[] the bodily injury" at issue in the state court personal injury litigation. Answer at 6 (Eighth Affirmative Defense).[1]

That injury occurred on May 12, 2010, when an employee of Sav-A-Lot, Robert Tomlinson, allegedly " fell through an unidentified, unmarked and unguarded drop ceiling and/or floor in the vicinity of [the area in which Integrity performed its work] which appeared to be a floor," and sustained serious injuries. Compl. Ex. A ¶ ¶ 5, 30-31. Tomlinson filed suit in the Court of Common Pleas of Philadelphia County against, among others, Lynmar and Integrity (the " Tomlinson" action). In his complaint, Tomlinson alleges, inter alia, that the defendants were negligent in " failing to ensure adequate handrails and/or guardrails existed on the Premises," and in " failing to take proper measures to warn or guard the location of the accident." Id. Ex. A ¶ ¶ 66(n), (q).

Integrity is insured under a commercial general liability policy issued by the Defendant here, Selective (the " Policy" ). Compl. ¶ 18. The Policy also insures as additional insureds any party who Integrity agrees to indemnify in one of its construction contracts. Id. Ex. A at 11. Integrity's subcontract with Lynmar requires Integrity to indemnify Lynmar with respect to liability arising from Integrity's work and required that Lynmar be added to the Policy as an additional insured. Id. ¶ ¶ 15-16. Lynmar complied with those requirements. See id. ¶ ¶ 15-19. The provision of the Policy that extends coverage to Lynmar only extends that coverage for liability that is " caused in whole or in part by . . . [Integrity's] ongoing operations performed for [the indemnified party]." Id. Ex. C at 11 (emphasis added). The policy also provides Integrity with coverage for injuries arising out of its own operations that already have been completed, called " completed operations" coverage. Opp'n Ex. D at 23.[2] It does not, however, extend

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completed operations coverage to additional insureds, like Lynmar; they are covered only for injuries caused by ongoing operations. Compare Compl. Ex. C at 11, with Opp'n Ex. D at 23. Citizens contends that Tomlinson's injury " was caused . . . by [Integrity's] ongoing operations performed for [Lynmar], Compl. Ex. C at 11, and that Lynmar, therefore, is covered for the injury. Mot. at 10-11. Selective contends that the injury occurred " when all of the work in [Integrity's] contracts [with Lynmar] ha[d] been completed," Opp'n Ex. D at 23, that Lynmar is covered only for injuries caused by Integrity's ongoing operations and that Lynmar, therefore, is not covered for the injury. Opp'n at 12-13.

Lynmar tendered its defense of the Tomlinson Court of Common Pleas action to Selective. Compl. ¶ 19. Selective, however, did not accept that tender. Id. ¶ 20; Answer ¶ 20. As a result, Citizens, as Lynmar's insurer, ...


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