Anglo-American Insurance v. Molin

673 A.2d 986, 1996 Pa. Commw. LEXIS 112
CourtCommonwealth Court of Pennsylvania
DecidedFebruary 27, 1996
StatusPublished
Cited by2 cases

This text of 673 A.2d 986 (Anglo-American Insurance v. Molin) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Anglo-American Insurance v. Molin, 673 A.2d 986, 1996 Pa. Commw. LEXIS 112 (Pa. Ct. App. 1996).

Opinion

PELLEGRINI, Judge.

Presently before this Court is a motion for preliminary injunctive relief filed by Frederic S. Richardson, Emil J, Molin, and Theodore D. Nering (Richardson Defendants) seeking to enjoin Anglo-American Insurance Company and Colin Spreckley, an Underwriter at Lloyds’ London (Underwriters) from refusing to fund their defense costs under Policy No. 595/D0011400I (1994 Policy).1 The Richardson Defendants contend that the numerous allegations set forth in Maleski v. Corporate Life Insurance Co., 2 M.D. 1995 (Maleski action), fall within the coverage provided under the 1994 Policy, and therefore, the Underwriters are obligated to fund their defense in that action.

We begin by observing several well-established principles of law concerning the issuance of a preliminary injunction. A preliminary injunction may be granted only where the moving party establishes the following elements: (1) the relief is necessary to prevent immediate and irreparable harm that cannot be compensated by damages; (2) greater injury will occur from denying the injunction than from granting it; (3) the injunction will restore the parties to the status quo as it existed prior to the alleged [988]*988wrongful conduct; (4) the alleged -wrongful conduct is manifest; and (5) the moving party’s right to relief is clear. Lewis v. City of Harrisburg, 158 Pa.Cmwlth. 318, 631 A.2d 807 (1993). Being an extraordinary remedy, a preliminary injunction should not issue if the moving party’s right thereto is not clear. Albee Homes, Inc. v. Caddie Homes, Inc., 417 Pa. 177, 207 A.2d 768 (1965); Schaeffer v. Frey, 403 Pa.Superior Ct. 560, 589 A.2d 752 (1991).

The Richardson Defendants contend that they have satisfied all of the elements required for a preliminary injunction. The Underwriters do not argue that the Richardson Defendants do not meet the first four elements set forth above. Instead, they contend that the defense costs of the Maleski action are not covered by the 1994 Policy, because they interrelate to prior wrongful acts committed by the Richardson Defendants that are covered under a previous insurance policy. The resolution of the present case, therefore, requires the interpretation of the terms of the 1994 Policy to determine whether the defense costs from the Maleski action are reimbursable under that Policy.

In interpreting an insurance policy, this Court must read the policy in its entirety, giving the words their plain and proper meaning. Monti v. Rockwood Insurance Co., 303 Pa.Superior Ct. 473, 450 A.2d 24 (1982). The policy must be interpreted as a whole, and this Court should not focus upon a technical, precise and narrow interpretation of only one clause of the contract. Everett Cash Mutual Insurance Co. v. Krawitz, 430 Pa.Superior Ct. 25, 633 A.2d 215 (1993). However, if the terms used in an insurance policy are defined in that policy, then the given definitions control this Court’s interpretation of the coverage of that policy. Peerless Dyeing Co. v. Industrial Risk Insurers, 392 Pa.Superior Ct. 434, 573 A.2d 541 (1990), petition for allowance of appeal denied, 527 Pa. 636, 592 A.2d 1303 (1991). The insured may not avoid the application of a clear and unambiguous limitation clause in the insurance policy by asserting that it is ambiguous, especially when the allegedly ambiguous term is defined in the policy. See Ostroff v. Keystone Insurance Co., 357 Pa.Superior Ct. 109, 515 A.2d 584 (1986), petition for allowance of appeal denied, 515 Pa. 582, 527 A.2d 542 (1987). Given these principles of insurance policy construction, we turn now to the policy at issue in the present case.

I.

A Policy Provisions.

On January 29, 1993, the Underwriters issued a Directors’ and Officers’ Liability and Company Reimbursement Policy (1993 Policy) to American Homestead, Inc., the parent corporation of Corporate Life Insurance Company (Corporate Life). The 1993 Policy, which provided coverage from the date of issuance until December 31, 1993, contained an aggregate limit of liability of $1.5 million. On January 29, 1994, the Underwriters issued another Directors’ and Officers’ Liability and Company Reimbursement Policy (1994 Policy) to American Homestead, Inc. The 1994 Policy, which expired on December 31,1994, also contained an aggregate limit of liability of $1.5 million. Both the 1993 and 1994 Policies are “claims made” policies2 containing the following notice:

NOTICE: THIS POLICY SUBJECT TO ITS TERMS APPLIES ONLY TO ANY CLAIM MADE AGAINST THE DIRECTORS AND OFFICERS DURING THE POLICY PERIOD. THE LIMIT OF LIABILITY AVAILABLE TO PAY DAMAGES OR SETTLEMENTS SHALL BE REDUCED AND MAY BE EXHAUSTED BY AMOUNTS INCURRED AS COSTS, CHARGES AND EXPENSES AND COSTS, CHARGES AND EXPENSES SHALL BE APPLIED TO THE RETENTIONS. THIS POLICY [989]*989DOES NOT PROVIDE FOR ANY DUTY BY UNDERWRITERS TO DEFEND THOSE INSURED UNDER THE POLICY.

Additionally, in the Insurance Clauses of both the 1993 and 1994 Policies, the Underwriters agreed to:

pay on behalf of the Directors and Officers Loss resulting from any Claim first made during the Policy Period or the Optional Extension Period, if applicable, against any of them for a Wrongful Act, where the Company has not indemnified them for such Loss.

Article III of the 1994 Policy sets forth numerous exclusions from coverage by providing that

Underwriters shall not be liable to make any payment for Loss in connection with any Claim made against the Directors and Officers:
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B. based upon, arising out of, directly or indirectly resulting from or in consequence of, or in any way involving:
(1) any Wrongful Act or any fact, circumstance or situation, event or transaction which has been the subject of any notice given prior to the effective date of this Policy under any prior policy, or
(2) any other Wrongful Act whenever occurring, which, together with a Wrongful Act which has been the subject of such notice, would constitute Interrelated Wrongful Acts;

The 1994 Policy also contains an Interrelationship and Date of Claim Clause which provides that:

More than one Claim involving the same Wrongful Act or Interrelated Wrongful Acts of one or more of the Directors and Officers shall be deemed to constitute a single Claim and such single Claim shall be deemed to have been made at the earlier of the following times:
(1) the time the earliest of any Claim within such single Claim was first made; or

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Related

Anglo-American Insurance v. Molin
691 A.2d 929 (Supreme Court of Pennsylvania, 1997)
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942 F. Supp. 1005 (D. New Jersey, 1996)

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673 A.2d 986, 1996 Pa. Commw. LEXIS 112, Counsel Stack Legal Research, https://law.counselstack.com/opinion/anglo-american-insurance-v-molin-pacommwct-1996.