2019 IL App (1st) 180743 

FIRST DIVISION

March 29, 2019 

IN THE

APPELLATE COURT OF ILLINOIS

FIRST DISTRICT

No. 1-18-0743 

ACUITY INSURANCE COMPANY,

Plaintiff and Third-Party Defendant-Appellee, 

v. 

950 WEST HURON CONDOMINIUM ASSOCIATION, 

BELGRAVIA GROUP, LTD., BELGRAVIA 

CONSTRUCTION CORPORATION, MASONRY 

SYSTEMS, and DENK & ROCHE, LTD., 

Defendants

(Cincinnati Insurance Company, Third-Party Plaintiff and 

Intervenor-Appellant). 

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Appeal from the 

Circuit Court of 

Cook County. 

No. 2013 CH 23100 

Honorable 

Anna Demacopolous, 

Judge Presiding. 

PRESIDING JUSTICE MIKVA delivered the judgment of the court, with opinion. 

Justices Pierce and Walker concurred in the judgment and opinion.

OPINION

¶ 1 This case raises the issue of when a complaint filed against a subcontractor on a 

construction project is sufficient to trigger a duty to defend under a commercial general liability 

policy. The two insurers who are before us and provided coverage to the same carpentry 

subcontractor saw this issue quite differently. 

¶ 2 Acuity Insurance Company (Acuity) filed an action seeking a declaration that it owed its 

insured, carpentry subcontractor Denk & Roche Builders, Inc. (Denk & Roche), no duty to 
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defend it in a construction lawsuit. Cincinnati Insurance Company (Cincinnati)—which also 

insured Denk & Roche, did defend it, and ultimately settled all claims against it—intervened to 

seek equitable contribution from Acuity. The trial court agreed with Acuity that there was no 

duty to defend and ruled in its favor and against Cincinnati on cross-motions for summary 

judgment. For the reasons that follow, we reverse and remand for further proceedings.

¶ 3 I. BACKGROUND

¶ 4 The condominium association for the building located at 950 West Huron Street in 

Chicago, Illinois (Association), sued its general contractor and construction manager Belgravia 

Group, Ltd., and Belgravia Construction Corporation (collectively Belgravia). The Association

sought to recover for alleged defects from Belgravia’s unworkmanlike construction of the 

building envelope that allowed water to infiltrate and cause damage. Belgravia, in turn, filed a 

third-party complaint against its subcontractors that worked on the building, including the 

carpentry subcontractor Denk & Roche. Denk & Roche held commercial general liability (CGL) 

insurance policies with two insurers during the relevant period—one with Cincinnati that was 

effective January 1, 2000, through June 1, 2007, and another with Acuity effective June 1, 2007, 

through December 31, 2007, with Acuity renewal policies covering through December 31, 2013. 

¶ 5 Denk & Roche tendered its defense to both insurers. Cincinnati agreed to defend and 

represented Denk & Roche to a settlement of the construction claims. Acuity denied from the 

outset that the allegations against Denk & Roche triggered a duty to defend under its CGL policy 

and filed this suit seeking a declaration to that effect, naming as defendants Denk & Roche, 

another subcontractor, Belgravia, and the Association. Cincinnati intervened in this case and 

filed a third-party counterclaim against Acuity, seeking declarations that Acuity owed Denk & 

Roche a defense and that Acuity therefore owes Cincinnati equitable contribution. The relevant 
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3 

details draw from the two insurers’ cross-motions for summary judgment and various 

attachments in support of those motions. 

¶ 6 A. Allegations Against Denk & Roche 

¶ 7 In the Association’s operative second amended verified complaint (Association 

complaint), it alleged that “[o]n or about June 28, 2002, [after the Association took] possession, 

but prior to the completion of the construction, Belgravia *** became aware of numerous 

conditions and defects with the building, including extensive water infiltration of the building.” 

After raising the issues with Belgravia, the Association alleged that Belgravia “retained 

contractors *** to provide cosmetic ‘fixes’ which did not address the aforementioned design and 

construction defects and problems.” A “forensic analysis which required openings and 

penetrations in the building envelope” in September 2011 and May 2012 revealed to the 

Association the full extent of the construction and design defects allegedly caused by Belgravia. 

The Association enumerated several categories of defects attributable to Belgravia or its agents, 

including improper seals at various doors, masonry problems, improperly installed flashings at 

doors and windows, and a host of other construction issues. These issues allegedly led to water 

damage, thus “interfering with the habitation and usage of the common elements and individual 

condominium units within the building.” The Association alleged that it “has spent substantial 

sums of money to identify, correct and remediate” these damages and “will incur substantial 

sums relating to the cost of future repairs.” 

¶ 8 In Belgravia’s operative second amended third-party complaint (Belgravia complaint), 

Belgravia incorporated the Association complaint by reference and briefly mentioned 

photographs not included in the record on appeal that show “alleged property damage to carpet, 

wood floors, and other items allegedly resulting from water damage.” The Belgravia complaint 
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contained 23 counts of breach of contract and negligence against Denk & Roche and five other 

subcontractors. Almost every count contains a nearly identical list of masonry, construction, 

fixture installation, and sealant defects that collectively are alleged to have contributed to the 

building’s water infiltration issue. The first four counts were leveled against Denk & Roche, 

based on breach of its carpentry subcontract with Belgravia, breach of implied warranty, breach 

of indemnity, and negligent construction. Belgravia alleged that if it was found “liable to the 

[Association] in any amount whatsoever,” then its liability was “because of the defective work 

performed by [Denk & Roche].” As with the counts against the other subcontractors, Belgravia’s 

claims against Denk & Roche described the particular services for which Belgravia retained the 

carpentry firm, including for “[a]ll rough and finish carpentry,” “[c]aulking of all items to be 

installed,” “except for windows and glass patio doors,” and installation of doors, frames, and 

“[w]indows and sliding and swinging glass doors” in the Association’s building. In the breach of 

contract counts, Belgravia alleged Denk & Roche breached its contractual duty to provide 

workmanlike construction services and, in the negligence count, alleged it has “personally 

sustained and will continue to sustain costs [for] investigation, inspection, evaluation and repair 

of the Building, consulting fees, engineering fees, attorneys fees and other losses” as a proximate 

result of Denk & Roche’s poor workmanship. 

¶ 9 B. Denk & Roche’s CGL Policy With Acuity

¶ 10 Acuity issued a CGL policy to Denk & Roche that obliged Acuity to “pay those sums that 

the insured becomes legally obligated to pay as damages because of *** property damage *** to 

which this insurance applies.” It further provided that Acuity “w[ould] have the right and duty to 

defend the insured against any suit seeking those damages.” Coverage applies under the policy to 

property damage that “is caused by an occurrence that takes place in the coverage territory” and 
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“occurs during the policy period.” The policy defines “occurrence” as “an accident, including 

continuous or repeated exposure to substantially the same general harmful conditions,” but does 

not define “accident.” It defines “property damage” to mean “[p]hysical injury to tangible 

property, including all resulting loss of use of that property,” as well as “[l]oss of use of tangible 

property that is not physically injured.” 

¶ 11 C. Procedural History 

¶ 12 Acuity filed this suit for declaratory judgment on October 10, 2013, naming as 

defendants the Association, Belgravia, the subcontractor Masonry Systems, and Denk & Roche. 

On July 14, 2015, Acuity moved for partial summary judgment for a declaration that it owed no 

duty to defend Belgravia or any of its subcontractors—including Denk & Roche—as named 

insureds under the CGL policies it issued.

¶ 13 Cincinnati petitioned to intervene on April 26, 2016, and the trial court later allowed it to 

intervene, over Acuity’s objections. On April 26, 2016, Cincinnati also filed its two-count thirdparty complaint for declaratory judgment against Acuity. In count I, Cincinnati asked for a 

declaration that Acuity “owe[d] a duty to defend Denk & Roche with respect to” the underlying 

case; in count II, it sought reimbursement under equitable contribution “for the proportionate 

share of defense fees and costs paid by Cincinnati which should have been paid by Acuity.” 

¶ 14 At various points in March through July 2017, counts against other defendants were 

dismissed, until the sole remaining issue in the case was Cincinnati’s claim against Acuity “for 

reimbursement of defense costs.” 

¶ 15 On March 8, 2017, Acuity moved to dismiss Cincinnati’s third-party complaint, arguing 

that Cincinnati lacked standing to seek a declaration regarding Acuity’s policy obligations to its 

insureds and that Cincinnati’s complaint failed to state a cause of action for equitable 
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contribution because the policies are consecutive, rather than concurrent, “and hence do not 

cover the same risks.” After hearing argument on Acuity’s fully briefed motion to dismiss, the 

trial court granted dismissal of count I (for a duty to defend declaration) but denied dismissal of 

count II (for equitable contribution) on July 18, 2017. 

¶ 16 On December 20, 2017, Acuity moved for summary judgment on the remaining count II 

in Cincinnati’s complaint, arguing that it had no obligation to contribute to Cincinnati because it 

had no duty to defend Denk & Roche. Acuity also claimed that, even if it had a duty to defend, 

Cincinnati had no right to equitable contribution because the two insurers did not insure the same 

risk. Cincinnati filed a cross-motion for summary judgment and opposition to Acuity’s motion 

for summary judgment. The parties briefed their motions, and the trial court heard argument on 

March 6, 2018. On that date, the trial court issued a one-page, handwritten order, granting 

summary judgment for Acuity and denying judgment for Cincinnati, finding that “the allegations 

of the underlying complaints did not allege damages caused by an occurrence” and “[a]s Acuity 

did not owe a duty to defend, Cincinnati is not entitled to equitable contribution.” 

¶ 17 II. JURISDICTION

¶ 18 Cincinnati timely filed its notice of appeal on April 4, 2018, challenging the trial court’s 

order of March 6, 2018. We have jurisdiction under Illinois Supreme Court Rules 301 and 303, 

governing appeals from final judgments entered by the circuit court in civil cases. Ill. S. Ct. R. 

301 (eff. Feb. 1, 1994); R. 303 (eff. Jan. 1, 2015). 

¶ 19 III. ANALYSIS

¶ 20 Summary judgment is appropriate when “the pleadings, depositions, and admissions on 

file, together with the affidavits, if any, show that there is no genuine issue as to any material fact 

and that the moving party is entitled to a judgment as a matter of law.” 735 ILCS 5/2-1005(c) 
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(West 2016). By filing cross-motions for summary judgment, the parties agree that there are no 

genuine issues of material fact, only a question of law is at issue, and invite the trial court to 

decide the issues based on the record. Milwaukee Mutual Insurance Co. v. J.P. Larsen, Inc., 

2011 IL App (1st) 101316, ¶ 7. 

¶ 21 The construction of an insurance policy is a question of law, subject to de novo review. 

Travelers Insurance Co. v. Eljer Manufacturing, Inc., 197 Ill. 2d 278, 292 (2001). In construing 

the language of the policy, the court’s primary objective is to ascertain and give effect to the 

intent of the parties to the contract. Id. “If the words of a policy are clear and unambiguous, ‘a 

court must afford them their plain, ordinary, and popular meaning.’ ” (Emphasis omitted.) Id. at 

292-93 (quoting Outboard Marine Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90, 108 

(1992)). “Conversely, if the language of the policy is susceptible to more than one meaning, it is 

considered ambiguous and will be construed strictly against the insurer who drafted the policy 

and in favor of the insured.” Id. at 293. “Construction of the policy should include ‘due regard to 

the risk undertaken, the subject matter that is insured and the purposes of the entire contract.’ ” 

Larsen, 2011 IL App (1st) 101316, ¶ 8 (quoting Outboard Marine, 154 Ill. 2d at 108). 

¶ 22 Cincinnati argues that the trial court erred in granting summary judgment to Acuity and 

declaring that Acuity owed Denk & Roche no duty to defend in the underlying suit. Cincinnati 

argues it is entitled to equitable contribution from Acuity for undertaking that defense and seeks 

a prove-up hearing to determine the proper amount of reimbursement under equitable 

contribution. We take each argument in turn. 

¶ 23 A. Duty to Defend 

¶ 24 “To determine an insurer’s duty to defend its insured, the court must look to the 

allegations of the underlying complaint and compare those allegations to the relevant coverage 
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provisions of the insurance policy.” Monticello Insurance Co. v. Wil-Freds Construction, Inc., 

277 Ill. App. 3d 697, 701 (1996). An insurer’s duty to defend arises if those allegations fall 

within, or potentially within, those coverage provisions. Viking Construction Management, Inc.

v. Liberty Mutual Insurance Co., 358 Ill. App. 3d 34, 41 (2005). “The allegations of the 

underlying complaint must be liberally construed in favor of the insured [citation], and any doubt 

about coverage should be resolved in favor of the insured [citation].” Pekin Insurance Co. v. 

Richard Marker Associates, Inc., 289 Ill. App. 3d 819, 821 (1997). 

¶ 25 Denk & Roche’s CGL policy with Acuity obligates the insurer to defend Denk & Roche

in any suit to recover for “property damages” caused by an “occurrence.” We must determine, 

therefore, whether the underlying complaint alleged such property damage from a covered 

occurrence. Larsen, 2011 IL App (1st) 101316, ¶ 17. 

¶ 26 The Acuity insurance policy is a CGL policy, which is intended “to provide coverage for 

injury or damage to the person or property of others [and not] to pay the costs associated with 

repairing or replacing the insured’s defective work and products, which are purely economic 

losses.” Richard Marker, 289 Ill. App. 3d at 822. “A CGL policy ‘does not cover an accident of 

faulty workmanship but rather faulty workmanship which causes an accident.’ ” Id. at 823 

(quoting Western Casualty & Surety Co. v. Brochu, 105 Ill. 2d 486, 498 (1985)). 

¶ 27 “Property damage” is defined under the policy as either “[p]hysical injury to tangible 

property, including all resulting loss of use of that property,” or “[l]oss of use of tangible 

property that is not physically injured.” Our supreme court has held that “property damage” in a 

CGL policy does not include “[p]urely economic losses, such as damages for inadequate value, 

costs of repair or replacement, and diminution in value that result from a product’s inferior 

quality or its failure to perform for the general purposes for which it was manufactured and sold 
No. 1-18-0743 

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*** absent physical injury to tangible property.” (Internal quotation marks omitted.) Eljer, 197 

Ill. 2d at 312. 

¶ 28 The CGL policy defines an “occurrence” is defined as “an accident, including continuous 

or repeated exposure to substantially the same general harmful conditions.” Although “accident” 

is not defined in the policy, Illinois courts have consistently defined it as “an unforeseen 

occurrence, usually of an untoward or disastrous character or an undesigned sudden or 

unexpected event of an inflictive or unfortunate character.” (Internal quotation marks omitted.)

Larsen, 2011 IL App (1st) 101316, ¶ 26; Stoneridge Development Co. v. Essex Insurance Co., 

382 Ill. App. 3d 731, 749 (2008); Country Mutual Insurance Co. v. Carr, 372 Ill. App. 3d 335, 

340 (2007); State Farm Fire & Casualty Co. v. Tillerson, 334 Ill. App. 3d 404, 409 (2002). 

“Where the defect is no more than the natural and ordinary consequences of faulty workmanship, 

it is not caused by an accident.” Tillerson, 334 Ill. App. 3d at 409. 

¶ 29 We have repeatedly recognized that while a CGL policy will not insure a contractor for

the cost of correcting construction defects, “damage to something other than the project itself 

does constitute an ‘occurrence’ under a CGL policy.” (Emphasis in original.) Larsen, 2011 IL 

App (1st) 101316, ¶ 27 (citing CMK Development Corp. v. West Bend Mutual Insurance Co., 

395 Ill. App. 3d 830, 832 (2009), citing Stoneridge, 382 Ill. App. 3d at 752). And damage that is 

not “merely associated with the repair or replacement” of the insured’s faulty work is “property 

damage” under the CGL policy. Id. ¶ 21. 

¶ 30 A number of the cases cited by the parties examine whether there was any allegation of 

an occurrence or of property damage in the context of a suit to determine an insurer’s obligation 

to defend a developer, general contractor, construction manager, or other firm tasked with 

constructing or supervising construction of an entire building. See, e.g., CMK Development, 395 
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Ill. App. 3d at 832; Stoneridge, 382 Ill. App. 3d at 733; Viking, 358 Ill. App. 3d at 36; Wil-Freds, 

277 Ill. App. 3d at 699. In that context, the answer turns on whether the complaint for which the 

CGL insurer is asked to defend alleges damage to property that is not any part of the construction 

project. CMK Development, 395 Ill. App. 3d at 840; Stoneridge, 382 Ill. App. 3d at 753; Viking, 

358 Ill. App. 3d at 55-56; Wil-Freds, 277 Ill. App. 3d at 705-06. 

¶ 31 In our view, the duty to defend Denk & Roche turns on a slightly different question: what 

qualifies as damage beyond “the project itself” and therefore as an occurrence and property 

damage, where the insured is a subcontractor performing discrete work on a project and that 

subcontractor has no control over or contractual obligation regarding other aspects of the 

project? The parties offer quite different answers to this question. 

¶ 32 Cincinnati argues that the Belgravia complaint “stated contribution/construction 

negligence causes of action against Denk & Roche, *** whose work allegedly caused or 

contributed to the conditions and defects on and within the building envelope.” And these issues, 

as alleged in the Association complaint, “interfered with the habitation and usage of the common 

elements and individual condominium units in the building,” and thus alleged an occurrence 

causing property damage under the policy. Cincinnati relies heavily on our decision in Larsen, 

2011 IL App (1st) 101316, arguing it is “factually analogous, directly on point, and 

determinative of the argument.”

¶ 33 In that case, Larsen was hired as a subcontractor to apply window sealant to windows 

installed by another contractor. Id. ¶ 3. The windows subsequently leaked, causing water damage 

to “condominium common elements, individual units and unit owners’ personal property.” Id.

¶¶ 3, 20. We held that this complaint alleged “not merely construction defects, which would 

constitute economic losses not covered under the CGL policy” but, rather, damage to other 
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property. Id. ¶ 21. The damage alleged was not limited to that damage “merely associated with 

the repair or replacement of the faulty window caulking and sealant.” Id. The damage alleged 

was “imputed to Larsen through his negligent workmanship [and] included personal property and 

water damage throughout a building not constructed by Larsen.” (Emphasis added.) Id. ¶ 28. 

Relying on Viking, 358 Ill. App. 3d at 37, and Richard Marker, 289 Ill. App. 3d at 822, we held 

that damage to other materials not furnished by the insured constituted both “property damage” 

and an “occurrence,” triggering coverage under a CGL policy. 

¶ 34 Acuity offers a bevy of cases in which Illinois courts have held that damages that are the 

“natural and ordinary consequence” of poor workmanship cannot be an accident, and therefore 

not an occurrence under a CGL policy, and that the costs to repair defective work are economic 

losses that cannot constitute property damage. See, e.g., Stoneridge, 382 Ill. App. 3d at 753; 

Viking, 358 Ill. App. 3d at 56; Wil-Freds, 277 Ill. App. 3d at 706; Indiana Insurance Co. v. 

Hydra Corp., 245 Ill. App. 3d 926, 930 (1993). As stated above, these cases involved allegations 

against either a developer, a general contractor supervising construction, or a sole contractor 

performing the only work at a given construction site. They do not address the issue here, where 

a subcontractor’s allegedly poor workmanship caused damage to the overall project and 

individual condo units within the building—damage that went beyond the scope of its own work. 

¶ 35 Acuity attempts to distinguish Larsen by arguing it “is nothing more than a case where 

damage to something other than the building the insured worked on triggered coverage.” In 

Acuity’s reading, “the presence of damage to the condominium owners’ personal property was 

the controlling fact in triggering the duty to defend,” and no such allegations of “other property” 

damage are alleged in the Association or Belgravia complaints against Denk & Roche.

¶ 36 We agree that, in Larsen, the allegation of damage to condominium owners’ personal 
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property was part of the basis of our holding. Id. ¶¶ 20, 21, 28. However, in Larsen, we viewed 

the damage to “common elements, individual units and personal property” as “property damage” 

that could trigger coverage under the CGL policy. (Emphasis added.) Id. The point we made 

there is that the allegation was more than one that “the window sealant and caulking were 

defective,” and we treated all of the “property damage,” whether to other aspects of the 

construction project or to the condominium owners’ personal property, as a basis for finding 

coverage. Id.

¶ 37 Acuity emphasizes that it is completely foreseeable that a construction defect will cause 

damage to other elements of the construction project and that such natural and ordinary 

consequences of defective construction cannot be treated as an “occurrence” under a CGL 

policy. However, as we recognized in Larsen, while “there is no occurrence when a 

subcontractor’s defective workmanship necessitates removing and repairing work” “[t]his court 

has repeatedly stated that damage to something other than the project itself does constitute an 

occurrence under a CGL policy.” (Emphasis omitted and internal quotation marks omitted.) Id.

¶¶ 26-27. This damage to “something other than the project” included “water damage throughout 

a building not constructed by Larsen.” Id. ¶¶ 27-28. 

¶ 38 From the eyes of the subcontractor, the “project” is limited to the scope of its own work, 

and the precise nature of any damage that might occur to something outside of that scope is as 

unknown or unforeseeable as damage to something entirely outside of the construction project. 

The portions of the construction project that are completely outside the scope of the 

subcontractors’ responsibility seem to us very similarly situated (from the subcontractors’ point 

of view) to the “carpeting, drywall, antique furniture, clothing, personal mementoes and 

pictures,” of unit owners, as to which we long ago recognized allegations of damage would 
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trigger a duty to defend. Richard Marker, 289 Ill. App. 3d at 820. 

¶ 39 Although Larsen is the only Illinois subcontractor CGL coverage case of which we are 

aware, in two cases (not cited by the parties), federal courts applying Illinois law have also found 

coverage when an insured’s poor workmanship caused damage to the project beyond the scope 

of the insured’s own work. In Ohio Casualty Insurance Co. v. Bazzi Construction Co., 815 F.2d 

1146 (7th Cir. 1987), the United States Court of Appeals for the Seventh Circuit interpreted 

Illinois law to find that a CGL insurer owed its insured contractor a defense against allegations 

that the insured negligently poured concrete for the second floor of an existing structure, causing 

the joists to buckle and become dangerous. Id. at 1148. Relying on our supreme court’s decision 

in Brochu, 105 Ill. 2d at 498, the court in Bazzi drew an important distinction about this 

construction project: 

“Had Bazzi contracted to construct an entirely new building for [the owner], any damage 

to or defects in that building, which would be defined as the property or work product of 

Bazzi, would not be covered under the policy. But that is not the case now before us. 

Because the [owner’s] complaint alleges damage to property other than Bazzi’s own work 

or product, namely the structure of the existing garage, the district court properly 

concluded that the [underlying complaint] states a claim for property damage that is 

potentially within the coverage of the insurance policy.” (Emphasis added.) Bazzi, 815 

F.2d at 1148-49. 

¶ 40 The United States District Court for the Northern District of Illinois, Eastern Division, 

came to a similar result in Westfield Insurance Co. v. National Decorating Service, Inc., 147 F. 

Supp. 3d 708 (N.D. Ill. 2015), aff’d, 863 F.3d 690 (7th Cir. 2017), a case nearly identical in 

factual posture to this one. The court noted from the outset that it was an “unsettled” question in 
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Illinois whether there is “an ‘occurrence’ under standard-form [CGL] policies when the named 

insured contractor’s faulty workmanship causes damage to a building that is beyond the scope of 

its own work there.” Id. at 709. The condominium association for a 24-story building sued the 

general contractor (among others) in state court, alleging construction defects that caused 

damages such as cracking of concrete walls, leakage through exterior walls, defects to common 

elements, and damage to interior ceilings, floors, painting, drywall, and furniture in the units. Id.

at 711. The general contractor filed a third-party complaint against subcontractor National 

Decorating, alleging its faulty workmanship damaged “the work of other trades on the project, 

specifically resulting in the peeling and cracking of drywall.” (Internal quotation marks omitted.) 

Id. Westfield filed a declaratory action in federal court over whether it owed National Decorating 

a defense in the underlying action. Id. at 710. 

¶ 41 The court in National Decorating construed the same CGL provisions at issue here and 

relied on both Bazzi, 815 F.2d 1146, and Larsen, 2011 IL App (1st) 101316, to find that 

Westfield owed the subcontractor a duty to defend. National Decorating, 147 F. Supp. 3d at 714-

15. The court reasoned that “coverage depended on the scope of the subcontractor’s work as the 

named insured.” Id. at 715. 

¶ 42 We recognize that there is at least one federal district court that has gone the other way, 

reading Larsen and other Illinois cases as holding that “[d]amage to a structure that results from 

its defective construction is” “not caused by an ‘occurrence’ within the meaning of a CGL 

policy, regardless of whether the insured contractor is responsible for all or just a portion of the 

building project.” Acuity v. Lenny Szarek, Inc., 128 F. Supp. 3d 1053, 1062 (N.D. Ill. 2015).

However, we find the reasoning of National Decorating and Bazzi more persuasive on this issue. 

¶ 43 We agree with these cases and Larsen that, when an underlying complaint alleges that a 
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subcontractor’s negligence caused something to occur to a part of the construction project 

outside of the subcontractor’s scope of work, this alleges an occurrence under this CGL policy 

language, notwithstanding that it would not be an occurrence from a general contractor or 

developer’s perspective. Larsen, 2011 IL App (1st) 101316, ¶ 27. 

¶ 44 Acuity also argues, in a footnote, that the holding in Larsen “is now suspect,” given this 

court’s more recent decision in Westfield Insurance Co. v. West Van Buren, LLC, 2016 IL App 

(1st) 140862, that allegations by a condominium association of damage even to unit owners’ 

personal property do not trigger a duty to defend. While the analysis in West Van Buren differs 

somewhat from that in Larsen, West Van Buren does not address a subcontractor situation and is 

not directly on point here. In our view, the reasoning in Larsen is in keeping with the well-settled 

precedent on which it relied—namely, that when a complaint alleges an insured contractor’s 

faulty workmanship caused damage to other property, there is a duty to defend. See Larsen 2011 

IL App (1st) 101316, ¶ 27; West Van Buren, 2016 IL App (1st) 140862, ¶¶ 30-42 (Pucinski, J., 

dissenting). We follow that reasoning here and reverse the summary judgment ruling for Acuity.

¶ 45 B. Equitable Contribution 

¶ 46 Cincinnati argues that it was entitled to summary judgment on its claim for equitable 

contribution and the matter should have been set for prove-up regarding the exact amount of 

costs to be reimbursed. Acuity argues that, even if it did have a duty to defend Denk & Roche, 

Cincinnati would have no right to contribution in this case because their two policies could not 

cover the same risks where they applied to different coverage periods. 

¶ 47 “Contribution as it pertains to insurance law is an equitable principle arising among 

coinsurers which permits one insurer who has paid the entire loss, or greater than its share of the 

loss, to be reimbursed from other insurers who are also liable for the same loss.” Home 
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Insurance Co. v. Cincinnati Insurance Co., 213 Ill. 2d 307, 316 (2004). To recover under this 

theory, “the insurer seeking contribution must prove: (1) all facts necessary to the claimant’s 

recovery against the insured; (2) the reasonableness of the amount paid to the insured; and (3) an 

identity between the policies as to parties and insurable interests and risks.” Schal Bovis, Inc. v. 

Casualty Insurance Co., 315 Ill. App. 3d 353, 362 (2000). 

¶ 48 “Contribution applies to multiple, concurrent insurance situations and is only available 

where the concurrent policies insure the same entities, the same interests, and the same risks.” 

Home Insurance, 213 Ill. 2d at 316. However, 

“ ‘[i]t is not necessary that the policies provide identical coverage in all respects in order 

for the two policies to be considered concurrent, and each insurer entitled to contribution 

from the other; as long as the particular risk actually involved in the case is covered by 

both policies, the coverage is duplicate, and contribution will be allowed.’ ” Schall Bovis, 

315 Ill. App. 3d at 363 (quoting 15 Couch on Insurance § 218:6 (3d ed. 1999)). 

¶ 49 Cincinnati argues that it and Acuity “share an identity of risks” for purposes of equitable 

contribution, in that they “provided [CGL] insurance to Denk & Roche through primary policies 

issued for the period of January 2000 to June 2007 [from Cincinnati] and June 2007 to December 

2012 [from Acuity].” Acuity responds that “the policies issued by Acuity and Cincinnati are not 

concurrent,” but rather “are consecutive.” It insists, without citation to authority, that consecutive 

policies cannot insure the “same risk” when the coverage period is a defined term in each policy 

and the two periods do not overlap. 

¶ 50 The parties’ dispute on the “concurrent policies” question largely focuses on this court’s 

decision in Continental Casualty Co. v. Security Insurance Co. of Hartford, 279 Ill. App. 3d 815, 

820 (1996). However, the holding in Continental Casualty did not turn on an analysis of the 
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coverage periods but, rather, on the fact that both policies were primary rather than excess 

insurance, and “as such, provided coverage to the insureds on the same basis.” Id.

¶ 51 Insurance policies in Illinois need not temporally overlap in order to cover the same risk 

for purposes of equitable contribution. In Liberty Mutual Insurance Co. v. Lumbermens Mutual 

Casualty Co., 525 F. Supp. 2d 993, 996 (N.D. Ill. 2007), the United States District court for the 

Northern District of Illinois, Eastern Division, construed settled Illinois law to find that class 

action allegations spanning consecutive, nonoverlapping policy periods nonetheless stated a 

claim for equitable contribution of defense costs. See also Zurich Insurance Co. v. Raymark 

Industries, Inc., 145 Ill. App. 3d 175, 180, 197 (1986), aff’d, 118 Ill. 2d 23 (1987). Acuity has 

offered no authority for its claim that the policy periods must be identical or even overlap to 

cover the same risk. 

¶ 52 We have ruled that the claims against Denk & Roche were within, or potentially within, 

Acuity’s policy coverage, entitling the subcontractor to a defense from Acuity. Cincinnati is 

therefore entitled to equitable contribution from Acuity for undertaking the subcontractor’s 

defense. The exact amount of contribution is a question for the trial court to answer in the first 

instance. We therefore remand for further proceedings consistent with this opinion. 

¶ 53 IV. CONCLUSION

¶ 54 For the reasons stated in this opinion, we reverse the grant of summary judgment for 

Acuity, find that Acuity owed its insured Denk & Roche a duty to defend in the underlying 

construction litigation, and remand for further proceedings to allow Cincinnati to have a chance 

to prove-up the amount of contribution to which it is entitled. 

¶ 55 Reversed and remanded.