Court Opinion

ID: 3147246
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:28:25.134725+00
Date Added: 2024-06-11T12:08:11.015822
License: Public Domain

SIXTH DIVISION
                                                                             December 17, 2010

No. 1-09-1905

LIBERTY MUTUAL FIRE INSURANCE COMPANY,                                )
                                                                      )
       Plaintiff and Counterdefendant/Appellee,                       )
                                                                      )          Appeal from
                v.                                                    )          the Circuit Court
                                                                      )          of Cook County
WOODFIELD MALL, L.L.C., Woodfield Associates, L.L.C., Taub-Co         )
Management, Inc., improperly sued as The Taubman Company, L.L.C., and )          07 CH 08457
Taub-Co Management, Inc.,                                             )
                                                                      )          Honorable
       Defendants and Counterplaintiffs/Appellants                    )          Sophia H. Hall,
                                                                      )          Judge Presiding.
(Nina Swanson, as Administrator of the Estate of Mark Swanson,        )
Deceased,                                                             )
                                                                      )
       Defendant/Counterdefendant).                                   )

       JUSTICE McBRIDE delivered the opinion of the court:

       Nina Swanson, of McHenry, Illinois, filed a wrongful death and survival action against the

owners and managers of a large suburban shopping mall near Chicago, alleging their negligence in

2004 killed her husband Mark Swanson. Mark Swanson was a heating and air conditioning

equipment technician dispatched to the mall by his employer, Carrier Corporation, to service the

air conditioning equipment for one of the mall’s tenants. Mark Swanson left the tenant’s space,

went into “an interior corridor” of the mall where he accessed the equipment on the roof, and as

he was climbing back inside the building, he fell to the concrete floor 10-feet below, allegedly due

to an inordinate 28-inch gap between the roof hatch and the top rung of an affixed ladder. Nina

Swanson sued the mall, but not its tenant. The mall, however, tendered the complaint to the
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tenant’s commercial general liability insurer, which determined it had no duty to defend the mall

and then prevailed on crossmotions for summary judgment in this declaratory judgment action.

On appeal, the mall contends the trial court made multiple errors in its choice-of-law analysis,

should have found the injuries arose from the tenant’s “work” or “premises” which entitled the

mall to additional insured coverage, should have recognized the lease contractually entitled the

mall to primary insured coverage, and should have determined the insurer waived policy defenses.

       The following undisputed facts are relevant to those arguments. The tenant’s commercial

general liability insurance policy for the one-year term beginning February 1, 2004, was issued by

plaintiff insurer Liberty Mutual Fire Insurance Company, a Massachusetts corporation with a

principal place of business in Massachusetts (Liberty Mutual). The named insureds include

Luxottica U.S. Holdings Corporation, which is a Delaware corporation, a subsidiary of an Italian

company, and the parent corporation of at least 33 United States corporations (Luxottica).

Luxottica has a mailing address in Port Washington, New York. Luxottica’s various subsidiaries

were also listed on the written policy as named insureds and included the mall’s tenant,

LensCrafters, Inc., which was an Ohio corporation headquartered near Cincinnati in Mason, Ohio

(LensCrafters). LensCrafters operates an extensive, nationwide chain of hundreds of retail

eyeglass stores and in 1986 began leasing retail space from the mall defendants at Woodfield Mall

in Schaumburg, Illinois. The insurance policy did not list the addresses of the individual

LensCrafters stores; however, under the heading “Classifications and Locations,” the coverage

encompassed “All Operations of the Named Insured.” None of the mall defendants was listed as

a named insured in the policy declarations or appeared on the policy’s “Named Insured

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Endorsement” page or any where else in the contract. The mall defendants, meaning the four

defendants named in Swanson’s negligence action, were Woodfield Mall, L.L.C., a foreign

corporation which owns the mall in Schaumburg; Woodfield Associates, L.L.C., an Illinois

corporation; The Taubman Company, L.L.C., a foreign corporation which manages the mall; and

Taub-Co Management, Inc., another foreign corporation.

       A “General Amendatory Endorsement” to the policy stated in relevant part:

                       “L. AMENDMENT -- BLANKET ADDITIONAL INSURED

                       SECTION II - WHO IS AN INSURED is amended to include as an

               insured any person, organization, state or other political subdivision, trustee or

               estate for whom you have agreed in writing to provide liability insurance. But:

                       The insurance provided by this amendment:

                       1. Applies only to ‘personal injury’ or ‘property damage’ arising out of (a)

               ‘your work’ or (b) premises or other property owned by or rented to you[.]”

       The policy specified, “the words ‘you’ and ‘your’ refer to the Named Insured shown in the

Declarations, and any other person or organization qualifying as a Named Insured under this

policy.” Section 11.01 of LensCrafters’ lease required it to name the owners and managers of

Woodfield Mall as additional insureds on its comprehensive liability policy “with respect to the

leased premises and the operations of Tenant and any subtenants of Tenant in, on or about the

leased premises” and that “the coverage evidenced thereby shall be primary and non-contributing

with respect to any policies carried by [the owners and managers of the mall], and that any

coverage carried by [the owners and managers] shall be excess insurance.” Thus, when the lease

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and policy are read together, the mall defendants are additional insureds on LensCrafters’ policy,

but only for personal injury or property damage arising out of LensCrafters’ premises and

operations at Woodfield Mall.

       The preamble and section 1.01 of the lease defined the “Leased Premises” as “Store

Number 330, situated on the upper level of Building ‘D’, having an irregular shape and consisting

of approximately 5,561 square feet.” A letter agreement that was simultaneously executed with

the lease described the “‘leased premises’ ” as “space *** in the Shopping Center to be known as

Woodfield Mall.” (Emphasis added.) The lease was modified in 1996 to extend the rental period

for an additional 10 years through November 30, 2006, and the renewal stated the original lease

was “for a retail business to be operated under the trade name ‘LENSCRAFTERS,’ covering

premises identified as Store No. ‘D-330’, in the regional retail development commonly known as

WOODFIELD MALL.” (Emphasis added.) Also relevant is section 1.01 of the original lease,

which specified:

                       “(b) The exterior walls and the roof of the leased premises and the area

               beneath said premises are not demised hereunder, and the use thereof, together

               with the right to locate, both vertically and horizontally, install, maintain, use,

               repair and replace pipes, utility lines, ducts, conduits, flues, refrigerant lines,

               drains, sprinkler mains and valves, access panels, wires and structural elements

               leading through the leased premises serving other parts of the Shopping Center, is

               hereby reserved unto Landlord. Landlord reserves an easement above Tenant’s

               finished ceiling to the roof, or to the bottom of the floor deck above the leased

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               premises, for general access purposes and in connection with the exercise of

               Landlord’s other rights under this Lease.”

The preamble and section 7.01 of the lease limited the tenant’s “Permitted Use” and “Use of

Premises” to “The retail sale of eyeglasses, contact lenses, solutions and all optical accessories

related to the retail optical business; in addition, the on-premises professional optometric eye

examination business and the on-premises manufacturing of prescription eyeglass lenses and

contact lenses.”

       The lease also addressed the operation and maintenance of the shopping center’s common

areas. Section 8.02 defined the “ ‘common areas’ ” to include “stairs ***not contained within any

leased premises” and “service and fire and exit corridors.” In section 8.01, the landlord “agree[d]

to cause to be operated and maintained *** all common areas within the Shopping Center” and

specified that the “manner in which such areas and facilities shall be operated and maintained ***

shall be at the sole discretion of Landlord.” In section 10.01, the landlord agreed to “keep and

maintain the roof (including the structural integrity thereof), foundation and exterior surfaces of

the exterior walls of the building in which the leased premises are located *** in good order,

condition and repair.”

       In section 10.02, LensCrafters agreed to “keep and maintain in first class appearance ***

and in good order, condition and repair as determined by Landlord *** the leased premises and

every part thereof and any and all appurtenances thereto wherever located but exclusively serving

the leased premises, including, but without limitation, *** ventilation, heating and air conditioning

and electrical systems (whether or not located in the leased premises but exclusively serving the

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leased premises), sprinkler systems, walls, floors and ceilings.” Beginning in 2004, LensCrafters

entered into a three-year HVAC preventive maintenance and repair service contract with Carrier

Corporation which encompassed LensCrafters numerous retail outlets. In accordance with this

contract, the LensCrafters store in Woodfield Mall contacted Carrier Corporation when the air

conditioning in its lab stopped working and Carrier Corporation sent its employee Mark Swanson

to investigate and fix the problem.

       Also relevant is that in section 11.03 of the lease, LensCrafters agreed to indemnify the

mall defendants and “save them harmless (except for loss or damage resulting solely from the

negligence of Landlord or breach of this Lease by Landlord) from and against any and all claims.”

       After Liberty Mutual was notified of Mark Swanson’s accident and untimely death, it sent

a letter to the mall defendants in 2005 stating “we cannot determine at this time whether there is a

potential of coverage [for the mall defendants] under the policy” and “will be continuing our

investigation into this claim under a reservation of rights.” The letter summarized what occurred

at the shopping center and set out the portions of the General Amendatory Endorsement (quoted

above) which indicated when additional insured status would occur and that the scope of

coverage was expressly limited to “ ‘personal injury’ or ‘property damage’ arising out of (a) “[the

named insured’s] work or (b) premises or other property owned by or rented to [the named

insured].” The insurance company’s letter continued:

                       “The lease between the Mall and LensCrafters requires LensCrafters to

               provide additional insured status to the Mall. As a result, the Mall is an insured

               but only with respect to liability arising out of the premises leased to LensCrafters.

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               We cannot determine from the information we currently have whether the Mall’s

               liability arose from the premises leased to LensCrafters. We will be conducting

               further investigation into that issue.”

The letter concluded with reservation-of-rights language: “While we have attempted to address

all of the coverage issues related to this claim, Liberty Mutual reserves all rights under applicable

law and the policy. This letter should not be construed as a waiver or estoppel of any possible

coverage defenses afforded by the policy or applicable law.” A nearly identical letter sent on

November 13, 2006, will be set out below in conjunction with one of the mall’s arguments for

reversal. In that letter, Liberty Mutual agreed to provide a defense. However, on March 26,

2007, it filed this action seeking a declaration of no duty to defend or indemnify and alleging in

part that Ohio law would govern any dispute about the parties’ rights and obligations. The mall

defendants counterclaimed.

       Discovery in this coverage action included deposing Sebastian DiBella, an account

executive employed by the insurance brokerage and consulting firm BWD Group, L.L.C. (BWD),

located in Jericho, New York. DiBella indicated BWD had been handling Luxottica’s insurance

coverage for about 15 years and that he helped the company evaluate its needs and negotiate the

coverage terms and cost of the insurance policy at issue. DiBella’s primary contacts at Luxottica

were Jim Bettner, who was their director of risk management, and Bettner’s boss, Greg Muntel.

DiBella made recommendations to Muntel and Bettner and those gentlemen made the decisions.

DiBella acknowledged that Luxottica’s address in Port Washington, New York, appeared on the

declarations page of the insurance policy, but explained that Liberty Mutual sent the proposed

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policy directly to BWD, BWD reviewed it, and then DiBella personally delivered it to Muntel and

Bettner during a meeting at the Luxottica office in Mason, Ohio. After the meeting, DiBella

negotiated additional terms with Liberty Mutual’s employees Terry Schell, who was an account

executive in Cincinnati, Ohio, and/or Joanne Venuti, who was a national accounts underwriter in

Boston, and then Liberty Mutual bound the coverage.

       DiBella’s deposition transcript was one of the documents considered by the trial court in

the summary judgment proceedings. As we stated above, Liberty Mutual prevailed on the cross-

motions for summary judgment and this appeal by the mall followed.

       Summary judgment is properly granted where the pleadings, deposition transcripts, and

admissions on file, together with any affidavits and exhibits, when viewed in the light most

favorable to the nonmoving party, indicate that there is no genuine issue of material fact and that

the moving party is entitled to judgment as a matter of law. 735 ILCS 5/2-1005(c)) (West 2006).

Summary judgment is a drastic means of disposing of litigation, but is an appropriate measure in

cases meeting these criteria. Crum & Forster Managers Corp. v. Resolution Trust Corp., 156 Ill.

2d 384, 390-91, 620 N.E.2d 1073, 1077 (1993). Appeals from the entry of summary judgment

are addressed de novo by this court. Crum & Forster, 156 Ill. 2d at 390, 620 N.E.2d at 1077.

       The mall’s first specific argument is that the trial court erred in determining Ohio rather

than Illinois or New York had the “most significant contacts” with the insurance policy and would

control the interpretation of the parties’ rights and obligations under the contract. Often

insurance policies contain express choice-of-law provisions, but when a policy is silent, its

provisions are governed by the substantive law of (1) the location of the subject matter, (2) the

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domicile of the insured or of the insurer, (3) the place of the last act to give rise to an enforceable

contract, (4) the place of performance, or (5) any other place bearing a rational relationship to the

contract. Lapham-Hickey Steel Corp. v. Protection Mutual Insurance Co., 166 Ill. 2d 520, 526-

27, 655 N.E.2d 842, 845 (1995). These factors do not have equal significance and are to be

weighed according to the issue involved. Emerson Electric Co. v. Aetna Casualty & Surety Co.,

319 Ill. App. 3d 218, 232, 743 N.E.2d 628, 640 (2001). At least some of the factors in a choice-

of-law analysis “will point in different directions in all but the simplest case.” Restatement

(Second) of Conflict of Laws §6, Comment c, at 12 (1971). “Hence, any rule of choice of law,

like any other common law rule, represents an accommodation of conflicting values.”

Restatement (Second) of Conflict of Laws §6, Comment c, at 12 (1971). A choice-of-law

analysis should consider the contracting parties’ justified expectations, yield certain, predictable,

and uniform results, and avoid inconsistent interpretations of the same insurance contract.

Emerson Electric, 319 Ill. App. 3d at 232, 743 N.E.2d at 640.

        The mall argues the location of the contract’s subject matter is the insured risk in Illinois

and this fact should be given extra emphasis. The mall relies on Diamond State Insurance Co. v.

Chester-Jensen Co., 243 Ill. App. 3d 471, 488-89, 611 N.E.2d 1083, 1095 (1993), and Society of

Mount Carmel v. National Ben Franklin Insurance Co. of Illinois, 268 Ill. App. 3d 655, 664, 643

N.E.2d 1280, 1287 (1994), in which the courts construed the state where liability arose to be the

location of the insured risk and worthy of greater weight than any other single contact under

consideration. The courts noted parenthetically that under this approach, a policy which insured

risks located in “several” or “different” states would be treated as separate policies each insuring a

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separate risk. Diamond State, 243 Ill. App. 3d at 489, 611 N.E.2d at 1095; Society of Mount

Carmel, 268 Ill. App. 3d at 665, 643 N.E.2d at 1287. We consider these cases distinguishable, in

that the risks insured there appear to be limited to a few tangible products or to a few specific

locations that were itemized in the policy, while the insured risk in this case is the operations and

premises of a national chain store with retail locations too numerous to be listed in the insurance

policy. Moreover, the courts’ parenthetical remarks in Diamond State and Society of Mount

Carmel were based on a passage from the Restatement (Second) of Conflict of Laws, which

indicates:

                       “A special problem is presented by multiple risk policies which insure

               against risks located in several states. A single policy may, for example, insure

               dwelling houses located in states X, Y and Z. These states may require that any

               fire insurance policy on buildings situated within their territory shall be in a special

               statutory form. If so, the single policy will usually incorporate the special

               statutory forms of the several states involved. Presumably, the courts would be

               inclined to treat such a case, at least with respect to most issues, as if it involved

               three policies, each insuring an individual risk.” (Emphasis added.) Restatement

               (Second) of Conflict of Laws §193, Comment f, at 613-14 (1971).

Diamond State, 243 Ill. App. 3d at 488-89, 611 N.E.2d at 1095 (discussing Restatement

(Second) of Conflict of Laws, section 193); Society of Mount Carmel, 268 Ill. App. 3d at 665,

643 N.E.2d at 1287 (same). We do not consider the commentators’ reasoning or admitted mere

presumption about a policy insuring as few as three single-family homes to be relevant to the

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current commercial general liability policy insuring all the locations of a major, nationwide retail

chain. Accordingly, we decline to follow Diamond State, 243 Ill. App. 3d at 488-89, 611 N.E.2d

at 1095, or Society of Mount Carmel, 268 Ill. App. 3d at 665, 643 N.E.2d at 1287, and give

undue weight to the location of the insured risk in Illinois.

       Instead, the more pertinent analysis appears in Lapham-Hickey Steel, a subsequent

supreme court case concerning a policy broadly covering “all risks of physical loss or damage” at

a steel company’s facilities in six different states. Lapham-Hickey Steel, 166 Ill. 2d at 523, 655

N.E.2d at 843. Although its Minnesota facility was listed in the policy and was the site of the

environmental contamination at issue, the court determined the location of the insured risk in the

midwestern state was entitled to little weight because the broad policy covered risks in multiple

states and the contract expressed a choice of law in only two, limited instances. Lapham-Hickey

Steel, 166 Ill. 2d at 527, 655 N.E.2d at 845. On the other side of the scale were the facts that the

policy was delivered in Illinois by an Illinois brokerage to an Illinois corporation licensed to do

business in Illinois. Lapham-Hickey Steel, 166 Ill. 2d at 527, 655 N.E.2d at 845. The court

concluded that reasonable application of the choice-of-law factors and obtaining a “consistent

interpretation of the policy” dictated that Illinois law would govern. Lapham-Hickey Steel, 166

Ill. 2d at 527, 655 N.E.2d at 845.

       After the supreme court decided Lapham-Hickey Steel, Illinois courts have deemphasized

the location of the insured loss when the policy’s risks are spread nationwide. Lapham-Hickey

Steel, 166 Ill. 2d 520, 655 N.E.2d 842. For instance, in Emerson Electric, the parties disagreed

over whether Missouri or other states’ laws would control a coverage dispute about liability for

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environmental damage in 22 different states, where the insured was based in Ferguson, Missouri,

a suburb of Saint Louis, and had 40 divisions and subsidiaries doing business around the country.

Emerson Electric Co., 319 Ill. App. 3d at 223, 743 N.E.2d at 634. None of the pollution

occurred in the insured’s home state of Missouri. Emerson Electric, 319 Ill. App. 3d 218, 743

N.E.2d 629. The court reasoned: “Though the location of the insured risk is often seen as the

most important factor in this sort of analysis, that is not the case where, as here, the risk locations

are scattered through several states.” Emerson Electric, 319 Ill. App. 3d at 232, 743 N.E.2d at

640. Instead, the court looked for the location which appeared to be most likely contemplated by

the parties as the source of law and would also serve the interests of predicatability, uniformity of

result, and ease in determining and applying the law. Emerson Electric, 319 Ill. App. 3d at 235,

743 N.E.2d at 642. The court gave special emphasis to the Missouri corporation’s principle place

of business because it had an “active, dominan, and dynamic role in the procurement of all of

these policies.” Emerson Electric, 319 Ill. App. 3d at 235, 743 N.E.2d at 642.

               “According to the record, the procurement of insurance for both Emerson and its

               subsidiaries was largely coordinated out of Emerson’s corporate headquarters in

               St. Louis. Michael Zimmer worked at Emerson’s headquarters from 1964 to

               1986, starting as corporate insurance manager in Emerson’s treasury department,

               and later becoming head of Emerson’s newly formed insurance risk management

               department. *** His responsibilities included negotiating for the placement of

               insurance coverage, which required the gathering of information relating to

               Emerson’s various businesses which were to be covered. That information was

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               provided by Emerson’s various subsidiaries and divisions. Zimmer was the ‘point

               person’ for gathering this data, which was then reviewed with Emerson’s

               [Chicago] insurance broker. As companies were acquired by Emerson, Zimmer

               generally took on responsibility for their insurance, recommending ‘a program that

               would have typically involved their [the companies’] participation in Emerson’s

               corporate insurance risk program.’ ***

                       Since Emerson’s corporate treasury department and later its risk

               management department, both located at Emerson’s headquarters in St. Louis,

               figured so prominently in the procurement of insurance not only for Emerson but

               also for its subsidiaries, the location of Emerson’s headquarters in Missouri clearly

               merits significant weight in this analysis.” Emerson Electric, 319 Ill. App. 3d at

               235-36, 743 N.E.2d at 642.

The court also considered that the policy was personally delivered in Missouri, the insurance

contracts were kept in a safe in Missouri (the domicile of the insured), the policy payments took

place in Missouri (the last act to give rise to the contract), and the claims would be paid in

Missouri (the place of performance). Emerson Electric, 319 Ill. App. 3d at 233-35, 743 N.E.2d

at 639-641. Missouri was the location that tied the contracting parties together and was most

likely contemplated by them at the time of contracting to be controlling. Emerson Electric, 319

Ill. App. 3d at 234-35, 743 N.E.2d at 641-42. We acknowledge that Emerson Electric involved

environmental damage sites in multiple states, in contrast to Swanson’s action concerning one

accident in Illinois. Emerson Electric, 319 Ill. App. 3d 218, 743 N.E.2d 629. Nevertheless, the

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Emerson Electric and LensCrafters policies are similarly broad general liability contracts which

cover numerous locations, and the contracting parties could justifiably anticipate at the time of

contracting that the site of a specific loss would be given little weight.

        Lapham-Hickey Steel, not Diamond State or Society of Mount Carmel, was followed in

Westchester, a case involving two broad commercial umbrella policies, one insuring a national

brewing company and 50 other companies and the other insuring the national brewing company

and over 100 other companies. Westchester Fire Insurance Co. v. G. Heileman Brewing Co.,

321 Ill. App. 3d 622, 625, 747 N.E.2d 955, 958 (2001). After pointing out that the policies

provided general liability insurance for the brewing company everywhere it did business and

“were apparently designed to provide coverage without regard to location of risks,” the

Westchester court criticized the trial judge for relying on the “principal location of [the insured]

risk” analysis employed in Society of Mount Carmel. Westchester, 321 Ill. App. 3d at 632, 747

N.E.2d at 964; Society of Mount Carmel, 268 Ill. App. 3d 655, 643 N.E.2d 1280. The state

where the insured loss was located was not pertinent when the policies “covered risks nationwide

and did not specifically state the location of the risk.” Westchester, 321 Ill. App. 3d at 630, 747

N.E.2d at 962. Instead, like Emerson Electric, the court focused on the insured’s principal place

of business or “ ‘nerve center’ ” (Westchester, 321 Ill. App. 3d at 630, 747 N.E.2d at 962,

quoting Krueger v. Cartwright, 996 F.2d 928, 931 (7th Cir. 1993)), which it defined as “the

location of business decision making” and the “location of the offices responsible for the main

activities of the entity.” Westchester, 321 Ill. App. 3d at 630, 747 N.E.2d at 962, citing Illinois

Life & Health Insurance Guaranty Ass’n v. Boozell, 289 Ill. App. 3d 621, 682 N.E.2d 291

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(1997). The court also took into consideration the domicile of the insured, where the policy was

delivered to the brewing company (the last act giving rise to the contract), where the insurer’s

representative handling problems and complaints was located, and where the insurance broker

was located. Westchester, 321 Ill. App. 3d at 629, 747 N.E.2d at 962.

        Like these latter cases, the policy currently at issue covered risks which could arise any

where in the country and did not specifically state the location of the insured risks. Because

LensCrafters’ locations all over North America were covered, the “location of the risk” analysis

employed in Diamond State and Society of Mount Carmel would not be appropriate. Diamond

State, 243 Ill. App. 3d 471, 611 N.E.2d 1083; Society of Mount Carmel, 268 N.E.2d 655, 643

N.E.2d 1280. On the basis of this authority, we have also determined that the place where the

underlying action was filed “cannot be equated with the location of the [national] subject matter

or insured risk” and is entitled to “little or no significance to our analysis.” Westchester, 321 Ill.

App. 3d at 630, 747 N.E.2d at 962. LensCrafters is the entity we have focused on because the

coverage claim is based on the mall’s written lease with LensCrafters; the mall has no relationship

with the other named insureds which include the parent company Luxottica and sister

corporations in various parts of the United States. LensCrafters is a named insured and the

availability of coverage is not dependent upon its corporate affiliations. The record substantiates

that LensCrafters is domiciled in Mason, Ohio, and its insurance procurement occurred entirely in

that state. Muntel was the “ ‘point person’ ” (Emerson Electric, 319 Ill. App. 3d at 235, 743

N.E.2d at 642) who coordinated all the insurance needs of Luxottica’s numerous subsidiaries out

of his Ohio office. In addition, insurance broker DiBella traveled from his office in New York to

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hand deliver the policy to Muntel in Ohio. Emerson Electric, 319 Ill. App. 3d at 233, 743 N.E.2d

at 641 (considering location of policy delivery). The Ohio facility was also the headquarters and

“nerve center” for all of the LensCrafters stores. Westchester, 321 Ill. App. 3d at 630, 747

N.E.2d at 962 (considering location of decision making). The record does not disclose how the

insurance premiums were paid, but presumably they emanated from the Ohio headquarters, and

even if they did not, the mall has never contended it needed additional discovery time to unearth

this detail. Emerson Electric, 319 Ill. App. 3d at 233, 743 N.E.2d at 641 (considering location of

premium payments). Ohio has more significant contacts with this insurance contract than New

York or Illinois.

       The mall argues in the alternative that if we do not give extra emphasis to the purported

principal location of risk in Illinois, we should focus on the declarations page of the policy

indicating the contract was mailed to Luxottica’s address in New York. The mall argues this

shows the policy was delivered to the insured in New York and, therefore, that state’s laws

control interpretation of the policy provisions, rather than Ohio’s. The record, however, does not

show that the policy was delivered to the insured in New York. Insurance broker DiBella stated

without contradiction that he did not know why Luxottica’s New York address appeared on the

policy declarations page and that he had personally delivered the contract to Muntel in Ohio.

Thus, the record shows Ohio, not New York, was the place of delivery to the insured.

       Contradicting its contention that the policy was mailed to Luxottica in New York, the mall

next cites DiBella’s deposition transcript for the proposition that the policy was sent to DiBella in

New York. The mall characterizes this as the “last act that gave rise to the valid insurance

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contract.” (If this truly was the last act in the contracting process, the subsequent delivery to the

insured would be inconsequential and should not have been argued above.) The mall also

contends the payment of premiums occurred in New York. It concludes these circumstances

“creat[ed] another significant contact in favor of applying New York law.” We do not reach the

same conclusion. Although some courts have considered the location of an intermediary

insurance broker, the mall has failed to discuss any precedent to that effect and DiBella testified

that his role in the procurement process was to make recommendations only to his clients in Ohio,

Muntel and Bettner, who made the contracting decisions. Therefore, we fail to see the relevance

of the location of this particular broker in this choice-of-law analysis. And, again, the record does

not definitely indicate where premiums were paid, but the location of the insured’s headquarters

in Ohio and Muntel and Bettner’s presence there suggests the payments emanated in Ohio.

       Another unpersuasive argument is premised on the facts that LensCrafters is domiciled in

Ohio, Luxottica is domiciled in New York, Liberty Mutual is domiciled in Massachusetts, and

Liberty Mutual is licensed to do insurance business in “numerous other states.” The mall argues

that given all the options, we should defer to the New York domicile of the parent corporation,

Luxottica. As we explained above, details about the parent corporation are red herrings, and our

consideration of the contracting process led us to conclude Ohio was the linchpin state.

Furthermore, Liberty Mutual’s domicile in Massachusetts would be pertinent if this insurance

company played an active role in the contracting process, but it did not; and the fact that the

insurer is licensed to do business/enter into contracts in various jurisdictions has no apparent

relevance to any choice-of-law analysis. See Lapham-Hickey Steel, 166 Ill. 2d at 526-27, 655

                                                 17
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N.E.2d at 845 (choice-of-law analysis is based on facts having a rational relationship to the

insurance contract).

       The mall’s final argument regarding the choice-of-law issue is that since Swanson’s claim,

if successful, would be paid in Illinois, then contract performance would occur in Illinois. In our

opinion, even if insurance proceeds were paid in Illinois, this one factor would not outweigh the

combination of the other factors discussed above.

       For all these reasons, we conclude that Ohio has the most significant contacts with the

contract and the substantive law of that jurisdiction controls the interpretation of the policy

provisions.

       The mall’s second main argument on appeal is based on the policy language limiting its

additional insured coverage to injuries that are “arising out of (a) ‘your work’ or (b) premises or

other property owned by or rented to you,” where the policy defines “your” and “you” to mean

the named insured LensCrafters. Although the mall is asking us to interpret a policy provision, it

fails to cite Ohio authority and has therefore waived our consideration of this contention. Village

of Riverwoods v. BG Ltd. Partnership, 276 Ill. App. 3d 720, 729, 658 N.E.2d 1261, 1268 (1995)

(finding waiver where appellant failed to cite supporting authority). In any event, the mall’s

argument fails under the facts, Ohio authority, and the Illinois authority it relies upon.

       When construing an insurance contract, an Illinois court will give the parties’ words their

plain, ordinary, and generally accepted meaning. Continental Casualty Co. v. Donald T.

Bertucci, Ltd., 399 Ill. App. 3d 775, 776, 926 N.E.2d 833, 836 (2010).

       Davis indicates that under Ohio law, additional insured coverage extends only to vicarious

                                                  18
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liability for negligence of the named insured (Davis v. LTV Steel Co., 128 Ohio App. 3d 73, 716

N.E.2d 766 (1998)), and thus, Liberty Mutual has no duty to defend the mall from Swanson’s

action alleging the mall’s own negligent act or omission caused Mark Swanson’s injuries. In

Davis, LTV, a steel company, hired an industrial cleaning company, Shafer, to clean tar sumps at

an LTV facility in Warren, Ohio. Davis, 128 Ohio App. 3d at 734, 716 N.E.2d at 767. Their

contract required Shafer to purchase comprehensive general liability insurance and to name LTV

as an additional insured. Davis, 128 Ohio App. 3d at 735, 716 N.E.2d at 768. An endorsement

to the policy provided additional insured “ ‘only with respect to liability arising out of your

operations or premises owned by or rented to you’ ” (emphasis omitted) where “ ‘your’ ” and “

‘you’ ” referred to the named insured. Davis, 128 Ohio App. 3d at 736, 716 N.E.2d at 769. Two

of Shafer’s employees were injured on the job when they fell into an open sump, allegedly

because a protective grating had been removed, and they sued LTV for negligence in maintaining

its property. Davis, 128 Ohio App. 3d at 735, 716 N.E.2d at 768. LTV sought coverage under

the additional insured language, but lost a declaratory judgment action and an appeal. Davis, 128

Ohio App. 3d 733, 716 N.E.2d 766. LTV, like the mall defendants here, sought an expansive

interpretation of the phrase “ ‘arising out of’ ” in the additional insured endorsement. Davis, 128

Ohio App. 3d at 736, 716 N.E.2d at 769. The appellate decision indicates:

                       “LTV argues that the language of the additional-insured endorsement

               should be construed broadly so that LTV was protected from all liability arising

               out of or connected to the operations of Shafer, regardless of whether the liability

               was attributable to the negligence of LTV, Shafer, a third party, or some

                                                  19
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               combination thereof. We disagree with this interpretation of the additional-insured

               endorsement.

                       The plain language of the endorsement extended coverage to LTV only

               with respect to liability arising out of Shafer's operations or premises owned by or

               rented to Shafer. The phrase ‘arising out of your operations’ in the endorsement

               was intended to protect LTV from any liability for the negligence of Shafer's

               employees who would be performing the industrial cleaning at the LTV plant. See

               e.g., [Buckeye Union Insurance Co. v. Zavarella Brothers Construction Co., 121

               Ohio App. 3d 147, 151-52, 699 N.E.2d 127, 130-31 (1997).] In other words, the

               purpose of the additional-insured endorsement was to protect the additional

               insured ( i.e., LTV) from being vicariously liable for the tortious acts of the named

               insured ( i.e., Shafer).” Davis, 128 Ohio App. 3d at 736-37, 716 N.E.2d at 769.

       Davis was based in part on Buckeye Union Insurance, another Ohio case involving a

contractual obligation to obtain additional insured coverage. Buckeye Union Insurance, 121

Ohio App. 3d at 148, 699 N.E.2d at 128. When an employee of the named insured was injured

on the jobsite and sued the additional insured, the additional insured sought a defense under the

policy and later indemnification for the expenses it incurred defending the suit. Buckeye Union

Insurance, 121 Ohio App. 3d 147, 699 N.E.2d 127. An endorsement to the policy’s additional

insured clause is similar to the one at issue here and read:

               “ ‘WHO IS [AN] INSURED (Section II) is amended to include as an insured the

               person or organization shown in the Schedule *** but only with respect to liability

                                                  20
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                arising out of “your work” for that insured or by you.’ (Emphasis added.) In the

                context of this endorsement, the word ‘you’ refers to [the named insured].

                        We find, as a matter of law, that the additional-insured clause of the policy

                could only cover [the additional insured] for liability arising from [the named

                insured’s] work for [the additional insured]. If we were to read the additional-

                insured clause as permitting [the additional insured] to be insured against its own

                negligence, it would run counter to the public policy [of Ohio]. ***

                        We have no doubt that the additional-insured language of the policy

                permits no recovery [here]. The employee filed causes of action against [the

                additional insured] seeking damages for [the additional insured’s] negligence.

                Certainly, the employee’s causes of action *** did not relate to any negligence [by

                the named insured].” Buckeye Union Insurance, 121 Ohio App. at 151, 699

                N.E.2d at 130.

        This reasoning makes clear that the purpose of additional insured coverage is to protect

the additional insured from claims of vicarious liability, that is, liability based entirely on the

relationship between the two insureds, as opposed to any active negligence on the part of the

additional insured. Ohio law does not support the mall’s argument for reversal.

        The mall’s argument also fails under Illinois law. Citing Maryland Casualty, the mall

contends the policy language “ ‘arising out of’ ” requires a “but for” causation test and “but for”

the LensCrafters’ lease and its service call for HVAC maintenance, Mark Swanson would not

have been at Woodfield Mall on the day he was fatally injured. Maryland Casualty Co. v.

                                                   21
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Chicago & North Western Transportation Co., 126 Ill. App. 3d 150, 154, 466 N.E.2d 1091,

1094 (1984), quoting Western Casualty & Surety Co. v. Branon, 463 F. Supp. 1208, 1210 (E.D.

Ill. 1979) (“ ‘Arising out of”has been held to mean ‘originating from,’ ‘having its origin in,’

growing out of,’ and flowing from’ ”).

        The mall argues Mark Swanson’s injuries arose out of LensCrafters’ “work,” where the

policy defines “your work” as “Work or operations performed by you or on your behalf.”

(Emphasis added). The argument is a distortion of Maryland Casualty’s “but for” analysis.

Maryland Casualty, 126 Ill. App. 3d at 155, 466 N.E.2d at 1094. According to Swanson’s

complaint, Mark Swanson’s injuries occurred when he was performing HVAC maintenance and

repair on behalf of his employer, Carrier Corporation. The record tendered on appeal includes (a)

the contract obligating Carrier Corporation to “provide Heating/Ventilation/Air Conditioning

Preventative Maintenance and Repair Services” to LensCrafters, (b) business records indicating

Carrier Corporation inspected the store’s HVAC equipment and recommended replacement

rather than repair, and (c) the shopping center lease describing LensCrafters’ activities as “[t]he

retail sale of eyeglasses, contact lenses, solutions and all optical accessories related to the retail

optical business; in addition, the on-premises professional optometic eye examination business and

the on-premise manufacturing of prescription eyeglass lenses and contact lenses.” The mall’s

alleged liability does not stem from the sale of eyewear or contact lenses, eye examinations, or

lens manufacturing, by or on behalf of LensCrafters. Mark Swanson was performing Carrier

Corporation’s HVAC “work” rather than LensCrafters’ eyewear-related “work” when his

unfortunate accident occurred

                                                   22
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       Returning to the policy language, the mall also argues Mark Swanson’s injuries arose out

of LensCrafters’ retail “premises,” but the mall misconstrues Maryland Casualty as a premises

liability case when, in reality, liability was imposed there because the named insured employed the

injured party, and here, the named insured LensCrafters did not employ the injured party.

Maryland Casualty Co., 126 Ill. App. 3d at 155, 466 N.E.2d at 1094; see also Electric Insurance

Co. v. National Union Fire Insurance Co of Pittsburgh., 346 F. Supp. 2d 958, 966 (N.D. Ill

2004) (“In fact, every Illinois court that has found ‘but for’ causation in the additional insured

context has done so because the injured party was, like the injured party in Maryland Casualty,

the named insured’s employee”). Furthermore, Mark Swanson’s accident did not arise out of

covered “premises.” According to section 11.01 of the lease which the mall drafted, the insurance

policy procured by the tenant had to cover “the leased premises and operations of Tenant and any

subtenants of Tenant in, on, or about the leased premises.” The preamble and section 1.01 of the

lease define the “Leased Premises” as “Store Number 330, situated on the upper level of Building

‘D.” The letter agreement that was simultaneously executed with the lease stated the “ ‘leased

premises’ ” was “space *** in (emphasis added) the Shopping Mall to be known a WOODFIELD

MALL” and the lease extension drafted by the mall and executed in 1996 reiterated that the

demised premises were “for a retail business to be operated under the trade name

‘LENSCRAFTERS,’ covering premises identified as Store No. ‘D-330,’ in the regional retail

development commonly known as WOODFIELD MALL.” (Emphasis added.) It is undisputed

that Mark Swanson’s investigation started in the retail space leased to LensCrafters, but Swanson

specified that Mark Swanson was in “an interior corridor to the roof of the mall,” which was a

                                                  23
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common area of the shopping center not demised to LensCrafters, and no longer “in, on, or about

the leased premises,” attempting to repair the air conditioning equipment that cooled the store’s

eyewear lab when he slipped from an affixed ladder which was controlled and maintained by the

mall. The mall’s own lease indicates it was not contractually entitled to coverage under the

LensCrafters’ policy for the accident that occurred while Mark Swanson was away from the

leased premises conducting HVAC maintenance and repairs.

       Because Mark Swanson’s injuries did not arise out of LensCrafters’ work as an eyewear

retailer or arise out of LensCrafters’ leased premises on the third floor of the mall, the policy did

not encompass the unfortunate turn of events. Thus, even under the Illinois law the mall contends

is controlling, we do not find the policy language requires Liberty Mutual to defend the mall from

Swanson’s allegations.

       The mall’s third main argument is that the trial court took an overly narrow view of

Swanson’s allegations that the mall’s negligence caused Mark Swanson’s injuries and death and

should have determined Swanson might, possibly, amend her pleading in the future to claim

LensCrafters was primarily liable due to its own negligent acts or omissions and that the mall was

secondarily liable. The mall contends this scenario was not “pled directly or artfully” but,

nonetheless, it might be pled and, under Ohio law, allegations of this nature would trigger the

insurer’s duty to defend LensCrafters as a primary, named insured and then the mall as an

additional insured. We find this argument has been waived due to the mall’s failure to cite and

analyze any supporting facts in the record. McGovern v. Kaneshiro, 337 Ill. App. 3d 24, 38, 785

N.E.2d 108, 121 (2003) (appellant cannot omit factual foundation and expect an appellate court

                                                  24
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to sift through the record to find support for a determination favorable to appellant’s position).

This section of the mall’s brief lacks any record citation whatsoever. Furthermore, it is

undisputed that the mall defendants are the only parties named in Swanson’s pleading and all the

allegations concern the mall’s own, independent tortious conduct regarding a common area of the

shopping center solely within the mall’s control. More specifically, Swanson’s common

allegations state in relevant part:

                        “3. On 8-24-04, a fixed ladder/stairwell existed at Woodfield Mall near the

                LensCrafters Store that led from an interior corridor to the roof of the mall.

                        4. Defendant [mall] did at all times own and control the ladder/stairway.

                        5. The ladder/stairway provided access to the roof for contractors and

                other authorized users.

                        6. Access from the ladder/stairway to the roof was through a hatch located

                on the roof.

                        7. The ladder/stairway contained handrails on both sides and flat steps

                with a top step approximately 28 inches below the top of the roof hatch.

                        8. Access to the ladder/stairway could only be accomplished by stepping

                over the side of the raised roof hatch and 28 inches down to the first rung/step.

                        9. Mark Swanson was at all times employed by Carrier Corporation as a

                heating and air conditioning technician.

                        10. Defendant [mall] or its agents did at all times contract with Carrier

                Corporation to provide repair and maintenance services for the heating and air

                                                 25
1-09-1905

            conditioning equipment at the mall.

                    11. On 8-24-04, Mark Swanson was dispatched to Woodfield Mall by

            Carrier Corporation to provide heating/air conditioning services.

                    12. At the above time and place, Mark Swanson was attempting to

            descend the subject ladder/stairway from the roof when he fell to the concrete

            floor of the corrider.

                    13. Defendant [mall] had a duty at all times material herein to provide a

            ladder/stairway that was safe and which provided safe access to and from the roof.

                    14. Defendant [mall] was negligent b[efore] and at the time of the

            occurrence in one or more of the following respects.

                           a. Failed to provide a ladder/stairway in which the vertical spacing

                    of the rungs/steps was uniformly 12 inches between the rung/step centers

                    throughout the length of the climb.

                           b. Provided and maintained a ladder/stairway in which the top

                    rung/step was approximately 28 inches below the top of the roof hatch.

                           c. Failed to provide a ladder/stairway that could be safely mounted

                    and descended from the roof.

                           d. Failed to provide a ladder/stairway that clearly communicated

                    how it should be used by people going to and from the roof.

                           e. Installed a raised roof hatch at the top of the ladder/stairway that

                    required a user to step over the side of the hatch and 28 inches down to the

                                             26
1-09-1905

                       first rung/step of the ladder/stairway.

                              f. Failed to provide a safe means of descent from the roof.

                              g. Failed to install a new ladder/stairway or roof hatch.

                              h. Failed to repair/modify the ladder/stairway or roof hatch.

                              i. Failed to warn of the hazards associated with the use of the

                       ladder/stairway.

                       15. As a direct and proximate result of the foregoing wrongful acts, Mark

                Swanson fell from the ladder/stairway on 8-24-04 and died on 9-3-04.”

None of the allegations suggest in any way that the mall could be held vicariously liable for

tortious acts or omissions of its tenant LensCrafters. None of the allegations create doubt or

uncertainty as to whether a theory of recovery within the policy’s coverage has been pled.

Furthermore, the mall states the trial court had authority to consider “matters outside the

pleadings,” but it does not explain what “matters outside the pleadings” could have and should

have been considered. It appears the mall’s entire argument regarding the potential for secondary

liability is speculation. Accordingly, if this argument had not been waived by failure to provide

record citation and adequate analysis, we would have rejected it on the merits.

       Next, the mall recasts its secondary liability argument under Illinois law. We remain

unpersuaded because none of the allegations suggest the potential for liability on the part of

LensCrafters.

       This brings us to the mall’s fourth main argument, which is that its lease with LensCrafters

entitles it to be a primary insured on LensCrafters’ policy. This argument is based on section

                                                 27
1-09-1905

11.01 of the lease which requires LensCrafters to procure and keep in effect a minimum amount

of comprehensive general liability insurance policy. The mall omits the additional language in

section 11.01 indicating this insurance coverage shall be “with respect to the leased premises and

the operations of Tenant and any subtenants of Tenants in, on or about the leased premises.” It

chooses to quote a clause indicating “the coverage evidenced thereby shall be primary and non-

contributing with respect to any policies carried by the Landlord, and that any coverage carried by

the Landlord shall be excess insurance.” The mall also disregards the General Amendatory

Endorsement discussed above indicating the additional insured coverage is limited to “ ‘personal

injury’ or ‘property damage’ arising out of (a) ‘your work’ or (b) premises or other property

owned by or rented to you.” Based on its selective editing, the mall concludes it is contractually

entitled to primary coverage for the loss alleged in Swanson’s action, meaning that the insurer is

obliged to provide a defense and any other policies affording coverage to the mall are only excess

policies.

        The mall supports its contention with a single Illinois case, rather than the Ohio authority

that governs interpretation of the policy provisions, which is reason for us to conclude the

argument is waived. Village of Riverwoods, 276 Ill. App. 3d at 729, 658 N.E.2d at 1268.

Nonetheless, we chose to address it. We cannot limit our consideration to a sentence clause

which appears to favor the mall. Under Ohio law, we consider the insurance contract as whole

and give effect to the apparent intent of the parties. Currier v. Penn-Ohio Logistics, 2010-Ohio-

198, ¶56, 931 N.E.2d 129, 138. The mall’s argument fails when section 11.01 of the lease is read

in conjunction with the General Amendatory Endorsement discussed above which limits the mall’s

                                                 28
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coverage as an additional insured to liability arising out of LensCrafters’ “work” and “operations

or premises” at the shopping mall. Furthermore, the argument fails under the Illinois law the mall

relies upon. The mall contends Bieda is analogous, but in that case, a tenant was contractually

required to obtain additional insured coverage for its landlord with respect to “the demised

premises” and the underlying plaintiff was injured while making a delivery to the demised

premises. Bieda v. Carson International, 278 Ill. App. 3d 510, 511, 512 N.E.2d 102, 103

(1996). The issue addressed was whether the coverage was “primary” instead of contingent upon

the exhaustion of some other policy. Bieda, 278 Ill. App. 3d at 512, 512 N.E.2d at 104. We do

not reach the issue of whether there is primary or contingent coverage because a plain reading of

the unedited lease indicates there is no coverage for the landlord/mall with regard to this

particular loss.

        The mall’s final argument is based on the insurer’s letter dated November 13, 2006, in

which the insurer referred to the mall as an “additional insured” under the policy and agreed to

provide a defense under a reservation of rights. The mall argues these statements resulted in

waiver of any policy defenses. The letter consisted of three sections, the first stating:

                          “We have received your tender of the defense of the Woodfield Mall in

                   [the legal action captioned ‘Estate of Swanson v. Woodfield Mall LLC’]. Based

                   on our review of the complaint, the contract between LensCrafters and the Mall

                   and the Commercial Generality Liability policy issued to LensCrafters, we have

                   determined that the allegations of the complaint create a potential for coverage for

                   the Mall under the policy. As a result, we will provide a defense, subject to the

                                                    29
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               position outlined in this letter.”

The second section was a summary of the Swanson complaint and the relevant portions of the

insurance policy. The third section was the insurer’s conclusion:

                       “The lease between the Mall and LensCrafters requires LensCrafters to

               provide additional insured status to the Mall. As a result, the Mall is an insured

               but only with respect to liability arising out of the premises leased to LensCrafters.

               We will only indemnify you for damages awarded for “bodily injury” for liability

               arising out of the premises leased to LensCrafters.

                       While we have attempted to address all of the coverage issues related to

               this claim, Liberty Mutual reserves all rights under applicable law and the policy.

               This letter should not be construed as a waiver or estoppel of any possible

               coverage defenses afforded by the policy or applicable law.”

       Under Ohio and Illinois law, waiver of an insurer’s rights occurs unilaterally and does not

require any prejudice to or detrimental reliance by the insured. State Farm Mutual Automobile

Insurance Co. v. Ingle, 2008-Ohio-6726, ¶32, 904 N.E.2d 934, 938-39; Western Casualty &

Surety Co. v. Brochu, 105 Ill. 2d 486, 498, 475 N.E.2d 872, 877 (1985). Waiver consists of the

insurer’s intentional relinquishment of a known right. Ingle, 2008-Ohio-6726, ¶32, 904 N.E.2d at

938; Brochu, 105 Ill. 2d at 499, 475 N.E.2d at 878. Waiver may be express or implied and arises

from an affirmative act, word, conduct or knowledge. Ingle, 2008-Ohio-6726, ¶32, 904 N.E.2d

at 938-39; Brochu, 105 Ill. 2d at 498, 475 N.E.2d at 877. Waiver cannot, however, expand

coverage beyond the express terms of the insurance policy. Hartory v. State Automobile Mutual

                                                    30
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Insurance Co., 50 Ohio App. 3d 1, 3, 552 N.E.2d 223, 225-226 (1988).

       The mall has waived its final contention on appeal by failing to cite Ohio authority.

Village of Riverwoods, 276 Ill. App. 3d at 729, 658 N.E.2d at 1268 (failure to cite supporting

authority results in waiver). Since it would belabor the point to address the argument under both

Ohio and Illinois law, we choose to limit our analysis to Illinois authority which is factually

similar. Brochu illustrates that an insurer may expressly reserve the right to deny coverage at a

later date. Brochu, 105 Ill. 2d 486, 475 N.E.2d 872. In that case, an insurance claims manager

accepted defense of a suit and stated that with respect to coverage there “doesn’t appear to be

any further question concerning coverage at this time.’ ” (Emphasis in original.) Brochu, 105 Ill.

2d at 499, 475 N.E.2d at 878. Despite this cautious phrasing, the client would subsequently

argue the claims manager had relinquished the right to deny coverage. Brochu, 105 Ill. 2d at 498,

475 N.E.2d at 878. Two weeks after the first letter was sent, the insurer’s attorney sent a letter

indicating the insurer was defending the suit without any admission of its liability under the policy;

that it was reserving its right to rely on coverage exclusions known as “(n)” and “(o),” which

concerned inadequacies in the insured’s own work or product; and that the insured had the right

to take over the management of the defense. Brochu, 105 Ill. 2d at 499, 475 N.E.2d at 878.

Even though there was a lag in the insurer’s specific invocation of policy exclusions “(n)” and

“(o),” the court determined it had not intentionally relinquished its right to rely on those

exclusions. Brochu, 105 Ill. 2d at 499, 475 N.E.2d 878-79.

         We fail to see how the current insurer’s letter could be construed as waiver. This is a

clearer case than Brochu, because here, rather than two letters separated by two weeks, there was

                                                  31
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one letter in which the insurer spelled out the limits of its undertaking to defend the shopping mall

and made clear it was not relinquishing its right to deny coverage at a later date. The insurer’s

acknowledgment that the shopping mall qualified as an “additional insured” under its tenant’s

policy was not an indication there was insurance coverage for the Swanson action. The insurer

went on to state there was only “a potential of coverage for the Mall under the policy” and that it

would defend the Swanson action “subject to the position outlined in this letter.” It then

specifically invoked the policy’s limitation on coverage to “premises or other property owned by

or rented to [LensCrafters]” and the policy’s limitation on indemnification to “damages awarded

for ‘bodily injury’ for liability arising out of the premises leased to LensCrafters.” Furthermore,

the insurer concluded by expressly “reserv[ing] all rights under applicable law and the policy” and

cautioning the mall that it should not construe the letter as “waiver or estoppel of any possible

coverage defenses afforded by the policy or applicable law.” Four months later, the insurer filed

the instant action seeking a judicial declaration of noncoverage due to the “premises” language

quoted in the letter. Under these facts, we do not see how the insurer intentionally relinquished

its right to deny coverage based on the “premises” policy language.

       The circumstances differ from those described in cases cited by the mall, including Mathis,

in which the insurer denied coverage on certain grounds (misrepresentation and arson) but then

later tried to avoid coverage on other grounds (the timing of the insured’s proof-of-loss form).

Mathis v. Lumbermen’s Mutual Casualty Insurance Co., 354 Ill. App. 3d 854, 822 N.E.2d 543

(2004). We fail to see the relevance of Heneghan, in which the insurer acquiesced to the

insured’s decision to delay making a claim until a trial determined who was driving the car that

                                                 32
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collided with the insured’s car and subsequently tried to deny the delayed claim as untimely.

Heneghan v. State Security Insurance Co., 195 Ill. App. 3d 447, 552 N.E.2d 406 (1990). We

also reject the mall’s reliance on Gray, in which the insurer announced that its investigation was

complete and showed there was coverage, but, nine months later, informed the claimant that the

investigation and coverage determination were still underway, and shortly after that, concluded

the investigation and denied coverage. State Farm Mutual Automobile Insurance Co. v. Gray,

211 Ill. App. 3d 617, 619, 570 N.E.2d 472, 474 (1991). The insurer could not explain why the

first letter had been sent. Gray, 211 Ill. App. 3d at 620, 570 N.E.2d at 474. In the court’s

opinion, the first letter would have led the claimants to believe coverage was not in dispute and

that the insurer intended to address questions of damages and liability as called for by the

insurance contract. Gray, 211 Ill. App. 3d at 621, 570 N.E.2d at 475. In contrast to Mathis,

Henegahan, and Gray, the present insurer consistently asserted the “premises” language and its

right to coverage defenses.

       In its reply brief, the mall cites Gray, 211 Ill. App. 3d 617, 570 N.E.2d 472, for the

additional proposition that the insurer waived its policy defenses by not filing this declaratory

judgment suit sooner. In a motion taken with the case, the insurer argues we should strike this

argument and others because they are improperly raised for the first time in the reply. 210 Ill. 2d

R. 341(h)(7) (the appellant's opening brief must contain an argument section and “[p]oints not

argued are waived and shall not be raised in the reply brief, in oral argument, or on petition for

rehearing.”); Sylvester v. Chicago Park District, 179 Ill. 2d 500, 507, 689 N.E.2d 1119, 1123

(1997) (citing Rule 341(e)(7), now Rule 341(h)(7), for the proposition that arguments introduced

                                                 33
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in a reply brief are waived). Any issue raised for the first time in the reply brief has been

disregarded. All other aspects of the motion to strike are denied.

        Having considered and rejected all the mall’s arguments, we affirm the judgment of the

trial court in favor of the insurer.

        Affirmed; motion taken with case denied.

        CAHILL and R. GORDON, JJ., concur.

                                                  34