Court Opinion

ID: 3135603
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:39:35.383989+00
Date Added: 2024-06-11T11:54:11.474068
License: Public Domain

Docket No. 108799.

                              IN THE
                      SUPREME COURT
                                 OF
                THE STATE OF ILLINOIS

PEKIN INSURANCE COMPANY et al. (Pekin Insurance Company,
Appellant), v. JACK O.WILSON et al. (Jack O. Wilson, Appellee).

                    Opinion filed May 20, 2010.

   JUSTICE KARMEIER delivered the judgment of the court, with
opinion.
   Chief Justice Fitzgerald and Justices Freeman, Thomas, Kilbride,
Garman, and Burke concurred in the judgment and opinion.

                             OPINION

    In this insurance coverage dispute, we are asked to determine
whether the duty to defend the insured may be triggered by allegations
of self-defense in the insured’s counterclaim filed in response to an
underlying lawsuit alleging the insured’s intentional acts, where the
policy contains both an exclusion for intentional acts and a self-
defense exception to that exclusion. For the reasons which follow, we
hold that the duty to defend is triggered.

                          BACKGROUND
    This case has its origins in a lawsuit filed in Jefferson County
circuit court by Terry Johnson against the appellee herein, Jack O.
Wilson, alleging causes of action for assault, battery, and intentional
infliction of emotional distress stemming from an incident in October
2002 and one in January 2004. Wilson tendered the defense of the
Johnson suit (or underlying lawsuit) to the appellant herein, Pekin
Insurance Company (Pekin), which had issued a commercial general
liability policy to Wilson for the period September 22, 2002, through
September 23, 2003. Wilson also tendered the defense of the Johnson
suit to Farmers Automobile Insurance Association (Farmers), which
had issued a homeowner’s policy to Wilson covering the period of
November 3, 2003, through May 3, 2004. On April 25, 2005, Pekin
and Farmers jointly filed a complaint for a declaratory judgment, each
asking the court for a determination that it did not owe Wilson a duty
to defend the underlying lawsuit.1
     Johnson filed an amended complaint in the underlying lawsuit on
August 31, 2005, adding a count alleging negligence against Wilson.
In the amended complaint, Johnson alleged that on October 31, 2002,
an incident occurred at D&J Tarp Service, where, Johnson alleged, he
had been “assisting Debi Wilson at her place of business” when Wilson
arrived and began screaming expletives at him and “brandished” a
steel pipe. Johnson alleged that Wilson struck him with the pipe in the
shoulder and lacerated Johnson’s right hand with a knife. Johnson
alleged that, in order to protect himself, he subdued Wilson and
restrained him, as Wilson continued his attempt to physically harm
Johnson. After Johnson released Wilson, Wilson continued to scream
expletives and threatened to go home to get a gun to shoot Johnson
and Debi Wilson. It was further alleged that more than one year later,
in January 2004, Wilson approached Johnson at a Wal-Mart store and
showed him “what appeared to be the handle of a pistol.” Johnson
alleged that Wilson said he could “end it right now.”
     In the negligence count, Johnson realleged all the factual
assertions from the intentional tort counts (assault, battery, and
intentional infliction of emotional distress). Johnson then alleged that
Wilson had breached his duty of ordinary care by failing to
“adequately use tools of his employment in a safe manner[,] causing

  1
   Farmers secured a declaratory judgment that it owed no duty to defend
and the appellate court agreed. Farmers is therefore not a party to this
appeal.

                                  -2-
physical harm,” that Wilson had failed to “properly maintain tools and
knives in a protective manner,” and that he had failed to “use tools for
their intended purpose[,] causing physical harm.” Finally, Johnson
alleged that Wilson’s negligence was the proximate cause of his
injuries.
     Pekin’s policy covered Wilson as the “insured,” and it described
his business as a “private warehouse.” In the coverages section, Pekin
agreed to cover bodily injury and property damage liability as follows:
             “We will pay those sums that the insured becomes legally
         obligated to pay as damages because of ‘bodily injury’ or
         ‘property damage’ to which this insurance applies. We will
         have the right and duty to defend any ‘suit’ seeking those
         damages. We may at our discretion investigate any
         ‘occurrence’ and settle any claim or ‘suit’ that may result.”
     Pekin listed the following exclusion to its bodily injury coverage:
“ ‘Bodily injury’ or ‘property damage’ expected or intended from the
standpoint of the insured” (the intentional-act exclusion). To the
intentional-act exclusion, Pekin provided the following exception:
“This exclusion does not apply to ‘bodily injury’ resulting from the use
of reasonable force to protect persons or property” (the self-defense
exception). In an endorsement to the policy, Pekin limited its coverage
for bodily injury to occurrences “arising out of *** [t]he ownership,
maintenance[,] or use of the premises shown in the Schedule and
operations necessary or incidental to those premises.”
     On October 5, 2005, Pekin filed an amended complaint for a
declaratory judgment, again seeking a finding that it did not owe
Wilson a duty to defend him in the underlying lawsuit. The amended
complaint for a declaratory judgment was in response to Johnson’s
amended complaint in the underlying lawsuit, in which he added the
negligence count against Wilson. On October 11, 2005, Wilson filed
an answer to the amended complaint in the underlying lawsuit. As a
part of his answer, Wilson filed a counterclaim against Johnson,
alleging that, during the incident at D&J Tarp Service, Johnson was
the aggressor and Wilson was defending himself. The counterclaim
alleged that Johnson was guilty of assault, battery, and intentional
infliction of emotional distress. In addition to the allegations that
Johnson had been the aggressor in the altercation at D&J Tarp
Service, Wilson also alleged in each of the three counts:

                                  -3-
             “6. Because of the physical size difference of *** Wilson
         and *** Johnson, [Wilson] picked up a piece of thin wall
         conduit used in the tarp service and, without moving in any
         threatening manner but merely possessing the pipe as to
         defend himself from *** Johnson, renewed his demand that
         *** Johnson leave the premises.
             7. Thereupon, Johnson, with knowledge and intent,
         without provocation and without authority to remain upon the
         premises, came forward, grabbed Wilson, took the pipe away
         from him, and smashed his head and face into the wall.”
     On March 3, 2006, Wilson filed an answer to the amended
complaint for a declaratory judgment, denying that Pekin had no duty
to defend him in the underlying lawsuit. Wilson contended that the
allegations of the underlying lawsuit were covered by the Pekin policy,
citing the amended complaint in the underlying lawsuit which alleged
that “the occurrence took place during normal business hours at the
premises where [Wilson’s] business is located and to which the Pekin
policy extends coverage.” Wilson also filed a counterclaim against
Pekin, alleging counts of breach of contract and vexatious and
unreasonable delay in violation of section 155 of the Illinois Insurance
Code (215 ILCS 5/155 (West 2006)), given that, inter alia, “the
Pekin policy gives rise to a duty on the part of Pekin to defend Wilson
against covered claims.”
     On September 18, 2006, Pekin filed a motion for judgment on the
pleadings pursuant to section 2–615(e) of the Code of Civil Procedure
(735 ILCS 5/2–615(e) (West 2006)). Pekin argued, inter alia, that the
negligence count of Johnson’s amended complaint did not bring the
underlying lawsuit within the coverage of its policy because Johnson
had merely couched allegations of intentional conduct by Wilson in
negligence terms. Pekin thus asserted that it was entitled to a
judgment on the pleadings because there were no factual issues and it
was clear it did not owe Wilson a duty to defend him in the underlying
lawsuit. It was similarly asserted that there was no coverage for the
incident that Johnson alleged to have occurred at the Wal-Mart store. 2

  2
   While the alleged Wal-Mart incident occurred during the coverage period
of only the Farmer’s policy, if Pekin has a duty to defend as to at least one

                                    -4-
     On October 10, 2006, Wilson filed a response to the motion for a
judgment on the pleadings, arguing, inter alia, that Pekin had taken
a statement from him and was aware that he denied any intention to
harm Johnson. Wilson argued that any harm that Johnson suffered
“would have been by accident.” He argued that the court should
conclude that Johnson’s allegations of negligence were sufficient to
raise a duty to defend. Wilson further argued that Pekin was not
entitled to a judgment on the pleadings so long as the possibility
existed that the jury would find that his conduct was either negligent
or that “no untoward conduct”occurred by Wilson toward Johnson,
and that Pekin had denied coverage despite language in its policy
stating: “we will pay the sums that the insured becomes legally
obligated to pay as damages because of ‘bodily injury’ to which this
insurance applies.”
     On March 29, 2007, the trial court entered an order declaring that
Pekin had no duty to defend Wilson in the underlying lawsuit because
its policy did not cover the claims asserted in that lawsuit. On April
30, 2007, Wilson filed a motion to reconsider, arguing, in pertinent
part, that the order was premature because the jury in the underlying
lawsuit could determine Wilson’s conduct “to have been negligent,”
or that “there was a duty to defend” Wilson. After hearing the parties’
arguments, the court entered an order denying Wilson’s motion to
reconsider and dismissing his counterclaim in the declaratory judgment
action. The underlying lawsuit and Wilson’s counterclaim against
Johnson in that lawsuit remain pending.
     Wilson filed a timely notice of appeal. The appellate court first
found that the facts as alleged in the underlying complaint were
inconsistent with allegations of negligence. Thus, no genuine issue of
material fact remained as to the count that Johnson labeled as
negligence.3 391 Ill. App. 3d 505, 511. However, the remaining

count of the lawsuit, it has a duty to defend in all counts of that lawsuit. See
Maryland Casualty Co. v. Peppers, 64 Ill. 2d 187, 194 (1976); Bedoya v.
Illinois Founders Insurance Co., 293 Ill. App. 3d 668, 674-75 (1997).
 3
  As there is no argument by Wilson that any issue of genuine material fact
remains as to Pekin’s duty to defend the negligence count of the underlying
lawsuit, we will not address the matter further.

                                      -5-
counts for assault, battery, and intentional infliction of emotional
distress each allege intentional conduct that Wilson should have
expected or intended, thus bringing these allegations under the
intentional-act exclusion. As to these counts, the appellate court
reversed the judgment for Pekin, holding that, in addition to relying
upon the allegations of Johnson’s complaint in the underlying lawsuit
to ascertain Pekin’s duty to defend, the court could consider whether
the allegations which Wilson raised in his counterclaim against
Johnson triggered the self-defense exception in the policy. 391 Ill.
App. 3d at 513. We granted Pekin’s petition for leave to appeal. 210
Ill. 2d R. 315(a).

                             ANALYSIS
    Pekin argues that the appellate court erred in reversing the trial
court’s grant of judgment on the pleadings in Pekin’s favor, because
the determination of the duty to defend must be based solely upon the
allegations of the underlying complaint. According to Pekin, despite
the fact that its policy contains a self-defense exception to the
coverage exclusion for intentional acts, the question of Pekin’s duty
to defend cannot, as the appellate court found, include consideration
of the insured’s own pleadings raising this exception. We review the
grant of judgment on the pleadings de novo. Gillen v. State Farm
Mutual Insurance Co., 215 Ill. 2d 381, 385 (2005). Additionally, the
construction of the provisions of an insurance policy is a question of
law for which our review is de novo. Central Illinois Light Co. v.
Home Insurance Co., 213 Ill. 2d 141, 153 (2004); American States
Insurance Co. v. Koloms, 177 Ill. 2d 473, 479-80 (1997).
    A motion for judgment on the pleadings is, like a motion for
summary judgment, limited to the pleadings. Employers Insurance of
Wausau v. Ehlco Liquidating Trust, 186 Ill. 2d 127, 138 (1999).
Judgment on the pleadings is properly granted if the pleadings disclose
no genuine issue of material fact and that the movant is entitled to
judgment as a matter of law. M.A.K. v. Rush-Presbyterian-St. Luke’s
Medical Center, 198 Ill. 2d 249, 255 (2001); Employers Insurance of
Wausau, 186 Ill. 2d at 138. “For purposes of resolving the motion, the
court must consider as admitted all well-pleaded facts set forth in the
pleadings of the nonmoving party, and the fair inferences drawn
therefrom.” Employers Insurance of Wausau, 186 Ill. 2d at 138. In a

                                 -6-
declaratory judgment action such as that presented here, where the
issue is whether the insurer has a duty to defend, a court ordinarily
looks first to the allegations in the underlying complaint and compares
those allegations to the relevant provisions of the insurance policy.
See Koloms, 177 Ill. 2d at 479; Outboard Marine Corp. v. Liberty
Mutual Insurance Co., 154 Ill. 2d 90, 107-08 (1992). If the facts
alleged in the underlying complaint fall within, or potentially within,
the policy’s coverage, the insurer’s duty to defend arises. Koloms, 177
Ill. 2d at 479.
     As this court further stated in Koloms:
         “A court’s primary objective in construing the language of the
         policy is to ascertain and give effect to the intentions of the
         parties as expressed in their agreement. [Citation.] If the terms
         of the policy are clear and unambiguous, they must be given
         their plain and ordinary meaning. [Citation.] Conversely, if the
         terms of the policy are susceptible to more than one meaning,
         they are considered ambiguous and will be construed strictly
         against the insurer who drafted the policy. [Citation.] In
         addition, provisions that limit or exclude coverage will be
         interpreted liberally in favor of the insured and against the
         insurer. [Citation.] A court must construe the policy as a
         whole and take into account the type of insurance purchased,
         the nature of the risks involved, and the overall purpose of the
         contract. [Citation.]” Koloms, 177 Ill. 2d at 479.
Furthermore, the insurer’s duty to defend its insured is broader than
its duty to indemnify. Outboard Marine Corp., 154 Ill. 2d at 125.
     At oral argument, Pekin relied mainly on this court’s decision in
Zurich Insurance Co. v. Raymark Industries, Inc., 118 Ill. 2d 23
(1987), to support its contention that the appellate court erred in
allowing consideration of Wilson’s counterclaim in addition to the
allegations contained in the underlying complaint. Pekin contends that
Zurich Insurance Co., 118 Ill. 2d at 52, stands for the rule that a trial
court must look solely to the underlying complaint and the applicable
policy provisions to determine whether there is a duty to defend. Our
examination of Zurich Insurance Co. shows that such a limited
interpretation was not intended.
     In Zurich Insurance Co., this court examined a declaratory

                                   -7-
judgment action involving the construction of various comprehensive
general liability insurance polices issued to defendant Raymark
Industries, Inc. (Raymark). In 1978, Zurich Insurance Company
(Zurich), one of Raymark’s primary insurers, filed an action in the
circuit court against Raymark and two of Raymark’s other primary
insurers, seeking a declaration of its obligations and the obligations of
the other insurers to defend and indemnify Raymark in thousands of
underlying lawsuits filed by individuals alleging personal injuries or
wrongful death resulting from exposure to asbestos-containing
products manufactured by Raymark. Of the several issues raised in
this court, the one relevant to the case at bar was set forth as follows:
“Do the terms of the policies issued to Raymark before September 26,
1967 *** require the primary insurers to defend new actions and to
continue to defend actions pending against Raymark after the limits of
liability under those policies have been exhausted by the payment of
judgments or settlements?” Zurich Insurance Co., 118 Ill. 2d at 31.
This court concluded that the policy language limited the duty to
defend to the amount of indemnity coverage afforded by the policy as
well as to the type of coverage afforded. Zurich Insurance Co., 118
Ill. 2d at 51.
     Although the insurers had undertaken to pay defense costs and
various supplemental expenses “ ‘in addition to the applicable limit of
liability’ ” of their policies, this court found that, nevertheless, “we do
not construe this provision, as Raymark does, to create an
independent and continuing obligation to pay the cost of defending
claims against Raymark ad infinitum.” Zurich Insurance Co., 118 Ill.
2d at 51. Rather, this provision was included so that defense costs and
other enumerated expenses the insurer agreed to pay would not
reduce the limits of liability available for payment of judgments or
settlements. Zurich Insurance Co., 118 Ill. 2d at 51-52.
     This court further reasoned:
              “Raymark seeks to avoid this [court’s] conclusion by
         arguing that the duty to defend is an independent undertaking
         of the insurer that exists in addition to the duty to indemnify.
         Raymark’s argument is premised on this court’s statement that
         ‘an insurer’s duty to defend and its duty to indemnify are
         separate and distinct and *** the former duty is broader than
         the latter.’ (Conway v. Country Casualty Insurance Co.

                                   -8-
        (1982), 92 Ill. 2d 388, 394.) The duty to indemnify arises only
        when the insured becomes legally obligated to pay damages
        in the underlying action that gives rise to a claim under the
        policy. The duty to defend an action brought against the
        insured, on the other hand, is determined solely by reference
        to the allegations of the complaint. If the complaint alleges
        facts which bring the claim within the potential indemnity
        coverage of the policy, the insurer is obligated to defend the
        action. (Thornton v. Paul (1978), 74 Ill. 2d 132, 144;
        Maryland Casualty Co. v. Peppers (1976), 64 Ill. 2d 187,
        193-94.)” (Emphasis added.) Zurich Insurance Co., 118 Ill.
2d at 52.
     We believe that the highlighted passage is simply an explanation
of the differences between the scope of the duty to indemnify and the
duty to defend; the question before us, whether other pleadings in the
underlying action may be considered in determining the duty to
defend, was not before this court in Zurich Insurance Co. Further, the
cases cited by this court in Zurich Insurance Co., 118 Ill. 2d at 52, for
the proposition that the “duty to defend an action brought against the
insured *** is determined solely by reference to the allegations of the
complaint,” do not support Pekin’s interpretation. Rather, in
Maryland Casualty Co., 64 Ill. 2d at 193, this court stated: “In
determining whether the insurer owes a duty to the insured to defend
an action brought against him, it is the general rule that the
allegations of the complaint determine the duty.” (Emphasis added.)
Thornton merely paraphrased this statement from Maryland Casualty
Co., declaring: “As a general rule, the duty of an insured to defend an
action brought against the insured is to be determined solely from the
allegations of the complaint.” (Emphasis added.) Thornton v. Paul, 74
Ill. 2d 132, 144 (1978), overruled on other grounds, American
Family Mutual Insurance Co. v. Savickas, 193 Ill. 2d 378, 387
(2000).
     Thus, we disagree with Pekin that this court in Zurich Insurance
Co. intended to limit the source of an insurer’s duty to defend “solely”
to the content of the underlying complaint in all cases. Additionally,
we note that appellate court cases cited by Pekin which found that a
third-party complaint may not be examined by a court in determining
a duty to defend also qualified that holding. See National Union Fire

                                  -9-
Insurance Co. of Pittsburgh v. R. Olson Construction Contractors,
Inc., 329 Ill. App. 3d 228, 238 (2002) (court declined to follow
approach taken by other appellate court cases suggesting a trial court
should look to a third-party complaint to determine the potential duty
to defend, “absent some unusual or compelling circumstances, which
are not present here”); accord L.J. Dodd Construction, Inc. v.
Federated Mutual Insurance Co., 365 Ill. App. 3d 260, 262 (2006).
     In concluding that a circuit court may, under certain
circumstances, look beyond the underlying complaint in order to
determine an insurer’s duty to defend, we find it useful, as did the
appellate court herein, to examine two cases: American Economy
Insurance Co. v. Holabird & Root, 382 Ill. App. 3d 1017 (2008), and
Fidelity & Casualty Co. of New York v. Envirodyne Engineers, Inc.,
122 Ill. App. 3d 301 (1983). In Holabird & Root, Cogtella, the
plaintiff in the underlying case, sued, inter alios, Holabird & Root
(H&R) and DePaul University (DePaul), alleging that she suffered
bodily injury due to her exposure to the fluorescent lighting selected
and installed in a building on the DePaul campus. H&R tendered its
defense of Cogtella’s complaint to plaintiff American Economy
Insurance Company (American Economy) because American
Economy was the insurer of Metrick Electric Company (Metrick), the
electrical subcontractor that H&R hired to install the lighting in the
building and because H&R was a named additional insured on
Metrick’s insurance policy. American Economy denied coverage and
filed a declaratory judgment action as to its duty to defend in the
Cogtella litigation. The trial court, in considering cross-motions for
summary judgment, held that American Economy had an obligation to
defend H&R in the Cogtella litigation.
     American Economy appealed, arguing that the trial court erred in
finding that it had a duty to defend H&R because the complaint filed
by Cogtella did not allege any negligence by Metrick and because the
trial court improperly considered a third-party complaint filed by
DePaul to find such a duty. The appellate court affirmed, concluding:
“If we consider both the Cogtella complaint and DePaul’s third-party
complaint along with the relevant language of the American Economy
policy, we find the facts raise the potential for coverage ***.”
Holabird & Root, 382 Ill. App. 3d at 1032. In reaching this holding,
the Holabird & Root court initially noted that the duty to defend does

                                -10-
not require that the underlying complaint allege or use language
affirmatively bringing the claims within the scope of the insurer’s
policy, because ‘ “ ‘[t]he question of coverage should not hinge on the
draftsmanship skills or whims of the plaintiff in the underlying
action.’ ” [Citation.]’ Holabird & Root, 382 Ill. App. 3d at 1022.
     Based on general precedent governing insurance coverage, as well
as its examination of “a long line of Illinois cases” involving summary
judgment proceedings in declaratory judgment actions, the Holabird
& Root court reasoned:
              “[C]onsideration of a third-party complaint in determining
         a duty to defend is in line with the general rule that a trial
         court may consider evidence beyond the underlying complaint
         if in doing so the trial court does not determine an issue
         critical to the underlying action [citation].[4] The trial court
         should be able to consider all the relevant facts contained in
         the pleadings, including a third-party complaint, to determine
         whether there is a duty to defend. After all, the trial court
         ‘ “need not wear judicial blinders” and may look beyond the
         complaint at other evidence appropriate to a motion for
         summary judgment.’ [Citations.]” (Emphasis added.) Holabird
         & Root, 382 Ill. App. 3d at 1024, 1031-32.
     The appellate court herein also relied upon Fidelity & Casualty
Co. of New York v. Envirodyne Engineers, Inc., 122 Ill. App. 3d 301,
304-05 (1983), in which the court affirmed the trial court’s entry of
a declaratory judgment in favor of an insurance company, holding that
the trial court could look beyond the underlying complaint in
determining the duty to defend. The court in Envirodyne Engineers,
Inc. stated the rationale for its holding as follows:
              “[W]e find no support for Envirodyne’s contention that
         the court may not look beyond the underlying complaint even
         in a declaratory proceeding where the duty to defend is at

  4
     The court noted that its consideration of the third-party complaint that
alleged Metrick installed the lights did not determine an issue crucial to the
Cogtella lawsuit or the ultimate finding of negligence. Holabird & Root, 382
Ill. App. 3d at 1032.

                                    -11-
        issue. It is certainly true that the duty to defend flows in the
        first instance from the allegations in the underlying complaint;
        this is the concern at the initial stage of the proceedings when
        an insurance company encounters the primary decision of
        whether to defend its insured. However, if an insurer opts to
        file a declaratory proceeding, we believe that it may properly
        challenge the existence of such a duty by offering evidence to
        prove that the insured’s actions fell within the limitations of
        one of the policy’s exclusions. [Citations.] The only time such
        evidence should not be permitted is when it tends to determine
        an issue crucial to the determination of the underlying lawsuit
        [citations] ***. If a crucial issue will not be determined, we
        see no reason why the party seeking a declaration of rights
        should not have the prerogative to present evidence that is
        accorded generally to a party during a motion for summary
        judgment in a declaratory proceeding. To require the trial
        court to look solely to the complaint in the underlying action
        to determine coverage would make the declaratory
        proceeding little more than a useless exercise possessing no
        attendant benefit and would greatly diminish a declaratory
        action’s purpose of settling and fixing the rights of the
        parties.” (Emphasis added.) Envirodyne Engineers, Inc., 122
Ill. App. 3d at 304-05.
    We believe that Holabird & Root and Envirodyne Engineers, Inc.
set forth the proper considerations for a circuit court to use in
deciding whether it is appropriate to examine evidence beyond that
contained in the underlying complaint in determining the duty to
defend. Having said this, we are conscious of the fact that both
Holabird & Root and Envirodyne Engineers, Inc. involved summary
judgment proceedings in which not only the contents of third-party
complaints in the underlying action but other evidence may be
considered in determining the insurer’s duty to defend. In the case at
bar, however, we are dealing with a grant of judgment on the
pleadings which, as earlier stated, is like a motion for summary
judgment, but limited to the pleadings, and is properly granted only if
the pleadings disclose no genuine issue of material fact and that the
movant is entitled to judgment as a matter of law. Employers
Insurance of Wausau, 186 Ill. 2d at 138. Thus, the question here is

                                 -12-
whether, after considering all the pleadings in the declaratory
judgment action, the court could find that no genuine issue of material
fact existed.
    In support of its motion for judgment on the pleadings, Pekin
submitted, as “attached hereto and incorporated herein,” its amended
complaint for declaratory judgment, Wilson’s answer and
counterclaim to Pekin’s amended complaint for declaratory judgment,
Pekin’s answer to Wilson’s counterclaim and, attached as exhibits to
Pekin’s amended complaint for declaratory judgment, the policy of
insurance issued by Pekin to Wilson and the complaint and amended
complaint filed by Johnson against Wilson in the underlying lawsuit.
Noticeably absent from Pekin’s motion for judgment on the pleadings
is Wilson’s answer and counterclaim in the underlying lawsuit,
assumedly because Pekin asserts that Wilson’s pleadings in that suit
cannot be considered.
    Pekin’s motion prays for entry of judgment on the pleadings
finding, inter alia, that its policy “do[es] not apply in respect to the
claims asserted by *** Johnson” in the underlying lawsuit, i.e.,
intentional torts, and that it has “no duty or obligation to defend ***
Wilson in [the underlying action].” Thus, Wilson’s counterclaim, as
part of the pleadings in the underlying lawsuit for which Pekin asked
the court’s determination of its duty to defend and provide coverage,
must be considered in deciding the motion for judgment on the
pleadings. Further, because the policy at issue included a self-defense
exception to its intentional-act exclusion which the underlying
complaint did not address, Wilson’s counterclaim must be examined
for the presence of allegations of fact sufficient to trigger that self-
defense exception. Otherwise, there is no way to determine if a
genuine issue of material fact exists as to whether the pleadings are
“substantially insufficient in law.” See 735 ILCS 5/2–615(b) (West
2006) (“If a pleading or a division thereof is objected to by a motion
to dismiss or for judgment or to strike out the pleading, because it is
substantially insufficient in law, the motion must specify wherein the
pleading or division thereof is insufficient”).
    Here, Wilson’s counterclaim in the underlying lawsuit alleged that
because of the physical size difference between Wilson and Johnson,
Wilson had armed himself with a piece of thin wall conduit and,
“without moving in any threatening manner but merely possessing the

                                 -13-
pipe as to defend himself from *** Johnson, renewed his demand that
Johnson leave the premises.” Thereafter, Johnson, without
provocation, “came forward, grabbed Wilson, took the pipe away
from him, and smashed his head and face into the wall.” Therefore, a
comparison of Wilson’s counterclaim to Johnson’s allegations in the
underlying complaint, i.e., that intentional conduct instigated by
Wilson caused injury to Johnson, shows that a genuine issue of
material fact exists regarding whether Pekin has a duty to defend
Wilson because it excepted self-defense from its intentional-act
exclusion. 391 Ill. App. 3d at 512-13.
    Additionally, Wilson’s memorandum in response to Pekin’s
motion for judgment on the pleadings in the declaratory judgment
action states, inter alia, that Wilson “has consistently denied that he
improperly harmed or intended to harm *** Johnson *** [and] asserts
that he picked up a piece of conduit *** in self defense of a larger
threatening person (Johnson).” Wilson also states that Pekin had taken
a statement from him which included a copy of the police report
received regarding acts alleged in the underlying lawsuit. This police
report, attached and incorporated by reference to Wilson’s
memorandum, indicates that while Johnson received a laceration to his
finger, no knife could be located and a deputy investigating the
incident believed the injury to Johnson’s hand “could have been made
by the end of the pipe.” Wilson therefore argued that where, in his
pleadings, he alleges he held a piece of conduit in self defense and was
then attacked, and denies any use of a knife and no knife was found,
“these factual inconsistencies support the denial of [Pekin’s] Motion.”
Thus, contrary to Pekin’s contention, Wilson’s counterclaim alleging
that Johnson grabbed the pipe Wilson wielded in self-defense, together
with the allegation in Johnson’s complaint that he subdued and
restrained Wilson, suggest that Johnson’s injury could have resulted
from Wilson’s act of self-defense. As previously stated, it was
incumbent upon the trial court, for purposes of resolving Pekin’s
motion for judgment on the pleadings, to consider as admitted all
well-pleaded facts set forth in the pleadings of the nonmoving party,
and the fair inferences drawn therefrom. See Employers Insurance of
Wausau, 186 Ill. 2d at 138.
    In addition to the necessity under section 2–615(e) for the trial
court to have examined the allegations in Wilson’s counterclaim, we

                                 -14-
find that here, unlike National Union Fire Insurance Co. and L.J.
Dodd Construction, Inc., there were “unusual or compelling
circumstances” requiring the trial court to go beyond the sole
allegations of the underlying complaint to determine the insured’s duty
to defend. As the appellate court herein stated:
             “It is clear to this court that if an insurance company has
         a right to present evidence beyond the complaint in the
         underlying lawsuit to show that it has no duty to defend, the
         insured has the same right to present evidence to show that
         there is a duty to defend. Where coverage depends upon
         whether an insured was acting in self-defense, it is crucial for
         the court to consider all the evidence presented before
         entering a declaratory judgment, since it is unlikely that the
         plaintiff in the underlying lawsuit will plead facts to show that
         the insured acted in self-defense. Typically, self-defense is
         raised as an affirmative defense. 735 ILCS 5/2–613 (West
         2006). In the underlying case presented here, as a part of his
         counterclaim against Johnson, Wilson alleged facts tending to
         show that he acted in self-defense. See 735 ILCS 5/2–608
         (West 2006).” (Emphases in original.) 391 Ill. App. 3d at 515.
    Pekin argues that sole consideration of the allegations of the
underlying complaint is proper even when the self-defense exception
to the intentional-act exclusion of its policy may be involved.
However, we agree with the appellate court below that it is “unlikely”
that the underlying complaint would set forth allegations supporting
a basis for defending Pekin’s insured under its self-defense exception.
There is no possible reason for Johnson, suing in tort for the
intentional conduct of Wilson, to allege that Wilson’s actions were
excused by, as the policy states: “ ‘bodily injury’ resulting from the
use of reasonable force to protect persons or property.” Thus, unless
Wilson, as the defendant-insured in the underlying lawsuit, is allowed
to plead facts alleging that the plaintiff’s injury occurred through
Wilson’s reasonable use of self-defense, there is no way for the self-
defense exclusion to be triggered, and the coverage is illusory.
    We cannot find that the parties intended the coverage of this
commercial general liability policy to be so construed. See Cincinnati
Insurance Co. v. Gateway Construction Co., 372 Ill. App. 3d 148,
152 (2007) (a reviewing court will not interpret an insurance policy in

                                  -15-
such a way that any of its terms are rendered meaningless or
superfluous). To the contrary, we find that, in light of the broad scope
of this type of policy, and the clear language of the self-defense
exception, the policy requires the defense of the insured where a
genuine issue of material fact exists as to whether the intentional acts
of the insured were committed in self-defense. See Outboard Marine
Corp., 154 Ill. 2d at 117 (in light of broad scope of comprehensive
general liability policy, and the popular meaning of “damages,” under
the facts of the case, the underlying actions were “suits seeking
damages” which triggered the insurer’s duty to defend its insured).
     Indeed, if Pekin actually desired to exclude coverage for all
lawsuits arising from the intentional conduct of its insured, it would
be illogical for it to have included the self-defense exception in the
policy to begin with. See Outboard Marine Corp., 154 Ill. 2d at 117.
     Having promised such coverage to Wilson, “Pekin cannot now
choose to ignore pleadings *** that indicate a duty to defend under
the self-defense exception.” 391 Ill. App. 3d at 515.
         “Pekin agreed that it would have ‘the right and duty to defend’
         any lawsuit seeking damages for bodily injury. It excluded
         coverage for bodily injury that is ‘expected or intended from
         the standpoint of the insured,’ but it provided that the
         intentional-act exclusion would ‘not apply to “bodily injury”
         resulting from the use of reasonable force to protect persons
         or property.’ Pekin drafted the policy, sold it to Wilson, and
         required him to pay the premiums for that coverage. When
         Wilson was sued for his intentional acts, he not only denied
         any intent to harm Johnson but also filed a pleading indicating
         that he was merely defending himself during the altercation.
         The pleadings raise issues of fact that trigger Pekin’s duty to
         defend Wilson under the self-defense exception. Pekin must
         now honor its agreement by defending Wilson in the
         underlying lawsuit.” 391 Ill. App. 3d at 513.
     We wish to emphasize that in addition to agreeing with the
appellate court herein that Pekin has a duty to defend Wilson, we also
agree with that court that this decision does not resolve any issue
critical to the underlying lawsuit. 391 Ill. App. 3d at 515; see also
Holabird & Root, 382 Ill. App. 3d at 1031. In contrast, if we were to
agree with Pekin that the trial court properly granted its motion for

                                 -16-
judgment on the pleadings based solely on the underlying complaint
and the intentional-act exclusion in the policy, we would, in essence,
be condoning the resolution of the issue at the heart of the underlying
lawsuit. Rather, where Pekin filed a motion for judgment on the
pleadings, it should only have been granted if the admissions contained
within the pleadings revealed no genuine issue of material fact such
that the movant would be entitled to judgment as a matter of law, and
the court should have considered all well-pleaded facts of the
nonmoving party, and the fair inferences to be drawn therefrom. Thus,
our holding is limited to reversing the trial court’s grant of judgment
on the pleadings to Pekin and allowing Wilson’s counterclaim against
Pekin in the declaratory judgment action to go forward. 5

                             CONCLUSION
     The trial court erred in failing to consider Wilson’s counterclaim
in the underlying lawsuit in deciding Pekin’s motion for judgment on
the pleadings in this declaratory judgment action. Therefore, we affirm
both the appellate court’s reversal of the circuit court’s grant of
judgment on the pleadings in favor of Pekin, and the appellate court’s
reversal of the dismissal of Wilson’s counterclaim against Pekin.

                                     Appellate court judgment affirmed.

   5
     We note that Pekin alternatively argues that because the underlying
lawsuit alleges only intentional acts, and its policy covers bodily injury
caused solely by accidental occurrences, the circuit court had an independent
basis for granting judgment on the pleadings. However, as we have found
that all relevant portions of the policy must be considered in determining the
insurer’s duty to defend, the self-defense exception to the intentional act
exclusion in Pekin’s policy is indeed relevant to the circuit court’s
determination of this declaratory judgment action.

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