Court Opinion

ID: 4636433
Source: CourtListenerOpinion
Date Created: 2020-11-24 22:36:12.530814+00
Date Added: 2024-06-11T07:58:32.450825
License: Public Domain

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                                      Appellate Court                          Date: 2020.06.22
                                                                               10:58:38 -05'00'

                 Lamorak Insurance Co. v. Kone, Inc., 2018 IL App (1st) 163398

Appellate Court           LAMORAK INSURANCE COMPANY, f/k/a Commercial Union
Caption                   Insurance Company, f/k/a Employers Commercial Union Insurance
                          Company, Plaintiff and Counterdefendant-Appellant, v. KONE, INC.,
                          and LIBERTY MUTUAL INSURANCE COMPANY, Defendants
                          and Counterplaintiffs-Appellees.

District & No.            First District, Second Division
                          Docket No. 1-16-3398

Filed                     May 15, 2018
Rehearing denied          November 1, 2018

Decision Under            Appeal from the Circuit Court of Cook County, No. 12-CH-42887; the
Review                    Hon. Rodolfo Garcia, Judge, presiding.

Judgment                  Affirmed.

Counsel on                Clyde & Co US LLP, of Chicago (Eileen King Bower, James J.
Appeal                    Sanders, and Meghan C. Dalton, of counsel), for appellant.

                          Molzahn, Reed, Rouse & Berger, LLC, of Chicago (Timothy J. Reed
                          and Jennifer R. Beegle, of counsel), and Ansa Assuncao LLP, of East
                          Brunswick, New Jersey (Steven F. Gooby and Kenneth Burden, of
                          counsel), for appellee Kone, Inc.
                              Schiff Hardin LLP, of Chicago (Everett J. Cygal, Catherine M.
                              Masters, and David Pi, of counsel), for other appellee.

     Panel                    PRESIDING JUSTICE NEVILLE delivered the judgment of the
                              court, with opinion.
                              Justices Pucinski and Mason concurred in the judgment and opinion.

                                              OPINION

¶1        When a former employee sued Kone, Inc. (Kone), for injuries suffered due to long-term
      exposure to asbestos, Kone notified all the insurance companies that sold policies to Kone
      during the employee’s long tenure. One of the insurers, Lamorak Insurance Company
      (Lamorak), argued that the policies it sold to Kone for the years 1977 to 1985 counted as excess
      insurance because Kone had agreed to a self-insured retention (SIR) instead of a deductible for
      those years. Kone filed a counterclaim that included a request for a judgment declaring that
      Lamorak’s policies provided primary coverage. The circuit court granted Kone’s motion for
      summary judgment on that part of its counterclaim. On Lamorak’s appeal from the partial
      summary judgment, we find that Lamorak’s policies bear the characteristics of primary
      insurance. Accordingly, we affirm the circuit court’s judgment.

¶2                                          BACKGROUND
¶3        In May 2012, John Nichol filed a complaint charging Kone with negligently exposing
      Nichol to asbestos and causing him to contract malignant pleural mesothelioma. Nichol alleged
      that his exposure to asbestos took place between the early 1960s and the late 1980s, when
      Nichol worked for Kone or Kone’s corporate predecessors. Kone provided notice of Nichol’s
      claim to insurers who sold liability policies to Kone and predecessor corporations covering the
      years from 1961 through 1988. One of the insurers, Lamorak, agreed to defend Kone, subject
      to a full reservation of rights.
¶4        In November 2012, Lamorak filed the complaint that initiated the case now before us.
      Lamorak, in its complaint, asked the court to enter a judgment allocating the liability to Nichol
      amongst all insurers who sold policies to Kone. Lamorak named Liberty Mutual Insurance
      Company (Liberty), Kone, and others as defendants. Lamorak admitted that its corporate
      predecessors sold insurance policies to Kone’s predecessors covering the period from June 30,
      1971, to June 30, 1985. (We will refer to Kone and its predecessors as Kone and to Lamorak
      and its predecessors as Lamorak.) Lamorak admitted that the policies for 1971 to 1977
      provided primary coverage, subject to a deductible. For the years 1977 to 1985, Lamorak sold
      Kone both umbrella policies and other policies, subject to SIRs. The parties agree that
      Lamorak’s umbrella policies provided excess coverage that Kone cannot reach until it exhausts
      underlying coverages. The parties disagree about Lamorak’s duties under the other policies,
      the policies at issue, which the umbrella policies listed as underlying coverage.

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¶5         Lamorak alleged, and Kone admitted, that several persons other than Nichol also filed
       complaints against Kone, seeking compensation for injury or damage due to asbestos exposure.
       Lamorak sought a judgment declaring that the policies at issue imposed on Lamorak no duty
       to defend because Kone had not exhausted all of its primary insurance for the years 1961
       through 1988. Lamorak contended that Liberty, as a primary insurer for part of that period, had
       prior responsibility for providing a defense and indemnity to Kone for Nichol’s claim.
¶6         Kone filed an answer to Lamorak’s complaint and a counterclaim. In count I of the
       counterclaim, Kone sought a judgment declaring that Lamorak had a duty to indemnify Kone
       for its liability to Nichol and the other persons who sued Kone. As one part of that relief, Kone
       prayed for a judgment declaring that the policies at issue count as primary insurance.
¶7         Liberty filed a motion for summary judgment on Kone’s counterclaim, contending that the
       evidence in the record showed that the policies at issue provided primary coverage. The parties
       filed with the court copies of the policies Lamorak issued to Kone for the years 1971 to 1985.
       Kone and Liberty also filed other documents, with no affidavits or depositions explaining how
       they came to possess the documents. Kone alleged that it received two of the documents from
       Lamorak in response to discovery, and Liberty similarly alleged that it received one of the
       documents from Lamorak in discovery. Lamorak argued that Kone and Liberty failed to
       authenticate all of the documents, but Lamorak did not deny the allegations that it had produced
       the three documents in discovery.
¶8         The Lamorak policy for 1976 to 1977 (the last with a deductible and not a SIR) provides:
                     “4. *** In the event of an occurrence, written notice *** shall be given by or for
                 the insured to the company *** as soon as practicable.
                                                      ***
                     6. Other Insurance: The insurance afforded by this policy is primary insurance ***.
                     When both this insurance and other insurance apply to the loss on the same basis,
                 *** the company shall not be liable under this policy for a greater proportion of the
                 loss than that stated in the applicable contribution provision below:
                     (a) Contribution by Equal Shares ***.
                     (b) Contribution by Limits. ***
                                                      ***
                     I. Coverage A—Bodily Injury Liability ***
                     The company will pay on behalf of the insured all sums which the insured shall
                 become legally obligated to pay as damages because of *** bodily injury *** to which
                 this insurance applies, caused by an occurrence, and the company shall have the right
                 and duty to defend any suit against the insured seeking damages on account of such
                 bodily injury *** even if any of the allegations of the suit are groundless, false or
                 fraudulent[,] and may make such investigation and settlement of any claim or suit as it
                 deems expedient.”
¶9         The policy set liability limits of $500,000 per occurrence and $500,000 aggregate, subject
       to a deductible of $25,000 per occurrence and $1 million aggregate. The policy does not specify
       a total premium, but it sets an estimated annual premium of $516,000.
¶ 10       The policy at issue for 1977-78 used the same form as the 1976-77 policy, including the
       same language in paragraphs 4 and 6 and section I, concerning the duty to give notice, the

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       effect of other insurance, and the duty to defend. However, the policy included a “Self-Insured
       Retention Endorsement” that modified several clauses. The endorsement provides:
                    “In consideration of the reduced premium for which this policy is issued, it is agreed
                that the company’s obligation to pay on behalf of the insured all sums which the insured
                shall become legally obligated to pay as damages and expenses in accordance with the
                insurance provided by this policy *** is in excess of the retained limit ***.
                    The company’s right and duty to defend any suit against the insured *** shall apply
                solely as follows:
                    1. When the amount of all claims or suits seeking damages as a result of one
                occurrence does not exceed the retained limit, as estimated by the company, the
                company shall have the right but not the duty to make such investigations thereof as it
                deems necessary but the company shall have no obligation to defend ***.
                    2. When the amount of all claims or suits seeking damages as a result of one
                occurrence is in excess of the retained limit, as estimated by the company, the company
                shall have the right and duty to defend such claim or suit even if any of the allegations
                of the claim or suit are groundless, false or fraudulent[,] and may make such
                investigation and settlement of the claim or suit as it deems expedient.”
¶ 11       The endorsement does not modify the duty to give notice of paragraph 4, but it expressly
       modified paragraph 6 as follows:
                    “ ‘Other insurance’ is amended to read:
                    The insurance afforded by this policy is excess insurance, applicable excess of the
                retained limit, for the limit of liability stated in the declarations of this policy. When
                both this insurance and other insurance apply to loss on the same basis, the company
                shall not be liable under this policy for a greater proportion of the loss than stated in
                the applicable contribution provision below:
                    (1) Contribution by equal shares ***.
                    (2) Contribution by limits.”
¶ 12       The policy sets liability limits of $2 million per occurrence and $2 million aggregate,
       subject to “retained limit[s]” of $100,000 per occurrence and $2 million aggregate. The policy
       sets its estimated premium at $1,085,000.
¶ 13       Also for the 1977-78 year, Kone purchased from Lamorak an umbrella policy, which
       provided:
                    “7. Notice of Occurrence. When an occurrence takes place which, in the opinion of
                the Insured, involves or may involve liability on the part of the company, prompt
                written notice shall be given by or on behalf of the Insured to the company ***.
                                                      ***
                    12. Other Insurance. If any other valid and collectible insurance exists protecting
                the Insured against ultimate net loss covered by this policy *** this policy shall be null
                and void with respect to such loss ***; provided, however, if the amounts recoverable
                by the Insured under such other insurance are not sufficient to completely protect the
                Insured against such loss, this policy shall apply but only as excess insurance over such
                other valid and collectible insurance.”

                                                    -4-
¶ 14       The policy set liability limits of $5 million per occurrence and $5 million aggregate, subject
       to the underlying Lamorak policy and the SIR. The umbrella policy set its premium at
       $187,500.
¶ 15       The circuit court found no need to consider any documents other than the insurance
       policies. The court entered a judgment declaring that the Lamorak policies at issue for 1977 to
       1985 all served as primary insurance. The court added a finding, pursuant to Illinois Supreme
       Court Rule 304(a) (eff. Mar. 8, 2016), of no just cause to delay enforcement or appeal from
       the declaratory judgment order. Lamorak filed a timely notice of appeal.

¶ 16                                              ANALYSIS
¶ 17                                               Jurisdiction
¶ 18       After the parties submitted their briefs on appeal, we questioned our jurisdiction and asked
       Lamorak why we should not dismiss the appeal. The circuit court’s order did not dispose of
       any count of any complaint or counterclaim, and it did not finally determine the rights of any
       party to the case. The declaratory judgment resolved only an issue that formed a partial basis
       for the relief Kone sought, as Kone requested in its counterclaim a declaration that the 1977 to
       1985 policies imposed on Lamorak a duty to defend and indemnify Kone, and the declaration
       that the policies count as primary insurance did not fully resolve that claim.
¶ 19       Lamorak argued that this court has jurisdiction under the reasoning of In re Marriage of
       Best, 228 Ill. 2d 107 (2008). In Best, the husband filed a petition for divorce, and in the divorce
       proceedings, he filed a motion for a judgment declaring that a valid premarital agreement
       limited the wife’s property rights in the divorce proceeding. The circuit court entered a
       judgment finding the premarital agreement valid and added a finding of appealability. Best,
       228 Ill. 2d at 110. Our supreme court held that the declaratory judgment finally resolved a
       separate part of the case. The court found that the husband had requested two distinct forms of
       relief: dissolution of the marriage and a judgment declaring the premarital agreement valid.
       The court said,
                “[The] declaratory judgment could be entered even if the dissolution petition were not
                granted. *** Under the facts and circumstances in this case, the request for dissolution
                of the parties’ marriage and the request for declaratory judgment on the validity and
                interpretation of the premarital agreement are not so closely related that they must be
                deemed part of a single claim for relief.” Best, 228 Ill. 2d at 115.
¶ 20       We find that the order here finally resolves a claim separate from the other claims for relief.
       The circuit court’s declaratory judgment grants Kone and Liberty effective relief even if the
       court decides eventually to grant Lamorak the relief it seeks in its complaint. The declaratory
       judgment concerning the policies at issue could affect the liability of all insurers involved not
       only in this case, but also in all of the other cases involving claims against Kone for injury due
       to asbestos exposure. Accordingly, we find that Illinois Supreme Court Rule 304(a) (eff. Mar.
       8, 2016) gives us jurisdiction to decide the appeal.

¶ 21                                     Horizontal Exhaustion
¶ 22       The parties and the circuit court agree that Kajima Construction Services, Inc. v. St. Paul
       Fire & Marine Insurance Co., 227 Ill. 2d 102 (2007), requires horizontal exhaustion under the
       circumstances of this case. The injury to Nichol occurred as a result of repeated exposure to

                                                    -5-
       asbestos over a number of years. The insurance policies for all of those years provide some
       potentially relevant coverage. In Kajima, the parties agreed that “horizontal exhaustion
       requires an insured to exhaust all available primary limits before invoking excess coverage.”
       Kajima, 227 Ill. 2d at 113. The Kajima court explained that
               “horizontal exhaustion is based on a recognition of the difference between primary and
               excess insurance. *** [W]hen excess insurance exists as part of an overall insurance
               package, it provides a secondary level of coverage to protect the insured where a
               judgment or settlement exceeds the primary policy’s limits of liability. [Citation.]
               Excess insurance coverage attaches only after a predetermined amount of primary
               insurance or self-insured retention has been exhausted. [Citation.] Consequently, until
               the limits of primary insurance coverage are exhausted, secondary coverage does not
               provide any collectible insurance. [Citation.] Once an excess policy is triggered in a
               case, the limits of the primary insurance must be exhausted before the excess carrier
               will be required to contribute to a settlement or judgment.” (Internal quotation marks
               omitted.) Kajima, 227 Ill. 2d at 114-15.
¶ 23        The parties here agree that the umbrella policies Lamorak issued to Kone for 1977 to 1985
       count as excess insurance, and Lamorak owes nothing on those policies until Kone exhausts
       the limits of all applicable primary insurance. We must decide whether the Lamorak policies
       at issue count as excess policies or as primary policies. If the policies count as excess insurance,
       Lamorak will have no liability for 1977 to 1985 until Kone exhausts the policy limits for all of
       its primary policies covering the years each injured employee worked. If the Lamorak policies
       provide primary insurance, Lamorak’s liability on those policies for 1977 to 1985 will fall on
       the same level as all other primary insurance. Because the circuit court decided the issue on a
       motion for summary judgment, we review the circuit court’s ruling de novo. Outboard Marine
       Corp. v. Liberty Mutual Insurance Co., 154 Ill. 2d 90, 102 (1992).

¶ 24                                          Primary or Excess
¶ 25        Lamorak contends that the circuit court’s judgment, that the policies at issue provide
       primary coverage, conflicts with the holding of Missouri Pacific R.R. Co. v. International
       Insurance Co., 288 Ill. App. 3d 69 (1997). In Missouri Pacific, hundreds of Missouri Pacific
       employees sought damages for injuries resulting from asbestos exposure occurring over the
       course of many years. Missouri Pacific acknowledged that it purchased only excess insurance
       for the years at issue, and the policies referred to Missouri Pacific’s SIR. Missouri Pacific, 288
       Ill. App. 3d at 72. Missouri Pacific argued that SIRs did not count as “ ‘other insurance’ ”
       within the meaning of the excess policies. Missouri Pacific, 288 Ill. App. 3d at 74. The
       Missouri Pacific court rejected the argument and held that “Missouri Pacific must exhaust the
       SIRs before looking to the insurers for coverage. *** [T]he SIRs in the present case constitute
       primary coverage.” Missouri Pacific, 288 Ill. App. 3d at 82.
¶ 26        Lamorak argues that Missouri Pacific stands for the proposition that SIRs always count as
       primary insurance and that any policy that refers to an underlying SIR counts as an excess
       policy for purposes of horizontal exhaustion. We do not read Missouri Pacific so broadly. The
       Missouri Pacific court specified that Missouri Pacific’s SIRs counted as primary insurance,
       subject to horizontal exhaustion. The Missouri Pacific court did not restrict the freedom of
       others to enter into contracts that may provide for SIRs and insurance coverage with other
       effects.

                                                    -6-
¶ 27       Lamorak’s argument that any policy that refers to a SIR must constitute an excess policy
       conflicts with insurance practice in Illinois. In Roman Catholic Diocese of Joliet, Inc. v. Lee,
       292 Ill. App. 3d 447, 449 (1997), the plaintiff purchased primary insurance for 1985 to 1986,
       with a liability limit of $100,000 over a SIR of $100,000. The plaintiff also purchased an excess
       policy for the same period. Similarly, in Rosalind Franklin University of Medicine & Science
       v. Lexington Insurance Co., 2014 IL App (1st) 113755, ¶ 20, the court noted, “[t]he primary
       policy issued by Lexington is a ‘Healthcare Professional Services Liability Policy’
       (hereinafter, the Lexington Primary Policy), which contains a limit of $1 million per ‘medical
       incident,’ subject to a $100,000 self-insured retention.” In Travelers Indemnity Co. v. American
       Casualty Co., 337 Ill. App. 3d 435, 439 (2003), the court said that a “primary policy typically
       covers claims starting at the first dollar of loss or the first dollar in excess of a deductible or
       self-retention.”
¶ 28       Thus, the reference to a SIR does not, in itself, resolve the question of whether the policy
       counts as an excess policy or a primary policy. An insured may bear the burden of a SIR and
       purchase a primary policy that refers to the underlying SIR. Illinois courts have discussed
       several characteristic distinctions between primary and excess policies. Excess policies
               “generally do not require immediate notice of an occurrence as do provisions in primary
               policies. [Citation.] Excess insurers are not interested in every accident, but only in
               those that may be serious enough to involve [them]. [Citation.] Since excess coverage
               is contingent on exhaustion of primary or underlying policies, excess insurers generally
               do not require notification of occurrences until the excess policy is reasonably likely to
               be implicated. [Citation.] Consequently, insurance policies for excess coverage
               generally grant the insured some discretion in evaluating the case.” (Internal quotation
               marks omitted.) American States Insurance Co. v. National Cycle, Inc., 260 Ill. App.
               3d 299, 311 (1994).
       “Primary insurance is coverage whereby liability attaches immediately upon the happening of
       the occurrence that gives rise to liability. [Citation.] Primary policies generally impose on the
       insurer a duty of defense separate from the duty to indemnify the insured against the claim.
       *** Rather than providing a duty to defend, most excess policies require the excess insurer to
       indemnify the insured for the costs of the defense as part of the ‘ultimate net loss’ against
       which the policy insures.” Krusinski Construction Co. v. Northbrook Property & Casualty
       Insurance Co., 326 Ill. App. 3d 210, 219 (2001). Excess insurers usually charge much smaller
       premiums than primary insurers. “[T]his disparity in premiums is indicative of the reduced risk
       assumed by the [excess] policy.” Illinois Emcasco Insurance Co. v. Continental Casualty Co.,
       139 Ill. App. 3d 130, 133 (1985). For primary policies that have deductibles or SIRs, as with
       excess policies, “liability attaches only after a predetermined amount of *** coverage has been
       exhausted. *** This reduced risk is reflected in the cost of the policy.” Whitehead v. Fleet
       Towing Co., 110 Ill. App. 3d 759, 764 (1982).
¶ 29       Here, the policies at issue establish that Kone had a duty to notify Lamorak of any
       occurrence, regardless of the amount of potential liability. The policies at issue impose on
       Lamorak a duty to defend if the liability appears likely to exceed the SIR. Notably, the policies
       do not give Kone discretion to decide whether liability will likely exceed the SIR. Lamorak
       reserved for itself that discretion. See American States, 260 Ill. App. 3d at 311. Finally, the
       premiums for the policies at issue greatly exceed the premiums for the contemporaneous
       umbrella policies, which covered much greater dollar amounts of liability for a wider group of

                                                    -7-
       risks. The three most notable characteristics of primary insurance all indicate that the policies
       at issue constitute primary insurance.
¶ 30        Lamorak relies heavily on the policy language that expressly makes the policies “excess
       insurance, applicable excess of the retained limit.” The policies also state that “[i]n
       consideration of the reduced premium for which this policy is issued, it is agreed that the
       company’s obligation to pay *** is in excess of the retained limit.” Insofar as that language
       introduces some ambiguity into interpretation of the policies, we may look to the documents
       the parties presented to resolve the ambiguity. See Benedict v. Federal Kemper Life Assurance
       Co., 325 Ill. App. 3d 820, 824 (2001).
¶ 31        Kone appended to its motion for summary judgment several documents bearing legends
       that indicate creation in 1977. Kone presented no affidavits, depositions, or other evidence to
       explain how it obtained the documents. In its brief, Kone asserted that the documents were
       “produced by the parties in discovery,” but Kone did not say which parties produced which
       documents, except that Kone identified two charts as coming from Lamorak. Liberty also
       asserted in its brief that one document appended to the motion came from Lamorak in
       discovery. Lamorak objected that the documents appended to the motions lacked proper
       authentication, but it did not deny the assertion that it had produced the three documents in
       discovery.
¶ 32        Rule 803(16) of the Illinois Rules of Evidence (Ill. R. Evid. 803(16) (eff. Apr. 26, 2012))
       provides that the hearsay rule does not require exclusion of “[s]tatements in a document in
       existence 20 years or more the authenticity of which is established.” Rule 901(a) of the Illinois
       Rules of Evidence (Ill. R. Evid. 901(a) (eff. Jan. 1, 2011)) provides, “The requirement of
       authentication or identification as a condition precedent to admissibility is satisfied by
       evidence sufficient to support a finding that the matter in question is what its proponent
       claims.” For an allegedly ancient document, the rule requires evidence that the document “(A)
       is in such condition as to create no suspicion concerning its authenticity, (B) was in a place
       where it, if authentic, would likely be, and (C) has been in existence 20 years or more at the
       time it is offered.” Ill. R. Evid. 901(b)(8) (eff. Jan. 1, 2011). Kone and Liberty presented no
       affidavits or testimony to support findings about when or how they found most of the
       documents they appended to their motion for summary judgment. The presence of “1977” on
       a sheet of paper does not suffice to make a document self-authenticating. See Ill. R. Evid. 902
       (eff. Jan. 1, 2011). We ignore the documents that lack authentication.
¶ 33        But Kone and Liberty asserted that Lamorak produced three of the documents in discovery,
       and Lamorak has not disputed that assertion. When Illinois courts interpret the rules of
       evidence, the courts may look to federal cases for guidance. People v. Thompson, 2016 IL
       118667, ¶ 40. In Architectural Iron Workers Local No. 63 Welfare Fund v. United Contractors,
       Inc., 46 F. Supp. 2d 769, 771 (N.D. Ill. 1999), the plaintiff filed many exhibits and the
       defendant objected that several specific exhibits were “inadmissible because they [were]
       unsupported by affidavit or deposition testimony.” The plaintiff asserted that some of the
       specified exhibits “were all produced during the course of the litigation in response to
       Plaintiffs’ requests for documents.” Architectural Iron Workers, 46 F. Supp. 2d at 772. The
       Architectural Iron Workers court held that “documents produced in response to discovery are
       self-authenticating. *** [T]here is no error to admit as evidence documents that Defendants
       themselves possess and produced in response to Plaintiff’s requests for production of
       documents.” Architectural Iron Workers, 46 F. Supp. 2d at 772.

                                                   -8-
¶ 34       Because Lamorak had an opportunity to determine whether it produced the contested
       documents in discovery, and it did not deny that it produced those documents, we find
       sufficient authentication for the three documents Liberty and Kone asserted that they received
       from Lamorak in discovery.
¶ 35       The first document so authenticated is a private wire, dated June 29, 1977, from an
       insurance agent to the Kone employee responsible for risk coverage. The agent stated that
       Lamorak was “binding the primary general liability program using the *** SIR.” The
       document supports the inference that the agent and Kone believed Lamorak had agreed to issue
       primary insurance subject to a SIR. The two charts from Lamorak show Kone’s coverage for
       1973 through 1985. Both charts identify the Lamorak policies by number and specify that the
       policies at issue count as “Primary.”
¶ 36       All the relevant indicators show that the policies at issue provide primary coverage. Insofar
       as the language of the policies might introduce some ambiguity, contemporaneous documents
       show that the parties understood that the policies at issue provided primary insurance. We hold
       that the policies at issue provided primary insurance coverage.

¶ 37                                        CONCLUSION
¶ 38       Insurance policies Lamorak issued to Kone for 1977 to 1985 imposed on Kone a duty to
       notify Lamorak of every occurrence, regardless of whether potential liability exceeded Kone’s
       SIR, and the policies established Lamorak’s duty to defend claims that appeared likely to
       exceed the SIR. The policies also had premiums far greater than the premiums for the umbrella
       policies Lamorak issued to Kone for the same years. Contemporary documents show that
       Lamorak and Kone understood that the policies at issue provided primary insurance subject to
       a SIR. Accordingly, we affirm the circuit court’s judgment declaring that the policies at issue
       provided primary insurance coverage to Kone.

¶ 39      Affirmed.

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