Court Opinion

ID: 9493691
Source: CourtListenerOpinion
Date Created: 2023-08-05 15:15:38.105091+00
Date Added: 2024-06-11T17:55:58.470115
License: Public Domain

WILKINS, Circuit Judge,
dissenting:
I respectfully dissent. In my view, the majority, while acknowledging that “the duty to defend exists only if ... the insurance contract contains language that imposes that duty,” ante, at 142, proceeds to ignore that rule and rewrite the insurance contract based on the majority’s perception of the terms to which it would have expected the parties to agree.
The relevant contract language is as follows. The form policy contains a “Section I-Coverages,” which is divided into three subsections: “Coverage A. Bodily Injury and Property Damage Liability,” “Coverage B. Personal and Advertising Injury Liability,” and “Coverage C. Medical Payments.” J.A. 21-25. Subsection A states, “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.” Id. at 21 (emphasis added). Subsection B states, “We will pay those sums that the insured becomes legally obligated to pay as damages because of ‘personal injury’ or ‘advertising injury’ to which this coverage part applies. We will have the right and duty to defend any ‘suit’ seeking those damages.” Id. at 24 (emphasis added). Subsection C states, “We will pay medical expenses as described below for ‘bodily injury....’” Id. at 25. This subsection contains no language concerning a duty to defend. Similarly, the special endorsement appended to the policy states, “We will pay those sums you become legally obligated to pay as damages arising out of’ check stop payment claims. Id. at 41. Like Subsection C, and unlike Subsections A and B, however, the endorsement at issue contains no language creating a duty to defend.
Instead of focusing on the contractual terms to which the parties agreed, the majority’s analysis consists primarily of its identification of a number of reasons why it would have made sense for the contract to impose a duty to defend check stop payment claims. These include (1) that the policy provides for a duty to defend in regard to the other categories of liability coverage, (2) that liability coverage generally includes a duty to defend, (3) that certain conditions in the policy would have no benefit to the insurer with regard to check stop payment claims if there were no duty to defend, (4) that it was in the insurer’s interest that the policy provide for a right and duty to defend, and (5) that the insurer initially concluded that it had a duty to defend.
The closest the majority comes to identifying any contract language purportedly creating a duty to defend check stop pay-*149merit claims is when it notes that by its terms the endorsement “modifies insurance provided under the ... Commercial General Liability Part” of the policy. Id. The majority appears to believe that the “modifies” language indicates that the endorsement is a modification of Subsections A or B rather than a “stand-alone provision,” and therefore that the duty to defend language from those subsections applies to check stop payment claims as well. Ante, at 144-45. The majority’s analysis would be correct if the policy stated that the insurer had a duty to defend any suit in which the policy would provide coverage for a judgment against the insured. In that case, since the endorsement is incorporated into the policy, the general duty to defend would apply to check stop payment claims. The policy imposes no such general duty to defend, however. Rather, the insurer’s duty to defend explicitly extends only to claims of “bodily injury and property damage” and “personal and advertising injury.” Accordingly, even if the special endorsement is read as part of Subsection A or Subsection B, that does not change the fact that the duty to defend language in those subsections unambiguously does not apply to check stop payment claims.
In sum, I agree with the majority to the extent that it concludes that the parties might have been expected to have agreed that there would be a duty by the insurer to defend regarding check stop payment claims. Nevertheless, the law of Maryland is clear that a court should not undertake to rewrite an unambiguous insurance contract so as to provide for coverage that otherwise would not exist. See Hankins v. Public Service Mut. Ins. Co., 192 Md. 68, 63 A.2d 606, 613 (1949); Bernhardt v. Hartford Fire Ins. Co., 102 Md.App. 45, 648 A.2d 1047, 1052 (1993). Accordingly, I believe the district court correctly entered judgment against Provident, and I would affirm.