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IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2009 Term
MICHAEL BLANKENSHIP AND MISTY BLANKENSHIP,
Plaintiffs Below, Appellees,
THE CITY OF CHARLESTON AND
BOSTON CULINARY GROUP, INC., d/b/a DISTINCTIVE GOURMET,
Defendants/Third-Party Plaintiffs Below, Appellees,
LAKEWOOD SWIM CLUB, INC.,
Third Party Defendant/Fourth-Party Plaintiff Below, Appellant,
EVANSTON INSURANCE COMPANY,
Fourth-Party Defendant Below, Appellee
Appeal from the Circuit Court of Kanawha County
The Honorable James C. Stucky, Judge
Civil Action No. 06-C-2062
Submitted: April 8, 2009
Filed: June 18, 2009
C. Benjamin Salango
John F. McCuskey
Preston & Salango, PLLC Heather B. Osborn
Charleston, West Virginia Shuman, McCuskey & Slicer, PLLC
Counsel for the Appellant
Charleston, West Virginia
Counsel for the Appellee,
Evanston Insurance Company
The Opinion of the Court was delivered PER CURIAM.
SYLLABUS BY THE COURT
1. A circuit court's entry of summary judgment is reviewed de novo
Pt. 1, Painter v. Peavy
, 192 W.Va. 189, 451 S.E.2d 755 (1994).
2. A circuit court's entry of a declaratory judgment is reviewed de novo
Syl. Pt. 3, Cox v. Amick
, 195 W.Va. 608, 466 S.E.2d 459 (1995).
3. Determination of the proper coverage of an insurance contract when the
facts are not in dispute is a question of law. Syl. Pt. 1, Tennant v. Smallwood
, 211 W. Va.
703, 568 S.E.2d 10 (2002).
4. The interpretation of an insurance contract, including the question of
whether the contract is ambiguous, is a legal determination that, like a lower court's grant
of summary judgment, shall be reviewed de novo
on appeal. Syl. Pt. 2, Riffe v. Home
Finders Associates, Inc.
, 205 W. Va. 216, 517 S.E.2d 313 (1999).
5. Where the provisions of an insurance policy contract are clear and
unambiguous they are not subject to judicial construction or interpretation, but full effect
will be given to the plain meaning intended. Syl. Pt. 1, Christopher v. U.S. Life Ins
145 W. Va. 707, 116 S.E.2d 864 (1960).
6. Language in an insurance policy should be given its plain, ordinary
meaning. Syl. Pt. 1, Soliva v. Shand, Morahan & Co., Inc.
, 176 W.Va. 430, 345 S.E.2d 33
(1986), overruled on other grounds
by Nationwide Mut. Ins. Co. v. McMahon & Sons, Inc
177 W.Va. 734, 356 S.E.2d 488 (1987).
This is an appeal of fourth-party plaintiff below, Lakewood Swim Club, Inc.
(hereinafter Lakewood), from the December 11, 2007, order of the Circuit Court of
Kanawha County granting summary judgment in favor of fourth-party defendant below,
Evanston Insurance Co. (hereinafter Evanston), in a declaratory judgment action arising
in a negligence case. (See footnote 1)
The issues decided by the lower court involve whether Evanston had
a duty to indemnify or a duty to defend under the terms of the commercial general liability
insurance policy Lakewood had through Evanston. Having considered the arguments of the
parties, the record accompanying the appeal and the controlling law, we affirm the decision
of the lower court.
I. Factual and Procedural Background
The original tort claim from which this appeal arose was filed by Michael and
Misty Blankenship after Mr. Blankenship was injured at a concert at the Charleston Civic
Center when he slipped and fell near a concession stand where some beer had been spilled.
The defendants initially named in the complaint were the City of Charleston, as owner and
operator of the Civic Center, and Boston Culinary Group, d/b/a Distinctive Gourmet
(hereinafter Boston Culinary), as the manager of the beverage service at the Civic Center.
Boston Culinary joined Lakewood as a third-party defendant on the basis that Lakewood's
members were actually operating the concession when the accident occurred. (See footnote 2) In its
complaint, Boston Culinary maintained that Lakewood operated the concession pursuant to
a contract agreeing to indemnify and hold harmless Boston Culinary for any injury that may
occur from negligent operation of the concession by Lakewood. (See footnote 3)
Upon being named a party to the suit, Lakewood submitted a claim to
Evanston for coverage under a commercial general liability insurance policy it had with the
company. Finding that the claim was outside the terms of the policy in effect at the time of
the accident, Evanston informed Lakewood that it would not defend or indemnify Lakewood
with regard to the claim. Lakewood then filed a fourth-party complaint against Evanston,
seeking a declaration by the Court that Evanston Insurance Company Policy No.
CP470100909 (See footnote 4) provides coverage for the incident at issue. . . . Following discovery related
to this issue, Lakewood filed a motion for summary judgment as to its claim against
Evanston, to which Evanston filed a response with a cross-motion for summary judgment. (See footnote 5) After holding a hearing on the motions on December 6, 2007, the trial court granted
summary judgment in favor of Evanston by order entered December 11, 2007. The order
relates that summary judgment was granted as a matter of law for the following reasons:
12. Plaintiff's alleged bodily injury did not arise out of
the designated project (PRIVATE SWIM CLUB), as required
by the clear, plain and unambiguous language of the policy
issued to Lakewood Swim Club by Evanston Insurance
Company and, therefore, the Evanston Insurance Company
policy does not provide coverage for the claims asserted against
the swim club in this action.
13. The Court hereby finds that Evanston Insurance
Company has no duty to indemnify Lakewood Swim Club for
the claims arising out of plaintiff's alleged bodily injury, based
on the clear, plain and unambiguous language of the Evanston
Insurance Company policy.
14. The Court further finds that Evanston Insurance
Company has no duty to defend Lakewood Swim Club for the
claims arising out of plaintiff's alleged bodily injury, based on
the clear, plain and unambiguous language of the Evanston
It is from this order that Lakewood appealed and for which appellate review
was granted by this Court by order of October 9, 2008.
II. Standard of Review
This case is before us from a trial court's summary judgment order. A circuit
court's entry of summary judgment is reviewed de novo. Syl. Pt. 1, Painter v. Peavy, 192
W.Va. 189, 451 S.E.2d 755 (1994). Inasmuch as the summary judgment was entered with
regard to a declaratory judgment action, we further note that [a] circuit court's entry of a
declaratory judgment is reviewed de novo. Syl. Pt. 3, Cox v. Amick, 195 W.Va. 608, 466
S.E.2d 459 (1995). As we explained in Cox, because the purpose of a declaratory
judgment action is to resolve legal questions, a circuit court's ultimate resolution in a
declaratory judgment action is reviewed de novo. Id. at 612, 466 S.E.2d at 463.
Our review of the specific subject raised on this appeal is likewise plenary.
Lakewood is seeking review of the trial court's ruling that it was not entitled to
indemnification or a defense under the Evanston policy. Determination of the proper
coverage of an insurance contract when the facts are not in dispute is a question of law.
Syl. Pt. 1, Tennant v. Smallwood, 211 W. Va. 703, 568 S.E.2d 10 (2002). As [t]he
interpretation of an insurance contract, including the question of whether the contract is
ambiguous, is a legal determination . . ., like a lower court's grant of summary judgment, [it]
shall be reviewed de novo on appeal. Syl. Pt. 2, Riffe v. Home Finders Associates, Inc., 205
W. Va. 216, 517 S.E.2d 313 (1999).
Lakewood raises two assignments of error regarding the lower court's
determination concerning the insurance policy, one directed to Evanston's duty to defend
and the other to the company's duty to indemnify. (See footnote 6) In either instance, the duty turns on
whether coverage is extended under the insurance policy at issue for the type of activity the
Lakewood members engaged in on behalf of the club and which gave rise to the bodily
injury claim. Consequently, we begin our review with an examination of the pertinent
provisions of the insurance policy and relevant endorsements.
The general provisions of Lakewood's policy with Evanston reads:
COMMERCIAL GENERAL LIABILITY COVERAGE FORM
Various provisions in this policy restrict coverage. Read the
entire policy carefully to determine rights, duties, and what is
and is not covered.
* * * * *
SECTION I _ COVERAGES
COVERAGE A BODILY INJURY AND PROPERTY
1. Insuring Agreement
a. We will pay those sums that the insured
becomes legally obligated to pay as damages
because of bodily injury. . . to which this
insurance applies. We will have the right and
duty to defend the insured against any suit
seeking those damages. However, we will have
no duty to defend the insured against any suit
seeking damages for bodily injury . . . to which
this insurance does not apply. . . .[ (See footnote 7) ]
b. This insurance applies to bodily injury . . .
(1) The bodily injury . . . is caused by an
occurrence that takes place in the coverage
(2) The bodily injury . . . occurs during the
The coverage territory
as defined in the general policy is:
a. The United States of America (including its territories and
possessions), Puerto Rico and Canada;
b. International waters or airspace, provided the injury or
damage does not occur in the course of travel or transportation
to or from any place not included in a. above; or
c. All parts of the world [if stated conditions are met].
Two endorsements to the general insurance policy which are applicable to our
review are: (1) M/E_217, entitled Specified/Designated Premises/Project Limitation
(hereinafter endorsement M/E_217); and (2) M/E_011, entitled Additional Insured _
Club Members Endorsement (hereinafter endorsement M/E_011).
Appearing on the face of endorsement M/E_217 is the statement THIS
ENDORSEMENT CHANGES THE POLICY
, after which the following appears:
ST. ALBANS WV 25177
PRIVATE SWIM CLUB
(Complete above if information different than that shown in the
Declarations[ (See footnote 8) ]
This insurance applies only to bodily injury, property
damage, personal injury, advertising injury and medical
expenses arising out of:
1. The ownership, maintenance or use of the premises
shown in the Schedule (or Declarations); or
2. The project shown in the Schedule (or Declarations).
The same prefatory statement of THIS ENDORSEMENT CHANGES THE
appears on endorsement M/E_011. The body of this endorsement then states:
WHO IS AN INSURED (Section II) of the Commercial
General Liability coverage part is amended to include as an
insured any of your members, but only with respect to their
liability for your activities or activities they perform on your
Lakewood maintains that the policy does not restrict coverage to bodily injury
that occurs on Lakewood's premises. In support of this position, Lakewood reasons that the
general policy provisions provide coverage for bodily injuries occurring in the coverage
territory. Lakewood concedes that some restriction is placed on the broad definition of
coverage territory in the general policy by the terms of endorsement M/E_217 as the
Schedule it contains identifies the premises. However, Lakewood maintains that although
endorsement M/E_217 itemizes the Project in the Schedule as PRIVATE SWIM CLUB,
it neither defines nor restricts the definition of the term project. Lakewood asserts that
affidavits of two Lakewood members which were supplied to the trial court establish that
operation of the concession stand by the club on the night of the incident was a fund-raising
project of the private swim club. Because running the concession was a fund-raising project
of the private swim club, Lakewood postulates that the Blankenship claim falls within the
coverage of the policy due to the provisions of endorsement M/E_011. According to
Lakewood, the terms of endorsement M/E_011 extends coverage to these type of member
activities wherever they occur by expressly providing that as an insured any of your
members [are covered], but only with respect to their liability for your activities or activities
they perform on your behalf.
Evanston contends that the lower court's ruling is correct because endorsement
M/E_217, not endorsement M/E_011, controls the issue of coverage. Evanston first
maintains that endorsement M/E_011 is irrelevant because the Blankenship claim is against
Lakewood and not its members. Evanston then proposes that even if the claim had been
made against Lakewood's members individually, coverage would still not be available under
the express terms of endorsement M/E_217 which requires either that the bodily injury arises
from the ownership, maintenance or use of the private swim club premises or that the injury
results from the project identified in this endorsement as PRIVATE SWIM CLUB.
It is well-established that [w]here the provisions of an insurance policy
contract are clear and unambiguous they are not subject to judicial construction or
interpretation, but full effect will be given to the plain meaning intended. Syl. Pt. 1, Christopher v. U.S. Life Ins. Co.
, 145 W. Va. 707, 116 S.E.2d 864 (1960). The lower
court's ultimate conclusion as reflected in the summary judgment order is that the alleged
bodily injury did not arise out of the designated project of PRIVATE SWIM CLUB as
required by the clear, plain and unambiguous language of the policy. We agree.
Counsel for Lakewood during oral argument stressed the significance of the
expansive definition of coverage territory in the general policy. However, an equally
important provision of the general policy is the cautionary introductory statement that
[v]arious provisions in this policy restrict coverage [and one has to] [r]ead the entire policy
carefully to determine rights, duties and what is not covered. There is no dispute that the
endorsements are part of the policy and endorsement M/E_217 clearly qualifies the types of
bodily injury claims that are covered under the policy by stating that [t]his insurance
to 'bodily injury' . . . arising out of . . . ownership, maintenance or use of the
[Lakewood Dr., St. Albans, W.Va.] premises . . . or [t]he
project shown in the Schedule [as
PRIVATE SWIM CLUB]. (Emphasis added.) Use of the disjunctive or
Lakewood's position that the injury does not have to occur on the private swim club
premises. Nevertheless, we do not find that the language of endorsement M/E_217
contemplates that any
undertaking of the club members is a project for which coverage
under the policy extends. Endorsement M/E_217 defines the
project applicable to the
policy as PRIVATE SWIM CLUB. Although endorsement M/E_011 provides that
activities of members performed on behalf of the club are covered under the policy, the
activities still must conform with the
project defined in endorsement M/E_217. This is true
because all of these endorsement provisions, declarations and standard contract provisions
comprise the commercial general liability insurance policy Lakewood had with Evanston as
clearly indicated on the Supplemental Declarations page of the contract.
It is well-established that the [l]anguage in an insurance policy should be
given its plain, ordinary meaning. Syl. Pt. 1, Soliva v. Shand, Morahan & Co., Inc.
W.Va. 430, 345 S.E.2d 33 (1986), overruled on other grounds
by Nationwide Mut. Ins. Co.
v. McMahon & Sons, Inc.
, 177 W.Va. 734, 356 S.E.2d 488 (1987). Applying this standard
to the facts at hand, we conclude, as did the lower court, that selling beer at a concession
stand at a concert open to the public in a location other than the private swim club premises
is an activity beyond the ordinary meaning or purpose of a project defined as a private swim
club. Where an insurance policy is clear and unambiguous, [t]he court is bound to adhere
to the insurance contract as the authentic expression of the intention of the parties, and it
must be enforced as made where its language is plain and certain. Keffer v. Prudential
Insurance Company of America
, 153 W. Va. 813, 816, 172 S.E.2d 714, 716 (1970). [T]he
court cannot make a new contract for the parties where they themselves have employed
express and unambiguous words. Id.
Consequently, it is unnecessary to consider any
argument raised regarding the reasonable expectation of coverage based on extrinsic
evidence of intent of the parties, such as the application for insurance. As we explained in National Mutual Insurance Co. v. McMahon & Sons, Inc.
, [i]n West Virginia, the doctrine
of reasonable expectations is limited to those instances . . . in which the policy language is
ambiguous. 177 W.Va. at 742, 356 S.E.2d at 496.
Because the policy did not extend insurance coverage to the type of project
giving rise to the injury in question, the lower court was correct in finding that Evanston had
no duty to defend or duty to indemnify the Blankenship claim against Lakewood.
Accordingly, we affirm the decision of the lower court.
Based upon the foregoing reasons, we affirm the December 11, 2007,
summary judgment order of the Circuit Court of Kanawha County.
The original underlying tort claim was brought by Michael and Misty
Blankenship against the City of Charleston and Boston Culinary Group, Inc., d/b/a
Distinctive Gourmet. None of the original parties are directly involved in this appeal.
The Blankenships later amended their complaint naming Lakewood as a
defendant and asserting that Lakewood negligently operated the concession stand.
There remains an unresolved dispute before the lower court as to whether
Lakewood was a party to the concession operation contract with Boston Culinary.
Relevant portions of this policy are set forth infra
, within the Discussion
section of this opinion.
The record does not reflect that Lakewood filed a written response to
Evanston's cross-motion for summary judgment.
An insurer's duty to defend is not synonymous with an insurer's duty to
indemnify. We recognized the distinction in Aetna Casualty & Surety Company v. Pitrolo,
176 W.Va. 190, 194, 342 S.E.2d 156, 160 (1986), as follows:
As a general rule, an insurer's duty to defend is tested by
whether the allegations in the plaintiff's complaint are
reasonably susceptible of an interpretation that the claim may be
covered by the terms of the insurance policy. . . . [I]t is
generally recognized that the duty to defend an insured may be
broader than the obligation to pay under a particular policy.
This ordinarily arises by virtue of language in the ordinary
liability policy that obligates the insurer to defend even though
the suit is groundless, false, or fraudulent.
Item 14 in the Combination General Endorsement to the policy further states:
Where there is no coverage under this policy, there is no duty to defend.
The common policy declarations do not address a premises location (it does
list the mailing address of the insured as 2088 LAKEWOOD DR., ST ALBANS, WV
25177), nor does it identify a project (it does, however, list a business description as
PRIVATE SWIM CLUB. The Supplemental Declarations portion of the policy in the
record contains the following statement:
Location of all premises you own, rent or occupy:
LAKEWOOD RD., ST ALBANS WV 25177
It also contains a listing of forms and endorsements made part of the policy which includes
both endorsement M/E_011 and endorsement M/E_217. The final statement on the
Supplemental Declarations page states:
THIS SUPPLEMENTAL DECLARATIONS AND THE
COMMERCIAL LIABILITY DECLARATIONS,
TOGETHER WITH THE COMMON POLICY CONDITIONS,
COVERAGE FORM(S) AND ENDORSEMENTS
COMPLETE THE ABOVE NUMBERED POLICY.