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Stickovich v. City of Cleveland8/2/2001
e the matter.
Although no findings were made concerning the workers' claims or damages, against Cleveland or any of the other parties, Commercial Union agreed to pay Stickovich and Straight $1.3 million to dismiss their complaint. Also surrendered without adjudication were Cleveland's defenses. ICC was found liable to Construction Supplies for damage to its crane. All remaining claims were ultimately resolved or dismissed.
Commercial Union now appeals from the trial court's order granting Cleveland's motion for summary judgment and denying its cross-motion for summary judgment. Commercial Union argues that its own CGL liability insurance coverage is void and against public policy and contends that the trial court erroneously construed it to provide coverage for negligence of Cleveland, the additional insured.
Commercial Union raises the following sole assignment of error:
THE TRIAL COURT IMPROPERLY DETERMINED THAT THE ADDITIONAL INSURED CLAUSE IN THE CONTRACTOR'S GENERAL COMMERCIAL LIABILITY INSURANCE POLICY PROVIDED COVERAGE FOR THE ADDITIONAL INSURED'S OWN NEGLIGENCE. THUS, THE TRIAL COURT'S GRANTING OF SUMMARY JUDGMENT IN FAVOR OF THIRD- PARTY PLAINTIFF-APPELLEE [CITY OF CLEVELAND] REQUIRES REVERSAL. This assignment lacks merit.
Commercial Union disputes its duty to defend or pay its settlement and seeks an order from this court that it recover these costs. Commercial Union argues it had no duty because Cleveland does not qualify under the CGL policy as an additional insured under the following endorsement:
WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown in the Schedule [Cleveland], but only with respect to liability arising out of your work for that insured by or for you. (Emphasis added.)
It argues that the trial court improperly determined that the additional insured endorsement covered Cleveland's own negligence in violation of R.C. 2305.31.
Standard principles governing insurance law and motions for summary judgment warrant affirming the trial court's judgment. Summary judgment is warranted when, after viewing the evidence in the light most favorable to the non-moving party, there is no genuine issue of material fact, reasonable minds can come to but one conclusion, and the moving party is entitled to judgment as a matter of law. Civ.R. 56(C). After reviewing the record in accordance with this standard, we conclude the trial court properly granted Cleveland's motion and properly denied Commercial Union's cross-motion for summary judgment.
Waiver
We note initially that Commercial Union did not properly raise the affirmative defense that the coverage of its own CGL additional insured endorsement violated R.C. 2305.31. The record shows that its letter denying coverage did not mention R.C. 2305.31 or public policy as reasons. Moreover, Commercial Union's Answer to Cleveland's Third-Party Complaint likewise did not mention as required by Civ.R. 8(C) the affirmative defense of illegality of its own insurance coverage. It is well established that unpleaded affirmative defenses are deemed to be waived. E.g., Jim's Steak House, Inc. v. Cleveland (1998), 81 Ohio St.3d 18.
This court recently held that this precise defense was waived under these circumstances in Blount v. Digital Equipment Corp. (Feb. 3, 2000), Cuyahoga App. No. 75298, unreported, stating as follows:
We also reject Net-Tech's argument that the indemnification agreement violates R.C. 2305.31. A defense alleging the illegality of a contract is an affirmative defense. Countrymark Coop. v. Smith (1997), 124 Ohio App.3d 159, 164, 705 N.E.2d 738
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