ÿWPCæ 3# ÚUNå %3 0G9U:€w@º4úL%qU:y 0J³ 0Tý 0^Q 0h¯ 0r 0|‰ 0† 0‹ 1u 0d 0@ô D34 Bg U>„ U* B)ì DC AQX Æ© 0Do 0D³ D/÷ B& AMC  v~•vÓ˜HP LaserJet 4SiHPPCL5MS,ü,,,,,ü0nLLÎ(ÈhH  Z 6Times New Roman RegularX('\$¡¡Ô€XåÙXXMXÔ,c½¬AZ‹"Arial Regular bUcDdgefghiUjÓ€v§aö"3|xvC:\OFFICE\WPWIN\TEMPLATE\STANDARD.WPTÂ"Arial Regular2 ÿÿ0Indent1Ô2ÔÔ3  Ô2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ("ÿÿ$££Ò  ÒÒ  Ò""""'ÿÿdxd d< Œ 9p`(&Times New Roman< Œ 9p`(Arial% Line 7 d''''7Border 1dd*+ ,-Cþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5(3¯$¢¢Ý ƒ!ÝÝ  Ý($$””ò òÚ  Ú1Ú  Úó ó..'÷ÿ dxdüÿP Pd* (Cþÿ << Gÿÿ ûÝ ƒ!ÝÔ€%ÔÔ€&ÔÝ  ÝÝ ƒ+"ÝÝ  ÝÔ€&ÔÓ  ÓÔ YYY ÔFILEDÔ€&XÔÌÌò òAugust€19,€1997ÌÌCecil€Crowson,€Jr.ÌÔ€&ôÔAppellate€Court€Clerkó óPtPtHHÚ(ÿáÿâùFG(üHHÚ(d'hStyl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  h HD: Geneva ÒÒ  h HD: Geneva ÒÝ ƒ!ÝÔ . ÔÔ€%ÔÔ€&ÔÝ  ÝÑ\R AØ'\ÑÓ  ÓÑ\R AØ'\ÑÑ7€|ÇXXdðXXdð7Ñ›Þ ÞÌà@ àò òIN€THE€COURT€OF€APPEALS€OF€TENNESSEEÌà@ àWESTERN€SECTION€AT€JACKSONÌÌÌJOSEPH€LEIBOVICH,€EXECUTOR€OFà à)ÌTHE€ESTATE€OF€EVELYN€G.€JORDAN)ÌAND€JOHN€JORDAN,à àà àà à)€€Ìà àà àà àà àà àà à)€Ìà àà àó óPlaintiffs/Appellees,à àò ò)€Shelby€Circuit€No.€38197€T.D.Ìà àà àà àà àà àà à)ÌVS.à àà àà àà àà àà à)€€Appeal€No.€02A01„9608„CV„00192̜ـ*ÙßR€/0(A1-j|žù` Å `€€@ÿRß›à àà àà àà àà àà à)Ìà àà àà àà àà àà à)ÌTHE€KROGER€COMPANY,€à àà à)ÌTOPVALCO,€INC.,€MID„SOUTHà àà à)ÌAUTOMATIC€DOOR€AND€BESAM,€à à)ÌINC.,à àà àà àà àà àà à)Ìà àà àà àà àà àà à)Ìà àà àó óDefendants/Appellants.à àò ò)ó óÌÌÌà@ àAPPEAL€FROM€THE€CIRCUIT€COURT€OF€SHELBY€COUNTYÌà@ àAT€MEMPHIS,€TENNESSEEÌà@ àTHE€HONORABLE€DððARMY€BAILEY,€JUDGEÌÌÌÌÌÌò òJOHN€R.€CANNON,€JR.ó óÌò òTHE€HARDISON€LAW€FIRMÌó óMemphis,€TennesseeÌAttorney€for€AppellantÌÌÌÌò òSAM€L.€CRAIN,€JR.ÌSTEPHEN€D.€CRAWLEYÌSCOTT€J.€CROSBYó óÌMemphis,€TennesseeÌAttorneys€for€AppelleeÌÌÌÌÌÌò òREVERSED€AND€REMANDEDÌÌÌó óà àà àà àà àà àà àà àà àà àò òALAN€E.€HIGHERS,€J.ÌÌÌÌCONCUR:ÌÌW.€FRANK€CRAWFORD,€P.J.,€W.S.ÌÌDAVID€R.€FARMER,€J.ó óà àœÌÓÓà àÌà àIn›€this€personal€injury€action,€Joseph€Leibovich€(ð ðPlaintiffðð)€filed€suit€as€theÏexecutor€Ñ7€«ßXXdðXXdð7Ñof€the€estate€of€Evelyn€Jordan€œ(ð ðJordanðð)€and›€her€husband,€John€Jordan,€forÏœinjuries›€Jordan€sustained€as€a€result€of€being€struck€by€œautomatic€doors›€that€œclosed›Ïupon€her.€€Plaintiff€alleged€that€the€negligence€of€œthe€Defendants,›€The€KrogerÏCompany,€Topvalco,€Inc.,€Mid„South€Automatic€Door€(ð ðMid„Southðð),€and€Besam,€Inc.Ïœ(ð ðBesamðð),€combined›€to€œcause€Jordanððs›€injury.€€œBesam€cross„claimed€against€Mid„South€for€breach€of€contract€based€upon€Mid„Southððs€failure€to€have€Besam€named€asÏa€co„insured€on€Mid„Southððs€policy€of€liability€insurance€for€the€1989„1990€year.€ÏBesam€filed€a€motion€for€summary€judgment€on€its€cross„claim€against€Mid„South.€€TheÏtrial€court€granted€Besamððs€motion€for€summary€judgment€on€its€cross„claim€againstÏMid„South€and€held€that€Mid„South€breached€its€distributorship€agreement€withÏBesam€by€failing€to€name€Besam€as€a€co„insured€or€additional€insured€on€Mid„SouthððsÏliability€insurance€policy€which€was€in€effect€on€the€date€of€Jordanððs€accident.€€InÏgranting€Besamððs€motion€for€summary€judgment€on€its€cross„claim€against€Mid„South,Ïthe€trial€court€ordered€Mid„South€to€defend€Besam€in€the€underlying€action,€orderedÍMid„South€to€reimburse€Besam€for€all€attorneysðð€fees€and€litigation€costs€incurred€byÏBesam€in€its€defense€of€this€case€up€to€the€date€of€the€order,€ordered€Mid„South€to€payÏany€judgment€entered€against€Besam€in€favor€of€the€Plaintiff€to€the€same€extent€thatÏBesam€would€have€been€covered€for€the€judgment€under€the€liability€insurance€policyÏin€effect€at€the€time€of€Plaintiffððs€accident€had€Besam€been€named€as€a€co„insured€orÏadditional€insured€under€the€policy,€unless€Besam€is€adjudged€solely€liable€forÏPlaintiffððs€alleged€damages€and€injuries,€and€designated€its€order€as€a€final€judgmentÏpursuant€to€Tenn.€R.€Civ.€P.€54.02.€€Mid„South€appeals€the€judgment€of€the€trial€courtÏarguing€that€the€trial€court€erred€in€granting€Besamððs€motion€for€summary€judgment€onÏits€cross„claim€against€Mid„South.€€For€the€reasons€stated€hereafter,€we€reverse›€theÏjudgment€of€the€trial€œcourt€and€remand€for€a€determination€of€whether€Besam€is€directlyÏand€solely€liable€for€the€claims€asserted€by€the€Plaintiff.›ÌœÌ›à@ àò òFACTSó óÌà àMid„South,€a€distributor€of€automatic€doors,€entered€into€a€distributorshipÏagreement€with€Besam,€a€manufacturer€of€automatic€doors,€whereby€Mid„SouthÏagreed€to€provide€Besam€with€liability€insurance€for€all€claims€for€which€Besam€wasÏnotœ€directly€and€solely€liable.›€€Mid„Southððs€distributorship€agreement€with€BesamÏprovides€in€pertinent€part€as€follows:ÌÓÓà8 àœ6.›à8 àòò[Mid„Southððs]€Sales,€Service€and€Reporting€ObligationsÌÌà8 àóóà8 àœà8 à[Mid„South]›€shall,€to€the€reasonableÏsatisfaction€of€[Besam]:ÌÌà8 àà8 àœG.›à8 àObtain€and€maintain€liability€insurance€namingÏ[Besam]€as€co„insured€in€such€reasonableÍamounts€as€may€be€agreed€upon€by€theÏparties€and€protecting€[Besam]€from€anyÏworkmanððs€compensation€or€other€claim€forÏwhich€[Besam]€is€not€directly€and€solely€liableÏhereunder.Ì€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€*€€€€€€€€€€€€€€€*€€€€€€€€€€€€€€€*Ìà8 à11.à8 àòòGeneralóóÌÌà8 àà8 àG.à8 àThe€construction€and€performance€of€thisÏAgreement€and€the€rights€and€remedies€of€theÏparties€hereto€shall€be€governed€by€the€law€ofÏthe€State€of€New€Jersey.ÌòòÌóóÌÌœ›ÓÓà àMid„South€failed€to€have€Besam€named€as€a€co„insured€on€Mid„Southððs€policyÏof€œliability›€insurance€for€the€1989„1990€year.ÌÌà àOn€July€26,€1990,œ€Jordan€sustained›€injuries€at€a€Kroger€store€when€anÏautomatic€door€closed€on€her.€ÌÌà àà@ àò òLAWó óÌà àThe€sole€issue€presented€for€review€is€as€follows:Ìà àWhether€the€trial€court€erred€in€granting€Besamððs€motion€for€summary€judgmentÏon€its€cross„claim€against€œMid„South.ÌÌà àThe€standards€governing€our€review€of€a€trial€courtððs€action€on€a€motion€forÏsummary€judgment€are€well€settled.€€Since€our€inquiry€involves€purely€a€question€ofÏlaw,€no€presumption€of€correctness€attaches€to€the€trial€courtððs€judgment,€and€our€taskÏis€confined€to€reviewing€the€record€to€determine€whether€the€requirements€of€Rule€56Íof€the€Tennessee€Rules€of€Civil€Procedure€have€been€met.€€òòCarvell€v.€Bottomsóó,€900ÏS.W.2d€23,€26€(Tenn.€1995);€òòCowden€v.€Sovran€Bank/Central€Southóó,€816€S.W.2d€741,Ï744€(Tenn.€1991);€òò€Foley€v.€St.€Thomas€Hosp.óó,€906€S.W.2d€448,€452€(Tenn.€Ct.€App.Ï1995);€òòBrenner€v.€Textron€Aerostructures,€A€Division€of€Textron,€Inc.óó,€874€S.W.2d€579,Ï582€(Tenn.€Ct.€App.€1993).€€Tennessee€Rule€of€Civil€Procedure€56.03€provides€thatÏsummary€judgment€is€appropriate€only€where:€(1)€there€is€no€genuine€issue€of€materialÏfact€relevant€to€the€claim€or€defense€contained€in€the€motion,€and€(2)€the€moving€partyÏis€entitled€to€a€judgment€as€a€matter€of€law€on€the€undisputed€facts.€€òòCarvellóó,€900ÏS.W.2d€at€26;€òòByrd€v.€Hallóó,€847€S.W.2d€208,€210€(Tenn.€1993);€òòAnderson€v.€StandardÏRegister€Co.óó,€857€S.W.2d€555,€559€(Tenn.€1993).€€The€moving€party€has€the€burden€ofÏproving€that€the€motion€satisfies€these€requirements.€€òòDownen€v.€Allstate€Ins.€Co.óó,€811ÏS.W.2d€523,€524€(Tenn.€1991).ÌÌà àWhile€the€summary€judgment€procedure€is€not€a€substitute€for€trial,€it€goes€to€theÏmerits€of€the€complaint€and€should€not€be€taken€lightly.€€òòByrdóó,€847€S.W.2d€at€210;ÏòòJones€v.€Home€Indem.€Ins.€Co.óó,€651€S.W.2d€213,€214€(Tenn.€1983);€òòFowler€v.€HappyÏGoodman€Familyóó,€575€S.W.2d€496,€498€(Tenn.€1978);€òòFoleyóó,€906€S.W.2d€at€452.€€It€hasÏbeen€repeatedly€stated€by€the€appellate€courts€of€this€state€that€the€purpose€of€aÏsummary€judgment€proceeding€is€not€the€finding€of€facts,€the€resolution€of€disputedÏfactual€issues€or€the€determination€of€conflicting€inferences€reasonably€to€be€drawnÏfrom€the€facts.€€òòBellamy€v.€Federal€Express€Corp.óó,€749€S.W.2d€31,€33€(Tenn.€1988).€€ÏRather,€the€purpose€of€summary€judgment€is€to€resolve€controlling€issues€of€law.€€òòIdóó.€€ÌÌà àIn€evaluating€the€propriety€of€a€motion€for€summary€judgment,€we€view€theÏevidence€in€the€light€most€favorable€to€the€nonmoving€party€and€draw€all€reasonableÏinferences€in€the€nonmoving€partyððs€favor.€€òòByrdóó,€847€S.W.2d€at€210„11.€€A€motion€forÏsummary€judgment€should€be€granted€only€when€both€the€facts€and€the€conclusionsÏdrawn€from€the€facts€permit€a€reasonable€person€to€reach€but€one€conclusion.€€òòIdóó.€ÌÌ›à àBecause€the€parties€agreed€in€the€distributorship€agreement€that€New€JerseyÏlaw€would€apply€in€the€construction€and€performance€of€the€agreement€and€inÏassessing€œthe€€partiesðð›€rights€and€œremedies,›€we€will€apply€New€Jersey€law€to€the€factsÏof€this€case.ÌÌà àOne€who€enters€into€an€agreement€to€obtain€insurance€and€neglects€to€fulfill€hisÏobligation€becomes€himself€an€insurer€and€is€liable€as€such.€€òòDiPietro€v.€City€ofóóÏòòPhiladelphiaóó,€496€A.2d€407,€409€(Pa.€Super.€Ct.€œ1985).›€€€As€a€general€rule,€the€insurerÏis€obligated€to€defend€an€action€whenever€a€complaint€alleges€a€basis€of€liability€withinÏthe€insuredððs€liability€coverage.€€òòBurd€v.€Sussex€Mut.€Ins.€Co.óó,€267€A.2d€7,€9€(N.J.Ï1970).€€One€purpose€of€a€liability€insurance€policy€is€to€have€the€insurer€defend€suitsÏinvolving€claims€which€the€insurer€would€have€to€pay€if€the€claimant€prevailed€in€theÏaction.€€òòIdóó.€at€10.€€The€covenant€to€defend€is€thus€identified€with€the€covenant€to€pay.€ÏòòIdóó.€€ÌÌà àThe€obligation€to€defend€ð ðgroundless,€false€or€fraudulentðð€claims€does€not€meanÏthat€the€insurer€is€obligated€to€defend€claims€which€are€beyond€the€insuredððs€liabilityÍcoverage.€€òòIdóó.€€The€obligation€to€defend€means€merely€that€an€insurer€cannot€refuse€toÏdefend€a€suit€on€the€ground€that€the€claim€asserted€against€the€insured€cannotÏpossibly€succeed€because€either€in€law€or€fact€there€is€no€basis€for€a€plaintiffððsÏjudgment.€€òòIdóó.€€€In€sum,€an€insurerððs€promise€to€pay€claims€within€the€scope€of€œan›Ïinsuredððs€liability€insurance€policy€€encompasses€the€obligation€to€defend€thoseÏclaims.€€òòIdóó.€€ÌÌà àIf€the€circumstances€are€such€that€the€scope€of€coverage€and€the€correlativeÏduty€to€defend€may€not€be€resolved€until€factual€matters€surrounding€the€claim€haveÏbeen€determined€at€trial,€the€obligation€to€furnish€a€defense€is€transformed€to€one€ofÏreimbursement€to€the€insured.€€òòCooper€œLab.›€v.€œIntððl›€Surplus€Linesóó,€802€F.2d€667,€675Ï(3rd€Cir.€1986);€òòSee€alsoóó€òòBurdóó,€267€A.2d€at€9„10.ÌÌà àIn€the€present€case,€œthe€trial€court€may€find€Besam›€to€œbe›€œdirectly€and€solelyÏliable€for€Plaintiffððs€injuries.€€Thus,€as€Mid„South€has€argued,€the›€possibility€exists€thatÏPlaintiffððs€œclaim€might›€œnot€be›€covered€by€the€insurance€required€by€the€partiesððÏdistributorship€agreement.€€œTherefore,€because›€Mid„Southððs€obligation€to€defendÏœclaims€which€would€have€been€covered€by€the€insurance€required€by€the€partiesððÏdistributorship€agreement›€does€not€include€an€obligation€to€defend€claims€beyond€theÏreach€œof€insurance€coverage€required€by€›the€partiesðð€agreement,€the€trial€courtððs€grantÏof€summary€judgment€in€favor€of€Besam€on€Besamððs€cross„claim€against€Mid„South€isÏpremature.€€Mid„Southððs€corresponding€obligation€to€defend€and€duty€to€pay€the€claimsÏassessed€against€Besam€does€not€arise€until€after€the€trial€court€determines€whetherÍBesam€is€directly€and€solely€liable€for€the€claims€asserted€by€the€Plaintiff.€€We,Ïtherefore,€reverse€the€trial€courtððs€order€granting€summary€judgment€in€favor€of€BesamÏon€its€cross„claim€against€Mid„South€and€remand€for€a€determination€of€whetherÏBesam€is€directly€and€solely€liable€for€the€claims€asserted€by€the€Plaintiff.€€€ÌÌà àThe€judgment€of€the€trial€court€is€hereby€reversed€and€remanded€for€aÏdetermination€of€whether€Besam€is€directly€and€solely€liable€for€the€claims€asserted€byÏthe€Plaintiff.€€Costs€on€appeal€are€taxed€œto›€œBesam›€for€which€execution€may€issue€ifÏœnecessary.ÌÌÌÓÓà àà àà àà àà àà àà àà àòò€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€Ïóóà àà àà àà àà àà àà àà àHIGHERS,€J.ÌÌÌÌCONCUR:ÌÌÌÌòò€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€ÌóóCRAWFORD,€P.J.,€W.S.ÌÌÌÌòò€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€óóÌFARMER,€J.›