Whether the insurer can escape the duty to defend based on allegations in its complaint for declaratory relief was the issue in General Ins. Co. of Am. v. Clark Mall Corp., 2010 U.S. Dist. LEXIS 74880 (N.D. Ill. July 26, 2010).

   The underlying plaintiffs lost property in a fire at a mall owned by the insureds.  The insurer denied coverage after determining the property was in the "care, custody, or control" of the insureds at the time of loss.  The original decision determined that since the pleadings in the underlying case did not show the "care, custody, or control" exclusion was clearly applicable, the insurer had a duty to defend.  Therefore, the insured's motion for judgment on the pleadings was granted.  The insurer now sought reconsideration.

   The court was unpersuaded.  The insurer never offered any "evidence" in opposition to the motion for judgment on the pleadings.  Instead, it relied on the pleadings in the underlying complaint and its own allegations in its declaratory judgment complaint to argue that the "care, custody and control" exclusion applied.  But the allegations in the insured's complaint were not "evidence." 

   In Illinois, the courts look beyond the allegations of the underlying complaint, but they do so to consider evidence, not allegations of the insurer's declaration judgment complaint.  Here, the insurer refused to even represent that it had such evidence, despite an exhaustive investigation of the fire and the insureds' possible involvement, as claimed in the declaratory judgment complaint.  Therefore, the insurer's motion for reconsideration was denied.