Universal Protection Service, LP D/B/A Allied Universal Security and Universal Protection Service GP, Inc. v. the Woodlands Mall Associates, LLC

In The

Court of Appeals

Ninth District of Texas at Beaumont

________________

NO. 09-24-00064-CV
________________

UNIVERSAL PROTECTION SERVICE, LP D/B/A ALLIED UNIVERSAL
SECURITY AND UNIVERSAL PROTECTION SERVICE GP, INC.,
Appellants

V.

THE WOODLANDS MALL ASSOCIATES, LLC, Appellee
________________________________________________________________________

On Appeal from the 284th District Court
Montgomery County, Texas
Trial Cause No. 21-05-06367-CV
________________________________________________________________________

MEMORANDUM OPINION

Universal Protection Services, LP d/b/a Allied Universal Security and

Universal Protection Service GP, Inc. (collectively, “Allied”) and The Woodlands

Mall Associates, LLC (“TWM”) were parties to a Security Agreement (“the

Agreement”) whereby Allied would provide security services for TWM. Allied and

TWM filed competing motions for summary judgment, and the trial court granted

summary judgment for TWM. Allied appeals the trial court’s Final Judgment, and

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asks: in issues one and two whether the trial court incorrectly interpreted the

provision requiring it to defend TWM; in issue three, whether TWM was entitled to

summary judgment on the ground that Allied breached the Agreement by not

procuring insurance; in issue four whether we should reverse the monetary awards

to TWM where Allied had no duty to defend; and in issue five, whether we should

render judgment for Allied on the duty-to-defend issue and remand the case for an

award of reasonable expenses, attorney’s fees, and costs. Analyzing issues one and

two, we hold the trial court correctly interpreted the contractual provision as

requiring Allied to defend TWM. Since this determination is dispositive of Allied’s

remaining issues, we need not reach issues three through five. See Tex. R. App. P.

47.1. We affirm the trial court’s judgment for the reasons discussed below.

BACKGROUND

Following a robbery in the mall parking lot, a patron, Penny Prater, sued

Allied and TWM, along with Dillard’s Inc., Dillard Texas East, LLC, and Dillard’s

Properties, Inc. (collectively, “Dillard’s”). 1 In her Original Petition and in her

current live pleading, Prater describes leaving Dillard’s in the mall and being

attacked in the parking lot on her way back to her car. She also alleges, “There were

no security guards present at the time of the attack[,]” and she “was forced to stumble

back inside Dillard’s to seek emergency assistance.” Prater claims that all

1
Dillard’s is not a party to this appeal.
2
“Defendants failed to train their employees and staff in the most basic security

procedures[]” and to “train their employees and other staff to monitor security

cameras present on the premises, to recognize known indications of potential

criminal activity, to deter criminal activity and timely report perceived criminal

activity.” She also alleges the Defendants “lacked adequate security policies and

protocols” and “failed to appropriately employ or otherwise provide appropriately

trained security personnel[.]”

Prater pleaded a negligence cause of action against all Defendants and asserts

that Defendants negligently hired, trained, directed, supervised, and retained their

employees. She claims Defendants failed to provide adequate security and failed “to

formulate, have, and/or enforce adequate policies and procedures to prevent and/or

deter criminal conduct at the Mall.” Prater also pleaded a premises liability claim as

to TWM and Dillard’s. In support of the premises liability claim, among other things,

she alleges that Dillard’s and TWM failed to use ordinary care to protect her from

the robber’s criminal acts, failed “to exercise ordinary care to make the premises

safe,” and failed “to properly and safely maintain the premises.”

The Agreement between Allied and TWM states that “Owner wishes to

contract for security services at The Woodlands Mall[,]” and “Contractor provides

security services and desires to provide security services at the Property pursuant to

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the terms and conditions of this Agreement.” The Agreement outlines Allied’s

responsibilities as follows:

3. On-Site Contracted Service.

A. Engagement of Services. Owner hereby engages Contractor
to provide security services in accordance with the terms of this
Agreement (“Services”), which may be amended from time to
time by the written agreement of the parties. This is a non-
exclusive Agreement, Owner retains the right to use other
providers of security services at any of the properties owned or
managed by its affiliates.

B. Security functions. Contractor personnel assigned to the
Property shall be responsible for promoting a pleasant shopping
atmosphere and crime prevention efforts through patrol of the
Property; seeking out and providing appropriate customer
service to patrons; report any known safety hazards and
enforcement of the Property’s rules and regulations; appropriate
response to incidents and emergencies; preliminary investigation
and appropriate disposition of incidents; access control/physical
security as appropriate during operating and non-operating
hours; official reporting of activities, incidents, and inspection
logs; and any special assignments and/or events related to the
security/safety function of the Property as agreed upon by the
parties. For the avoidance of doubt, “known” here is intended to
refer to those types of safety hazards that Contractor in the
normal exercise of its obligations under this Agreement would
discover.
...

E. On-Site Personnel.
1. Security Staff. Contractor shall provide a stable staff
that is trained and capable of providing the Services.
Subject to the specific staffing requirements outlined in
Exhibit A, Contractor will provide an on-site security
manager (“Security Manager”), assistant security

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manager, supervisors, CCTV operators/dispatchers,
security officers, and police officers, as applicable. The
staff will be a combination of full-time and part-time
employees in order to satisfy the specific deployment
needs of the Property and maintain flexibility in
scheduling.

...
J. Training.

1. Officer Training. Contractor shall promote and provide
a trained and capable security staff. Contractor shall
develop and deliver training courses as set forth on the
attached Exhibit B to all security officers. Additionally,
Contractor will deliver any State or Federally
mandated training that is not included in Exhibit B.
Owner may expand the training requirements as
business needs dictate during the Term, in its sole
discretion.
2. Certification Training. Training that requires
certification may be acquired through a professionally
recognized third party training system or an equivalent
program developed by Contractor. Contractor is
responsible for maintaining all required certifications.

...

8. Insurance and Indemnification

Contractor agrees to furnish and keep in force the following
insurance for the Term:

...

b. Liability Insurance. Commercial General Liability Insurance
with limits of Five Million Dollars ($5,000,000.00) per
occurrence and aggregate applying on a “per location basis”
which shall contain coverage for bodily injury, property damage,
premises operations, completed operations, contractual liability

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and contingent liability naming Owner and such other entities as
Owner shall reasonably require from time to time as additional
insureds. The foregoing insurance limits may be satisfied by any
combination of primary and excess coverage.

Central to the parties’ dispute is Provision 8(e) of the Agreement, which states:

Indemnification. Contractor agrees that it shall defend, indemnify, and
hold harmless Owner, its respective direct and indirect parents and
subsidiaries, any of its affiliated entities, successors and assigns and any
current or future officer, director, employee, partner, member or agent
of any of them (“Indemnitees”) and the agents, officers and employees
of all of the Indemnitees from and against any claims, liabilities, losses,
damages, actions, causes of action, or suits to the extent caused by (A)
any actual or alleged negligent or grossly negligent act or omission or
willful misconduct of Contractor or its agents or employees at the
Property or in connection with this Agreement or breach thereof in any
way, (B) Contractor’s failure to purchase and maintain all insurance
required by this Agreement and (C) negligence or willful misconduct
of Contractor or its agents or employees in any operation of a Security
Vehicle under this Agreement. It is intended that all claims and
demands, legal proceedings and lawsuits in which any party to this
Agreement or additional insured under this Agreement is named or
described as a defendant which alleges or describes any claim in which
Contractor or a security officer has done or has failed to do any act or
thing required pursuant to this Agreement or failed to provide the
Services at the Property shall be a claim tendered to, accepted by or
defended by Contractor. Owner shall within thirty (30) days after notice
of any incident, potential claim or suit, or service of legal process,
provide Contractor, at 1551 N Tustin Ave., Suite 650, Santa Ana, CA
92705 to the attention of Risk Department with written notice that an
action has been brought and shall require Contractor, at its own expense,
to employ such attorneys as Contractor may see fit to employ, and as
reasonably approved by Owner’s Director of Risk Management, to
defend such claim or action on behalf of the Indemnitees. If a tender of
defense and/or indemnity is refused by Contractor or its insurer, or if a
defense is provided under any reservation of rights and Owner does not
consent to such refusal or reservation of rights, Contractor shall pay
liquidated damages in the sum of $2,000.00 to Owner for the amount
of the added internal expense incurred by the Indemnitees in dealing
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with the claim or action for which tender was refused or rights reserved.
This liquidated damages provision shall be in addition to the
Indemnitees’ actual costs of defense, investigation, litigation, litigation
management expenses for in-house counsel, costs of trial and/or
settlement of the claim which are incurred by the Indemnitees which
shall be billed to Contractor as incurred until the tender is accepted
without reservation. The provisions of this paragraph shall survive the
termination or expiration of this Agreement and shall not be construed
to provide for any indemnification which would, as a result thereof,
make the provisions of this paragraph void or to reduce or eliminate any
other indemnification or right which the indemnified parties have by
law.

The Agreement further provides in Paragraph L, “Attorney’s Fees. If either party

shall institute any action or proceeding against the other relating to the provisions of

this Agreement, the unsuccessful party in the action or proceeding shall reimburse

the prevailing party for all reasonable expenses and attorneys’ fees and

disbursements.”

Based on the Agreement, TWM tendered its request for defense to Allied

through two letters. Allied refused to defend TWM, so TWM filed a cross-claim

against Allied for contribution and indemnity, breach of contract, and negligence.

TWM also sought its attorney’s fees.

A jury determined that the criminal actors who robbed Prater were solely

responsible and found no negligence by any defendant. Before trial, the parties

agreed to bifurcate and have a separate trial on TWM’s cross-claim against Allied

based on the contractual duty to defend. Given the jury’s finding of no liability, the

trial court ultimately determined that TWM’s contribution and indemnity claim and
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negligence claim against Allied were not viable. At issue in this appeal are the parties’

competing motions for judgment based solely on the contractual duty to defend.

MOTIONS FOR SUMMARY JUDGMENT

Cross-Defendant [Allied’s] Motion for Summary Judgment

On January 24, 2024, Allied filed its Motion for Summary judgment. Allied

supported its Motion for Summary Judgment with the following evidence: Prater’s

Original Petition; Prater’s First Amended Original Petition; Prater’s Second

Amended Original Petition; Security Agreement between Allied and TWM; Charge

of Court with Jury’s Answers; and Affidavit of Mark Lapidus regarding attorney’s

fees.

In its Motion for Summary Judgment, Allied contends that because the jury

found that no defendants, including Allied and TWM, were negligent, there were no

available claims for contribution or indemnity. Additionally, Allied argues it had no

contractual duty to defend TWM, because: (1) Prater asserted independent acts of

negligence and premises liability against TWM; (2) Prater did not assert claims of

vicarious liability or negligent supervision claims against TWM for Allied’s acts or

conduct; and (3) the jury found no liability on the part of Allied. Allied further claims,

“Since the contract only required Allied to defend TWM if Allied (and not TWM)

was negligent or breached the contract, no duty to defend was owed.”

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Allied notes that per the Agreement, Illinois law governs, and under Illinois

law, Allied had no duty to defend or indemnify TWM and cites a portion of the

Indemnification provision. Allied asserts that TWM brought claims for (1)

contribution and indemnity under Texas Civil Practice and Remedies Code Chapter

32, (2) breach of contract, and (3) negligence, and given the jury’s findings, the

contribution and indemnity and negligence claims fail as a matter of law. As relevant

to the duty to defend, Allied argues that in its cross-claim, TWM pleads that

“[Allied] has contractual obligations to defend and indemnify Defendant/Cross-

Plaintiff’s allegations pursuant to the terms of the March 1, 2019, contract. [Allied]

has refused to defend and indemnify Defendant/Cross-Plaintiff, and this refusal

constitutes a material breach of the Agreement.”

Allied asserts that under Illinois law, there is no duty to indemnify or defend

one against his own negligence “unless such a construction is required by clear and

explicit language in the contract or such intention is expressed in unequivocal terms.”

According to Allied, under the Agreement, this is “only ‘to the extent caused by’

any actual or alleged negligent conduct of [Allied] or its agents or employees.”

Therefore, Allied argues, based on Illinois law and the Agreement’s limiting

language, the defense obligation does not extend to the “indemnitee’s own

negligence or conduct.” Additionally, Allied attempts to distinguish case law where

courts determined indemnity and defense were owed by arguing those cases

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involved broader contract language and that there are no claims of vicarious liability

here. Further, it contends that the duty to defend TWM is predicated on negligence

by Allied, and so the jury’s finding that there was no negligence meant there was no

duty to defend.

Finally, Allied argues that if it is successful in defending against TWM’s

breach of contract claim, then it is entitled to attorney’s fees. In support of this

argument, it points to the contract language and Lapidus’s affidavit.

Cross-Plaintiff [TWM’s] Traditional Motion for Summary Judgment

TWM also filed a Traditional Motion for Summary Judgment based on the

Agreement. In support of its Motion for Summary Judgment, TWM attached the

following evidence: Brookfield-Allied Security Agreement; Prater’s Petitions;

2/16/21 Tender Correspondence to Allied; 5/13/21 Tender Correspondence to

Allied; and Maron Marvel Invoices for Legal Services.

In its Motion, TWM argues, “Allied agreed to provide a defense for TWM in

cases where there are allegations of negligent acts or omissions attributed to Allied

within the scope of the Allied – TWM Security Agreement[.]” TWM asserts that it

provided Allied with notice of Prater’s allegations against Allied twice. Yet, Allied

refused to defend TWM, which “amounted to a breach of contract.” TWM claims

that Allied’s breach of contract harmed TWM, because TWM incurred reasonable

and necessary litigation costs defending against Prater’s allegations. According to

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TWM, it “is entitled to recover its attorney fees from Allied as well as judgment in

TWM’s favor finding that Allied owes a duty to defend and to indemnify TWM from

any liability alleged against TWM in this matter pursuant to the Allied – TWM

Security Agreement.” TWM then sets forth the facts supporting the breach of

contract claim.

TWM characterizes the only two questions before the trial court as: “1)

whether Allied had a duty to defend and indemnify TWM directly and through the

procurement of required insurance; and 2) if there was a duty to defend, indemnify,

and procure insurance, whether Allied has breached its duty to defend and to procure

insurance to protect TWM.” TWM contends that Allied had a duty to defend and

indemnify TWM and cites to the plain language in the Agreement. Further, TWM

asserts that the Agreement’s language “indicates that Allied had a duty to defend

TWM that was separate and independent of Allied’s duty to indemnify” and cites

Illinois law in support of this. TWM argues that Allied’s receipt of notice of Prater’s

Original Petition triggered its duty to defend TWM. According to TWM, “There is

no public policy in the state of Illinois against contracts that seek to allocate business

risks as specified in the Allied-TWM Agreement.” TWM argues that Allied

breached its duty to defend without a good-faith basis.

Alternatively, TWM contends that Allied breached the Agreement by failing

to procure the required insurance that would have provided for TWM’s defense and

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indemnity. Finally, TWM claims it is entitled to reasonable and necessary attorney’s

fees under the Agreement.

Cross-Defendant [Allied’s] Response in Opposition to Cross-Plaintiff’s Motion
for Summary Judgment

On January 18, 2024, Allied filed its Response in Opposition to Cross-

Plaintiff’s Motion for Summary judgment. In support of its Response, Allied

attached: the Affidavit of Mark Lapidus; Allied’s Formal Tender Denial Letter; and

TWM’s First Supplemental Required Initial Disclosures.

In its response, Allied again argues the Agreement’s language is not broad

enough that it should have to defend and indemnify TWM for acts of TWM’s own

negligence, which were alleged here. Allied then attempts to distinguish Illinois case

law cited by TWM in its Motion for Summary Judgment. Regarding TWM’s

allegation that the failure to name TWM as an additional insured constituted a breach

of the Agreement, Allied responds that TWM’s live pleading does not contain such

a claim. Therefore, Allied objects to any claim that it failed to procure insurance as

constituting a breach and contends the trial court should not consider any claim.

Cross-Plaintiff [TWM’s] Reply to [Allied’s] Motion for Summary Judgment

The same day that Allied filed its Response in Opposition, TWM filed its

Reply to Allied’s Motion for Summary Judgment. In its Reply, TWM differentiates

between the duty to defend and the duty to indemnify and claims it is only seeking

relief for Allied’s failure to defend. TWM asserts that Allied had no good-faith basis
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for its refusal to defend. TWM further argues the following: (1) under Illinois law,

an indemnitor was found to have a duty to defend even though the only indemnitee

was named as a defendant/alleged tortfeasor; (2) under Illinois law, the duty to

indemnify is recognized as a separate duty than the duty to defend; (3) based on

Prater’s Petitions and the Agreement, Allied had no good-faith basis for its refusal

to defend; and (4) the factual allegations in Prater’s petitions amount to an allegation

that Allied’s negligence was the but for cause of her injuries.

Trial Court’s Final Judgment

On January 21, 2024, the trial court signed its Final Judgment. In the Final

Judgment, the trial court notes that given the jury’s findings of no liability on the

part of any Defendants, TWM’s Chapter 32 claims for contribution and indemnity

and its negligence claims “fail as a matter of law.” The trial court adds that the only

remaining claim is the breach of contract claim and that the Agreement contains a

choice of law provision calling for the application of Illinois law. The trial court

states that Illinois law is “virtually identical to Texas law on contract interpretation[,]”

so the choice of law provision “does not make much of a difference in the Court’s

analysis.” The trial court’s judgment cites a portion of the indemnity provision and

the elements for a breach of contract claim under Illinois law, which are the same as

in Texas.

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The trial court reasons that it was undisputed: Allied and TWM entered into

the Agreement; TWM performed by paying for services and tendering the requisite

demand required by the Agreement; Allied refused to defend; and TWM suffered

monetary injury by having to provide its own defense. Thus, the trial court

characterizes the only question before it as whether Allied had a duty to defend under

the Agreement’s express terms. The trial court also expressly states that although

there was an issue of whether Allied maintained the proper insurance and named

TWM as an additional insured, “it is of no moment” and “did not cause the damage

TWM alleges and seeks here.”

The trial court describes Prater’s claims against all the Defendants as follows:

Defendants failed to appropriately train their employees and other staff
to monitor security cameras present on the premises, to recognize
known indications of potential criminal activity, to deter criminal
activity and timely report perceived criminal activity; Defendants
lacked adequate security policies and protocols based on industry best
practices; Defendants failed to appropriately employ or otherwise
provide appropriately trained security personnel to deter criminal
activity, interrupt criminal activity as it occurred, or appropriately
respond to criminal activity at the Mall and/or Dillard’s; and, of greatest
import here, Plaintiff specifically alleged that Defendants breached
their duties to her by negligently hiring, training, retaining, supervising,
and directing their employees, as well as by failing to provide adequate
and proper security and by failing to formulate, have, and/or enforce
adequate policies and procedures to prevent and/or deter criminal
conduct at the Mall.

The trial court then concluded that the Agreement “very clearly puts the

responsibility of all of these items on Allied[,]” except possibly the premises liability

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claim, and the Agreement’s express language “makes it clear that Allied should have

defended TWM, despite the jury finding no merit in Plaintiff’s claims.” The trial

court also differentiates between the duty to indemnify and duty to defend. The trial

court responds to Allied’s argument that under Illinois law, and while an

indemnification agreement cannot be construed as indemnifying a party against its

own negligence unless such construction “is required by clear and explicit language

in the contract or such intention is expressed in unequivocal terms,” that does not

apply to the duty to defend.

The trial court then granted TWM’s Motion for Summary Judgment and

denied Allied’s Motion for Summary Judgment. The trial court awarded TWM

$72,246.80 in attorney’s fees incurred for the defense and litigation expenses plus

prejudgment interest, contingent attorney’s fees if Allied unsuccessfully appeals,

and post-judgment interest. Allied timely appealed.

ISSUES ONE AND TWO:
CONTRACT INTERPRETATION AND DUTY TO DEFEND

In issue one, Allied asks whether the first part of the Indemnification

Provision required it to defend TWM, where it furnishes TWM a defense against

claims caused by Allied’s acts or omissions and the underlying plaintiff did not

allege TWM is liable for any of Allied’s acts or omissions. In issue two, Allied asks

whether the second part of the Indemnification Provision required it to defend TWM

where “(a) nothing in that part gives Allied a duty to defend; (b) by its plain language,
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that part sets out what kinds of claims are eligible for tender and when the obligation

to defend is invoked; and (c) to construe that part to require Allied to defend TWM

would render a portion of the first part of the Provision superfluous.” TWM responds

that when reviewing the indemnity paragraph “in light of the contractual whole,

Allied owed TWM a duty to defend.”

Standard of Review and Applicable Law

Here, the Agreement contained a choice-of-law provision stating that Illinois

law applies, which the parties do not dispute. When applying a contractual choice-

of-law provision, we apply the substantive law of the choice-of-law provision but

apply Texas law to procedural matters, including the standards of review. See

Autonation Direct.com, Inc. v. Thomas A. Moorehead, Inc., 278 S.W.3d 470, 472

(Tex. App.—Houston [14th Dist.] 2009, no pet.) (explaining the substantive law of

the chosen state may apply, we apply our own law to matters of remedy and

procedure, including standards of review); see also Credit Suisse AG v. Claymore

Holdings, LLC, 610 S.W.3d 808, 819 n.12 (Tex. 2020) (citation omitted) (noting

same). We will apply Illinois contract interpretation principles, but we will employ

the standard of review provided by Texas precedent. See Credit Suisse AG, 610

S.W.3d at 819 n.12; Thomas A. Moorehead, Inc., 278 S.W.3d at 472.

We review a trial court’s decision on a motion for summary judgment de

novo. See Wal-Mart Stores, Inc. v. Xerox State Loc. Sols., Inc., 663 S.W.3d 569, 576

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(Tex. 2023). When the parties file competing motions for summary judgment, and

the trial court grants one and denies the other, we review all questions presented and

render the judgment that the trial court should have rendered. See HCBeck, Ltd. v.

Rice, 284 S.W.3d 349, 352 (Tex. 2009) (citing Tex. Workers’ Comp. Comm’n v.

Patient Advocates of Tex., 136 S.W.3d 643, 648 (Tex. 2004)). In reviewing all

questions presented, we examine the parties’ summary judgment evidence. Mann

Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009).

We review the evidence in the light most favorable to the non-movant and party

against whom the summary judgment was rendered. See id.; City of Keller v. Wilson,

168 S.W.3d 802, 807, 827 (Tex. 2005). “A traditional summary-judgment movant

will prevail only by establishing that no material fact issue exists and it is entitled to

judgment as a matter of law.” Point Energy Partners Permian, LLC v. MRC Permian

Co., 669 S.W.3d 796, 804 (Tex. 2023) (citations omitted); see Tex. R. Civ. P.

166a(c). If the movant meets his burden, “the burden then shifts to the non-movant

to disprove or raise an issue of fact as to at least one of those elements.” Amedisys,

Inc. v. Kingwood Home Health Care, LLC, 437 S.W.3d 507, 511 (Tex. 2014). If the

movant does not meet its burden, “the burden does not shift, and the non-movant

need not respond or present any evidence.” Id. To be entitled to summary judgment

on an affirmative defense, a defendant must plead and conclusively establish each

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element of its defense as a matter of law. Johnson & Johnson Med., Inc. v. Sanchez,

924 S.W.2d 925, 927 (Tex. 1996).

Illinois law provides that “[t]he interpretation of a contract is a question of

law and therefore may be decided on a motion for summary judgment.” Joyce v.

Mastri, 371 Ill. App. 3d 64, 74, 308 Ill. Dec. 537, 861 N.E.2d 1102 (2007) (citation

omitted). When interpreting a contract, we “consider the entire document to give

effect to the parties’ intent, as determined by the plain and ordinary meaning of the

language of the contract.” Id. (citation omitted). To ascertain this intent, “the various

contract provisions must be viewed as a whole.” Lempa v. Finkel, 278 Ill. App. 3d

417, 428, 215 Ill. Dec. 408, 663 N.E.2d 158 (1996) (citations omitted). “Words

derive meaning from their context, and contracts must be viewed as a whole by

examining each part in light of the other parts.” Id. (citations omitted). Courts do not

reject contract language as meaningless or surplusage, and they presume that a

contract’s terms and provisions “are purposely inserted and that the language was

not employed idly.” Id.

The Illinois Supreme Court has cautioned that it “‘serves no useful purpose to

attempt to analyze or reconcile the numerous cases interpreting indemnity clauses’

since each individual case ‘depends upon the particular language used and the factual

setting of the case.’” Buenz v. Frontline Transp. Co., 227 Ill. 2d 302, 310–11, 317

Ill. Dec. 645, 882 N.E.2d 525 (2008) (citing Zadak v. Cannon, 59 Ill.2d 118, 121,

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319 N.E.2d 469 (1974)); see also Wilda v. JLG Indus., Inc., 470 F. Supp. 3d 770,

784 (N.D. Ill. 2020) (citations omitted) (discussing Illinois law). In Buenz, the

Illinois Supreme Court explained, “It is not simply the use of the phrase ‘any and all’

that determines whether a particular contract provides indemnification for an

indemnitee’s own negligence. The phrase must be read in the context of the entire

contract.” See Buenz, 227 Ill. 2d at 316, 317 Ill. Dec. at 653, 882 N.E.2d at 533. It

noted that decisions resulting in no indemnification for the indemnitee’s own

negligence arose from contracts which “contained express clauses limiting

indemnification to negligence occasioned by the indemnitor.” Id. at 315–16, 317 Ill.

Dec. at 653, 882 N.E.2d at 533. The court reasoned that for agreements containing

such limiting language, “courts will not strain, simply because the contract also

contains ‘any and all’ language, to read into that contract indemnification for an

indemnitee’s own negligence.” Id. The court disavowed the proposition that its

reasoning implied that “the inclusion of the phrase ‘any and all’ within an

indemnification clause is insufficient to indemnify an indemnitee for its own

negligence.” Id. Ultimately, the court in Buenz determined that “any and all claims”

absent any limiting language led the court to conclude that the agreement “clearly

and explicitly provides indemnification for [indemnitee’s] own negligence pursuant

to the rest of the contract terms.” Id. at 318.

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Under Illinois law, the duty to defend is separate and distinct from the duty to

indemnify, and the duty to defend is broader. See Outboard Marine Corp. v. Liberty

Mut. Ins. Co., 154 Ill. 2d 90, 125, 180 Ill. Dec. 691, 607 N.E.2d 1204, 1220 (1992)

(discussing the distinction generally in the context of insurance). Further, Illinois

courts do not apply the general rule placing a heightened duty-to-defend burden on

insurers to all contracts to defend and will apply “a separate approach for analyzing

the duty to defend in the buyer-seller context.” Medline Industries, Inc. v. Ram

Medical, Inc., 892 F. Supp. 2d 957, 965 (N.D. Ill. 2012) (citing Ervin v. Sears,

Roebuck and Co., 469 N.E.2d 243, 127 Ill. App. 3d 982, 82 Ill. Dec. 709 (1984)).

Analysis

With these principles in mind, we turn to the contract. Allied advocates for an

interpretation of the Indemnity provision that isolates certain portions of it in

determining whether it had a duty to defend TWM under the Agreement. It urges

this Court employ a strained reading that splits the Indemnity provision at issue into

a “first part” and a “second part” with neither part used as context for the other. In

doing so, it advocates for a meaning that is unmoored from the Agreement as a whole

and from the broader context that would inform the parties’ intent as expressed by

the plain and ordinary language of the text. In contrast, TWM encourages us to look

at the entire provision in the broader context of the Agreement as a whole. Under

Illinois law, we believe the approach advocated by TWM in construing the

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Agreement is correct. See Joyce, 371 Ill. App. 3d at 74, 308 Ill. Dec. at 545, 861

N.E.2d at 1110; Lempa, 278 Ill. App. 3d at 428, 215 Ill. Dec. at 416, 663 N.E.2d at

166. We now turn to the provision at issue, examining the plain and ordinary

meaning of the language in the broader context of the entire Agreement.

First, Allied breaks the provision outlining the defense and indemnity

requirements into two parts and would have us focus on “to the extent caused by”

language alone. That said, these “parts” are not the entire provision. A careful

reading of the provision shows that Allied agreed “that it shall defend . . . and hold

harmless [TWM] . . .from and against any claims, liabilities, losses, damages, actions,

causes of actions or suits to the extent caused by (A) any actual or alleged negligent

or grossly negligent act or omission or willful misconduct of Contractor or its agents

or employees at the Property or in connection with this Agreement or breach thereof

in any way[.]” (Emphasis added.) This language specifies that Allied agreed to

defend TWM against allegations of Allied’s negligence at the property or in

connection with the Agreement, which other provisions show was to procure

security services. This language does not limit Allied’s duty to defend against

situations in which there were no allegations of negligence against TWM. Rather,

the focus is on any allegations of negligence against Allied as the triggering

mechanism to defend. Even considering the “to the extent caused by” language as

limiting, when viewed in context it undercuts Allied’s proposed reading. The duty

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to defend is implicated since the claims, causes of action, or lawsuit at issue were

allegedly caused by the negligent performance of certain responsibilities delegated

to Allied under the contract.

Prater pleaded that all defendants, including Allied, were negligent in several

respects, including failing to train their employees and staff “in the most basic

security procedures[,]” to monitor security cameras, to recognize potential criminal

activity, to deter criminal activity, and timely report criminal activity. She also

alleged that they lacked adequate security policies and protocols and failed to

appropriately employ appropriately trained personnel. These allegations arose from

alleged failures which occurred at the property. While the provision is framed in the

disjunctive, allegations of negligence against Allied “in connection” with the

Agreement is an alternative way that the duty to defend may arise in the situation

before us. “Connection” is defined as a “causal or logical relation or sequence” or

“contextual relation or association.” Meriam-Webster Online Dictionary,

https://merriam-webster.com/dictionary/connection, last visited Jan. 29, 2026.

Prater’s claims could likewise be viewed as being “in connection with the

Agreement,” as they dealt with multiple alleged failures related to or associated with

provision of security services, which was the Agreement’s entire purpose.

Second, the defense and indemnity provision proceeds to express the parties’

intent by stating:

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It is intended that all claims and demands, legal proceedings and
lawsuits in which any party to this Agreement or additional insured
under this Agreement is named or described as a defendant which
alleges or describes any claim in which Contractor or a security officer
has done or has failed to do any act or thing required pursuant to this
Agreement or failed to provide the Services at the Property shall be a
claim tendered to, accepted by or defended by Contractor.

Allied focuses on the disjunctive “or” in this last sentence to support its argument

that it did not have to defend this claim – the claim need only have been tendered to

it, and it was within its rights to reject the claim under the Agreement. We agree that

the “or” is disjunctive. That said, focusing on this single “or” outside of the context

of the Agreement as a whole makes the entire provision, along with many other

provisions of the Agreement meaningless and mere surplusage, which we will not

do. See Lempa, 278 Ill. App. 3d at 428, 215 Ill. Dec. at 416, 663 N.E.2d at 166.

Allied urges us to construe this Agreement in such a way that it did not have a duty

to defend because TWM was also named as a defendant with allegations of

negligence against it. Importantly, this construction ignores language “that all claims

and demands, legal proceedings and lawsuits in which any party to this

Agreement . . . is named or described as a defendant[.]” The plain language of the

defense and indemnity provision negates any reading that TWM’s status as a named

defendant or claims of negligence against it would be the determinative factor in its

right to a defense from Allied.

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This provision also requires Allied to pay TWM liquidated damages if Allied

refuses a tender of defense or provides a defense under a reservation of rights that

TWM does not consent to “for the amount of the added internal expense” TWM

incurs “in dealing with the claim.” The Agreement’s plain language, read in context,

shows that the parties intended to shift the cost of defending and dealing with such

claims to Allied. The liquidated damages are in addition to the other costs of defense.

Third, the Agreement’s other provisions provide additional context for the

parties’ intent that Allied has a duty to defend TWM in circumstances like the ones

before us. Allied contends that Prater did not allege TWM was liable for Allied’s

acts or omissions under a theory of alter ego or vicarious liability. Allied focuses on

what Prater fails to allege while ignoring what she does allege, including failures

relating to the provision of security services and the training of security staff and

which the Agreement shows was Allied’s responsibility. The Agreement’s language

expressly states that Allied is responsible for training and providing security staff.

The contract’s requirement that Allied was to procure insurance naming TWM as an

additional insured also informs this analysis, as it is yet another indication that the

parties intended to shift the cost and risk related to security services from TWM to

Allied.

Fourth and finally, Allied blurs the lines between the duties to defend and

duties to indemnify. It advocates for strict construction of this “Indemnity provision”

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as being one that requires indemnifying TWM for its own negligence in these

circumstances. We disagree that this is such a provision. Rather, its particular

language and the Agreement as a whole, along with the factual setting of this case,

establishes that Allied is to defend and indemnify where the alleged acts of

negligence or failures result from its provision of security services. See Buenz, 227

Ill. 2d at 310–11, 317 Ill. Dec. at 650, 882 N.E.2d at 530; see also Wilda, 470 F.

Supp. 3d at 784. Under this contract, Allied is the party who bears the responsibility

to provide those services.

Allied also cites Dominick’s Finer Foods, LLC v. Eurest Servs., Inc., No. 01-

15-0369, 2015 IL App. (1st) 150369-U, 2015 WL 673491, at *7 (Ill. App. Ct. Nov.

2, 2015), for the proposition that it did not have the same heightened duty to defend

as an insurance carrier. We agree that Illinois law treats non-insurers differently than

insurers as it relates to a duty to defend. See Ervin, 469 N.E.2d at 249–50, 127 Ill.

App. 3d at 990, 82 Ill. Dec. at 715–16 (explaining that insurance contracts are

construed liberally in favor of the insured and insurance companies are not allowed

to look behind allegations in complaint while non-insurers are entitled to

investigate); Medline Indus., Inc., 892 F. Supp. 2d at 965 (citation omitted) (same);

see also Dominick’s Finer Foods, 2015 WL 673491, at *7. That said, the heightened

duty referenced requires an insurer to promptly defend without looking behind the

allegations in a complaint, whereas a non-insurer may investigate a claim before

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denying a tender. See Ervin, 469 N.E.2d at 249–50, 127 Ill. App. 3d at 990, 82 Ill.

Dec. at 715–16; Medline Indus., Inc., 892 F. Supp. 2d at 965; see also Dominick’s

Finer Foods, 2015 WL 673491, at *7. There are no allegations here by either party

that Allied had a good-faith basis for denying the tender of defense because it needed

time to investigate. Even so, the court in Dominick’s Finer Foods determined that

the contract “should be analyzed under ordinary contract principles.” Dominick’s

Finer Foods, 2015 WL 673491, at *7. One notable distinction between this case and

Dominick’s Finer Foods, LLC v. Eurest Services is that case involved allegations of

negligence arising from the owner’s conduct of placing a mat down in a store, which

was wholly unrelated to the provision of services under the contract. See 2015 WL

6735491, at *8. While Allied focuses on the “to the extent caused by” language in

that case, Allied’s argument is unpersuasive because the alleged acts of negligence

here dealt with the provision of security services, which was Allied’s responsibility

under the contract.

Considering the entire Agreement and giving effect to the parties’ intent, as

determined by the plain and ordinary meaning of the contract language, we hold the

trial court correctly interpreted the contractual provision as requiring Allied to

defend TWM. See Joyce, 371 Ill. App. 3d at 74, 308 Ill. Dec. at 545, 861 N.E.2d at

1110; Lempa, 278 Ill. App. 3d at 428, 215 Ill. Dec. at 416, 663 N.E.2d at 166; see

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also Buenz, 227 Ill. 2d at 310–11, 317 Ill. Dec. at 650, 882 N.E.2d at 530; Wilda,

470 F. Supp. 3d at 784. We overrule issues one and two.

REMAINING ISSUES

Since an analysis of issues three through five depends on this Court

determining that Allied did not have a duty to defend Allied, and we have already

determined Allied did have such a duty, we need not reach Allied’s remaining issues.

See Tex. R. App. P. 47.1.

CONCLUSION

Having overruled Allied’s dispositive issues, we affirm the trial court’s

judgment.

AFFIRMED.

W. SCOTT GOLEMON
Chief Justice

Submitted on October 16, 2025
Opinion Delivered February 12, 2026

Before Golemon, C.J., Wright and Chambers, JJ.

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