Adams v. Chicago Insurance
Eric R. Adams, an attorney, sued Chicago Insurance Company for breach of its professional liability insurance policy, seeking a declaration that Chicago had a duty to defend and indemnify him in an underlying professional malpractice lawsuit brought by Patricia E. Novak. Chicago disclaimed coverage, asserting Adams failed to provide timely notice of the potential malpractice claim as required by the policy's terms. The court initially found that Adams, despite his claims of a good faith belief in non-liability, unreasonably delayed notifying Chicago of the potential claim. However, the court ultimately concluded that Chicago was equitably estopped from denying coverage due to its own unreasonable eight-month delay in formally disclaiming coverage after receiving initial notice from Adams and for engaging in conduct that gave the appearance of defending Adams. Consequently, the court denied Chicago's motion for summary judgment and granted Adams' motion, compelling Chicago to defend and indemnify Adams in the malpractice action.