Contracts of insurance are to be construed according to the sense and meaning of the terms which the parties have used and, if they are clear and unambiguous, their terms are to be taken and understood in their plain, ordinary, and popular sense. 43 Am. Jur. 2d Insurance §277, at 351 (1982); Kelly v. Brotherhood of R.R. Trainmen (1923), 308 Ill. 508, 140 N.E. 5.
The section of the policy in the present dispute provides:
“(a) [B]y reason of any act, error or omission in professional services rendered or that should have been rendered by the Insured or by any person for whose acts, errors or omissions the Insured is legally responsible, and arising out of the conduct of the Insured’s profession as a real estate agent or real estate broker including the following related activities for real estate: consultation, appraisal, property management, property management consultation or notary public.”
The word “rendered” has many meanings, including to “melt down (fat) by heating” (American Heritage Dictionary 1046 (2d C. ed. 1982); however, the only reasonable definition to give the use in the contested policy is “to pay or perform” (Black’s Law Dictionary 1460 (4th ed. 1968)). The coverage is for any act, error, or omission performed arising out of conduct of the real estate business; and, when read with the specific listed inclusion “consultation, appraisal, property management, property management consultation, or notary pub-lie,” leads to the conclusion the coverage relates to faulty performance of services to clients of the real estate firm.
The underlying claim against the insured is described in the second-amended complaint by allegations of: (1) tortious interference with a contractual relationship for prospective economic advantage; (2) breach or inducing breach of fiduciary duty by an officer or director; (3) unfair competition; (4) theft of trade secrets; (5) conspiracy to interfere with contractual relationship; and (6) fraud. The insured defendants, Joseph and Joann Corley, had been employees of Dependable Realty, but they had left to establish their own firm. The various counts of the underlying complaint filed against the insured were primarily based upon Joseph Corley’s previous employment by Dependable Realty as its sales manager.
I would find the insurance policy terms to be clear and unambiguous — and only apply to acts, errors, and omissions performed for customers or clients of the real estate business. By no stretch of the imagination can the disgruntled former employer be considered a customer or client.
There is a similarity with attorney error and omission policies. Those policies insure against mistakes or omissions in performing legal services. To extend the attorney policy coverage for a wrongdoing to a former law firm would be ludicrous. The circuit court and the majority failed to give a reasonable interpretation to the terms of the insurance policy.