Four Corners Rule Strikes Again

Employee’s Suit Against Employer For Mesothelioma Barred by Workers’ Compensation Exclusivity

Every state in the United States has a workers’ compensation system where, to avoid the need to prove liability of an employer who is believed to have negligently injured an employee. In exchange for the protection without a need to prove fault the employee is limited by state law to the exclusive remedy of workers’ compensation.

In National Fire Insurance Company Of Hartford and Transportation Insurance Company v. Burns & Scalo Roofing Company, United States District Court, E.D. Pennsylvania, 2017 WL 372144, Civil Action NO. 15-6028, (01/26/2017) the USDC for the Eastern District of Pennsylvania was asked to compel insurers defend the employer to a tort suit brought by an ex-employee.

Plaintiffs moved for summary requesting judgment in their favor and a declaration that Plaintiffs do not owe a further duty to defend and/or indemnify Defendant in the above-referenced state court action because the four corners of the underlying lawsuit clearly fit within the exclusion for no coverage for injuries to employees.


Briefly, in the underlying state court action filed by Carl and Lori Bremer (collectively “the Bremers”) against Burns & Scalo, (the same Defendant in this federal case), Carl Bremer (“Dr. Bremer”) contends that during the summer months of the years 1973 through 1976, he was employed by Defendant, was exposed to asbestos dust and fibers during his employment and, as a result of this exposure, developed malignant mesothelioma. In said complaint, his wife, Lori Bremer, pled a claim for loss of consortium. The state court complaint incorporated, by reference, allegations and causes of action asserted in a master long form complaint filed as In re Asbestos Litigation in Philadelphia Court of Common Pleas, No. 8610-0001 (“the Master Long Form Complaint”), including, inter alia, an allegation in Count VII that Dr. Bremers injuries resulted from Defendant’s intentional tortious conduct as Bremer’s employer. The nine-paragraph state court complaint contains very little by way of factual allegations. However, it explicitly alleges that Dr. Bremer was employed by Defendant, and that his exposure to asbestos dust and fiber during the course of his employment with Defendant was the proximate cause of his injuries.

In the state court matter, Defendant sought a defense and indemnification from Plaintiffs consistent with the provisions of the general liability insurance occurrence policies issued to Defendant between the years 1988 and 1992 (“the Policies”). The Policies, which contained identical provisions, essentially provide for a defense and indemnification in any lawsuit seeking damages for “bodily injury” that occurs during the policy coverage period. The Policies defined the term “bodily injury” as “bodily injury, sickness or disease sustained by a person, including death resulting from any of these at any time.”

After being served with the state court complaint, Defendant provided Plaintiffs with the notice of the underlying state court action. On August 26, 2015, Plaintiffs denied insurance coverage.

On September 12, 2016, a jury trial in the state court action commenced. The Bremers, as the plaintiffs therein, presented evidence of Dr. Bremer’s summer employment with Defendant between 1973 and 1976, of his exposure to asbestos during that employment period, and his subsequent diagnosis of malignant mesothelioma. While the jury was deliberating but before a verdict was rendered, Defendant and the Bremers reached a confidential settlement for an amount within the Policies’ ̈limits.


Under Pennsylvania law, an insurer’s duty to defend is broader than its duty to indemnify. However, there is no duty to indemnify if there is no duty to defend. To determine whether Plaintiffs owe a duty to defend and/or indemnify Burns & Scalo, the allegations in the state court complaint and the language of the insurance policies issued to Burns & Scalo, must be examined.

If the underlying complaint alleges an injury “which may be within the scope of the policy, the company must defend the insured until the insurer can confine the claim to a recovery that the policy does not cover.” However, to prevent artful pleading designed to avoid policy exclusions, it is necessary to look at the factual allegations in the complaint, and not how the underlying plaintiff frames the request for relief. The particular cause of action that a complainant pleads is not determinative of whether coverage has been triggered. The burden rests upon the insurer to demonstrate that the allegations of the complaint cast that pleading solely and entirely within the policy exclusions.

Plaintiffs moved for summary judgment on the premise that they have no duty to defend Defendant in the underlying state court matter because the facts and injuries therein alleged unambiguously fall within the exclusionary provision of the Policies. Defendant does not dispute Plaintiffs characterization of the factual allegations in the state court complaint. Rather, Defendant argues that Plaintiffs have not foreclosed the possibility that the allegations in the state court complaint fall outside the Exclusion eliminating coverage for injuries to employees.

In determining if a duty to defend exists, the court is charged with deciding whether the underlying complaint creates any possibility of coverage. The factual allegations of the underlying state court complaint clearly and unmistakably indicate that the Bremers’ causes of action arose out of the exposure to asbestos during the course of Dr. Bremer’s employment with Defendant. The Bremers successfully litigated their state court action based upon these facts.

It is patently clear that the allegations in the underlying state court complaint fall within the Exclusion provisions and, therefore, outside the scope of any insurance coverage. The state court complaint has the hallmarks of an action asserted by an employee against his employer for an occupational disease.

Notwithstanding, Defendant contends that these general allegations do not necessarily foreclose the theoretical possibility that Dr. Bremer was not Burns & Scalo’s employee during the entire period of his exposure to asbestos. Defendant urges this Court to consider a wide array of extrinsic evidence, including the testimony of the Trybuses in the underlying action, to conclude that Dr. Bremer was an independent contractor or subcontractor. However, Pennsylvania law is clear that Plaintiffs’ duty to defend a suit must be determined solely by the four corners of the underlying complaint.

The factual allegations in the state court complaint unequivocally indicate that the underlying injuries arose out of and in the course of Dr. Bremer’s employment by Defendant. The state court complaint did not allege any facts that could potentially fall within the scope of coverage. Consequently, because the claims alleged in the state court complaint fall within the Exclusion provisions, Plaintiffs have no duty to defend or to indemnify Defendant in the underlying action.

Plaintiffs’ motion for summary judgment was granted. Plaintiffs have no further duty to defend and/or indemnify Defendant in the underlying law suit identified as Bremer, et al. v. Burns and Scalo Roofing, Inc., Civil Action No. 149004424, Court of Common Pleas of Philadelphia County, Pennsylvania.


The court applied the law of the state of Pennsylvania that regardless of the existence of extrinsic facts that might create a potential for coverage the four corners rule requires the decision with regard to the duty to defend is limited to the four corners of the lawsuit for which defense is sought. The court only looked to the factual allegations in the complaint, and not how the underlying plaintiff frames the request for relief. The allegations of the complaint limited the exposure to the time Dr. Bremer was employed by the defendant.

ZALMA-INS-CONSULT                      © 2017 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant and expert witness specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 49 years in the insurance business.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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