And, as Illinois courts have held, "there is no estoppel where the insurer was given no opportunity to defend." La Rotunda, supra, 87 Ill.App.3d at 452, 42 Ill.Dec. at 225, 408 N.E.2d at 934; McFadyen v. North River Insurance Co., 62 Ill.App.2d 164, 168, 209 N.E.2d 833, 836 (1965). . . . [W]e cannot say that the City's defense was adequately tendered to Gulf. No official of the City ever asked Gulf to defend Peoria. Rather the defense was tendered to Gulf 10 months after the litigation began by the attorney for Hartford, the City's primary insurance carrier, acting on his own initiative.
The complaint must be liberally construed and all doubts about coverage resolved in favor of the insured. See Sentry Insurance Co. v. S L Home Heating Co., 91 Ill.App.3d 687, 689, 47 Ill.Dec. 102, 104, 414 N.E.2d 1218, 1220 (1980), McFadyen v. North River Insurance Co., 62 Ill.App.2d 164, 168, 209 N.E.2d 833, 836 (1965). The duty to defend is broader than the duty to pay.
For a description of the relevant offenses see Section II of this opinion, infra, p. 11. The duty to defend is considered broader than the duty to pay. AllstateInsurance Co. v. Gleason, 50 Ill. App.2d 207, 214, 200 N.E.2d 383, McFayden v. North River Ins. Co., 62 Ill.App.2d 164, 209 N.E.2d 833. McFayden also states the rule that the insurer's duty to defend is "predicated upon the allegations in the complaint * * * and when such allegations state facts which bring the case within, or potentially within, the coverage of the policy, the insurer is from this time on unjustified in not defending the insured." Sprayregen v. American Indemnity Co., 105 Ill. App.2d 318, 325, 245 N.E.2d 556, 560 (1969).
This is true even if it becomes apparent from matter outside the complaint against the insured that coverage is excluded by some other clause of the policy. George H. Wolff Sons, Inc. v. Aetna Casualty Surety Co., 286 F.2d 862 (7th Cir. 1961); Palmer v. Sunberg, 71 Ill. App.2d 22, 217 N.E.2d 463 (1966); Stein v. Lindquist, 69 Ill. App.2d 340, 217 N.E.2d 438 (1966); McFadyen v. North River Ins. Co., 62 Ill. App.2d 164, 209 N.E.2d 833 (1965); Sims v. Illinois National Casualty Co. of Springfield, 43 Ill. App.2d 184, 193 N.E.2d 123 (1963); Gould v. County Mutual Casualty Co., 37 Ill. App.2d 265, 185 N.E.2d 603 (1962); Rom v. Gephart, 30 Ill. App.2d 199, 173 N.E.2d 828 (1961). Perhaps the most concise statement of this rule is found in McFadyen v. North River Ins. Co., supra, 62 Ill.App.2d at 170-171, 209 N.E.2d at 836:
These circumstances include where the insurer was given no opportunity to defend; where there was no insurance policy in existence; and where, when the policy and the complaint are compared, there clearly was no coverage or potential for coverage. See La Rotunda v. Royal Globe Insurance Co., 87 Ill. App.3d 446, 452 (1980); McFadyen v. North River Insurance Co., 62 Ill. App.2d 164, 171 (1965). Once the insurer breaches its duty to defend, however, the estoppel doctrine has broad application and operates to bar the insurer from raising policy defenses to coverage, even those defenses that may have been successful had the insurer not breached its duty to defend.
In Illinois the rule is that an insurer is estopped from asserting noncoverage if he has failed to provide a defense and the claim is within the coverage of the policy. ( McFadyen v. North River Insurance Company (1965) 62 Ill. App.2d 164 [ 209 N.E.2d 833, 836-837]; Sims v. Illinois National Casualty Co. (1963) 43 Ill. App.2d 184 [ 193 N.E.2d 123, 129].)
( Sherman v. Home Insurance Co. (1975), 25 Ill. App.3d 519, 522; Hartford Accident Indemnity Co. v. Case Foundation Co. (1973), 10 Ill. App.3d 115, 121.) It is the duty of an insurer to defend an action brought against the insured if the complaint alleges facts within, or potentially within, policy coverage. ( Thornton v. Paul (1978), 74 Ill.2d 132, 144; McFadyen v. North River Insurance Co. (1965), 62 Ill. App.2d 164, 170; Mol v. Holt (1980), 86 Ill. App.3d 838, 840; Reis v. Aetna Casualty Surety Co. (1978), 69 Ill. App.3d 777.) Moreover, the duty to defend extends to cases where the complaint alleges several causes of action or theories of recovery against an insured even if only one or some of them are within the policy coverage.
The duty to defend is distinguishable from, and in some ways broader than, the duty to indemnify. Ins Co of North America v Forty-Eight Insulations, Inc, 451 F. Supp. 1230 (ED Mich, 1978), citing Sprayregen v American Indemnity Co, 105 Ill. App.2d 318; 245 N.E.2d 556 (1969), McFadyen v North River Ins Co, 62 Ill. App.2d 164; 209 N.E.2d 833 (1965). In Maryland Casualty Co v Peppers, 64 Ill.2d 187; 355 N.E.2d 24 (1976), the Illinois Supreme Court stated:
With few exceptions, it is the duty of an insurer to defend an action brought against the insured if the complaint alleges facts within, or potentially within, policy coverage. ( Thornton v. Paul (1978), 74 Ill.2d 132, 144; Reis v. Aetna Casualty Surety Co. (1978), 69 Ill. App.3d 777, 784; McFadyen v. North River Insurance Co. (1965), 62 Ill. App.2d 164, 170-71.) Unless the complaint, on its face, clearly alleges facts which, if true, would exclude coverage, the potentiality of coverage is present and the insurer has a duty to defend.
An insurer's duty to defend, however, is predicated not on facts disclosed by an insurer's independent investigation which indicates or even proves noncoverage, but only upon allegations in the complaint against the insured. See Campidonica v Transport Indemnity Co, 217 Cal.App.2d 403; 31 Cal.Rptr. 735 (1963), McFadyen v North River Insurance Co, 62 Ill. App.2d 164; 209 N.E.2d 833 (1965), Missionaries of the Company of Mary, Inc v Aetna Casualty Surety Co, 155 Conn. 104; 230 A.2d 21 (1967), Employers' Fire Insurance Co v Beals, 103 R.I. 623; 240 A.2d 397 (1968). As Judge Learned Hand has stated, the duty to defend means