## Facts

- A bank relocated within Tinley Park, Illinois, and arranged for police to transport cash while a moving company transported office equipment, including metal lockers in the vault.
- The day before the move, the bank instructed tellers to place cash in canvas bags on the vault floor rather than in individual metal lockers; one teller did not receive the instruction.
- The teller placed $10,342.03 in her metal locker inside the vault.
- Police moved the cash located on the vault floor to the new premises under guard.
- After the police completed their work, employees of the moving company entered the bank to remove the metal lockers and other equipment.
- A mover’s employee noticed something inside one locker, opened it after loading the lockers, discovered the cash, finished his workday, and later stole the $10,342.03; the money was never recovered.
- The bank sued the insurer under a bankers blanket bond and, alternatively, sued the moving company under respondeat superior for the employee’s larceny.
- The district court granted summary judgment for both defendants.

## Issues

1. Whether summary judgment for the insurer was proper where the bank claimed the bankers blanket bond’s “on premises” coverage applied to the theft discovered during the move.
2. Whether the moving company could be held vicariously liable under Illinois law for an employee’s theft of the bank’s cash.

## Decision

- The court reversed summary judgment for the insurer on the bond claim and remanded for further proceedings.
- The court affirmed summary judgment for the moving company on the respondeat superior claim.
- As to the bond, the court held the insurer had not shown on undisputed facts that coverage was negated as a matter of law.
- As to the moving company, the court held the employee’s later theft was outside the scope of employment and not in furtherance of the employer’s business.

## Legal Principles

- Summary judgment is improper on an insurance coverage claim when policy language and loss circumstances permit more than one reasonable reading and unresolved interpretive/factual questions remain.
- Ambiguous insurance contract terms are construed against the insurer that drafted the instrument.
- Under Illinois respondeat superior, an employer is liable only for torts committed within the scope of employment and in furtherance of the employer’s business.
- An employee’s intentional criminal theft for personal reasons is ordinarily outside the scope of employment, even if the employment provided the opportunity to steal.

## Conclusion

The Seventh Circuit held that the bond claim required further litigation because coverage could not be rejected as a matter of law on the summary-judgment record, but it rejected vicarious liability against the moving company because the employee’s theft was a personal criminal act outside the scope of his work.


Bremen State Bank v. Hartford Accident & Indem. Co., 427 F.2d 425 (7th Cir. 1970)