COMCAST OF GARDEN STATE, LP VS. THE HANOVER INSURANCE COMPANY (L-0925-16, CAMDEN COUNTY AND STATEWIDE)

• Court: New Jersey Superior Court Appellate Division
• Decided: July 10, 2019
• Docket: A-3245-17T4
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-3245-17T4

COMCAST OF GARDEN STATE, LP,

Plaintiff-Respondent/ Cross-Appellant,

v.

THE HANOVER INSURANCE COMPANY and JNET COMMUNICATIONS, LLC, t/d/b/a VITEL COMMUNICATIONS, LLC,

Defendants-Appellants/ Cross-Respondents. _______________________________

Submitted March 13, 2019 – Decided July 10, 2019

Before Judges Accurso and Vernoia.

On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. L-0925-16.

Donnelly Minter & Kelly, LLC, attorneys for appellants/cross-respondents (Seth Alan Abrams and David Morgan Blackwell, on the briefs). Lavin, O'Neil, Cedrone & DiSipio, attorneys for respondent/cross-appellant (Michael J. Quinn, on the briefs).

PER CURIAM

In this insurance coverage and breach of contract action, defendants The

Hanover Insurance Company (Hanover) and JNET Communications, LLC

(JNET), appeal from orders granting plaintiff Comcast of Garden State, LP

(Comcast), summary judgment, finding Comcast is entitled to a defense and

indemnification under an insurance policy Hanover issued to JNET, awarding

Comcast $349,468.83 in defense costs and fees, and denying Hanover's motions

for summary judgment dismissing the complaint. 1 Comcast cross-appeals

asserting that if it is determined the court erred by finding Comcast is entitled

to a defense and indemnification under the policy, we should reverse the court 's

order denying Comcast's motion for summary judgment on its contract claim

1 Defendants' notice of appeal also references the court's October 27, 2017 order denying their motion for reconsideration. Defendants' briefs on appeal do not include any argument challenging the court's order on the reconsideration motion and we therefore do not address that order. An argument not briefed on appeal is deemed waived. R. 2:6-2(a)(6); see also El-Sioufi v. St. Peter's Univ. Hosp., 382 N.J. Super. 145, 155 n.2 (App. Div. 2005). We note, however, that because we reverse the orders from which defendants sought reconsideration, it would be otherwise unnecessary to address the merits of the reconsideration order.

A-3245-17T4 2 against JNET. Based on our review of the record in light of the applicable law,

we reverse in part, affirm in part and remand for further proceedings.

I.

Richard Endres filed a complaint alleging he sustained injuries due to the

negligence of JNET and Comcast when he tripped over a temporary above-

ground cable JNET installed while performing work as Comcast's contractor.

Comcast tendered its defense to Hanover under the comprehensive general

liability policy it issued to JNET as the insured, and Hanover initially accepted

the defense and assigned counsel to Comcast and JNET. Comcast was dismissed

from the litigation based on JNET's admission that it placed a temporary cable

on the property.

The claim against Comcast was subsequently reinstated on Endres's

motion after deposition testimony suggested that a Comcast technician placed

or replaced the temporary cable after the JNET employee first placed the cable

on the property where Endres fell. Hanover tendered the defense back to

Comcast, claiming the alleged loss "did not arise out of [JNET's] work" and

therefore Comcast was not owed a defense under the policy. At the trial on

Endres's claim, the jury found Comcast sixty percent liable and JNET forty

percent liable, and awarded damages.

A-3245-17T4 3 Comcast filed a complaint against Hanover and JNET seeking a

declaratory judgment that Hanover was obligated to defend and indemnify

Comcast because Comcast was an additional insured entitled to coverage under

the policy. Comcast also asserted a claim against JNET alleging that if Comcast

was not covered under the policy, JNET breached its contract with Comcast by

failing to obtain the insurance required under that contract.

The court granted Comcast's subsequent motion for summary judgment

finding Comcast was an additional insured entitled to a defense and

indemnification under the policy, awarded Comcast $349,468.83 in defense

costs and fees, and denied Hanover's motion for summary judgment for

dismissal of the complaint. The court also denied Comcast's motion for

summary judgment on its breach of contract claim against JNET, determining

there was no basis for the claim because JNET had, in fact, obtained the required

insurance coverage under its contract with Comcast. Following the denial of

defendants' motion for reconsideration, this appeal followed.

II.

By its grant of summary judgment to Comcast, the court determined

Comcast was an additional insured entitled to coverage for its own negligence

under the insurance policy Hanover issued to JNET as the insured. "We apply

A-3245-17T4 4 the same standard the judge applied in ruling on summary judgment." Wear v.

Selective Ins. Co., 455 N.J. Super. 440, 453 (App. Div. 2018). We determine

whether there are any genuine issues of material fact when the evidence is

viewed in the light most favorable to the non-moving party, Rowe v. Mazel

Thirty, LLC, 209 N.J. 35, 38-41 (2012), and whether, based on the undisputed

facts, the moving party "must prevail as a matter of law," Brill v. Guardian Life

Ins. Co. of Am., 142 N.J. 520, 540 (1995) (quoting Anderson v. Liberty Lobby,

477 U.S. 242, 252 (1986)). We review the court's determination of legal issues

de novo. Manalapan Realty, LP v. Twp. Comm. of Manalapan, 140 N.J. 366,

378 (1995).

The material facts pertaining to the interpretation of the JNET policy are

not in dispute. In the underlying personal injury trial, the jury determined JNET

is forty percent liable for Endres's injuries based on its negligence and Comcast

is sixty percent liable based on its negligence. JNET is the named insured under

the policy. Comcast is entitled to a defense and indemnification from Hanover

under the policy only if Comcast qualifies as an additional insured for its own

negligence.

"The interpretation of an insurance policy upon established facts is a

question of law for [this] court to determine," Wear, 455 N.J. Super. at 453,

A-3245-17T4 5 "independent of the [motion] court's conclusions," Thompson v. James, 400 N.J.

Super. 286, 291 (App. Div. 2008) (quoting Simonetti v. Selective Ins. Co., 372

N.J. Super. 421, 428 (App. Div. 2004)). Thus, Hanover's appeal presents a

question of law: is Comcast an additional insured for its own negligent acts

under the policy? For the reasons that follow, we conclude Comcast is not an

additional insured for its own negligence and that the motion court erred by

finding otherwise.

We apply well-established principles governing the interpretation of an

insurance policy. "[T]he basic rule is to determine the intention of the parties

from the language of the policy, giving effect to all parts so as to give a

reasonable meaning to its terms." Simonetti, 372 N.J. Super. at 428. We "give

the policy's words 'their plain, ordinary meaning,'" Wear, 455 N.J. Super. at 453

(quoting Nav-Its, Inc. v. Selective Ins. Co. of Am., 183 N.J. 110, 118 (2005)),

"cannot make a better contract for the parties than the one that they themselves

agreed to" and "must enforce the contract as written," Simonetti, 372 N.J. Super.

at 428.

Generally, "policies should be construed liberally in . . . favor [of the

insured] to the end that coverage is afforded 'to the full extent that any fair

interpretation will allow.'" Kievit v. Loyal Protective Life Ins. Co., 34 N.J. 475,

A-3245-17T4 6 482 (1961) (citation omitted). Where the parties dispute the interpretation of

the policy, "it is the insured's burden to bring the claim within the basic terms

of the policy." Polarome Int'l, Inc. v. Greenwich Ins. Co., 404 N.J. Super. 241,

258 (App. Div. 2008) (quoting Rosario v. Haywood, 351 N.J. Super. 521, 529

(App. Div. 2002)).

Where an ambiguity exists, the court will ordinarily resolve same in favor

of the insured. Cruz-Mendez v. ISU/Ins. Servs. of S.F., 156 N.J. 556, 571

(1999). But where there is no ambiguity in the policy, the court "may not engage

in a strained construction to impose a duty on the carrier that is not contained in

the policy." Polarome, 404 N.J. Super. at 259. If the terms of the policy are

clear, we must enforce them as written. Stone v. Royal Ins. Co., 211 N.J. Super.

246, 248 (App. Div. 1986).

Here, Comcast's claim it is an additional insured rests upon the following

policy provisions:

1. Additional Insured by Contract, Agreement or Permit

....

5.a. Any person or organization with whom you agreed, because of a written contract, written agreement or permit to provide insurance, is an insured, but only with respect to:

A-3245-17T4 7 (1) "Your work" for the additional insured(s) at the location designated in the contract, agreement or permit; or

(2) Premises you own, rent, lease or occupy.

This insurance applies on a primary basis if that is required by the written contract, written agreement or permit.

[(Emphasis added).]

The policy defines "Your Work" as:

22. "Your work":

a. Means:

(1) Work or operations performed by you or on your behalf; and

(2) Materials, parts or equipment furnished in connection with such work or operations.

b. Includes:

(1) Warranties or representations made at any time with respect to the fitness, quality, durability, performance or use of "your work", and

(2) The providing of or failure to provide warnings or instructions.

A-3245-17T4 8 Hanover argues that under the circumstances presented here Comcast is

not an additional insured for its own negligent acts under the plain language of

the policy. More particularly, Hanover notes the policy provides Comcast is an

additional insured but "only with respect to" JNET's work. Hanover contends

Comcast is not an additional insured for its own negligence because the jury

based its finding of Comcast's liability on Comcast's direct negligence unrelated

to JNET's work and not vicarious liability based on JNET work. 2 Hanover

contends that Comcast is not an additional insured "with respect to" the work

for which the jury found it directly liable, and that Comcast's contentions to the

contrary ignore the policy's plain and unambiguous language and the jury's

verdict. We agree.

In the first instance, to qualify as an additional insured under the policy,

Comcast must be a party for whom JNET, as the named insured, agreed to

provide insurance. That condition is satisfied here; JNET agreed to provide

insurance under its contract with Comcast. However, Comcast's status as a party

2 The record does not include any specific findings made by the jury beyond its allocation of liability in its verdict: sixty percent to Comcast and forty percent to JNET. In their submissions to this court, the parties do not dispute that the jury's determination of the parties' respective liabilities is based solely on the jury's findings as to each party's direct negligence.

A-3245-17T4 9 to whom JNET contractually agreed to provide insurance does not, by itself,

render Comcast an additional insured entitled to coverage.

The policy expressly and unambiguously limits those who satisfy the first

requirement for qualification as an additional insured. Thus, those parties to

whom JNET agreed to provide insurance are additional insureds but "only with

respect to . . . Your Work." The policy defines "Your Work" as JNET's "[w]ork

or operations" or "[m]aterials, parts or equipment furnished in connection with

such work or operations."

We apply the ordinary meaning of the terms "only" and "with respect to"

because they are not defined in the policy. Wear, 455 N.J. Super. at 453; see

also Zacarias v. Allstate Ins. Co., 168 N.J. 590, 595 (2001). "With respect to"

means "with reference to" and "in relation to." Merriam-Webster.com

Dictionary, https://www.merriam-webster.com/dictionary/respect (last visited

June 19, 2019). The term "only" is distinctly one of limitation; only is ordinarily

defined as "solely" or "exclusively." Merriam-Webster.com Dictionary,

https://www.merriam-webster.com/dictionary/only (last visited June 19, 2019).

Thus, under the policy's plain language, Comcast is an additional insured solely

and exclusively in reference and relation to JNET's work.

A-3245-17T4 10 Comcast makes no showing that its liability for Endres's injuries was

based on JNET's work or that the jury found it vicariously liable for JNET's

negligence in the performance of JNET's work. Instead, the jury apportioned

liability based on JNET's and Comcast's separate and distinct negligence. In our

view, the plain language of the policy does not support a finding that Comcast

is an additional insured for its own negligence under the circumstances

presented. The policy provides that Comcast is an additional insured "only with

respect to" JNET's work; it does not provide that Comcast is an additional

insured with respect to its own work or negligence. We must enforce the policy

as written and cannot interpret it to provide more coverage than that to which

Hanover and JNET agreed. Simonetti, 372 N.J. Super. at 428.

We are not persuaded by Comcast's and the court's reliance on our

decisions in Franklin Mutual Insurance Co. v. Security Indemnity Insurance Co.,

275 N.J. Super. 335 (App. Div. 1994), and Harrah's Atlantic City, Inc. v.

Harleysville Insurance Co., 288 N.J. Super. 152 (App. Div. 1996). In those

cases, we determined the scope of additional insured provisions different than

the one at issue here. In Franklin, the policy provided coverage to an additional

insured "only with respect to liability arising out of the ownership, maintenance

or use of that part of the premises," 275 N.J. Super. at 338-39, and in Harrah's

A-3245-17T4 11 the policy provided coverage to an additional insured "only with respect to

liability arising out of the . . . use of that part of the premises leased," 288 N.J.

Super. at 156 (alteration in original).

In those cases, coverage as an additional insured was dependent on the

proper construction of the term "arising out of the use" of defined premises. In

Franklin, we noted the analysis was founded on the "key phrase 'arising out of

the . . . use,'" 275 N.J. Super. at 340 (alteration in original), and in Harrah's we

observed the phrase "'arising out of the . . . use of' the . . . premises [was] not

capable of precise definition," 288 N.J. Super. at 157 (first alteration in original).

Thus, our analysis of the policies was limited to the proper interpretation of the

term "arising out of the use" of defined premises, and we concluded that the term

"broad[ly]" means "'originating from the use of' or 'growing out of the use of'

the premises." Franklin, 275 N.J. Super. at 340; see also Harrah's, 288 N.J.

Super. at 157. In our interpretation of the additional insured provisions, we

noted the significance of the term "arising out of" to support our broad

interpretation of the term "use" of the premises, finding that "[b]y using the

'arising out of . . .' phrase, the insurer . . . necessarily understood that it was

providing coverage to the [additional insured] against accidents occurring

A-3245-17T4 12 outside of the . . . premises." Harrah's, 288 N.J. Super. at 157 (second alteration

in original).

Here, the additional insured provision does not include the "arising out

of" language we found supported our broad interpretation of the "use of the

premises" provisions in Franklin and Harrah's, and we do not consider an

additional insured provision providing coverage based on the "use" of any

premises. To the contrary, the JNET policy expressly provided additional

insured coverage "only with respect to" JNET's work. That is, Comcast is an

additional insured only in reference to or in relation to JNET's work.

We are not convinced by Comcast's claim, and the motion court's finding,

that the policy is ambiguous and, for that reason, we should find Comcast is an

additional insured entitled to coverage for its own negligence. See Simonetti,

372 N.J. Super. at 428 ("If the controlling language of the policy will support

two meanings, one favorable to the insurer and one favorable to the insured, the

interpretation supporting coverage will be applied."); cf. Cruz-Mendez, 156 N.J.

at 571 (finding that ambiguities in insurance policies will ordinarily be resolved

in favor of the insured). The fact that the parties offer two conflicting

interpretations does not by itself give rise to an ambiguity. Rosario, 351 N.J.

Super. at 530-31. The test for determining whether a genuine ambiguity exists

A-3245-17T4 13 is whether the "phrasing of the policy is so confusing that the average

policyholder cannot make out the boundaries of coverage." Id. at 530 (quoting

Lee v. Gen. Accident Ins. Co., 337 N.J. Super. 509, 513 (App. Div. 2001)). For

the reasons noted, the policy provides no source of confusion here; Comcast is

an additional insured "only with respect to" JNET's work, but its liability was

not based on JNET's work. The jury found Comcast separately liable based on

its own negligence and with reference and relation to its own work.

In sum, we find the policy is not ambiguous and that its plain language

allows additional insured coverage only with respect to JNET's work. Because

Comcast's liability was not determined in reference to or in relation to JNET's

work, Comcast is not entitled to coverage as an additional insured for its own

negligent acts under the policy. We therefore reverse the court's orders granting

Comcast summary judgment on its claim for coverage under the policy and

denying Hanover's summary judgment motion dismissing Comcast's coverage

claim.

We also consider Comcast's appeal of the court's order denying its

summary judgment motion on its claim against JNET for breach of contract by

failing to obtain the insurance allegedly required under JNET's contract with

Comcast. As previously explained, the court did not address the merits of

A-3245-17T4 14 Comcast's motion because it concluded Comcast was entitled to insurance

coverage as an additional insured under the JNET policy and, as such, Comcast

could not succeed on its cause of action asserting JNET failed to provide the

requisite insurance.

Based on our determination that Comcast is not entitled to coverage under

the policy, the factual premise underlying the court's dismissal of Comcast's

breach of contract claim against JNET is no longer extant. We do not, however,

address the merits of Comcast's summary judgment motion. The motion court

did not make any findings of fact and conclusions of law on the motion. Estate

of Doerfler v. Fed. Ins. Co., 454 N.J. Super. 298, 301 (App. Div. 2018). In

addition, the record on appeal does not otherwise permit a de novo disposition

of the motion because the parties did not provide a complete set of the statement

of material facts and responses submitted to the motion court under Rule 4:46-

2(a) and (b). We therefore vacate the order denying Comcast's motion for

summary judgment on its breach of contract claim against JNET and remand for

the court to address the motion on the merits and for such other further

proceedings that may be appropriate.

Affirmed in part, vacated in part and remanded for further proceedings in

accordance with this opinion. We do not retain jurisdiction.

A-3245-17T4 15