Gaulkin, Sullivan and Foley. The opinion of the court was delivered by Gaulkin, J.A.D.
Plaintiff appeals from a declaratory judgment entered in the Superior Court, Law Division, Bergen County, in favor of defendant (Hartford) that the latter's policy does not cover the accident hereafter mentioned.
On July 12, 1957 a "jeep," owned by Castle Auto Service (Castle) and driven by one Hogan, overturned and injured Hanlon, an employee of Castle, and four other occupants of the jeep. The Hartford policy named Castle as its insured, and contained the usual clause extending the insurance to anyone using the jeep with the permission of the named insured.
Although Royal's complaint acknowledged that its policy covered Hogan while driving the jeep, which he did not own, it sought a declaratory judgment that:
"The defendant's policy of insurance is the primary liability coverage for the claims of injury sustained in the accident and the plaintiff's policy of insurance is excess or, in the alternative, that plaintiff's policy is other insurance and shall only bear that proportion of any loss which its limit of liability bears to all valid and collectible insurance."
Hartford in its answer denied that its policy covered at all, because:
"* * * Donald Hogan is not an insured within the policy of insurance with Richard Ransom and Jack Taylor doing business as Castle Auto Service. The policy of insurance specifically states that the actual use of the automobile must be by the named insured or with his permission, and neither condition had been complied with."
The trial court found that defendant's contention was supported by the proofs and entered judgment accordingly.
When the appeal reached this court, observing that none of those injured had been joined as parties, we requested that at the oral argument counsel be prepared to give us their views as to the effect of this omission. Counsel did so fully and frankly. While doing so they told us that those injured can be served with process in New Jersey; that the action of one of those injured has been settled by plaintiff; that two other actions are still pending in Bergen County; and that the others injured are infants who still may, and very likely will, sue. They admitted that none of the injured claimants is bound by the judgment appealed from, so that if one or more of them sues Hartford the issues tendered by the pleadings below, which the judgment was designed to adjudicate, will have to be litigated anew. Moreover, Royal contends that, if it is sued by one of the injured upon a judgment recovered against Hogan, it would assert that the declaratory judgment is not res judicata , and that it still has the right to argue that Hartford's policy is primary or at least concurrent insurance. There is authority to the contrary (Wright v. Schick , 134 Ohio St. 193, 16 N.E. 2 d 321, 121 A.L.R. 882 (Sup. Ct. 1938); Ohio Casualty Ins. Co. v. Gordon , 95 F.2d 605 (10 Cir. 1938)), but it is doubtful whether even that question may properly be decided in the absence of the injured parties.
In short, the judgment below raises many problems and solves none. Under the circumstances here present, the case should not have proceeded to judgment without the joinder of those injured. Finley v. Factory Mutual Liability
Ins. Co. of America , 38 N.J. Super. 390 (Law Div. 1955); cf. Condenser Service and Engineering Co., Inc. v. American Mutual Liability Ins. Co. , 45 N.J. Super. 31 (App. Div. 1957). In an article, " Developments in the Law -- Multi ...