This cause was submitted for determination upon a stipulation of facts read into the record at the final hearing. In addition thereto exhibits were introduced into evidence, briefs were submitted and oral argument was heard. Some of the named defendants did not appear at the final hearing but have agreed to abide by the judgment of the court.
Defendant Wiley McClinton was issued a Manufacturers' and Contractors' Liability Policy, MCS 5-1782, by plaintiff American Policyholders' Insurance Company for the one-year period beginning February 15, 1963. During such period Wiley McClinton was engaged in the plumbing business.
In April or May of 1963, the defendant Wiley McClinton installed a boiler at the premises of Crest Jewelry Company, 160 Mt. Pleasant Avenue, Newark, N.J. On November 4, 1963 Wiley McClinton, Jr., who was apparently employed by and working for his father, changed the thermostat on the boiler previously installed by his father. Sometime later the same day, after the thermostat had been changed, the boiler exploded causing personal injury to the employees of Crest Jewelry Company. A number of suits in the Law
Division arose out of these events, Wiley McClinton, Sr. and his son both being named as defendants.
Following plaintiff's timely notice of the accident and its conduct of an investigation, plaintiff disclaimed liability on the two grounds that the insurance purchased under Policy MCS 5-1782 did not afford coverage for "Products Liability" or "Completed Operations," and that another provision expressly excluded this kind of accident from the "Premises-Operations" coverage of said policy. Consequently, plaintiff believes it has no duty under the policy to defend the McClintons in the Law Division actions.
This declaratory judgment action is brought to determine whether or not plaintiff is obligated to defend Wiley McClinton and Wiley McClinton, Jr. in the various Law Division actions instituted against them, and whether or not the policy affords coverage to the McClintons for any liability which may arise out of the accident of November 4, 1963.
The "Declarations" appear on the front page of this standard form "Manufacturers' and Contractors' Policy" and include a number of sub-headings entitled "Item[s]." Item 1 contains the name of the insured, Wiley McClinton, and his address. Item 3 reads:
" The insurance afforded is only with respect to such and so many of the following coverages and divisions thereunder as are indicated by specific premium charge or charges. The limit of the company's liability against each such coverage and division shall be as stated herein, subject to all the terms of this policy having reference thereto." (Emphasis supplied).
PREMIUMS LIMITS OF LIABILITY DIVISIONS COVERAGES
$18.84 $10,000 each person 1. Premises -- Operations
$20,000 each accident 2. Elevators A Bodily injury
aggregate 3. Independent Liability
(Aggregate applies to 4. Products -- Completed
$29.88 $5,000 each accident 1. Premises ...