Seidman, J.c.c. (temporarily assigned).
Plaintiff, Karadis Bros. Painting Co., Inc. (Karadis), brings this declaratory judgment action to determine whether a policy of liability insurance issued to it by defendant Pennsylvania National Mutual Insurance Company (insurer) obligates the insurer to defend a third-party complaint in a lawsuit now pending in the Law Division, and to pay, within the limits of coverage, any judgment that may be rendered therein against the insured.
Other defendants, whose involvement will appear hereinafter, are Skyclimber, Inc.; Western Gear Corporation; Moulton Ladder Co.; and Anne J. Smythe, administratrix ad prosequendum of the estate of John Patrick Smythe, deceased.
Counsel have agreed to submit the issues to the Court for determination on the basis of the pleadings and memoranda of law.
These proceedings are the outgrowth of a death action instituted in the Law Division, Burlington County. The complaint in that suit relates, in substance, that, on October 17, 1969, John Patrick Smythe, an employee of Karadis, a contractor engaged to paint a water tower in Willingboro, was working on a scaffold attached to a mechanized hoist; and that, allegedly because of negligence in the design and manufacture of the hoist and in its maintenance, the scaffold collapsed, causing Smythe to fall to his death. It is asserted that Karadis was utilizing at the time a motor hoist device leased from Moulton Ladder Co. and manufactured and distributed by Skyclimber, Inc., a subsidiary of Western Gear Corporation. The complaint charges Skyclimber, Inc., Western Gear Corporation, and Moulton Ladder Co. with negligence and breach of warranty. In addition, it is alleged that Moulton Ladder Co. failed to inspect, maintain and repair the hoisting device. Karadis was not joined as a defendant, presumably because the decedent was its employee.
In their answer, Skyclimber, Inc., and Western Gear Corporation crossclaimed against Moulton Ladder Co. for contribution under the Joint Tortfeasors Act and for indemnification both on the theory of "vicarious liability" and under a written "hold harmless" agreement.
Moulton Ladder Co. filed a third party complaint seeking indemnification from Karadis for any adverse judgment that might be recovered in the lawsuit. The first two counts are based upon "hold harmless" provisions of the rental agreement between it and Karadis. The third count claims a breach by Karadis of its alleged contractual obligation to supply insurance coverage for the lessor.
The existence of a general liability policy is not disputed; however, the insurer denies coverage and refuses to defend the third party complaint on the ground that the obligations,
if any, of its insured to indemnify Moulton Ladder Co. are contractual ones excluded from the policy.
On September 30, 1969, Moulton Ladder Co. and Karadis executed a "Rental Contract and Receipt Form" whereby Skyclimber hoisting equipment was leased to Karadis to be used at a location described as "Willingboro Water Tank." The equipment consists of motorized hoisting devices attached to each side of a scaffold and operating on suspended wire ropes fastened to the top of the structure.
Among the terms and conditions contained in the rental agreement are two paragraphs which provide, in ...