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Westinghouse Electric Corp. v. Liberty Mutual Insurance Co.

Decided: May 15, 1989.

WESTINGHOUSE ELECTRIC CORPORATION AND THERMO KING CORPORATION, CORPORATIONS, PLAINTIFFS-APPELLANTS,
v.
LIBERTY MUTUAL INSURANCE COMPANY, ET AL., DEFENDANTS-RESPONDENTS. WESTINGHOUSE ELECTRIC CORPORATION, A CORPORATION, PLAINTIFF-APPELLANT, V. THE AETNA CASUALTY AND SURETY COMPANY, ET AL., DEFENDANTS-RESPONDENTS



On appeal from the Superior Court, Law Division, Union County, whose opinion is reported at 227 N.J. Super. 504 (Law Div. 1988).

Pressler, O'Brien and Stern. The opinion of the court was delivered by Pressler, P.J.A.D.

Pressler

Plaintiff Westinghouse Electric Corporation appeals, on leave granted, from an order of the Law Division severing a substantial portion of its comprehensive declaratory judgment actions against its liability and property damage insurers and dismissing, on forum non conveniens grounds, all claims for coverage made by it arising out of events which occurred outside of the State of New Jersey. We reverse.

Plaintiff Westinghouse Electric Corporation,*fn1 a multi-dimensional industrial giant doing business both throughout the United States and abroad, brought two declaratory judgment actions in the Superior Court, Law Division, against the 144 insurers, both American and Foreign, who participated between 1948 and 1982 in providing it, through some 300 policies issued by primary and excess carriers, with an integrated, comprehensive liability and property-damage insurance program covering the risks of its business operations, wherever conducted. Some two hundred million dollars of coverage is involved. There is

no question of the court's in personam jurisdiction over all parties.

In Westinghouse v. Aetna Casualty & Surety Co., et al., the so-called toxic tort case, plaintiff seeks a declaration of coverage under its comprehensive general liability policies for some 3,000 claims made against it by persons asserting that they have sustained injury as a result of exposure to asbestos, welding fumes, polychlorinated biphenyls (PCBs), and other substances for which Westinghouse is alleged to be responsible. Of these claims, 128 have been filed in New Jersey. In Westinghouse v. Liberty Mutual Insurance Company, et al., the so-called environmental-claims case, plaintiff seeks coverage both from its liability carriers and its property damage carriers for losses it has sustained or may sustain arising out of industrial activities which are alleged by federal and state environmental control agencies and by private entities to have resulted in both on- and off-site environmental contamination. These claims encompass 81 sites located in 23 states. Of these sites, 56 are non-owned and generally involve disposal thereon of waste generated by plaintiff's industrial activities conducted on the remaining sites. Nine of the 81 sites, including two owned sites and seven non-owned sites, are located in New Jersey. All 144 defendant insurers have disclaimed.

The actions are still in their most preliminary stage, and insofar as we can determine from this record, no substantive rulings have yet been made. The focus of the litigation is still on its scope, and that is the issue which now engages us. In sum, the issue is whether there will be a single comprehensive trial of the coverage question or whether Westinghouse will be forced to litigate the coverage question repeatedly in every state of the union in which a toxic tort claim or an environmental claim has been made against it.

Westinghouse and a group of 89 defendants, identified as the

Liberty Mutual Group,*fn2 take the position that a single comprehensive coverage action is mandated in the circumstances here. The threshold dispute between plaintiff and these defendants involves only the question of the forum in which this comprehensive litigation should be conducted, whether the Superior Court of New Jersey or the Federal District Court for the Western District of Pennsylvania, an alternative we will address in greater detail hereafter. The so-called Lumbermens group, consisting of about 14 insurers,*fn3 takes the position that the coverage question must be separately litigated in each state in which a claim against Westinghouse is made, and Lumbermens, to demonstrate its point, instituted, after the filing of these actions, reactive actions in South Carolina, North Carolina, Ohio, California, Louisiana and Virginia seeking a no-coverage declaration against Westinghouse. These have since been stayed. As we understand the record, the remaining defendants take no scope position.

The trial judge consolidated the two cases for purposes of the scope determination and, in an opinion reported at 227 N.J. Super. 504 (Law Div.1988), concluded that the doctrine of forum non conveniens requires the limitation of the coverage action to the claims made by Westinghouse against its insurers which arise out of New Jersey sites and New Jersey toxic torts suits.

We note preliminarily that although we disagree with the trial judge's view of the matter and although we conclude that the forum non conveniens doctrine is inapposite, at least at this early stage of the litigation, we nevertheless recognize that the litigation as presently postured is inordinately complex and that its conduct will pose formidable procedural problems which will surely challenge the outer limits of judicial case management as presently practiced. We are nevertheless convinced that the trial courts of this state have available to them both the basic techniques and the judicial skill in implementing them which are necessary for successfully and expeditiously managing a case of these proportions consistently with the administration of justice both for the litigants and for the judicial system as a whole. Our fundamental perception is that the trial judge resorted to the forum non conveniens theory as a case management technique. We believe, however, that cases, even cases as difficult and cumbersome as this one, cannot be "managed" by the simple expedient of dismissing them or parts of them. We must, as a judicial system, devote our efforts to determining how best to adjudicate controversies on their merits, not how to avoid adjudication. Westinghouse, it is true, is not a New Jersey corporation. It is incorporated and has its principal office in Pittsburgh, Pennsylvania. Nevertheless, as the trial judge pointed out, its

presence in New Jersey is significant. It employs over 1,000 people in this State and paid more than $1.5 million in taxes to state and local governments in 1986. Westinghouse owns over 250 acres of property in this State, including its elevator division in Morristown and its apparatus service center in Hillside. [227 N.J. Super. at 507]

There can be no doubt that the economic prosperity we enjoy in this State is in large measure attributable to major national corporations which, like Westinghouse, are incorporated elsewhere but engage in substantial business activity here, employ our residents, and contribute to our tax base. There is no question that they are entitled, as are all our citizens, to as full an access to our court system as is consistent with fundamental principles of acquiring and exercising jurisdiction.

It is with this essential proposition in mind that we consider the scope issues before us. First, with respect to forum non conveniens, we note initially that it is an equitable doctrine of long standing predicated upon the basic notion that if more than one forum is available for the conduct of particular litigation, the court of the forum of plaintiff's choice has the discretion to require the litigation to be conducted in the other forum if the plaintiff's chosen forum is demonstrably inappropriate, that is, if a "clear showing of real hardship or * * * compelling reason" is made. Civic Southern Factors v. Bonat, 65 N.J. 329, 333 (1974). The determination of whether the objector to plaintiff's choice of forum has succeeded in meeting this demanding standard ordinarily requires the weighing of both private interest factors, that is, the considerations affecting the parties themselves in the litigation context, and public interest factors, that is, the considerations affecting the administration of the court system. These include such matters as location of witnesses, accessibility of proofs, the relative state of calendar congestion, and the strength of the local-interest nexus as mandating or not the undertaking of the litigation burden. See generally D'Agostino v. Johnson & Johnson, Inc., 225 N.J. Super. 250 (App.Div.1988), certif. granted 113 N.J. 369 (1988). In customary forum non conveniens terms then, the inquiry focuses upon the comparative appropriateness of several forums and the ultimate determination is the manifest inappropriateness, or not, of plaintiff's choice among them.

That, of course, is not the context in which the forum non conveniens doctrine was applied here. The issue was not dealt with in terms of whether there was an alternate and manifestly more appropriate forum for this litigation as plaintiff framed it. Rather, the court undertook to decide, in the name of forum non conveniens, whether plaintiff should be allowed, at least in this jurisdiction, to conduct a comprehensive action in order to obtain a single, comprehensive, definitive adjudication of its ...


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