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Diehl v. Cumberland Mut. Fire Ins. Co.

January 9, 1997


On appeal from the Superior Court of New Jersey, Law Division, Camden County.

Before Judges Landau, Wallace and Kimmelman. The opinion of the court was delivered by Wallace, Jr., J.A.D.

The opinion of the court was delivered by: Wallace

The opinion of the court was delivered by


The issue here requires us to determine whether coverage should be afforded under an automobile liability insurance policy or under a homeowner's insurance policy. The motion Judge found that the injury did not arise out of the use of an automobile and concluded that the homeowner's insurance policy provided coverage for personal liability to a third party. We disagree and reverse.

The facts are relatively simple. On December 26, 1989, Plaintiff Richard Diehl was driving away from his home when he noticed his brother George Diehl approaching in a pickup truck. Richard pulled over to the side of the road. He got out of his vehicle, walked around the rear of the truck and was bitten in the face by George's dog, which was in the open cargo area of the pickup truck. The truck was owned by Theresa Brown and insured by the New Jersey Automobile Full Insurance Underwriting Association by its servicing carrier, CSC Insurance Services (CSC). At the time of the incident, George resided with his mother who had homeowner's insurance with defendant Cumberland Mutual Fire Insurance Company (Cumberland).

On February 21, 1990, plaintiff's attorney gave Cumberland notice of the claim. Cumberland retained East Company to investigate the claim. Following the investigation, Cumberland denied coverage.

On July 31, 1991, plaintiff filed a complaint against George alleging negligence as a result of the dog bite. On August 1, 1991, unrelated to plaintiff's complaint, Cumberland gave CSC notice of the claim, alleging that CSC's insured's vehicle was used in the incident and requesting that CSC telephone their office to discuss the matter. CSC wrote to Cumberland that it would investigate to "determine coverage."

George was served with plaintiff's complaint on August 15, 1991. Neither he nor his mother forwarded a copy of the complaint to Cumberland. However, on August 26, 1991, plaintiff's counsel sent a copy of the complaint to Cumberland. In October 1991, Cumberland wrote to George's mother requesting a copy of the complaint, but she did not respond until March 1992. On April 16, 1992, Cumberland wrote to her denying coverage for failure to comply with conditions and provisions of the policy.

Plaintiff filed a motion to serve Cumberland and to enter default. On August 21, 1992, the court denied the motion to serve Cumberland and granted the motion to enter default against George. A proof hearing was held on December 16, 1992, and the court entered judgment in favor of Richard against George in the total amount of $55,085.72.

George, with the consent of his mother, assigned to Richard all of his claims against Cumberland for its refusal to defend and indemnify him for the dog bite complaint and judgment. Richard then filed a complaint against Cumberland for damages and for the refusal to defend. Cumberland filed its answer alleging that the claim does not arise from any covered loss.

In December 1993, plaintiff's counsel wrote to CSC, describing the accident and enclosing a copy of the complaint. CSC did not reply. On November 31, 1994, plaintiff filed a motion to amend the complaint to join CSC. The motion was granted. CSC filed its answer in March, 1995, raising various defenses, including lack of coverage. CSC and Cumberland each filed a motion for summary judgment based on lack of insurance coverage. After argument, the motion Judge granted CSC's motion and dismissed all claims against CSC on May 12, 1995. Plaintiff, who was not present at the argument, filed a motion for reconsideration of the order dismissing CSC from the action. On May 26, 1995, the court heard argument and denied plaintiff's motion for reconsideration. At the same hearing, the Judge denied Cumberland's motion for summary judgment. The motion Judge concluded that because a third party's injury caused by a dog sitting in the back of a vehicle does not arise out of a "use of the automobile" to trigger coverage of an automobile policy, Cumberland's homeowner's policy must provide coverage.

Plaintiff then filed a motion for summary judgment on liability. The motion Judge granted the motion on June 29, 1995. In July, plaintiff moved for summary judgment seeking an award of damages and counsel fees. On September 15, 1995, the motion Judge granted plaintiff's motion and entered judgment against Cumberland in the amount of $55,275.16 plus pre-judgment interest of $5,861.79 and counsel fees and costs of $2,590.

On appeal Cumberland contends that plaintiff's injuries are excluded from coverage under the homeowner's policy because they are ...

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