Lind v. Insurance Co. of N. Am., 174 N.J. Super. 363, 369, 416 A.2d 922 (Law Div. 1980), aff'd, 193 N.J. Super. 303, 473 A.2d 981 (App. Div. 1983). Failure of the insurer to make payment under these circumstances prevents the insurer from invoking the suit limitations provision. Bowler, 53 N.J. at 328. In contrast, if there is "reasonable doubt as to whether the evidence is sufficient to require payment," the insurer cannot be silent but must notify the insured of its decision to deny coverage. Id.
This case present the facts to support the latter. While defendant Generali believes that the "Other Insurance" clauses contained in both policies render the insurers co-primary, defendant General Star believes that Generali's policy must be exhausted before its policy is triggered. This is a legal dispute which requires the intervention and expertise of the Court. Therefore, defendant General Star could not have known that plaintiff was clearly due monies under the policy. Accordingly, defendant General Star properly and timely notified plaintiff of its decision not to pay the claim. The Court finds, therefore, that defendant General Star should not be equitably estopped from asserting the suit limitations provision.
II. Where Do We Go From Here?
Finally, plaintiff argues that if the Court finds that defendant General Star cannot be held liable for the loss, defendant Generali should be required to pay the balance of the claim. The Court, however, has not determined that General Star was not, at one time, liable for the claim. Rather, the Court concludes that plaintiff, through its own lack of due diligence, is time barred from pursuing its claim against defendant General Star. The following issues still remain: (1) whether plaintiff can maintain a cause of action against defendant Generali for the balance of the claim, i.e., whether the "Other Insurance" provisions of the policies mandate that the two insurance companies be treated as co-primary insurers or whether the terms of the insurance policies mandate that a blanket policy is excessive to a more specific policy, and (2) whether defendant Generali may assert a cross-claim against defendant General Star for contribution or indemnification although plaintiff's claim is time barred. In light of the Court's decision regarding the suit limitations provision, these issues require more in-depth analysis by the parties.
For the foregoing reasons, plaintiff's motion as against defendant General Star is DENIED WITH PREJUDICE, and defendant General Star's motion is GRANTED. The parties are instructed to brief the issues referenced above. The parties shall submit to the Court within ten days of this Opinion a mutually agreed upon briefing schedule, and refile the motions pursuant to Local Rule 12N.
An appropriate Order accompanies this Opinion.
NICHOLAS H. POLITAN
This matter having come before the Court on the cross-motions for summary judgment of plaintiff ALI, Inc. and defendant General Star Indemnity Company, and the motion of defendant Generali for contribution or indemnification from defendant General Star, and the Court having heard oral argument on January 27, 1997, and having considered the matter including the submissions of the parties, and for the reasons appearing more particularly in the Letter Opinion of this Court in the above-captioned matter, and good cause having been shown,
IT IS on this 5th day of February, 1997, hereby
ORDERED that defendant General Star's motion for summary judgment against plaintiff is GRANTED, and it is further
ORDERED that plaintiff's motion for summary judgment against defendant General Star is DENIED WITH PREJUDICE, and it is further
ORDERED that plaintiff's motion for summary judgment against defendant Generali is DENIED WITHOUT PREJUDICE, and it is further
ORDERED that defendant Generali's motion for contribution or indemnification from defendant General Star is DENIED WITHOUT PREJUDICE, and it is further
ORDERED that the parties are directed to brief the issues referenced in the Letter Opinion of this Court in the above-captioned matter, and shall submit to the Court within ten days of this Order a mutually agreed upon briefing schedule pursuant to Local Rule 12N.
NICHOLAS H. POLITAN