On appeal from Superior Court of New Jersey, Law Division, Essex County, L-10214-95.
Before Judges Skillman, Carchman and Wells.
The opinion of the court was delivered by: Carchman, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 11, 2001
This appeal again presents an issue as to the scope of the loading and unloading doctrine and the allocation of responsibility for damages for personal injury arising from the use of a product or goods as between the liability coverage of a product manufacturer and the automobile coverage of the trucking company involved in the unloading of the product. Relying on the Supreme Court's decision in Kennedy v. Jefferson Smurfit Co., 147 N.J. 394 (1997), the motion judge concluded that despite the fact that the goods had been unloaded from a truck to a loading dock, the unloading process had not been completed, and the trucking company was obligated to provide a defense and indemnification for injuries resulting from an accident occurring while the product was being moved from a loading dock to a storage area. We disagree and conclude that under the facts presented here, the unloading process had been completed, and the responsibility for coverage remained with the product manufacturer.
The relevant facts adduced during cross-motions for summary judgment were not in significant dispute. Plaintiff William Pisaneschi was employed by Air Systems, Inc. (Air Systems), which had subcontracted with the general contractor, defendant Turner Construction Co., to supply, deliver and install air conditioning equipment for a renovation project on the premises of defendant New Jersey Institute of Technology (NJIT). The equipment for the NJIT job was manufactured by defendant Liebert Corporation (Liebert) and purchased by Air Systems from a local distributor. Liebert packaged each of the six 300-pound air conditioning units for shipment from its Ohio facility by placing them into individual corrugated cardboard boxes and strapping each box to a separate wooden pallet with two one-half-inch wide black plastic straps. Air Systems ultimately received the units in its Kenilworth shipping yard, where the units were loaded onto an Air Systems rack truck and transported to the NJIT job site. There, plaintiff and his fellow employees off-loaded the units onto the loading dock.
After an Air Systems' employee moved the truck away from the dock, plaintiff began pushing and pulling one of the packages to a storage area, so as to align its pallet for pick-up by a pallet jack or forklift. As plaintiff was attempting to move or rotate the package, one of the plastic straps broke, and plaintiff fell and was injured.
Air Systems maintains an automobile liability policy with third-party defendant Pennsylvania National Mutual Casualty Company (Penn). The policy includes an omnibus loading/unloading provision providing liability coverage to additional users of the insured vehicle.
Following the accident, plaintiff filed an action in the Law Division seeking damages based on strict liability and breach of express and implied warranties. After filing an answer to plaintiff's complaint, Liebert filed a third-party complaint against Penn seeking a declaratory judgment requiring Penn to defend and indemnify Liebert against plaintiff's claims as an additional insured under the loading/unloading provision of Air Systems' motor vehicle insurance policy.
The parties cross-moved for summary judgment. Penn claimed that Liebert was not an additional insured under the policy because: (1) the truck was completely unloaded by the time this incident occurred, and the air handling units were at their final destination; (2) plaintiff's complaint sounded in product liability, rather than alleging negligence on the part of any Liebert employee in loading or unloading the Air Systems truck; and (3) Liebert was not "using" Air Systems' truck at the time of the accident, and, therefore, could not be considered an additional insured under Air Systems' Penn policy. Liebert contended that it was entitled to summary judgment because:
(1) the unit had not yet been moved from the loading dock to its delivery destination within the building when the accident occurred; (2) under Kennedy, Liebert's claim would be covered by Penn's policy whether plaintiff's defective packaging claim sounded in negligence or product liability; and (3) Liebert "used" the Air Systems' vehicle because it had packaged its goods for shipping.
The motion judge denied Penn's motion, granted Liebert's and determined that Liebert was entitled to coverage under the Penn policy. He concluded that the unloading process was not yet complete when the accident occurred and stated:
At the time of the accident it's undisputed that all six units had been taken off the truck onto the landing dock, and furthermore that four of those units had been taken by the Air Systems employees to other parts of the building . . . . It is undisputed . . . that the Air Systems truck was pulled away some short distance from the loading dock. Thereafter . . . plaintiff . . . was moving an air handling ...