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Murawski v. CNA Insurance Co.

June 6, 2005

THOMAS MURAWSKI, PLAINTIFF-APPELLANT,
v.
CNA INSURANCE COMPANY, DEFENDANT-RESPONDENT.



On certification to the Superior Court, Appellate Division.

SYLLABUS BY THE COURT

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

[NOTE: This is a companion case to Pinto v. New Jersey Manufacturers Insurance Company, et al. also decided today]

This appeal involves the application of an underinsured motorist (UIM) step-down clause in an employer's business automobile policy to a case in which an employee has been injured in a covered vehicle in a work-related accident.

Thomas Murawski sustained serious personal injuries on March 14, 2000, when the truck in which he was riding was struck by a vehicle driven by Rufus Howard. The accident took place during the course of Murawski's employment for Belafsky Roofing and Sheet Metal Company (Belafsky), in a truck owned by Belafsky. Murawski settled the claim with Howard for the $50,000 liability limit of Howard's personal automobile insurance policy and then sought UIM coverage under Belafsky's CNA policy.

The CNA policy provided UIM coverage of one million dollars for named insureds. Murawski was not listed as a "named insured" on the policy nor was he otherwise identified anywhere in the policy. The named insureds on the CNA policy were two corporate entities. Murawski was an "insured" under the CNA policy for purposes of UIM coverage because he was occupying a covered auto at the time of the accident. Although Murawski did not own a vehicle and was not a licensed driver (and thus did not have his own automobile insurance policy), CNA claimed that the step-down provision governing "insureds" applied to Murawski because Murawski was insured as a resident relative under his mother's Allstate automobile policy, which carried a UIM limit of $100,000. Thus, CNA sought to demonstrate that Murawski maintained a dual residency, living both with his girlfriend and with his mother, and accordingly the "limit of liability" for UIM coverage under the employer's policy should be stepped-down to $100,000, the amount of coverage under the mother's policy.

Murawski filed a motion for summary judgment alleging that the policy was ambiguous in respect of his status as a "named insured." The trial court found ambiguity and resolved the ambiguity in respect of who was intended to be covered as a "named insured" in favor of Murawski. The Appellate Division reversed and remanded the case for further proceedings on whether Murawski resided with his mother so as to satisfy the "family member" criterion of the step-down provision.

The Court granted Murawski's petition for certification.

Held: For the reasons expressed in Pinto, we affirm the enforceability in general of step-down provisions in respect of UIM coverage, provided the insurance contract language is clear. Murawski was not a "named insured" nor could he reasonably have expected to be based on the policy's language.

1. The declaration sheet of the CNA policy provided UIM coverage of one million dollars for named insureds. Murawski was not listed as a "named insured" on the policy nor was he otherwise identified anywhere in the policy. The named insureds on the CNA policy were two corporate entities. On these facts, as in Pinto, we hold that Murawski was not a "named insured" nor could he reasonably have expected to be based on the policy's language. (p. 3)

Judgment of the Appellate Division is AFFIRMED. The matter is REMANDED to the Law Division.

JUSTICE ZAZZALI filed a separate DISSENTING opinion in which JUSTICE ALBIN joins. It simply may not be possible for a company in the construction industry to designate an employee as a named insured; accordingly, the failure to name individual employees in the policy does not suggest that the company intended to limit coverage for its employees and so the Court should construe the policy's reference to the corporations as the named insureds to encompass all of the corporations' current employees on a given date.

CHIEF JUSTICE PORITZ and JUSTICES LaVECCHIA, WALLACE and RIVERA-SOTO join in this opinion. JUSTICE ZAZZALI filed a separate dissenting opinion in which JUSTICE ...


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