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Acceptance Insurance Co. v. Woodstock 99


June 18, 2007


On appeal from Superior Court of New Jersey, Law Division, Essex County, Docket No. ESX-L-3151-05.

Per curiam.


Submitted May 30, 2007

Before Judges Weissbard and Lihotz.

Plaintiff, Acceptance Insurance Company, as subrogee of Upfront, Inc., appeals from a summary judgment dismissing its complaint against defendant, Woodstock 99, LLC. We affirm.

The case arises from damage to staging and fencing equipment owned by Upfront and leased to defendant for use in an outdoor concert known as "Woodstock 99" that took place at Griffiss Air Force Base located in Oneida, New York during July 1999.

In connection with this transaction, Upfront and defendant entered into two separate contracts, both entitled "Service Agreement." The first of these Service Agreements (the Staging Agreement) provided that Upfront will "provide, construct and dismantle on behalf of Client an outdoor stage with a roof, in conformance with the specifications set out in Schedule A hereto." The second Service Agreement (the Fencing Agreement) stated that Upfront will "provide, construct and dismantle on behalf of Client an outdoor wall (alternately described as fence)."

Both the Staging and Fencing Agreements contained the following provisions. Paragraph 11 of the Staging Agreement and Paragraph 12 of the Fencing Agreement provided that:

In the event that any item of Construction Equipment becomes lost, stolen, destroyed or damaged or in the event of any condemnation, confiscation, theft or seizure or requisition of title to or use of such items (hereinafter referred to as an "Event of Loss"), Client [Woodstock 99] shall promptly give Upfront notice thereof. Client hereby assumes and shall bear the entire risk from an Event of Loss arising from the acts, omissions or negligence on the part of Client's employees, representatives, invitees or agents. Client shall not be entitled to any offset, set-off or any other reduction whatsoever from the Fees owed hereunder as a result of any such Event of Loss.

Paragraph 15 of both Agreements dealt with Indemnification. These paragraphs provided that defendant shall defend and indemnify Upfront with respect to any and all liabilities, claims, losses and damages arising from any breach by defendant to perform both Agreements or from any accident, injury or damage caused to any person, or to the property of any person, "including any claim by a third party in connection with damage to the Structure [or Stage], the Construction Equipment [or the Staging Equipment] or Client's property located thereon or property of any other person on or around the Structure [or Stage]."

Additionally, both Agreements provided that "[t]he Rider and Schedules attached hereto or referred to herein are incorporated herein and made a part hereof for all purposes. As used herein, the expression 'this Agreement' means this document and such Rider and Schedules." Attached to the Agreements is a Rider designated as "Exhibit A" and entitled "Required Compliance Language" (the Rider).

The Rider, which refers to defendant as operator and Upfront as contractor, covers a variety of topics, the most important of which, at least in terms of this appeal, deals with insurance. That clause reads as follows:

Contractor [Upfront] shall obtain insurance coverage, and shall provide evidence of such insurance as follows. All insurance shall waive subrogation against any of the Indemnities [sic] and shall name the Indemnities [sic] as additional insureds:

Property insurance coverage against loss or damage in an amount not less than One Hundred Percent (%100) of the full replacement cost of all personal property brought on to the site, including coverage in connection with any construction or work which Contractor or its sublicensees may perform; Commercial General Liability Insurance with a limit of no less than $5 million per occurrence, insuring against bodily injury, including death, personal injury and property damage caused by Contractor and/or the third parties. [(emphasis added).]

The Agreements, in addition to the Riders, were all signed by Richard Falana, President of Upfront, the Rider having been signed on June 16, 1999.

During the concert, many of the attendees rioted and equipment leased to defendant was destroyed. Plaintiff, Acceptance, as property insurer for the damaged equipment, paid coverage benefits to Upfront for the damaged equipment in the amount of $74,861.71. Plaintiff now seeks to recoup that money from defendant as a subrogee of Upfront.

On cross-motions for summary judgment, Judge Giles found the waiver of subrogation provision in the Rider to be applicable, barring plaintiff's subrogation action. On appeal, plaintiff argues that there were fact questions in dispute that precluded summary judgment.*fn1 Plaintiff contends that the Rider, which the judge found controlling, "was only a secondary part of the contract", and that the "language in the main part of the contract was ignored".

We have reviewed plaintiff's argument in light of the record and applicable New York substantive law and find its contention to be without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(A). The case posed a question of law for the court concerning contract interpretation and was ripe for summary judgment. We affirm substantially for the reasons expressed by Judge Giles in his oral opinion of July 28, 2006.


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