July 23, 2007
JUAN PEREZ, PLAINTIFF,
EL BAMBOO BAR/CLUB, DEFENDANT-THIRD-PARTY PLAINTIFF-APPELLANT,
ALEA LONDON LTD., THIRD-PARTY DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-5370-04.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted July 3, 2007
Before Judges Parker and Seltzer.
Third-party plaintiff, El Bamboo Bar and Club, Inc.*fn1 (El Bamboo) appeals from an order entered on July 21, 2006, granting summary judgment dismissing its complaint against its insurer, ALEA London, Ltd. (ALEA), seeking to compel ALEA to provide a defense against a claim by a patron that he had been injured as a result of El Bamboo's failure to "provide a safe environment for its patrons." We affirm.
Juan Perez filed a complaint on July 2, 2004, alleging that he was a patron of El Bamboo. He claimed that as a result of the El Bamboo's failure "to monitor its patrons for dangerous weapons," he was shot and injured. El Bamboo was insured by ALEA under a general liability insurance policy. When ALEA, claiming a provision of the policy excluded coverage for the events described in Perez's complaint, refused to defend that complaint, El Bamboo filed a third-party action seeking to compel a defense. The judge agreed that the exclusion excused ALEA from defending the claim and dismissed the third-party complaint. El Bamboo, thereafter, settled with Perez and this appeal followed.
The facts are not in dispute. Perez alleged in his complaint that El Bamboo "negligently, recklessly and/or carelessly failed to adequately provide a safe environment for its patrons. Specifically, the defendant El Bamboo Bar/Club failed to monitor its patrons for dangerous weapons. Said failure caused the plaintiff to be shot while a patron at El Bamboo Bar/Club." The policy in effect provided insurance against "bodily injury" if caused by an "occurrence" within the "coverage territory." ALEA does not dispute that in the absence of an exclusion, it would be required to defend the claim of Perez and, were Perez successful, to pay the resulting damages to the policy limit. ALEA, however, claims that its responsibility is excused by virtue of an exclusion. That exclusion provides:
ASSAULT AND/OR BATTERY EXCLUSION:
This insurance does not apply to any claim arising out of:
A. Assault and/or Battery committed by any person whosoever, regardless of degree of culpability or intent and whether the acts are alleged to have been committed by the insured or any officer, agent, servant or employee of the insured or by any other person; or
B. Any actual or alleged negligent act or omission in the:
4. Reporting to the proper authorities or failure to so report; or
5. Retention of a person for whom any insured is or ever was legally responsible, which results in Assault and/or Battery; or
C. Any actual or alleged negligent act or omission in the Preventive or suppression of any act of Assault and/or Battery.
The motion judge found this clause clearly and unambiguously excluded the coverage for the incident alleged in the complaint and dismissed the third-party complaint.
Because this decision was reached by summary judgment, we apply the same standard utilized by the motion judge to resolve the issue, Prudential Prop. & Cas. Ins. Co. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998), without affording any special deference to the judge's interpretation of the law. Balsamides v. Protameen Chems., Inc., 160 N.J. 352, 372 (1999); Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).
The principles by which this dispute must be resolved are well settled:
The starting point in evaluating any claim that an insurer has breached a duty to defend its insured in litigation must be the policy of insurance. The duty to defend is not a product of statute or of common law. It is solely a contractual undertaking of the insurer and it can be as limited or as broad as the insurer sees fit to provide through its policy. Indeed, an insurance policy may provide indemnification for loss without any duty to defend litigation. Therefore, the source for any claim [of a breach of the] duty to defend must be those provisions of the policy of insurance . . . which delineate the scope of that duty.
[Hartford Accident & Indem. Co. v. Aetna Life & Cas. Ins. Co., 98 N.J. 18, 22 (1984).]
The policy issued to El Bamboo provided that ALEA had "no duty to defend the insured against any 'suit' seeking damages for 'bodily injury' . . . to which this insurance does not apply." Accordingly, determining whether the ALEA was required to defend the Perez complaint requires a comparison of the complaint for which a defense is sought with the underlying policy.
When determining whether an insurance carrier has a duty to defend:
[T]he complaint should be laid alongside the policy and a determination made as to whether, if the allegations are sustained, the insurer will be required to pay the resulting judgment, and in reaching a conclusion, doubts should be resolved in favor of the insured.
[Danek v. Hommer, 28 N.J. Super. 68, 77 (App. Div. 1953), aff'd o.b., 15 N.J. 573 (1954) (citing Appleman, Insurance Law and Practice, § 4683, 1953 Pocket Part).]
"The duty to defend comes into being when the complaint states a claim constituting a risk insured against." Ibid. "Stated another way, the duty to defend extends only to claims on which there would be a duty to indemnify in the event of a judgment adverse to the insured." Hartford Acc. & Indem. Co.[, supra, 98 N.J. at 22]. Trs. of Princeton Univ. v. Aetna Cas. and Sur. Co., 293 N.J. Super. 296, 301 (App. Div. 1996).]
Our review of the policy issued by ALEA to El Bamboo convinces us that there would be no requirement for ALEA to pay any sums on behalf of El Bamboo were Perez to be successful. The complaint alleges a failure to provide a safe environment for Perez by virtue of a failure to monitor El Bamboo's patrons for dangerous weapons. That allegation is tantamount to an allegation that El Bamboo was negligent "in the prevent[ing] or suppress[ing] of any act of Assault and/or Battery." But liability for such a failure to prevent or suppress an assault is unambiguously excluded from coverage.
El Bamboo's reliance on L.C.S., Inc. v. Lexington Ins. Co., 371 N.J. Super. 482 (App. Div. 2004), is misplaced. The exclusion at issue in L.C.S. related to claims involving negligent hiring, supervision, or retention of the assaulter and, therefore, did not excuse coverage of a claim relating directly to an action of an employee. Id. at 489. The exclusion at issue here excuses coverage for any claim arising out of the acts of El Bamboo in failing to prevent or suppress an assault and battery.
El Bamboo also asserts that the allegations of the complaint "did not arise out of the assault." We need not resolve that question because the allegations of the complaint clearly arose out of the failure of El Bamboo to prevent or suppress the assault, a failure which is specifically addressed in the exclusion.
Since there was no coverage for the acts alleged in the complaint, ALEA was not required to provide a defense to the action and the third-party complaint was properly dismissed. The claims of El Bamboo, to the contrary, lack sufficient merit for further discussion in a written opinion. R. 2:11- 3(e)(1)(E).