On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-1770-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Skillman and LeWinn.
Plaintiff Empire Fire & Marine Insurance Co. (Empire) issued a "Supplemental Rental Liability Insurance Excess Policy" to Enterprise Rent-A-Car Company (Enterprise), a car rental company. The policy provided excess coverage for liability above the "minimum financial responsibility limits of the applicable jurisdiction" to any person renting a car from Enterprise who purchases "supplemental rental liability insurance."*fn1 The policy contained certain exclusions, including for:
1. Loss arising out of an "accident" which occurs while the "insured" is under the influence of alcohol or drugs, or other substances unless prescribed by a physician.
2. Loss arising out of the use of a "rental vehicle" when such use is in violation of the terms and conditions of the "rental agreement."
On March 16, 2004, defendant John Bennett, Jr. rented a car from Enterprise. The rental agreement offered supplemental rental liability insurance as an option for an additional charge, which Bennett accepted. The agreement stated that this coverage would not apply "if the rental agreement is violated," and that "[a] violation of the rental agreement shall exist . . . [i]f the car is used or driven . . . [b]y any person if there is reasonable evidence they were under the influence of narcotics, intoxicants or drugs." In addition, the jacket to the rental agreement stated:
Exclusions. All exclusions are stated in the policy, however, the following are a few key exclusions.
(a) loss arising out of an accident which occurs while the Renter or Authorized Driver is under the influence of alcohol or drugs or other substances unless prescribed by a physician[.]
On March 18, 2004, Bennett drove defendant Richard Amato to a bar for a celebration of Amato's birthday. Both Bennett and Amato consumed alcoholic beverages in the bar. On the way home, Bennett was involved in an accident in which Amato suffered serious personal injuries. Bennett subsequently pled guilty to a charge of driving while under the influence of alcohol, in violation of N.J.S.A. 39:4-50, at the time of the accident.
Amato brought a personal injury action against Bennett and other parties for the injuries he suffered in the accident.*fn2
Bennett submitted a notice of claim to Empire, which disclaimed coverage on the ground that the accident falls within the policy exclusion for any loss caused by the insured while driving under the influence of alcohol.
Empire subsequently brought this action for a declaratory judgment that the excess policy it issued to Enterprise did not provide Bennett coverage for Amato's claim. Empire named both Bennett and Amato as defendants. Amato's answer sought a declaration that the Empire policy provides coverage to Bennett for Amato's claim arising out of the March 18, 2004 accident. Amato did not file a ...