On appeal from the Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-1605-05.
The opinion of the court was delivered by: Stern, P.J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Stern, A.A. Rodríguez and Collester.*fn1
Defendants, Norbet Trucking Corporation and the Insurance Company of the State of Pennsylvania (ICSOP), appeal from a final judgment based on an order of October 4, 2006, and orders of June 20, 2006, entered in favor of plaintiffs, Great American Assurance Company, Moper Transportation Inc. and Manuel Flores, declaring that ICSOP must provide coverage in the case of Colon v. Moper, and requiring reimbursement to Great American by ICSOP for counsel fees and costs in that matter and this declaratory judgment action. The court had ruled by order of June 20, 2006, that Flores, Moper's sole shareholder and president, was using "the subject-matter tractor to return home after leaving Norbet Trucking's facility after completing his dispatch duties . . . in the course and scope of the commercial business of Norbet Trucking as that term is defined in the respective policies and applicable case law," that "the non-trucking [or business use] exclusion contained in the Great American non-trucking liability policy is applicable"*fn2 so that Great American did not provide coverage for Flores' accident with David Colon in January 2004, and that ICSOP "must provide primary coverage" for injuries and damages resulting from the accident.
Moper had entered into a Transportation Service Agreement (TSA) with Norbet, and ICSOP issued a commercial trucker's liability policy to Norbet while Great American issued a "non-trucking liability" policy to Moper. Due to the weather, Flores missed his normal ride home from work, and was driving the tractor from its New Jersey garage to his New York home when the accident occurred on the West Shore Expressway on Staten Island, New York.
Defendants argue New York law should apply, Great American's "business use exclusion" is invalid thereunder, and, in any event, the tractor was not being used for business purposes. Thus, defendants assert that Great American provides coverage. They further contend that Great American, as an insurer, cannot collect counsel fees under Rule 4:42-9(a)(6) even if we affirm the judgment as to coverage, but that if a carrier can so collect, ICSOP is entitled to its fees and costs if we reverse the coverage determination. We affirm the judgment.
As already stated, this declaratory judgment stems from a motor vehicle accident that occurred on January 27, 2004, on the West Shore Expressway in Staten Island when vehicles driven by Flores and David Colon were involved in an accident. The vehicle driven by Flores was a 1998 Kenilworth tractor ("the tractor") registered in New Jersey. Colon was a resident of New York. He was driving a car registered in New York and owned by Kate Agugliaro, a resident of New York. Flores was also a resident of New York.
The tractor driven by Flores was owned by Moper, a New Jersey corporation which has its principal place of business in Jersey City.*fn3 Flores is the sole shareholder of Moper. Moper owned only one tractor and Flores was the sole driver.
Prior to the date of the accident Moper leased the tractor to Norbet pursuant to the TSA dated December 1, 2003. Pursuant to their agreement, Moper performed "transportation services" for Norbet as a "contractor" while using its tractor. Norbet is a New Jersey trucking company that transports goods in interstate commerce.
In accordance with federal regulations, Norbet, "as a freight forwarder and/or common carrier" was required to obtain "public liability, property damage, and cargo insurance." The TSA requires Moper to provide "non-trucking liability, and/or bobtail and deadhead insurance coverage"*fn4 in an amount no less than $1,000,000, and furnish a certificate of such insurance to Norbet. The TSA states that "[t]he parties to this Agreement agree that the Agreement, and any and all disputes or interpretations arising under it, shall be governed by the laws of the state of New Jersey except to the extent pre-empted by applicable federal law."*fn5
Pursuant to the TSA, Norbet obtained Trucking Liability Insurance from ICSOP running from December 15, 2003 to December 15, 2004. Moper purchased a "Non-Trucking Liability" policy from Great American for the period from November 19, 2003 to November 19, 2004. The Great ...