On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-9821-01.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Coburn, Grall and Chambers.
This appeal concerns an insurance coverage dispute between defendant United States Fire Insurance Company ("U.S. Fire") and defendant Hartford Casualty & Insurance Company ("Hartford"). The dispute involves coverage to defendant R.C. Dolner Construction ("Dolner") for a personal injury claim arising out of a construction accident. On cross-motions for summary judgment, the trial court found that U.S. Fire was obligated to provide coverage to Dolner for the claim. U.S. Fire appeals. We reverse.
The personal injury claim arose out of an accident that took place on June 16, 2000, at the Century Tower Project ("the Project") owned by Just Apartments, L.L.C. ("Just Apartments"). Dolner was hired by Just Apartments to provide construction management services for the Project. Plaintiff Albert Welcome was injured while installing laundry machines in the common laundry room for the Project. He brought this lawsuit against Just Apartments and Dolner as well as other defendants. The issue in this appeal is whether Dolner's general liability carrier, U.S. Fire, provides coverage to Dolner on this claim.
The contract between Just Apartments and Dolner required Just Apartments to maintain liability coverage during the construction of the Project and to designate Dolner as a "named insured" on the policy. In accordance with this contractual obligation, Just Apartments obtained a liability policy from Hartford, and Dolner and Just Apartments were listed as named insureds on the policy.
Dolner also had a general liability policy with U.S. Fire. Hartford contends that Dolner's general liability policy with U.S. Fire is primary on the claim. Hartford filed an amended fourth-party complaint against U.S. Fire seeking a declaration that U.S. Fire's policy is primary, that U.S. Fire must defend and indemnify Dolner for Welcome's claim, and that U.S. Fire must reimburse Hartford for its costs in defending Dolner. In opposition, U.S. Fire maintained that coverage for the Project was excluded from its policy and that, accordingly, its policy does not cover plaintiff's claim.
On cross-motions for summary judgment, the trial court determined that the U.S. Fire policy covered plaintiff's claim.
U.S. Fire's motion for summary judgment was denied, and Hartford's cross-motion for summary judgment was granted. The trial court ordered U.S. Fire to pay fifty percent of Dolner's defense costs. U.S. Fire's motion for reconsideration was also denied. U.S. Fire appeals from the order of May 15, 2006, denying its motion for summary judgment and also from the order of September 22, 2006, denying its motion for reconsideration.
U.S. Fire contends on appeal that coverage under its policy is barred by certain exclusions in the policy, including the wrap-up exclusion, and that the trial court should have considered extrinsic evidence when determining whether the U.S. Fire policy was intended to cover a claim arising from Dolner's work on the Project.*fn1
The U.S. Fire policy excludes from coverage "all wrap-up insurance programs."*fn2 Relying on this exclusion, U.S. Fire contends that its policy does not cover Dolner for its activities at the Project, since the Hartford policy provides "wrap-up coverage" to Dolner. Hartford maintains that its policy does not provide "wrap-up coverage" as that term is understood in the insurance industry and hence this exclusion in the U.S. Fire policy does not apply to Dolner's activities at the project.
The parties present somewhat conflicting definitions of a wrap-up policy. They do agree that it is insurance provided for a construction project that covers the owner and the general contractor. However, Hartford contends that the definition is more precise and argues that its policy is not a wrap-up because it does not provide workers' compensation coverage, it does not cover any of the subcontractors, and it does not provide builder's risk coverage for the premises. The broker who procured the Hartford policy for Just Apartments testified that his understanding was that a wrap-up policy is "insurance coverage procured specifically for a project covering all the owners, GC's and all subcontractors for insurance." He did not believe that the Hartford policy was a wrap-up because it did not provide coverage to the subcontractors. U.S. Fire maintains that all of these features are not necessary in a wrap-up policy.
When determining the meaning of an insurance policy, we must seek to ascertain the probable intent of the parties "in an effort to find a reasonable meaning in keeping with the express general purposes of the policy." Sinopoli v. N. River Ins. Co., 244 N.J. Super. 245, 250 (App. Div. 1990), certif. denied, 127 N.J. 325 (1991). Generally, "[w]hen interpreting an insurance policy, courts should give the policy's words 'their plain, ordinary ...