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Patyrak v. State Farm Fire and Casualty Co.


April 27, 2009


On appeal from Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-1036-06 and L-1044-06.

Per curiam.


Argued March 24, 2009

Before Judges Fuentes, Gilroy and Chambers.

Plaintiff James Patyrak appeals from the order of the Law Division dismissing his cause of action against defendants State Farm Fire and Casualty and Allstate Insurance Company.*fn1 Plaintiff sought indemnification under two homeowners liability policies issued by defendants for counsel fees he incurred in defending himself against a criminal indictment charging him with third-degree aggravated assault against a police officer, N.J.S.A. 2C:12-1b(5)(a), and fourth-degree resisting arrest during the course of an investigatory stop, N.J.S.A. 2C:29- 2a(3).

The matter came before the trial court by way of defendants' motions for summary judgment. After hearing the arguments of counsel, the court granted the motions finding, as a matter of law, that plaintiff had failed to state a claim upon which relief could be granted. We affirm.

On May 9, 2001, Raritan Township police officers responded to a Dunkin Donuts in Flemington to investigate a report that a man seated in his vehicle in the parking lot "appeared to be intoxicated." Officers already present at the scene, observed a vehicle pull into the parking lot "at a high rate of speed, and park[] in a parking space driving up over the curb with [its] right front tire." One of the officers approached the vehicle and "detected a strong odor of an alcoholic beverage coming from the [driver's (subsequently identified as plaintiff)] breath." Plaintiff allegedly informed the officer that he did not wish to speak with him, rolled up his car windows, and locked the doors. Two more officers approached plaintiff's vehicle on the driver's side. The officers again asked plaintiff to step out of his vehicle; plaintiff again refused. Left without alternative, two officers forcefully removed plaintiff from the vehicle. According to the investigation report, once outside the vehicle, plaintiff began to struggle and "grabbed [Officer Timothy] Apgar's arm and dug his fingernails into his forearm, causing lacerations." As the officers placed plaintiff in the police car, he started kicking, eventually striking another officer in the right upper leg.

On August 21, 2001, a grand jury indicted plaintiff with aggravated assault of a police officer and resisting arrest. Plaintiff retained counsel to represent him, and the charges were eventually dismissed.

During the relevant time period, plaintiff maintained insurance policies with both defendants. As to defendant State Farm, plaintiff was insured under two policies: a Homeowners Policy and a Personal Liability Umbrella Policy. As to defendant Allstate, plaintiff was also insured under two policies: a Floridian condominium policy, and a personal liability umbrella policy. Plaintiff filed a claim under these polices seeking indemnification for the cost incurred in connection with the defense of the criminal matter, and requested that defendants provide a defense of the criminal charges under both policies.

By letter dated July 6, 2001, State Farm declined liability, informing plaintiff that the conduct alleged in the criminal complaint was not covered under his policies. Specifically, the carrier relied on Section II, Coverage L of State Farm's Homeowners Policy, entitled "Liability Coverages", which provides that:

If a claim is made or a suit is brought against an insured for damages because of bodily injury or property damage to which this coverage applies, caused by an occurrence, we will:

1. pay up to our limit of liability for the damages for which the insured is legally liable; and

2. provide a defense at our expense by counsel of our choice....

The policy defines "occurrence" as "an accident... which results in bodily injury[] or property damage...." Under Section II Exclusions, the policy denies coverage for bodily injury: "(1) which is either expected or intended by the insured; or (2) which is the result of willful and malicious acts of the insured...." The umbrella policy contains similar language limiting coverage to damages incurred in connection with an accident, and excluding acts by the insured that are willful or malicious.

On September 28, 2001, plaintiff's attorney requested that Allstate indemnify plaintiff for expenses incurred in the underlying criminal proceeding and provide him with a defense. By letter dated October 2, 2001, Allstate reiterated its previous position that it would not provide a defense in criminal proceedings. A subsequent request for coverage was similarly answered. By letter dated June 3, 2005, Allstate described its position as follows:

The liability coverage under which you make your request... affords its benefits when you are pursued for bodily injury and/or property damage arising from an occurrence. You have confirmed that there has never been any claim presented against you for bodily injury or property damage.... The criminal charges made against you do not comport with the policy definition of the term "occurrence" which is defined in the policy as "[] an accident during the policy period, including continued and repeated exposure to substantially the same general harmful conditions during the policy period, resulting in bodily injury, personal injury or property damage."

Against these facts, plaintiff filed this lawsuit seeking coverage. Acting on defendants' motions for summary judgment, Judge Ashrafi dismissed plaintiff's complaint. The judge gave the following explanation for his ruling.

Here, the property damage that [p]laintiff is claiming is his defense costs in defending the criminal actions.... The [defendants'] policies are not exactly alike, but they're similar enough and they obviously do not cover defense of criminal charges as this in this case.


No [civil] claim or lawsuit has ever been filed and so the [p]laintiff here has never had to defend himself, or face the possibility of being found liable for damages to a third party arising out of bodily injury or property damage.

The [p]laintiff wants me to apply the wording of the insurance policies to interpret a criminal complaint or an indictment as a claim or a suit brought against him for damages. Well, a criminal complaint or an indictment is not the same thing as a claim or a suit in the courts. It is a charge by the government against an individual seeking the imposition of criminal penalties, and not the award of any kind of damages because of the conduct of the [insured].

So, it doesn't matter whether ultimately [plaintiff's] conduct was intentional or reckless or he is not guilty of all of the charges. These insurance policies don't provide coverage because no claim or suit has ever been brought against [plaintiff] seeking the recovery of damages for the alleged occurrence of May 9th, 2001.

Because no suit has ever been brought because there has been no claim for damages against these insurance carriers, they had no duty to defend [plaintiff] in the [c]court proceedings that were brought against him by the State of New Jersey or municipal authorities where he was arrested.

Because there is no coverage for the type of defense costs that the [p]laintiff is seeking here, there's obviously no bad faith on the part of the [d]efendants insurers in declining to provide coverage....

We agree with Judge Ashrafi and affirm. In determining whether a policy of insurance provides coverage for a given claim, we start by interpreting the policy as written, giving each word their plain meaning, thus avoiding creating a better policy than the one purchased by the insured. President v. Jenkins, 180 N.J. 550, 562 (2004). Here, a plain reading of the controlling language in these policies clearly excludes coverage for claims arising out of counsel fees incurred by the insured in connection with defending himself against criminal prosecution brought by the State.


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