On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, L-1693-06 and L-9841-07.
The opinion of the court was delivered by: Per Curaim
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 20, 2010
Before Judges Lisa and Reisner.
In this insurance coverage dispute, plaintiff Luis Santana appeals from a May 28, 2009 order granting summary judgment in favor of defendant New Hampshire Insurance Company (NH).*fn1 He also appeals from a September 25, 2009 order denying plaintiff's motion for reconsideration. Because the evidence, viewed favorably to plaintiff, could support a claim of estoppel due to NH's delay in denying coverage, we reverse the orders on appeal and remand this matter to the trial court.
Our review of the trial court's decision granting summary judgment is de novo. Agurto v. Guhr, 381 N.J. Super. 519, 525 (App. Div. 2005). Employing the Brill*fn2 standard, the same test that trial courts use in deciding summary judgment motions, we "determine whether the evidence, when viewed in a light most favorable to the non-moving party, would permit a rational fact-finder to resolve the dispute in the non-moving party's favor." Ibid. We have reviewed the record with that standard in mind.
The motion evidence, viewed in the light most favorable to plaintiff, would support the following factual findings. On August 10, 2005, plaintiff was severely injured when a vehicle driven by Juan Jose Flores collided with the taxicab plaintiff was driving. The Flores vehicle was covered by a policy with a $100,000 liability limit. The taxicab was insured by NH under a policy listing Caribe Cab Taxi Corporation (Caribe) as the only named insured. That policy included $300,000 in underinsured motorist (UIM) coverage. Plaintiff, the president and sole owner of Caribe, was a listed driver on the policy.
Because plaintiff was driving a commercial vehicle, he was not entitled to personal injury protection (PIP) coverage under either the NH policy or the Flores policy. Plaintiff had a separate insurance policy through Allstate New Jersey Insurance Company covering his personal automobile. That policy provided $50,000 in coverage, but as plaintiff's counsel advised NH's attorney on August 6, 2008, Allstate denied PIP coverage because plaintiff was driving a commercial vehicle at the time of the accident.
Plaintiff filed a personal injury lawsuit against Flores in 2006. Additionally, because he anticipated that his medical expenses alone would exceed Flores' $100,000 coverage, plaintiff sought recovery under the UIM provision of the NH policy. On November 15, 2007, plaintiff filed a verified complaint and order to show cause against NH alleging that NH had "stopped cooperating and communicating with plaintiff['s] representatives." The verified complaint sought a declaration of insurance coverage and an order requiring NH to participate in UIM arbitration.
In January 2008, NH filed an answer to the verified complaint. The answer raised sixteen boilerplate affirmative defenses which appeared primarily aimed at defending against a negligence-based personal injury claim. The answer did not assert or mention the existence of a step-down clause in the policy. In fact, nowhere in the answer did NH specifically deny that the policy provided coverage for the accident.
Both before and after filing the verified complaint, plaintiff's counsel repeatedly advised NH that plaintiff would probably need surgery to address his serious injuries. According to the attorney's certification, NH's representatives confirmed to him that there was $300,000 in UIM coverage and never suggested that there might not be coverage for plaintiff's medical expenses. In a September 6, 2007 letter to NH's claims representative, plaintiff's counsel wrote: "This confirms my conversation with New Hampshire Insurance Co. representatives today" that "[t]he coverage for the Caribe Cab Taxi vehicle is confirmed." The letter also confirmed that the attorney had told the NH representative that plaintiff would need "neck surgery" to address a herniated disc and that his overall claim would "probably be in the $300,000 to $500,000 range."*fn3
The record contains several additional letters from plaintiff's counsel to NH or its attorney advising that plaintiff was going to undergo the surgery. At no time prior to the surgery did NH's representatives advise that there was a step-down clause, deny that there was UIM coverage for the surgery, or suggest that plaintiff hold off on having the surgery because there might not be sufficient coverage. According to plaintiff's counsel, his client only had a copy of the declarations page of the Caribe policy and NH ignored the attorney's requests for a copy of the entire policy.
Plaintiff underwent the surgery in March 2009. In a certification, plaintiff attested that when, as president and sole owner of Caribe, he purchased the NH policy, he understood that the policy would provide him with $300,000 in UIM coverage. He knew that the UIM coverage was particularly important because there was no PIP coverage for a commercial vehicle. He also attested that he ...