April 2, 2012
VSH REALTY, INC., AND CUMBERLAND FARMS, INC., PLAINTIFFS-RESPONDENTS,
ROBERT BROWN T/A SUB BUSTERS, II, DEFENDANT, AND CUMBERLAND MUTUAL FIRE INSURANCE COMPANY, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-2733-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued March 20, 2012
Before Judges Fisher and Nugent.
Julianna VanSciver's slip and fall on the sidewalk of a strip mall in Little Egg Harbor on January 7, 2003, gave rise to this declaratory judgment action between plaintiff VSH Realty, Inc., the property's landlord, and defendant Cumberland Mutual Fire Insurance Company, the insurer of defendant Robert Brown (hereafter Sub Busters, the name in which Brown did business), one of the strip mall's two tenants. As determined by a jury in the underlying personal injury action, VanSciver's slip and fall occurred on the sidewalk in front of the premises of the other tenant, plaintiff Cumberland Farms, Inc. (CFI), not on the sidewalk in front of Sub Busters. Because Cumberland Mutual did not agree to defend and indemnify VSH or CFI for personal injuries occurring anywhere other than within Sub Busters' leased premises and not the sidewalk directly in front of another tenant's leased premises, we reverse the judgment entered in favor of VSH and CFI and against Cumberland Mutual.
The underlying facts are relatively simple. VanSciver went to the strip mall on the day in question with the intent to patronize both CFI and Sub Busters. She parked in the lot in a spot between the entrances to both CFI and Sub Busters and walked toward the entrance to CFI when she slipped on the sidewalk in front of CFI. In her personal injury action against both tenants, the jury determined that CFI was negligent, not Sub Busters.
In seeking indemnification from Sub Busters' insurer, Cumberland Mutual, VSH and CFI relied on various portions of the lease entered into by VSH and Sub Busters. One provision required that Sub Busters indemnify and hold VSH harmless for any "injuries to persons occurring in or about the premises, or injuries to persons arising out of the use of the premises regardless of whether said injuries actually occur on the premises." A similar provision required Sub Busters to indemnify and hold VSH harmless for injuries "resulting from or arising out of . . . the condition or use of premises, all buildings, improvements and equipment thereon during the term of this lease." Sub Busters, however, did not agree to indemnify and hold VSH harmless from losses or injuries arising out of VSH's own negligence or the negligence of any other tenant, such as CFI.*fn1
Sub Busters was insured by Cumberland Mutual, which was not a party to the lease; for that reason, Cumberland Mutual's liability extends only so far as its insuring provisions permit. In other words, Cumberland Mutual's liability is governed by its insurance policy, not the lease provisions, although an understanding of the insuring clause may be illuminated by the lease.*fn2
Cumberland Mutual's policy unambiguously extends coverage to VSH*fn3 "only with respect to liability arising out of the maintenance, ownership or use of that part of the designated premises leased to" Sub Busters. Experience reveals that what it means to "use" leased premises is not always clear. Case law that has developed with regard to claims occurring in common areas in a strip mall has recognized that a tenant may be responsible notwithstanding that the claimant was not physically on or within the tenant's leased premises when the accident occurred. See Liberty Village Assocs. v. West Am. Ins. Co., 308 N.J. Super. 393, 398-402 (App. Div.), certif. denied, 154 N.J. 609 (1998); Harrah's Atlantic City, Inc. v. Harleysville Ins. Co., 288 N.J. Super. 152, 157-59 (App. Div. 1996); Franklin Mut. Ins. Co. v. Security Indem. Ins. Co., 275 N.J. Super. 335, 340-41 (App. Div.), certif. denied, 139 N.J. 185 (1994). We have held that a tenant may be responsible for a personal injury that occurred in common areas of a shopping mall before the patron had reached the tenant's leased premises, Liberty Village Assocs., supra, 308 N.J. Super. at 396, as well as after the patron had left the tenant's business, Franklin Mut. Ins. Co., supra, 275 N.J. Super. at 340-41.
In many of the situations we have previously encountered, the extent to which the claimant was using the tenant's premises was uncertain or questionable, thus giving rise to the application of a "substantial nexus" test. See, e.g., Harrah's Atlantic City, Inc., supra, 288 N.J. Super. at 159. Here, however, a jury determined that VanSciver's slip and fall occurred in front of CFI's leased premises and absolved Sub Busters of any liability. Unlike the cases cited above, VanSciver was neither on her way to Sub Busters nor had just left Sub Busters. She was injured on her way into CFI and only intended, but was unable to act on the intention, to also patronize Sub Busters. That circumstance is inherent in the jury's verdict and governs the extent of Cumberland Mutual's liability to VSH because it not only excludes any claim that VanSciver was "using" Sub Busters' premises when the slip and fall occurred but also because it conclusively determined that the slip and fall resulted from CFI's sole negligence, both circumstances for which Cumberland Mutual did not provide coverage. See Pennsville Shopping Ctr. Corp. v. Am. Motorists Ins. Co., 315 N.J. Super. 519, 523 (App. Div. 1998), certif. denied, 157 N.J. 647 (1999).
Notwithstanding the prior adjudication that VanSciver fell on snow or ice on the sidewalk in front of CFI's premises, VSH and CFI argue that because VanSciver intended to patronize Sub Busters that it could be said that, when injured while patronizing CFI's business, VanSciver was also "using" Sub Buster's premises. Nothing in our case law -- and we reject an extension of that body of law to cover such an event -- would suggest that leased premises were "used" merely because the injured patron intended, without acting on the intention, to patronize the premises. VanSciver parked in a common area, walked toward CFI and while on the sidewalk in front of CFI, fell on snow or ice that CFI had failed to remove. These undisputed facts absolved Sub Busters of any liability; Sub Busters contractually agreed only to keep snow and ice off the sidewalk in front of its own leased premises and had no obligation to keep snow and ice off CFI's sidewalk. Those same undisputed facts preclude the imposition of a duty on Cumberland Mutual because Cumberland Mutual only agreed to defend and indemnify VSH for claims "arising out of the maintenance, ownership or use of that part of the designated premises leased to" Sub Busters. Because Sub Busters was not required to maintain the sidewalk where VanSciver slipped and fell and because the circumstances do not permit a conclusion that VanSciver's fall arose from Sub Busters' use of its leased premises, the trial judge erred in entering a declaratory judgment in favor of VSH and CFI.
We reverse the declaratory judgment under review, as well as the order denying reconsideration of that judgment, and remand for the entry of judgment, in favor of Cumberland Mutual, dismissing the complaint. We do not retain jurisdiction.