On appeal from Superior Court of New Jersey, Law Division, Passaic County, Docket No. L-4288-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Baxter and Nugent.
Defendant Larimar Trucking*fn1 and its insurer, defendant Wilshire Insurance Company, appeal from a Law Division judgment that awarded attorneys' fees and costs to defendant Mediterranean Shipping Company based on Mediterranean's indemnification claim. Mediterranean had incurred fees and costs to defend itself against a lawsuit filed by plaintiff Eliel Santana, a tractor-trailer driver. Plaintiff had been injured in a vehicular accident following his dispatch by Larimar to haul freight on a trailer leased by Mediterranean. Mediterranean cross-appeals, contending that the fee award is inadequate.
We conclude that the terms of a Uniform Intermodal Interchange and Facilities Access Agreement (UIIA),*fn2 to which Larimar and Mediterranean were signatories, required Larimar to defend and indemnify Mediterranean against plaintiff's claim. We further conclude that an endorsement to the insurance policy issued by Wilshire to Larimar provided coverage for Larimar's contractual indemnification obligation. Lastly, we conclude that the UIIA choice-of-law clause required application of Maryland law to the parties' dispute, and that under Maryland law, Mediterranean was entitled to recover fees and costs that it incurred to investigate and defend against plaintiff's claim before tendering its defense to Wilshire. Accordingly, we affirm in part, reverse in part, and remand for further proceedings.
In support of their summary judgment motions, Larimar, Wilshire, and Mediterranean presented the following facts, which were either undisputed, or presented no genuine issue, R. 4:46-2(c).
Plaintiff, the owner of a 2002 Freightliner tractor, contracted to
perform "hauling services" for Larimar, a trucking company.*fn3
The contract between plaintiff and Larimar was in effect when
Larimar dispatched plaintiff to transport the freight container that
plaintiff was hauling on the day of his accident. On March 10, 2008,
while hauling the container on the trailer leased by
Mediterrean,*fn4 plaintiff lost control of the
tractor-trailer when a driver "cut [him] off," causing the
tractor-trailer to overturn. The other driver and car were never
At the time of plaintiff's accident, Larimar and Mediterranean were signatories to a UIIA. For purposes of the UIIA, Larimar was a "motor carrier" and Mediterranean was a "provider" who "interchanged"*fn5 equipment used in intermodal*fn6 transportation. The UIIA contained an indemnity clause in section F.4(a) that required motor carriers, such as Larimar, to indemnify providers, such as Mediterranean, for certain claims. The indemnity clause states in part:
Motor Carrier agrees to defend, hold harmless and fully indemnify the Indemnitees*fn7 (without regard to whether the Indemnitees' liability is vicarious, implied in law, or as a result of the fault or negligence of the Indemnitees), against any and all claims, suits, loss, damage or liability, for bodily injury . . ., including reasonable attorney fees and costs incurred in the defense against a claim or suit, or incurred because of the wrongful failure to defend against a claim or suit, or in enforcing subsection F.4 (collectively, the "Damages"), caused by or resulting from the Motor Carrier's: use or maintenance of the Equipment during an Interchange Period
The UIAA also required a Motor Carrier to provide a commercial automobile insurance policy insuring all "Equipment involved in an Interchange," and to "name the Equipment Provider as additional insured"; and to "attach to its commercial automobile liability policy, a Truckers Uniform Intermodal Interchange Endorsement (UIIE-1), which includes coverage specified in Section F.4." Larimar complied with these requirements. Mediterranean was named as an additional insured and the Wilshire policy included a Truckers Uniform Intermodal Interchange Endorsement (UIIE-1). The endorsement, which identified Larimar as the named insured, stated "that such insurance as is afforded by the policy for Auto Bodily Injury and Property Damage Liability applies to liability assumed by the named insured, as 'Motor Carrier Participant,' under Subsection F.4. of the [UIIA] and any subsequent amendments thereto."*fn8
On October 5, 2009, plaintiff filed an eight-count complaint against Larimar, Wilshire, Mediterranean, and others,*fn9 alleging that an unidentified driver had caused his accident and injuries. He also alleged that Larimar had failed to provide "underinsured [sic] motorist and workers' compensation coverage," that Mediterranean had failed to provide uninsured motorist (UM) coverage, and that Wilshire had improperly denied his claim for UM benefits. Mediterranean filed its answer and a cross-claim against Larimar and Wilshire for failing to defend and indemnify Mediterranean under the UIIA and the Wilshire policy.
Although Wilshire eventually settled plaintiff's claim, Mediterranean pursued its cross-claim and filed a summary judgment motion against Larimar and Wilshire. Larimar and Wilshire filed a cross-motion for summary judgment. Following oral argument, the trial court delivered its opinion from the bench, granted Mediterranean's motion, and denied Larimar and Wilshire's cross-motion. After providing the parties additional time to address the amount of counsel fees and costs sought by Mediterranean, the court entered judgment in favor of Mediterranean in the amount of $15,840.67, the reasonable fees and costs incurred by Mediterranean after it tendered its defense of plaintiff's claim to Larimar and Wilshire. The court denied Mediterranean's ...