On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. L-1602-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued October 22, 2012 -
Before Judges Sabatino, Fasciale and Maven.
Farmers Mutual Fire Insurance Company of Salem County (Farmers Mutual) appeals from three orders dated July 22, 2011
(1) permitting defendant Patricia Weston Rivera (Rivera or tenant) to amend her answer and assert cross-claims against Farmers Mutual; (2) granting Rivera's motion for summary judgment on her cross-claims against Farmers Mutual; and (3) compelling Farmers Mutual to pay Rivera's attorney's fees, half of the attorney's fees incurred by Travelers Casualty Insurance Company of America (Travelers),*fn1 and half of a settlement reached by Nadia Davis (Davis).*fn2 Rivera cross-appeals from that part of one of the orders requiring her to indemnify 1982 Springfield.*fn3
We affirm in part and reverse in part on the appeal, and reverse on the cross-appeal.
In reviewing a grant of summary judgment, we apply the same standard under Rule 4:46-2(c) that governs the trial court. See Liberty Surplus Ins. Corp. v. Nowell Amoroso, P.A., 189 N.J. 436, 445-46 (2007). We must "consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). Viewed most favorably to plaintiff, the summary judgment record established the following facts.
Rivera, an attorney, entered into a lease (the lease) to rent office space in a commercial building that 1982 Springfield owned.*fn4 Rivera purchased a comprehensive general liability policy (the policy) from Farmers Mutual and obtained $300,000 in coverage. In February 2008, Davis visited Rivera's law office, slipped on an ice-covered platform in the parking lot, and sustained injuries. 1982 Springfield maintained exclusive control over the location of the fall.*fn5
Among other things, the lease required Rivera to indemnify 1982 Springfield against general losses and to obtain insurance "in the joint name of [Rivera] and [1982 Springfield]." Rivera, however, failed to obtain insurance for 1982 Springfield. The policy Rivera procured from Farmers Mutual excluded damages resulting from contractual indemnification.
In February 2009, Davis filed her personal injury complaint against 1982 Springfield (the personal injury case), seeking compensation for injuries she sustained in the fall. 1982 Springfield tendered the defense of the personal injury case to Farmers Mutual, contending that Rivera was obligated to indemnify it and name it as an insured on the policy. Farmers Mutual declined to defend 1982 Springfield because it was not an insured on the policy and also because it maintained that Rivera was not obligated to indemnify 1982 Springfield for losses resulting from 1982 Springfield's own negligence.
1982 Springfield then filed a third-party complaint in November 2009 against Rivera and Farmers Mutual.*fn6 Farmers Mutual defended Rivera on Counts Two and Three of the third-party complaint, but reserved its rights on Count One, citing the contractual indemnification exclusion in the policy. Farmers Mutual retained separate counsel to defend 1982 Springfield's allegations in Count Four. Rivera then retained separate counsel to defend her on Count One regarding her alleged contractual breach in failing to obtain insurance for 1982 Springfield.*fn7
In February 2011, Davis obtained a non-binding arbitration award of $150,000. R. 4:21A-1(a)(2). The arbitrator allocated 80% liability to 1982 Springfield, 0% to Rivera, and 20% to Davis. Rivera received 0% liability because the arbitrator found that 1982 Springfield was solely responsible for snow removal. Thus, the net award to Davis was $120,000. Thereafter, 1982 Springfield settled with Davis for $120,000.*fn8
1982 Springfield filed a motion for summary judgment on the remaining claims concerning coverage and indemnification and Rivera cross-moved for summary judgment. Rivera then filed a motion to amend her answer to assert cross-claims against Farmers Mutual seeking indemnification and bad faith damages, and the judge permitted her to seek summary judgment on her cross-claims. The judge conducted oral argument and on July 22, 2011, entered the three orders now under review and issued a lengthy written opinion.
The judge determined that 1982 Springfield was responsible for Davis's injuries, that Rivera was not obligated to indemnify 1982 Springfield for loss resulting from 1982 Springfield's own negligence, and that Rivera breached the lease by failing to obtain insurance for 1982 Springfield. He stated that "[t]he most that can be said is that [Rivera] committed a technical violation of [the] lease agreement by not including 1982 Springfield as an additional named ...