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(NOTE: The status of this decision is unpublished.)
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-5197-06T35197-06T3
CERTAIN UNDERWRITERS AT LLOYD'S,
LONDON SUBSCRIBING TO POLICY
LH00016,
Plaintiff-Respondent,
v.
LOUIS PEREZ and ARANGO FLOORING,
Defendants,
and
RONALD DELINO,
Defendant-Appellant.
Argued April 8, 2008 - Decided
Before Judges Skillman, Yannotti and LeWinn.
On appeal from Superior Court of New Jersey, Law Division, Hudson County, Docket No.
L-1198-07.
John J. Jasieniecki argued the cause for appellant (Green, Jasieniecki & Riordan,
attorneys; Mr. Jasieniecki, of counsel and on the brief).
Erin Nulty argued the cause for respondent (Nelson Levine de Luca & Horst, attorneys;
John M. Clark, Jeffrey G. Rapattoni and Ms. Nulty, on the brief).
PER CURIAM
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Defendant Ronald Delino is a general contractor who does business under the name Delman Contracting.
Defendant Delino owned an unoccupied house in Chatham that he was rehabilitating. Delino entered into a
subcontract for flooring work with defendant Arango Wood Floors. Defendant Louis Perez was an employee of
Arango. On August 2, 2005, Perez was injured during the course of his employment. Arango did not have insurance
coverage for workers' compensation benefits at the time of this accident.
Perez filed claims for benefits in the Division of Workers'
Compensation against both Arango and Delman Contracting. Perez's claim against Delman Contracting was based
on N.J.S.A. 34:15-79, which provides in pertinent part:
Any contractor placing work with a subcontractor shall, in the event of the
subcontractor's failing to carry workers' compensation insurance as required by this
article, become liable for any compensation which may be due an employee or the
dependents of a deceased employee of a subcontractor.
Before Perez's accident, Delino had obtained a homeowner's insurance policy issued by plaintiff Lloyd's for the
house he was rehabilitating. The pertinent provisions of that policy are quoted later in this opinion.
Delino and Delman Contracting filed a motion in the Division of Workers' Compensation to implead Lloyd's and
adjudicate its responsibility under the homeowner's policy issued to Delino to defend Perez's workers'
compensation claim and indemnify Delino and Delman Contracting for any benefits they might be liable to pay
Perez. Lloyd's responded to this motion, but before the response was heard, Lloyd's filed this action in the Law
Division for a declaratory judgment that the policy it issued to Delino does not provide coverage for Perez's workers'
compensation claim. The trial court entered an order to show cause which stayed proceedings in the Division of
Workers' Compensation pending final resolution of the coverage issue.
On the return date, the trial court concluded in an oral opinion that the policy Lloyd's issued to Delino does not
provide coverage for Perez's workers' compensation claim. Accordingly, the court entered a final judgment
declaring that Lloyd's "has no duty to defend or indemnify Ronald Delino and/or Delman Contracting against any
claims made by Louis Perez in Workers' Compensation Court arising out his injuries sustained at 11 Joanna Way,
Chatham, New Jersey on or about August 2, 2005."
On appeal, Delino argues that the trial court erred in staying proceedings in the Division of Workers' Compensation
and deciding the coverage issue rather than allowing the Division to decide this issue. Even assuming Delino could
have impleaded Lloyd's in the proceedings before the Division and obtained a determination as to whether Delino's
homeowners policy provided coverage for Perez's claim, see Williams v. Bituminous Cas. Corp., 51 N.J. 146, 150
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(1968), the trial court had concurrent jurisdiction to decide this issue, see Gerhardt v. Cont'l Ins. Cos., 48 N.J. 291,
294-95 (1966). Moreover, even if the trial court should have allowed the Division of Workers' Compensation to
decide the coverage issue in the first instance, we are satisfied the determination of this issue involves solely
interpretation of the policy, and therefore, that we should decide the merits.
The homeowner's policy that Lloyd's issued to Delino expressly excluded coverage for workers' compensation
benefits. Coverage E, entitled "Personal Liability," excluded coverage for
4. "Bodily Injury" to any person eligible to receive any benefits voluntarily
provided or required to be provided by an "insured" under any:
a. Workers' compensation law[.]
Similarly, Coverage F, entitled "Medical Payments to Others," excluded coverage for
any person eligible to receive benefits voluntarily provided or required to be provided
under any:
a. Workers' compensation law[.]
In addition to these exclusions, the Lloyd's policy also excludes coverage for any personal liability for
"Bodily injury" . . . arising out of or in connection with a "business" conducted from an
"insured location" or engaged in by an "insured", whether or not the "business" is
owned or operated by an "insured" or employs an "insured".
We are satisfied that, under the plain language of the Lloyd's policy, Delino's alleged liability under N.J.S.A. 34:15-79
for the payment of workers' compensation benefits because of Arango's failure to carry workers' compensation
insurance coverage constitutes a liability "for benefits . . . required to be provided under any . . . Workers'
Compensation Law" within the intent of workers' compensation benefits exclusions of the policy. See Gordon v.
New Hampshire Ins. Co., 89 N.J. Super. 246, 252 (App. Div. 1965). Furthermore, there is no basis for a claim that
Delino had a reasonable expectation of coverage because his alleged liability for compensation benefits is not
based on his employment of Perez but rather his use of a subcontractor who failed to carry workers' compensation
coverage, because the policy excludes coverage for any liability arising out of a business conducted on the insured
premises. Delino's alleged status as general contractor for the renovation of the insured premises clearly
constituted a business within the intent of this exclusion.
Finally, we note that Delino does not allege that he had any personal dealing with Lloyd's or that the insurance
broker through which he obtained the homeowner's policy was acting as Lloyd's agent. Therefore, even if the
broker conveyed the impression to Delino that the policy would extend more expansive coverage than the Lloyd's
policy provides, this would not be a basis for imposing responsibility upon Lloyd's to defend and indemnify Delino.
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Affirmed.
(continued)
(continued)
6
A-5197-06T3
April 23, 2008
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