APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-
HAMPTON MEDICAL GROUP, P.A.,
PSYCHIATRIC ASSOCIATES OF NEW
JERSEY, P.A., AND A.L. CARTER
POTTASH, M.D.,
Plaintiffs-Respondents,
v.
PRINCETON INSURANCE COMPANY,
Defendant-Appellant,
and
TRAVELERS INSURANCE COMPANY,
MEDICAL INTER-INSURANCE EXCHANGE
OF NEW JERSEY, RLI INSURANCE COMPANY,
LEGION INSURANCE COMPANY, PSYCHIATRISTS'
RISK RETENTION GROUP, INC., ATLANTIC
MUTUAL INSURANCE COMPANY, FIREMAN'S
FUND INSURANCE COMPANY and JOHN
DOES 1-10,
Defendants.
____________________________________________
HAMPTON MEDICAL GROUP, P.A.; DOCKET NO. A-4508-02T1
PSYCHIATRIC ASSOCIATES OF
NEW JERSEY, P.A. and A.L. CARTER
POTTASH, M.D.,
Plaintiffs-Respondents,
v.
MEDICAL INTER-INSURANCE EXCHANGE OF
NEW JERSEY,
Defendant-Appellant,
and
TRAVELERS INSURANCE COMPANY,
PRINCETON INSURANCE COMPANY,
RLI INSURANCE COMPANY, LEGION
INSURANCE COMPANY, PSYCHIATRISTS'
RISK RETENTION GROUP, INC.,
ATLANTIC MUTUAL INSURANCE COMPANY,
FIREMAN'S FUND INSURANCE COMPANY
and JOHN DOES 1-10,
Defendants.
_______________________________________
Submitted November 17, 2003 - Decided January 29, 2004
Before Judges Petrella, Wefing and Collester.
On appeal from Superior Court of New Jersey,
Law Division, Essex County, L-2062-01 (A-4508-02T1) and L-2061-01 (A-4504-02T1).
Mendes & Mount, attorneys for appellant
Princeton Insurance Company (William S.
Wachenfeld, of counsel; Laura E. Genovese,
on the brief).
Saiber Schlesinger Satz & Goldstein, attorneys
for appellant MIIX Insurance Company, successor
to Medical Inter-Insurance Exchange of New
Jersey (David J. D'Aloia, Michelle V. Fleishman,
and Melissa A. Provost, on the brief).
Ashley & Charles, attorneys for respondents
Hampton Medical Group and Psychiatric Associates
of New Jersey (Thomas R. Ashley, on the joint
brief).
Arsenault Fassett & Mariano, attorneys for
respondent A.L. Carter Pottash, M.D. (David
W. Fassett, on the joint brief).
The opinion of the court was delivered by
WEFING, J.A.D.
These two matters were calendared before us back-to-back. Because they present identical issues,
we consolidate them for purposes of this opinion. In A-4504-02, Princeton Insurance Co.
appeals pursuant to leave granted from a trial court order finding it has
a duty to defend its insureds, Hampton Medical Group, P.A., Psychiatric Associates of
New Jersey, P.A. and A.L. Carter Pottash, M.D. ("plaintiffs") in connection with a
pending action, Blue Cross and Blue Shield of New Jersey, Inc. v. Hampton
Medical Group, P.A., et al., docket no. ESX-L-289-95. In A-4508-02, we granted leave
to appeal to MIIX Insurance Company, successor to Medical Inter-Insurance Exchange of New
Jersey ("MIIX"), to appeal from the same order, which found it had a
similar duty. After reviewing the record in light of the contentions advanced on
appeal, we reverse.
Plaintiff Hampton Medical Group, P.A. had a contract to provide psychiatric physician services
to Hampton Hospital, a one-hundred bed psychiatric facility located in Rancocas, New Jersey.
Plaintiff Psychiatric Associates of New Jersey, P.A. had a contract to provide psychiatric
physician services at Fair Oaks Hospital, located in Summit, New Jersey. Plaintiff Pottash
is a licensed medical doctor and the president of both Hampton Medical and
Psychiatric Associates. He was also a shareholder in both professional associations.
Defendant Princeton issued a professional liability insurance policy to plaintiffs for the period
May 1985 through May 1991. Defendant MIIX issued a professional liability insurance policy
to plaintiffs for the period March 1991 through April 1995.
Both policies provided coverage for claims asserting professional liability against the professional associations
and individuals. Under Princeton's policy, in the case of a claim of individual
liability, it agreed to
Pay all amounts . . . which you become legally obligated to pay
as a result of injury to which this insurance applies. The injury must
be caused by a "medical incident" arising out of your supplying or failure
to supply professional services.
Princeton's policy contained similar language for claims asserted against the professional associations, specifying
that the "injury must be caused by a 'medical incident' arising out of
the supplying of or failure to supply professional services by you or anyone
for whose professional acts or whose failure to act you are legally responsible."
Princeton's policy defined "medical incident" in the following manner:
"medical incident" means any act or failure to act:
(a) Individual Professional Liability--(1) in the furnishing of the professional medical . .
. services by you, any employee of yours . . . .
(b) Partnership, Association or Corporation Professional Liability--in the furnishing of professional medical .
. . services by (1) any member, partner, officer, director, stockholder, or employee
of yours or (2) any person acting under your personal direction, control, or
supervision.
Under MIIX's policy, it agreed to "pay . . . all sums which
the insured shall become legally obligated to pay as damages because of .
. . [i]njury arising out of the rendering of or failure to render
. . . professional services." MIIX defined a medical incident as "a single
act or omission or a series of related acts or omissions in the
rendering of or failure to render professional services to any one person." It
also defined professional services as "services requiring specialized knowledge and mental skill in
the practice of the profession described in the declarations . . . ."
The declaration sheet stated the insured's principal practice to be psychiatry.
Each policy explicitly excluded coverage for criminal acts. Princeton's policy also excluded coverage
for liability as a proprietor, officer or stockholder of any business. MIIX's policy
contained a similar exclusion from coverage for liability as proprietor, superintendent or officer
of a business enterprise as well as an exclusion for "willful, fraudulent or
malicious acts."
In December 1994, Blue Cross/Blue Shield of New Jersey, Inc. filed a complaint
against these plaintiffs and others in which it sought reimbursement for more than
three million dollars in health insurance benefits which it alleged were improperly paid
to these plaintiffs. Blue Cross/Blue Shield's complaint asserted claims based on fraud, violations
of the Insurance Fraud Prevention Act, N.J.S.A. 17:33A-1 to -30, intentional misrepresentation, negligent
misrepresentation and unjust enrichment. Blue Cross/Blue Shield alleged that plaintiffs, over a number
of years, would hospitalize patients inappropriately to trigger health insurance coverage, would treat
patients for longer than was medically necessary or in ways not medically necessary
in order to obtain payment under Blue Cross/Blue Shield health insurance policies and
would bill Blue Cross/Blue Shield for services they did not render.
The policies issued by Princeton and MIIX were in effect during the time
period covered by the Blue Cross/Blue Shield complaint. Plaintiffs forwarded a copy of
this complaint to Princeton and MIIX, demanding they provide a defense and indemnification
against these claims. When neither insurer complied, plaintiffs filed this declaratory judgment action
in March 2001.
See footnote 1
There is no indication in the record before us that the declaratory judgment
action was consolidated with the Blue Cross/Blue Shield matter. The prosecution of both
matters was significantly delayed by the fact that certain of the defendants in
the Blue Cross/Blue Shield matter held policies of insurance issued by Legion Insurance
Company, whose entry into reorganization resulted in the imposition of various stays. We
have previously acknowledged the impact upon New Jersey litigation of Legion's impaired financial
condition.
Aly v. E.S. Sutton Realty,
360 N.J. Super. 214 (App. Div. 2003).
At several points in the declaratory judgment litigation, plaintiffs and Princeton and MIIX
sought partial summary judgment. Ultimately, the trial court ruled that, in light of
the fact that Blue Cross/Blue Shield included a count for negligent misrepresentation in
its complaint, both Princeton and MIIX had an obligation to provide a defense
to plaintiffs in that litigation. The trial court did not address the significance
of the exclusions cited by the insurers nor that Blue Cross/Blue Shield was
seeking punitive damages in addition to reimbursement. The trial court recognized, however, that
Princeton and MIIX could not control the defense of the Blue Cross/Blue Shield
litigation because their interests in that litigation were divergent from the interests of
their insureds. Relying on Burd v. Sussex Mutual Insurance Co.,
56 N.J. 383
(1970), it included in its order a provision that the duty to defend
the Blue Cross/Blue Shield action was "converted into a duty to reimburse defense
costs incurred by Plaintiffs in the Blue Cross Action, the scope of which
duty shall be determined in the future." We granted leave to appeal from
that order.
Before proceeding to an analysis of the question, we note the well-settled principles that must guide any interpretation of policies of insurance. The general principles of insurance contract interpretation were set out by the Supreme Court in Zacarias v. Allstate Ins. Co., 168 N.J. 590 (2001).
In the first instance, the words of an insurance policy are to be given their plain, ordinary meaning. In the absence of any ambiguity, courts should not write for the insured a better policy of insurance than the one purchased. However, insurance policies are contracts of adhesion and as such, are subject to special rules of interpretation. When there is ambiguity in an insurance contract, courts interpret the contract to comport with the reasonable expectations of the insured, even if a close reading of the written text reveals a contrary meaning. The objectively reasonable expectations of applicants and intended beneficiaries regarding the terms of insurance contracts will be honored even though painstaking study of the policy provisions would have negated those expectations.
. . . .
[I]n enforcing an insurance policy, courts will depart from the literal text and interpret it in accordance with the insured's understanding, even when that understanding contradicts the insurer's intent, if the text appears overly technical or contains hidden pitfalls, cannot be understood without employing subtle or legalistic distinctions, is obscured by fine print, or requires strenuous study to comprehend.
[Id. at 595, 601 (quotations and citations omitted).]
Principles of insurance contract interpretation "mandate [a] broad reading of coverage provisions, [a]
narrow reading of exclusionary provisions, [the] resolution of ambiguities in the insured's favor,
and [a] construction consistent with the insured's reasonable expectations." Search EDP, Inc. v.
Am. Home Assur. Co.,
267 N.J. Super. 537, 542 (App. Div. 1993), certif.
denied,
135 N.J. 466 (1994). "If there is any doubt, uncertainty or ambiguity
in the phraseology of a policy, or if the phraseology is susceptible to
two meanings, the construction favoring coverage must be adopted." Aetna Ins. Co. v.
Weiss,
174 N.J. Super. 292, 296 (App. Div.), certif. denied,
85 N.J. 127
(1980).
The words of an insurance policy are to be given their plain ordinary
meaning. Harleysville Ins. Co. v. Garitta,
170 N.J. 223, 231 (2001) (holding that
homeowners insurance did not provide coverage in wrongful death suit following a fatal
stabbing). "[E]xclusions are presumptively valid and will be given effect if 'specific, plain,
clear, prominent, and not contrary to public policy.'" Miller v. McClure,
326 N.J.
Super. 558, 565 (App. Div. 1998), aff'd o.b.,
162 N.J. 575 (1999) (quoting
Princeton Ins. Co. v. Chunmuang,
151 N.J. 80, 95 (1997)) (holding defendant not
entitled to coverage under his employer's comprehensive general liability and employer's liability policies
and his own homeowner's policy in a suit alleging sexual harassment and discrimination).
Policy provisions that exclude coverage for intentional wrongful acts are common, accepted as
valid, and consistent with public policy. Harleysville, supra, 170 N.J. at 231. Nevertheless,
exclusions must be narrowly construed, and the insurer bears the burden of proof
that the exclusion applies. Miller, supra, 326 N.J. Super. at 565.
Finally, we are cognizant of the fact that plaintiffs were asserting a duty
to defend, as opposed to a duty to indemnify.
"[T]he duty to defend comes
into being when the complaint states a claim constituting a risk insured against."
Danek v. Hommer,
28 N.J. Super. 68, 77 (App. Div. 1953), aff'd o.b.,
15 N.J. 573 (1954). When the allegations in a complaint correspond with the
language of the policy, the duty to defend arises, irrespective of the claim's
actual merit. Id. at 76-77. If the pleading is ambiguous, doubts should be
resolved in favor of the insured and thus in favor of the duty
to defend. Central Nat'l Ins. Co. v. Utica Nat'l Ins. Group,
232 N.J.
Super. 467, 470 (App. Div. 1989). When multiple alternative causes of action are
stated, the duty to defend will continue until every covered claim is eliminated.
Mt. Hope Inn v. Travelers Indem. Co.,
157 N.J. Super. 431, 440-41 (Law
Div. 1978).
To hold otherwise would be to place upon the insured the burden of
demonstrating in advance of the underlying litigation which of the competing theories of
recovery against it was applicable for purposes of insurance, thereby frustrating one of
the basic purposes of such a clause in the insurance contract protection of
the insured from the expenses of litigation.
[Solo Cup Co. v. Federal Ins. Co.,
619 F.2d 1178, 1185 (7th Cir.),
cert. denied,
449 U.S. 1033,
101 S. Ct. 608,
66 L. Ed.2d 495 (1980).]
The duty to defend
is not abrogated by the fact that the cause of action stated cannot
be maintained against the insured either in law or in fact--in other words,
because the cause is groundless, false or fraudulent. Liability of the insured to
the plaintiff is not the criterion; it is the allegation in the complaint
of a cause of action which, if sustained, will impose a liability covered
by the policy.
[Danek v. Hommer, supra, 28 N.J. Super. at 77.]
We are satisfied that the trial court erred when it found these insurers had a duty to defend these plaintiffs in the Blue Cross/Blue Shield litigation. The policies afford coverage for an injury arising out of the physician's rendering or failure to render professional services, all in the context of a medical incident. In our judgment, Blue Cross/Blue Shield's claim for reimbursement cannot fairly be characterized as a claim for damages arising out of a physician's rendering or failure to render professional services. Nor do we consider its claim for reimbursement to represent a medical incident.
Blue Cross/Blue Shield is not seeking compensatory damages because it was injured by professional services which did not meet the appropriate standard of professional care. Rather, it is seeking reimbursement for sums it alleges were improperly billed to it.
Reported New Jersey cases have discussed what constitutes professional services for purposes of insurance coverage. In Atlantic Mut. Ins. v. Continental Nat. Am. Ins., 123 N.J. Super. 241 (Law Div. 1973), there was a coverage dispute between plaintiff, which had issued a comprehensive general liability policy to an engineering firm and defendant, which had issued a professional liability policy. The engineering firm had been sued by two workers who were injured when a trench they were digging collapsed. After those claims were settled, this litigation was instituted to determine which carrier was obligated for the settlement. The court cited the discussion of what constitutes a professional act contained in 7A Appleman, Insurance Law and Practice § 4504.3.
A 'professional' act or service within a malpractice policy is one arising out of a vocation, calling, occupation, or employment involving specialized knowledge, labor or skill and the labor or skill is predominantly mental or intellectual, rather than physical or manual.
[Id. at 246.]
Based upon that discussion, the trial court concluded that determining the proper method
to brace a trench under construction required the "specialized knowledge and mental skill
of a professional engineer" and thus the malpractice carrier was obligated for the
settlement. Id. at 247.
The New Jersey Supreme Court noted that definition in Princeton Insurance Co. v.
Chunmuang, supra,
151 N.J. 80. Princeton had issued a professional liability policy to
Dr. Chunmuang, who was sued by a patient whom he had molested during
the course of a gynecological exam. The Court concluded that, to the extent
his patient's damages were the result of a criminal act, Princeton was entitled
to invoke the policy's criminal acts exclusion, but that Princeton would be responsible
for so much of her damages as flowed from Dr. Chunmuang's medical malpractice.
It remanded the matter for a hearing on that issue.
We touched tangentially upon the concept of professional services in Records v. Aetna
Life and Casualty Insurance,
294 N.J. Super. 463 (App. Div. 1996), certif. denied,
151 N.J. 463 (1997). In Records, a physician grew agitated when he learned
that a nurse had transferred his patient from a nursing home to a
hospital without informing him. He grabbed the nurse by her arm and led
her into a nearby lounge where he screamed at her and pointed his
finger in her face, all while maintaining his grasp of her arm. Id.
at 465. She alleged her back was injured in the incident and she
sued the physician alleging negligence and assault and battery. The doctor sought a
defense and indemnification from both his homeowner's insurance and his malpractice insurance. Both
carriers denied coverage and the doctor commenced a declaratory judgment action. Id. at
466. We affirmed the trial court's decision that the doctor was entitled to
a defense and indemnification under his malpractice policy but not his homeowner's policy.
Id. at 467.
The malpractice policy provided coverage for "injury arising out of the rendering of
or failure to render . . . professional services." Ibid. Our analysis focused
on the phrase "arising out of." We noted that other insurance coverage decisions
interpreted the phrase broadly to mean "growing out of" or having a "substantial
nexus." Id. at 468. We held that a substantial nexus existed between the
physician's conduct toward the nurse and the care of his patients at the
nursing home. Id. at 467-71. We were not called upon in Records to
determine whether the confrontation between the doctor and the nurse constituted a "medical
incident."
These cases are not dispositive of the issue before us. The Court in
Chunmuang enforced a criminal acts exclusion but recognized also that Chunmuang's patient was
injured as a result of his medical actions. There was no question but
that a "medical incident" had occurred, and the Supreme Court, like this court
in Records, was not called upon to consider what constitutes a medical incident.
Courts in other jurisdictions have recognized that there is a distinction between services
rendered by a professional which involve such "specialized knowledge, labor or skill" and
activities by that same professional rendered as part of conducting business. Harad v.
Aetna Casualty and Surety Co.,
839 F.2d 979 (3d Cir. 1988), is instructive.
Plaintiff Harad was a Pennsylvania attorney who had been sued on a claim
of malicious prosecution. He had two policies of insurance, one issued by Aetna
and one issued by Home Insurance Company. The Aetna policy provided coverage for
liability arising out of the conduct of the insured's business but specifically excluded
coverage for injury arising out of the rendering or failure to render any
professional service. Id. at 983. The court concluded that because the underlying claim
against Harad arose out of his filing a complaint, Aetna was entitled to
rely upon this professional services exclusion. In the course of its opinion, the
court said,
[T]he practice of law, as other similarly regulated professional activity in today's world,
has two very different and often overlooked components--the professional and the commercial. The
professional aspect of a law practice obviously involves the rendering of legal advice
to and advocacy on behalf of clients for which the attorney is held
to a certain minimum professional and ethical standard. The commercial aspect involves the
setting up and running of a business, i.e., securing office space, hiring staff,
paying bills and collecting on accounts receivable, etc., in which capacity the attorney
acting as businessperson is held to the same reasonable person standard as any
other. Indeed, the professional services and the business distinction drawn by the two
policies and Harad's recognition of the limitations inherent in each is manifested by
the fact that Harad purchased a separate professional liability policy from Home.
[Id. at 985.]
The Harad court cited the same section of Appleman discussed in Atlantic Mutual
Insurance, supra. The Harad court referred, however, to Professor Appleman's concluding remark, "In
determining whether a particular act is of a 'professional nature or a professional
service,' we must look not to the title or character of the party
performing the act, but to the act itself." Id. at 984.
A similar distinction was recognized in Medical Records Associates, Inc. v. American Empire
Surplus Lines Insurance Co.,
142 F.3d 512 (1st Cir. 1998). Plaintiff in that
case was in the business of processing medical records and it was insured
under a professional errors and omissions policy issued by defendant. When it was
threatened with litigation for alleged overbilling, it sought coverage from American Empire. American
Empire, however, declined to afford coverage and this declaratory judgment action resulted. The
First Circuit concluded that plaintiff's billing practices did not constitute professional services and
affirmed a trial court ruling that American Empire's policy did not cover plaintiff's
billing practices. The court said that in its view,
"professional services" . . . embrace those activities that distinguish a particular occupation
from other occupations--as evidenced by the need for specialized learning or training--and from
the ordinary activities of life and business.
. . . .
[O]ur view [is] that the billing is most sensibly seen as either a
separate service provided by Medical Records for the hospitals or, as the district
court found, an incidental part of the business--but not the profession--of medical records
processing. As in most other businesses, the bill is an effect of the
service provided, not part of the service itself.
[Id. at 515-16.]
Recently, the Appeals Court of Massachusetts came to a similar conclusion in Reliance
National Insurance Co. v. Sears, Roebuck & Co.,
792 N.E.2d 145 (2003). Daniel
Goldstone was a Massachusetts attorney who was sued by Sears for fraudulent billing
practices. Goldstone had a professional liability insurance policy issued by Reliance, but it
declined coverage in the lawsuit filed by Sears. In finding for Reliance, the
court said,
[T]he billing function of a lawyer is not a professional service. Billing for
legal services does not draw on special learning acquired through rigorous intellectual training.
. . . The billing function is largely ministerial. There are elements of
experience and judgment in billing for legal services, but the same goes for
pricing shoes.
[Id. at 648.]
See footnote 2
The parties' research, as well as our own, has turned up two federal
district court decisions which considered related issues but reached differing conclusions,
Princeton Insurance
Co. v. Kosoy, 1
999 WL 79055 (E.D. Pa. 1999), aff'd without opinion,
281 F.3d 223 (3d Cir. 2001), and Matrix Health Management v. Western World Insurance
Co., 1
993 WL 276842 (E.D. Pa. 1993), aff'd, 1
994 WL 378986 (3d Cir
1994). Defendant Kosoy was a chiropractor who rendered treatment for a period of
time to John Seltzer. After the treatment ceased, Kosoy continued to send bills
to Liberty Mutual Insurance Company for services he had not performed and the
bills were routinely paid. Seltzer later began suit against Kosoy, claiming that as
a result of Kosoy's improper billing, he had been denied workers' compensation benefits.
Princeton had issued a professional liability policy to Kosoy but it refused to
provide a defense or indemnification to Seltzer's suit and it began a declaratory
judgment action. The district court granted Princeton's motion for summary judgment, saying "[t]he
Seltzer complaint alleges claims for negligence, fraud and breach of contract arising solely
out of the billing practices of Dr. Kosoy's chiropractic business. There is no
claim that conceivably could be deemed to be a 'medical incident' as that
term is defined in the policy." Id. at *3.
In Matrix, on the other hand, plaintiff was sued by Travelers Insurance Company
and the Railroad Employees National Health and Welfare Plan based upon an alleged
fraudulent billing scheme to collect money for in-patient psychiatric services that were unnecessary
and other health care services which were not rendered. Matrix had a professional
liability policy with Western World, which refused to provide a defense to the
underlying action. Matrix then brought its declaratory judgment action. The Court of Appeals
affirmed the District Court's finding that Western was obligated to provide a defense
to Matrix. It noted that the underlying complaint referred to "other violations of
the Plan," which could be interpreted to include allegations of negligence, which would
trigger the duty to defend.
One other Third Circuit case must be noted, Visiting Nurse Association v. St.
Paul Fire & Marine Ins. Co.,
65 F.3d 1097 (3d Cir. 1995). Visiting
Nurse Service had both professional liability and comprehensive general liability insurance policies issued
by St. Paul. It was sued by a competitor, American Health Systems, Inc.,
under various theories, including antitrust and RICO claims. Visiting Nurse Service sought coverage
under both St. Paul policies. The trial court found that St. Paul was
obligated to defend under the professional liability policy and St. Paul appealed. The
Court of Appeals reversed, relying on the distinction between professional and commercial activities
described in Harad. The court noted that the allegations against Visiting Nurse Service
"stem[med] from [its] effort to operate its business, not from any professional services
that were or should have been provided by the discharge planners, and thus
do not even potentially fall within the policy's coverage." Id. at 1102.
We consider the distinction recognized by the Third Circuit in Harad, Visiting Nurse
Association and Kosoy between professional and commercial activities to be entirely valid. The
conduct at issue in the Blue Cross/Blue Shield litigation related entirely to plaintiffs'
commercial activities running their business enterprises and did not involve a medical incident.
It is important to recognize what is at issue in the Blue Cross/Blue
Shield litigation. Blue Cross/Blue Shield is seeking reimbursement from parties it alleges did
not comply with the terms of the service provider agreements they had with
Blue Cross/Blue Shield. There is no claim asserted there on behalf of a
patient alleging that the patient was injured as a result of receiving psychiatric
care that did not comply with the appropriate standard of care. Such a
claim would arise out of a rendering or failure to render professional services
and would fall within the coverage terms of these policies.
We have concluded that the billing practices of plaintiffs, which are at the
heart of the Blue Cross/Blue Shield litigation, do not constitute professional services and
any liability which may be imposed upon plaintiffs in that litigation cannot be
considered the result of a medical incident arising out of supplying or failing
to supply professional services. Accordingly, Princeton and MIIX have no obligation to provide
a defense to plaintiffs in the Blue Cross/Blue Shield litigation. The order under
review is reversed.
Footnote: 1
Plaintiffs also joined as defendants Travelers Insurance Company, Fireman's Fund Insurance Company
and Atlantic Mutual Insurance Company, all of which had issued comprehensive general liability
policies to plaintiffs. The trial court granted those insurers summary judgment, holding that
economic loss did not constitute property damage and that the claim for reimbursement
did not arise out of an "occurrence" as defined within those policies. Plaintiffs
did not seek leave to appeal from that determination.
Footnote: 2
The court recognized in a footnote that certain aspects of billing for legal
services might entail specialized knowledge or skill if it were structured to account
for tax consequences. We do not consider that limitation to detract from the
validity of the court's holding or its applicability here.