SYLLABUS
(This syllabus is not part of the opinion of the Court. It has
been prepared by the Office of the Clerk for the convenience of the
reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not
have been summarized).
[NOTE: This is a companion case to Pinto v. New Jersey Manufacturers Insurance Company, et al. also decided today ]
Argued October 27, 2004 -- Decided June 6, 2005
PER CURIAM
This appeal involves the application of an underinsured motorist (UIM) step-down clause in an employer’s business automobile policy to a case in which an employee has been injured in a covered vehicle in a work-related accident.
Thomas Murawski sustained serious personal injuries on March 14, 2000, when the truck
in which he was riding was struck by a vehicle driven by Rufus
Howard. The accident took place during the course of Murawski’s employment for Belafsky
Roofing and Sheet Metal Company (Belafsky), in a truck owned by Belafsky. Murawski
settled the claim with Howard for the $50,000 liability limit of Howard’s personal
automobile insurance policy and then sought UIM coverage under Belafsky’s CNA policy.
The CNA policy provided UIM coverage of one million dollars for named insureds.
Murawski was not listed as a “named insured” on the policy nor was
he otherwise identified anywhere in the policy. The named insureds on the CNA
policy were two corporate entities. Murawski was an “insured” under the CNA policy
for purposes of UIM coverage because he was occupying a covered auto at
the time of the accident. Although Murawski did not own a vehicle and
was not a licensed driver (and thus did not have his own automobile
insurance policy), CNA claimed that the step-down provision governing “insureds” applied to Murawski
because Murawski was insured as a resident relative under his mother’s Allstate automobile
policy, which carried a UIM limit of $100,000. Thus, CNA sought to demonstrate
that Murawski maintained a dual residency, living both with his girlfriend and with
his mother, and accordingly the “limit of liability” for UIM coverage under the
employer’s policy should be stepped-down to $100,000, the amount of coverage under the
mother’s policy.
Murawski filed a motion for summary judgment alleging that the policy was ambiguous
in respect of his status as a “named insured.” The trial court found
ambiguity and resolved the ambiguity in respect of who was intended to be
covered as a “named insured” in favor of Murawski. The Appellate Division reversed
and remanded the case for further proceedings on whether Murawski resided with his
mother so as to satisfy the “family member” criterion of the step-down provision.
The Court granted Murawski’s petition for certification.
Held: For the reasons expressed in Pinto, we affirm the enforceability in general of
step-down provisions in respect of UIM coverage, provided the insurance contract language is
clear. Murawski was not a “named insured” nor could he reasonably have expected
to be based on the policy’s language.
1. The declaration sheet of the CNA policy provided UIM coverage of one
million dollars for named insureds. Murawski was not listed as a “named insured”
on the policy nor was he otherwise identified anywhere in the policy. The
named insureds on the CNA policy were two corporate entities. On these facts,
as in Pinto, we hold that
Murawski was not a “named insured” nor could he reasonably have expected to
be based on the policy’s language. (p. 3)
Judgment of the Appellate Division is AFFIRMED. The matter is REMANDED to the
Law Division.
JUSTICE ZAZZALI filed a separate DISSENTING opinion in which JUSTICE ALBIN joins. It
simply may not be possible for a company in the construction industry to
designate an employee as a named insured; accordingly, the failure to name individual
employees in the policy does not suggest that the company intended to limit
coverage for its employees and so the Court should construe the policy’s reference
to the corporations as the named insureds to encompass all of the corporations’
current employees on a given date.
CHIEF JUSTICE PORITZ and JUSTICES LaVECCHIA, WALLACE and RIVERA-SOTO join in this opinion.
Justice Zazzali filed a separate dissenting opinion in which Justice Albin joins. Justice
Long did not participate.
SUPREME COURT OF NEW JERSEY
A- 92 September Term 2003
THOMAS MURAWSKI,
Plaintiff-Appellant,
v.
CNA INSURANCE COMPANY,
Defendant-Respondent.
Argued October 27, 2004 – Decided June 6, 2005
On certification to the Superior Court, Appellate Division (Murawski v. CNA
Insurance Company).
Robert G. Goodman argued the cause for appellant (Palmisano & Goodman, attorneys; John
T. Brost, on the briefs).
Jerald J. Howarth argued the cause for respondent CNA Insurance Company (Hahn &
Howarth, attorneys).
Gerald H. Baker argued the cause for amicus curiae, Association of Trial Lawyers
of America–New Jersey (Baker, Garber, Duffy & Pedersen, attorneys).
PER CURIAM
This appeal is the companion to Pinto v. New Jersey Manufacturers Insurance Company,
___ N.J. ___ (2005), also decided today. Like Pinto, this case involves the
application of an uninsured motorist (UIM) step-down clause in an employer’s business automobile
policy in respect of an employee who has been injured in a covered
vehicle in a work-related accident. For the reasons expressed in our decision in
Pinto, supra, we affirm the enforceability in general of step-down provisions in respect
of UIM coverage, provided the insurance contract language is clear. Because the CNA
Insurance Company business auto policy involved herein defined “insured” and limited UIM coverage
using the same language as that in the NJM policy at issue in
Pinto, supra, its meaning is clear and enforceable. The only question remaining is
its applicability on the facts of this appeal.
Plaintiff Thomas Murawski sustained serious personal injuries on March 14, 2000, when the
truck in which he was riding was struck by a vehicle driven by
Rufus Howard. The accident took place during the course of Murawski’s employment for
Belafsky Roofing and Sheet Metal Company (Belafsky), in a truck owned by Belafsky.
Murawski settled the claim with Howard for the $50,000 liability limit of Howard’s
personal automobile insurance policy and then sought UIM coverage under Belafsky’s CNA policy.
The Declarations Sheet of the CNA policy provided UIM coverage of one million
dollars for a premium of $1,676. Murawski was not listed as a “named
insured” on the policy nor was he otherwise identified anywhere in the policy
as a driver or user of Belafsky’s insured vehicles. The named insureds on
the CNA policy were two corporate entities: Belafsky Roofing & Sheet Metal Co.
Inc. and SBMJ Inc. The only natural persons listed were Jody and Mitchell
Ruthberg, who were the principals of Belafsky, and their respective spouses. Those individuals
were identified specifically as insureds pursuant to the terms of the “Broadened Personal
Injury Protection (PIP) Coverage” and “Drive Other Car Coverage” endorsements to the policy.
On these facts, as in Pinto, we hold that Murawski was not a
“named insured” nor could he reasonably have expected to be based on the
policy’s language.
That said, Murawski obviously was an “insured” under the CNA policy for purposes
of UIM coverage because he was occupying a covered auto at the time
of the accident. Although Murawski
did not own a vehicle and was not
even a licensed driver (and thus did not have his own automobile insurance
policy), CNA nonetheless claimed that the step-down provision applied because Murawski was insured
as a resident relative under his mother’s Allstate automobile policy, which carried a
UIM limit of $100,000. Thus, CNA sought to demonstrate that Murawski maintained a
dual residency, living both with his girlfriend and with his mother, and accordingly
the “limit of liability” for UIM coverage under the employer’s policy should be
stepped-down to $100,000, the amount of coverage under the mother’s policy. Discovery on
the dual residency issue was curtailed when Murawski filed a motion for summary
judgment alleging that the policy was ambiguous in respect of his status as
a “named insured.”
The trial court found ambiguity because in its view the “step-down” provision could
be interpreted, in the absence of an individual named insured, to cover all
employees of the company or to cover no employee of the company. It
resolved the ambiguity in respect of who was intended to be covered as
a “named insured” of the corporation in favor of Murawski. The Appellate Division,
in an unpublished opinion, reversed:
The UM/UIM clause is clear, unambiguous and uncontroverted by any other clause contained
in the CNA business auto policy. No ambiguity was created by the naming
of the Ruthbergs as individual named insureds in the Broadened PIP Coverage endorsement.
Although clearly an “insured” under CNA’s business auto policy by reason of his
occupation of a vehicle insured under that policy, there is no basis to
conclude that Murawski was an “individual named insured” under that policy.
The panel remanded the case for further proceedings on whether Murawski resided with
his mother so as to satisfy the “family member” criterion of the step-down
provision.
We granted Murawski’s petition for certification,
180 N.J. 152 (2004), and now
affirm the judgment of the Appellate Division substantially for the reasons expressed herein
and in our decision in Pinto, supra. T
his matter is remanded to the
Law Division for further proceedings on the sole factual issue remaining.
CHIEF JUSTICE PORITZ and JUSTICES LaVECCHIA, WALLACE, and RIVERA-SOTO join in this opinion.
JUSTICE ZAZZALI filed a separate dissenting opinion in which JUSTICE ALBIN joins. JUSTICE
LONG did not participate.
SUPREME COURT OF NEW JERSEY
A- 92 September Term 2003
THOMAS MURAWSKI,
Plaintiff-Appellant,
v.
CNA INSURANCE COMPANY,
Defendant-Respondent.
JUSTICE ZAZZALI, dissenting.
The majority opinions in both Pinto v. New Jersey Manufacturers Ins. Co., ___
N.J. ___ (2005), and in this appeal represent principled efforts to address an
important question, but I would reach different resolutions of these matters. For the
reasons that I express in my dissent in Pinto, supra, I respectfully disagree
with the majority's opinion. I add only the following.
According to the majority, Murawski cannot recover UIM benefits under his employer’s auto
insurance policy because he is not a named insured. The concerns that I
identify in my Pinto dissent apply to this matter as well because this
policy contains an ambiguous provision identical to the one at issue in Pinto.
However, the argument favoring full UIM coverage applies with even greater force here
because, as a practical matter, it is nearly impossible for an employer such
as Belafsky to designate employees by name in its policy.
Identifying individual employees in the policy would require Belafsky to amend its policy
each time it hires or loses an employee. As Murawski argues, that requirement
would be particularly onerous in these circumstances because Belafsky’s employees are members of
a construction trade, apparently roofers. In the construction industry, it is common for
changes in the employee complement to occur on a regular basis, sometimes daily.
To meet its staffing needs for a project, Belafsky may obtain employees from
the local hiring hall, recall former employees, or hire “off the street.” The
fact that construction employees often commence work early in the morning, long before
insurance agencies open for business, further hinders the ability of an employer to
amend the policy on a continuing basis. It simply may not be possible
for Belafsky to designate an employee as a named insured in those early
hours. Accordingly, the failure to name individual employees in the policy does not
suggest that Belafsky intended to limit coverage for its employees. Rather, given the
constantly changing employee roster, we should construe the reference to the corporation as
the named insureds to encompass all of Belafsky’s current employees on a given
date.
I therefore would hold that Belafsky likely intended to purchase a policy that
covered all of its employees. In fact, the trial court found that the
“more valid” interpretation of the policy is that Murawski’s employer intended that “every
employee be a named insured rather than [that] no employee be a named
insured.” However, even if there is doubt in that regard, principles of statutory
construction require us to resolve that ambiguity in favor of Murawski. See, e.g.,
Botti v. CNA Ins. Co.,
361 N.J. Super. 217, 224 (App. Div. 2003).
Because I believe that Murawski is a named insured, I would not remand
for a determination whether he is a resident of his mother’s household and,
therefore, covered by her auto insurance. Instead, I would enter judgment in favor
of Murawski and allow him to recover full UIM benefits under Belafsky’s insurance
policy.
Justice Albin joins in this dissent.
SUPREME COURT OF NEW JERSEY
NO. A-92 SEPTEMBER TERM 2003
ON CERTIFICATION TO Appellate Division, Superior Court
THOMAS MURAWSKI,
Plaintiff-Appellant,
v.
CNA INSURANCE COMPANY,
Defendant-Respondent.
DECIDED June 6, 2005
Chief Justice Poritz PRESIDING
OPINION BY Per Curiam
CONCURRING/DISSENTING OPINIONS BY
DISSENTING OPINION BY Justice Zazzali
CHECKLIST