Estate of Atanasoski v. Arcuri Agency, Inc.
| Decision Date | 06 May 2019 |
| Docket Number | DOCKET NO. A-2991-17T4 |
| Parties | ESTATE OF BORO M. ATANASOSKI, LILLIAN E. CARTER, his wife, individually, and as Administrator and Administrator Ad Prosequendum of the ESTATE OF BORO M. ATANASOSKI, Plaintiffs-Appellants, v. ARCURI AGENCY, INC., ARCURI AGENCY, PETER M. ARCURI, JR., ARCHER A. ASSOCIATES, INC., and ROBERT LANCIOTTI, Defendants-Respondents, and MARY E. ALLEN, Defendant. |
| Court | New Jersey Superior Court — Appellate Division |
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
Before Judges Simonelli, O'Connor and Whipple.
On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-4821-17.
Antonio D. Arthurs argued the cause for appellants (Law Offices of Jeffrey S. Hasson, PC, attorneys; Antonio D. Arthurs, on the brief).
Audrey L. Shields argued the cause for respondents Arcuri Agency, Inc., Arcuri Agency, and Peter M. Arcuri, Jr. (Golden, Rothschild, Spagnola, Lundell, Boylan & Garubo, PC, attorneys; Audrey L. Shields, of counsel and on the brief; Carolynn A. Mulder, on the brief).
Debra M. Krebs argued the cause for respondents Archer A. Associates Inc. and Robert Lanciotti (Keidel, Weldon & Cunningham, LLP, attorneys; Debra M. Krebs, on the brief).
In this insurance broker malpractice matter, plaintiffs Estate of Boro M. Atanasoski (Estate) and Lillian E. Carter1 appeal from the January 29, 2018 Law Division orders granting the motions of defendants Arcuri Agency, Inc, Acuri Agency, Peter M. Arcuri, Jr. (collectively Arcuri), and Archer A. Associates, Inc. and Robert Lanciotti (collectively Archer), to dismiss the complaint with prejudice pursuant to Rule 4:6-2(e). We affirm.
I.
European Bread, Inc., d/b/a Schripps European Bread (Schripps) is in the bread delivery business. Arcuri procured a commercial vehicle liability insurance policy for Schripps with Allstate New Jersey Insurance Company (Allstate), which had a $1 million per accident limit. Archer procured a commercial excess and umbrella liability policy for Schripps with XL/Greenwich Insurance Company (XL) in the amount of $5 million. The XL policy did not provide excess coverage for commercial vehicle liability.
On July 26, 2014, Boro M. Atanasoski (decedent) was struck and killed by a vehicle owned by Schripps and operated by its employee, Joseph Eizaguirre. On August 20, 2014, Carter, the decedent's wife, filed a complaint individually and as administrator ad prosequendum of the Estate against Schripps and Eizaguirre for wrongful death and survivorship.
On July 18, 2017, plaintiff filed a second complaint to include professional negligence claims against Arcuri and Archer.2 Plaintiff alleged that Arcuri failed to advise Schripps of the need for higher primary policy limits and/or excess insurance above the $1 million Arcuri procured with Allstate. Plaintiff alleged that Archer procured a policy that specifically excluded commercial vehicle liability coverage or any claims arising from the use of a motor vehicle despite the fact that Schripps' bread delivery business involved the substantial use of commercial vehicles. The court severed these claims, dismissing the claims against Arcuri and Archer without prejudice and allowing the underlying action to proceed against Schripps and Eizaguirre. The court permitted plaintiff to proceed against the brokers under a separate docket number.
The underlying action settled for $940,000, paid by Allstate. Pursuant to a settlement agreement dated July 25, 2017, plaintiff released Schripps and Eizaguirre from any further claims and specifically agreed not to seek any contribution from them beyond the settlement amount. The settlement agreement contained "[c]ooperation with [c]ontinued [l]itigation," which required Schripps and Eizaguirre "to cooperate with the ongoing litigation, in pursuing claims against the insurance agents or brokers . . . and by providing documents and testifying at deposition or trial." Notably, the parties agreed that the settlement "shall not be construed as an admission of liability on the part of any party to this [a]greement." The settlement was not reduced to a judgment. The court thereafter dismissed the underlying action with prejudice.
On July 18, 2017, immediately prior to the execution of the settlement agreement, plaintiff filed a new complaint asserting insurance broker malpractice claims against Arcuri and Archer. Plaintiff did not join Schripps and Eizaguirre as defendants. Thereafter, Arcuri and Archer each filed a motion to dismiss pursuant to Rule 4:6-2(e).
In granting the motions, the motion judge cited Carter Lincoln-Mercury, Inc., Leasing Div. v. EMAR Group, Inc., 135 N.J. 182 (1994), Werrmann v. Aratusa, Ltd., 266 N.J. Super. 471 (App. Div. 1993), Manukas v. Am. Ins. Co., 98 N.J. Super. 522 (App. Div. 1968), and Eschle v. Eastern Freight Ways, Inc., 128 N.J. Super. 299 (Law Div. 1974), and determined there must be a judgment against the underlying tortfeasors in order to determine if plaintiff's claim was worth in excess of the available $1 million primary Allstate coverage. The judge found there could be no judgment in this case against Schripps and Eizaguirre because plaintiff did not name them as defendants in this matter and settled her claims against them, relinquishing her right to sue them. The judge concluded:
The judge next distinguished Deblon v. Beaton, 103 N.J. Super. 345 (Law. Div. 1968), on which plaintiff relied, noting that Schripps and Eizaguirre had no obligation to help defend any valuation trial, but rather, were obligated to help plaintiff pursue her claims against the brokers. The court further noted that Schripps did not request more than $1 million in commercial auto liability coverage and Arcuri had no duty to procure more than the amount requested.
Regarding Archer, the judge found that even if the XL policy applied to Schripps's commercial vehicles, the excess coverage under the policy would not have been exposed because plaintiff settled within Allstate's primary policy for $1 million. The judge concluded that even if Archer was negligent in not procuring commercial auto liability excess coverage, this caused no damage or financial loss to Schripps related to plaintiff's wrongful death/survivorship claims.
On appeal, plaintiff contends the judge erred in dismissing this matter with prejudice because she asserted a valid cause of action against Arcuri and Archer. Relying primarily on Werrmann and Deblon, plaintiff argues the brokers owed a duty to third parties and she presented facts establishing a breach of duty, proximate causation, and damages. Plaintiff did not address Manukas and Eschle.3
Our review of a dismissal for failure to state a claim pursuant to Rule 4:6-2(e) is de novo, following the same standard as the trial court. Smerling v. Harrah's Entm't, Inc., 389 N.J. Super. 181, 186 (App Div. 2006). Like the trial court, we must search the complaint "in depth and with liberality to determine if there is any 'cause of action [] "suggested" by the facts.'" State v. Cherry Hill Mitsubishi, 439 N.J. Super. 462, 467 (App. Div. 2015) (alteration in original) (quoting Printing-Mart Morristown v. Sharp Elecs. Corp., 116 N.J. 739, 746 (1989)). The inquiry is limited to "examining the legal sufficiency of the facts alleged on the face of the complaint." Ibid. (quoting Printing-Mart Morristown, 116 N.J. at 746). "Dismissal is the appropriate remedy where the pleading does not establish a colorable claim and discovery would not develop one" Ibid. Applying these standards, we discern no reason to reverse.
An insurance broker owes a duty to the insured to act with reasonable skill and diligence in performing the services of a broker. Carter Lincoln-Mercury, 135 N.J. at 189. An insured can establish a prima facie case of negligence against an insurance broker if: (1) the broker neglects to procure the insurance; (2) the broker secures a policy that is either void or materially deficient; or (3) the policy does not provide the coverage the broker undertook to supply. President v. Jenkins, 180 N.J. 550, 569 (2004). However, "an insurance agent ha[s] no duty to advise an insured to consider higher amounts of . . . insurance." Carter Lincoln-Mercury, 135 N.J. at 190. "To succeed in an action against an insurance broker, the plaintiff must prove that in addition to being negligent, the broker's negligence was a proximate cause of the loss." Harbor Commuter Serv., Inc. v. Frenkel & Co., 401 N.J. Super. 354, 368 (App. Div. 2008). The plaintiff must also prove damages. Robinson v. Janay, 105 N.J. Super. 585, 591 (App. Div. 1969).
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