Lesniakowski v. Amerada Hess Corp.

• Decision Date: 10 June 1988
• Citation: 542 A.2d 940,225 N.J.Super. 416
• Parties: Stanley J. LESNIAKOWSKI and Carol Lesniakowski, Plaintiffs, v. AMERADA HESS CORPORATION, Dover Corporation and Youngman & Cuff Defendants. AMERADA HESS CORPORATION, Third-Party Plaintiff-Respondent, v. FORUM INSURANCE COMPANY, Third-Party Defendant-Appellant.
• Court: New Jersey Superior Court — Appellate Division

Page 416

225 N.J.Super. 416

542 A.2d 940

Stanley J. LESNIAKOWSKI and Carol Lesniakowski, Plaintiffs, v. AMERADA HESS CORPORATION, Dover Corporation and Youngman &

Cuff Defendants.

AMERADA HESS CORPORATION, Third-Party Plaintiff-Respondent, v. FORUM INSURANCE COMPANY, Third-Party Defendant-Appellant.

Superior Court of New Jersey Appellate Division.

Argued April 18, 1988.

Decided June 10, 1988.

Harry S. Karpen, Jersey City, for third-party defendant-appellant Forum Ins. Co. (Harry S. Karpen on the brief).

Robert F. Ball, Iselin, for third-party plaintiff-respondent Amerada Hess Corp., (Britt, Riehl & Spudic, Freehold, attorneys; Robert F. Ball, Iselin, on the brief).

No other party participated or filed a brief.

Before Judges PETRELLA and DREIER.

The opinion of the court was delivered by

PETRELLA, P.J.A.D.

This appeal involves a dispute regarding the obligation to provide a defense and coverage for an accident which occurred while a tank trailer owned by Narrows Carriers, Inc. (Carrier) was being loaded with gasoline by its driver at Amerada Hess Corporation's (Amerada) plant. The underlying action brought by the trailer driver, Stanley J. Lesniakowski, and his wife, Carol Lesniakowski, who asserted a per quod claim, was settled without prejudice to the resolution of the insurance coverage issue raised by Amerada's third-party complaint. The issue on appeal is whether Amerada or Forum Insurance Company (Forum), insurer of Carrier (the operator of the trailer), is responsible for providing a defense to Amerada as an "insured" and coverage of plaintiffs' damages. The trial judge determined on cross-motions for summary judgment that Forum was responsible for coverage for the accident because plaintiff Lesniakowski was an additional insured under the "loading and unloading" provision of its liability policy.

Lesniakowski was loading a tank trailer with gasoline at Amerada's plant in Port Reading when he fell off the top of the trailer's tank and was injured. In order to load a tank trailer with gasoline, it must be driven into a loading bay over which hangs a loading rack. The loading rack consists of three meters and spillers. Each spiller, which is best described as an arm, provides different types of gasoline. Once Lesniakowski positioned his truck under the appropriate spiller, he climbed on top of the truck by using a metal ladder attached to the rear of the truck and leading to a 15 inch wide catwalk along the top length of the trailer's tank. The driver positions the spiller by using an air control valve attached to the spiller that enables the spiller to be maneuvered either up or down.

The loader must unhook a chain that holds the spiller and then position the spiller over one of the four compartments in the trailer's tank that is being filled. Ordinarily the spillers are supported by pneumatic pressure and the hook and chain are used as safeguards to prevent the spiller from falling into the path of a truck in the event of pneumatic failure. The chain is attached to a building support beam and holds the spiller up so trailers can enter the loading bay. Once the hook is removed from the spiller it is usually placed in a small cylinder although it may be allowed to hang down. The number of gallons of gasoline to be pumped into the compartment is preset by the meter. Once the spiller is locked in place in the compartment dome the loader pushes a button and the tank is automatically loaded to the amount of preset gallonage. When the compartment is filled, the spiller is raised from the dome and the safety hook is reconnected.

According to the deposition of Amerada's Vice President of Terminals, if another compartment in the tank must be filled, the loader should reposition his trailer under the appropriate spiller. He testified, however, that it is possible to fill an additional compartment without moving the truck by pulling the spiller from side to side. He did not know if the drivers were instructed about use of the safety hooks and chains on the spillers. A sign entitled "Vapor Recovery Systems Loading Instructions" which is in the area of the spiller does not include any instruction for positioning the tank trailer before loading and does not refer to use of the safety hook and chain.

Lesniakowski had driven his tank trailer into the loading bay in order to load unleaded gasoline in compartments numbered two and four. He proceeded to load compartment number four which was located exactly under the unleaded spiller. The unleaded spiller was at one end of the row of three spillers. The middle spiller pumped premium unleaded gasoline and the third spiller pumped regular leaded gasoline.

After he had loaded the fourth compartment, Lesniakowski attempted to load the second compartment without moving the trailer, but by moving the premium spiller out of the way and pulling the unleaded spiller over to the dome of the second compartment. In order to pull the unleaded spiller to the second compartment, Lesniakowski had to first unhook the chain holding the middle spiller (for premium gas) which was located between the unleaded spiller over the fourth compartment and the second compartment. He put the hook and chain from the middle spiller in its cylinder. Although he did not see the hook slip out of the cylinder, Lesniakowski claimed that it slipped out. As he pulled the spiller from compartment four to compartment two, the hook from the middle spiller caught the unleaded spiller which he was pulling. When the hook caught the spiller, Lesniakowski lost his balance and fell off the truck because the spiller would no longer move when he pulled it.

According to plaintiff's deposition, Amerada never instructed the drivers about use of the hooks and chains on the spillers. Lesniakowski stated that the original hooks broke because they were not durable enough to bear the weight of the spiller. He testified that these smaller hooks were replaced by larger hooks as they broke. These larger hooks did not fit into the cylinders because the cylinders were designed for the smaller hooks.

Plaintiff's complaint alleged ¹ that his injuries were caused because Amerada "failed to provide a safe place for the plaintiff to work, in that the rig [spiller] was makeshift, dangerous and unsafe."

Amerada's third-party complaint and amended third-party complaint sought recovery against Carrier based on the assertion that Forum's policy afforded a defense and required it to indemnify Amerada in the circumstances involved in the allegations of the complaint. The third-party complaint as well as an amended third-party complaint asserted that:

Under the provisions of such policy ... and the policy interpretation of the Courts of the State of New Jersey, an accident occurring during the loading of a truck on premises of a third-party such as Amerada Hess Corporation requires that such insurance company afford a defense to indemnify Amerada Hess Corporation in the circumstances herein for any judgment that may be obtained against it.

On this appeal Forum argues that its liability policy insuring the trailer does not provide coverage. It contends that Amerada conceded its negligence as alleged in plaintiff's complaint when it settled with plaintiff by entry of a judgment. Forum thus argues that plaintiff's injuries were not caused by a "use" of the trailer. Alternatively, Forum argues that its policy does not apply to Amerada because it is not an assured who suffered either personal injury or property damage.

We reject Forum's argument that the settlement "consent judgment" ² should be considered an admission of liability. The judgment merely memorialized the settlement in a more formal manner. The parties to this appeal agreed to litigate the coverage issue thereafter, and the issue was thus preserved despite the settlement. See Vassallo v. Bell, 221 N.J.Super. 347, 355-356, 534 A.2d 724 (App.Div.1987). Unlike Stier v. Shop-Rite of Manalapan, 201 N.J.Super. 142, 149, 492 A.2d 1055 (App.Div.1985), the judgment neither admitted nor determined liability. Nor was there a fact-finding which could serve as the basis of collateral estoppel. See George M. Brewster & Son v. Catalytic Const. Co., 17 N.J. 20, 34-35, 109 A.2d 805 (1954). But see Public Service Elec. & Gas Co. v. Waldroup, 38 N.J.Super. 419, 426, 119 A.2d 172 (App.Div.1955). Indeed, a factual determination of negligence or the cause of plaintiff's injury would have made clear whether Forum's policy applied under the test set forth in Forsythe v. Teledyne Turner Tube, 209 N.J.Super. 608, 616, 508 A.2d 1156 (App.Div.1986).

Amerada argues that there is no factual ³ support for Forum's allegation (and impliedly plaintiffs' claim) that the hook and chain assembly was negligently maintained. Amerada also argues that Forum's liability policy, which provides coverage for additional insureds during the loading and unloading process, applies because plaintiff's accident occurred as the direct result of his own negligence in pulling the spiller during what it asserts is an integral part of the loading process. However, because of the applicability to plaintiff of workers' compensation and the policy exclusion relative thereto, it is clear the policy did not provide coverage to plaintiff, and he never so asserted.

The applicable automobile policy coverage provision of Forum's policy defines the persons insured in the following fashion:

Each of the following is an insured under this insurance to the extent set forth below:

(a) The named insured;

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(c) any other person while using an owned automobile or a hired automobile with the permission of the named insured, provided his actual operation or (if he is not operating) his other actual use thereof is within the scope of such permission, but with respect to bodily injury or property damage arising out of the loading or unloading thereof, such other person shall be an insured only if he is:

(1) a lessee or...