Rafanello v. Taylor-Esquivel
| Decision Date | 23 November 2020 |
| Docket Number | DOCKET NO. A-4397-18T2 |
| Citation | 465 N.J.Super. 304,242 A.3d 1228 |
| Parties | Ronald RAFANELLO, Plaintiff, v. Jorge S. TAYLOR-ESQUIVEL, Intek Auto Leasing, Inc., Encompass Insurance and Esurance, Defendants-Appellant, and Encompass Property & Casualty Insurance Company of New Jersey, Third-Party Plaintiff/Appellant, v. American Millennium Insurance Company, NAB Trucking, LLC, AVS Insurance Agency, Inc., Intek Auto Leasing, Inc., Empire Fire and Marine Insurance Company, Third-Party Defendants/Respondent, and Ameriprise Insurance as Subrogee of John Henderson, Fourth-Party Plaintiff, v. NAB Trucking LLC, Jorge Taylor-Esquivel, Intek Auto Leasing Inc., Fourth-Party Defendants. Encompass Property & Casualty Insurance Company of New Jersey, Individually and as Subrogee of Ronald Rafanello, Plaintiffs-Appellants, v. Intek Auto Leasing, Inc., NAB Trucking, LLC, Jorge S. Taylor-Esquivel, American Millennium Insurance Company & Empire Fire & Marine Insurance Company, AVS Insurance Agency, Inc., and Admiral Insurance Company, Defendants-Respondents. Encompass Insurance Company of New Jersey as Subrogee of Neil Prupis and Encompass Insurance Company of New Jersey, Plaintiffs, v. Jorge Taylor-Esquivel, NAB Trucking and Intek Auto Leasing, Inc., Defendants. |
| Court | New Jersey Superior Court — Appellate Division |
Hardin, Kundla, McKeon & Poletto, PA, attorneys for appellant Encompass Property & Casualty Insurance Company of New Jersey; and Steven G. Kraus, attorney for appellant Encompass Property & Casualty Insurance Company of New Jersey, individually and as subrogee of Ronald Rafanello and Neil Prupis (James L. Fant and Steven G. Kraus, Warren, on the joint briefs).
Mintzer Sarowitz Zeris Ledva & Meyers, LLP, attorneys for respondent American Millennium Insurance Company (Kimberly A. Murphy and Christopher A. Gulla, Cherry Hill, on the brief).
Before Judges Fuentes, Rose and Firko.
The opinion of the court was delivered by
FIRKO, J.A.D.
Defendant and third-party plaintiff Encompass Property & Casualty Insurance Company of America (Encompass) appeal from a January 18, 2019 order granting summary judgment to third-party defendant American Millennium Insurance Company (AMIC) and denying Encompass's cross-motion for summary judgment as to AMIC. The trial court found that in this multi-vehicle accident involving a commercial dump truck, the step-down provision in the AMIC policy was triggered because defendant Jorge S. Taylor-Esquivel, the dump truck driver, was not listed in the Covered Driver's section of the policy procured by his employer, NAB Trucking, LLC (NAB). The trial court determined that NAB's exposure was capped at $35,000.
The issue on appeal is whether New Jersey law requires a commercial motor vehicle carrier, such as NAB, to provide the minimum insurance coverage amount of $750,000, when engaged in interstate or intrastate commerce, as prescribed by N.J.S.A. 39:5B-32 and N.J.A.C. 13:60-2.1, even in the event an individual is not listed as a covered driver on the policy. We answer in the affirmative and conclude, as a matter of law, that the AMIC insurance policy issued to NAB requires a mandatory minimum insurance coverage amount of $750,000 and the step-down provision in the insured's combined single limit (CSL) policy is not triggered. Therefore, we reverse and remand.
We discern the following facts from the summary judgment record and view them in the light most favorable to the respective non-moving parties. See Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523, 666 A.2d 146 (1995). On September 22, 2015, plaintiff Ronald Rafanello was rear-ended by a dump truck operated by Taylor-Esquivel in West Orange on Route 280, during the course of his employment with NAB. Upon impact, Rafanello's vehicle struck a third motor vehicle owned by plaintiff Neil Prupis. Debris was dumped onto a fourth motor vehicle owned by Angelo Abrego and a fifth motor vehicle owned by fourth-party plaintiff John Henderson. Rafanello suffered personal injuries as a result of the accident. Notably, the dump truck was a 2006 Sterling L-9800 and weighed in excess of 26,001 pounds. NAB leased the dump truck from Intek Auto-Leasing, Inc. (Intek). At the time of the accident, Taylor-Esquivel was hauling a load of dirt obtained from Four Landscaping in New Jersey to Newark.
Encompass is the automobile insurance provider for Rafanello. The policy issued by Encompass to Rafanello provided uninsured and underinsured motorist coverage of $250,000 per person and $500,000 per accident.
In August 2015, NAB, through its insurance broker, AVS Insurance Agency, Inc. (AVS), secured coverage for the dump truck from AMIC. NAB submitted information to AVS about its owner, Jaime Colindres Mejia, and dump truck drivers, Mejia and Taylor-Esquivel. Copies of Taylor-Esquivel's driver's license and social security card were provided to AVS with the intent to include him as a covered driver on the NAB policy.
A Commercial Insurance Application and Supplemental Commercial Application were submitted by AVS on behalf of NAB and listed two additional drivers, Luis Vega and Donald Colindres. While motor vehicle record searches for Vega and Colindres were submitted with the Commercial Insurance Application to AMIC, a motor vehicle search was not submitted for Taylor-Esquivel. Taylor Stroud, an AVS representative, advised NAB that Taylor-Esquivel would not qualify as a covered driver because his driving history was "unacceptable."
The Commercial Insurance Application identified Keasbey as NAB's business location and stated NAB hauled sand and gravel within a "[seventyfive] mile radius." In the Supplemental Commercial Application submitted by NAB, the following answers were given to questions regarding interstate commerce:
At a deposition, AMIC's underwriter acknowledged that based upon NAB's answer on the Supplemental Commercial Application, NAB engaged in "interstate transport."
AMIC issued a Commercial Automobile Policy to NAB for the policy period from August 6, 2015 to August 6, 2016. The policy provided liability coverage of $750,000 per accident on the declarations page. The dump truck involved in the subject accident is identified in the schedule of "Specifically Described Autos." The AMIC policy provides coverage to the "Named Insured," NAB Trucking, and any permissive user of a covered "auto."
The "Who is an Insured" section of the AMIC policy defines the following as "insureds":
The policy also includes a step-down provision, which provides for a maximum coverage limit of $35,000 for liability arising from incidents involving an individual who is not listed as a "Covered Driver" under the policy. Taylor-Esquivel was not listed as a covered driver in the "Schedule of Covered Drivers" section of the policy.
Mejia ultimately signed the policy, which did not include Taylor-Esquivel as a covered driver or an MCS-90 endorsement. On August 6, 2015, AVS issued a Certificate of Liability Insurance representing to Intek that the AMIC policy was issued to NAB and afforded $1,000,000 in liability coverage; included the dump truck involved in the accident; and named Intek as an additional insured under the policy.
On October 19, 2015, Rafanello filed an amended complaint against Taylor-Esquivel, Intek, and Encompass alleging he was entitled to underinsured (UIM) motorist coverage from Encompass because there was insufficient insurance coverage under the AMIC policy issued to NAB. On September 16, 2016, the trial court entered an order permitting AMIC to deposit its $35,000 policy limit into court pursuant to Rule 4:57-1.4 In accordance with the terms of the order, on November 16, 2016, AMIC deposited its $35,000 payment with the Superior Court Trust Fund.
On May 8, 2017, Encompass filed a complaint against AMIC, NAB, Intek, Taylor-Esquivel, and Empire Fire & Marine Insurance Company for reimbursement of Personal Injury Protection (PIP) benefits. On June 26, 2017, AMIC filed an answer to the complaint. Thereafter, on March 27, 2018, Encompass filed a second amended third-party complaint against AMIC, NMAB, AVS, Intek, and Empire. Encompass alleged it was not required to provide underinsured motorist coverage benefits to Rafanello because his claims did not exceed the $1,000,000 policy limit required under the lease agreement between NAB and Intek. On April...
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