Viger v. Commercial Ins. Co. of Newark

• Decision Date: 16 February 1982
• Docket Number: Civil No. 1979/204
• Parties: SARAH VIGER, MARCELINE STEELE, AROL STEELE, PATRICIA L. STEELE, NORMA WARBINGTON, ANDREW CHARLES WARBINGTON, JOSE MARTINEZ, ERIC FRANK and ROSITA FRANK, Plaintiffs v. COMMERCIAL INSURANCE COMPANY OF NEWARK, NEW JERSEY, Defendant
• Court: U.S. District Court — Virgin Islands

19 V.I. 40

SARAH VIGER, MARCELINE STEELE, AROL STEELE,

PATRICIA L. STEELE, NORMA WARBINGTON, ANDREW

CHARLES WARBINGTON, JOSE MARTINEZ, ERIC

FRANK and ROSITA FRANK, Plaintiffs v. COMMERCIAL INSURANCE COMPANY OF NEWARK,NEW JERSEY, Defendant

Civil No. 1979/204

District Court of the Virgin Islands Div. of St Croix

February 16, 1982

Motion by plaintiff for summary judgment in an action on an insurance policy issued to a fish shop which had been held liable for selling plaintiffs contaminated fish. The District Court, Silverlight, J., held that since construing all reasonable doubts as to the extent of coverage in favor of the insured, the insurer was liable to plaintiffs, the motion would be granted.DEREK M. HODGE, ESQ. and JEFFREY L. RESNICK, ESQ., Christiansted, St. Croix, V.I., for plaintiffs

DAVID O'BRIEN, ESQ., Christiansted, St. Croix, V.I., for defendant

SILVERLIGHT, Judge

MEMORANDUM OPINION

This matter is before the Court on Plaintiffs' Motion for Summary Judgment. For the reasons set forth below, the motion will be granted.

FACTS

The case arises out of four separate actions by plaintiffs against the St. Croix Fisherman's Cooperative, Inc. d/b/a The Fish Shop (hereinafter "The Fish Shop"). Between November 24, 1976, and April 11, 1977, plaintiffs sued The Fish Shop for injuries sustained from consumption of fish purchased at the store.¹ The fish was contaminated with ciguatera poisoning.²

Defendant, The Fish Shop, answered in each case³ except in Warbington, et al. v. St. Croix Fisherman's Corp., Inc., Civil No. 58/1977. A default was entered in that matter.⁴ The cases were consolidated by court order on April 30, 1979, and a consent judgment for $97,500.00 was entered in favor of plaintiffs.⁵ The Fish Shop's insurance coverage at all times pertinent hereto, was carried by Commercial Insurance Company, defendant in this action. After entry of judgment all rights under that policy of insurance were assigned to plaintiffs. In assertion of their rights, plaintiffs filed suit against defendant. Commercial Insurance Company denied coverage at the time the original suits were filed, and continues to deny coverage. The company claims that this policy was issued to cover injuries resulting from use of the premises, and injuries off the premises arising from hazards of products sold were not contem-plated. The company alleges exclusion "p" of the policy, as defined by the terms on the jacket, is evidence of this fact. The insurance company was given notice of the complaints filed against the insured. There is no question as to the timeliness or adequacy of this notice. The sole issue before the Court is what effect the exclusions listed in the insurance policy have on the injuries here complained of.

DISCUSSION

The basic coverage in this case is defined by paragraph 1 of the policy:

The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of

A. bodily injury or

B. property damage

to which this insurance applies, caused by an occurrence and arising out of the ownership, maintenance or use of the insured premises and all operations necessary or incident thereto. . . .

The insured was in the business of selling fresh fish to the general public. The use to which the building was put, and from which the injuries sustained arose, is an operation necessary or incidental to "ownership, maintenance or use of the insured premises."

[1, 2] The law recognizes that there is incumbent upon a manufacturer or supplier of goods a duty to warn a consumer of a known or reasonably foreseeable danger or defect. LaBelle v. McCauley Ind. Corp., 649 F.2d 46, 49 (1st Cir. 1981). Section 388 of the Restatement (Second) of Torts defines this area of the law.⁶ "[A] supplier of a chattel has no duty under § 388 to test or inspect or even make a cursory examination to ascertain the existence or nonexistence of a dangerous condition. Section 388 requires only that thesupplier warn of those dangers of which he is actually aware or has information which should make him aware that such a dangerous condition exists." Lockett v. General Electric Co., 376 F.Supp. 1201, 1208 (E.D. Pa. 1974) affd. 511 F.2d 1393 (3d Cir. 1975) (emphasis added); see Moran v. Faberge, Inc., 332 A.2d 11, 15-17 (Md. 1975) (extended discussion of duty to warn).⁷ This Court in Battiste v. St. Thomas Diving Club, Inc., 15 V.I. 184 (D.V.I. 1979) spoke to the question of warning.

Certainly, the continued serving of local fish by Virgin Islands restaurants is a desirable economic and gustatory goal. Unfortunately, the Court cannot ignore the competing concern that patrons of our restaurants should be afforded notice of the risks inherent in the consumption of local delicacies. The alternative is that the restaurants which, however small, are in the better position to spread the risk, must bear that risk. Perhaps the most facile solution would be for menus to contain a warning about the possibility of fish poisoning. This is not a particularly appetizing suggestion, but it would solve the problem of notice at little cost to the restaurant. It can hardly be argued that such a warning would substantially injure the local fish industry since it is a fair statement that many restaurant patrons today order local fish despite their awareness of the danger of fish poisoning. The warning would simply insure that all patrons have the benefit of such knowledge.

Id. at 189-190.

[3] The manner of and time at which the warning must be given will vary according to the product and its use. There can be no dispute here about the adequacy of the warning, since none was given. The duty arose in this case at the time the fish was sold. Ciguatera poisoning is a known danger accompanying the consumption of fresh fish caught in and around the Virgin Islands.⁸ The Fish Shop breached that duty by its failure to warn plaintiffs. That breachoccurred on the premises.⁹ The conditions of coverage in paragraph 1 of the policy have, therefore, been fulfilled.

The exclusion asserted by the insurance company in order to avoid liability does not apply to this case. The "completed operations hazard" and "products hazard" both exclude coverage if the bodily injury or property damage occurs away from the insured premises. A cursory reading of these sections might suggest nonliability on the part of the company. Upon closer examination, however, the analysis utilized requires a result different from that advanced by the insuring company. The duty owed to the plaintiffs and the breach of that duty both took place on the insured premises. The injuries are not then within that class of cases excluded by the defined provision of the policy.

[4] The Court is called upon here to interpret the language of this policy. The actual words used, as well as the manner of presentation may be categorized as confusing and unclear.¹⁰ Exclusion "p" states that insurance does not apply to injury on damage "within the completed operations hazard or the products hazard." The modifying language, defining those terms, however, is contained in the jacket to the policy. In...