Viger v. Commercial Ins. Co. of Newark, N.J., No. 82-3128

• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
• Writing for the Court: Before GIBBONS, SLOVITER and BECKER; SLOVITER
• Citation: 707 F.2d 769
• Decision Date: 19 May 1983
• Docket Number: No. 82-3128
• Parties: Sarah VIGER, et al. v. COMMERCIAL INSURANCE COMPANY OF NEWARK, NEW JERSEY, Appellant.

Page 769

707 F.2d 769 Sarah VIGER, et al.
v.
COMMERCIAL INSURANCE COMPANY OF NEWARK, NEW JERSEY, Appellant. No. 82-3128. United States Court of Appeals,
Third Circuit. Argued on April 25, 1983.
Decided May 19, 1983.

Page 770

Richard A. Kraemer, Philadelphia, Pa., Mark L. Milligan (argued), Christiansted, St. Croix, V.I., for appellant.

Jeffrey L. Resnick (argued), Derek Hodge, Christiansted, St. Croix, V.I., for appellees.

Before GIBBONS, SLOVITER and BECKER, Circuit Judges.

OPINION OF THE COURT

SLOVITER, Circuit Judge.

I.

FACTS

This case originated when plaintiffs filed four separate actions, thereafter consolidated, against St. Croix Fisherman's Cooperative, Inc. d/b/a The Fish Shop, a Virgin Islands corporation engaged in the retail sale of fish and fish products, seeking damages for injuries plaintiffs sustained after consumption of fish purchased at The Fish

Page 771

Shop. The fish was apparently contaminated with ciguatera poisoning. The complaints sought compensatory and punitive damages, alleging, inter alia, breach of warranty, negligence, and failure to warn. After a consent judgment was entered against St. Croix Fisherman's in the consolidated cases for an aggregate amount of $97,500, St. Croix Fisherman's assigned to plaintiffs its rights under an insurance contract with Commercial Insurance Company of Newark, New Jersey.

Plaintiffs then filed this suit against Commercial seeking the $97,500 awarded them in the consent judgment, court costs, and attorneys' fees. In its answer, Commercial disclaimed liability on the grounds, inter alia, that St. Croix Fisherman's had failed to give it proper notice of plaintiffs' claim and that the insurance policy did not provide coverage for the acts complained of. Plaintiffs moved for summary judgment, contending that Commercial was collaterally estopped by the consent decree from contesting St. Croix Fisherman's negligence and that coverage could be determined from the language of the policy. After a hearing, at which the only witness was Commercial's expert, Prof. C. Arthur Jaffe, the trial court granted plaintiffs' motion for summary judgment. Commercial appeals. We reverse on the ground that the injuries at issue were unambiguously excluded from coverage under the policy.

II.

DISCUSSION

A.

Notice

The central question is whether the insurance policy at issue covered the injuries in this case. As a preliminary matter, however, Commercial contends it was given inadequate notice of the claim by St. Croix Fisherman's. The trial court found that "[t]he insurance company was given notice of the complaints filed against the insured" and that there was "no question as to the timeliness or adequacy of this notice." Commercial argues that there was a disputed factual issue as to notice, precluding the grant of summary judgment.

In its answer to the complaint Commercial denied that notice had been given. However, Commercial failed to submit affidavits to contradict the affidavit of St. Croix Fisherman's general manager stating that notice had been given. Naked assertions in the pleadings are insufficient to withstand summary judgment. See Fed.R.Civ.P. 56(e); Ness v. Marshall, 660 F.2d 517, 519 (3d Cir.1981). The mere correspondence between Commercial and plaintiffs' counsel denying notice does not meet the showing required to create a genuine issue of material fact under Rule 56. Accordingly, Commercial's notice argument was properly rejected. ¹

B.

Coverage

We turn to the question of coverage. The policy form listed twenty-six possible coverage parts, with a blank square next to each to be marked to designate the coverage. In this policy, only the square for Owners', Landlords' and Tenants' Liability Insurance was marked. Significantly, one of the other possible coverages was for Completed Operations and Products Liability Insurance, but that coverage was not purchased.

The policy provided that

The company will pay on behalf of the insured all sums which the insured shall

Page 772

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 incidental thereto.

The annual premium for this policy was $40.00 and, as set forth in the policy, was based on the size of the premises, 600 square feet.

Commercial contends that the plaintiffs' claims are not covered by this policy because they were explicitly excluded under the language of exclusion "p", which provided that

This insurance does not apply:

....

(p) to bodily injury or property damage included within the completed operations hazard or the products hazard.

The terms "completed operations hazard" and "products hazard" were defined in the definitions section on the jacket of the policy as follows:

"completed operations hazard" includes bodily injury and property damage arising out of operations or reliance upon a representation or warranty made at any time with respect thereto, but only if the bodily injury or property damage occurs after such operations have been completed or abandoned and occurs away from premises owned by or rented to the named insured....

"products hazard" includes bodily injury and property damage arising out of the named insured's products or reliance upon a representation or warranty...