Cynthia S. Betz, Associate, McCarter & English LLP
In Memorial Properties, LLC v. Zurich American Insurance Co., 2012 N.J. LEXIS 682 (N.J. June 28, 2012), the New Jersey Supreme Court affirmed the Appellate Division's decision that a cemetery and crematory were not entitled to insurance coverage for claims arising from the illegal harvesting of human remains. Two insurance policies covering two separate policy periods were at issue and, for different reasons, the court held that neither policy responded to the claims. The Supreme Court held that the operative occurrence occurred during the 2006, which necessarily subjected the claim to an exclusion in the policy applicable to that year only. The court's decision that the occurrence was not triggered during the earlier policy period had significant ramifications on the claim in light of the exclusion. Unfortunately, this decision was reached by the Court without a careful examination of the policy language, which could have led to a different result.
The court relied heavily on its 1984 decision in Hartford Accident & Indemnity Company v. Aetna Life & Casualty Insurance Co., 98 N.J. 18, 27-28 (1984), which held that "[w]hen parties dispute the identity of the operative 'occurrence' for purposes of coverage, the actual damage to the party asserting the claim, not the wrongful at that precipitated that damage, triggers the 'occurrence.'" (2012 N.J. LEXIS 682, at *24-25 (quoting Hartford Accident & Indem. Co. v. Aetna Life & Cas. Ins. Co., 98 N.J. 18, 27-28 (1984)). Although the Court noted that the Harford Accident policy had a "similar" definition of occurrence to those at issue here (Id. at *25), the language of the policies is different enough that a different result may have been reached if those definitions were actually compared. Although the case is specific to its facts and policy language, it is nonetheless an example of an insurance coverage dispute where the examination of each and every term of a policy's relevant provisions could lead to a different result.
Ms. Betz is an associate in the Insurance Coverage group of McCarter & English, LLP, Newark, New Jersey, which focuses on policyholder-side insurance issues. She may be reached at email@example.com.
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