Apr 4, 2011

Ford Marrin Obtains Dismissal of Subrogation Action

QBE Insurance Company v. Mt. Hawley Insurance Company, Docket No. L-8309-09 (Middlesex County, NJ).

The firm obtained summary judgment dismissing the claims against its client, Mt. Hawley Insurance Company, in a million dollar insurance coverage dispute with QBE Insurance Company involving priority of coverage. QBE sought reimbursement or contribution for defense costs and indemnity paid to settle an underlying personal injury action against a mutual insured.

In the underlying action, plaintiff, the employee of a subcontractor, was injured when he fell into a refrigeration pit while working on the construction of a supermarket. The underlying plaintiff then brought suit against the general contractor, to whom Mt. Hawley had issued a $1M primary GL policy. The general contractor was also added as an additional insured on the subcontractor’s primary GL policy, issued by QBE. After accepting Mt. Hawley’s tender of the general contractor’s defense and indemnity, and after defending the general contractor for more than four years in the underlying action, QBE brought a declaratory judgment action against Mt. Hawley, seeking a declaration that Mt. Hawley’s coverage was primary to QBE based on a claim that the underlying accident did not arise out of the subcontractor’s work.

We successfully argued that QBE’s long delay in pursuing this claim, along with its letter accepting Mt. Hawley’s tender years ago without any reservation of rights, precluded QBE from changing its position and seeking reimbursement or contribution for the nearly $1M paid in settling the underlying action. The New Jersey Superior Court granted Mt. Hawley summary judgment dismissing all claims against Mt. Hawley.

Partner Joseph D’Ambrosio and Associate John Mattoon represent Mt. Hawley Insurance Company in this matter.

By, Joseph D’Ambrosio