WEI-LI TJONG v. PENSKE TRUCK LEASING CO., L.P., et al.

Annotate this Case

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2115-04T32115-04T3

WEI-LI TJONG,

Plaintiff-Appellant,

v.

PENSKE TRUCK LEASING CO.,

L.P., OLD REPUBLIC

INSURANCE COMPANY,

Defendants-Respondents,

and

ALEX IZQUIERDO,

Defendant.

___________________________________________________________

 

Argued November 16, 2005 - Decided June 9, 2006

Before Judges Fuentes and Graves.

On appeal from Superior Court of New Jersey,

Law Division, Essex County, L-06788-04.

Allan Maitlin argued the cause for appellant

(Sachs, Maitlin, Fleming & Greene, attorneys;

Mr. Maitlin, on the brief).

Bruce M. Strikowsky argued the cause for

respondent (Lester Schwab Katz & Dwyer,

attorneys; Mr. Strikowsky and Mark J.

Pastuszak, on the brief).

PER CURIAM

Plaintiff Wei-Li Tjong was a licensed driver operating a truck rented from Penske Truck Leasing Co., L.P. (Penske), when he was involved in a motor vehicle accident in New Jersey with Alex Izquierdo on September 24, 1999. In this declaratory judgment action, plaintiff seeks a judicial declaration that either Penske or its insurer, Old Republic Insurance Company (Old Republic), is required to defend him and to provide him with coverage of $1,000,000 in the personal injury action initiated by Izquierdo. Plaintiff appeals from a summary judgment order in favor of Penske and Old Republic limiting their coverage to $15,000. We affirm.

We have been told that after Tjong filed this appeal, the underlying plaintiff (Izquierdo) settled his claims against Tjong for $115,000. Izquierdo received the $15,000 that Penske had deposited with the clerk of the court, and he also received the sum of $100,000 from Maryland Casualty Company (Maryland), Tjong's personal auto insurance carrier. Tjong therefore has no personal exposure, and the real party in interest is Tjong's personal carrier, Maryland, which seeks to recover its $100,000 settlement expenditure on behalf of Tjong.

The rental agreement between Tjong and Penske provides that Penske will provide liability coverage to Tjong as follows:

IF A TRUCK, primary coverage of $10,000 each person, $20,000 each accident for bodily injury, including death and $5,000 each accident for property damage or with limits of liability up to the requirement of the Financial Responsibility Law or other applicable statute of the state or municipality in which the accident occurred, whichever is greater.

The Old Republic business auto insurance policy issued to Penske also limits the level of coverage available to rentees and lessees of Penske vehicles. Endorsement U2060 A18, entitled "Who Is An Insured," states:

It is agreed Section II-Liability Coverage, A. Coverage, 1. Who Is An Insured of the Business Auto Coverage Form (CA 00 01 (12/93) is amended to include the following:

C. Both lessees and rentees of covered autos as insureds, but only to the extent and for the limits of liability agreed to under contractual agreement with the Named Insured.

The trial court found that the rental agreement between Penske and Tjong and the Old Republic Insurance policy both limited the liability of Penske and Old Republic to the statutory minimum amount of $15,000 per person, $30,000 per accident. See N.J.S.A. 45:21-3; N.J.S.A. 39:6B-1; Agency Rent-A-Car, Inc. v. Indem. Ins. Co. of N. Am., 268 N.J. Super. 319, 322-23 (App. Div. 1993):

Quite frankly, despite the claim that this should be open to further discovery, I find that the issues involved here are quite clear. It's the policy obligations to the renter, based on the agreement and based on the . . . rental agreement and based on the policy. I . . . find . . . nothing but an extremely strained interpretation that could come up with anything, other than the fact that lessees and renters of the policies as insured, are limited to . . . the limits of liability agreed to under the contract; or, alternatively, specifically the minimum limits set forth in the [s]tate, which obviously is 15, 30 in the State of New Jersey.

Under those circumstances, I see nothing against public policy. Anything that prevents an insurance policy from limiting coverage, that's the coverage that the driver knows . . . he's getting, based on the agreement that he signed . . . . There's no misrepresentation or fraud . . . in the rental of the car. They know they're getting the minimum policy. That's what it says in the rental agreement. The insurance policy matches up exactly with that obligation. I find nothing in the policy that would indicate that the . . . renter is entitled to anything above that.

Under the circumstances, I will . . . change it to a motion for summary judgment. But I will grant defendants' motion for summary judgment. And they've already deposited their $15,000 into [c]ourt, which I find to be the policy limits. There's no further issues that need to be addressed in this case.

There is no need to go into their claims practices in the entire State. There is no need for any other documents, other than the rental agreement and the insurance policy. They seem to be the only relevant documents that the [c]ourt needs to consider or the parties need to consider in determining the applicable coverage.

Under the circumstances[,] therefore, the motion will be granted.

We affirm the summary judgment order substantially for the reasons expressed by the trial court. Both the Penske rental agreement and the Old Republic policy limit liability coverage for rentees to the minimum required by statute. A provision in a rental contract that clearly limits the self-insurance obligation of the rental company is enforceable when the rental agreement provides for the statutory minimums. Robinson v. Coia, 183 N.J. 25 (2005), rev'g on dissent, 369 N.J. Super. 336, 348 (App. Div. 2004) (Wecker, J., dissenting); Agency Rent-A-Car, supra, 268 N.J. Super. at 323-25. Similarly, we have enforced a "step-down" provision contained in a liability policy issued to a car rental company, which designated lower limits of coverage for vehicles leased to a rentee. Gen. Accident Group of Ins. Co. v. Liberty Mut. Ins. Co., 191 N.J. Super. 530, 531 (App. Div.), certif. denied, 95 N.J. 192 (1983).

Affirmed.

 

Improperly pled as Wei-Li Tsong.

(continued)

(continued)

5

A-2115-04T3

June 9, 2006

 


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