CATHY MARINO v. TARGET STORES

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1142-08T31142-08T3

CATHY MARINO and WILLIAM MARINO (Husband and Wife),

Plaintiffs,

v.

TARGET STORES,

Defendant-Respondent,

and

ARISA REALTY CO., LLC. d/b/a ARISA URBAN RENEWAL CO.,

Defendant-Appellant,

and

T.K. CLEANING, LLC,

Defendant.

 
 

Argued: May 20, 2009 - Decided:

Before Judges C.L. Miniman and Baxter.

On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-6129-05.

Walter F. Kawalec, III, argued the cause for appellant (Marshall, Dennehey, Warner, Cole man & Goggin, attorneys; Mr. Kawalec, on the briefs).

Jeffrey L. O'Hara argued the cause for respondent (Connell Foley, LLP, attorneys; Mr. O'Hara, of counsel; Matthew S. Schultz and Matthew W. Bauer, on the brief).

PER CURIAM

Defendant Arisa Realty Co., LLC, doing business as Arisa Urban Renewal Company, appeals from orders entered on August 31 and October 5, 2007, and September 16, 2008, which granted summary judgment to defendant Target Corporation, improperly sued as Target Stores, on Target's cross-claims and dismissed Arisa's cross-claims, denied reconsideration of the summary judgment, and awarded attorney's fees and costs to Target in the amount of $77,258.85, respectively. We reverse and remand for further proceedings.

This is an action for damages in connection with personal injuries suffered by plaintiff Cathy Marino and loss of consortium suffered by plaintiff William Marino. Upon learning of plaintiffs' claim, Target tendered the claim to Arisa by letter on April 6, 2004. The letter indicated that Arisa had a duty to indemnify and defend Target for the claim. No response to that letter was included in the appendix on appeal.

On August 23, 2005 plaintiffs filed a complaint against Target, Arisa, and TK Cleaning, LLC. They alleged that all three defendants were negligent, careless, or reckless in failing to use reasonable care to inspect and make the sidewalk in front of the Target Store in the Milltown Shopping Center, Milltown, safe for plaintiff, causing her to trip on fall on debris left on that sidewalk, and failed to warn her of same. On September 23, 2005, Target tendered its defense and demanded indemnification from the claims adjuster for Arisa's insurance carrier. On October 18, 2005 The Law Offices of Brian M. Murphy filed an answer on behalf of Target and Arisa. Arisa's carrier, through its adjuster, formally agreed on November 29, 2005, to defend Target under the policy it issued to Arisa. It issued a reservation of rights regarding its duty to indemnify Target under its policy with respect "to control of the accident site at the time of the alleged accident." Thereafter, Target retained its own counsel to defend it instead of the counsel assigned by Target's carrier. The case proceeded through discovery.

Plaintiff testified that on March 24, 2004, she and Cathy Conguista drove to the Target in Milltown, where they parked Conguista's car and began to walk to the Target store. Plaintiff stepped up onto the sidewalk from the parking lot, took two or three steps, and fell down on her side about twenty-five feet from the entrance to the Target store. After she fell, she saw an opaque, circular piece of strapping around her left foot. Although she was initially diagnosed with a contusion, she was later diagnosed with an L-3 compression fracture and a left hip fracture. Conguista corroborated plaintiff's testimony, although she estimated they were about fifteen feet from the entrance to the Target Store when plaintiff fell. She threw the strapping away because she did not want anyone else to trip on it. Neither one of them reported the incident to anyone. Four or five days later, Conguista took plaintiff to the Target store and spoke to a manager and told her what happened.

Photographs of the Target store depict an entryway that projects from the face of the building into the depth of the sidewalk. That entryway has wing walls to the right and left of the four sets of double doors and one central single door. The wing walls are connected with an outward projection of the building's fa ade that creates a roof over the entryway giving customers an area outside the doors that is protected from the weather. Because there is also a door in the wing wall on the right side, it appears that the entryway has significant depth well in excess of the width of the door.

Maureen Reddington, a Target employee, prepared a Guest Incident Information report indicating that on March 31, 2004, plaintiff reported she tripped and fell on March 24, 2004, on a white plastic packing strip on the sidewalk outside the front entrance, breaking her fall with her hands and landing on the left side of her thigh. Reddington indicated on the report that she, Reddington, could not describe the item involved in the incident. She also reported that John Sturdy, the cart attendant, did not recall anything being on the ground on the day of the incident.

At her deposition, Reddington testified that Target did have merchandise with plastic strapping to hold boxes together, which she recalled were yellow rather than opaque white. If an employee saw a plastic strap on the ground outside the store, the employee should pick it up. She testified that customers only use the front entrance and, if one needed assistance getting merchandise to his or her car, an employee would help bring the item to the customer's car, which the customer might pull up to the front of the store.

Sturdy, an employee of Target, was also deposed. He had no recollection of March 24, 2004, but when he sees debris on the sidewalk, he picks it up and throws it away. He stated there are a couple of trash barrels by the front entrance and it was his job to empty them, although another Target employee also empties them when they are filled up. He would periodically check to see if they needed to be emptied and, generally, he would empty them two or three times a day.

Patricia Marambio, also an employee of Target, testified at her deposition that employees were encouraged to clean up debris on the front of the walkway. Target had a twenty-four-hour safety policy at the time of this incident. Although the policy did not specifically extend to the outside of the building, cleaning up the outside was nonetheless encouraged. It was the cart attendants' duty to pick up debris and trash they found outside. Additionally, a Target employee would steam clean the front sidewalks twice a week. This was done before the store opened in the morning. There was a company that cleaned the outside of the store "through the landlord," which she identified as Arisa. She denied having knowledge of whose duty it was to clean the sidewalk.

The premises where plaintiff fell were the subject of a 1998 Operation and Easement Agreement between Target and Arisa. The agreement recites that Target is the owner of Block 84.02, Lot 1.11, on the tax maps of Milltown. Target's property was identified as "the Target Tract" on Exhibit X, a site plan. Arisa, called the "Developer" in the agreement, was the owner of Block 84.02, Lots 1.12 and 1.13, on the Milltown tax maps. Arisa's property was identified as the "Developer Tract" on Exhibit X. The Agreement defined "Tract" as "each legally subdivided portion of the Shopping Center owned by a party." The Target Tract and the Developer Tract, collectively called the "Shopping Center," were contiguous and adjacent.

Because the Tracts were separately owned, one lot by Target and two lots by Arisa, each party granted and conveyed to the other a nonexclusive perpetual easement for the passage of vehicles over and across the parking and driveway areas of their Tract and a similar easement for the passage and accommodation of pedestrians over and across the parking, driveway, and sidewalk areas of each party's Tract. Target also granted and conveyed to Arisa "a non-exclusive perpetual easement" for the parking of vehicles in the fifty-nine parking spaces contained within the area on the Target tract, cross-hatched and designated as "Shared Parking Area" on the Site Plan. Thus, it is readily apparent from the agreement that the Target Tract contained the Target building, sidewalks, and parking lots. Those improvements were all owned by Target.

The Agreement allocated responsibility for maintenance of the Common Area, which was defined as "all areas within the exterior boundaries of the Shopping Center, exclusive of (i) Buildings, and (ii) any Outside Sales Area." The latter term was defined in Article I, 1.9, as follows:

"Outside Sales Area" shall mean those areas, if any, designated on the Site Plan which may be used from time to time for sales, display and/or storage purposes. [If d]uring the period an Outside Sales Area is: . . . (ii) not [being] used, the surrounding barrier, if any, shall be removed by the Occupant and the surface of such area shall be used for Common Area purposes or, if the area is located within a Building Area, for the location of Buildings.

The terms "Building" and "Building Area" were given the following definitions in Article I, 1.2 and 1.3, respectively:

"Building" shall mean any enclosed structure placed, constructed or located on a Tract, which for the purpose of this [Agreement] shall include appurtenant canopies, supports, loading docks, truck ramps and other outward extensions.

"Building Area" shall mean the limited areas of the Shopping Center within which Build ings may be constructed, placed or lo cated without the prior consent or approval of the Approving Parties; Building Areas are designated on the "Site Plan" . . . .

Article IX of the Agreement governed maintenance and repair of the Shopping Center. With respect to the Common Area, the agreement provided in pertinent part in Section 4.2(A) as follows:

Subject to the joint maintenance provision set forth in (B) below, each Party shall maintain, or cause to be maintained, the Common Area on its Tract in a sightly, safe condition and good state of repair. . . . The maintenance and repair obligation shall include but not be limited to the following:

. . . .

(ii) Debris and Refuse. Peri odic removal of all papers, debris, filth, refuse, ice and snow (2" on surface), including vacuuming and broom sweeping to the extent necessary to keep the Common Area in a first-class, clean and orderly condition . . . . All sweeping shall be at appro priate intervals during such times as shall not interfere with the con duct of business or use of the Common Area by Permitees.

. . . .

(viii) Sidewalks. Maintain ing, cleaning and replacing of all sidewalks, including those adja cent and contiguous to Buildings located within the Shopping Cen ter. Sidewalks shall be steam cleaned periodically and shall be swept at appropriate intervals during such time as shall not interfere with the conduct of business or use of the Common Area.

. . . .

Notwithstanding anything to the contrary, each Party shall have [the] obligation to operate, maintain, and repair, in a clean, sigh[tly] and safe condition, the following items located on its Tract: exterior shipping/receiving dock area; any truck ramp or tr[uck] parking area; any recycling center or similarly designated area [for] the collection of items intended for recycling; and any refu[se] compactor or dumpster area.

(B) Commencing on the earlier of [Target's opening day or earlier day designated by the Approving Parties], the Operator shall operate and maintain the Common Area of the Shopping Center in accordance with the requirements of Section 4.2(A) above. . . .

The term "Operator" was also defined in Article I, 1.8, of the Agreement, which provided:

"Operator" shall mean the Person designated from time to time by the Approving Parties to maintain and operate the Common Area of the Shopping Center. The Person designated as an Operator shall serve in such capacity until he resigns or is removed by the Approving Parties. The Approving Parties hereby designate Developer as the initial Operator and Developer accepts such appointment.

Although at first blush this might suggest Arisa was responsible for the Common Areas on the Target Tract, the Agreement in Article IV, 4.2(G), contained a provision that, if exercised, would override Article IV, 4.2(B), as follows:

Target shall have the right, upon giving not less than sixty (60) days' written notice to Operator, to take over and assume the maintenance of the Common Area upon the Target Tract. Following the effective date of such assumption, Target shall maintain the Common Area on its Tract, and shall pay all costs and expenses incurred in connection therewith . . . .

The record is silent as to whether Target ever exercised that option. However, the fact that Target had assumed responsibility for steam cleaning the sidewalks on its Tract and picking up debris and refuse would reasonably support an inference that it exercised this option, at least with respect to sidewalks.

At the core of this dispute are the two indemnification provisions in the Agreement. Article V, 5.4(A), which was to apply "[d]uring the period the Operator is maintaining the Common Area," provided in pertinent part as follows:

Operator agrees to defend, protect, indemnify and hold harmless each Party from and against all claims or demands, including any action or proceeding brought thereon, and all costs, losses, expenses and liabilities of any kind, including reasonable attorneys' fees and cost of suit, asserted or incurred in connection with or arising out of the performance, or failure to perform, by Operator of its duties or obligations under this Agreement with respect to the maintenance and operation of the Common Area; provided however, the foregoing obligation shall not apply to claims caused by the sole negligence or by the willful act or omission of the Party to be indemnified. If any Party is operating and maintaining the Common Area on its Tract, such Party agrees to defend, protect, indemnify and hold harmless the other Parties in identical fashion to that required of Operator in the immediately preceding sentence.

On the other hand, Article V, 5.4(B), which apparently applied at all times, provided as follows:

Each Party agrees to defend, protect, indemnify and hold harmless each other Party from and against all claims or demands, including any action or proceedings brought thereon, and all costs, losses, expenses and liability of any kind relating thereto, including reasonable attorneys' fees and cost of suit arising out of or resulting from the injury to or death of any Person or damage to the property of any Person located on the tract owned by each indemnifying Party; provided however, the foregoing obligation shall not apply to claims caused by the negligence or willful act or omission of such other Party, its licensees, concessionaires, agents, servants, or employees, or the agents, servants, or employees of any licensee or concessionaire thereof.

On May 10, 2007, Arisa moved for judgment summarily dismissing plaintiffs' complaint against it, and on May 11, 2007, Target did so as well. Target also sought summary judgment against Arisa on Target's cross-claims against Arisa for contribution and indemnification, dismissing Arisa's similar cross-claims against Target. Target did not support this portion of its motion with any certifications from its employees, relying instead on the deposition testimony of Reddington, Sturdy, and Marambio none of whom testified with respect to the Agreement in question. Thereafter, Target realized that no cross-claims had been asserted in the answer filed on behalf of Target and Arisa, and so on May 22, 2007, Target filed a motion to amend its answer to formally assert such cross-claims. The judge granted the motion to amend on June 11, 2007, and extended discovery for sixty days from the date of the order. The motions for summary judgment were adjourned and scheduled for oral argument on August 31, 2007.

Arisa settled plaintiffs' claims on June 19, 2007, and plaintiffs signed a release as to all defendants in return for an $82,500 payment by Arisa. By letter dated June 15, 2007, Target confirmed the terms of the settlement and advised that the remaining cross-claims would be addressed by the pending motion, arbitration, or in some other manner to be determined. On June 29, 2007, Arisa substituted new counsel on its behalf. On July 16, 2007, plaintiffs filed a stipulation of dismissal with prejudice as to all parties. The stipulation explicitly excluded the cross-claims among the defendants.

At oral argument on the summary-judgment motions, the trial judge summarized the issue in contention:

What you have is whether or not this was a common area or not under the contract. It's clearly a common area. Once you make that decision and there's no genuine issue before a jury -- no jury could ever decide that this was not a common area, as far as I'm concerned.

. . . .

. . . It does not matter where [the packing strip] came from. It matters only that it was in the common area and that the accident occurred in the common area. And then the question becomes, well, who is responsible for this common area? That's really the issue before me.

The judge noted that the Agreement appointed Arisa as operator and that "Target didn't own this parking lot. They didn't own the sidewalks. It was owned by the partnership, and it was owned -- you know, everybody had access to it and, because of that, they named an operator to be responsible for it and they provided very clearly that the operator was responsible for it."

The judge also found the accident related to or arose out of the Common Area, which was the responsibility of Arisa:

And in the common areas, it becomes the responsibility of the operator and the developer was named as the operator, and [it] never resigned and was never replaced and, therefore, the developer, who is Arisa, is still the operator and it is the responsibility of the operator to maintain that property to make sure that no accidents occur and no claims arise out of the ownership and operation of the common areas. That's what this contract does.

The judge acknowledged that "it is possible that this piece of plastic came out of Target." However, "it [wa]s in the common area," and "[i]f it's in a common area, it's the responsibility -- clearly the responsibility of the operator." Therefore, the judge concluded that "the operator is responsible" and "will have to cover the costs of the settlement and the legal fees."

As for the issue of Target's potential negligence, the judge noted, "Target has a duty to their customers to maintain their property in a safe condition . . ." but "[t]he problem we have here is that this did not happen within the Target store." Rather, "[y]ou have a situation where the parties that built the center said, the outside area remains part of the partnership and it's going to be managed by and controlled by and maintained by the operator that we're going to name." Target was only responsible for its buildings; "[f]rom the wall in, [Target] was responsible."

By order dated August 31, 2007, the judge granted Target's motion for summary judgment as to Arisa, dismissed Arisa's cross-claims against Target with prejudice, and ordered Arisa to pay Target's counsel fees and costs in an amount to be determined. The court ordered that Target submit a fee certification within twenty days of the date of the order.

On September 18, 2007, Arisa filed a motion for reconsideration of this order. At oral argument on October 5, 2007, Arisa's counsel argued that "under Mantilla summary judgment [could not] be granted unless and until there has been an adjudication of liability because it is entirely plausible that if the facts of this case were to be heard by a jury, a jury could reasonably conclude that Target was the one negligent in this case." In that case, "under this agreement there would be no indemnity." The judge responded, "If I . . . adopt your thinking, counselor, the[n] no agreement ever for indemnifications is ever gonna be [sic] effective unless there is a trial by jury."

The judge stated that "there is absolutely not one iota of new law before me on this application," and "there's not one new fact before me on this application." The judge informed Arisa's counsel that he allowed counsel "to argue the matter out of courtesy more than anything else because I read the stuff last night again for the, I think the third or fourth time, and there's absolutely nothing new before me." He declared that "[t]his lady alleges she fell in the common areas, there is no doubt about that in my mind, [Arisa] accepted that because [it] settled with her, [it] paid her money."

In denying the motion for reconsideration, the judge determined that "[t]here's absolutely no reason for me to reconsider my decision" and concluded that "[t]here is no genuine issue of material fact as to who was the part[y] responsible here." He further noted, "That party has in fact admitted it because they settled the case with the plaintiff." The judge entered an order denying reconsideration the same day. Almost a year elapsed before the judge awarded Target attorneys fees and costs on September 14, 2008, in the amount of $77,258.85. This appeal followed.

Arisa contends the judge erred in concluding that (1) the accident occurred in a Common Area; (2) Arisa was the Operator at the time of the accident because it was the Operator identified in the Agreement in 1998; (3) Arisa was responsible for maintenance of the sidewalk in front of the Target store; and (4) Arisa's settlement with plaintiffs constituted an admission of liability by it. Specifically, Arisa contends that the Supreme Court in Mantilla held that an indemnitee was only entitled to the costs of defense if it was adjudicated free from active wrongdoing causing injury. It points out Target had an independent duty to its customers, only a jury could determine whether Target was free from fault, and numerous factual issues precluded summary judgment. In this respect, it contends Target did not establish, as an undisputed fact, the exact location of the accident, precluding a conclusion that it occurred in the Common Area, because it might have occurred within an "outward extension" of the Building or in an "Outside Sales Area." It further points out that even the Target employees who were deposed disagreed as to who was responsible for the sidewalk.

Arisa asserts Target submitted no evidence to establish the identity of the Operator on the day of the accident and even the definition of "Operator" states that it is the "person designated from time to time" to maintain and operate the Shopping Center. Further, Target had clearly assumed some of the responsibility for maintenance of the sidewalk in front of its store and a jury could easily conclude Target was negligent in this respect. Finally, it urges that a settlement of a claim is not admissible as evidence of liability, and the judge's conclusion to the contrary was clearly erroneous.

Target argues the terms of the agreement are clear, were correctly construed, and properly enforced by the judge. It urges that plaintiffs' assertion of a claim against it was all that was required to trigger the duty to defend and indemnify. Target claims Arisa failed to prove Target was at fault for the accident and the judge correctly concluded Target was not responsible for the area where plaintiff fell. It contends the trial court's "extraneous statements" during argument of the motion for reconsideration constitute harmless error because the language of the Agreement clearly obligated Arisa to defend and indemnify.

A trial court will grant summary judgment to the moving party "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c); Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995). The trial court must not decide issues of fact; it must only decide whether or not such issues exist. Brill, supra, 142 N.J. at 540; see also R. 4:46-5 (detailing affidavit requirements in a summary-judgment motion).

An issue is genuine "only if, considering the burden of persuasion at trial, the evidence submitted by the parties on the motion, together with all legitimate inferences therefrom favoring the non-moving party, would require submission of the issue to the trier of fact." R. 4:46-2(c) (emphasis added). If a "single, unavoidable resolution of the alleged disputed issue of fact" exists, that issue "should be considered insufficient to constitute a 'genuine' issue of material fact for purposes of Rule 4:46-2." Brill, supra, 142 N.J. at 540.

In order to prevail on a summary-judgment motion, we have long held the movant must establish a prima-facie right to a judgment. See, e.g., James Talcott, Inc. v. Shulman, 82 N.J. Super. 438, 443 (App. Div. 1964) (holding that "where the movant demonstrates" a prima facie case, "the opponent of the motion is required to show by competent evidential material that a genuine issue of material fact exists"); Amabile v. Lerner, 74 N.J. Super. 443, 447 (App. Div. 1962) (if movant establishes prima-facie right to summary judgment, opponent must utilize competent evidence to demonstrate the existence of a genuine issue of fact).

"If the movant is also the party bearing the burden of persuasion with regard to the claim, its initial summary[-]judgment burden is somewhat higher in that it must show that the record contains evidence satisfying the burden of persuasion and that the evidence is so powerful that no reasonable jury would be free to disbelieve it."

[CPC Int'l, Inc. v. Hartford Accident & Indem. Co., 316 N.J. Super. 351, 375 (App. Div. 1998) (quoting 6 James W. Moore, et al., Moore's Federal Practice 56.13(1) (3d ed. 1997)), certif. denied, 158 N.J. 73 (1999).]

See also Chase Manhattan Mtge. Corp. v. Spina, 325 N.J. Super. 42, 47 (Ch. Div.) (holding that movant must demonstrate "the existence of a prima facie case or defense"), aff'd, 325 N.J. Super. 1 (App. Div. 1999).

On appeal, "the propriety of the trial court's order is a legal, not a factual, question." Pressler, Current N.J. Court Rules, comment 3.2.1 on R. 2:10-2 (2009). An appellate court reviews the trial court's grant of summary judgment de novo, applying the same standard as the trial court. Turner v. Wong, 363 N.J. Super. 186, 198-199 (App. Div. 2003) (citing Antheunisse v. Tiffany & Co., 229 N.J. Super. 399, 402 (App. Div. 1988), certif. denied, 115 N.J. 59 (1989)). This court first decides whether a genuine issue of fact exists and, second, whether the trial court's ruling was correct. Antheunisse, supra, 229 N.J. Super. at 402.

Here, it was Target's burden to establish a prima-facie right to defense and indemnification under the Agreement and to meet its burden of persuasion on that issue. This required it to establish that plaintiff fell in the Common Area, rather than within a "Building" or an "Outside Sales Area" as those terms are defined by the Agreement. The judge's conclusion that "no jury could ever decide that this was not a common area" has no support in the record. Target submitted no proofs establishing this fact; rather, it merely established that plaintiff fell somewhere between fifteen and twenty-five feet from its "entrance." It did not submit the Site Plan to establish that the place where plaintiff fell was not an "Outside Sales Area." It did not submit any engineering drawings to establish that the place where plaintiff fell was not within its "appurtenant canopy" projecting out into the sidewalk and, thus, not within the definition of its "Building." The motion for summary judgment should have been denied in the absence of such proof.

With respect to the issue of where plaintiff fell, we also note that the judge's finding that Arisa owned the parking lot and sidewalks has no support in the record. The Agreement clearly indicates that Target's Tract includes its building, sidewalks, and parking lots. Additionally, the judge erred in finding that the parking lot and sidewalks were "owned by the partnership." There was no "partnership"; the Agreement specifically disclaimed any partnership or joint venture and nothing else in the record established anything to the contrary. Thus, summary judgment should not have been based on the findings that plaintiff fell on Arisa's property and that the parking lot and sidewalks were partnership property.

Although the judge was correct in observing that the Agreement designated Arisa as the Operator, Target was also required to establish that there had never been a modification to Article IX, 4.2(B), pursuant to the provisions of 4.2(G), assuming that plaintiff actually fell in the Common Area. That is, Target was required to establish that it never assumed responsibility for maintenance of all or a portion of the Common Area on its Tract. Target never submitted a certification to this effect from an employee with personal knowledge of the issue. Not only was there an absence of proof in this respect, the evidence submitted on the summary-judgment motion supported a reasonable inference that it had assumed maintenance of at least the sidewalk in front of its store. Target's employees testified that Target personnel steam cleaned the sidewalk twice a week and the cart attendants and other personnel observing debris were expected to pick it up and discard it. The Agreement in Article IX, 4.2(A)(ii), (viii), and 4.2(B) required the Operator to do this work, specifically mentioning steam cleaning and periodic removal of debris, unless Target assumed responsibility for doing so under 4.2(G). This inference should have been drawn in Arisa's favor and the motion for summary judgment denied.

Assuming plaintiff fell outside the Building envelope and outside any Outside Sales Area, the issue of which entity was responsible for maintenance of the sidewalk where plaintiff fell was pivotal to construing and applying the indemnification provisions. The duty of Arisa to indemnify and defend Target under Article V, 5.4(A), would arise only if Arisa was obligated to perform the duties imposed by Article IV, 4.2(A), with respect to the area where plaintiff fell. Otherwise, Target was obligated to defend and indemnify Arisa under Article V, 5.4(A). In either case, the duty to defend and indemnify would "not apply to claims caused by the sole negligence . . . of the Party to be indemnified." Thus, not only was Target required to establish that Arisa had a duty to defend and indemnify, it was also required to prove that Arisa was partially at fault for plaintiff's fall. It did not do so and Arisa should not have been required to defend and indemnify without such proof.

This brings us to the judge's finding that Arisa admitted liability for the accident by settling with plaintiffs. When a claim is disputed, settlement offers are not admissible to prove liability. N.J.R.E. 408. Settlement offers "do not imply a belief that an adversary's position is well-founded, but rather reflect 'a purchase of the offeror's peace.'" Brown v. Pica, 360 N.J. Super. 565, 570 (Law Div. 2001) (quoting Wyatt v. Wyatt, 217 N.J. Super. 580, 586 (App. Div. 1987)), appeal dismissed, 360 N.J. Super. 490 (App. Div. 2003). As such, offers of compromise are not factually relevant. Ibid. To the extent that this erroneous perception infused the judge's grant of summary judgment, it was not a proper basis for doing so. Unless no reasonable jury could find Arisa free from fault, the issue of its negligence must be determined by a jury. See Mantilla, supra, 167 N.J. at 273 (holding, in a converse situation, that an indemnitee is only entitled to recover counsel fees and costs for defense where it has been adjudicated free of fault).

After carefully reviewing the record in the light of the written and oral arguments advanced by the parties, we conclude that the remaining issues presented by Arisa and Target need not be decided at this time due to our conclusion that Target failed to meet its prima facie burden of persuasion.

 
Reversed and remanded for further proceedings consistent with this opinion.

All further references to "plaintiff" in the singular will signify plaintiff Cathy Marino.

Target has not pursued its claim against Arisa's insurance carrier, but instead sought contractual indemnification directly from Arisa.

Exhibit X is not included in the record on appeal.

Despite the passage of almost ten years from the execution of the Agreement to the time of plaintiff's trip and fall, no evidence was submitted to the court that Arisa remained the Operator pursuant to the terms of the Agreement.

There are also reciprocal insurance provisions that are not relevant to the issue before us.

Mantilla v. NC Mall Assocs., 167 N.J. 262, 269-70 (2001).

Of course, if there was no neglect under Article IV, 4.2(A), the owner of the Tract where an injury or death has occurred is obligated to defend and indemnify the other party, unless the injury or death was the result of the negligence or willful act or omission of the other party. Thus, Arisa's duty to indemnify Target, if it had such a duty as the Operator, is limited to a breach of the Operator's obligation to maintain and operate the Common Area.

(continued)

(continued)

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A-1142-08T3

August 13, 2009