MUN JAE KIM v. LEADING INSURANCE GROUPAnnotate this Case
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R.1:36-3.
SUPERIOR COURT OF NEW JERSEY
DOCKET NO. A-0
MUN JAE KIM,
LEADING INSURANCE GROUP AND
LEADING INSURANCE SERVICES,
December 7, 2016
Submitted October 25, 2016 Decided
Before Judges Reisner and Sumners.
On appeal from Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. L-7111-14.
Kimm Law Firm, attorneys for appellant (Michael S. Kimm and Adam Garcia, on the briefs).
Havkins Rosenfeld Ritzert & Varriale, LLP, attorneys for respondent (Brian A. Bosner, on the brief).
Plaintiff Mun Jae Kim appeals from the Law Division's June 11, 2015 orders denying his motion to strike the answer of defendants Leading Insurance Group and Leading Insurance Services (collectively Leading) for failure to provide discovery, and granting Leading's summary judgment motion dismissing his complaint. For the reasons that follow, we affirm.
On June 3, 2011, Nilda L. Glikin sustained injuries due to a fall that occurred at a grocery store owned by Mun and Mi Yang Kim.1 In accordance with the store's commercial liability insurance policy with Leading, Mun submitted a notice of claim to Leading describing the incident. Leading acknowledged receipt of the claim on August 17.
Almost two years later in April 2013, Glikin filed a personal injury complaint against Mun and Mi Yang.2 Despite being served the complaint, neither of them advised Leading of the lawsuit as required by the insurance policy. Section IV Commercial General Liability Conditions of the policy provides
2. Duties In The Event of Occurrence Offense, Claim or Suit
. . . .
b. If a claim is made or "suit" is brought against any insured, you must
(1) Immediately record the specifics of the claim or "suit" and the date received; and
(2) Notify [Leading] as soon as practicable.
You must see to it that we receive written notice of the claim or "suit" as soon as practicable.
c. You any other involved insured must
(1) Immediately send [Leading] copies of any demands, notices, summonses or legal papers received in connection with the claim or "suit";
In early December 2013, default was entered against Mun and Mi Yang for failing to file an answer to the complaint. However, Leading was not notified of the default as required under the policy. Instead, Mun retained the Kimm Law Firm to represent him and Mi Yang without notice to or approval by Leading. According to the insurance policy's requirements in Section IV, paragraph (d): "No insured will, except at the insured's own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for first aid, without [Leading's] consent."
The Kimm Law Firm submitted a consent order to the trial court vacating the default and extending the time for Mun and Mi Yang to answer the complaint. The order was entered on December 9, 2013. Several weeks later, the Kimm Law Firm wrote a letter to Leading regarding Mun's intention to sue for "bad faith denial of insurance coverage, indemnity, and benefits under [the] [p]olicy[.]" Leading did not respond to the letter. Nonetheless, Leading subsequently entered into a stipulation with Glikin's counsel to extend the time to answer the complaint to April 11, 2014. Unbeknownst to Leading, on March 3, the Kimm Law Firm had filed an answer to the complaint on Mun's and Mi Yang's behalf.
On May 19, after receiving Glikin's medical records and obtaining a second extension of time to file an answer, Leading settled Glikin's lawsuit for $14,500. Upon becoming aware of the settlement, Mun's counsel sent a letter to Leading alleging that Leading did not defend Mun and Mi Yang and demanded reimbursement of $14,000 in legal fees that Mun incurred in retaining the Kimm Law Firm to provide a defense. When Leading refused to pay the legal fees, Mun filed the within action seeking reimbursement of his fees contending that Leading breached its contractual duty to defend and the covenant of good faith and fair dealing by using Mun's retained counsel to gain leverage to settle Glikin's action.
Prior to the conclusion of discovery, Mun filed a motion to strike Leading's answer due to failure to provide discovery. Leading cross-moved for summary judgment to dismiss the complaint.
On June 11, 2015, following argument, the motion judge issued an oral decision granting summary judgment to Leading and denying Mun's discovery motion as moot. The judge found that Leading was not obligated to reimburse Mun's legal fees as Leading never denied insurance coverage and did not act in bad faith in handling Glikin's claim. The judge reasoned that had Mun notified Leading about Glikin's lawsuit, "he never would have been in default, and wouldn t have to [hire the Kimm Law Firm]." She also noted that Leading did not approve Mun's retention of counsel, and an insured cannot select his own attorney. Further, the judge found that when Leading first received notice of Glikin's action on January 23, 2014, it promptly contacted Glikin's counsel to get an extension to file an answer, and then settled the matter. After granting summary judgment, the judge concluded that Mun's discovery motion was moot. Separate orders were entered that same day memorializing the decision, and this appeal followed.
Appellate review of a ruling on a motion for summary judgment is de novo, applying the same standard governing the trial court. Davis v. Brickman Landscaping, Ltd., 219 N.J. 395, 405 (2014). Thus, we consider, as the motion judge did, "whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Id.at 406 (quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J.520, 540, (1995)). "If there is no genuine issue of material fact," an appellate court must then "decide whether the trial court correctly interpreted the law." DepoLink Court Reporting & Litig. Support Servs. v. Rochman, 430 N.J. Super. 325, 333 (App. Div. 2013) (citation omitted). We accord no deference to the trial judge's legal conclusions. Nicholas v. Mynster, 213 N.J. 463, 478 (2013) (citing Zabilowicz v. Kelsey, 200 N.J. 507, 512-13 (2009)). We review the judge's ruling on the discovery motion for abuse of discretion. State v. Enright, 416 N.J. Super. 391, 404 (App. Div. 2010), certif. denied, 205 N.J. 183 (2011).
With these principles in mind, we conclude that there is no reason to disturb the motion judge's grant of summary judgment dismissing Mun's complaint and denial of his motion to strike Leading's answer for failure to provide discovery. We therefore affirm substantially for the reasons expressed by the judge in her oral decision. We add the following limited comments.
After properly notifying Leading of Glikin's claim shortly after her fall, Mun breached his duty to notify Leading of the subsequent lawsuit and default as required by the clear terms of the insurance policy. Absent that notification, Leading was unaware of the need to defend Mun. Once Leading became aware of the lawsuit and the default against its insureds, Leading took prompt action to vacate the default and settled the matter. Further, we discern no reason for Mun to hire his own counsel as Leading never denied coverage. Mun failed to obtain permission from Leading, as required under the policy, before retaining counsel to vacate the default against him and Mi Yang. Accordingly, Mun is not entitled to be reimbursed fees paid to the Kimm Firm.
As for the denial of Mun's discovery motion, there was no showing by Mun that any further discovery would have changed the outcome of the summary judgment motion. Thus, the motion was properly denied as moot.
1 For clarity, and intending no disrespect, we refer to the Kims by their first names.
2 The action filed in the Law Division, Passaic Vicinage, Docket No. PAS-L-1333-13, also named Popular Supermarket, John Doe, 1-10, and ABC Corp. 1-10 as defendants.