Court Opinion

ID: 9550451
Source: CourtListenerOpinion
Date Created: 2023-08-07 18:35:20.916496+00
Date Added: 2024-06-11T15:21:33.399860
License: Public Domain

RABINOWITZ, Chief Justice,
dissenting.
Although I find the question in this case to be a close one, I have concluded that I cannot agree with the court’s opinion. In reaching this conclusion, I am persuaded by the reasoning of Weedo v. Stone-E-Brick, Inc., 155 N.J.Super. 474, 382 A.2d 1152 (1977), reversed, 81 N.J. 233, 405 A.2d 788 (1979).1
In Weedo, in the course of construing insurance policy language identical to that
*5at issue in the present case, the court stated:
[The insurance company’s] concept of the exception to exclusion (a) is that it applies only where the alleged defective workmanship causes property damage not excluded under some other provision of the policy. Thus, it recognizes coverage under the policy for a property damage claim arising out of a breach of the warranty referred to in the exception. It contends, however, that a breach of warranty claim otherwise within the exception is clearly excluded by exclusion (o). We cannot accept that contention, for to do so would produce the anomalous situation of a provision in the policy which takes away coverage expressly granted in another provision. We do not deem it necessary to construe exclusion (o) in its relation to exclusion (a), as did the court in Federal Ins. Co. v. P.A.T. Homes, [113 Ariz. 136, 547 P.2d 1050 (1976)]. In our view, the coexistence of the two provisions creates, at the very least, an ambiguity which must be resolved in favor of the insured so as to provide coverage. To paraphrase that which we said in Elcar Mobile Homes, Inc. v. D. K. Baxter, Inc., 66 N.J.Super. 478, 485, 169 A.2d 509, 512 (App.Div.1961), if the insurer here deemed it necessary to make plain beyond dispute that claims for breach of the warranty contained in the exception to exclusion (a) were to be excluded, ‘it is a mystery to us why the insurer did not say so in simple language. It is not a concept difficult to express.’
Id. 382 A.2d at 1158-59 (citation omitted).
Exclusions (j), (1) and (m) of the U.S. Fire Insurance policy and exclusions (1), (n) and (o) of the Industrial policy appear to retract coverage which is previously recognized in exclusion (a) of both policies. Under our rules of construction for insurance policies,2 a policy should not be able to provide for coverage in one paragraph which it takes away in another without at least a clear expression of the intended limitation. I do not think that a layperson, reading the insurance policies in this case, “reasonably” would have understood that because (a) is an exclusion it “merely removes the breach of implied warranty of fitness, quality, or workmanship from the specific exclusion relating to contractual liability” but “remains subject to and limited by all other related exclusions.”3 I would thus hold that the repugnancy among the policy provisions should be construed in favor of the insured to provide the coverage a layperson would expect.

. I wish to note my agreement with the views expressed by Justice Pashman in his dissent to the supreme court’s reversal of the lower court.
Of five cases from other jurisdictions which address issues nearly identical to the one raised in this appeal, the following rule in favor of the insured: Federal Ins. Co. v. P.A.T. Homes, Inc., 113 Ariz. 136, 547 P.2d 1050 (1976); Fontainebleau Hotel Corp. v. United Filigree Corp., 298 So.2d 455 (Fla.App.), cert, denied, 303 So.2d 334 (Fla.1974); Applegren v. Milbank Mut. Ins. Co., 268 N.W.2d 114 (N.D.1978). The following cases rule against the insured: St. Paul Fire and Marine Ins. Co. v. Coss, 80 Cal.App.3d 888, 145 Cal.Rptr. 836 (1978); Haugan v. Home Indem. Co., 86 S.D. 406, 197 N.W.2d 18 (1972).

. Haugan v. Home Indem. Co., 86 S.D. 406, 197 N.W.2d 18, 22 (1972).