New Jersey Appellate Court Affirms Trial Court Ruling That A Tenant’s Insurer Has No Duty to Provide Coverage to a Landlord’s Real Estate Manager As An Additional Insured

In Diaz v. Chrys S. Norwood Family, LP, the New Jersey Appellate Division affirmed the trial court’s grant of summary judgment to an insurer in a personal injury suit that included a declaratory judgment cross-claim by one of the defendants for insurance coverage. In this case, the Plaintiff was an employee of a tenant who was injured when he slipped on ice and brought suit against the landlord, the landlord’s property manager, and another third party. The property manager sought defense and indemnification from the tenant’s insurer as an additional insured on the basis that the tenant’s policy included coverage for any person acting as the tenant’s real estate manager. The Appellate Division examined the policy language and determined that it only provided additional insured coverage to the insured’s real estate manager. As the manager worked for the landlord and not the tenant and could not demonstrate that it acted in that capacity for the tenant, the court held that no coverage was owed under the tenant’s policy.

In reaching this decision, the court relied upon previous holdings in Cambria v. Two JFK Blvd., LLC, 423 N.J.Super. 499 (App. Div. 2012) and First National Bank of Palmerton v. Motor Club of America Insurance Co., 310 N.J. Super. 1 (App. Div. 1997). The court noted that under these cases, the key question was whether the property manager could demonstrate that he was not just the landlord’s real estate manager, but that he was also the tenant’s real estate manager. In order to do that, the court held that the manager had to address whether the slip and fall occurred in the leased premises or some other area of the property for which the tenant was responsible. Applying those rulings in the instant case, the court determined that the slip and fall occurred on the walkway, which was part of the leased premises, and that the tenant was responsible under the lease for clearing snow and ice. Finding that the manager never performed any snow or ice removal on the tenant’s behalf, the court held that the manager could not qualify as the tenant’s real estate manager.

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