A town’s insurance company can seek indemnification from a contractor over damage to its municipal building, even after the contractor’s insurer obtained a court order rescinding its policy, the New Jersey Superior Court Appellate Division has ruled.
Travelers Property Casualty Co. of America, the insurance company for the town of Cliffside Park, had an independent right to seek relief against the construction company’s insurer, no matter what occurred in litigation between the construction company and its insurer, the appeals court said Dec. 29 in Everest Indemnity Insurance v. Tim Tiger Enterprises. Everest claimed the judgment against its insured, Tim Tiger Enterprises, represented an adjudication of all issues in the case, but Judges Clarkson Fisher Jr., George Leone and Francis Vernoia said “Nothing could be more absurd.”
The case stems from the October 2012 collapse of a water tower perched atop the Cliffside Park Municipal Building, which caused $2 million in property damage. Travelers, which insured Cliffside Park, paid for much of the damage. A few months earlier, Tim Tiger Enterprises (TTE) was contracted to replace an old tower on top of the building. After the tower collapsed, TTE gave notice of claim to its insurer, Everest Indemnity Insurance Co.
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