Appellate Division Affirms Dismissal of Coverage Claims, Citing Intentional Injury Exclusion and Supreme Court’s Rodriguez Decision

Michael Bunting injured his foot while working for Emil A. Schroth, Inc. He was paid workers’ compensation benefits by Schroth’s carrier, New Jersey Manufacturers Insurance Company. Bunting filed a personal injury lawsuit against Schroth, alleging gross negligence and intentional wrongdoing. Bunting and Schroth entered into a consent judgment for $1.25 million, and Schroth assigned its rights to Bunting to pursue insurance coverage from NJM, Great Northern Insurance Company and Chubb Insurance Company of New Jersey. These insurers denied defense and indemnity coverage for this accident. Bunting amended his complaint to name the insurers as defendants in agreeing not to enforce against Schroth. He sought a declaratory judgment that liability coverage must be provided.

The insurers filed separate Rule 4:6-2(e) motions to dismiss the complaint with prejudice for failure to state a claim, arguing the policy exclusions’ lack of coverage for intentional bodily injury applied. Bunting opposed and cross-moved for partial summary judgment. In the meantime, Bunting passed away, resulting in his daughter substituting in as Administratrix. The motion judge issued an order granting the motions to dismiss and denying Bunting’s cross-motion for summary judgment. He rejected Bunting’s contention that the exclusion violated public policy and that the plain language excluded all intentional wrongs.

Bunting appealed, but oral arguments were delayed until the Supreme Court’s decision in Rodriguez v. Shelbourne Spring, LLC, 259 N.J. 385 (2024). The policy in Rodriguez contained the same exclusions in question here, and the court considered whether an insurer had an obligation to defend its insured against a personal injury lawsuit that alleges negligence and intentional wrongdoing. 

After supplemental briefs were submitted, the Appellate Division affirmed the order dismissing Bunting’s claims for coverage from the insurers. They relied on Rodriguez to confirm that the insurers are not obligated to provide defense nor indemnity coverage due to the exclusion due to Bunting’s allegation that Schroth’s intentional wrongdoing caused his injury. 

_{What’s Hot in Workers’ Comp, Vol. 29, No. 7, July 2025, is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2025 Marshall Dennehey, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact tamontemuro@mdwcg.com.}