Case Briefs

In Jacques v. National Continental Ins. Co. 835 A.2d 309 (N. J. App. Div. Decided Nov. 26, 2003) the New Jersey Supreme Court held that an insurance carrier has no obligation to defend or indemnify a person who was given permission to enter but not to drive its insured's automobile. In this case, the insured drove her car to the home of her boyfriend's sister. When the insured reached that destination she locked the car after parking it on the street in front of the residence. Once inside the house, she gave her car keys to her boyfriend's nephew to retrieve a pack of cigarettes that she kept in the vehicle. Without the insured's knowledge, the nephew then drove the car and was involved in an accident. The court framed the issue as whether, under those circumstances, a reasonable fact-finder could conclude that the nephew was the car's “permissive user” for purposes of coverage under the insured's liability policy. The court held that the answer to that question is no.

The court noted that the “initial permission rule” contemplates a situation in “which the subsequent use of a car may be inconsistent with and even frustrate the intentions and plans of the person granting permission. The breadth of the rule is designed to assure that all persons wrongfully injured have financially responsible persons to look to for damages because a liability insurance contract is for the benefit of the public as well as for the benefit of the named or additional insured.” The court further stated that the initial permission rule is not concerned with the scope of use for which permission is granted. “[A]s long as the initial use of the vehicle is with the consent, express or implied, of the insured, any subsequent changes in the character or scope of the use, such as from a passenger to a driver, do not require the additional specific consent of the insured.”