In what we expect will be a periodic and continuing fea-ture in our newsletter, we address again the tendency of the New Jersey Courts on coverage issues. The latest decision reflecting this philosophy is found in The Profor¬mance Insurance Company v. Stacey Jones, et al., decided on December 22, 2005.
The facts of the case are simple. Charmaine Panichi owned a truck insured by Proformance. She loaned the truck to Henry Ward and she instructed him not to use the truck in his furniture moving business. Ward ignored her instruction and authorized his employee, Rosario, to use the truck to deliver furniture. As luck would have it, an accident occurred causing injury to a passenger and a pedestrian. Proformance denied coverage resulting in this declaratory action which ended up before the Supreme Court.
The issues raised in this case were (1) whether the initial permission rule would extend coverage to the ultimate driver when explicit instructions limiting the use of the vehicle were disregarded, and (2) whether the “business pursuits” exclusion in the policy would preclude coverage.
While it took 22 pages for the Court to decide these two issues, it made short work of the initial permission issue by re-affirming that anything short of the equivalent of theft grants complete permission which is transferable by the initial permittee to a subsequent permittee.
Only two questions need to be analyzed to determine this issue, namely: (1) Was there initial permission to use the vehicle, and (2) Did the subsequent use constitute “theft or the like”. As expected, there was initial permis¬sion and the subsequent use was not the equivalent of theft.orderly processing of insurance claims. However, by this decision the Court has determined that it is the legislative intent to allow a driver to drive in and out of different levels of coverage depending on the intent of the trip. Of course, it remains to be seen how an excess carrier will deal with this sce¬nario on a more significant injury case.

For a complete copy of the decision, contact the under-signed.

Kenneth R. Rothschild, Esq.