“Any Auto” Does Not Extend Commercial Auto Coverage to Unrelated Third-Party Vehicles Merely Present on Insured Property

1. Introduction

This insurance-coverage dispute concerns whether a commercial automobile policy covering “any auto” requires an insurer to defend premises-negligence lawsuits arising from accidents involving unrelated third-party vehicles. The Third Circuit held that the phrase could not reasonably be read in isolation to extend coverage to vehicles having no relevant connection to the insureds’ ownership, operations, or business purposes.

C.J. Hesse, Inc. (“Hesse”) and Atlantic Pier Co., Inc. (“Atlantic Pier”) held a joint commercial automobile policy issued by American Family Home Insurance Company (“AFHIC”). Atlantic Pier leased land in Manchester Township, New Jersey, to Ocean County Landfill Co., Inc., which operated a landfill there. Hesse was a general contractor controlled by members of the same family that controlled Atlantic Pier, and the companies shared a business address. Neither insured operated the landfill, and the record disclosed no connection between Hesse and the landfill.

Four garbage-truck accidents at the landfill generated six state-court lawsuits alleging bodily injury or property damage caused by the insureds’ negligent maintenance of the premises. Hesse was named in three of those suits. AFHIC declined to defend, prompting the insureds to sue for breach of the duty to defend.

The central issue was not whether garbage trucks qualified as “autos”—AFHIC accepted that they did—but whether these particular trucks were covered autos when the policy was read as a whole.

2. Summary of the Opinion

After removal to federal court, the District Court granted summary judgment to AFHIC and denied the insureds’ competing motion. The Third Circuit affirmed.

The policy required AFHIC to defend suits involving bodily injury or property damage “caused by an ‘accident’” and “resulting from the ownership, maintenance or use of a covered ‘auto.’” The applicable covered-auto designation was symbol 1: “Any ‘Auto.’” The insureds therefore argued that accidents involving the garbage trucks necessarily fell within the liability coverage.

The court rejected that unrestricted reading. Other policy provisions addressed vehicles the insureds owned, acquired, leased, hired, rented, borrowed, or used in connection with their businesses. Read together, these provisions indicated coverage for vehicles owned or operated by the insureds, or otherwise used to further their purposes—not a vehicle driven by a third party for a third party’s business merely because it happened to be on an insured’s property.

The court also held that, even assuming ambiguity, the insureds’ proposed expectation of coverage was not reasonable. Accordingly, they failed to establish an essential element of their duty-to-defend claim.

3. Legal Reasoning

A. The duty to defend depends on the policy’s coverage grant

Under the New Jersey law applied by the court, the insured bears the burden of establishing a duty to defend. Courts compare the underlying complaint with the insurance policy and ask whether the insurer would have to pay the resulting judgment if the allegations were sustained. Doubts are resolved in the insured’s favor.

That protective approach does not dispense with the requirement that the alleged liability potentially fall within the policy. Here, the presence of vehicles in the underlying accidents did not itself establish automobile coverage. The vehicles also had to qualify as “covered” autos under the particular contract.

The distinction is important because an accident can involve a motor vehicle while the alleged wrongdoing concerns maintenance of land. The court did not announce that premises-negligence allegations can never implicate automobile insurance. Its narrower conclusion was that these lawsuits involved third-party trucks outside the policy’s reasonably understood covered-auto scope.

B. “Any auto” was interpreted within the entire policy

The insureds’ argument relied on the breadth of the word “any.” Their reading would make the identity of the vehicle’s owner, operator, and business purpose immaterial once an accident involved an automobile.

The court instead examined the surrounding policy structure:

• The covered-auto designation table included categories of owned, hired, and non-owned vehicles.
• Those categories described relationships such as ownership, leasing, hiring, renting, borrowing, and use in connection with the insureds’ businesses.
• The policy also addressed coverage for qualifying vehicles acquired after the policy period began.

For the court, these provisions supplied the commercial context in which “any auto” operated. The phrase broadened the relevant vehicle category; it did not eliminate every relationship between the vehicle and the insured’s activities.

This was a contextual construction, not the application of an express exclusion quoted in the opinion. Nor did the court limit coverage to vehicles owned by the insureds. Its reasoning expressly accommodated vehicles operated by them or otherwise used to further their purposes.

C. The alleged vehicle connection was insufficient

The court characterized the garbage trucks as third-party vehicles driven by third parties for third-party business purposes. Their presence at the landfill did not, without more, make them covered vehicles under the insureds’ commercial automobile policy.

Atlantic Pier’s ownership-related interest in the premises was therefore insufficient. Hesse’s position was more remote: the record disclosed no connection between it and the landfill, notwithstanding the companies’ shared address and related family control. The court did not treat those corporate connections as establishing the necessary vehicle relationship.

D. Any ambiguity did not make the asserted expectation reasonable

New Jersey law generally construes ambiguous insurance language against the insurer and in favor of the insured’s reasonable expectations. The panel nevertheless concluded that the insureds’ interpretation could not reflect a reasonable expectation of coverage.

The opinion’s formulation—“Even if the term were ambiguous”—matters. The result did not depend solely on a categorical finding that “any auto” was unambiguous. The court supplied an alternative rationale: even assuming ambiguity, the proposed interpretation extended the commercial automobile policy beyond a reasonable understanding of its function and terms.

According to the panel, the insureds’ reading would effectively cover any automobile accident on their property even if they neither owned, controlled, maintained, nor operated the vehicle. Persuasive decisions from other jurisdictions reinforced the conclusion that such a construction was unreasonable.

E. The asserted inability to obtain premises coverage did not expand the auto policy

The insureds also argued that New Jersey law prevented them from obtaining premises-liability insurance because they lacked a permit to dispose of solid waste. They maintained that this circumstance made it reasonable to expect automobile coverage to fill the resulting gap.

The court rejected that reasoning. Even considering the asserted statutory framework, it was not reasonable to infer that the parties intended to introduce otherwise unavailable premises coverage through the phrase “any auto.”

The opinion does not identify or comprehensively interpret the relevant statutes. It therefore should not be read as independently establishing that the insureds were legally ineligible for premises insurance. Its holding addresses the inference they sought to draw from that asserted restriction.

4. Precedents Cited and Their Influence

A. Summary-judgment authorities

Turco v. City of Englewood, 935 F.3d 155, 161 (3d Cir. 2019)

This decision supplied the appellate standard of review. The panel reviewed summary judgment de novo, applying the same standard as the District Court and viewing the evidence favorably to the nonmoving party. Thus, the affirmance rested on the panel’s own assessment of the governing law and record rather than deference to the District Court’s interpretation.

Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)

Celotex established the consequence of failing to make a sufficient showing on an essential element for which a party bears the trial burden. It linked the procedural framework to the substantive insurance question: because the insureds bore the burden of establishing a duty to defend, their inability to show that the trucks fell within the policy supported judgment for AFHIC.

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)

Anderson supplied the definition of a genuine factual dispute: one permitting a reasonable jury to return a verdict for the nonmoving party. The panel concluded that no reasonable jury could regard the insureds’ expansive construction as reflecting a reasonable coverage expectation. The possibility of competing verbal interpretations did not, by itself, require a trial.

B. New Jersey duty-to-defend and policy-interpretation authorities

Kent Motor Cars, Inc. v. Reynolds & Reynolds, Co., 25 A.3d 1027, 1042 (N.J. 2011)

The court cited this decision for the insured’s burden to establish the insurer’s duty to defend. That allocation was decisive because the insureds needed to establish coverage under the affirmative coverage grant, not merely point to the involvement of a vehicle.

Norman Int'l, Inc. v. Admiral Ins. Co., 279 A.3d 425, 432 (N.J. 2022)

This case supplied the complaint-to-policy comparison: would sustaining the allegations require the insurer to pay the judgment? It also required doubts to be resolved in the insured’s favor. The panel applied that insured-protective framework but found that it did not overcome the limits of the covered-auto provision.

Abouzaid v. Mansard Gardens Assocs., LLC, 23 A.3d 338, 346 (N.J. 2011)

The opinion invoked Abouzaid through the quotation in Norman Int'l, Inc. v. Admiral Ins. Co.. Its role was to reinforce the established duty-to-defend inquiry and the resolution of doubts in favor of coverage, rather than to provide an independent interpretation of “any auto.”

Wilson v. USI Ins. Serv. LLC, 57 F.4th 131, 140–41 (3d Cir. 2023)

Wilson provided the central interpretive method: read the policy as a whole, give its terms their plain and ordinary meaning, and enforce clear language as written. It justified examining “any auto” alongside the designation table and acquisition provisions rather than treating those two words as a self-contained coverage promise.

Flomerfelt v. Cardiello, 997 A.2d 991, 996 (N.J. 2010)

Flomerfelt supplied the rule construing ambiguous policy language against the insurer to protect the insured’s reasonable expectations. The panel emphasized the qualification “reasonable.” It used that qualification to reject the insureds’ proposed reading even on the assumption that the disputed wording was ambiguous.

C. Persuasive decisions addressing broad automobile language

The panel stated that no New Jersey court had interpreted similar “any auto” language in a commercial automobile policy. It therefore looked to decisions from other jurisdictions as persuasive, not controlling, authority.

Bamber v. Lumbermens Mut. Cas. Co., 680 A.2d 901, 903 (Pa. Super. Ct. 1996)

The panel cited this Pennsylvania decision as rejecting the insureds’ sweeping interpretation of nearly identical wording. Its significance was comparative: it supported the conclusion that “any auto” need not encompass every unrelated vehicle involved in an accident at insured premises.

Cont'l Ins. Co. v. Ins. Co. of N. Am., 608 So.2d 1108, 1109 (La. Ct. App. 1992)

This Louisiana decision served the same corroborative purpose. Together with Bamber v. Lumbermens Mut. Cas. Co., it demonstrated that other courts had rejected similarly unrestricted readings of materially comparable policy language.

Liberty Mut. Ins. Co. v. Mid-Continent Ins. Co., 266 F. Supp. 2d 533, 545 (N.D. Tex. 2003), rev’d on other grounds, 508 F.3d 261 (5th Cir. 2007)

This decision provided the most explicit persuasive reasoning. The panel quoted its conclusion that neither insurer nor insured could reasonably have intended coverage for any automobile accident occurring near the insured’s operations. That reasoning supported the rejection of a location-based reading untethered to vehicle ownership, control, maintenance, or operation.

The subsequent reversal was expressly identified as being on other grounds. The opinion therefore relied on the district court’s reasoning with that procedural qualification, not as an unqualified appellate holding.

D. The decision under review

C.J. Hesse, Inc. v. Am. Fam. Home Ins. Co., No. CV 25-1101 (RK) (JBD), 2025 WL 2731349, at *9 (D.N.J. Sept. 25, 2025), was the District Court ruling being reviewed, rather than an independent binding precedent. The Third Circuit affirmed its disposition granting AFHIC summary judgment and denying the insureds’ motion.

5. Impact and Limits

Practical implications

• Broad wording remains contextual. A designation covering “any auto” does not necessarily insure every automobile-related occurrence at an insured location.
• The vehicle’s business relationship matters. Ownership is not indispensable, but operation, borrowing, hiring, or another connection to the insured’s purposes may distinguish future disputes.
• Property ownership alone is insufficient. The decision is particularly relevant to landlords facing claims involving vehicles used in a tenant’s independent operations.
• A coverage gap does not rewrite another policy. Difficulty obtaining premises insurance does not itself expand a commercial automobile coverage grant.
• Defense disputes may be resolved on summary judgment. An asserted ambiguity does not necessarily create a triable issue when the proposed expectation is unreasonable under the policy as a whole.

Limits of the decision

The opinion does not establish a universal rule excluding non-owned vehicles: its reasoning expressly recognizes coverage relationships beyond ownership. Nor does it resolve every accident involving a tenant’s vehicle or every overlap between premises liability and automobile insurance. Different policy language or evidence connecting a vehicle to the insured’s business could produce a different result.

The appeal also did not determine whether the insureds negligently maintained the landfill or were liable to the underlying plaintiffs. It resolved AFHIC’s defense obligation on the presented record, not the merits of those tort claims or a separate indemnification dispute.

Finally, because the disposition is nonprecedential, future courts may consider its reasoning but are not bound by it under the Third Circuit’s stated rule.

6. Complex Concepts Simplified

Duty to defend

The insurer’s obligation to provide a legal defense when the allegations potentially fall within the policy. It is distinct from deciding who ultimately owes damages.

Covered auto versus auto

A vehicle may plainly be an automobile without being an automobile insured under a particular policy.

Whole-policy interpretation

Reading a disputed phrase together with the rest of the contract, rather than giving isolated words their broadest conceivable meaning.

Reasonable expectations

Objectively reasonable understandings of coverage, not every coverage benefit an insured hoped to obtain.

Summary judgment

A decision without trial when no genuine dispute about a material fact prevents judgment under the governing law.

De novo review

Fresh appellate review without deference to the lower court’s legal conclusions.

Nonprecedential opinion

A decision resolving the parties’ appeal without establishing a binding rule for later cases under the court’s applicable practice.

7. Conclusion

The Third Circuit affirmed that AFHIC had no duty to defend the six underlying lawsuits. Read in context, “any auto” did not extend the insureds’ commercial automobile coverage to unrelated third-party trucks merely because accidents occurred on leased property.

The opinion’s principal contribution is its insistence that expansive vehicle designations remain anchored to the policy’s structure and objectively reasonable coverage expectations. Its persuasive significance is substantial, but its holding remains fact-specific and expressly nonprecedential.