United States District Court,S.D. Iowa,Central Division.

MIDAMERICAN ENERGY COMPANY, Plaintiff,

v.

START ENTERPRISES, INC. d/b/a American Moving Services, Inc., Defendant.

No. 4:06-cv-00220.

Feb. 14, 2008.

ORDER ON DEFENDANT’S MOTION FOR PARTIAL SUMMARY JUDGMENT

ROBERT W. PRATT, Chief Judge.

Before the Court is Defendant, Start Enterprises, Inc. d/b/a American Moving Services, Inc.’s (“Start”) Motion for Partial Summary Judgment, filed November 1, 2007. Clerk’s No. 21. Plaintiff, MidAmerican Energy Company (“MidAmerican”), filed a resistance on November 21, 2007. Clerk’s No. 24. Start filed a reply on November 29, 2007. Clerk’s No. 26. Start has requested oral argument on this matter, however, the Court finds that such argument would not materially aid the resolution of this case. Accordingly, the matter is fully submitted.

I. FACTS

For the most part, the parties do not dispute the facts of this case.MidAmerican is an Iowa corporation with its principal place of business in Des Moines, Iowa. Def.’s Statement of Material Facts ¶ 1. Start is engaged in the business of moving and storage services, with its principal place of business in Des Moines, Iowa. Id. ¶ 2. It appears that Start had some history performing moving and storage services for MidAmerican. Specifically, Start performed approximately 1,090 moves for MidAmerican between 1997 and 2005.Id. ¶ 27.In 2003, MidAmerican sent out a notice to prospective service providers entitled, “INSTRUCTION AND INFORMATION TO PROSPERS-Moving of Furniture and Equipment and Storage from September 15, 2003 to September 15, 2005.”Id. ¶ 4. In response to the notice, Start submitted its Schedule of Rates to MidAmerican, which also indicated that Start “provides liability coverage at a rate of $.60 per pound per item at no additional cost. Additional coverage may be purchased upon request.”Id. ¶¶ 6, 7. Based on Start’s schedule of rates, MidAmerican entered into a Professional Services Contract with Start, valid from September 15, 2003 through September 15, 2005. Def.’s App. at 13-20.

It appears that Start provided moving and storage services to MidAmerican without incident until June 27, 2005. On June 27, 2005, Start performed a move for MidAmerican. Pl.’s Statement of Additional Material Facts ¶ 1. The move required Start to transport MidAmerican’s computer equipment, an EMC Clariion CX700 storage array (“storage array”), from Bellevue, Nebraska to MidAmerican’s Sioux City, Iowa facility. Id. ¶¶ 1, 2. Based on the specification sheets for each individual component part contained in the storage array, it is estimated that the storage array weighs approximately 1,227 pounds.Def.’s Statement of Material Facts ¶ 33. This move was part of MidAmerican’s equipment relocation project. Pl.’s Statement of Additional Material Facts ¶ 3. On that day, while two Start employees were in the process of moving the storage array out of the building at Bellevue, they lost control of the storage array. See Pl.’s App. at 12. Specifically, Nick Bartlett (“Bartlett”), a crew leader, was handling the dolly with the storage array when he realized that the storage array was rolling off the dolly because the strap had come loose. Id. at 10, 12.Apparently, because the weight of the storage array was not evenly balanced on the dolly, the storage array started to tip to one side. Id. at 12.Bartlett explained that the storage array “twisted off the side of the dolly [and] rolled off the side of it.”Id. Although Bartlett tried to get a hold of the rolling storage array, he was unable to do so, and he fell to the floor with it. Id. Ultimately, the storage array fell on top of Bartlett’s legs. Id. Surprisingly, except for being “a little bit sore at that time,” Bartlett was not injured as a result of the incident. Id.

Later that day, Start employees delivered the storage array to MidAmerican’s Sioux City facility. Craig Vogel (“Vogel”), MidAmerican’s Supervisor of Data Center Processing met the two movers upon their arrival.Id. at 7; Def.’s App. at 47. The movers took the storage array upstairs to the data center. Pl.’s App. at 7. Vogel testified that during the thirty to forty minutes that the movers were with him, they did not inform him of the incident that occurred at Bellevue. Id. At some point during the delivery, one of the movers asked Vogel to sign the June 27, 2005 Bill of Lading (“Bill of Lading”). In the course of his employment with MidAmerican, Vogel has signed bill of lading forms and other similar documents to accept shipments on behalf of MidAmerican. Def.’s Statement of Material Facts ¶¶ 15, 19. In this instance, Vogel signed the Bill of Lading without reading it. Id. ¶ 16.Additionally, Vogel signed for both the point of origination (Bellevue) and the point of arrival (Sioux City).See id.Vogel testified that he signed for both locations because the mover told him to do so. Def.’s App. at 50.

The front page of the Bill of Lading provides:

CUSTOMER’S DECLARED VALUE AND LIMIT OF COMPANY’S LIABILITY

Since rates are based on the declared value of the property, and the customer (Shipper) is required to declare in writing the released value of the property, the agreed or declared value of the property is hereby specifically stated to be not exceeding .60 cents  per pound per article for transportation purposes.

Def.’s App. Ex. H. The reverse side of the Bill of Lading provides:Sec. 3. LIABILITY OF THE COMPANY:

…

(e) Unless a greater valuation is stated herein, the depositor or owner declares that the value in case of loss or damage arising out of storage, transportation, packing, unpacking … or handling of the goods and the liability of the company for any claim for which it may be liable for each or any piece or package and the contents thereof does not exceed, and is limited to, that amount per lb. designated on the front of this contract, or, if no amount is designated, to 60 cents per lb. per article for the entire contents of the storage lot, upon which declared or agreed value the rates are based, the depositor or owner having been given the opportunity to declare a higher valuation without limitation in case of loss or damage from any cause which would make the company liable and pay the higher rate based thereon, and in no event shall the company be liable except for its own negligence.

Def.’s App. 27.

Vogel received a carbon copy of the Bill of Lading after he signed it. Def.’s Statement of Material Facts ¶ 20. Approximately two to three hours after the movers left, Vogel received a telephone call from Robert Metcalf (“Metcalf”), MidAmerican’s Director, Technology Management. Def.’s App. at 49; Pl.’s App. at 1. At that time, Metcalf informed Vogel about the incident at the Bellevue location and instructed Vogel to isolate the storage array and not to power it until he received further instructions. Def.’s App. at 49. At some point, MidAmerican hired Pomeroy IT Solutions to test the storage array. See Pl.’s App. at 5. Upon testing, MidAmerican discovered variability in the test results and felt that it could not trust the storage array with its corporate data.Id. Moreover, EMC, the manufacturer of the storage array at issue, would no longer certify the storage array for warranty or maintenance purposes. Id. Based on the test results and warranty concerns, MidAmerican feared that the storage array was no longer reliable to maintain its corporate data. Id.; Def.’s Supp.App. at 3. Accordingly, MidAmerican initiated this lawsuit seeking to recover the damage caused to the storage array.

II. STANDARD FOR SUMMARY JUDGMENT

Summary judgment has a special place in civil litigation. The device “has proven its usefulness as a means of avoiding full-dress trials in unwinnable cases, thereby freeing courts to utilize scarce judicial resources in more beneficial ways.”Mesnick v. Gen. Elec. Co., 950 F.2d 816, 822 (1st Cir.1991). In operation, the role of summary judgment is to pierce the boilerplate of the pleadings and assay the parties’ proof in order to determine whether trial is actually required. See id.; see also Garside v. Osco Drug, Inc., 895 F.2d 46, 50 (1st Cir.1990).“[S]ummary judgment is an extreme remedy, and one which is not to be granted unless the movant has established his right to a judgment with such clarity as to leave no room for controversy….”Robert Johnson Grain Co. v. Chem. Interchange Co., 541 F.2d 207, 209 (8th Cir.1976) (citing Windsor v. Bethesda Gen. Hosp., 523 F.2d 891, 893 n. 5 (8th Cir.1975)). The purpose of the rule is not “ ‘to cut litigants off from their right of trial by jury if they really have issues to try,’ ”Poller v. Columbia Broad. Sys., Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) (quoting Sartor v. Ark. Natural Gas Corp., 321 U.S. 620, 627, 64 S.Ct. 724, 88 L.Ed. 967 (1944)), but to avoid “useless, expensive and time-consuming trials where there is actually no genuine, factual issue remaining to be tried.”Anderson v. Viking Pump Div., Houdaille Indus., Inc., 545 F.2d 1127, 1129 (8th Cir.1976) (citing Lyons v. Bd. of Educ., 523 F.2d 340, 347 (8th Cir.1975)).

The plain language of Federal Rule of Civil Procedure 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The precise standard for granting summary judgment is well-established and oft-repeated: summary judgment is properly granted when the record, viewed in the light most favorable to the nonmoving party and giving that party the benefit of all reasonable inferences, shows that there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. SeeFed.R.Civ.P. 56(c); Harlston v. McDonnell Douglas Corp., 37 F.3d 379, 382 (8th Cir.1994). The court does not weigh the evidence nor make credibility determinations, rather the court only determines whether there are any disputed issues and, if so, whether those issues are both genuine and material. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact based on the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, if any. See Celotex, 477 U.S. at 323, 106 S.Ct. 2548;Anderson, 477 U.S. at 248, 106 S.Ct. 2505.Once the moving party has carried its burden, the nonmoving party must go beyond the pleadings and, by affidavits or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial. SeeFed.R.Civ.P. 56(c), (e); Celotex Corp., 477 U.S. at 322-23, 106 S.Ct. 2548;Anderson, 477 U.S. at 257, 106 S.Ct. 2505.“[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.”Anderson, 477 U.S. at 247-48, 106 S.Ct. 2505 (emphasis in original). An issue is “genuine,” if the evidence is sufficient to persuade a reasonable jury to return a verdict for the nonmoving party. See id. at 248, 106 S.Ct. 2505.“As to materiality, the substantive law will identify which facts are material…. Factual disputes that are irrelevant or unnecessary will not be counted.”Id.

III. LAW AND ANALYSIS

The Carmack Amendment to the Interstate Commerce Act subjects motor carriers, like Start, to absolute liability for “actual loss or injury to property” when transporting cargo in interstate commerce. 49 U.S.C. § 14706(a)(1). The Carmack Amendment provides:

A carrier providing transportation or service … shall issue a receipt or bill of lading for property it receives for transportation under this part. That carrier … [is] liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property caused by [the carrier].

49 U.S.C. § 14706(a)(1). A carrier can, however, limit its liability. Specifically,[A] carrier providing transportation or service … may … establish rates for the transportation of property … under which the liability of the carrier for such property is limited to a value established by written or electronic declaration of the shipper or by written agreement between the carrier and shipper if that value would be reasonable under the circumstances surrounding the transportation.

49 U.S.C. § 14706(c)(1)(A).

Prior to the enactment of the Trucking Industry Regulatory Reform Act of 1994 (“TIRRA”), and the ICC Termination Act of 1995 (“ICCTA”), federal courts consistently held that to limit its liability under the Carmack Amendment, a carrier must: (1) maintain a tariff within the prescribed guidelines of the Interstate Commerce Commission; (2) obtain the shipper’s agreement as to [the shipper’s] choice of liability; (3) give the shipper a reasonable opportunity to choose between two or more levels of liability; and (4) issue a receipt or bill of lading prior to moving the shipment. Hughes v. United Van Lines, Inc., 829 F.2d 1407, 1415 (7th Cir.1987).See, e.g., Emerson Elec. Supply Co. v. Estes Express Lines Corp., 451 F.3d 179, 186 (3d Cir.2006) (cases cited therein). The TIRRA and the ICCTA, however, only altered the first prong of the Hughes test. See, e.g., Emerson Elec. Supply Co., 451 F.3d at 187 n. 6;Sassy Doll Creations, Inc. v. Watkins Motor Lines, Inc., 331 F.3d 834, 841-42 (11th Cir.2003). That is, the Surface Transportation Board (“STB”) replaced the ICC, and now tariffs need only be filed with the STB in certain circumstances for the transportation of property in non-contiguous trade and household goods. Emerson Elec. Supply Co., 451 F.3d at 187 n. 6. Thus, post-TIRRA and post-ICCTA, courts continue to adhere to the Hughes test to determine if a carrier has limited its liability. Moreover, in applying the Hughes test, the Court is mindful that “Congress expressed a public policy against limitation of liability by carriers … [and that] absolute prohibition … was softened ever so slightly … [to admit] a narrow exception [,]” and like any exception to public policy, “the one wrought by the Carmack Amendment must be construed narrowly.”Rohner Gehrig Co., Inc. v. Tri-State Motor Transit, 950 F.2d 1079, 1083 (5th Cir.1992).

*5Here, without conceding liability in the first instance, Start argues that it satisfied the Hughes test and properly limited its liability to $ .60 per pound pursuant to the Bill of Lading. The first prong is not contested, as MidAmerican admits that Start maintained a tariff with the Surface Transportation Board, the Iowa Department of Transportation, and the Household Goods Carrier Bureau. Def.’s Statement of Material Facts ¶ 3; Pl.’s Response to Def.’s Statement of Material Facts ¶ 3. MidAmerican, however, contends that Start did not meet its burden of proving that Start complied with the rest of the remaining requirements, i.e., obtaining MidAmerican’s agreement as to choice of liability; giving MidAmerican a reasonable opportunity to choose between two or more levels of liability; and issuing a receipt or bill of lading prior to moving the shipment. As the carrier seeking to limit its liability, Start has the burden of proving that it complied with each of the requirements. See, e.g., Carmana Designs Ltd. v. N. Am. Van Lines, Inc., 943 F.2d 316, 319 (3d Cir.1991).

A. Did Start Issue a Receipt or a Bill of Lading Prior to Moving the Storage Array?

As noted above, to limit liability under the Carmack Amendment, the fourth prong requires the carrier to prove that it issued a receipt or a bill of lading that reflects the agreement between the two parties to limit liability.Gallo v. Bekins A-1 Movers, Inc., No. 2:05-cv-00866, 2007 WL 817622, at(D.Nev. Mar. 14, 2007). The bill of lading, moreover, must be issued prior to shipment. See, e.g., Hughes, 829 F.2d at 1421 (stating that “carrier must… provide the shipper with a receipt or bill of lading before transporting his goods”) (emphasis added). Start points to the Bill of Lading signed at the point of origination and the point of destination to demonstrate that Start satisfied this prong. The inquiry here, however, is whether Start issued the Bill of Lading prior to shipment, not whether the Bill of Lading was ultimately signed for both locations after delivery. Indeed, Vogel’s undisputed testimony shows that he signed for both locations after the storage array was delivered to Sioux City. Def.’s App. at 50.

There is nothing in the record to demonstrate that Start issued the Bill of Lading prior to shipment, nor does Start claim that it issued the Bill of Lading prior to shipment. Rather, Start focuses on the fact that the Bill of Lading was signed for after delivery. That, however, does not satisfy Start’s burden of proving that it complied with the requirement that it issue a receipt or a bill of lading prior to shipment. Based on Bartlett’s deposition testimony, it appears that a MidAmerican agent was present at Bellevue for the pick-up of the storage array. See Pl.’s App. at 11. It is unclear from the record, however, whether this MidAmerican agent was provided with the Bill of Lading and failed to sign it, or whether Start failed to provide the Bill of Lading to MidAmerican’s agent altogether. Regardless, based on the record, Start did not prove that it complied with the requirement that the Bill of Lading be issued to MidAmerican prior to shipment. Accordingly, at this stage on summary judgment, the Court cannot conclude as a matter of law that Start satisfied the fourth prong of the test-that Start provided a receipt or the Bill of Lading prior to shipment.

B. Did Start Obtain MidAmerican’s Agreement as to MidAmerican’s Choice of Liability?

*6At this stage in summary judgment, in making all inferences in favor of MidAmerican, if Start failed to issue the Bill of Lading prior to shipment, such action, or rather inaction, would also affect the second prong of the Hughes test, whether Start obtained MidAmerican’s agreement as to MidAmerican’s choice of liability. As noted above, if the MidAmerican agent at the Bellevue location was not provided with the Bill of Lading to read, sign, or otherwise, it would be difficult for Start to argue that there was agreement to limit liability prior to shipment. A shipper can choose to limit a carrier’s liability without signing a bill of lading. Acro Automation Sys., Inc. v. Iscont Shipping Ltd., 706 F.Supp. 413, 417 (D.Md.1989). For instance, “[r]eceipt of the writing by the shipper and his action upon it are adequate proof that he has assented to its terms and has made it the written agreement of the shipper and carrier.”Id. (quoting Caten v. Salt City Movers & Storage Co., 149 F.2d 428, 432 (2d Cir.1945)). Thus, “when a writing that is the basis of the agreement limiting liability is assented to by conduct, the conduct, if unambiguous, will serve the same function a[s] a signature.”Id.

However, “an agreement limiting liability in the absence of a signature would require delivery of the written agreement before performance of the contract of carriage so that the shipper’s action on it in proceeding with the shipment reveals his assent to the terms of the agreement.”Id. (citing Am. Ry. Express Co. v. Lindenburg, 260 U.S. 584, 591, 43 S.Ct. 206, 67 L.Ed. 414 (1923)). In this case, there is no indication of assent by conduct prior to shipment. As for Vogel, he accepted the Bill of Lading after delivery, and after the storage array had been allegedly damaged. At that point, there was no action that could be taken upon the Bill of Lading because, by the time Vogel received the Bill of Lading, Start’s performance had been completed. Id. Vogel’s acceptance of the Bill of Lading upon delivery “only acknowledged receipt of delivery, not acceptance of the terms of the contract of carriage.”Id. Accordingly, based on the record before the Court, the Court cannot conclude as a matter of law that Start satisfied the second prong of the of the test-that Start obtained MidAmerican’s agreement as to MidAmerican’s choice of liability.

IV. CONCLUSION

For the reasons stated above, Start’s Motion for Partial Summary Judgment (Clerk’s No. 21) is DENIED.

IT IS SO ORDERED.

Unless otherwise noted, the facts stated herein are uncontested.

It appears that a storage array is a computer subsystem which houses a group of disks or tapes, together controlled by software usually housed within the subsystem.

The storage array, however, has not been weighed on a scale. Pl.’s Response to Def.’s Statement of Material Facts ¶ 33.

The .60 cents notation was already typed in by Start.

TIRRA eliminated the requirement that nonhousehold good carriers file a tariff containing rates with the Interstate Commerce Commission (“ICC”).Emerson Elec. Supply Co. v. Estes Express Lines Corp., 451 F.3d 179, 185 (3d Cir.2006).

ICCTA replaced former § 10730 with § 14706, and replaced the ICC with the Surface Transportation Board. Id. at 185-86.

Because MidAmerican’s main argument stems from Start’s alleged failure to issue a receipt or a bill of lading prior to shipment, the Court will address the fourth prong first.

Start also proffers the argument that during the course of years in which Start performed moves for MidAmerican, there were occasions where signatures were not immediately collected on the bill of lading forms. Such a contention is without merit. As noted above, the inquiry here is whether Start issued a receipt or a bill of lading prior to shipment, a requirement that Start must satisfy to limit its liability under the Carmack Amendment.

Because Start was not able, as a matter of law, to satisfy the fourth and the second prong of the Hughes test, the Court need not address the third prong, whether Start provided MidAmerican a reasonable opportunity to choose between two or more levels of liability.

Superior Court of New Jersey,Appellate Division.

Emily MARSHALL, an Infant, John Marshall, Individually and as Executor of the Estate of Greta Schmidt, and as Guardian Ad Litem for Emily Marshall, Plaintiffs,

v.

RARITAN VALLEY DISPOSAL, Edward Hawley, Defendants,

andTownship of West Amwell, Defendant/Third-Party Plaintiff/Respondent/Cross-Appellant,

v.

Illinois National Insurance Company, Third-Party Defendant/Appellant/Cross-Respondent.

Argued Oct. 23, 2007.

Decided Feb. 14, 2008.

The opinion of the court was delivered by

SKILLMAN, P.J.A.D.

The issue presented by this appeal is whether an insured that has had all costs of defense and settlement of a claim paid by one insurer may pursue a coverage action against a second insurer even though the first insurer would be subrogated to any recovery from the second insurer. We conclude that an insured lacks standing to maintain a coverage action under such circumstances and that the first insurer’s claim for contribution against the second insurer is the only coverage claim that survives the settlement. We also conclude that the first insurer must pursue this claim in its own name.

I

Defendant Raritan Valley Disposal (RVD) contracted with defendant West Amwell to furnish a garbage truck at the municipal transfer station for West Amwell’s residents to deposit their trash every Saturday. RVD was responsible for bringing the truck to the transfer station and parking it at a location designated by the West Amwell employee in charge of the site. RVD’s driver had no responsibility for assisting West Amwell’s residents in loading trash. Once the RVD garbage truck was filled or the transfer station was closed for the day, RVD was responsible for removing the truck and disposing of its contents.

The contract under which this service was performed obligated RVD to maintain insurance coverage and list West Amwell as an “additional named insured.” To satisfy this obligation, RVD named West Amwell as an additional insured under its business automobile policy, which had been issued by third-party defendant Illinois National Insurance Company (Illinois National).

On May 12, 2001, Greta Schmidt was fatally injured while unloading her trash at the West Amwell transfer station. The accident occurred when another West Amwell resident, defendant Edward Hawley, backed his pick-up truck into Schmidt, pinning her against the parked RVD garbage truck. Ms. Schmidt’s five-year-old daughter, Emily Marshall, observed the fatal accident from inside Schmidt’s car.

Following the accident, Schmidt’s estate brought this survivorship and wrongful death action against Hawley, West Amwell, RVD and the manufacturer of Hawley’s pick-up truck, Ford Motor Company. The complaint also asserted an emotional distress claim on behalf of Ms. Schmidt’s daughter.

At the time of the Schmidt accident, West Amwell was not only named as an additional insured under the policy Illinois National issued to RVD but also had its own general liability policy issued by the Public Alliance Insurance Coverage Fund (PAIC). West Amwell notified PAIC of the accident and subsequent lawsuit, and PAIC undertook West Amwell’s defense in accordance with its obligations under the policy.

After the lawsuit had been pending for several years, West Amwell filed a third-party complaint against Illinois National seeking coverage under the policy Illinois National had issued to RVD. Before there was a ruling on this third-party complaint, PAIC entered into a settlement of the Schmidt estate’s claim against West Amwell for $1,850,000. Hawley’s insurer settled the claims against him for $500,000, and Ford settled for $15,000. The case subsequently proceeded to trial solely against RVD, which resulted in a jury verdict in RVD’s favor.

Notwithstanding PAIC’s defense and settlement of the underlying action on its behalf, West Amwell continued to pursue its third-party coverage action against Illinois National. This claim was brought before the trial court on cross-motions for summary judgment. Illinois National argued that West Amwell lacked standing to pursue a coverage action for the defense costs and settlement PAIC had paid on its behalf. Illinois National also argued that the business automobile policy it had issued to RVD did not provide coverage to West Amwell for the Schmidt estate’s claim and that the $1,850,000 PAIC agreed to pay in settlement of that claim was unreasonable.

The trial court concluded that the Illinois National policy provided coverage to West Amwell for the Schmidt estate’s claim and that the amount PAIC paid to settle that claim was not unreasonable. However, the court did not address Illinois National’s argument that West Amwell lacked standing to pursue the coverage action. Based on these rulings, the court entered judgment in West Amwell’s favor against Illinois National for $1,000,000, which was the full amount of coverage provided under the Illinois National policy, plus the costs of defense of the Schmidt estate’s claim from the date of West Amwell’s demand for defense and prejudgment interest.

Illinois National filed a motion for reconsideration based partly on the trial court’s failure to address its argument that West Amwell lacked standing to pursue the coverage action because PAIC had paid all costs of the defense and settlement of the Schmidt estate’s claim and, as a result, West Amwell no longer had financial interest in the coverage action against Illinois National.

The court denied the motion by a lengthy written decision. In rejecting Illinois National’s standing argument, the court recognized that PAIC was the real party in interest in pursuing the coverage action against Illinois National because PAIC had been subrogated to West Amwell’s claim upon payment of the costs of West Amwell’s defense and settlement of the underlying action. However, the court concluded that this circumstance did not require the action to be pursued in PAIC’s name. The court stated that New Jersey’s substitution rule, Rule 4:34-3, was permissive only, and it concluded that West Amwell could “continue[ ] the action in its name although the matter is actually an insurance company pursuing rights of subrogation.”The trial court also denied a motion by West Amwell for an award of the counsel fees and costs it had incurred in pursuing the coverage action.

Illinois National appeals from the summary judgment in West Amwell’s favor on the coverage claim and the denial of its motion for reconsideration. Illinois National argues that: (1) West Amwell lacked standing to pursue a coverage claim against Illinois National because the full costs of its defense and settlement of the Schmidt estate claim had been paid by PAIC; (2) Illinois National’s policy did not provide coverage to West Amwell for the Schmidt estate’s claim; and (3) West Amwell failed to prove that the amount of its settlement with the estate was reasonable. West Amwell cross-appeals from the denial of its motion for an award of the counsel fees and costs it incurred in the coverage action against Illinois National.

We conclude that West Amwell lacked standing to pursue a coverage action against Illinois National once PAIC paid all costs of its defense and settlement of the Schmidt estate’s claim. Consequently, we reverse the judgment in West Amwell’s favor on the third-party complaint and remand the case to the trial court to allow PAIC to be substituted for West Amwell as the third-party plaintiff. This disposition makes it unnecessary to address Illinois National’s other arguments.

Because West Amwell lacked standing to pursue a coverage action against Illinois National, it is not entitled to an award of the counsel fees and costs it incurred in pursuing that action. Therefore, on West Amwell’s cross-appeal from the trial court’s denial of such an award, we affirm.

II

Rule 4:26-1 provides in pertinent part that “[e]very action may be prosecuted in the name of the real party in interest[.]” This rule is “ordinarily determinative of standing to prosecute an action.”Pressler, Current N.J. Court Rules, comment 2.1 on R . 4:26-1 (2008).

“[T]o have standing, a party must have ‘a sufficient stake and real adverseness with respect to the subject matter of the litigation[.]’ “ Town of Secaucus v. Hudson County Bd. of Taxation, 133 N.J. 482, 491-92 (1993) (quoting N.J. Chamber of Commerce v. N.J. Election Law Enforcement Comm’n, 82 N.J. 57, 67 (1980)). “A financial interest in the outcome of litigation is ordinarily sufficient to confer standing.” Assocs. Commercial Corp. v. Langston, 236 N.J.Super. 236, 242 (App.Div.), certif. denied,118 N.J. 225 (1989).

A party who claims to be an insured has a sufficient financial interest to seek a declaration of such coverage even though that party also has other insurance coverage and the other insurer has already undertaken its defense. This interest generally derives from the fact that the coverage provided under one policy may be insufficient to protect the insured from its full exposure to liability. See, e.g., Owens-Illinois, Inc. v. United Ins. Co., 138 N.J. 437 (1994).

West Amwell had such an interest in additional insurance coverage when it filed the third-party complaint against Illinois National because its policy with PAIC had a single occurrence policy limit of $5,000,000, and the Schmidt estate’s claims were sufficiently substantial that West Amwell was exposed to a verdict in excess of that limit. Therefore, West Amwell had the required standing to file the third-party complaint.

An insurer that has provided coverage to its insured also has a sufficient financial interest in obtaining a declaration that another insurer provided coverage for the same occurrence to have standing to pursue a coverage action against the other insurer for contribution to the costs of defense and indemnification of their common insured. See, e.g., Cosmopolitan Mut. Ins. Co. v. Cont’l Cas. Co., 28 N.J. 554 (1959); Jefferson Ins. Co. v. Health Care Ins. Exch., 247 N.J.Super. 241, 245-58 (App.Div.1991). Therefore, PAIC would have had standing to pursue a coverage action against Illinois National at any time after it received West Amwell’s request for a defense in the action brought by the Schmidt estate.

Although an insured and its insurer both have standing to pursue coverage actions against another insurer that has issued a policy that allegedly provides coverage for the same occurrence, this does not mean that their claims are identical. The insured’s claim is ordinarily governed solely by the terms of the alleged second insurer’s policy. On the other hand, the claim of the first insurer is governed not only by the terms of the second insurer’s policy but also by its own policy. See Cosmopolitan, supra, 28 N.J. at 558-63. Insurance policies generally contain provisions which indicate whether the coverage provided thereunder is primary, secondary or excess and the effect of “other insurance” upon the insurer’s obligations. See Lee R. Russ & Thomas F. Segalia, Couch on Insurance §§ 217.1 to 217.5 (3d ed.1999). Moreover, where multiple policies affording coverage for the same occurrence contain conflicting “other insurance” clauses, the trial court must resolve those conflicts in accordance with the principles set forth in Cosmopolitan, supra, 28 N.J. at 559-64. See also Hanco v. Sisoukraj, 364 N.J.Super. 41, 47-48 (App.Div.2003); Universal Underwriters Ins. Co. v. CNA Ins. Co., 308 N.J.Super. 415, 417-21 (App.Div.1998). If the policies are found to be co-primary, the insurers are required to apportion the costs of the settlement and defense equally. Cosmopolitan, supra, 28 N .J. at 564.

With this understanding of the differences between the claims that an insured and its insurer may maintain against an alleged other insurer, it is clear that West Amwell lost standing to pursue its coverage action against Illinois National once PAIC settled the Schmidt estate’s claim on its behalf. As a result of that settlement, PAIC paid all the costs of West Amwell’s defense and the full amount of its settlement with the estate. West Amwell was not entitled to double indemnification of those costs even if Illinois National’s policy also provided West Amwell with coverage for the estate’s claim. See Couch on Insurance, supra, § 217.1. Therefore, West Amwell no longer had the financial stake required to pursue a coverage action against Illinois National.

However, PAIC’s coverage claim against Illinois National, which it had failed to assert up to that point, survived the settlement because PAIC paid all the costs of defense and settlement of the Schmidt estate’s claim, to which Illinois National could be obligated to contribute if its policy also provided coverage for the accident. See Jefferson, supra, 247 N.J.Super. at 245-48. Moreover, PAIC was required to pursue this claim in its own name rather than in the name of West Amwell. See United States v. Aetna Cas. & Surety Co., 338 U.S. 366, 380-81, 70 S.Ct. 207, 215, 94 L. Ed. 171, 185 (1949) (holding that “[i]f the [insurer] has paid an entire loss suffered by the insured, it is the only real party in interest and must sue in its own name.”). This claim could have been asserted either by PAIC filing a separate action against Illinois National or, as discussed in section III of this opinion, by the substitution of PAIC for West Amwell under Rule 4:34-3.

We note that Illinois National also could have joined PAIC as a party to the action by filing a fourth-party complaint.

Instead of pursuing either of these courses of action, PAIC, which had full control over West Amwell’s defense and third-party complaint, continued to pursue the coverage claim against Illinois National solely in West Amwell’s name. PAIC’s theory was that, as a result of its settlement of the Schmidt estate’s claim on West Amwell’s behalf, it was entitled to pursue West Amwell’s coverage action against Illinois National as a subrogation action. Under this theory, there was no need to review the terms of PAIC’s policy or to compare the coverage and other insurance provisions of the PAIC and Illinois National policies. The trial court accepted this theory and entered judgment against Illinois National, nominally in favor of West Amwell but, as the parties recognized at oral argument before us, actually in favor of PAIC.

This ruling enabled PAIC to step into West Amwell’s shoes and obtain the full amount of coverage provided under the Illinois National policy without showing that that policy provided primary or co-primary coverage for the Schmidt estate’s claim. This ruling also enabled PAIC to obtain a greater contribution from Illinois National to the settlement of the Schmidt estate’s claim than it could have recovered if it had pursued the coverage claim in its own name; under Cosmopolitan, supra, 28 N.J. at 564, Illinois National would have been subject, in such an action, to liability for only half the $1,850,000 settlement amount, or $925,000, which is $75,000 less than the $1,000,000 the trial court awarded West Amwell acting on PAIC’s behalf. In short, the trial court not only allowed the coverage action against Illinois National to be brought in the name of West Amwell, which was not the real party in interest, but also ruled in West Amwell’s favor without requiring it to prove an essential element of the claim of the real party in interest, PAIC-that the Illinois National policy provided primary or co-primary coverage for the Schmidt estate’s claim-and awarded West Amwell more than PAIC would have been able to recover. Therefore, the judgment against Illinois National must be reversed.

III

The next question is whether West Amwell’s third-party complaint must be dismissed for lack of standing or whether PAIC may be substituted for West Amwell as a third-party plaintiff in accordance with Rule 4:34-3. This rule provides in pertinent part:

In any case of any transfer of interest, the action may be continued by or against the original party, unless the court on motion directs the person to whom the interest is transferred to be substituted in the action or joined with the original party.

There is no New Jersey case law interpreting Rule 4:34-3, or its predecessor, R.R. 4:38-3, and there is only limited federal case law interpreting its counterpart in the federal rules, F.R.C.P. 25(c), which until a recent amendment, effective December 1, 2007, was worded almost identically to Rule 4:34-3. One commentator has described F.R.C.P. 25(c) as “amongst the most obscure and least known of the eighty-nine substantive Federal Rules of Civil Procedure.”Shaun P. Martin, Substitution, 73 Tenn. L.Rev. 545, 545 (2006).

The federal cases indicate that substitution under F.R.C.P. 25(c) is permissive, and if the trial court does not order substitution, the action may be continued in the name of the original party in interest. See Luxliner P.L. Export Co. v. RDI/Luxliner, Inc., 13 F.3d 69, 71 (3d Cir.1993). There are also federal cases which state that F.R.C.P. 25(c)“is not designed to create new relationships between the parties to a suit but is designed to allow the action to continue unabated when an interest in the lawsuit changes hands.”In re Covington Grain Co ., 638 F.2d 1362, 1364 (5th Cir.1981).

This view of the federal counterpart to Rule 4:34-3 could support the conclusion that substitution of PAIC for West Amwell as third-party plaintiff is not authorized by Rule 4:34-3 because of the previously discussed differences between West Amwell’s and PAIC’s coverage claims against Illinois National. However, both the trial court and the parties have already invested substantial time and resources in adjudicating those claims. Moreover, both West Amwell’s and PAIC’s claims derive from the same coverage provisions of the Illinois National policy and, like its federal counterpart and the predecessor New Jersey court rule, Rule 4:34-3 vests substantial discretion in the court to determine whether substitution would be appropriate under the circumstances of a particular case. See Morris M. Schnitzer & Julius Wilstein, New Jersey Rules Service: 1954 to 1967, comment 7 on R.R. 4:38-3. Therefore, we conclude that the interests of efficient judicial administration would be served by allowing PAIC to substitute for West Amwell as the third-party plaintiff rather than requiring PAIC to file a separate action against Illinois National.

Accordingly, we remand the case to the trial court to enable PAIC to substitute for West Amwell as third-party plaintiff. If PAIC elects not to pursue the coverage claim against Illinois National in its own name, West Amwell’s third-party complaint should be dismissed for lack of standing.

IV

Finally, we consider it unnecessary to address Illinois National’s arguments that its policy did not provide coverage to West Amwell for the Schmidt estate’s claim and that the amount of the settlement of that claim was unreasonable. Because PAIC is not a named party to this appeal, it is unclear whether any conclusion we might reach regarding those issues would be binding upon PAIC. Moreover, if PAIC declines to pursue the third-party complaint in its own name or if the trial court concludes that the policy Illinois National issued to RVD did not provide West Amwell with primary or co-primary coverage for the Schmidt estate’s claim, it would be unnecessary to decide those issues.

Accordingly, the judgment in West Amwell’s favor on the third-party complaint is reversed, and the case is remanded to the trial court for further proceedings in conformity with this opinion. The order denying West Amwell’s motion for an award of its counsel fees and costs in the coverage action is affirmed.