                                                     SYLLABUS

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the
convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the
interest of brevity, portions of any opinion may not have been summarized.)

                         Occhifinto v. Olivo Construction Company (A-77-13) (073174)

Argued January 21, 2015 -- Decided May 7, 2015

SOLOMON, J., writing for a unanimous Court.

           In this appeal, the Court considers whether a party who prevailed against its carrier in a declaratory
judgment action seeking coverage and defense of the underlying liability action against it, but did not prevail in the
liability action, is a “prevailing party” entitled to recover counsel fees under Rule 4:42-9(a)(6).

           Plaintiff Robert Occhifinto (Occhifinto) filed suit against defendant Robert S. Keppler Mason Contractors,
LLC (Keppler) and others seeking damages for alleged defective construction of an addition to his warehouse (the
liability action). In the liability action, Keppler was defended by its insurance carrier, Mercer Mutual Insurance
Company (Mercer), under a reservation-of-rights agreement. Before trial in the liability action, Mercer filed an
action for a declaratory judgment challenging its obligation to provide coverage and to defend Keppler in the
liability action. Occhifinto, on Keppler’s behalf, contested the claims raised by Mercer, and filed counterclaims
asserting that Mercer had a duty to defend and indemnify Keppler under the policy, and that Mercer was obligated
for the counsel fees incurred in defending the declaratory judgment action.

         In the declaratory judgment action, the parties filed cross-motions for summary judgment on the insurance
coverage question. The trial court held that Mercer was required to indemnify Keppler for damages covered by the
insurance policy. The court therefore denied Mercer’s motion for summary judgment and granted partial summary
judgment to Occhifinto, reserving the claim for counsel fees until conclusion of the liability action.

         The liability action proceeded, and Occhifinto did not prevail. After trial, Occhifinto sought to recover
counsel fees from Mercer pursuant to Rule 4:42-9(a)(6), which authorizes an award of counsel fees in “an action
upon a liability or indemnity policy of insurance in favor of a successful claimant.” The trial court denied
Occhifinto’s motion, holding that he was not a successful claimant in the liability action because he was not entitled
to indemnity coverage in the liability action. In an unpublished opinion, the Appellate Division affirmed that
determination.

         The Court granted the petition for certification filed by Occhifinto limited to the issue of Occhifinto’s right
to counsel fees under Rule 4:42-9(a)(6). 217 N.J. 291 (2014).


HELD: Occhifinto was a successful claimant entitled to counsel fees under Rule 4:42-9(a)(6). In the declaratory
judgment action, the trial court properly concluded that Mercer would be required to indemnify Keppler in the event
Keppler was found liable, and therefore determined that the liability action alleged claims that, if proven, would fall
within the coverage of Keppler’s liability policy with Mercer. That determination had the practical effect of
enforcing Mercer’s duty to defend. By forcing Mercer to defend the liability action, Occhifinto obtained a favorable
adjudication on the merits on a coverage question as the result of the expenditure of counsel fees, rendering
Occhifinto a successful claimant under Rule 4:42-9(a)(6).

1. Notwithstanding the strong public policy in New Jersey against shifting of costs, counsel fees may be awarded in
certain circumstances, including those described in Rule 4:42-9(a)(6), authorizing fee shifting in “an action upon a
liability or indemnity policy of insurance, in favor of a successful claimant.” This provision discourages insurance
companies from attempting to avoid their contractual obligations and thereby forcing their insureds to expend
counsel fees to obtain coverage that they are entitled to receive. (pp. 7-8).
2. The term “successful claimant” is broadly defined as a party that succeeds on any significant issue in litigation
which achieves some benefit the parties sought in bringing suit. A party who obtains a favorable adjudication on the
merits on a coverage question as the result of the expenditure of counsel fees is a successful claimant under Rule
4:42-9(a)(6). A successful claimant under Rule 4:42-9(a)(6) may include a party in a negligence action who, like
plaintiff, is a third-party beneficiary of a liability insurance policy and litigates a coverage question against a
defendant’s insurance carrier. (pp. 9-10).

3. Having determined that a successful claimant under Rule 4:42-9(a)(6) is one who obtains a favorable
adjudication on the merits on a coverage question as the result of the expenditure of counsel fees, the Court next
considers whether the duty to defend is a coverage question. The duty to defend is a “coverage question” if the
complaint alleges claims that would, if proven, fall within the coverage of the policy. As the Court explained in
Schmidt v. Smith, 294 N.J. Super. 569, 591 (App. Div. 1996), aff’d 155 N.J. 44 (1998), a party who confirms an
insurance carrier’s duty to defend qualifies as a successful claimant even if there is no award of damages in the
liability action such as would trigger the carrier’s duty to indemnify. (pp. 10-13).

4. Although an award of counsel fees under Rule 4:42-9(a)(6) involves the exercise of sound discretion by the trial
court, the ruling by the trial court in this matter was based upon a mistaken interpretation of the meaning of
“successful claimant” under Rule 4:42-9(a)(6) rather than an exercise of discretion. As an interpretation of the law,
the trial court’s judgment is not entitled to deference. (p. 13).

5. In the declaratory action brought by Mercer seeking to disclaim coverage, the trial court granted Occhifinto’s
motion for summary judgment, holding that Mercer would be required to indemnify Keppler in the event Keppler
was found liable. Although not expressly referencing Mercer’s duty to defend Keppler, the trial court properly
concluded that the complaint in the liability action alleged claims that, if proven, would fall within the coverage of
the policy. The trial court’s determination that Mercer may have a duty to indemnify Keppler had the practical effect
of enforcing Mercer’s duty to defend. Consequently, Occhifinto succeeded in the declaratory judgment action by
forcing Mercer to continue to defend Keppler in the liability action. Based thereon, Occhifinto obtained a favorable
adjudication on the merits on a coverage question as the result of the expenditure of counsel fees, and was therefore
a successful claimant under Rule 4:42-9(a)(6). (pp. 14-16).


         The judgment of the Appellate Division is REVERSED and the matter is REMANDED to the trial court
for determination of the amount of counsel fees which Occhifinto is entitled to recover as a successful claimant
under Rule 4:42-9(a)(6) consistent with this opinion.

       CHIEF JUSTICE RABNER; JUSTICES LaVECCHIA, ALBIN, PATTERSON, and FERNANDEZ-
VINA; and JUDGE CUFF (temporarily assigned) join in JUSTICE SOLOMON’s opinion.




                                                          2
                                     SUPREME COURT OF NEW JERSEY
                                       A-77 September Term 2013
                                                073174

ROBERT OCCHIFINTO and NVE,
INC.,

    Plaintiffs-Appellants,

         v.

OLIVO CONSTRUCTION CO., LLC,
MARTIN OLIVO, HOUGHTON,
QUARTY & WARR, LLC, WW
CONSTRUCTION AND MASONRY STAR
BUILDING SYSTEMS, ANDRES F.
ANDERSEN ASSOCIATES, INC.,
DIAMOND SAND AND GRAVEL CO.,
INC., ANTUL N. SHAH, P.E.,
ANS CONSULTANTS, INC., and
BARDO COX & MILLER, INC.,

    Defendants,

         and

ROBERT S. KEPPLER MASON
CONTRACTORS, LLC, a/k/a
ROBERT S. KEPPLER CONCRETE
CONSTRUCTION, LLC, and MERCER
MUTUAL INSURANCE CO.,

    Defendants-Respondents.


         Argued January 21, 2015 – Decided May 7, 2015

         On certification to the Superior Court,
         Appellate Division.

         Dennis T. Smith argued the cause for
         appellants (Pashman Stein, attorneys).

         Michael L. Testa, Sr., argued the cause for
         respondent Mercer Mutual Insurance Company


                                1
          of New Jersey (Testa Heck Scrocca & Testa,
          attorneys; Justin R. White, on the brief).

          Gregory J. Irwin submitted a brief on behalf
          of respondent Robert S. Keppler Mason
          Contractors, LLC a/k/a Robert S. Keppler
          Concrete Construction, LLC (Harwood Lloyd,
          attorneys).


     JUSTICE SOLOMON delivered the opinion of the Court.

     Plaintiff Robert Occhifinto (Occhifinto) brought an action

for damages against defendant Robert S. Keppler Mason

Contractors, LLC (Keppler), and other entities responsible for

the construction of an addition to his manufacturing warehouse

(liability action).   Occhifinto alleged that defendants’

negligence caused the addition’s concrete floor to fracture and

fail.   In the liability action, Keppler was defended by its

insurance carrier, Mercer Mutual Insurance Company (Mercer),

under a reservation-of-rights agreement.    Before trial in the

liability action, Mercer filed a complaint challenging its

obligation to provide coverage and to defend Keppler, which

Occhifinto opposed on Keppler’s behalf.    The trial court found

that Mercer was required to indemnify Keppler for damages

assessed that were covered by the insurance policy.

     The liability action proceeded to trial, and the jury found

that Keppler breached its duty of care but did not proximately

cause the failure of the warehouse floor and, therefore, awarded

no damages against Keppler.   After trial, Occhifinto moved to

                                 2
collect counsel fees from Mercer pursuant to Rule 4:42-9(a)(6),

which authorizes trial courts to award counsel fees in “an

action upon a liability or indemnity policy of insurance in

favor of a successful claimant.”       The trial court denied

Occhifinto’s motion, holding that he was not a successful

claimant because Keppler was not found liable for damages in the

liability action.

    We conclude that plaintiff was “a successful claimant”

entitled to counsel fees under Rule 4:42-9(a)(6), and therefore

reverse the judgment of the Appellate Division.

                                I.

    The following facts are undisputed for the purpose of this

appeal.   Occhifinto sought to expand the nutritional supplement

factory he owned and operated by constructing more manufacturing

and storage space.   He hired Olivo Construction Co., LLC (Olivo)

as the general contractor for the expansion.       Olivo hired

Keppler as the masonry subcontractor.      Keppler’s primary

responsibility under the subcontract was to pour the

manufacturing building’s second-story concrete floor.       Several

months after completion of the expansion, the second-story floor

began to fracture, rendering the building unsafe for occupancy.

Subsequently, Occhifinto filed a complaint alleging negligence,




                                   3
among other things, against Keppler and the other entities

involved with the construction.1

     Keppler held a general liability insurance policy issued by

Mercer, which covered property damage to third parties resulting

from an “occurrence” or accident.      The policy excluded from

coverage damages resulting from “a failure to perform an

agreement or contract in accordance with its terms”; and

“property damage caused, to any extent, by [Keppler’s] products

or [Keppler’s] work or any part of such.”      Mercer initially

agreed to provide Keppler with a legal defense but reserved the

right to disclaim coverage.

     In an effort to disclaim coverage Mercer filed a

declaratory judgment action before the liability action

commenced.   Mercer asserted that it had no duty to defend or

indemnify Keppler against Occhifinto’s claims because the

alleged damages fell outside of the policy’s coverage.

Occhifinto defended the declaratory judgment action on behalf of

Keppler and filed a counterclaim asserting that (1) Mercer had a

duty to defend and indemnify Keppler under the policy, and that

(2) Mercer was required to pay the counsel fees incurred

defending the declaratory judgment action.




1 Occhifinto’s complaint also alleged breach of contract, breach
of warranties, and other related claims which are not relevant
to this decision.
                                   4
    The parties filed cross motions for summary judgment on the

insurance coverage question.    Mercer also requested an

adjournment of the liability action pending resolution of the

declaratory judgment action on coverage.     The trial court denied

Mercer’s summary judgment motion and partially granted

Occhifinto’s, reserving the claim for counsel fees until the

conclusion of the liability action.    In his decision the trial

judge stated, “I am satisfied that with regard to the proofs

that have been presented on this application, that there is

coverage under the policy.”    The judge then determined “that

there is a duty to provide indemnification in the event that

there is a finding of liability at trial.”    Finally, the judge

denied Mercer’s request for an adjournment, and consolidated

Occhifinto’s claim for counsel fees in the declaratory judgment

action with the liability action.

    At the conclusion of the liability trial, the jury found

Keppler not liable, determining Keppler had breached its duty of

care to Occhifinto but the breach was not a proximate cause of

Occhifinto’s damages.   Thereafter, Occhifinto moved pursuant to

Rule 4:42-9(a)(6) to recover counsel fees incurred defending

Keppler in Mercer’s declaratory judgment action.    The court

denied the motion because the jury found Keppler was not liable.

The court reasoned that Occhifinto was not a “successful



                                  5
claimant” because success under the rule “is contingent upon the

securing of indemnity coverage.”

    The Appellate Division affirmed in an unpublished opinion.

We granted certification limited to the issue of Occhifinto’s

right to counsel fees under Rule 4:42-9(a)(6).   Occhifinto v.

Olivo Constr. Co., LLC, 217 N.J. 291 (2014).

                               II.

    Occhifinto contends he is a “successful claimant” under

Rule 4:42-9(a)(6) because the trial court required Mercer to

defend and, if necessary, indemnify Keppler.   In addition, he

argues that no deference is owed to the trial court’s decision

because it was predicated upon a misconception of controlling

legal principles, not upon an exercise of its discretion.

    Mercer counters that to be a “successful claimant” under

Rule 4:42-9(a)(6), Occhifinto was required to prevail in the

liability action.   Thus, Mercer maintains that the trial court

applied the correct legal standard governing the award of

counsel fees under Rule 4:42-9(a)(6).   Mercer also asserts that

it provided a defense to Keppler under a reservation of rights

agreement; thus, the only issue decided by the declaratory

judgment action was whether Mercer was contractually obligated

to indemnify Keppler against the types of claims alleged in

Occhifinto’s complaint.   Accordingly, Mercer claims the duty to



                                   6
defend was never at issue, and Occhifinto must show he succeeded

in securing indemnity coverage to be a “successful claimant.”

                                 III.

                                  A.

    Resolution of the present issue requires an understanding

of New Jersey’s policy regarding fee shifting, which is the

award of counsel fees to a successful party.    New Jersey courts

“have traditionally adhered to the American Rule as the

principle that governs the allocation of attorneys’ fees.”

Walker v. Giuffre, 209 N.J. 124, 127 (2012).    The American Rule

“‘prohibits recovery of counsel fees by the prevailing party

against the losing party.’”     In re Estate of Vayda, 184 N.J.

115, 120 (2005) (quoting In re Niles Trust, 176 N.J. 282, 294

(2003)).   Thus, litigants typically bear the cost of their own

legal representation.   Ibid.   “The purposes behind the American

Rule are threefold: (1) unrestricted access to the courts for

all persons; (2) ensuring equity by not penalizing persons for

exercising their right to litigate a dispute, even if they lose;

and (3) administrative convenience.”     Niles Trust, supra, 176

N.J. at 294.

    Notwithstanding New Jersey’s “‘strong public policy against

the shifting of costs,’” counsel fees may be awarded in certain




                                  7
circumstances.2   Litton Indus., Inc. v. IMO Indus., Inc., 200

N.J. 372, 404-05 (2009) (quoting Vayda, supra, 184 N.J. at 120).

A goal of fee shifting is to discourage parties from using the

costs of litigation to gain an advantage over their opponent.

See Niles Trust, supra, 176 N.J. at 299-300; In re Estate of

Lash, 169 N.J. 20, 26 (2001).     Here, Occhifinto’s fee-shifting

claim is based on Rule 4:42-9(a), which authorizes fee shifting

in eight specific circumstances,3 including “an action upon a

liability or indemnity policy of insurance in favor of a


2 The award of counsel fees to the successful litigant is allowed
by statute, court rule, contract terms, and equitable
principles. With some variance, this approach is adopted by most
jurisdictions. See generally John F. Vargo, The American Rule
on Attorney Fee Allocation: The Injured Person’s Access to
Justice, 42 Am. L. Rev. 1567, 1578-88 (1993); see also Trope v.
Katz, 902 P.2d 259, 262-63 (Cal. 1995); Schoonmaker v. Lawrence
Brunoli, Inc., 828 A.2d 64, 94 (Conn. 2003); Goodrich v. E.F.
Hutton Grp., 681 A.2d 1039, 1043-44 (Del. 1996); Preferred Mut.
Ins. Co. v. Gamache, 686 N.E.2d 989, 991 (Mass. 1997); Baker v.
Health Mgmt. Sys., 772 N.E.2d 1099, 1104 (N.Y. 2002); State ex
rel. Doe v. Smith, 914 N.E.2d 159, 165, reconsideration denied,
914 N.E.2d 1256 (Ohio 2009); McMullen v. Kutz, 985 A.2d 769, 775
(Pa. 2009).
3   The eight circumstances are
            family actions when permitted under Rule 5:3-
            5(c); out of a fund in court; in certain
            probate actions; in mortgage foreclosure
            actions; in tax certificate foreclosure
            actions; in actions upon a liability or
            indemnity insurance policy; as otherwise
            expressly allowed by the Rules of Court; and
            in all cases where statutorily allowed.
            [Litton, supra, 200 N.J. at 405 (citing R.
            4:42-9(a)(1) to (8).]

                                  8
successful claimant.”   R. 4:42-9(a)(6).    Fee shifting under Rule

4:42-9(a)(6) discourages insurance companies from attempting to

avoid their contractual obligations and force their insureds to

expend counsel fees to establish the coverage for which they

have already contracted.   Sears Mortg. Corp. v. Rose, 134 N.J.

326, 356 (1993); Guarantee Ins. Co. v. Saltman, 217 N.J. Super.

604, 610 (App. Div.), certif. denied, 109 N.J. 484 (1987);

Kistler v. N.J. Mfrs. Ins. Co., 172 N.J. Super. 324, 329-30

(App. Div. 1980).

    The term successful claimant is broadly defined as a party

that “‘succeed[s] on any significant issue in litigation which

achieves some benefit the parties sought in bringing suit.’”

R.M. v. Supreme Court of New Jersey, 190 N.J. 1, 10 (2007)

(quoting Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct.

1933, 1939, 76 L. Ed. 40, 50 (1983)).      A party who “obtain[s] a

favorable adjudication on the merits on a coverage question as

the result of the expenditure of [counsel] fees,” is a

successful claimant under Rule 4:42-9(a)(6).     Transamerica Ins.

Co. v. Nat’l Roofing Inc., 108 N.J. 59, 63 (1987).

    A successful claimant under Rule 4:42-9(a)(6) may include a

party in a negligence action who, like plaintiff, is a third-

party beneficiary of a liability insurance policy and litigates

a coverage question against a defendant’s insurance carrier.

See Sears, supra, 134 N.J. at 355; Myron Corp. v. Atl. Mut. Ins.

                                9
Corp., 407 N.J. Super. 302, 311 (App. Div. 2009), aff’d o.b.,

203 N.J. 537 (2010).   We authorize trial courts to award counsel

fees in favor of third-party beneficiaries of insurance

contracts because “an insurer’s refusal to provide liability

coverage may also, as a practical matter, preclude an innocent

injured party from being able to recover for the injury.”     Id.

at 311.

                                B.

    Having determined that a successful claimant under Rule

4:42-9(a)(6) is one who “obtain[s] a favorable adjudication on

the merits on a coverage question as the result of the

expenditure of [counsel] fees,” Transamerica, supra, 108 N.J. at

63, we must next determine whether the duty to defend is a

coverage question.   We have held that the duty to defend is a

“coverage question” if the complaint alleges claims that would,

if proven, fall under the policy.    Voorhees v. Preferred Mut.

Ins. Co., 128 N.J. 165, 173-74 (1992).

    In Schmidt v. Smith, 294 N.J. Super. 569, 591 (App. Div.

1996), aff’d, 155 N.J. 44 (1998), the Appellate Division

considered the meaning of “success” in a declaratory judgment

action and concluded that a party who confirms an insurance

carrier’s duty to defend qualifies as a successful claimant even

if there is no award of damages requiring indemnification.     The

plaintiff in Schmidt filed a complaint against her manager and

                                10
his employer, alleging sexual harassment, hostile work

environment, assault, assault and battery, intentional

infliction of emotional distress, and negligent infliction of

emotional distress.   Schmidt, supra, 294 N.J. Super. at 574.

The employer’s liability insurance carrier refused to defend

either the employer or the manager, asserting that the claims

against them resulted from intentional conduct, which was

excluded under the policy.    Ibid.     The employer filed a

declaratory judgment action against its liability insurance

carrier seeking reimbursement for the counsel fees and costs

incurred defending the liability action on its own behalf and on

behalf of its manager.     Ibid.

    The trial court stayed the declaratory judgment action

pending completion of the liability trial, after which the jury

found for the plaintiff.     Id. at 574-75.    In answers to special

interrogatories, the jury found that both the employer and the

manager were liable for claims of sexual harassment and hostile

work environment, and that the manager was individually liable

for assault, assault and battery, and intentional infliction of

emotional distress.   Ibid.

    In the declaratory judgment action, the trial court held

that the employer was entitled to indemnification on the claims

of sexual harassment and hostile work environment because the

plaintiff did not show that the employer’s actions were

                                   11
intentional.   Id. at 584.   However, the court determined that

the manager was not entitled to indemnification because the acts

for which he was found liable resulted from intentional conduct.

Id. at 588.    Nevertheless, the trial court found the insurance

carrier had a duty to defend the employer and the manager, and

both were entitled to reimbursement for counsel fees and costs

incurred defending the action.    Id. at 589.

     On appeal, the Appellate Division correctly applied this

Court’s holding in Voorhees, supra, 128 N.J. at 173, that an

insurer’s duty to defend is determined by the nature of the

claims alleged in the complaint and not the merits of those

claims.   The appellate court held that, where an insured or a

third-party beneficiary of an insurance policy has established

the carrier’s duty to defend, counsel fees are recoverable

regardless of the liability determination in the underlying

case.   Schmidt, supra, 294 N.J. Super. at 591; accord Pressler &

Verniero, Current N.J. Court Rules, comment 2.6 on R. 4:42-9 at

1807 (2015) (“[A]n insured entitled to a defense under the

policy is entitled to an award of attorney’s fees for the

defense even if he is later determined not to be entitled to

indemnification.”).

     In affirming the Appellate Division, we explicitly adopted

the approach taken in Schmidt, supra, 294 N.J. Super. at 591,

that a party to a declaratory judgment action qualifies as a

                                 12
successful claimant when the insurance carrier’s duty to defend

is proven, even if there is no duty to indemnify.    Schmidt v.

Smith, 155 N.J. 44, 53 (1998) (“We affirm the conclusions of the

Appellate Division relating to [the insurance carrier’s]

liability for the defense costs incurred by [the claimants].”).

                                 C.

     We acknowledge that the award of counsel fees under Rule

4:42-9(a)(6) involves the exercise of sound discretion by the

trial court.   Passaic Valley Sewerage Comm’rs v. St. Paul Fire &

Marine Ins. Co., 206 N.J. 596, 619 (2011) (holding trial courts

have “broad discretion as to when, where, and under what

circumstances counsel fees may be proper and the amount to be

awarded”).    However, the trial court in this instance denied

Occhifinto’s motion based upon the assumption that success under

Rule 4:42-9(a)(6) “is contingent upon the securing of indemnity

coverage.”    The court’s ruling was therefore based upon its

mistaken interpretation of the meaning of “successful claimant”

under Rule 4:42-9(a)(6) rather than an exercise of its

discretion.    As an interpretation of law the trial court’s

judgment is not entitled to deference; we review legal

determinations based on an interpretation of our court rules de

novo.   State ex rel. A.B., 219 N.J. 542, 554-55 (2014); Myron,

supra, 407 N.J. Super. at 309.

                                 IV.

                                 13
     With those principles in mind, we consider the declaratory

judgment action filed by Mercer.    Mercer’s complaint explicitly

denied “a duty to defend and/or indemnify [Keppler] for any and

all acts complained of by [plaintiff],” and asked the trial

court to “declare that plaintiff Mercer does not owe a duty to

defend and/or indemnify” Keppler.    Mercer also sought to have

the trial date adjourned in the event its motion for summary

judgment was successful.4

     Mercer’s attempt to disclaim coverage by filing a

declaratory judgment action forced Occhifinto -- a third-party

beneficiary of Keppler’s liability insurance policy -- to defend

so that, if successful in the underlying liability action, he

would be able to recover damages awarded against Keppler.

     The trial court granted Occhifinto’s summary judgment

motion without mentioning Mercer’s duty to defend Keppler.

However, the court held that Mercer would be required to

indemnify Keppler in the event Keppler was found liable.     The

trial court thus concluded that the complaint alleged claims

that would, if proven, fall under Keppler’s policy with Mercer.

See Voorhees, supra, 128 N.J. at 173.    That conclusion finds


4 Mercer’s contention that it did not contest its duty to
defend Keppler is inconsistent with Mercer’s request for an
adjournment of the trial contained in its motion for summary
judgment; the adjournment request’s obvious design was to
provide Keppler with an opportunity to obtain substitute counsel
in the event that Mercer’s motion was granted.
                               14
support in this record based upon our independent review of the

pleadings and we see no basis for its disturbance.    The trial

court’s additional determination that Mercer may have a duty to

indemnify Keppler had the practical result of enforcing Mercer’s

duty to defend.    Occhifinto thus succeeded in the declaratory

judgment action by forcing Mercer to continue to defend Keppler

in the liability action.

    By forcing Mercer to defend Keppler in the liability action

Occhifinto “obtain[ed] a favorable adjudication on the merits on

a coverage question as the result of the expenditure of

[counsel] fees.”    Transamerica, supra, 108 N.J. at 63.   Thus,

Occhifinto was a successful claimant under Rule 4:42-9(a)(6).

See ibid.   This conclusion is consistent with the policy goals

we articulated in Sears, supra, that Rule 4:42-9(a)(6) seeks to

discourage insurance companies from filing declaratory judgment

actions to avoid their contractual obligations to provide the

coverage for which their insureds have contracted.    134 N.J. at

356; see also Guarantee Ins., supra, 217 N.J. Super. at 610.

                                 V.

    Because the trial court concluded in the declaratory

judgment action that the complaint filed in the liability action

alleged claims that would, if proven, fall under Keppler’s

liability insurance policy with Mercer, thereby enforcing

Mercer’s duty to defend, Occhifinto was a successful claimant

                                 15
entitled to counsel fees pursuant to Rule 4:42-9(a)(6).5   We

therefore reverse the judgment of the Appellate Division and

remand the matter to the trial court for a determination of the

amount of counsel fees to be awarded to Occhifinto.



     CHIEF JUSTICE RABNER; JUSTICES LaVECCHIA, ALBIN, PATTERSON,
and FERNANDEZ-VINA; and JUDGE CUFF (temporarily assigned) join
in JUSTICE SOLOMON’s opinion.




5 Although we held in Passaic Valley, supra, 206 N.J. at 619,
that the award of counsel fees under Rule 4:42-9(a)(6) “is not
mandatory” and that trial courts should award counsel fees based
on the “totality of the circumstances,” the decision not to
award counsel fees here was based on a misapprehension of the
law. Further, none of the factors militating against the award
of counsel fees in Passaic Valley are present here.

                               16
                  SUPREME COURT OF NEW JERSEY


NO.       A-77                                SEPTEMBER TERM 2013

ON CERTIFICATION TO             Appellate Division, Superior Court


ROBERT OCCHIFINTO and NVE INC.,

      Plaintiffs-Appellants,

                 v.

OLIVO CONSTRUCTION CO., LLC,
MARTIN OLIVO, HOUGHTON, QUARTY
& WARR, LLC, WW CONSTRUCTION AND
MASONRY STAR BUILDING SYSTEMS,
ANDRES F. ANDERSON ASSOCIATES, INC.,
DIAMOND SAND AND GRAVEL CO., INC.,
ANTUL N. SHAH, P.E., ANS CONSULTANTS, INC.,
and BARDO COX & MILLER, INC.,

      Defendants,

                 and

ROBERT S. KEPPLER MASON CONTRACTORS, LLC,
a/k/a ROBERT S. KEPPLER CONCRETE CONSTRUCTION, LLC,
and MERCER MUTUAL INSURANCE CO.,

      Defendants-Respondents.



DECIDED                May 7, 2015
                  Chief Justice Rabner                      PRESIDING
OPINION BY                  Justice Solomon
CONCURRING/DISSENTING OPINIONS BY
DISSENTING OPINION BY


                                     REVERSE AND
  CHECKLIST
                                       REMAND
  CHIEF JUSTICE RABNER                    X
  JUSTICE LaVECCHIA                       X
  JUSTICE ALBIN                           X
  JUSTICE PATTERSON                       X
  JUSTICE FERNANDEZ-VINA                  X
  JUSTICE SOLOMON                         X
  JUDGE CUFF (t/a)                        X
  TOTALS                                  7
