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Poray v. Royal Globe Insurance Co.

Decided: March 16, 1966.


Civil action. Findings of fact and conclusions of law.

Smith, J.c.c. (temporarily assigned).


[90 NJSuper Page 456] This matter is before the court at the suit of plaintiffs for a declaratory judgment and is submitted on stipulation. Plaintiff James Foy failed to appear either personally or by counsel when the matter was set down for trial. As will appear hereafter, Foy is not an indispensable party and the issue may be resolved in spite of his nonappearance.

On July 4, 1962 Poray was operating a vehicle owned by Vicki Zarilli when it was in a collision with a vehicle driven by Foy. Vicki Zarilli was killed in the collision and Poray and Foy were injured. The Zarilli vehicle was insured by Royal Globe Insurance Company and the policy extended coverage to Poray under the omnibus clause. As a result of the death arising out of the collision Poray was required to post bail at a cost of $85.50. Following the collision Foy instituted a suit against Poray and Zarilli, and later Poray filed a suit against Foy, who was uninsured at the time of the accident.

On July 19, 1962 Mr. Gormley, of Royal Globe, advised Poray's attorneys that Royal Globe would pay Poray's bail bond premium of $85.50. On July 27, 1962 a representative of Royal Globe obtained a signed statement from Poray relative to the collision. On August 3, 1962 the summons and complaint served upon Poray in Foy v. Poray was forwarded to Royal Globe to undertake the defense of Poray, as provided by the policy. On August 24, 1962 a representative of Royal Globe sent answers to interrogatories for Poray to sign. On November 7, 1962 Poray's attorneys requested Royal Globe to provide it with a copy of Poray's statement about the accident previously given to them, and at the same time advised Royal Globe that a complaint was being filed on behalf of Poray against Foy. On December 12, 1962 Royal Globe, by its attorneys, consented to an order of consolidation of the Foy v. Poray and Poray v. Foy suits. On January 26 and March 23, 1963 the deposition of Poray was taken and Royal Globe by its attorney appeared and participated. Thereafter, on June 14, 1963 Royal Globe appeared by its attorney and participated in the pretrial conference of the consolidated actions.

On December 27, 1963 Poray's attorneys by telephone asked Mr. Gormley of Royal Globe to advise them if the Zarilli policy contained uninsured motorist coverage. He replied he did not know but would advise the following week. Upon his failure to inform Poray's attorneys they again telephoned

him on January 3, 1964, at which time Gormley said he would forward a copy of the policy, but this was not done.

Subsequently Poray and Foy (the uninsured motorist), by their attorneys, filed a complaint against Royal Globe and the Unsatisfied Claim and Judgment Fund Board in an effort to make discovery of the Zarilli policy and to extend coverage to Foy on the Poray claim. Finally, on May 23, 1964, more than five months after Royal Globe agreed to furnish a copy of the policy and after the institution of this action, Royal Globe's attorney forwarded a copy of the policy to Foy's attorney, who provided a copy to Poray's attorney. On July 9, 1964 Poray's attorney served interrogatories upon Royal Globe in which they sought to ascertain the grounds of Royal Globe's denial set forth in the answer in this action, and also whether Royal Globe's consent was given for the action brought by Poray against Foy and whether Royal Globe demanded arbitration. Royal Globe failed to answer the interrogatories within the time provided under the Rules.

On October 21, 1964 the consolidated actions of Foy and Poray were reached for trial (Royal Globe appeared in defense of Zarilli) and a jury returned a verdict in Poray's favor in the amount of $4,000 and costs, and a no cause for action on the Foy complaint. After the judgment in Poray's favor Royal Globe, on November 24, 1964, finally answered the interrogatories propounded in this action after Poray's attorneys had made a written demand on Royal Globe on November 18 to pay the judgment together with the bail bond premium of $85.50 and medical payments in the amount of $1,091.40. Royal Globe refused to pay any of the amounts and made no offers of settlement.

Royal Globe's position is that although the policy afforded protection against uninsured drivers such as Foy, Poray failed to comply with certain conditions precedent, including arbitration as the policy required; that Poray failed to obtain Royal Globe's consent in writing before institution of the Poray v. Foy suit as provided by the policy, and further, that Poray failed to comply with all other conditions precedent to

the policy, especially notice, assistance and cooperation of the insured, action against company, medical reports (relating to medical payment provisions, Part II, Section VII), proof and payment of claim and proof of claim, and medical reports (relating to uninsured motorist provisions, Part IV, Section IX). The arbitration provision as to protection ...

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