This action comes before the court on a motion by the defendant Concord Insurance Company (Concord) for an order striking the complaint for reasons that will be set forth at length below. In order to determine the merits of this motion, it is necessary to set forth the facts preceding it. The question of law herein appears novel.
On or about December 24, 1968 Ethel Oderman was involved in an accident with Calvin Joyner. Prior to the accident Joyner had taken out a liability insurance policy with Concord for one year, effective January 19, 1968. The policy was financed by the Lenox Finance Company (Lenox), paid by it to Concord on behalf of Joyner. Sometime before the accident the premiums were not received by Concord and the policy was cancelled as of December 16, 1968, six days before the accident.
Mrs. Oderman subsequently brought suit in the county district court for damages sustained. When Joyner asked his carrier, Concord, to defend, it refused, claiming that the cancellation relieved it of this obligation. Mrs. Oderman, upon learning of the disclaimer, filed a notice of intention to make a claim with the Unsatisfied Claim and Judgment Fund Board (Fund), pursuant to N.J.S.A. 39:6-65. As a result, the present action was instituted by the Fund in the Superior Court, Law Division, for a declaratory judgment to determine whether it or Concord was the proper party to defend Joyner in the county district court suit. The Fund also brought a second count against Lenox for negligence in processing the finance payments, and for indemnification of any adverse judgment it might suffer as the result of such
negligence. This count charges that Joyner made each monthly payment to Lenox as it came due, and only because of Lenox's failure to forward it to Concord was there a lapse in the payment of the necessary premiums.
The motion before the court is in response to the declaratory judgment action of the plaintiff Fund. Defendant Concord is seeking to strike the complaint on the following grounds:
A. The Fund has no standing to bring this type of action;
B. It has other recourse, namely, to deny payment after a judgment is rendered, on the grounds that the judgment debtor was insured at the time of the accident;
C. Only the alleged insured or a qualifying third-party beneficiary can bring this type of action, and
D. Even if the Fund could properly seek such relief, the relief sought is the proper subject matter of the Chancery and not the Law Division.
The court is compelled to disagree with these contentions for various reasons. It is of the opinion that the best interests of justice will be served by the determination of this issue prior to, instead of after, the county district court matter is heard.
The issues raised will be more clearly understood if discussed individually rather than collectively. The court's attention is initially ...