This case raises the issue of whether a cash settlement recovered pursuant to the uninsured motorist provision of the defendant's insurance policy, as a consequence of the death of the parties' minor daughter, is to be considered the proceeds of an insurance contract payable to defendant, or damages distributable under the Wrongful Death Act.
This matter was heard on the return date of an order to show cause why defendant should not be ordered to account to plaintiff for a distributive share of the funds recovered in a wrongful death action. Based upon the affidavits submitted in this action, the court makes the following findings of fact: On August 3, 1973, Katherine Satzinger, minor daughter of plaintiff and defendant, was killed in an automobile accident. At the time of the fatal crash, decedent was covered under the uninsured motorist provision of her mother's automobile insurance policy. Defendant, divorced wife of plaintiff, was appointed general administratrix of her daughter's estate and granted administration ad prosequendum for a wrongful death action. Defendant herein instituted a wrongful death action, joining as defendants, among others, the deceased
driver of the uninsured vehicle in which her daughter was a passenger, and her own insurance carrier, New Jersey Manufacturers Insurance Company. On November 14, 1975 the trial judge in that action entered an order dismissing the complaint against New Jersey Manufacturers Insurance Company on the grounds that it had been improperly joined as a party to the liability claim. The trial proceeded on the issue of liability only, and on March 17, 1977 judgment was entered holding the deceased and uninsured driver, Earl Levers, solely responsible for the death of Katherine Satzinger.
Shortly thereafter defendant negotiated a $12,500 settlement with her insurance company, New Jersey Manufacturers, pursuant to the maximum $15,000 uninsured motorist coverage of her policy. Defendant's affidavit states that acceptance of the settlement "obviated the necessity of proceeding with a damage trial." Thus, on June 28, 1977 defendant withdrew her than pending damage complaint "in light of the settlement reached with [her] own insurance carrier."
Decedent was survived by her mother and father and four older sisters. Each of the sisters executed a renunciation of all right and interest in the settlement proceeds in favor of her mother, defendant Mary Satzinger. Plaintiff claims that under the Wrongful Death Act, N.J.S.A. 2A:31-4, and the intestate succession statute, N.J.S.A. 3A:4-4, he is entitled to a one-sixth (1/6) share of the net proceeds of the settlement between defendant and her insurance carrier.
Plaintiff further demands reimbursement from defendant for the $1,050 that he expended toward his daughter's funeral expenses. The total cost of the funeral and burial was $2,190.
It is defendant's position that all monies received were the result of her contract of insurance with New Jersey Manufacturers (NJM) and were "independent and wholly separate from the maintenance of any wrongful death action." Defendant maintains that all proceeds are payable to
her because of the happening of an event for which she had voluntarily, and without assistance from plaintiff, purchased insurance; namely, the demise of a member of her household by an uninsured motorist. Defendant concludes that "it is virtually as if [plaintiff] sought to recover on a life insurance policy maintained on the life of the decedent by one of her sisters * * *."
Both parties and the court agree that this is a case of first impression in the State of New Jersey. However, having carefully considered the uninsured motorist statute, the language of the insurance policy and the case law in this and other jurisdictions, the court does not hesitate in holding that the proceeds of a settlement agreement between a policy holder and her own insuror, reached pursuant to the uninsured motorist provision of the policy, represent damages caused by a negligent and uninsured motorist. The court further holds that in the case of death of an insured, the settlement proceeds are to be distributed among those persons who are entitled to take any intestate personal property of the decedent, and in the proportions in which they are entitled to take the same.
Initially, it must be understood that defendant's purchase of uninsured motorist protection was not voluntary. Her insurance policy went into effect on January 12, 1973. As of January 1, 1973 no automobile liability policy or renewal of such policy could issue unless it included uninsured motorist coverage. N.J.S.A. 17:28-1.1; Motor Club of America Ins. Co. v. Phillips , 66 N.J. 277, 284 (1974); Walkowitz v. Royal Globe Ins. Co. , 1 ...