On certification to the Superior Court, Appellate Division.
For affirmance -- Chief Justice Hughes and Justices Mountain, Sullivan, Pashman, Clifford, Schreiber and Handler. For reversal -- None.
In this declaratory judgment action plaintiff seeks a determination as to the applicability and effect of the uninsured motorist (UM) endorsements in automobile insurance policies issued by defendant insurance companies.
On August 7, 1972 plaintiff, Stanley Ciecka, was a passenger in an automobile owned and operated by one William Landolt when it collided with an automobile owned and operated by one Augustin Cardona. As a result of the collision plaintiff sustained personal injuries. Cardona was uninsured. Defendant-appellant, Transamerica Insurance Company, insured the Landolt vehicle for liability with a limit of $50,000 damages on account of bodily injury to one person. The same policy contained an uninsured motorist endorsement in standard form,*fn1 binding the insurer to
pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured highway vehicle because of bodily injury or property damage, caused by accident
and arising out of the ownership, maintenance or use of such uninsured highway vehicle; provided, for the purposes of this coverage, determination as to whether the insured or such representative is legally entitled to recover such damages, and if so the amount thereof, shall be made by agreement between the insured or such representative and the company or, if they fail to agree, by arbitration.
In addition, plaintiff had a policy of insurance on his own automobile with defendant Home Indemnity Insurance Company (Home), which contained an uninsured motorist endorsement in the same form as Transamerica's.*fn2
Ciecka instituted suit against both drivers. Transamerica interposed a defense for Landolt, and the Unsatisfied Claim and Judgment Fund answered for Cardona. Ciecka then negotiated a settlement with Transamerica for the available $50,000 policy limit on the bodily injury liability coverage. The parties filed a Stipulation of Dismissal and Transamerica paid the $50,000.
Plaintiff then made a demand under the UM endorsements of both policies, alleging damages on account of personal injuries in excess of $70,000 and seeking the maximum of $10,000 under
each UM endorsement.*fn3 The carriers resisted arbitration, taking the position that their UM coverages were beyond plaintiff's reach inasmuch as he had already been paid the full limit of Transamerica's liability coverage. Defendants relied on certain "exclusions" and "limits of liability" affecting UM coverage in their respective policies. Plaintiff then commenced the instant action for declaratory relief, in which the parties agreed that for purposes of this suit both drivers were negligent and plaintiff's injuries carried with them a value in excess of $50,000.
The trial court found in plaintiff's favor, determining that the UM coverage of both the host driver and the injured plaintiff were available, with Home's policy (plaintiff's) excess or secondary to the Transamerica policy (host driver's). On Transamerica's appeal the Appellate Division, in an unreported opinion, affirmed. We ...