On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Mercer County.
Morton I. Greenberg, O'Brien and Gaynor.
The appeal in this matrimonial-tort action challenges the mandated joinder of plaintiff's and defendant's insurer as a third-party defendant, with respect to claims for indemnification and recovery of Personal Injury Protection benefits arising from the asserted tort, as not being within the recently prescribed jurisdiction of the Chancery Division, Family Part, or required or permitted under rules pertaining to the joinder of claims or parties. We agree and reverse.
Plaintiff's complaint pleaded a cause of action for divorce on grounds of extreme cruelty and also sought recovery for personal injuries allegedly sustained as a result of defendant's acts
of cruelty. Both counts of the complaint are founded upon the alleged shooting of plaintiff by defendant and his subsequent attempt to strangle her. The tort claims were pleaded in the alternative as being based upon either the intentional or negligent conduct of the defendant with both compensatory and punitive damages being demanded. Defendant's insurer, Allstate Insurance Company (Allstate), was notified by letter of the claims being asserted by plaintiff for personal injuries and coverage was sought under defendant's homeowners policy. Coverage was disclaimed by Allstate. Defendant responded to the disclaimer by filing a motion to join Allstate as a third-party defendant in the pending action. On the return day of this motion, which was about two weeks prior to the scheduled trial date, an order was entered not only joining Allstate as a third-party defendant but also ordering it to provide the defense in the underlying action and declaring that Allstate should be responsible for the payment of any judgment obtained against defendant to the extent of its coverage. Upon receiving a copy of this order and notwithstanding that it had not yet been formally served, Allstate filed an answer to the third-party complaint and a counterclaim for a declaratory judgment as to the coverage issue. At the same time it moved to vacate the order and to transfer the third-party complaint and the counterclaim from the Chancery Division to the Law Division. This motion was heard on the day of trial and by order dated April 20, 1984 the court vacated its prior order except for the joinder of Allstate as a third-party defendant, ruling that Allstate had no right to a jury trial, and provided that all issues raised by the complaint, third-party complaint and the declaratory judgment counterclaim should be joined in the pending action. The order also granted plaintiff permission to file an amended complaint setting forth a claim for PIP benefits under an automobile policy issued by Allstate. The trial date was postponed and Allstate was permitted a limited time for discovery.
The matter is now before us on Allstate's appeal from this interlocutory order pursuant to leave previously granted. Its
primary complaints are the declaratory judgment action should be tried in the Law Division as the relief sought is legal in nature, the consolidation deprives it of a jury trial and the entire controversy doctrine or the rules governing joinder and practice in the Family Part do not require that the issues relating to coverage and PIP benefits be joined in the matrimonial-tort action. Error is also claimed in the failure of the court to dismiss the third-party complaint for insufficiency of service and in limiting Allstate's discovery period.
Plaintiff and defendant-third-party plaintiff maintain that the challenged action of the trial court was a proper exercise of its discretion and in accord with the intent of the rule prescribing the jurisdiction of the Chancery Division, Family Part. They consider the joinder of the coverage questions in the matrimonial-tort action to be a logical method of adjudicating these issues as being derivative of plaintiff's personal injury claim and encompassed within the controversy between the plaintiff and defendant. Allstate's claim of entitlement to a jury trial on its counterclaim for a declaratory judgment is answered by the assertion that no jury trials are available in the Family Part.
It is recognized that declaratory relief may be granted by either division of the Superior Court. Government Employees Ins. Co. v. Butler, 128 N.J. Super. 492, 495 (Ch.Div.1974). More importantly, however, such relief is "neither equitable or legal in itself, but takes on the color of either, depending upon the issues involved." Id. 128 N.J. Super. at 495 (citations omitted). An action for a declaratory judgment as to the rights of parties to an insurance policy is basically an action for the construction of a contract generally cognizable before the law courts. Id., 128 N.J. Super. at 496.
Obviously, the correct procedure requires an insurance carrier to commence its declaratory judgment action relating to questions of coverage in the Law Division, move for a consolidation with or restraint of any pending third-party liability action, and then litigate its rights under the insurance policy. Likewise, the insured may resort to the same or similar procedure when the carrier ...