This is a motion by Woodbridge Township and Gallagher Bassett Services, Inc. for Summary Judgment dismissing the Complaint of State Farm Mutual Auto Insurance Company (State Farm) and a cross-motion by State Farm for Summary Judgment.
State Farm brought a declaratory judgment action seeking a determination that: 1) Richard George, an employee of Woodbridge Township and a State Farm policy holder, is barred by the Fireman's Rule from proceeding with his uninsured motorist (UM) claim; 2) Woodbridge Township has sufficient UM
coverage to satisfy the underlying claim; and 3) such coverage should be prorated with that of State Farm.
The facts in this case are not in dispute. Mr. George's UM claim arises out of an accident which occurred on August 4, 1987, in which Mr. George, while acting in his capacity as police officer for Woodbridge Township, was injured by an uninsured motorist. As of the accident date, Woodbridge Township was self-insured for the first $50,000 of any loss, with excess coverage provided by Lloyds of London for $450,000. The dispute before this court centers on the question of who will be responsible for any possible future arbitrator's award in Mr. George's UM claim.
A UM claim has a dual nature; it combines elements of contract and tort law. As noted by the court in Ross v. Transport of New Jersey, 114 N.J. 132, 553 A.2d 12 (1989), "an uninsured motorist claim is a statutory cause of action which has many characteristics of a tort action." Id. at 145, 553 A.2d 12. As such, reference to provisions of both the No Fault Act and the Tort Claims Act is necessary to understanding and resolving this claim.
Woodbridge Township, as a self-insurer pursuant to N.J.S.A. 40A:10-6, is required to carry UM coverage. Ross, 114 N.J. at 144, 553 A.2d 12; Christy v. City of Newark, 102 N.J. 598, 608, 510 A.2d 22 (1986); Allstate Ins. Co. v. Alvarado, 227 N.J. Super 152, 154, 549 A.2d 905 (Law Div.1988). Such UM coverage is governed by N.J.S.A. 17:28-1.1 which provides in pertinent part:
"c. Uninsured and underinsured motorist coverage provided for in this section shall not be increased by stacking the limits of coverage of multiple motor vehicles covered under the same policy of insurance nor shall these coverages be increased by stacking the limits of coverage of multiple policies available to the insured. If the insured had uninsured motorist coverage available under more than one policy, any recovery shall not exceed the higher of the applicable limits of the respective coverages and the recovery shall be
prorated between the applicable coverages as the limits of each coverage bear to the total of the limits."
In addition, Woodbridge Township, as a public entity, is governed by the Tort Claims Act whenever questions of tort liability arise. N.J.S.A. 59:1-1 et seq.; Ross, 114 N.J. at 145, 553 A.2d 12; Transport of New Jersey v. Matos, 202 N.J. Super. 571, 575, 495 A.2d 503 (Law Div.1985). Relevant to this dispute is N.J.S.A. 59:9-2(e), which states:
"e. If a claimant receives or is entitled to receive benefits for the injuries allegedly incurred from a policy or policies of insurance or any other source other than a joint tortfeasor, such benefits shall be disclosed to the court and the amount thereof which duplicates any benefit contained in the award shall be deducted from any award against a public entity or public employee recovered by such claimant; provided, however, that nothing in this provision shall be construed to limit the rights of a beneficiary under a life insurance policy. No insurer or other ...