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New Jersey Auto. Full Ins. Underwriting Ass'n By and Through CSC v. Liberty Mut. Ins. Co.

Decided: January 19, 1994.

NEW JERSEY AUTOMOBILE FULL INSURANCE UNDERWRITING ASSOCIATION, BY AND THROUGH ITS SERVICING CARRIER, CSC, PLAINTIFF-RESPONDENT,
v.
LIBERTY MUTUAL INSURANCE COMPANY, DEFENDANT-APPELLANT



On appeal from the Superior Court of New Jersey, Law Division, Burlington County.

King, Havey and A.a. Rodriguez. The opinion of the court was delivered by Rodriguez, A.a., J.s.c. (temporarily assigned).

Rodriguez

The issue raised by this appeal is whether N.J.S.A. 39:6A-9.1 requires that a carrier seeking reimbursement of personal injury protection (PIP) benefit payments made to its insured must assert its rights against the tortfeasor's insurer by demanding formal arbitration within two years of the filing of the PIP claim. We hold that it does. Accordingly, we reverse and remand for the entry of summary judgment in favor of defendant Liberty Mutual Insurance Company.

The facts are not disputed. Lisa Altidor was involved in an automobile accident on February 23, 1990 when her vehicle was struck by one owned by Comcast Cable One (Comcast). Altidor was insured by plaintiff, New Jersey Automobile Full Insurance Underwriting Association, through its servicing carrier CSC Insurance Services. She filed a claim for PIP benefits on March 7, 1990 and received her first payment on March 27, 1990. Twenty-two months later, on January 29, 1992, plaintiff sent a form letter to Comcast's carrier, defendant Liberty Mutual Insurance Company (Liberty) advising of its "subrogation interests."*fn1 This letter did not demand arbitration. Instead it contained this request: "please send us your check including the deductible amount payable to CSC Insurance Services as subrogee of our above named insurer." Since no response was received, on March 30, 1992 plaintiff's claims adjuster sent a second letter inquiring as to the reason for nonpayment. That letter contained the following language "if no reply is received within fifteen days, we will file arbitration/suit." On April 6, 1992, Liberty's representative replied

that payment was being declined because the "statute of limitations" had expired.

On April 24, 1992, plaintiff through counsel formally demanded arbitration pursuant to N.J.S.A. 39:6A-9.1. Because Liberty refused to arbitrate, plaintiff filed a verified complaint and an order to show cause. Liberty cross-moved for summary judgment. The motion Judge concluded that the statute requires only that a carrier seeking recovery give notice of its request within two years of the filing of the PIP claim. Because the letter sent to Liberty on January 30, 1992, (within two years of the filing of the PIP claim) constituted such notice, the Judge held that the limitation was satisfied, denied Liberty's motion for summary judgment and ordered that the PIP reimbursement claim be submitted to binding arbitration.

On appeal, Liberty contends that N.J.S.A. 39:6A-9.1 mandates that in order to recover PIP benefits paid to an insured, a carrier must formally demand arbitration within two years of the filing of the PIP claim. Conversely, plaintiff contends that notice within two years of the PIP claim that a carrier will be seeking recovery is sufficient unless prejudice can be shown. Alternatively, plaintiff argues that the arbitration demand made on April 24, 1992 was timely with respect to those bills which were received within two years. We agree with Liberty's position.

In pertinent part, N.J.S.A. 39:6A-9.1 provides:

An insurer, . . . paying . . . personal injury protection benefits . . . as a result of an accident occurring within this state, shall, within two years of the filing of the claim, have the right to recover the amount of payment from any tortfeasor who was not, at the time of the accident, required to maintain personal injury protection or medical expenses benefit coverage . . . under the laws of the state . . . . In the case of an accident occurring in this state involving an insured tortfeasor, the determination as to whether an insurer . . . is legally entitled to recover the amount of payment . . . shall be made against the insurer of the tortfeasor, and shall be by agreement of the involved parties or, upon failing to agree, by arbitration.

When a statute is clear on its face, a court need not look beyond its terms to determine the Legislature's intent. "If the language is plain and clearly reveals the meaning of the statute,

the court's sole function is to enforce the statute in accordance with those terms." Department of Law & Public Safety v. Bigham, 119 ...


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