On appeal from the Superior Court, Law Division, Union County.
Approved for Publication November 8, 1995.
Before Judges Havey, D'Annunzio & Conley. The opinion of the court was delivered by Havey, P.j.a.d.
The opinion of the court was delivered by: Havey
The opinion of the court was delivered by HAVEY, P.J.A.D.
Plaintiff Karin I. Derfuss is insured by defendant New Jersey Manufacturers Insurance Company (NJM) under a policy providing underinsured motorist (UIM) coverage. Plaintiff sustained injuries as a result of an automobile accident with an underinsured tortfeasor. Pursuant to the terms of the policy, an arbitration panel awarded plaintiff $350,000 and apportioned forty percent liability against her. The Law Division Judge granted plaintiff a trial de novo on both the damage and liability issues. A jury thereupon awarded her $500,000 and found her twenty percent liable for the accident.
We conclude that the arbitrators' determination as to liability was binding, and thus, plaintiff had no right to a trial de novo on the issue. We therefore reverse the order granting plaintiff a trial de novo on liability and reduce plaintiff's $500,000 damage verdict rendered by the jury to $300,000, to reflect the arbitrators' allocation of forty percent liability against plaintiff. We affirm the award of prejudgment interest.
Plaintiff was injured in an August 31, 1990, two-car accident in a shopping mall parking lot in South Plainfield. She settled with the tortfeasor for $100,000, the limit under the tortfeasor's liability policy.
On August 3, 1992, plaintiff filed a complaint against NJM because of a dispute concerning her entitlement to personal injury protection (PIP) coverage under her policy. The parties were also unable to settle plaintiff's UIM claim. NJM's UIM endorsement provides for arbitration if the parties do not agree as to whether the insured is "legally entitled to recover damages" or as to the "amount of damages." It also provides:
Unless both parties agree otherwise, arbitration will take place in the county in which the insured lives. Local rules of law as to procedure and evidence will apply. A decision agreed to by two of the arbitrators will be binding as to:
1. Whether the insured is legally entitled to recover damages; and
2. The amount of damages. This applies only if the amount does not exceed the minimum limit for liability specified by the financial responsibility law of New Jersey. If the amount exceeds the limit, either party may demand the right to a trial. This demand must be made within 60 days of the arbitrators' decision. If this demand is not made, the amount of damages agreed to by the arbitrators will be binding.
On February 23, 1993, plaintiff's UIM claim was arbitrated, and the arbitrators unanimously found plaintiff forty percent responsible for the accident and awarded damages in the amount of $350,000.
Plaintiff moved to amend her complaint to seek a trial de novo on her UIM claim. On March 19, 1993, the motion was granted, but only as to the quantum of damages. On plaintiff's reconsideration motion, the Judge concluded that plaintiff was entitled to a de novo review as to both damages and liability since, according to the Judge, the UIM arbitration provision was "ambiguous."
During the jury trial, plaintiff, her mother, and two friends testified concerning plaintiff's injury and the impact it had on her life. The de bene esse testimony of neurosurgeon Paul C. McCormick, M.D., was also offered by plaintiff. Extensive testimony from reconstruction specialists was presented by both sides concerning ...