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Liberty Mutual Insurance Co. v. Thomson

May 3, 2006

LIBERTY MUTUAL INSURANCE COMPANY, PLAINTIFF-APPELLANT,
v.
CHRISTOPHER THOMSON*FN1 AND HERTZ RENTAL CORPORATION, DEFENDANTS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Bergen County, DC-24155-04.

The opinion of the court was delivered by: Wecker, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued December 21, 2005

Before Judges Wecker, Fuentes and Graves.

Plaintiff, Liberty Mutual Insurance Company, appeals a summary judgment (1) dismissing its claim against defendants Hertz Rental Corporation and Christopher Thomson for reimbursement of Personal Injury Protection (PIP) benefits paid to Liberty's insured and (2) denying its cross-motion to compel arbitration of that claim under N.J.S.A. 39:6A-9.l. We affirm.

Liberty's insured, Alexsandr Rebe, was injured when his car was struck by a Hertz rental vehicle operated by co-defendant Christopher Thomson, a resident of Australia. Liberty paid PIP benefits totaling $7,487.55 on Rebe's behalf, as required by the terms of the automobile insurance policy issued to Rebe, and later demanded reimbursement from Hertz.

The Hertz vehicle was registered in New York and rented to Thomson in North Carolina, under a rental agreement that provided for the vehicle to be returned in New York State. The rental agreement contained this provision:

THIS PROTECTION WILL CONFORM TO THE BASIC REQUIREMENTS OF ANY APPLICABLE MANDATORY "NO FAULT" LAW BUT DOES NOT INCLUDE "UNINSURED MOTORIST," "UNDERINSURED MOTORIST," "SUPPLEMENTARY NO FAULT" OR ANY OTHER OPTIONAL COVERAGE. TO THE EXTENT PERMITTED BY LAW, HERTZ AND YOU HEREBY WAIVE AND REJECT THE INCLUSION OF SUCH PROTECTION.

If such protection is imposed by operation of law, then the limits of such protection will be the minimum required for primary liability protection by the law of the jurisdiction in which the accident occurs. Hertz warrants that the protection described in this subparagraph is primary with respect to any insurance coverage which You or an Authorized Operator may have.

Hertz thereby acknowledged its obligation to provide the mandatory coverage "imposed by operation of law" in any jurisdiction where an accident might occur.

N.J.S.A. 39:6B-1(a) requires that "[e]very owner or registered owner of a motor vehicle registered or principally garaged in [New Jersey] shall maintain motor vehicle liability insurance . . . ." (Emphasis added). See Agency Rent-a-Car, Inc. v. Indem. Ins. Co. of N. Am., 268 N.J. Super. 319, 322-23 (App. Div. 1993). N.J.S.A. 39:6A-4 mandates that "every standard automobile liability policy . . . shall contain personal injury protection benefits for the payment of benefits without regard to . . . fault of any kind, . . . to the named insured . . . who sustain[s] bodily injury as a result of an accident while occupying, entering into, alighting from or using an automobile . . . ."

Hertz was self-insured with respect to the Thomson rental car. A motor vehicle rental company is permitted to self-insure "if it can reasonably satisfy the commissioner of banking and insurance as to the permanence and financial standing of its business." N.J.S.A. 45:21-8; Agency Rent-a-Car, supra, 268 N.J. Super. at 322. Under N.J.S.A. 39:6-52(a), "[a]ny person in whose name more than 25 motor vehicles are leased may qualify as a self-insurer by obtaining a certificate of self-insurance issued by the Commissioner of Insurance as provided in subsection (b) of this section."

Under the No-Fault Law, N.J.S.A. 39:6A-1 to -34, our courts have consistently held that "a self-insurer's coverage obligations are co-extensive with the obligations of those possessing liability policies." Ryder/P.I.E. ...


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