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Tandon v. Hamilton

July 3, 2007

SUBHASH TANDON AND SUDERSHAN TANDON, PLAINTIFFS-APPELLANTS,
v.
EDWARD P. HAMILTON AND UNSATISFIED CLAIM AND JUDGMENT FUND BOARD, A BODY OF POLITIC OF THE STATE OF NEW JERSEY, DEFENDANTS-RESPONDENTS, AND EDWARD P. HAMILTON, THIRD-PARTY PLAINTIFF,
v.
ATLANTIC INDEMNITY INSURANCE CO. THIRD-PARTY DEFENDANT.



On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-12304-98.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued May 15, 2007

Before Judges Lisa, Holston, Jr. and Grall.

Plaintiff, Subhash Tandon, appeals the Law Division's December 5, 2005 order of disposition. The order recites that plaintiff's personal injury negligence complaint against defendant, Edward P. Hamilton (Hamilton), resulted in a settlement while the matter was scheduled for trial.

On November 17, 1998, plaintiff served a personal injury negligence complaint on Hamilton and the Unsatisfied Claim and Judgment Fund Board (UCJFB)*fn1 arising out of a June 1, 1998 bicycle/motor vehicle accident.

The relevant facts giving rise to the complaint may be summarized as follows. Plaintiff was riding a bicycle on Broadway in Newark on June 1, 1998 when he was struck by a parked car door that suddenly opened in front of him. Plaintiff sustained injuries to his left elbow, knee and shoulder, required open reduction surgery on his elbow and has permanent disability in his elbow. Hamilton was the owner and operator of the parked car. Hamilton's permanent residence in the police report was listed as Florida and his driver's license was issued in Florida. However, his vehicle had New Jersey license plates and was registered at an East Orange address.

During the course of discovery, Hamilton revealed that he made arrangements to obtain automobile insurance through Atlantic Indemnity Insurance Company (Atlantic), an insurance company headquartered in North Carolina and unlicensed to issue insurance policies in New Jersey. Hamilton had purchased his policy through Insurance Services Management Agency, an agent in Florida, which apparently never forwarded Hamilton's premium payments to Atlantic or issued a policy for him. Atlantic denied writing any policies in New Jersey and initially refused to provide coverage to Hamilton.

Hamilton asserted that if he were uninsured, it was through no fault of his own. As a result, Hamilton filed a third-party action against Atlantic seeking a declaratory judgment (DJ), that Atlantic owed him liability insurance coverage and a defense to plaintiff's complaint.

On December 17, 1999, plaintiff's then attorney, Jeffrey Beckerman, Esquire, received a letter from the attorney for the UCJFB, stating that personal injury protection (PIP) benefits were not available to plaintiff because Hamilton was operating an out-of-state vehicle. Therefore, the UCJFB would not pay plaintiff's medical costs. On January 10, 2000, Beckerman conveyed this information to plaintiff and advised him that without PIP benefits, his only hope for recovery was if Hamilton had liability insurance on the date of the accident. Plaintiff notified Beckerman and the UCJFB that Hamilton's car was in fact registered in New Jersey and therefore fell within this State's PIP statute. On January 14, 2000, Beckerman wrote another letter to plaintiff confirming that plaintiff was correct and that he was eligible for medical benefits from the UCJFB.

At the trial call on March 12, 2001, a settlement was apparently agreed upon between Beckerman, the attorney for the UCJFB, and the attorney for Atlantic. Plaintiff's bodily injury claim would be settled contingent upon the outcome of the DJ action. If Hamilton prevailed, Atlantic agreed to pay plaintiff the full $10,000 in coverage under the Atlantic policy and the claim against UCJFB would be dismissed. If Atlantic won the DJ action, UCJFB would settle the case for at least the $10,000 Atlantic would have paid.

Prior to the September 10, 2001 trial date for the DJ action, Atlantic settled with Hamilton, agreeing to provide him $10,000 in coverage, which it would pay to plaintiff. However, Atlantic would not pay any PIP benefits to plaintiff. Plaintiff refused to sign a release. As a result, on November 13, 2002, UCJFB and Hamilton filed a motion to enforce the settlement. On December 11, 2002, the motion judge signed an order enforcing litigant's rights pursuant to Rule 1:10-3. Plaintiff, thereafter, filed a motion to vacate the order enforcing litigant's rights, which was denied.

On appeal from the order denying plaintiff's motion to vacate settlement, in an unpublished per curiam opinion, we exercised our original jurisdiction under Rule 2:10-5 and invalidated the settlement and remanded for further proceedings. Tandom v. Hamilton, No. A-4013-03T3, (App. Div. February 5, 2005) (slip op at 7). We determined that it was the Legislature's intent for PIP benefits to be promptly paid through its enactment of N.J.S.A. 39:6A-4 and N.J.S.A. 39:6-86.1 and for UCJFB to pay PIP benefits without the uninsured injured party first having to pursue the insured liable party in the automobile accident. Id. at 7, 9-10.

We noted that under the purported settlement, the UCJFB committed itself to paying "at least $10,000," if in the DJ action Atlantic was held not to be responsible to provide coverage to Hamilton, Id. at 10. Because the UCJFB took the "extreme position" of not covering plaintiff's medical expenses, despite knowledge that Hamilton's car was registered in New Jersey, plaintiff was left without any source to pay approximately $17,000 in medical expenses, except for his share of the $10,000, after expenses and attorneys fees. Id. at 11. We, therefore, held the settlement was ...


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