On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-5499-06.
The opinion of the court was delivered by: Messano, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Wefing, Messano and LeWinn.
Plaintiff Anthony Tonic appeals from the dismissal with prejudice of his complaint seeking underinsured motorist (UIM) benefits pursuant to an automobile insurance policy issued to his employer by defendant American Casualty Company, improperly pled as CNA Insurance Co. Having considered the arguments raised on appeal in light of the record and applicable legal standards, we reverse and remand the matter for further proceedings consistent with this opinion.
On January 2, 2006, plaintiff was employed as a bus driver for a shuttle service that operated between Newark Airport and the Hampton Inn in Linden.*fn1 The bus was owned by his employer, Hersha Enterprises, Inc., and was insured under a policy issued by defendant. As plaintiff was entering the bus at the airport, he was struck by the side mirror of a passing van that drove off without stopping. Plaintiff sustained injuries as a result, and ultimately underwent back surgery.
The following day, plaintiff reported the accident to the Port Authority Police Department. He supplied the police with the license plate number of the van, as well as a description of the driver -- a stocky, Hispanic male with black hair, a mustache and glasses. The police identified the van's owner, Luz Marina Canon of Selden, New York. Plaintiff subsequently learned that Canon maintained insurance on the van through State Farm Insurance Company (State Farm) and that the bodily injury limits of the policy were $25,000 per person and $50,000 per accident.*fn2
On July 11, 2006, plaintiff filed a complaint against defendant, Canon and "John Doe 1-3." In the first count, he demanded that defendant "[p]rocess his UM/UIM claim" under the policy of insurance issued to his employer, and he sought damages as a result of his injuries. In the second count, plaintiff sought damages caused by the negligence of Canon and/or "John Doe 1-3" identified as the "operator of [the] van." On October 12, 2006, defendant filed its answer and asserted a cross-claim against Canon and the John Doe defendants. Canon also filed an answer, and discovery ensued.
On August 28, 2007, Canon was deposed by defendant.*fn3 She claimed that on the date of the accident, she was married to Francisco Vasquez and both were in Florida on vacation.
Although she and Vasquez had since separated, Canon claimed that he owned his own taxi cab and maintained an insurance policy on it. Also, on the accident date, Canon lived in the same apartment with Everett and Adrina Palasios who owned two cars. After being notified of plaintiff's claim, Canon asked Mr. Palasios if he had driven her van while she was away; he denied that he had. Canon admitted that she regularly left the keys to the van in a drawer in a table in her room. Two months after the accident, Canon sold the van to Oscar Marino, with whom she later entered into a romantic relationship.
On September 19, 2007, defendant moved for partial summary judgment arguing that since Canon was insured by State Farm, plaintiff had no viable claim for uninsured motorist (UM) benefits under its policy. Plaintiff cross-moved for partial summary judgment seeking a declaration that the van was owned by Canon, that he was entitled to UIM benefits under defendant's policy, and he sought appointment of a UIM arbitrator. Defendant did not file opposition to the cross-motion.
While the motions were pending, on October 8, 2007, plaintiff sent a letter to defendant's attorney stating,
This confirms discussions that plaintiff, if offered the $25,000 . . . as settlement for claim against defendant Canon and John Doe, driver of her car, . . . would accept this offer of the . . . policy [limit] . . . if the UIM carrier does not object within 30 days and pursuant to the Longworth*fn4 doctrine.
On October 12, 2007, plaintiff's counsel sent another letter indicating that State Farm had offered the policy limit in settlement of the claim. He further indicated that "[t]his is [an] additional [Longworth] Notice . . . [and] unless a written objection is received within 30 [days], plaintiff will send releases to defendant Canon."
On October 19, the motion judge entered two orders. One granted defendant's motion for partial summary judgment "as to plaintiff's UM claims only." The second order granted plaintiff's request for declaratory relief "that the vehicle alleged . . . to have caused his injuries was owned by . . . Canon . . . ." It further provided that "plaintiff [wa]s . . . eligible for [a] UIM claim which [wa]s to proceed in due course[,]" and it additionally ordered defendant to "designate their [sic] arbitrator in the UIM claim . . . within (30) days."
On November 5, 2007, defense counsel sent plaintiff's counsel a letter naming an arbitrator. The letter additionally noted,
[W]e will be maintaining that you do not qualify for UIM. A motion on same will be forthcoming. It would appear that you failed to amend the complaint to name the driver. As a result, our subrogation rights have not been protected.
The record does not reveal that defendant had ever previously requested that plaintiff amend his complaint.
On November 7, 2007, plaintiff's counsel responded that despite diligent efforts, he was unable to identify the driver of the van. He further noted that "UIM regulations permit[ted] [defendant] to take over th[e] suit so that no release [would be] given to State Farm." He asked defendant to "provide . . . the facts that would support [its] contention that [Canon's] boyfriend was the driver." Counsel closed by stating his intention to file a motion "to move this claim along." On November 9, plaintiff moved for an "order permitting [him] to send [a] release to [State Farm] or . . . [alternatively] . . . requiring defendant . . . to pay [the] settlement offered by . . . Canon."
For reasons that are never fully explained in the record, however, Canon had already moved for summary judgment. The order granting that motion, dated November 16, reflects that neither plaintiff nor defendant filed opposition. We have not been provided with any of the motion papers. Why the motion was filed in the first instance remains a mystery, since on November 29, State Farm sent a letter to plaintiff confirming the offer to settle the case for Canon's policy limits.
On November 28, defendant cross-moved for summary judgment. In his certification, citing Canon's interrogatory answers that she neither drove the van nor was it "operated on her behalf" on the day of the accident, defense counsel claimed that Canon's motion for summary judgment sought dismissal "based on lack of agency." He failed to explain, however, why defendant had not opposed Canon's motion.
Defense counsel further certified that he had notified plaintiff within thirty days of receipt of the Longworth notice that he "did not qualify for UIM benefits as he failed to amend the complaint to name the driver." Citing Canon's testimony that her husband and Mr. Palasios had access to the keys to her van, defendant claimed both should have been named as defendants. Counsel continued that "no viable tortfeasor" remained in the case because Canon had been granted summary judgment. Citing the policy of insurance, counsel claimed "defendant's [subrogation] rights have been impaired as the [c]omplaint was not properly amended . . . ."
Plaintiff filed opposition to defendant's cross-motion. His attorney certified that he had never received the order granting Canon summary judgment and urged that it be vacated because the case was "settled prior to trial [and] [i]t would interfere with the rights of the UIM carrier should it decide to pay the $25,000 . . . policy to the plaintiff and pursue the case against defendants." He argued that Canon's motion was filed by mistake since he had settled the case directly with State Farm's adjuster. Plaintiff further contended that although ...