                                NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.




                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-5061-18T3

GEICO,

          Plaintiff-Appellant,

v.

PLAZA INSURANCE COMPANY,

     Defendant-Respondent.
_____________________________

PLAZA INSURANCE COMPANY,

          Plaintiff-Respondent,

v.

GEICO,

     Defendant-Appellant.
_____________________________

                   Argued telephonically March 23, 2020 –
                   Decided July 30, 2020

                   Before Judges Rothstadt and Mitterhoff.
            On appeal from the Superior Court of New Jersey, Law
            Division, Passaic County, Docket Nos. L-1206-19 and
            L-1586-19.

            William Hahn argued the cause for appellant (Tango,
            Dickinson, Lorenzo, McDermott & McGee, LLP,
            attorneys; William Hahn, on the briefs).

            L. Patrick Dacey argued the cause for respondent
            (Bolan Jahnsen Dacey, attorneys; L. Patrick Dacey, on
            the brief).

PER CURIAM

      In this matter arising from the entry of a personal injury protection (PIP)

arbitration award in favor of Geico, Geico appeals from the June 19, 2019 order

that denied its request for entry of judgment against Plaza Insurance Company

(Plaza) in the amount of the arbitration award. The trial judge denied Geico's

request, reasoning that entry of the award violated N.J.S.A. 39:6A-9.1(b), which

provides, "Any recovery by an insurer . . . shall be subject to any claim against

the insured tortfeasor's insurer by the injured party and shall be paid only after

satisfaction of that claim, up to the limits of the insured tortfeasor's motor

vehicle or other liability insurance policy." We agree that the statute precluded

entry of judgment in Geico's favor in the amount of the arbitration award, as that

amount substantially exceeded the value of the Plaza policy after satisfying the

settlements in the underlying personal injury actions. We affirm but remand for


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                                        2
a determination of whether Geico is entitled to the balance, if any, of the Plaza

policy.

      The facts are undisputed. On October 2, 2015, a multi-vehicle collision

occurred on Interstate 80 in Paterson. Geico's insured, Antonio Del-Rosario,

"brak[ed] for the cars spinning out of control and . . . was hit from behind by a

truck" driven by an employee of TFB Trucking LLC (TFB). Geico provided

Del-Rosario with PIP benefits for various bodily injuries. Plaza insured TFB's

vehicle, and the policy had liability limits of $1,000,000.

      On July 31, 2017, Del-Rosario commenced a personal injury action

against various drivers involved in the collision, including TFB and its

employee. Thereafter, Maximino Vargas, a passenger also involved in the

collision, commenced a similar action against various drivers.

      On September 19, 2017, Geico filed a complaint against Plaza, TFB, and

TFB's employee, seeking recovery for PIP payments made to Del-Rosario and

demanding arbitration, pursuant to N.J.S.A. 39:6A-9.1. Plaza, through John

Gilmore of Corporate Claims Service, Plaza's claims administrator, consented

to resolving the matter through Arbitration Forums, Inc. (AF). Geico filed a

notice of dismissal of its September 19 complaint and filed its claim with AF.




                                                                         A-5061-18T3
                                        3
      AF's PIP arbitration agreement provided that "[n]o company shall be

required, without its written consent, to arbitrate any claim or suit if . . . any

payment which such signatory company may be required to make . . . is or may

be in excess of its policy limits."      The agreement further provided that

"arbitration lacks jurisdiction when an award will exceed a member's policy

limits." If an award is entered nevertheless, the responding company may raise

a policy limits defense by filing an inquiry on AF's website within sixty days of

publication of the decision. The filing company has "the option to accept the

policy limits as final settlement and forego recovery of the claim against the

insured directly or have the decision voided to pursue alternative means of full

recovery." In addition to the terms stated in the arbitration agreement, the

arbitration case summary indicated the parties agreed to be governed by the New

Jersey Arbitration Act (Arbitration Act), N.J.S.A. 2A:23B-1 to -32.

      The arbitration was initially scheduled for December 18, 2017, but at

Plaza's request, through Gilmore, it was deferred to November 2018 due to the

pendency of the personal injury actions. The arbitration eventually occurred




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                                        4
telephonically on November 26, 2018, but only counsel for Geico appeared.1 On

November 30, 2018, the arbitrator awarded Geico $205,418.72.

      On December 17, 2018, Plaza, through Avery, filed a post-decision

inquiry with AF, requesting that the case be deferred, as the personal injury

actions still had not been resolved. Avery explained that the initial deferment

had not been renewed before the November 2018 arbitration because the prior

claims handler no longer represented Plaza, and "the renewal was apparently

missed due to clerical error." On January 30, 2019, AF responded:

            [T]here is no appeal process under the PIP Forum. This
            docket came out of deferment. No additional deferment
            was requested by either party so the case went to
            hearing. If the member wanted another deferment it
            should have been requested prior to the materials due
            date. This issue cannot be addressed post hearing. . . .

            Unfortunately, the issue you raised does not constitute
            a clerical or jurisdictional error. . . .

            Based on the information in your letter and the
            Arbitration Rules, AF cannot overturn or change the
            decision. It must remain final and binding.




1
  Gilmore ended his employment with Corporate Claims Service in July 2018,
and his position was filled by Jerry Avery, who certified he had no notice that
the arbitration was scheduled for November 2018.


                                                                       A-5061-18T3
                                       5
      On February 25, 2019, the personal injury actions were settled through

mediation.   The Del-Rosario matter settled for $1,336,500, with the Plaza

insureds agreeing to pay $967,500.2

      On April 16, 2019, Geico filed a verified complaint and order to show

cause, seeking entry of judgment against Plaza after it failed to pay the

arbitration award. On May 20, 2019, Plaza also filed a verified complaint and

order to show cause, seeking an order vacating the arbitration award. 3

      On June 4, 2019, Judge Ernest M. Caposela heard oral argument on

Geico's order to show cause, and on June 19, 2019, the judge issued a written

order and statement of reasons, declining to enter judgment against Plaza.

Relying on N.J.S.A. 39:6A-9.1(b), the judge determined that "[t]he arbitrator

exceeded her power" by entering an award against Plaza while the underlying

personal injury actions were pending. The judge added, "Even if not raised after

the first deferment, the arbitrator had the obligation to inquire whether the




2
   Del-Rosario received $32,383.56 from Plaza before mediation to satisfy a
property damage claim. After subtracting the amount owed Del-Rosario
pursuant to the settlement, only $116.44 of the $1,000,000 Plaza policy
remained.
3
  These matters were consolidated under the Geico v. Plaza Insurance Co.
docket number prior to appeal.
                                                                          A-5061-18T3
                                       6
underlying matters were still pending." Because the arbitrator misapplied the

statute, the award was invalid. This appeal ensued.

      On appeal, Geico argues that Plaza did not timely file its summary action

to vacate the arbitration award, but even if it had, there was no basis to vacate

the award under either N.J.S.A. 2A:23B-23(a) or AF's PIP arbitration rules.

      Because the decision to vacate an arbitration award is a matter of law, we

review this matter de novo. Manger v. Manger, 417 N.J. Super. 370, 376 (App.

Div. 2010).

      First, we address whether Plaza timely filed a summary action to vacate

the arbitration award entered in favor of Geico. Under the Arbitration Act, a

party to an arbitration proceeding may file a summary action with the court to

vacate an arbitration award, and the court shall vacate such award if the

aggrieved party demonstrates one of the following:

              (1) the award was procured by corruption, fraud, or
              other undue means;

              (2) the court finds evident partiality by an arbitrator;
              corruption by an arbitrator; or misconduct by an
              arbitrator prejudicing the rights of a party to the
              arbitration proceeding;

              (3) an arbitrator refused to postpone the hearing upon
              showing of sufficient cause for postponement, refused
              to consider evidence material to the controversy, or
              otherwise conducted the hearing contrary to section

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                                         7
            [fifteen] of this act, so as to substantially prejudice the
            rights of a party to the arbitration proceeding;

            (4) an arbitrator exceeded the arbitrator's powers;

            (5) there was no agreement to arbitrate, unless the
            person participated in the arbitration proceeding
            without raising the objection pursuant to subsection c.
            of section [fifteen] of this act not later than the
            beginning of the arbitration hearing; or

            (6) the arbitration was conducted without proper notice
            of the initiation of an arbitration as required in section
            [nine] of this act so as to substantially prejudice the
            rights of a party to the arbitration proceeding.

            [N.J.S.A. 2A:23B-23(a) (footnotes omitted).]

The summary action "shall be filed within 120 days after the aggrieved party

receives notice of the award pursuant to section 19 of this act or within 120 days

after the aggrieved party receives notice of a modified or corrected award

pursuant to section 20 of this act." N.J.S.A. 2A:23B-23(b) (footnote omitted).

      The Arbitration Act does not address the scenario where an aggrieved

party files an application for vacation of an award and the arbitrator issues a

notice denying the request. However, we addressed a similar issue arising under

the New Jersey Alternative Procedure for Dispute Resolution Act (APDRA),

N.J.S.A. 2A:23A-1 to -30, in Citizens United Reciprocal Exchange v. Northern




                                                                          A-5061-18T3
                                        8
NJ Orthopedic Specialists, 445 N.J. Super. 371 (App. Div. 2016). The relevant

statute under the APDRA reads,

            A party to an alternative resolution proceeding shall
            commence a summary application in the Superior Court
            for its vacation, modification or correction within
            [forty-five] days after the award is delivered to the
            applicant, or within [thirty] days after receipt of an
            award modified pursuant to subsection d. of section
            [twelve] of this act[.]

            [N.J.S.A. 2A:23A-13(a).]

Finding this statute "to be ambiguous regarding the time to commence a

summary action . . . where the umpire issues an order denying modification of

the award," we considered the general purpose of the APDRA and held that

where a request for modification is denied, the aggrieved party "must fi le any

summary action 'within [thirty] days after receipt of' the order denying

modification." Citizens United, 445 N.J. Super. at 379-81. We further held that

where a modification is sought under a rule of the arbitration organization rather

than under the APDRA, if the rule "serves a comparable purpose as N.J.S.A.

2A:23A–12(d) serves in APDRA proceedings," the same deadlines for filing a

summary action apply. Id. at 382-83.

      In light of our discussion in Citizens United, we conclude that N.J.S.A.

2A:23B-23(b) is ambiguous as to the time for filing a summary action after an


                                                                          A-5061-18T3
                                        9
arbitrator issues an order denying a request to vacate an award. Plaza argues we

should construe this statute in the same manner we construed the similar

APDRA provision in Citizens United. We agree, as we perceive no reason to

employ a different analysis. We reject Geico's argument to the contrary, which

relies on the fact that the arbitration in Citizens United was governed by rules

and regulations adopted by the Commissioner of Banking and Insurance. This

distinction is inconsequential, given that the Commissioner explicitly

incorporated APDRA provisions into those regulations.

      Therefore, we conclude that under the Arbitration Act, when an arbitrator

denies a party's request to vacate an award, a summary action may be timely

filed within 120 days after receiving notification of denial of the request.

Further, we see no reason to apply different timing requirements when filing a

summary action under the rules of an arbitration organization rather than under

the Arbitration Act, provided the rules serve a comparable purpose. Here, AF's

provisions governing review for clerical and jurisdictional errors serve a purpose

comparable to the Arbitration Act's provisions for vacation or modification of

an award. See N.J.S.A. 2A:23B-24(a); N.J.S.A. 2A:23B-23(a)(4).

      Applying the 120 day period to the present matter, we conclude that Plaza

timely filed its summary action. Plaza first filed a post-decision inquiry with


                                                                          A-5061-18T3
                                       10
AF, asserting a jurisdictional error and arguing that N.J.S.A. 39:6A-9.1(b)

precluded Geico from recovering from Plaza, as the underlying personal injury

actions had not yet been resolved. AF's own reference guide includes a rule

providing that "arbitration lacks jurisdiction when an award will exceed a

member's policy limits." AF responded to this inquiry and declined to vacate

the award on January 30, 2019. Accordingly, Plaza's May 20, 2019 complaint

and order to show cause were timely, as they were filed within 120 days of the

notice rejecting the request to vacate the award.

      We now consider whether there was a basis to reject Geico's request to

enter judgment against Plaza. N.J.S.A. 39:6A-9.1 governs the recovery of PIP

benefits from a commercial vehicle's insurer and provides,

            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 payments and the amount of recovery . . .
            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. Any recovery by an
            insurer . . . pursuant to this subsection shall be subject
            to any claim against the insured tortfeasor's insurer by
            the injured party and shall be paid only after
            satisfaction of that claim, up to the limits of the insured
            tortfeasor's motor vehicle or other liability insurance
            policy.

            [N.J.S.A. 39:6A-9.1(b).]


                                                                          A-5061-18T3
                                       11
      Nevertheless, relying on Selective Insurance Co. v. National Continental

Insurance Co., 385 N.J. Super. 62 (App. Div. 2006), Geico contends that Plaza

is still required to pay the amount of the arbitration award because Plaza, not the

arbitrator, was responsible for seeking a deferment to postpone the arbitration.

In Selective Insurance, we addressed a similar issue and held that the defendant

insurer was liable to the PIP carrier for the amount of the arbitration award in

excess of policy limits because "the record evidence[d] a complete failure on the

part of [the defendant insurer] to defend itself by taking the proper steps to

confine its liability to the limits of its policy." Id. at 71-72.

      While we acknowledge the similarities between Selective Insurance and

the present matter, we decline to adopt the same analysis, as a different version

of N.J.S.A. 39:6A-9.1 applied in that matter. A 2011 amendment to N.J.S.A.

39:6A-9.1, effective since January 28, 2011, added the following provision:

"Any recovery by an insurer . . . shall be subject to any claim against the insured

tortfeasor's insurer by the injured party and shall be paid only after satisfaction

of that claim, up to the limits of the insured tortfeasor's motor vehicle or other

liability insurance policy." L. 2011, c. 11, § 1 (emphasis added). Our Supreme

Court explained that this "amendment altered the reimbursement scheme

established by the pre-amendment statute . . . . making a PIP carrier's


                                                                           A-5061-18T3
                                         12
reimbursement contingent on full satisfaction of the insured's claims." Johnson

v. Roselle EZ Quick LLC, 226 N.J. 370, 391 (2016).

      Given the Court's reasoning and the addition to the statute expressly

limiting the amount of a PIP carrier's recovery, we decline to hold Plaza liable

to Geico for an amount exceeding the $1,000,000 policy. To decide otherwise

would be in derogation of N.J.S.A. 39:6A-9.1(b). Although we do not wish to

dissuade insurers from filing a timely deferment where appropriate and

permissible, the record suggests that Plaza's failure to file the deferment was

inadvertent and that it took steps after entry of the arbitration award to defend

itself by timely filing a post-decision inquiry and summary action. Further,

Geico is not unjustly prejudiced by this decision because if Plaza had filed a

second deferment, Geico in any event would have been entitled to only the

balance of the Plaza policy after the personal injury claims were settled. This

decision also does not unjustly benefit Plaza, as it has the effect of requiring

Plaza to pay out the entire policy. Most importantly, to hold otherwise would

encourage PIP carriers to subrogate against a commercial tortfeasor's insurer

before an injured party's claim was settled and risk depletion of the policy to the

detriment of innocent injured parties, the very evil the 2011 amendment to

N.J.S.A. 39:6A-9.1(b) was designed to eliminate.


                                                                           A-5061-18T3
                                       13
      Accordingly, we affirm the denial of Geico's request to enter judgment

against Plaza in the amount of $205,418.72. We remand for a determination of

whether there remains a balance in the Plaza policy, and if so, whether Geico is

entitled to such balance.

      To the extent we have not addressed the parties' remaining arguments, we

conclude they are without sufficient merit to warrant discussion in a written

opinion. R. 2:11-3(e)(1)(E).

      Affirmed and remanded for further proceedings consistent with our

opinion. We do not retain jurisdiction.




                                                                        A-5061-18T3
                                      14
