                                NOT FOR PUBLICATION WITHOUT THE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-2939-18T1


ACE AMERICAN INSURANCE
COMPANY,

          Plaintiff-Appellant,

v.

OLD REPUBLIC GENERAL
INSURANCE CORP., and NATIONAL
UNION FIRE INSURANCE COMPANY
OF PITTSBURGH, PA,

          Defendants,

and

EVEREST NATIONAL INSURANCE
COMPANY, and PENNSYLVANIA
MUTUAL CASUALTY INSURANCE
COMPANY, a/k/a and d/b/a PENN
NATIONAL INSURANCE,

     Defendants-Respondents.
_____________________________________

                    Argued December 11, 2019 – Decided January 3, 2020

                    Before Judges Haas and Mayer.
             On appeal from the Superior Court of New Jersey, Law
             Division, Bergen County, Docket No. L-1801-18.

             Todd Jason Leon argued the cause for appellant (Hill
             Wallack LLP, attorneys; Todd Jason Leon, of counsel
             and on the briefs; Joshua S. Fischer, on the briefs).

             Timothy P. Smith argued the cause for respondent
             Pennsylvania Mutual Casualty Insurance Company
             (Kinney Lisovicz Reilly & Wolff PC, attorneys; Kevin
             E. Wolff, of counsel and on the brief; Timothy P. Smith,
             on the brief).

             Kennedys CMK LLP, attorneys for respondent Everest
             National Insurance Company (Gary S. Kull and Alexa
             Jean Nasta Schmid, on the brief).

PER CURIAM

       Plaintiff ACE American Insurance Company (ACE) appeals from a

November 29, 2018 order granting summary judgment to defendant

Pennsylvania National Mutual Casualty Insurance Company (Penn National)1

and a January 28, 2019 order granting summary judgment to defendant Everest

National Insurance Company (Everest). The motion judge determined the six-

year statute of limitations, N.J.S.A. 2A:14-1, barred ACE's declaratory judgment

action for defense costs and indemnification. We affirm.




1
    Improperly pleaded as Pennsylvania Mutual Casualty Insurance Company.
                                                                        A-2939-18T1
                                        2
       The facts giving rise to ACE's declaratory judgment action are as follows.

D'Andrea Construction Company, Inc. (D'Andrea) was the general contractor

for a school construction project. D'Andrea contracted with Thomas Lindstrom

Steel & Company, Inc. (Lindstrom) to provide steel work for the project.

D'Andrea was sued by an employee of Lindstrom for injuries allegedly caused

by a D'Andrea employee at the construction site (underlying personal injury

action).2

       ACE issued a commercial general liability policy to D'Andrea. D'Andrea

was an additional insured under an automobile policy issued by Penn National.

ACE agreed to defend D'Andrea in the underlying personal injury action under

a reservation of rights.

         Lindstrom was insured under a commercial automobile policy by an

insurance carrier not involved in this appeal and a commercial excess policy

issued by Everest. ACE did not tender its claim for defense or indemnification

to Everest during the underlying personal injury action.

       The underlying personal injury action settled on the eve of trial, January

19, 2012, for $5,800,000. According to an entry in ACE's internal trial log, ACE

agreed to pay $1,750,000 of the total settlement sum and preserved its ability to


2
    The injured employee claimed he was run over by D'Andrea's backhoe.
                                                                         A-2939-18T1
                                        3
pursue claims against other insurance companies for indemnification and

defense costs.

      On the scheduled trial date, January 23, 2012, the parties reported to the

court that the underlying personal injury action settled and placed a settlement

agreement on the record before the judge. The parties to the underlying personal

injury action subsequently signed a settlement agreement and release on March

28, 2012. A stipulation of dismissal with prejudice was filed on April 20, 2012.

      On March 12, 2018, ACE filed a declaratory judgment action against Penn

National, Everest, and other insurance companies, seeking reimbursement of the

settlement payment and legal costs incurred in representing D'Andrea in the

underlying personal injury action. ACE claimed Penn National and Everest

insured D'Andrea and should have defended and indemnified D'Andrea in that

action.

      Penn National moved for summary judgment, arguing the six-year statute

of limitations barred ACE's declaratory judgment action. Everest joined in Penn

National's motion.

      ACE opposed both motions, contending the six-year statute of limitations

on its claim for reimbursement of costs in the underlying personal injury action

did not commence until April 20, 2012, the filing date of the stipulation of


                                                                        A-2939-18T1
                                       4
dismissal. Alternatively, ACE claimed its cause of action against Penn National

and Everest did not accrue until March 28, 2012, the date the written settlement

agreement and release resolving the underlying personal injury action was

signed by all parties. Based on these dates, ACE argued its March 12, 2018

declaratory judgment action was timely filed.

      The motion judge heard counsels' arguments on November 2, 2018. In a

thirteen-page written opinion, Judge Robert L. Polifroni granted summary

judgment to Penn National and Everest.

      The judge, finding the six-year statute of limitations for contract actions

governed insurance actions, concluded the facts were "incontrovertible" and

evidenced "an enforceable and final settlement was reached" in the underlying

personal injury action on January 23, 2012. Judge Polifroni held ACE's claim

for reimbursement of the settlement payment and defense costs was barred by

the statute of limitations because the declaratory judgment action was filed more

than six years after the settlement of the underlying personal injury action.

      We affirm for the reasons expressed by Judge Robert L. Polifroni in his

detailed and thorough November 29, 2018 written decision. We add only the

following comments.




                                                                          A-2939-18T1
                                        5
      Generally, the statute of limitations begins to run when the cause of action

accrues, meaning the date on which the right to file suit arose. Johnson v.

Roselle EZ Quick LLC, 226 N.J. 370, 394 (2016) (citing White v. Mattera, 175

N.J. 158, 164 (2003)). When a plaintiff has knowledge of the facts regarding an

injury and fault giving rise to a cause of action, the limitations period

commences. Burd v. N.J. Tel. Co., 76 N.J. 284, 291-92 (1978). A plaintiff need

not know the legal effect of those facts, ibid., nor the full extent of its injuries

to begin the clock for calculating the period of limitations. Russo Farms, Inc.

v. Vineland Bd. of Educ., 144 N.J. 84, 115 (1996) (citing P.T. & L. Constr. Co.

v. Madigan & Hyland, Inc., 245 N.J. Super. 201, 207 (App. Div. 1991)).

      A cause of action for indemnification traditionally accrues when the

indemnitee becomes responsible to pay a claim. Holloway v. State, 125 N.J.

386, 399 (1991). Responsibility to pay a claim can be established by a court

judgment or binding settlement. Crest-Foam Corp. v. Aetna Ins. Co., 320 N.J.

Super. 509, 519 (App. Div. 1999) (quoting Condenser Serv. & Eng'g Co. v. Am.

Mut. Liab. Ins. Co., 45 N.J. Super. 31, 41 (App. Div. 1957)). A formal written

settlement agreement and release is not required to effectuate a binding

settlement. Hagrish v. Olson, 254 N.J. Super. 133, 137-38 (App. Div. 1992).




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                                         6
      Here, ACE's cause of action for indemnification and defense costs against

Penn National and Everest no later than January 23, 2012, the date ACE became

legally obligated to pay damages in the underlying personal injury action. See

Crest-Foam, 320 N.J. Super. at 517-21 (holding that a cause of action for

indemnification and defense costs accrued when damages were fixed by final

judgment or settlement).     Therefore, ACE's March 12, 2018 declaratory

judgment action was barred by the six-year statute of limitations.

      Affirmed.




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