RUTGERS CASUALTY INS. CO. VS NJ MANUFACTURERS INS. CO.

(NOTE: This decision was approved by the court for publication.)
This case can also be found at 294 N.J. Super. 379.

NOT FOR PUBLICATION WITHOUT THE
 
APPROVAL OF THE APPELLATE DIVISION
 

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-2632-95T2

RUTGERS CASUALTY INSURANCE
COMPANY,

Plaintiff-Appellant,

v.

NEW JERSEY MANUFACTURERS
INSURANCE COMPANY,

Defendant-Respondent.

_________________________________________________________________

Argued October 8, 1996 - Decided October 24, 1996

Before Judges Stern, Humphreys and Wecker.See footnote 1

On appeal from the Superior Court of New
Jersey, Law Division, Camden County.

Susan L. Moreinis argued the cause for
appellant (Ms. Moreinis, on the brief).

Robert R. Nicodemo, III, argued the cause
for respondent (Yampell & Nicodemo,
attorneys; Richard V. Cosentino, on the
brief).

PER CURIAM

Carmen Klass was eligible for no fault PIP benefits as an "eligible injured person" under New Jersey Manufacturers' (NJM) policy covering the car in which she was riding and the Rutgers Casualty (Rutgers) policy in which she was named insured.

Rutgers appeals from the grant of summary judgment to NJM dismissing Rutgers' declaratory judgment action seeking equitable pro-rata contribution from NJM and requiring its participation in arbitration. Rutgers claims entitlement to such relief under N.J.S.A. 39:6A-11 (section 11) and argues that enactment of N.J.S.A. 39:6A-4.2 (section 4.2) has no effect on NJM's obligations under section 11.
NJM defends the summary judgment under N.J.S.A. 39:6A-4.2, contending that our opinion in USF&G v. Industrial Indem. Co., 264 N.J. Super. 379 (App. Div. 1993), is distinguishable because the injured person there was not a named insured under either policy (whereas here she is a named insured under the Rutgers policy) and that, in any event, our approval in USF&G of Cokenakes v. Ohio Casualty Ins. Co., 208 N.J. Super. 308, 313-14 (Law Div. 1985), was erroneous as a matter of policy and legislative intent.
NJM contends that section 4.2 makes the named insured's carrier solely responsible unless the PIP benefits are exhausted; Rutgers argues that the section merely assures the obligation of the primary carrier to pay PIP benefits while the question of contribution is arbitrated. In USF&G, supra, 264 N.J. Super. at 382, decided after the 1990 amendment to section 4.2, we held that a primary carrier may seek contribution under section 11 from "other available PIP coverage" and that the enactment of section 4.2 did not affect that obligation. We held that "the purpose of 4.2 was to identify a source for the immediate

payment of PIP benefits, thereby insulating covered persons from delays caused by squabbles between insurers." Id. at 384. We adhere to that holding and conclude that USF&G governs even when the insured party is a named insured, notwithstanding that section 4.2 expressly provides that the PIP "coverage of the named insured shall be the primary coverage for the named insured ...." In these circumstances that carrier is "primary" but may nevertheless seek contribution under section 11 even though the PIP payments did not exceed the policy limits.
Reversed.

Footnote: 1Judge Wecker did not participate in the argument, but with the consent of the parties has participated in the disposition of the appeal. - -