2019 WL 2163613

United States District Court, S.D. Alabama, Southern Division.
Willie J. FIGGERS, Plaintiff,
v.
CARROLL FULMER LOGISTICS CORP., d/b/a Carroll Fulmer Trucking, et al., Defendants.
CIVIL ACTION NO. 17-00476-KD-MU
|
Signed 05/17/2019
Attorneys and Law Firms
Lonita R. Walker-Mede, Birmingham, AL, for Plaintiff.
Aaron Mathew Wiley, D. Gregory Dunagan, Carr Allison, Daphne, AL, for Defendant Carroll Fulmer Logistics Corp.
D. Gregory Dunagan, Carr Allison, Daphne, AL, for Defendant Richard A. Freeman.

ORDER
KRISTI K. DuBOSE, CHIEF UNITED STATES DISTRICT JUDGE
*1 This action is before the Court on Defendant Richard Freeman’s motion to dismiss or in the alternative, motion for summary judgment, Plaintiff Willie J. Figgers’ response, and Freeman’s reply (docs. 64, 69, 70). The Court addresses the motion as a motion for summary judgment.1 Upon consideration, the motion is GRANTED and Figgers’ claims against Freeman are dismissed with prejudice.

I. Background
Figgers alleges that he was struck by a tractor trailer owned by Carroll Fulmer Logistics Corp. and driven by Freemen on July 20, 2015. Figgers alleges that Freeman and Fulmer were negligent (Counts Two and Four). Under Alabama law, a cause of action for negligence must be filed within two years from the date of the accident or injury. Ala. Code § 6-2-38(l).2 The initial complaint which named John Doe, as the driver of the tractor trailer, was filed July 20, 2017. The action was removed to this Court on October 27, 2017 (doc. 1). On December 28, 2017, Fulmer provided its initial disclosures to Figgers wherein Freeman was identified as the driver (doc. 11, doc. 30-1). The Rule 16(b) Scheduling Order set April 30, 2018 as the deadline for motions for leave to amend the pleadings or to join parties (doc. 12, ¶ 5).

Figgers’ motion for leave to amend to substitute Freeman for the John Doe driver was filed December 5, 2018 (doc. 27). The motion was granted and Figgers filed the amended complaint on March 4, 2019 (docs. 34, 43). Fulmer moved to strike the amended complaint and the motion was denied (docs. 47, 57). The amended complaint was served upon Freeman on March 8, 2019 (doc. 51). The summons was served on March 18, 2019 (doc. 59). In response, Freeman filed the instant motion to dismiss, or in the alternative motion for summary judgment.

II. Statement of the law

A. Summary judgment
“The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a) (Dec. 2010). Freeman, as the party seeking summary judgment bears “the initial burden to show the district court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991) (the party seeking summary judgment “always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,’ which it believes demonstrate the absence of a genuine issue of material fact.”) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2553 (1986)). In deciding whether Freeman has met his initial burden, the Court must review the record and draw all reasonable inferences therefrom in a light most favorable to Figgers, as the non-moving party. See Whatley v. CNA Ins. Co., 189 F.3d 1310, 1313 (11th Cir. 1999).

*2 Once Freeman meets this responsibility, the burden shifts to Figgers, as the non-movant, to show the existence of a genuine issue of material fact that would preclude summary judgment. See Matsushita Elec. Indus. Co. Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). “In reviewing whether the [non-movant has met the] burden, the court must stop short of weighing the evidence and making credibility determination of the truth of the matter. Instead, the evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Tipton v. Bergrohr GMBH-Siegen, 965 F.2d 994, 999 (11th Cir. 1992) (citing Anderson v. Liberty Lobby, 477 U.S. 242, 255, 106 S. Ct. 2505 (1986) (bracketed text added)). However, Freeman would be entitled to summary judgment if Figgers fails “to make a sufficient showing on an essential element of [his] case with respect to which [he has] the burden of proof.’ ” In re Walker, 48 F. 3d 1161, 1163 (11th Cir. 1995) (quoting Celotex Corp., 477 U.S. at 323, 106 S. Ct. at 2552) (bracketed text added). Overall, the Court must “resolve all issues of material fact in favor of the [Plaintiff], and then determine the legal question of whether [Defendant is] entitled to judgment as a matter of law under that version of the facts.” McDowell v. Brown, 392 F.3d 1283, 1288 (11th Cir. 2004) (citing Durruthy v. Pastor, 351 F.3d 1080, 1084 (11th Cir. 2003)) (bracketed text added).

The mere existence of any factual dispute will not automatically require denial of a motion for summary judgment; rather, only factual disputes that are material preclude entry of summary judgment. Lofton v. Secretary of Dept. of Children and Family Services, 358 F.3d 804, 809 (11th Cir. 2004). “An issue of fact is material if it is a legal element of the claim under the applicable substantive law which might affect the outcome of the case. It is genuine if the record taken as a whole could lead a rational trier of fact to find for the nonmoving party.” Reeves v. C.H. Robinson Worldwide, Inc., 594 F.3d 798, 807 (11th Cir. 2010) (citation omitted).

B. Relation back
This action is before the Court on basis of diversity jurisdiction. 28 U.S.C. § 1332(a)(1). In an en banc decision, the Court of Appeals for the Eleventh Circuit held that Federal Rule of Civil Procedure “15(c)(1) allows federal courts sitting in diversity to apply relation-back rules of state law where, as here, state law provides the statute of limitations for the action.” Saxton v. ACF Industries, Inc., 254 F.3d 959, 963 (11th Cir. 2001). Rule 15(c) states in relevant part as follows:
(c) Relation Back of Amendments.
When an Amendment Relates Back. An amendment to a pleading relates back to the date of the original pleading when: … the law that provides the applicable statute of limitations allows relation back[.]
Fed. R. Civ. P. 15(c)(1)(A).

Alabama law provides the applicable two-year statute of limitations for negligence actions. See Ala. Code § 6-2-38(l) (“All actions for any injury to the person or rights of another not arising from contract and not specifically enumerated in this section must be brought within two years.”). Therefore, the Court will apply Alabama’s relation back principles. Rule 15(c) and Rule 9(h) of the Alabama Rules of Civil Procedure “allow a plaintiff to avoid the bar of a statute of limitations by fictitiously naming defendants for which actual parties can later be substituted.” Ex parte Lucas, 212 So.3d 921, 926 (Ala. 2016) (citations omitted).

Alabama Rule of Civil Procedure 15(c) provides in relevant part as follows:
(c) Relation Back of Amendments. An amendment of a pleading relates back to the date of the original pleading when
(1) relation back is permitted by the law that provides the statute of limitations applicable to the action, or
…
(4) relation back is permitted by principles applicable to fictitious party practice pursuant to Rule 9(h).
Ala. R. Civ. P. 15(c).

Alabama Rule 9(h) states as follows:
When a party is ignorant of the name of an opposing party and so alleges in the party’s pleading, the opposing party may be designated by any name, and when that party’s true name is discovered, the process and all pleadings and proceedings in the action may be amended by substituting the true name.
*3 Ala. R. Civ. P. 9(h).

“Construing Alabama’s Rule 15(c)(4) and Rule 9(h) together, the relation-back standard under Alabama law (as recognized by both the Alabama Supreme Court and the Eleventh Circuit in the diversity context) is as follows:
“Rules 9(h) and 15(c), Ala. R. Civ. P., allow a plaintiff to avoid the bar of a statute of limitations by fictitiously naming defendants for which actual parties can later be substituted. Such a substitution is allowed to relate back to the date of the original complaint if the original complaint adequately described the fictitiously named defendant and stated a claim against such a defendant. In order for the substitution to relate back, the plaintiff must show that he was ignorant of the true identity of the defendant and that he used due diligence in attempting to discover it.”
Wyatt v. Georgia-Pacific LLC, 2018 WL 1308954, *2-3 (S.D. Ala. 2018) (emphasis in original) (quoting Saxton, 254 F.3d at 965) (other citations omitted).

“Thus, under Alabama law, an amendment substituting an actual defendant for a fictitious defendant relates back when: (1) the original complaint adequately described the fictitious defendant; (2) the original complaint stated a claim against the fictitious defendant; (3) the plaintiff was ignorant of the true identity of the defendant; and (4) the plaintiff used due diligence to discover the defendant’s true identity.” Id., (quoting Saxton, 254 F.3d at 965 (citation omitted)). Under Alabama law, a “plaintiff is ignorant of the identity of a fictitiously named defendant when, after exercising due diligence to ascertain the identity of the party intended to be sued, he lacks knowledge at the time of the filing of the complaint of facts indicating to him that the substituted party was the party intended to be sued.” Ex parte Lucas, 212 So.3d 921, 926 (Ala. 2016) (citations omitted) (emphasis in original). “ ‘It is incumbent upon the plaintiff to exercise due diligence to determine the true identity of defendants both before and after filing the original complaint.’ ” Ex parte Integra LifeSciences Corporation, 2018 WL 4090569, *5 (Ala. 2018) (quoting Ex parte Hensel Phelps Const. Co., 7 So.3d 999, 1003 (Ala. 2008)).

Additionally, the Alabama Supreme Court “has elaborated upon the requirement that the plaintiff be ignorant of the identity of the fictitiously named party by holding that the plaintiff must substitute the named defendant for the fictitious party within a reasonable time after determining the defendant’s true identity.” Ex parte Mobile Infirmary Ass’n, 74 So.3d 424, 429 (Ala. 2011) (citations omitted). Therefore, after the lawsuit is filed, “to invoke the relation back principle of Rule 15(c), a plaintiff … must proceed in a reasonably diligent manner to determine the true identity of a fictitiously named defendants and to amend his complaint accordingly.” Ex parte Hensel Phelps Constr. Co., 7 So.3d at 1003. (citation omitted). “Although the express language of the statute does not require the plaintiff to substitute the named defendant for the fictitious party within a reasonable time after determining the defendant’s true identity, [the Alabama Supreme Court] has imposed such a duty.” Ex parte Klemawesch, 549 So.2d 62, 64 (Ala. 1989).

III. Analysis
*4 Freeman argues that summary judgment should be granted in his favor because Figgers’ negligence claims against him do not relate back to the original complaint and are barred by the two-year statute of limitation. Freeman argues that Figgers failed to exercise reasonable diligence in substituting Freeman after learning his identity.

As an initial consideration, the Court finds that the original complaint adequately described John Doe as the driver of the tractor trailer and that the original complaint stated a claim against him. Wyatt, 2018 WL 1308954, *3. (the first two elements). With respect to whether Figgers was ignorant of the true identity at the time the original complaint was filed, Freeman argues that his identity was made known to Figgers’ first attorney in an October 2015 email, approximately 21 months before the original complaint was filed in July 2017 (doc. 64-1, copy of email). Freeman states that Figgers’ first attorney confirmed in a July 2018 email that he had turned over his entire file, presumably including the 2015 email, to Figgers when he withdrew from the case (doc. 64-2, copy of email).

In response, Figgers argues that neither he nor his current counsel who filed the original complaint on Figgers’ behalf were aware of the October 2015 email or its content.3 Figgers also points out that in the July 2018 email, his first counsel stated that “It appears that I provided copies of everything that was a part of my file to Mr. Figgers at the time I withdrew from representation.” (doc. 69, p. 12, underlining in response). Arguably, an issue of fact may exist as to whether the October 2015 email was included in the file such that with the exercise of reasonable diligence – looking through the file – Figgers could have learned Freeman’s identity.

However, there is no dispute of fact that Freeman’s identity was disclosed to Figgers and his current counsel on December 28, 2017 in the initial disclosures (doc. 11, doc. 30-1).4 Thus, the Court looks to whether Figgers acted in a reasonably diligent manner to amend his complaint within a reasonable period of time after the initial disclosures. Ex parte Hensel Phelps Const. Co., 7 So.3d at 1003 (To invoke the relation back principle of Alabama Rule 15(c), the plaintiff “must proceed in a reasonably diligent manner to determine the true identity of a fictitiously named defendants and to amend his complaint accordingly.”) (underlining added).

*5 Figgers, however, waited until December 5, 2018, which was after the April 30, 2018, deadline for amendment of pleadings and joining of parties and nearly 12 months after the initial disclosure, to move to amend his complaint to substitute Freeman for the John Doe driver. Figgers has not offered any reason why he did not proceed in a reasonably diligent manner to move to amend. Instead, Figgers argues that the Court “previously addressed the issue on whether the Amended Complaint could stand” and “previously adjudicated” the matter when it granted his motion for leave to amend and denied Fulmer’s motion to strike the amended complaint (doc, 69, p. 3-4). Figgers argues that because the matter has been decided and Fulmer did not appeal the decision, principles of res judicata and collateral estoppel prevent reconsideration of this matter. (Id., p. 4, 6, 9-10).5

The Court disagrees with Figgers and finds that his argument does not provide a basis for denying Freeman’s motion. When Figgers moved for leave to amend the complaint, he argued that Freeman was a necessary party, that leave to amend should be freely given under Rule 15(a) of the Alabama Rules of Civil Procedure,6 that there was good cause to allow the amendment, and that no party would be prejudiced (doc. 27). Figgers did not argue that the amended complaint would relate back to the original complaint (Id.). The Court ruled after consideration of Rule 16(b)(4) and 15(a)(2) of the Federal Rules of Civil Procedure (doc. 35). Importantly, the issue of whether Freeman had a viable statute of limitations defense was not addressed when the Court ruled on Figgers’ motion for leave to amend the complaint.

Additionally, Fulmer moved to strike on basis that the amended complaint was untimely filed under S.D. Ala. Civ. L.R. 15, that it was prejudicial to Freeman because he would not have time to conduct discovery and prepare a defense, and because Figgers included certain counts in the amended complaint that the Court had already dismissed on summary judgment (doc. 47). In response, Figgers specifically acknowledged that Freeman had “not raised any Motion to Strike in reference to the matter”, that Fulmer “lacks standing to argue the claims” of the then pro se Freeman, and that “[u]nder Rule 8 of the Federal Rules of Civil Procedure”, Freeman could “answer and raise his own Claims and Defenses” (doc. 53, p. 2). The Court denied Fulmer’s motion to strike the amended complaint and sua sponte struck the counts that had been dismissed on summary judgment. As Figgers anticipated (see doc. 53, p. 2), Freeman has now raised the statute of limitations defense through the instant motion.

IV. Conclusion
Lapse of nearly 12 months between the initial disclosures and the motion for leave to amend shows that Figgers did not exercise reasonable diligence to move to amend within a reasonable time period as required under Alabama law. See Ex parte Hensel Phelps Const. Co., 7 So.3d at 1004 (“Childers plainly failed to comply with the rules governing fictitious-party practice in his overall delay in ascertaining Hensel Phelps’s identity and in waiting seven months after obtaining knowledge of the identity of Hensel Phelps as a defendant to amend his complaint.”). Because Figgers’ claims against Freeman do not relate back to the original complaint, they are barred by the statute of limitations. Accordingly, summary judgment is GRANTED in favor of Freeman and the claims against Freeman are dismissed with prejudice.

*6 DONE and ORDERED this the 17th day of May 2019.

All Citations
Slip Copy, 2019 WL 2163613

Footnotes

1
Figgers states that “[i]n addition to the response that follows, Plaintiff expressly incorporates by reference her own Motion for Summary Judgment” (doc. 69, p. 1). However, Figgers did not file a motion for summary judgment with either a separate brief or a brief incorporated within the motion as required by S.D. Ala. Civ. L.R. 7(b) (“Except as ordered by the Court, any motion filed pursuant to Fed. R. Civ. P. 12(b) or 56 must be supported by a brief…. A supporting brief may be included within the body of the motion.”); see also S.D. Ala. Civ. L.R. 56(a) (“Movant’s Supporting Materials. The movant must file a brief that includes: (1) all facts relied upon, each supported by a specific, pinpoint citation to the record; and (2) argument supported by legal authority as appropriate. The movant must also file all evidence relied upon.”).

2
Figgers argues that there is no Ala. Code § 6-2-38(1). However, Figgers appears to have misread the lower-case letter “l” as the number “l”.

3
Figgers’ current counsel states that she has never spoken to the first attorney and that the first attorney did not forward any documents to her (doc. 69, p. 6).

4
Figgers argues that because Freeman’s motion is not supported by any affidavit based on personal knowledge or “demonstrative documents such as attached pleadings, depositions, answers to interrogatories and admissions on file”, it is not a properly supported motion (doc. 69, p. 7-8). However, Rule 56(c)(1)(A) states that a party may cite to “particular parts of materials in the record, including depositions, documents, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials[.]” Fed. R. Civ. P. 56(c)(1)(A). Freeman relied upon the initial disclosures which are part of the materials in the record. Id. Also, Freeman attached copies of two emails which arguably fall under “other materials” Id.

5
To the extent that Figgers argues that no party is prejudiced because Figgers and Fulmer knew that Freeman was the driver, under Alabama law, “ ‘prejudice becomes a consideration only when an amendment would otherwise relate back to the time of filing; lack of prejudice to the non-amending party will not make an otherwise improper relation back proper, where due diligence by the amending party is lacking.’ ” Ex parte Integra LifeSciences Corporation, 2018 WL 4090569, *5 (Ala. 2018) (quoting Ex parte Mobile Infirmary Ass’n, 74 So.3d 424, 430 (Ala. 2011)); see also Mobile Infirmary, 74 So.3d at 428 (the propriety of relation back “depends upon the plaintiff’s conduct”).

6
Figgers quoted from Rule 15(a) as follows: “Under Alabama Rules of Civil Procedure Rule 15, a party may amend a pleading if it is more than forty-two (42) days before the first setting of the case for trial, and such amendment shall be freely allowed when justice so requires.” (doc. 27). Figgers did not cite to or quote from Alabama Rule of Civil Procedure 15(c) that provides for relation back of amendments.

2019 WL 2218939

Superior Court of New Jersey, Appellate Division.
LIBERTY MUTUAL INSURANCE COMPANY, a corporation, and EUGENE JERINSKY, Plaintiffs-Appellants,
v.
PENSKE TRUCK LEASING, CO., a company, corporation and/or other business entity, Defendant,
and
CEVA FREIGHT, LLC, a company, corporation and/or other business entity, and ALBERT KIKA, Defendants-Respondents.
DOCKET NO. A-5624-17T3
|
Submitted March 12, 2019
|
Decided May 23, 2019
On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-3377-17.
Attorneys and Law Firms
Clark & Di Stefano, PC, attorneys for appellants (Robert P. Clark, on the briefs).
Marks O’Neill O’Brien Doherty & Kelly PC, attorneys for respondents (Michael J. Notartomas, on the brief).
Before Judges Yannotti, Rothstadt and Gilson.
Opinion

The opinion of the court was delivered by GILSON, J.A.D.

*1 Section 9.1 of the New Jersey Automobile Reparation Reform Act (the No-Fault Act), N.J.S.A. 39:6A-1 to -35, provides insurers, which have paid personal injury protection (PIP) benefits to their insured, with the statutory right to seek reimbursement against certain tortfeasors. N.J.S.A. 39:6A-9.1. If the tortfeasor is insured, the determination whether the insurer that paid the PIP benefits is entitled to recover those payments and the amount of the recovery is by agreement of the parties, and, if they are unable to agree, by arbitration. Ibid.

In this appeal, the non-PIP insurer disputes whether its insured was a tortfeasor. Thus, the question presented is whether that dispute must be arbitrated under Section 9.1 of the No-Fault Act or resolved in a court proceeding. We hold that the issue of whether a party is a tortfeasor is to be resolved at arbitration when that issue involves factual questions as to the fault or negligence of the insured.

Accordingly, on this appeal we reverse the Law Division order dated June 4, 2018, which denied the motion of plaintiff Liberty Mutual Insurance Company (Liberty or plaintiff) to compel defendant CEVA Freight, LLC (CEVA), a self-insured company, to arbitrate Liberty’s demand for reimbursement of PIP benefits. We also reverse a July 20, 2018 order denying Liberty’s motion for reconsideration. We remand with the direction that the Law Division enter an order compelling CEVA and Liberty to arbitrate both whether Liberty is entitled to the reimbursement and the amount of the reimbursement. Thus, the arbitrator will determine whether the driver of the truck, which was owned and self-insured by CEVA, was a tortfeasor.

I.
The basic facts concerning the underlying automobile accident are not in dispute. At approximately 4:45 a.m. on October 7, 2016, a tractor-trailer truck driven by Albert Kika and a pickup truck driven by Eugene Jerinsky were involved in a collision. Kika was attempting to back the truck he was driving into a car dealership located off the southbound lanes of Route 9 in Freehold. While backing into the entrance to the dealership, Kika’s truck blocked the southbound lanes of Route 9. As Kika was maneuvering his truck into the driveway, Jerinsky was driving his pickup truck in the right southbound lane of Route 9 and his pickup truck struck the trailer of Kika’s truck.

A police accident report stated that Kika “failed to yield [the] right-of-way [to] traffic” while attempting to back his tractor-trailer into the dealership driveway. A witness gave a statement and reported that he was driving his vehicle in the left southbound lane, saw the tractor-trailer blocking the roadway, and was able to stop. The witness then saw the pickup truck hit the trailer. The police report also stated that there was visible damage to the side of the trailer and the front end of the pickup truck.

Jerinsky had automobile liability insurance provided by Liberty. Kika was employed by CEVA, and CEVA owned and self-insured the truck driven by Kika. CEVA does not maintain and is not required to maintain PIP coverage because the truck was a commercial vehicle. See Empire Fire & Marine Ins. Co. v. GSA Ins. Co., 354 N.J. Super. 415, 417 (App. Div. 2002) (“Commercial vehicles are not within the definition of ‘automobile’ as used in N.J.S.A. 39:6A-4 and, therefore, are not statutorily required to maintain PIP coverage.”). Following the accident, Jerinsky received medical treatment and applied to Liberty for PIP benefits. Liberty opened a PIP claims file and began paying Jerinsky’s medical providers. Jerinsky also applied for automobile property damage benefits. Liberty paid both types of benefits on behalf of Jerinsky.

*2 In August 2017, Liberty requested reimbursement from CEVA for the PIP benefits it had paid on behalf of Jerinsky. Liberty also informed CEVA that if it would not agree to provide reimbursement, Liberty demanded arbitration of its right to reimbursement of the PIP benefits. CEVA, through its third-party administrator, denied Liberty’s request and refused to arbitrate the issue, contending that Kika was not at fault for the accident.

In September 2017, Liberty and Jerinsky filed a complaint against CEVA and Kika. Liberty demanded reimbursement of the PIP benefits it had paid on behalf of Jerinsky. Liberty also demanded arbitration of its claim for reimbursement of the PIP benefits. In addition, Liberty and Jerinsky sought automobile property damages directly from defendants for the alleged total loss of Jerinsky’s vehicle.

CEVA and Kika filed an answer and CEVA admitted that it was self-insured. Liberty again requested CEVA to consent to arbitration, but CEVA continued to refuse to arbitrate Liberty’s PIP benefits claim. Liberty, therefore, filed a motion to compel CEVA to arbitrate the PIP benefit reimbursement claim citing N.J.S.A. 39:6A-9.1. CEVA opposed that motion, contending that its driver, Kika, was not a tortfeasor and the question of Kika’s fault for the accident should be decided in a court proceeding and not at arbitration.

After hearing oral arguments, the trial court denied Liberty’s motion. The court read its decision into the record on June 1, 2018, and supplemented those reasons in a written rider to its order. The court reasoned that Section 9.1 of the No-Fault Act used the term “tortfeasor,” but the statute did not define that term. The trial court went on to reason that before Liberty could compel arbitration of the amount of its reimbursement, there had to be a determination that CEVA’s insured was a tortfeasor. Consequently, the court held that the issue of Kika’s fault for the accident would be determined in a court proceeding, either by a judge or jury. Thereafter, if Kika was found to be a tortfeasor, the amount of reimbursement Liberty was entitled to receive would be determined at arbitration in accordance with N.J.S.A. 39:6A-9.1. Thus, in an order dated June 4, 2018, the trial court denied Liberty’s motion to compel CEVA to arbitration.

Liberty moved for reconsideration. The trial court again heard oral argument, but on July 20, 2018, denied reconsideration. The trial court again explained the reasons for its decision on the record.

II.
Liberty now appeals from the orders entered on June 4, 2018 and July 20, 2018, denying its motion to compel CEVA to arbitration. Liberty has a right to appeal those orders because Rule 2:2-3 allows appeals from orders granting or denying arbitration.

The central issue on this appeal is whether Section 9.1 of the No-Fault Act, N.J.S.A. 39:6A-9.1, compels arbitration of the question whether a party is a tortfeasor when that issue is disputed. That issue requires us to construe the statute and, therefore, is a question of law that we determine de novo. Kocanowski v. Twp. of Bridgewater, 237 N.J. 3, 9 (2019) (citing State v. Fuqua, 234 N.J. 583, 591 (2018)).

A.
To put this issue in context, we will briefly review the No-Fault Act and some of its relevant amendments. In 1972, the Legislature enacted the No-Fault Act to eliminate inefficient common-law subrogation litigation among insurers by “requiring automobile insurers to provide ‘primary coverage’ and ‘pay the medical expenses of [their] insured.’” Johnson v. Roselle EZ Quick LLC, 226 N.J. 370, 382-83 (2016) (alteration in original) (quoting State Farm Mut. Auto. Ins. Co. v. Licensed Beverage Ins. Exch., 146 N.J. 1, 6 (1996)).

*3 As originally enacted, the No-Fault Act provided that PIP insurers would be “subrogated to the rights of any party to whom [they] make[ ] [PIP] payments,” through “’inter-company arbitration or by inter-company agreement’ with the tortfeasor’s insurer.” Id. at 383 (alterations in original) (quoting L. 1972, c. 70, § 9). That subrogation provision, however, became “inoperative” two years after the effective date of the No-Fault Act. Ibid. (citing L. 1972, c. 70, § 9).

In 1981, our Supreme Court addressed the question whether, following the expiration of the No-Fault Act subrogation provision, an insurer had a common-law right to subrogation. Aetna Ins. Co. v. Gilchrist Bros., Inc., 85 N.J. 550, 561-62, 566-67 (1981). The Court held that insurers had such a subrogation right, but also held that the insurers could not seek reimbursement because of other provisions of the No-Fault Act. Id. at 566-67. In that regard, the Court pointed out that another section of the No-Fault Act stated that “[e]vidence of the amounts collectible or paid pursuant to [PIP coverage] is inadmissible in a civil action for recovery of damages for bodily injury by such injured person.” Id. at 562 (quoting N.J.S.A. 39:6A-12). Thus, the Court reasoned that the No-Fault Act had extinguished an insured person’s right to maintain an action for PIP payment and, as a result, the insurer had no right to reimbursement through subrogation. Ibid.

The Legislature responded in 1983 by enacting Section 9.1. N.J.S.A. 39:6A-9.1; L. 1983, c. 362, § 20. That provision allows automobile insurers to recover PIP benefits through reimbursement against certain tortfeasors. Thus, Section 9.1 created a right of reimbursement belonging to the insurer and not dependent on a right of subrogation. Johnson, 226 N.J. at 383-84 (citing State Farm, 146 N.J. at 9). In 2011, Section 9.1 was amended to make clear that an insurer’s reimbursement right was subject to any personal injury claim by the insured and that the reimbursement could be paid only after satisfaction of that personal injury claim. N.J.S.A. 39:6A-9.1; L. 2011, c. 11, § 1.

Currently, subsection (a) of Section 9.1 provides that an insurer that has paid PIP benefits as a result of an accident in New Jersey has a right to recover those benefits from any “tortfeasor” that is not required to maintain PIP protection or did not maintain PIP protection. Specifically, the statute states:
An insurer, health maintenance organization or governmental agency paying benefits pursuant to subsection a., b. or d. of [N.J.S.A. 39:6A-4.3], personal injury protection benefits in accordance with [N.J.S.A. 39:6A-4 or -10], medical expense benefits pursuant to [N.J.S.A. 39:6A-3.1] or benefits pursuant to [N.J.S.A. 39:6A-3.3], as a result of an accident occurring within this State, shall, within two years of the filing of the claim, have the right to recover the amount of payments from any tortfeasor who was not, at the time of the accident, required to maintain personal injury protection or medical expense benefits coverage, other than for pedestrians, under the laws of this State, including personal injury protection coverage required to be provided in accordance with [N.J.S.A. 17:28-1.4], or although required did not maintain personal injury protection or medical expense benefits coverage at the time of the accident.
[N.J.S.A. 39:6A-9.1(a).]

Subsection (b) of Section 9.1 goes on to state that if the tortfeasor is insured, the reimbursement is to be made by the insurer. N.J.S.A. 39:6A-9.1(b). This subsection also states that the determination of whether the insurer that paid PIP benefits is entitled to recover and the amount of the recovery shall be made by agreement of the parties, or if they cannot agree, in arbitration. In that regard, the statute states:
*4 In the case of an accident occurring in this State involving an insured tortfeasor, the determination as to whether an insurer, health maintenance organization or governmental agency is legally entitled to recover the amount of payments and the amount of recovery, including the costs of processing benefit claims and enforcing rights granted under this section, 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, health maintenance organization or governmental agency 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).]

In summary, Section 9.1 “creates a direct right of reimbursement, not a subrogation right.” Unsatisfied Claim & Judgment Fund Bd. v. N.J. Mfrs. Ins. Co. (UCJF), 138 N.J. 185, 191 (1994). The statute “allows PIP carriers to recover not from other PIP carriers but from non-PIP carriers and uninsureds.” Ibid. If there is a non-PIP carrier involved, the two insurers are either to agree on the reimbursement claim or, if they cannot agree, the dispute is to be resolved in arbitration. N.J.S.A. 39:6A-9.1(b). With this statutory overview, we turn to the issue in this case.

B.
CEVA is self-insured and, as the owner of a commercial vehicle, it was not required to carry PIP coverage. See Empire Fire, 354 N.J. Super. at 417 (first citing N.J.S.A. 39:6A-4; and then citing N.J.S.A. 39:6A-2(a)). As a self-insured entity without PIP coverage, CEVA is subject to N.J.S.A. 39:6A-9.1. Liberty Mut. Ins. Co. v. Thomson, 385 N.J. Super. 240, 243 (App. Div. 2006) (“Under the No-Fault Law, our courts have consistently held that ‘a self-insurer’s coverage obligations are co-extensive with the obligations of those possessing liability policies.’” (citation omitted) (quoting Ryder/P.I.E. Nationwide, Inc. v. Harbor Bay Corp., 119 N.J. 402, 410 (1990))).

Liberty argues that because CEVA’s status as a self-insured entity brings it within the ambit of N.J.S.A. 39:6A-9.1(b), CEVA is required to arbitrate the issue of whether Kika was negligent and, therefore, a “tortfeasor,” to determine whether Liberty is “legally entitled” to reimbursement of PIP benefits paid on behalf of Jerinsky. CEVA, in contrast, contends that Kika’s negligence is a legal issue to be determined in a court proceeding and that N.J.S.A. 39:6A-9.1(b) does not apply to it until Kika’s status as a “tortfeasor” is established. We agree with Liberty and reject the position of CEVA.

As noted earlier, the question presented is a question of statutory interpretation. Specifically, if there is a dispute concerning whether one of the drivers was at fault, did the Legislature intend that the dispute would be resolved in arbitration?

When construing a statute, our goal is “to discern and implement” the Legislature’s intent. State v. Smith, 197 N.J. 325, 332 (2009). The language of the statute provides “the best indicator of that intent.” DiProspero v. Penn, 183 N.J. 477, 492 (2005) (citing Frugis v. Bracigliano, 177 N.J. 250, 280 (2003)). “We ascribe to the statutory words their ordinary meaning and significance[.]” Ibid. (citing Lane v. Holderman, 23 N.J. 304, 313 (1957)). Furthermore, a court may not “rewrite a plainly-written” statute or “presume that the Legislature intended something other than that expressed by way of the plain language.” Ibid. (quoting O’Connell v. State, 171 N.J. 484, 488 (2002)).

The language of N.J.S.A. 39:6A-9.1(b) is clear on its face when it states that “the determination as to whether an insurer … is legally entitled to recover the amount of payments and the amount of the recovery” shall be by agreement, or, “upon failing to agree, by arbitration.” The plain meaning of the words “legally entitled to recover” includes disputes about whether the non-PIP insurer’s insured was a tortfeasor. Moreover, the phrase “the amount of payment” is a separate and additional concept from “legally entitled to recover,” thereby further clarifying that the first phrase refers to disputes over whether an insured is a tortfeasor.

*5 We also consider the legislative intent of the No-Fault Act in construing Section 9.1. See Haines v. Taft, 237 N.J. 271, 283-84 (2019). Interpreting Section 9.1 to include arbitration of factual disputes over whether an insured is a tortfeasor is consistent with and helps promote the goal of the No-Fault Act, which “is to avoid excessive litigation related to accidents and insurance[.]” UCJF, 138 N.J. at 205. “[T]he reimbursement right conferred by [S]ection 9.1 encompasses all tortfeasors that are not subject to the No-Fault law[,]” and was intended to alleviate the court system of reimbursement litigation by requiring claims to be arbitrated. State Farm, 146 N.J. at 14-15. See also Haines, 237 N.J. at 283-84, 290 (explaining that a major legislative intent of the No-Fault Act was to contain costs, and one way to reduce costs was to limit litigation in favor of arbitration).

CEVA and the trial court focused on the word “tortfeasor” and reasoned that the statute was inapplicable to CEVA until Kika is determined to be the “tortfeasor.” To accept that argument, the Law Division would first need to adjudicate the factual dispute whether Kika was negligent. That proceeding could well involve a protracted trial. Such an interpretation would undermine the statutory scheme by creating an extra and potentially lengthy step in what the Legislature intended to be an expeditious and efficient process.

Thus, the statutory provision has to be read in full context. Such a construction is also consistent with well-established case law. In 1996, our Supreme Court ruled that the phrase “any tortfeasor” in the No-Fault Act was intended to have “a broad meaning” encompassing “all tortfeasors that are not subject to the No-Fault law.” State Farm, 146 N.J. at 13-15.

CEVA relies on several cases for the proposition that a “purely legal” question of who is a tortfeasor should not be resolved through arbitration. See AAA Mid-Atlantic Ins. of N.J. v. Prudential Prop. & Cas. Ins. Co., 336 N.J. Super. 71 (App. Div. 2000); Coach USA, Inc. v. Allstate N.J. Ins. Co. 354 N.J. Super. 277 (App. Div. 2002); Hanover Ins. Co. v. Borough of Atl. Highlands, 310 N.J. Super. 568 (App. Div. 1998). Each of these cases is distinguishable from this case.

The cases cited by CEVA are based on the general principle that purely legal questions should generally be decided by a court. For example, in AAA Mid-Atlantic, we addressed the issue whether parents who served alcohol to their adult child, who subsequently was involved in a car accident, were “tortfeasors” under N.J.S.A. 39:6A-9.1. 336 N.J. Super. at 73. Noting that the case involved “a question of a statutory defense” under the social host liability statute, we held that a court, rather than arbitrators, should decide that purely legal question. Id. at 77.

Similarly, in Coach USA, we addressed the issue of whether insurers could seek automobile PIP reimbursement from insurers whose policies covered bus PIP payments only. 354 N.J. Super. at 278. We rejected the idea that the issue should be resolved in arbitration, declining to subject a decision of statutory interpretation to arbitration. Id. at 282. Instead, we held that the issue presented a purely legal question that should be decided by a court. Ibid.

Finally, the issue in Hanover Insurance Co. was whether a public entity tortfeasor must reimburse a PIP carrier pursuant to Section 9.1. 310 N.J. Super. at 570. After determining that the appeal presented a “single legal question” with “no material facts in dispute,” we held that public entity tort immunity applies to actions brought under Section 9.1. Id. at 570, 572.

Here, the question whether Kika was a tortfeasor does not present a purely legal question. Instead, it presents a factual issue. Accordingly, that issue is appropriate for arbitration. Again, the language of the statute itself includes the determination as to whether the insurer seeking PIP reimbursement “is legally entitled to recover.” N.J.S.A. 39:6A-9.1(b). Consequently, the statute calls for a determination of liability through agreement of the parties or arbitration.

*6 The orders denying Liberty’s motion to compel arbitration are reversed. The matter is remanded with the direction that the trial court enter an order compelling CEVA to arbitrate all issues related to Liberty’s request for reimbursement of PIP benefits.

Reversed and remanded. We do not retain jurisdiction.

All Citations
— A.3d —-, 2019 WL 2218939