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Legal Memorandum: Motion to Compel Arbitration

Issue: Will the court grant a motion to compel arbitration in a case involving uninsured motorist coverage?

Area of Law: Alternative Dispute Resolution, Insurance Law, Litigation & Procedure
Keywords: Motion to compel arbitration; Uninsured motorist coverage
Jurisdiction: Federal, New Jersey
Cited Cases: None
Cited Statutes: None
Date: 02/01/2009

Recently, the New Jersey Superior Court, Appellate Division had occasion to review the endorsement language in an uninsured motorist policy that contained an arbitration clause.  Moricin v. N.J.  Mfrs. Ins. Ass’n, No. A-4080-07T3, 2009 WL 290600 (N.J. Super. Ct. App. Div. Feb. 9, 2009).  In reversing a trial court order which had compelled arbitration of an uninsured motorist claim, the Appellate Division stated that generally, “[c]overage under an insurance policy is a legal issue to be resolved by a court, not an arbitrator.  Id. at *1 (emphasis added).  Moreover, the court added, “coverage issues are not generally arbitrable in UM policies.”  Id.  In the case before it, this was particularly clear and the trial court erred in referring the coverage dispute to arbitration because “[t]he policy here is clear and unambiguous: ‘disputes concerning coverage under this Part may not be arbitrated.'”  Id.  The court concluded:

Accordingly, we reverse the order of March 14, 2008 directing the parties to arbitration and remand the matter to the trial court for discovery and ultimate determination on the question of whether the Georgia vehicle was insured at the time of the accident.  Thereafter, the trial court shall make a determination as to whether there is coverage under the policy.

Id. at *2.

The result in Moricin was compelled by the literal language of the UM endorsement at issue as well as long-standing New Jersey authority construing similar provisions.  Underlying that authority is the following notion:

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