07-14-11 OPEN MRI & IMAGING OF ROCHELLE PARK a/s/o CARMEN HERNANDEZ VS. MERCURY INSURANCE COMPANY
A-5760-09T2
Mercury Insurance Group denied Open MRI's assigned PIP claim for medical services on the ground that the insured's policy limits had been exhausted. Open MRI demanded arbitration pursuant to the Alternative Procedure for Dispute Resolution Act, seeking an award reforming Mercury's policy to permit payment. The arbitrator ruled that there was no legal basis for payment, and she lacked the power to reform Mercury's policy. An award in Mercury's favor was thus entered. Open MRI then instituted an action in the Law Division seeking an order summarily vacating the arbitrator's award and granting reformation. The judge granted the relief sought.
On appeal, we determined that the bar on appeals provided by N.J.S.A. 2A:23A-18b was inapplicable when the relief sought in arbitration (reformation) was beyond the power of the arbitrator to award, and the Law Division action was, in essence, a de novo proceeding as to which a right of review exists in order for us to carry out our supervisory powers. We also held that reformation was not available, and recognized that remedies available to a successful claimant for denial of PIP benefits were limited to interest and attorney's fees.
