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Woods v. Commercial Union Insurance Companies

8/28/2001

Suffolk.


December 19, 2000.


Insurance, Motor vehicle insurance, Underinsured motorist, Arbitration. Arbitration, Insurance, Parties.


Civil action commenced in the Superior Court Department on January 20, 1998.


The case was heard by John C. Cratsley, J., on motions for summary judgment.


The plaintiff brought this action against Commercial Union Insurance Companies (C.U.) pursuant to G. L. c. 251, ? 11, to confirm an arbitration award. Acting on cross motions for summary judgment, a Superior Court judge allowed that of the plaintiff. In its appeal, C.U. repeats the claim it made below, that it was not a party to the arbitration proceeding. We agree with that contention and reverse the judgment.


Background.


While operating a mail truck on July 9, 1996, in Wilmington, the plaintiff was involved in a collision with a vehicle operated by Nathan Balestrieri, and insured by the Commonwealth Mutual Insurance Company (Commonwealth) for up to $20,000 for bodily injury liability to a single individual. At the time, the plaintiff had the benefit of underinsurance coverage of $50,000 under his mother's policy with the defendant, C.U. The plaintiff and Commonwealth agreed to arbitrate the plaintiff's bodily injury claim against Balestrieri. Sometime prior to September 2, 1997, that claim was submitted to National Arbitration & Mediation (NAM) for arbitration. Under NAM's procedural rules, parties who agree to arbitration "initiate a case by submitting a jointly-executed submission form to NAM or by requesting NAM to invite another party to join in a submission to arbitration . . . ." The form submitted to NAM designated Michael Woods as "plaintiff" and Nathan Balestrieri as "defendant," and indicated that both liability and damages were at issue. A representative of Commonwealth is listed as the contact person for Balestrieri. No mention of C.U. is contained in the submission form, nor is there any indication in the record that C.U. was aware of the arbitration proceeding before September of 1997.


By letter dated September 2, 1997, plaintiff's counsel informed C.U. that it was "being notified of the pending arbitration so as to be an included party in the same." The letter also identified the plaintiff's mother as C.U.'s insured and stated that "damages will exceed the applicable policy limits" under Commonwealth's bodily injury policy. By letter dated September 10, 1997, an adjuster from C.U. requested information concerning the accident, copies of medical records and bills, and a statement of lost wages. Records and bills relating to the plaintiff's medical treatment were forwarded to C.U. by plaintiff's counsel on October 10, 1997.


On or about October 7, 1997, NAM's regional manager telephoned the C.U. adjuster to request that C.U. participate in the arbitration. Because the adjuster refused, NAM did not send a submission form to C.U. and did not bill it an arbitration fee. NAM had previously received an arbitration fee from the plaintiff and from Commonwealth on behalf of Nathan Balestrieri. On November 17, 1997, the adjuster informed plaintiff's counsel that C.U. would not be attending the arbitration scheduled for November 24, 1997. At about that time plaintiff's counsel notified C.U. that it would be "contractually bound by the decision of the arbitrator as to any award in excess of the BI [bodily injury] policy, and that this office will seek to enforce said award even if Commercial Union should choose not to attend the arbitration."


By fax dated November 24, 1997, C.U. informed plaintiff's counsel it was still investigating whether or not it had been prejudiced by late notice of th

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