Court sanctions Citizens Insurance for frivolous claim; affirms its duty to pay PIP benefits
Citizens Insurance wrote coverage on a semi tractor that an injured man, Abdullah Hamdi, was driving when he suffered motor vehicle accident injuries. Citizens rejected his claim for PIP benefits. He then sued Citizens and National Casualty Company, the insurer of the trailer Hamdi was pulling, seeking payment of his medical and three years' wages. The trial judge listened to Citizens' argument and then ruled that while it may have a contract claim against the tractor owner-lessor for failing to purchase No Fault Coverage, as the insurer of the lessee-owner, Citizens owed PIP benefits.
Citizens then filed a lawsuit against the involved trucking company and National. The second court dismissed the lawsuit and found that it was frivolous since Citizens was clearly first priority under the No Fault Act, and its claims against National-the insurer of the trailer--had alrady been rejected in a prior lawsuit. Citizens appealed this decision and the lower court was affirmed. The higher court judges also upheld the ruling awarding sanctions for a frivolous claim.