Insurers must conduct trial to determine priority in PIP dispute
Farm Bureau was assigned the duty to pay PIP benefits to Oussama Char after he was hurt in a vehicle collision. Char was the son of the owner of Nour, Inc., the registered owner of the vehicle Char was driving. Nour, Inc. had insured the vehicle with Progressive, but canceled the coverage on the involved vehicle days before the collision. Char had enjoyed access to the vehicle for months prior to cancellation. Char sued Farm Bureau to force it to pay PIP benefits, and ultimately the parties concluded a compromise settlement. Farm Bureau then sued Progressive for reimbursement.Progressive raised several arguments to avoid re-paying Char's PIP expenses to Farm Bureau. The Court noted that under the assignment process, assigned insurers are not limited to the normal "one year back," so the suit was not late. It also held that Farm Bureau was not obligated to join Progressive in the original suit.
Since Progressive was not in privity with the Chars in pursuing the original PIP action, however, the Court noted that Progressive was not bound by the outcome determining that Char was not an uninsured "owner" of the car. Therefore, the case was returned to the lower court to assess whether Char was one of the owners of the uninsured vehicle if he had enjoyed unfettered possession for more than 30 days. If Char is deemed an owner under the Motor Vehicle Act, no PIP benefits would be payable, and Farm Bureau would not be entitled to reimbursement.