Conflicting Unpublished Opinions Lead to a Published Decision

Badiali v. New Jersey Manufacturers Ins. Group., 429 N.J. Super. 121 (App. Div. 2012).  As Judge Fisher noted at the start of his opinion, the Appellate Division previously ruled, in a case involving these same parties (“Badiali I“), that New Jersey Manufacturers (“NJM”), an uninsured motorist insurer that was barred by its policy from rejecting an arbitration award of less than $15,000, could not reject an award of $29,148.62 when NJM was liable for only half of that award.  With that unpublished ruling in hand, plaintiff filed a new suit against NJM, seeking damages (mainly counsel fees incurred in pursuing Badiali I) on the grounds that NJM had acted in bad faith in the prior case.  NJM won summary judgment, and Badiali appealed.  The Appellate Division affirmed, holding that NJM’s position in Badiali I was “fairly debatable,” so that Badiali was not entitled to fees or other consequential damages.

NJM supported its contention that it had not acted in bad faith in Badiali I by relying on another unpublished Appellate Division decision, Geiger v. N.J. Manufacturers Ins. Co., Docket No. A-5135-02 (App. Div. Mar. 22, 2004).  Geiger and Badiali I had indeed reached opposite results.  Thus, Judge Fisher concluded, the existence of Geiger made NJM’s position “fairly debatable” and not in bad faith even though it did not appear that NJM cited Geiger in the course of litigating Badiali I.

Judge Fisher noted that, under Rule 1:36-3, unpublished decisions normally cannot be cited by a court.  He observed, however, that that Rule has exceptions, and that this case fell under a catchall exception contained in that Rule.  Judge Fisher closed by explaining the rationale for publishing this decision.  “Because, if we did not do more, the dueling unpublished opinions in Geiger and Badiali I would allow insurers to continue to reject arbitration awards that result in liability less than $15,000 in similar circumstances, we have deemed it appropriate to iterate our holding in Badiali I as part of our published disposition of this appeal.”  The two opposing unpublished opinions yielded a single published ruling.  Therefore, unless reversed by the Supreme Court, Badiali is the governing ruling on this issue, overtaking the contrary, but unpublished, rule of Geiger.