The text of the Automobile Property Subrogation Arbitration Agreement follows. It is Copyright 2013 and effective May 2, 2005 by Arbitrations Forums, Inc. and reproduced with permission.

 

Automobile Subrogation Arbitration Agreement

 

By signing this Agreement, the company accepts and binds itself to the following:

 

Article First – Compulsory Provisions

 

Signatory companies must forego litigation and arbitrate any personal or commercial automobile damage subrogation or self insured automobile damage claims through Arbitration Forums, Inc. (herein after referred to as AF).

 

Article Second – Exclusions

 

No company shall be required, without its written consent, to arbitrate any claim or suit if:

a) It is not a signatory company nor has given written consent; or

b) Such claim or suit creates any cause of action or liabilities that do not currently exist in law or equity; or

c) Its policy is written on a retrospective or experience-rated basis; or

d) Any payment which such signatory company may be required to make under this Agreement is or may be in excess of its policy limits. However, an Applicant may agree to accept an award not to exceed policy limits and waive their right to pursue the balance directly against the Respondents insured; or

e) It has asserted a denial of coverage; or

f) Any claim, which a lawsuit was instituted prior to, and is pending, at the time the Agreement is signed; or

g) Under the insurance policy, settlement can be made only with the insured's consent

Article Third – Decisions

 

The decision of the arbitrator(s):

a) Shall be based on local jurisdictional law consistent with accepted claim practices.

b) Is final and binding without the right of rehearing or appeal. However, this does not preclude AF from correcting a clerical or jurisdictional error of an arbitrator(s) or AF staff.

c) Is neither res judicata nor collateral estoppel to any other claim or suit arising out of the same accident, occurrence, or event except where an Applicant seeks recovery of supplemental damages as allowed under the Awards section of the rules. The decision is conclusive only of the issues in the matter submitted to the arbitrator(s) and only as to the parties to the arbitration. The admissibility of the decision in any other proceeding is not intended, nor should be inferred from this Agreement.

All matters concerning an arbitration proceeding shall be held in strict confidence.

Article Fourth – Non-Compulsory Provisions

 

The parties may, with written consent, submit a claim:

a) That exceeds this forums monetary limit, or

b) Where a non-signatory wants to participate.

Once a company gives written consent, all Articles and Rules of this forum are applicable, and the company may not revoke its consent.

Article Fifth – AF's Function and Authority

 

AF, representing the signatory companies, is authorized to:

a) Make appropriate Rules and Regulations for the presentation and determination of controversies under this Agreement;

b) Determine the location, and the means by which arbitration cases are heard;

c) Determine qualification criteria and provide for the selection and appointment of arbitrators;

d) Establish fees;

e) Invite other insurance carriers, non-insurers, and/or self-insureds to participate in this arbitration program, and compel the withdrawal of any signatory for failure to conform to the Agreement or the Rules issued thereunder.

The signatories, directors, officers, staff, agents, and AF employees, as well as the arbitrators, are not liable to and will be held harmless by any party(ies) for any negligence, act, or omission concerning the processing, administration, or hearing of any arbitration conducted under this Agreement.

Article Sixth – Withdrawals

 

Any signatory company may withdraw from this Agreement by notice in writing to AF. Such withdrawal will become effective sixty (60) days after receipt of such notice except as to cases then pending before arbitration panels. The effective date of withdrawal as to such pending cases shall be upon final compliance with the finding of the arbitration panel on those cases.

Automobile Arbitration Rules and Regulations – Preamble

 

Rules and regulations were created under authority of Article Fifth (a) of the Automobile Subrogation Arbitration Agreement.

As a condition precedent to using the AF rules and regulations, parties should attempt to settle the dispute prior to filing arbitration. The filing company must list the correct and current representative's name and address, the name and address of the insured and the claim file number for the adverse parties. Failure to do so may cause the decision to be voided.

 

Section One – Jurisdiction

 

 

1.The jurisdiction is limited to the United States, Puerto Rico and the U.S. Virgin Islands.

 

2. If a matter that should have been referred for arbitration is placed in litigation:

 

(a)The filing party must dismiss the suit upon notification.

 

(b)The applicant must file arbitration within 60 days of the date of the suit's dismissal.

 

(c)For cases filed after the 60 day timeframe, the expiration of the statute of limitations is a valid affirmative defense.

 

3.Compulsory arbitration is applicable to a maximum of $100,000 per claim:

 

(a)A claim and a counterclaim are considered two separate claims.

 

(b)A claim and a companion claim for different lines of coverage are considered separate claims.

 

(c)Legal fees are not a part of this program unless the policy limit includes legal fees.

 

(d)The deductible is not a part of the monetary limit.

 

4.A respondent may argue the negligence of a non-signatory, but must implead any additional signatories by filing an amended A-form with AF and the other companies in compliance with procedural rules 2 and 3. The respondent must provide the impleaded party with a copy of the applicant's contentions.

 

(a)The arbitrators will apportion liability and award damages if any.

 

(b)Non-signatories may be impleaded only if they give written consent per Article Fourth.

 

(c)When the negligence of a non-member is argued, the applicant may withdraw its application prior to the hearing to pursue recovery by other means or proceed with arbitration by agreeing to accept an award against a participating company and waive the right to pursue the balance directly against the non-member.

 

5.When filed as a companion to special and or personal injury protection, the special and PIP rules regarding arbitrators will prevail.

 

Section Two – Procedure

 

1.Legal Fees. Signatories must identify themselves as signatories to the Automobile Arbitration Agreement and inform all interested parties at the time a claim is made. If a signatory inadvertently enters litigation against another signatory, it must withdraw from that litigation within 30 days of notice. Failure to do so subjects the responsible signatory to payment of the other party's reasonable court costs and attorney fees expended to cause removal from litigation. These fees may be included in the Legal Fees section of the A-Form.

 

2.Applicant. The applicant commences an arbitration proceeding by filing a completed A-Form and Contentions Sheet with AF and each involved party. Any amendments must be received by all parties by close of business prior to 10 business days before the hearing. The applicant must submit all other documents to AF by the close of business prior to 10 business days before the hearing date. Documents not received within this time frame will not be sent to the hearing.

 

3.Respondent. The respondent answers by filing its copy of the A-Form and Contentions Sheet, including any amendments with AF and all other interested parties by the close of business prior to 10 business days before the hearing date. If a Counterclaim is being made, the respondent must check the box on the A-Form, clearly showing that a counterclaim is being made. Unless a Counterclaim is filed and heard with the original arbitration case, the respondent is precluded from pursuing its counterclaim, unless it can show through documentary evidence that its claim was created by payment to its insured less than 10 business days prior to the hearing date. Filing a Counterclaim is the only way a respondent may collect damages. Respondent documents not received by AF by close of business prior to 10 business days before the hearing date will not be sent to the hearing. Personal representation will not be allowed in cases where an answer has not been filed as outlined above. If one of the parties questions compliance, the burden of proof is upon that party.

 

4.Legal Fees. A company seeking legal fees must list these amounts on the A-Form.

 

5.Affirmative Defenses. Parties must raise and support affirmative pleadings or defenses in the Affirmative Defenses/Pleadings section of the Contentions Sheet. If a denial of coverage is being plead, a copy of the denial letter to the insured must be provided.

 

6.Itemization of Damages. In order to contest damages, parties must present arguments on the Contentions sheet and provide its damages amounts under the Itemization of Damages section. If this section is blank, damages are not at issue.

 

7.Companion Claims. All companion claims will be heard together if filed with the original Automobile Arbitration filing or with the related docket number listed on the A-Form.

 

8.Applicant. The applicant must immediately notify AF if it has resolved the disputed issues before the hearing. AF will withdraw the case upon notification.

 

9.Respondent. If the respondent raises an objection to jurisdiction as a proper affirmative defense against compulsory arbitration and the panel or AF withdraws, the applicable AF office will remove the case from its active docket. If after removal, it is discovered that the case was properly placed in arbitration and the applicant refiles the case, the respondent company must reimburse the applicant for all reasonable legal expenses and court costs resulting from the improper objection to jurisdiction. AF will charge a reinstatement fee.

 

10.Reschedule. If requested at least 3 business days prior to the hearing, each party may be granted one reschedule of the hearing date so long as procedural rules 2 and 3 have been complied with. AF will notify all parties of the new hearing date and charge the requesting party a fee.

 

11.Deferment. Any party may request a deferment on the A-Form. Justification for the deferment must be included in the Deferment section of the Contention Sheet. AF will charge the requesting party a deferment fee. If a deferment is requested, the case will proceed on the scheduled hearing date to determine the validity of the request. If upheld, the case will be deferred for one year. If denied, the arbitrator will continue to hear the disputed issues. The party granted the deferment may withdraw the deferment and the case will proceed to the next available hearing. Any subsequent requests must follow the above procedure.

 

12.Inspection of Defective Products. For products liability cases, reasonable accommodations should be made for the inspection of the alleged defective products. Failure to do so may result in case withdrawal if raised as critical to defense of the claim.

Section Three – Hearings

 

1.AF will transmit or mail hearing notices to all parties at least 30 days prior to the initial hearing date.

 

2. The arbitrators will hear the case even if the respondent fails to answer.

 

3AF will assign arbitrators as follows: under $7,500 – one arbitrator. $7,500 and above – 1 arbitrator unless 3 are requested on A-form. Any party requesting a 3 person panel will be charged a 3 person panel fee.

 

4.Arbitrators may grant an adjournment for cause or to request briefs or clarification of submitted materials. In such case, AF will notify all parties of the new hearing date. If requested documents are not received prior to the adjourned hearing date, the hearing will proceed.

 

5.The arbitrators will only consider:

 

(a)Affirmative defenses or objections included in the Affirmative Defense/Pleading section of the Contentions Sheet

 

(b)Deferment requests included in the Deferment Justification section of the Contentions Sheet

 

(c)Evidence listed in the Contentions Sheet

 

(d)Amount entered as the Company Claim Amount and/or Legal Fees on the A-Form

 

(e)Contested damages if specifically plead on the Itemization of Damage section of the Contentions Sheet.

 

6.Procedure at arbitration hearings is informal. Formal rules of evidence do not apply.

 

7.Witnesses may be presented. The party must indicate the intent to do so on the original or amended A-Form. Insureds or witnesses may not appear without the presence of a company representative. Personal appearances are for the purpose of ensuring the arbitrators understanding of the evidence presented and are not subject to cross examination. Representatives may not be present while the panel is deliberating.

 

8.No person may serve as an arbitrator over any matter in which he or she personally or his or her company has any direct or indirect interest.

 

9.If the respondent fails to deny coverage before the hearing, the respondent may do so in writing to AF, up to 60 days from the publication of the decision if:

 

(a)Applicant made its filing at least 120 days before the Statute of Limitations expires; and

 

(b)Respondent pleads its defense at least 60 days before the Statute of Limitations expires; and

 

(c)No prior response has been filed.

 

Upon notifying AF of the coverage denial following the hearing, the respondent will be assessed a charge equal to the filing fee.

Section Four – Decisions

 

1.Arbitration decisions must be based on the evidence submitted. Panels may not render default judgments.

 

2.As required by Article Third, notice of clerical or jurisdictional error must be provided by arbitrating companies to AF within 30 days after the decisions publication date. AF reserves the right to correct errors without notice within 30 days after publication of the decision.

 

3.AF will transmit or mail the decision to all interested parties.

Section Five – Awards

 

1.The parties are required to honor all awards within 30 days of the decision's publication date.

 

2.When a party does not honor an award within 30 days after the publication date:

 

(a)The prevailing company's local representative must immediately send a written request for payment to the adverse company's local senior representative. This person must be addressed by name.

 

(b)If still unpaid after 30 days after the written request for payment, the company should send written request to AF for assistance with the payment award.

 

(c)AF will notify the non-paying company and charge a fee.

 

(d)If the award remains unpaid for an additional 30 days, the company may seek legal recourse in pursuit of collection. The prevailing company will be entitled to statutory interest and all costs incurred in pursuing collection until the award is paid.

 

3.Payments made as a result of the award are to be made only to the applicant and will include any deductible interest in the interest of good will between the companies. An applicant can file for supplemental damages if they are paid within 10 days of the original hearing or anytime thereafter. The original liability decision is res judicata. The sole issue is the filing of supplemental damages.

Section Six – Administration

 

1.The applicant incurs a filing fee payable to AF. A counterclaiming respondent must also pay the prescribed fees.

 

2.Photographs will be returned if requested. Request must include a self addressed return envelope. All other material will be destroyed following the hearing.