USA – NEW JERSEY Trends and Developments Contributed by: William (Bill) Wilson and Craig R. Rygiel, Mound Cotton Wollan & Greengrass
or that [the RPG] had a financial stake in the underly- ing litigation” (id at *4). In affirming the trial court’s finding that the RPG had standing, the Appellate Division explained that “New Jersey law does not recognize any distinction between the concepts of standing and real party in interest” (id). Under New Jersey’s real party in interest rule, “a ‘real party in interest’ includes ‘a party with whom or in whose name a contract has been made for the benefit of another [and that party] may sue in the fiduciary’s own name without joining the person for whose benefit the suit is brought” (id) (quoting N.J. Ct. R. 4:26-1). While recognising “[t]here is little caselaw in New Jer- sey addressing the relationship between an RPG and its members for purposes of establishing standing”, the court found that the RPG was a real party in inter- est under the particular facts presented and therefore had standing to sue Lexington on behalf of Stoney Run (id at *6). Specifically, the court reasoned that the RSG was a real party in interest because “Bleznak is a member of the RPG, and Bleznak is an agent on behalf of its affiliate, Stoney Run” (id). New Jersey Federal Courts Enforce Arbitration Clauses Another recent trend involves insureds and insurers alike seeking to resolve their disputes through arbitra- tion rather than litigation. New Jersey courts in 2025 have had several occasions to address the enforce- ability of arbitration provisions in insurance policies in a variety of contexts. In County of Middlesex, New Jersey v Underwriters at Lloyds, London , No 25-1390, 2025 WL 2645706 (D.N.J. Sept. 15, 2025), the district court applied the Federal Arbitration Act to compel arbitration pursuant to an arbitration clause that permitted either party to demand arbitration when they were “unable to agree as to… the actual amount of indemnity to be paid” (id at *4). Applying state-law principles to determine that a valid agreement to arbitrate existed, the district court found that the arbitration clause was clear and unambiguous for several reasons: “(1) the clause is clearly written
at the top of the ‘General Policy Conditions’ section; (2) the language warns the reader that there are addi- tional terms and conditions of the agreement to arbi- trate, including how the arbitrators will be selected, how the arbitrators and/or umpire will calculate the indemnity due, and the fact the arbitration decision will be binding; (3) the language notifies the reader which matters shall be arbitrated, including disputes regarding indemnity payments; and (4) the greater Policy demonstrates how other provisions interact with the arbitration clause” (id at *4). The trial court then found that the parties dispute over reimbursement of defence and indemnity payments fell within the scope of that agreement. In so holding, the trial court reiterated that under the Federal Arbitra- tion Act “there is a presumption of arbitrability” (id). The trial court was not persuaded by the insured’s argument that the arbitration clause was limited to first-party claims and did not apply to third-party claims, reasoning that the clause applied to all indem- nity disputes because “[t]here is no language in the clause which articulates that specific types of claims for indemnity are exempt from the clause” (id at *5). Similarly, in Houston Casualty Co. v Kinsale Insurance Co. , No 24-7866, 2025 WL 2779139 (D.N.J. Sept. 30, 2025), the trial court applied the doctrine of equitable estoppel to compel arbitration. There, the coverage dispute arose out of a workplace accident on a con- struction site. Kinsale issued general liability coverage to the subcontractor of the injured worker while HCC issued coverage to the general contractor. After Kinsale refused to accept the tender of cover- age on behalf of, among others, the general contrac- tor, HCC sued Kinsale for a declaration regarding its coverage obligations. Kinsale then sought to compel arbitration, “arguing that HCC should be bound to the Kinsale Policy’s arbitration clause under a theory of equitable estoppel” (id at *3). In response, HCC argued equitable estoppel was inapplicable because “it brought suit under its independent equitable right of contribution, not as a subrogree”, and was “seeking indirect, rather than direct, benefits under the Kinsale Policy” (id) (cleaned up).
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