No specific phrasing is required for a litigant to reject an arbitration award and demand a trial in an uninsured-motorist case, a state appeals court said Wednesday in a precedential holding.

In fact, the party doesn’t even have to use the word "trial." The "fair implication" of the language used determines if the right to trial has been invoked, the Appellate Division held in Vega v. 21st Century Ins. Co., A-2904-11.

The judges overruled LoBianco v. Harleysville Ins. Co., 368 N.J. Super. 515 (Law Div. 2003), a published trial court decision that they said exalted form over substance by requiring a party to "demand a trial" in those very words.

In the present case, plaintiff Marleny Vega filed a UM claim against her carrier, 21st Century Ins. Co., alleging she was injured in a hit-and-run accident, and was awarded $87,500 in arbitration on June 16, 2011.

The policy gave either party the right to "demand the right to a trial on all issues," so long as they did so in writing within 30 days of the decision. On July 8, 2011, 21st Century’s attorney Joseph DiCicco wrote to Vega’s lawyer, Michael Coppola, saying "the UM Arbitration Award of June 16, 2011, is hereby rejected. Kindly be guided accordingly and contact the undersigned to discuss possible settlement of this matter."

Vega filed an order to show cause seeking to enforce the award on the ground that DiCicco’s letter did not "demand a trial" and thus the award had become binding.

Essex County Superior Court Judge Sebastian Lombardi agreed, finding the letter’s language did not satisfy the policy requirements.

Lombardi cited LoBianco, a nearly identical case in which the insured moved to confirm an arbitration award for $29,500 in UM benefits, contending that the carrier, Harleysville Ins. Co., did not strictly comply with the policy’s notice requirements. Three separate letters sent by Harleysville’s counsel in response to the award made no mention of trying the claim but said the carrier "hereby rejects the award of the arbitration panel. Kindly take any steps necessary to pursue a claim on behalf of your client."

Mercer County Superior Court Judge Mitchel Ostrer confirmed the award in LoBianco, pointing out that the policy clearly stated a trial must be demanded within a certain period of time, and as "an unambiguous adhesion contract" it had to be "strictly enforced against the drafter."

In Vega’s case, Appellate Division Judges Clarkson Fisher Jr., Alexander Waugh Jr. and Jerome St. John said 21st Century’s rejection of the award and invitation to discuss settlement could only be interpreted as a demand for trial because there was nothing to discuss otherwise. "Vega could not have reasonably understood the letter to mean anything else," Fisher wrote for the panel.

He rejected the "formalism" of Lombardi’s and Ostrer’s holdings that "failure to talismanically express a demand for a trial was fatal and, therefore, the award remained binding."

Fisher said "we cannot agree there is only one way to trigger the policy language and nullify an arbitration award."

The panel instead followed the holding in Morag v. Continental Ins. Co. of New Jersey, 375 N.J. Super. 56 (App. Div. 2005), where the letter from the carrier’s lawyer did not specifically demand a trial but the carrier was found entitled to one anyway based on the reasonable expectations of the insured.

Morag differed in that the carrier’s lawyer there asked the insured’s lawyer to let the carrier know when a complaint was filed and indicated a willingness to accept service. Fisher nevertheless adopted its "fair implication" approach and agreed with its cautionary language about the need for letters rejecting arbitration awards to be clearly written. He saw that as good advice, noting "a party who fails to expressly demand a trial runs the risk that the demand will be found ambiguous."

DiCicco, who is staff counsel for 21st Century in Edison, referred a request for comment to Edward Hoagland Jr., the managing attorney of the Edison office where he works. Hoagland did not return a call. Nor did Coppola, a Kearny solo.

Dennis Brotman of Fox Rothschild in Princeton, the lawyer for Philip LoBianco, says "the language of insurance contracts used to be strictly construed against insurance companies" and he calls Fisher’s decision part of a pattern of appellate rulings that "makes the playing field for injured people and consumers more difficult in auto insurance cases."