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Greenberg v. Great American Insurance Co.

Decided: March 22, 1978.

RUBIN GREENBERG, PLAINTIFF-APPELLANT,
v.
GREAT AMERICAN INSURANCE COMPANY, DEFENDANT-RESPONDENT



On appeal from Superior Court, Law Division, Bergen County, whose opinion is reported in 146 N.J. Super 69.

Allcorn, Morgan and Horn. The opinion of the court was delivered by Morgan, J.A.D. Horn, J.A.D. (dissenting).

Morgan

In this appeal we confront problems raised by the application of the income continuation provision of the New Jersey Automobile Reparation Reform Act, N.J.S.A. 39:6A-4(b), to an alleged loss of income suffered by a commissioned salesman as a result of injuries sustained in an automobile accident. The stipulated facts upon which the trial judge ruled were that during specified periods after plaintiff's accident his cash income increased over what it had been before the accident. Accordingly, the trial judge ruled that plaintiff suffered no income loss during those periods and entered judgment for the insurance carrier from which plaintiff appeals. 146 N.J. Super. 69 (Law Div. 1976).

The uncontroverted facts, included in the parties' stipulation which formed the basis for the challenged ruling, disclose

that on March 23, 1973 plaintiff sustained injuries in an automobile accident which resulted in various periods of total or partial liability to work at his usual occupation, that of a manufacturer's representative selling toys on a commission basis. He was, at the time, the holder of an automobile liability policy issued by Great American Insurance Company, defendant herein, which provided him coverage, on a first party basis, not only for minimum "income continuation benefits" in accordance with N.J.S.A. 39:6A-4, but also extended benefits under N.J.S.A. 39:6A-10. He was, therefore, afforded coverage for maximum benefits in the amount of $5,200 (N.J.S.A. 39:6A-4) and $36,400 (N.J.S.A. 39:6A-10), respectively, by way of indemnification for lost income sustained from the accident-related physical disability.

The nature of plaintiff's work is such that part can be performed at home, such as telephone communications with accounts and the mailing of catalogs. The "field work" component of his job involves personal visits to prospective purchasers to provide exhibits and establish personal rapport. Furthermore, some income consists of delayed payments of commissions based upon previous sales by way of reorder and so-called "residuals." Hence, even during periods in which plaintiff is totally unable to work, that is, even when he is unable to work on the telephone and by mail, he nevertheless receives some income by way of these commissions derived from earlier work.

The parties stipulated that plaintiff was totally disabled from this accident between March 23, 1973 and September 20, 1973. During that period he received the full amount to which he deemed himself entitled, $400 a week.

He was partially disabled from September 20, 1973 until June 12, 1974 to the extent that he was able to work three days out of the week, or at 60% of capacity. During a portion of that period, from September 21, 1973 to December 14, 1973, he received from defendant 40% of the maximum available, or $160 a week. During the remainder thereof he received nothing.

From June 12, 1974 until January 7, 1975 he was again disabled by reason of surgery required by his injuries received in the accident. Between June 6, 1974 and September 20, 1974, a portion of the foregoing period, he was paid at the maximum, $400 a week, and nothing for the remainder of that period of total disability. Hence, for a portion of the period in which the parties admit plaintiff was totally disabled from working, he was paid nothing by way of income continuation benefits.

On January 8, 1975 plaintiff resumed his occupation "on the same 60% basis as theretofore, and that partial disability is expected to continue for a prolonged period of time." He has, however, been receiving nothing for lost income since the date of his last payment in September 1974.

On January 13, 1975 defendant advised plaintiff that because plaintiff's income had increased from 1972 through 1974, he was deemed ineligible for further income continuation benefits. Defendant's position was and is that since plaintiff had not demonstrated a diminution of income, the mere fact that he was unable to work, either partially or totally, as a result of his injuries, did not entitle him to any income continuation benefits. Plaintiff, thereupon, instituted the present declaratory judgment suit which he lost, at the trial level, when the trial judge in substance adopted defendant's position.

We must frankly express our regret at the poverty of facts surrounding the issue upon which we are called to rule. Only the barely essential facts were stipulated. Questions arising from those facts not mentioned must, therefore, go unanswered. For example, it would help to know whether plaintiff's estimate that he is now working at 60% of capacity includes field work or whether that estimate is based upon the relationship between the normal amount of home work and field work. The stipulation does not say. It would have been helpful had we known of the extent of plaintiff's gain in income during the 1972-1974 period and from what source or sources his income was derived during that period.

As the matter now stands, we can only speculate as to whether that income came from residuals and reorders, or from field work, or work at home or from some other source, unconnected with his work, or some form of earnings on capital.

The issue presented here is a novel one and arises under relatively new legislation. We have stressed before the desirability of a comprehensive factual development as a basis for considering new issues with substantial, and perhaps unforeseen, ramifications. The case should have been tried and should not have been decided under such a sparse factual stipulation. Nonetheless, the issue is here, the trial court opinion has been published, and rather than remand the matter for trial, we will consider the issue in its present form, and leave what other problems may develop from a more searching factual investigation to some other day.

The statutory foundation for plaintiff's claim, N.J.S.A. 39:6A-4(b), reads as follows:

b. Income continuation benefits. The payment of the loss of income of an income producer as a result of bodily injury disability, subject to a maximum weekly payment of $100.00 per week. Such sums shall be payable during the life of the injured person and shall be subject to an amount or limit of $5,200.00 on account of injury to any one person, in any one accident.

"Income" is defined to include "salary, wages, tips, commissions, fees and other earnings derived from work or employment." N.J.S.A. 39:6A-2. Benefits are therefore provided for loss of commissions resulting from a covered event.

The precise issue posed for resolution is whether, under the stipulated facts, plaintiff has, or may have, lost income despite the fact that his cash receipts during his period of disability, partial and total, exceed those he was receiving before the accident. The trial judge answered this question in the negative, finding that plaintiff's increased income while disabled repelled the notion that he had lost income during that period; although disabled in fact, the disability

had no effect on income production. We disagree with this conclusion to the extent that it purports to state a principle of substantive law that where cash receipts after a disabling accident equal or exceed those received before the accident, the victim has suffered no income loss within the meaning of N.J.S.A. 39:6A-4(b). Viewed as a question of fact, such a conclusion ...


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