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Lind v. Insurance Co.

Decided: May 1, 1980.


Gibson, J.s.c.


This is an action for personal injury protection (PIP) benefits. Cross-motions for summary judgment have been filed which call into question the effect of N.J.S.A. 39:6A-13.1(a), the limitations provision of the New Jersey "No-Fault Law" (Automobile Reparation Reform Act), N.J.S.A. 39:6A-1 et seq. The material facts are not in dispute and the matter is ripe for disposition by the court. R. 4:46-2.

On October 12, 1974 the minor plaintiff, Edward O. Lind, III, was struck while walking across a street in Margate, N.J. He sustained a blow-out fracture of the facial bones surrounding his right eye and came under the care of Dr. R. S. Slacum. At that time his father, also a plaintiff here, was the owner of an automobile which was insured through defendant Insurance Company of North America. Included in the policy were compulsory PIP benefits of which the minor plaintiff was a beneficiary. Following notice of the accident and the resultant injuries, defendant paid all related medical bills up to February 25,

1975. Although it was anticipated at the time that future surgery would be needed, Dr. Slacum recommended that it be deferred because of the age of the child (seven). Active treatment was therefore discontinued until October 1978, when follow-up exams were conducted. The bills were submitted to the carrier but on November 30, 1978 payment was refused based on the lapse of more than two years since the last treatment. The within suit was instituted two months later.

The primary question raised by these facts is whether N.J.S.A. 39:6A-13.1(a) should be read to bar a claim for medical benefits when the injury which forms the basis of the claim is one which necessarily involves a gap in treatment and when that gap brings the expense involved outside the four-year period from the date of the accident and more than two years from the last payment of benefits. Secondly, is the answer to the above question any different when the claimant is a minor? It should be noted that defendant admits that the expenses are causally connected to the accident and also that it was on notice of the need for future treatment during the period of voluntary payment.*fn1 There are no reported cases which resolve these issues.

N.J.S.A. 39:6A-13.1(a) reads as follows:

Every action for the payment of benefits set forth in sections 4 and 10 of this act, except an action by a decedent's estate, shall be commenced not later than 2 years after the injured person or survivor suffers a loss or incurs an expense and either knows or in the exercise of reasonable diligence should know that the loss or expense was caused by the accident, or not later than 4 years after the accident whichever is earlier, provided, however, that if benefits have been paid before then an action for further benefits may be commenced not later than 2 years after the last payment of benefits.

Although the within action was instituted within two years of the incurring of the expense, it was clearly outside the four-year period and more than two years from the last payment. In Andrito v. Allstate Ins. Co. , 161 N.J. Super. 409 (Cty.D.Ct.1978), it was held that an expense which was incurred more than two

years from the last voluntary payment was not barred so long as it came within four years of the accident. Here, of course, the expense was beyond that four-year period. In dictum, the court also noted that the final clause of N.J.S.A. 39:6A-13.1(a) provided an exception to the four-year limitation and authorized claims for benefits beyond that period "as long as the suit is brought within two years of the last payment." Id. at 414. The same result was reached in the recently decided Appellate Division decision of Bell v. Western Employer's Ins. Co. , 173 N.J. Super. 60 (App.Div.1980).

The only other reported cases to date dealing with this portion of the No Fault Act are Henze v. Motor Club of America , 162 N.J. Super. 521 (Cty.D.Ct.1978), and Danilla v. Leatherby Ins. Co. , 168 N.J. Super. 515 (App.Div.1979). In Henze the plaintiff waited 3 1/2 years from the incurring of an expense before filing suit, and the court ruled that the claim was barred. Although within four years from the accident, clearly more than two years had elapsed since the incurring of the expense. As indicated by the first clause of N.J.S.A. 39:6A-13.1(a), the two-year four-year alternative contains the proviso "whichever is earlier." In Danilla the court had occasion to interpret the language "incurring of an expense." It held that the Legislature intended this to refer to the first such expense rather than each expense incurred. The claimants there had argued that the two-year limitation in the first clause of the statute commenced only after the incurring of each expense that was related to the accident, regardless of the date of the accident or when the expense was incurred. Although acknowledging that the language admits of two interpretations, the court nevertheless rejected that view.

A later review of the above decision held that it was implicit that the Danilla court dealt with a situation where there had been no prior payment of benefits and that the result should be different where the prior expenses had been voluntarily paid. ...

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