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Simon v. CNA Insurance Co.

Decided: June 20, 1988.

KATHLEEN SIMON, EXECUTRIX OF THE ESTATE OF ALBERT J. CARINO, DECEASED, AND DOROTHY CARINO, PLAINTIFFS-APPELLANTS,
v.
CNA INSURANCE COMPANY AND CONTINENTAL INSURANCE CASUALTY COMPANY, DEFENDANTS-RESPONDENTS



On appeal from Superior Court, Law Division, Gloucester County.

Antell and Deighan. The opinion of the court was delivered by Deighan, J.A.D.

Deighan

[225 NJSuper Page 607] Plaintiffs Kathleen Simon, Executrix of the Estate of Albert J. Carino, Deceased, and Dorothy Carino appeal from a judgment entered June 22, 1987 which, although granting other relief, dismissed their claim for income continuation benefits pursuant to N.J.S.A. 39:6A-4b and 10 of the New Jersey Automobile Reparation Reform Act, N.J.S.A. 39:6A-1 et seq. (No-Fault Act). Plaintiffs maintained they were entitled to

additional income continuation benefits pursuant to N.J.S.A. 39:6A-10 upon death of the decedent arising out of an automobile accident. Although the Court granted plaintiffs' judgment for $14,600 for essential service benefits, plaintiffs assert that the interest on the award should have been computed as compound interest as of October 4, 1983. Consequently they also appeal from that part of the order allowing only simple interest.

The facts are not in dispute. On August 4, 1982, Albert J. Carino died as a result of injuries sustained in a motor vehicle accident. Decedent was employed by the State of New Jersey as a special agent by the Department of the Treasury and was driving a vehicle owned by the State at the time of the accident. He was earning $25,136.09 per year, or approximately $481.55 per week. His wife has been awarded dependency benefits under the Workers' Compensation Benefits Act, N.J.S.A. 34:15-1 et seq., consisting of $217 per week payable for 450 weeks pursuant to N.J.S.A. 34:15-12 and -13. As of April 15, 1987, she had received approximately $52,080 in dependency benefits, representing payments for 240 weeks.

At the time of the accident, decedent was insured under an automobile liability policy for personal injury protection (PIP) issued by defendants. Pursuant to N.J.S.A. 39:6A-10, the decedent exercised option 3 for additional PIP benefits which provides for maximum income continuation benefits of $18,200 and maximum essential service benefits of $14,600.

On plaintiffs' motion for summary judgment, the trial judge ruled that income continuation benefits were offset by the workers' compensation benefits received, but granted summary judgment in favor of plaintiffs for $14,600, the maximum amount of essential service benefits.

Although defendants CNA Insurance Company and Continental Casualty Company have not filed a cross-appeal, they seek to support the trial court's partial dismissal of plaintiffs' claim by arguing that the state-owned vehicle decedent was driving at

the time of the accident was not a "private passenger automobile" and that therefore no PIP benefits were payable.

I

Plaintiffs contend the maximum income continuation benefits are payable upon the death of decedent without offset for the workers' compensation dependency benefits being paid to decedent's widow.

Since the policy was issued prior to January 12, 1982, the rights of plaintiff are determined by Muschette v. The Gateway Insurance Co., 149 N.J. Super. 89 (App.Div.1977), aff'd 76 N.J. 560 (1978). In Muschette this court held that essential service benefits and income continuation benefits payable under N.J.S.A. 39:6A-4b. and c. were payable without the necessity of proving the actual amount of loss. 149 N.J. Super. at 94-99; see also Maros v. Transamerica Insurance Company, 76 N.J. 572, 576-579 (1978).*fn1 The issue here is whether income continuation benefits payable under the Workers' Compensation Act must be offset pursuant to N.J.S.A. 39:6A-6, the collateral source rule which provided in part:

The benefits provided in section 4a., b., c., d., and e. [ N.J.S.A. 39:6A-4a through e] and section 10 [ N.J.S.A. 39:6A-10], shall be payable as loss accrues, upon written notice of such loss and without regard to collateral sources, except that benefits collectible under workmen's compensation insurance . . . shall be ...


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