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Murphy v. Allstate Insurance Co.

Decided: November 27, 1991.

JOSEPH MURPHY, MARY ELLEN AGUNZO AND DAVID KOTKES, PLAINTIFFS-RESPONDENTS,
v.
ALLSTATE INSURANCE COMPANY, DEFENDANT, AND NEW JERSEY AUTOMOBILE FULL INSURANCE UNDERWRITING ASSOCIATION AND KENNETH D. MERIN, COMMISSIONER OF INSURANCE, DEFENDANTS-APPELLANTS



On appeal from Superior Court of New Jersey, Law Division, Ocean County, whose opinion is reported at 246 N.J. Super. 42.

Gaulkin, Brody and Muir, Jr. The opinion of the court was delivered by Brody, J.A.D.

Brody

We now consolidate these separate appeals from a summary judgment entered in plaintiffs' favor. The trial court opinion is reported at 246 N.J. Super. 42, 586 A.2d 860 (Law Div.1990).

Plaintiffs sustained minor injuries in an automobile accident on March 18, 1989. Because they neither owned an automobile nor lived in the household of an immediate family member who did, they had to meet a statutory verbal threshold of serious injury to be eligible to recover for noneconomic loss. Plaintiffs brought this action for a judgment declaring that the statute unconstitutionally denied them equal protection of the law because, unlike themselves, owners of automobiles could purchase automobile insurance policies which, for an additional premium, would enable them and immediate family members living in their household to sue for noneconomic loss without having to meet a verbal threshold. The trial court agreed with plaintiffs and ruled that the statute was unconstitutional. We disagree and reverse.

N.J.S.A. 39:6A-8, which is the subject of this action, was amended on March 12, 1990, and no longer subjects people such as plaintiffs to the verbal threshold. However, at the time of the accident the statute provided in relevant part:

One of the following two tort options shall be elected, in accordance with [ N.J.S.A. 39:6A-8.1], by any named insured required to maintain personal injury protection [PIP] coverage pursuant to [ N.J.S.A. 39:6A-4]:

a. Every owner, registrant, operator or occupant of an automobile to which [PIP] coverage . . . applies . . . is hereby exempted from tort liability for noneconomic loss to a person who . . . has a right to receive [PIP] benefits . . . unless that person has sustained a personal injury which results in death; dismemberment; significant disfigurement; a fracture; loss of a fetus; permanent loss of use of a body organ, member, function or system; permanent consequential limitation of use of a body organ or member; significant limitation of use of a body function or system; or a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute that person's usual and customary daily activities for not less than 90 days during the 180 days immediately following the occurrence of the injury or impairment; or

b. As an alternative to the basic tort option specified in subsection a. of this section, every owner, registrant, operator, or occupant of an automobile to

which [PIP coverage] . . . applies . . . shall be liable for noneconomic loss to a person who . . . has a right to receive [PIP] benefits. . . .

The tort option provisions of subsection a. of this section shall also apply to the right to recover for noneconomic loss of any person eligible for [PIP] benefits . . . but who is not required to maintain personal injury protection coverage and is not an immediate family member, as defined in [ N.J.S.A. 39:6A-8.1], under an automobile insurance policy.

N.J.S.A. 39:6A-8.1 provided in relevant part:

a. Election of a tort option pursuant to [ N.J.S.A. 39:6A-8] shall be in writing and signed by the named insured on the coverage selection form required by [ N.J.S.A. 39:6A-23]. The form shall state the percentage difference in the premium rates of the dollar savings between the two tort options. The tort option elected shall apply to the named insured and any immediate family member residing in the named insured's household. "Immediate family member" means the spouse of the named insured and any child of the named insured or spouse residing in the named insured's household, who is not named insured under another automobile insurance policy.

b. If the named insured fails to elect, in writing, any of the tort options offered pursuant to [ N.J.S.A. 39:6A-8] the named insured shall be deemed to elect the ...


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