On certification to the Superior Court, Appellate Division.
For affirmance -- Justices Clifford, Handler and Pollock. For reversal and remandment -- Chief Justice Wilentz, and Justices O'Hern, Garibaldi and Stein. The opinion of the Court was delivered by Garibaldi, J. Clifford, J., Dissenting. Handler and Pollock, JJ., join in this Dissenting opinion.
This appeal concerns the scope of N.J.S.A. 17:33A-4(a), a provision of the New Jersey Insurance Fraud Prevention Act (the Act), N.J.S.A. 17:33A-1 to -14, and the civil penalties to be imposed for violations thereof pursuant to N.J.S.A. 17:33A-5(a). Specifically, we must determine the extent to which the Act penalizes a person who has submitted several false statements in support of a single fraudulent claim for insurance benefits. The Commissioner of Insurance (Commissioner) argues that each knowing and material false written statement presented in support of an insurance claim constitutes a separate violation of N.J.S.A. 17:33A-4(a) and, accordingly, each false submission subjects the claimant to a separate penalty pursuant to N.J.S.A. 17:33A-5(a). On the other hand, defendant, Robert Maglaki, contends that all of the false statements made in support of a single insurance claim constitute a single violation of N.J.S.A. 17:33A-4(a), and therefore regardless of the number of untrue statements submitted in support of an insurance claim, only one penalty should be imposed per claim.
The trial court disagreed with the Commissioner's interpretation of the Act and imposed a single penalty on defendant, who had submitted six falsified documents in support of a fraudulent claim for life insurance benefits. The Appellate Division affirmed. We now reverse.
We hold that the plain language of the Act as well as the legislative intent behind the statute support the Commissioner's interpretation. The Act authorizes a sanction for each material false statement knowingly submitted in support of a fraudulent claim for insurance proceeds that significantly enhances the credibility of or evidentiary support for the claim. Moreover, we hold that the civil penalties authorized by the Act are remedial in nature and do not constitute a second "punishment"
of Maglaki within the meaning of the Double Jeopardy Clauses of the federal and state constitutions.
On June 30, 1986, Maglaki submitted a fraudulent claim to Prudential Insurance Company (Prudential) in an attempt to collect $300,000 in accidental-death benefits from two insurance policies on the life of his wife, Antonieta. Maglaki falsely claimed that Mrs. Maglaki had died in an automobile accident in the Philippines twelve days earlier. In fact, Antonieta Maglaki was alive.
In support of his fraudulent claim, Maglaki submitted six falsified documents: a claim form, an authorization to release information relating to his wife, a traffic-accident investigation report that purported to be a document prepared by the Manila Police Department, a certificate of death, a certificate of post-mortem examination, and a receipt for a burial permit. The last three submissions purported to be official documents from the Republic of the Philippines. All six documents represented that Mrs. Maglaki had died in an automobile accident in Manila on June 18, 1986. That each document contained false and misleading statements concerning the death of Antonieta Maglaki and the expenses surrounding her funeral and burial is undisputed. Each document also supported the false claim for accidental-death benefits presented by Maglaki.
On June 10, 1988, Maglaki pleaded guilty to a single count of third-degree attempted theft by deception in violation of N.J.S.A. 2C:5-1 and 2C:20-4 arising from his efforts to secure property, the life-insurance proceeds, to which he was not entitled. The court thereafter sentenced him to five-years probation, 500 hours of community service, and $530 in fines.
Subsequently, the Commissioner filed a civil suit seeking penalties and other relief from Maglaki, pursuant to N.J.S.A. 17:33A-4. The complaint set forth six separate counts and charged that Maglaki had committed six separate violations of
N.J.S.A. 17:33A-4, once for each fraudulent document submitted in support of his claim. The Commissioner asked the trial court to impose penalties totalling $30,000, $5,000 for each separate offense.
The trial court granted the Commissioner's summary judgment motion with respect to liability, but held that Maglaki's action constituted a single violation of the statute rather than six separate violations. The court therefore imposed a penalty of only $2,500.
The Appellate Division affirmed, in an unreported opinion, substantially for the reasons stated by the trial court. We granted certification, 126 N.J. 320, 598 A.2d 880 (1991).
N.J.S.A. 17:33A-4 provides in pertinent part:
a. A person or a practitioner, violates this act if he:
(1) Presents or causes to be presented any written or oral statement as part of, or in support of or opposition to, a claim for payment or other benefit pursuant to an insurance policy, knowing that the statement contains any false or misleading information concerning any fact or thing material to the claim; or
(2) Prepares or makes any written or oral statement that is intended to be presented to any insurance company or any insurance claimant in connection with, or in support of or opposition to any claim or payment or other benefit pursuant to an insurance policy, knowing that the statement contains any false or misleading information concerning any fact or thing material to the claim * * *.
Penalties for violations of the Act are set forth in N.J.S.A. 17:33A-5 as follows:
a. If a person or practitioner is found by a court of competent jurisdiction, pursuant to a claim initiated by the commissioner, to have violated any provision of this act, the person or practitioner shall be subject to a civil penalty not to exceed $5,000.00 for the first violation, $10,000.00 for the second violation and $15,000.00 for each subsequent violation.
Construction of any statute necessarily begins with consideration of its plain language. Kimmelman v. Henkels & McCoy, Inc., 108 N.J. 123, 128, 527 A.2d 1368 (1987); Renz v. Penn Cent. Corp., 87 N.J. 437, 440, 435 A.2d 540 (1981). Such language ...