On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-00217-00.
Before Judges Petrella, Braithwaite and Lintner.
The opinion of the court was delivered by: Braithwaite, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted October 28, 2002
Defendant Muhammad A. Nasir was found to have violated the New Jersey Insurance Fraud Prevention Act (the "Act"), N.J.S.A. 17:33A-1 to -30. The violations arose because he provided false statements on both his application for disability benefits to Northwestern Mutual Life Insurance Company ("Northwestern Mutual") and his claim form to recover disability benefits. Plaintiff State of New Jersey, through the Office of the Insurance Fraud Prosecutor, filed a two-count complaint against defendant seeking, inter alia, the imposition of a civil penalty and the assessment of cost and counsel fees against defendant. The first count alleged fraud with respect to defendant's application for disability insurance. The second count alleged fraud with respect to defendant's claim for disability benefits. On the first count, summary judgment was granted in favor of the State and a civil penalty of $5,000 was imposed on defendant. The order also provided that the State would be awarded counsel fees and costs at the conclusion of the case.
The second count was tried by the court. Defendant was found to have violated the Act and an additional civil penalty of $2,500 was imposed on defendant. Defendant was also ordered to pay $36,210 in counsel fees to the State.
Defendant now appeals and contends that: (1) the trial judge erred in granting summary judgment on count one because there was no compliance with N.J.S.A. 17:33A-6; (2) summary judgment was inappropriate on count one because there were material issues of fact with respect to his knowledge; (3) the assessment of civil penalties and counsel fees was cumulative; and (4) he was deprived of the effective assistance of counsel. We reject these contentions and affirm.
Defendant, an insurance producer for Northwestern Mutual, began manifesting symptoms of a herniated disk in early February 1996. Back pain, in addition to numbness and tingling in his fingers, prompted him to consult Mohammed Shafi, M.D., on February 12, 1996, and again on April 15, 1996. Dr. Shafi prescribed defendant Relafen, a drug used to treat arthritis, and instructed him to do strengthening exercises; additionally, on his second examination of defendant, Dr. Shafi advised defendant to undergo an MRI scan.
The scans were conducted on April 17 and 25, 1996. The second scan results, dated April 26, revealed the herniation. Dr. Shafi's records indicate that he informed defendant of the MRI results on April 29, 1996. The severity of defendant's problem required surgery to ultimately avoid paraplegia.
In the interim, on April 27, 1996, defendant applied for disability insurance from his employer, Northwestern Mutual. In his application form defendant answered "no" to the following two questions: (1) "[h]ave you had any physical, mental or emotional condition, injury, or sickness in the past 5 years?"; and (2) "[h]ave you consulted or been attended by a physician or practitioner for any cause during the past 5 years?" On that same day, defendant filled a prescription for Relafen, the drug prescribed by Dr. Shafi.
Based on the submitted application, Northwestern Mutual provided defendant with disability insurance on May 7, 1996. On May 23, 1996, defendant underwent spinal fusion surgery. After almost a year spent recovering, on July 3, 1997, he submitted a claim for benefits to Northwestern Mutual. On his disability claim form, defendant stated that his surgery rendered him disabled and unable to work from May 20, 1996, to April 15, 1997. Further, defendant attested that he "first notice[d]" his illness on May 7, 1996, and that he had never had this condition manifested by numbness in his hands before. May 7, 1996, is both the day that defendant claimed he first noticed his symptoms and the day that Northwestern Mutual provided disability insurance for defendant.
The proximity of those events triggered suspicion, and an investigation ensued. Northwestern Mutual discovered defendant's true medical history and understood it to contradict that provided by defendant on his application for disability insurance. As such, Northwestern Mutual denied his claim and rescinded the policy. Northwestern Mutual referred the case to the Office of the Insurance Fraud Prosecutor and the complaint noted above was filed.
In point one, the issue is whether the trial judge erred in granting summary judgment because the insurance application signed by defendant did not contain a provision warning that "[a]ny person who includes any false or misleading information on an application for an insurance policy is subject to criminal and civil penalties." N.J.S.A. 17:33A-6c. Defendant did not raise this issue below, therefore we will review it under a plain error standard. Thus, we will only reverse if defendant can show that the error was "clearly capable of producing an unjust result." R. 2:10-2.
Summary judgment must be granted if "the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2. Even where the allegations of the pleadings may raise an issue of fact, if other documents or papers show that there is no real material issue, then summary judgment can be granted. Judson v. Peoples Bank & Trust Co. of Westfield, 17 N.J. 67, 75 (1954). However, "[b]are conclusions in the pleadings, without factual support in tendered affidavits, will ...