On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-4741-02.
Before Judges Stern, S.L. Reisner and Graves.
The opinion of the court was delivered by: S.L. Reisner, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted November 16, 2004
This case presents the issue whether the $100 per week personal injury protection (PIP) income continuation benefit payable, pursuant to N.J.S.A. 39:6A-4(b), to a temporarily disabled automobile accident victim, must be reduced by the amount of State temporary disability benefits she receives during the period of disability. We hold that the disability benefits must be deducted from the PIP income continuation benefit, pursuant to the collateral source rule set forth in N.J.S.A. 39:6A-6. Accordingly, we reverse the order of the trial court, which awarded plaintiff Carmen Rivera (Rivera) the $100 weekly benefit without deducting the temporary disability benefits she received.
Rivera was injured in an automobile accident on January 29, 2002. She lost twenty-nine weeks of work due to her injuries. She received State temporary disability benefits of $444 each week, but this amount was less than her weekly salary of $700. Since she still had a net loss of income, she sought income continuation benefits under the PIP portion of her policy with Liberty Mutual Insurance Company (Liberty Mutual). Her claim was denied, and she filed suit to recover the $100 per week benefit.
Liberty Mutual filed a motion for summary judgment to dismiss plaintiff's complaint. The trial court denied the motion, concluding that Rivera was entitled to the benefits because, even after receiving disability benefits, she had a net loss of income. The court rejected Liberty Mutual's argument that N.J.S.A. 39:6A-6 required that Rivera's disability benefits be deducted from her income continuation benefit. The court awarded Rivera income continuation benefits in the amount of $100 per week for the twenty-nine week period of disability pursuant to N.J.S.A. 39:6A-4(b).
Liberty Mutual contends that the collateral source rule, N.J.S.A. 39:6A-6, applies to plaintiff's receipt of income continuation benefits under N.J.S.A. 39:6A-4(b), and hence the $444 plaintiff received in State temporary disability benefits must be deducted from the PIP benefits, leaving a negative dollar amount and entitling plaintiff to nothing. We agree.
The Automobile Insurance Cost Reduction Act (AICRA), N.J.S.A. 39:6A-4, provides for personal injury protection (PIP) coverage, regardless of fault.*fn1 PIP coverage includes income continuation benefits. The basic income continuation benefit consists of
[t]he payment of the loss of income of an income producer as a result of bodily injury disability, subject to a maximum weekly payment of $100. Such sum shall be payable during the life of the injured person and shall be subject to an amount or limit of $5,200, on account of injury to any one person in any one accident, except that in no case shall income continuation benefits exceed the net income normally earned during the period in which the benefits are payable.
An insured has the option of purchasing income continuation benefits, in excess of the $100 per week basic benefit, by paying an additional premium. N.J.S.A. 39:6A-10. Income continuation benefits payable under section four or section ten are to be made available to the injured accident victim"as [the] loss accrues," N.J.S.A. 39:6A-6, without regard to fault, so that at least some of ...