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Brown v. Williams

July 13, 2007


On appeal from the Superior Court of New Jersey, Law Division, Civil Part, Passaic County, L-2882-04.

The opinion of the court was delivered by: Kestin, P.J.A.D.



Argued: November 14, 2006

Before Judges Kestin, Payne, and Graves.

Plaintiff, a pedestrian wholly innocent of fault, was injured on September 10, 2003,*fn1 when a parked car backed into her as she was crossing a street at an intersection in Paterson. Defendant Fannie Y. Williams owned the vehicle; defendant Stanley Williams was driving it.

The only motor vehicle insurance coverage available to plaintiff as a result of that accident was a "basic policy" covering the Williams vehicle, issued by Allstate Insurance Company (Allstate). Plaintiff had medical coverage through a Medicaid source, which acquired a lien for any such monies expended. The Allstate policy did not afford liability insurance coverage, but it provided $15,000 in personal injury protection (PIP) benefits to injured pedestrians. Allstate eventually paid the medical expenses incurred by plaintiff up to the $15,000 limit of its policy.

The first count of the complaint in this suit, filed on June 28, 2004, named both Fannie Y. Williams and Stanley Williams as defendants and asserted a general claim for damages. The second count named the Unsatisfied Claim and Judgment Fund (UCJF) and the Commissioner of Insurance as defendants and sought payment of plaintiff's medical expenses. The third count pleaded a general damages claim against the UCJF and the Commissioner. The certification of permanent injury required by the Automobile Insurance Cost Reduction Act of 1998 (AICRA), N.J.S.A. 39:6A-8a, was attached to the complaint.

On September 3, 2004, the New Jersey Property-Liability Insurance Guaranty Association (PLIGA) filed an answer as statutory administrator of the UCJF. The answer contained a general denial and eight separate defenses, including that the suit was barred or limited by the provisions of the Automobile Reparation Reform Act; AICRA; the UCJF Act generally, N.J.S.A. 39:6-61 to -90.1; and other statutes cited.

On February 28, 2005, a default was entered against the Williams defendants and, as the result of a proof hearing, a default judgment for a total of $305,286.96 plus post-judgment interest was entered on May 4, 2005, in favor of plaintiff and against the Williams defendants "jointly and severally[.]" The total consisted of "$250,000 for pain and suffering[;] $36,670 for medical bills[,] deductible(s) and co-pay(s) incurred as a result of the subject incident[;] and $14,600 for lost wages plus prejudgment interest in the amount of $4,016.96[.]"

Plaintiff then moved for summary judgment against the UCJF/PLIGA for the payment of medical bills in excess of the $15,000 limit in the Allstate policy. The trial court denied the motion in an order entered July 1, 2005. Thereafter, plaintiff sought to execute on the judgments against the Williams defendants. No assets were found for Stanley Williams, and levy was made on bank account assets in the name of Fannie Y. Williams totaling $4,288.55. Plaintiff then moved for reconsideration of her motion against UCJF/PLIGA. The trial court denied that motion for reasons set forth in an oral opinion.

Based upon a determination that the owner and driver of the vehicle were not uninsured, but rather underinsured, the motion judge held that the statutes governing the UCJF and PLIGA did not cover such a situation, specifically "that plaintiff was not entitled to the [$]250,000 medical expense benefit under PLIGA or the fund law because the tort[]feasors['] policy provide[s] a measure of medical expense coverage[.]" In reaffirming his denial of plaintiff's PIP claim against UCJF/PLIGA, the judge recognized the "anomalies that exist[,]" and he held that the provisions of AICRA revealed no intention by the Legislature to impose responsibility on UCJF "for claims of non-economic damages of those injured by drivers insured under a basic policy[,]" as distinguished from those injured by uninsured drivers.

On appeal, initially, plaintiff argued in the first point of her brief that the trial court erred in its ruling regarding the availability, in the circumstances, of non-economic damages from UCJF/PLIGA. Specifically, plaintiff contended that the absence of liability coverage in the Williams policy resulted in coverage for plaintiff by UCJF/PLIGA. Prior to oral argument, we were advised that the parties' dispute as to this issue had been settled, subject only to the need for entry of "an 'order to pay' in order to consummate the settlement."

We are left, therefore, with the second stated issue on appeal: whether UCJF/PLIGA is responsible for payment of plaintiff's medical bills over and above those paid by Allstate, i.e., the limit of the basic policy it has issued. This dispute between the parties centers about the effective date of L. ...

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