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State v. Oliveira

July 27, 2007


On appeal from the Superior Court of New Jersey, Law Division, Civil Part, Mercer County, L-2991-04.

Per curiam.


Submitted: January 30, 2007

Before Judges Kestin, Graves and Lihotz.

This is a civil action under the Insurance Fraud Prevention Act (the Act), N.J.S.A. 17:33A-1 to -30. Defendant, Noemio Oliveira, appeals from an order of April 4, 2006, granting the summary judgment motion of plaintiff, the State of New Jersey. The complaint sought a determination that defendant had violated the Act, imposition of a civil penalty of $5,000 for the first offense and a civil penalty of $10,000 for the second offense, assessment of costs and counsel fees, and a one-year suspension of driving privileges.

The order granting plaintiff's motion for summary judgment recited that defendant "is liable for two violations of the Fraud Act;" required defendant to "pay a civil penalty in the amount of $7,500, attorneys fees in the amount of $4,749[,] and costs in the amount of $99.95[,] for a total of $12,249.95[;]" and suspended defendant's driving privileges for one year. On the same date, the trial court denied defendant's motion for summary judgment seeking dismissal of the complaint.

On appeal, defendant argues that plaintiff's motion for summary judgment should have been denied "based on the mens rea requirement of [the Act];" that the penalty should not have been imposed because "the State had not proven that misrepresentations were used to significantly enhance the credibility of the evidentiary support of the claim;" that "a $7,500 penalty was not reasonable;" and that the trial court erred in denying defendant's motion for summary judgment based on arguments that the claim in this matter was barred by the doctrine of laches and the entire controversy doctrine.

The essential factual background of the matter is undisputed. This complaint was predicated upon a judgment entered by the Law Division in another matter in 2001, following a three-day bench trial, in which Judge Pisansky found that the issuing carrier of a policy of motor vehicle insurance, New Jersey Manufacturers Insurance Company, had proved that defendant had misrepresented his place of residency and had made other misrepresentations on his initial insurance application and on renewal. Judge Pisansky held that the carrier was justified in rescinding the policy.

Judge Pisansky, in his written opinion, recounted that defendant had been seriously injured in an accident during the early morning hours of November 16, 1997, on the Westbound side of Route 78, while en route to Easton, Pennsylvania, where his wife and child lived. After a period of hospitalization, defendant "requested that the medical equipment needed for his continuing recovery be sent to his 'vacation home' in Easton, Pennsylvania. This request prompted an investigation by . . . NJM." Based on the evidence before him, Judge Pisansky found that defendant was not a resident of New Jersey, and had misrepresented his residency status to the carrier at critical times, including on renewal of the policy, at least once using his brother's address in New Jersey; that he had also misrepresented other material information, such as his marital status, how he had acquired the motor vehicle initially insured and whether he had previously insured it, whether other members of his household were licensed drivers, and whether he was using the additionally insured vehicle--which he was driving when the 1997 accident occurred--for business or commuting purposes.

Judge Innes, in rendering his oral opinion of March 31, 2006, in the instant matter, recited the foregoing background and determined that defendant was barred by principles of collateral estoppel from asserting facts at variance with those found by Judge Pisansky. See Hennessey v. Winslow Twp., 183 N.J. 593, 599 (2005). In assessing the applicability of the provision of the Act at issue in this matter that prohibits knowing misrepresentations, Judge Innes determined, further, after reviewing the entire prior proceeding and, more specifically, Judge Pisansky's finding that the misrepresentations taken together demonstrate an intent on the part of [defendant] to obtain a policy to which he was not entitled and/or to substantially reduce his premiums, it's clear that Judge Pisansky did determine that [defendant] made the material representations knowingly. Moreover, [defendant] was in a position in the prior proceeding to offer testimony to the contrary, namely, that such representations were not knowingly made or were made by mistake. No such testimony was offered.

Finally, defendant's misrepresentations . . . on his application for insurance and subsequent renewals, as well as during the claims process[,] were objective facts known to him at the time.

Accordingly, Judge Innes granted plaintiff's motion for summary judgment in the terms described above.

Our review of the record discloses that defendant's arguments regarding the issue of knowing misrepresentation and its effects are without sufficient merit to warrant further discussion in this opinion. R. 2:11-3(e)(1)(E). Given the repeated acts of misrepresentation by defendant, the penalty assessment was manifestly reasonable. See Merin v. Maglaki, 126 N.J. 430, 440 (1992)("under the Act a civil penalty may be imposed . . . for each of the knowing and material false statements . . . submitted which significantly enhanced [the] fraudulent claim"); see also State v. Fleischman, 189 N.J. 539 (2007)(regarding multiple acts of insurance fraud); see generally In re Garay, 89 N.J. 104, 111-117 (1982)(regarding the test of reasonableness governing civil penalties for fraudulent conduct and similar acts).

Finally, we reject the laches and entire controversy arguments advanced by defendant as also without sufficient merit to warrant discussion in a written opinion. We are in substantial agreement with Judge Innes's reasons for rejecting those arguments and ...

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