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DeMary v. Metlife Auto & Home Insurance Co.

July 13, 2009


On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-7416-07.

Per curiam.


Submitted: June 16, 2009

Before Judges Axelrad and Winkelstein.

Plaintiff Yolanda DeMary appeals from summary judgment dismissal of her complaint against MetLife Auto and Home Insurance Company (MetLife) for underinsured motorists (UIM) benefits based on untimely notification of her settlement with the tortfeasor. We affirm.

Viewed most favorably for plaintiff, Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995), the motion record reveals the following.*fn1 Plaintiff, a pedestrian, was injured on October 8, 2006, when she was struck in New York City by a motor vehicle operated by Edwin Nieves and owned by Erik Felix. Nieves, who was driving with the owner's permission, was uninsured; however, Felix had a USAA General Indemnity Company (USAA) liability insurance policy covering the subject vehicle in the amount of $25,000. Plaintiff, a New Jersey resident, was insured through MetLife by a policy that included $100,000 in combined single-limit UIM coverage. By letter of November 29, 2006, plaintiff notified MetLife of the accident and of her intention to pursue UIM benefits under her policy. This letter was silent as to any settlement offer by the tortfeasor's carrier.

On December l8, 2006, MetLife was advised by USAA that USAA had already settled the matter; according to USAA's correspondence, it had mailed a release and settlement check for the $25,000 policy limit directly to plaintiff on December l3, 2006. In depositions, plaintiff testified she received the check and release on December 20, deposited it into her own account on December 21, and thereafter withdrew funds for payment of her attorney and for her personal use. When asked if she had any communications with MetLife prior to December l3, 2006, plaintiff indicated she did not talk to anyone at MetLife about the $25,000 settlement offer. Plaintiff related that her sole conversation with a representative of MetLife was in late October or early November, during which they discussed payment of her premiums, at which point the case had not been settled with USAA.

On January 30, 2007, plaintiff's counsel first notified MetLife by letter of USAA's offer to settle on behalf of the tortfeasor and that plaintiff was making a claim for the full $100,000 supplemental benefits under her UIM policy. Plaintiff acknowledged in her deposition that she was unaware of any prior letter from her attorney communicating to MetLife that USAA extended a $25,000 offer. MetLife subsequently denied plaintiff's UIM claim based on a Longworth*fn2 defense.

Plaintiff filed suit for UIM benefits. MetLife sought summary judgment dismissal of plaintiff's complaint, arguing plaintiff failed to comply with the requirements of Longworth v. Van Houten, 223 N.J. Super. 174, 194 (App. Div. l988), by notifying Metlife of USAA's offer prior to plaintiff's acceptance of it, which denied the UIM carrier the opportunity to take action to preserve its subrogation rights against the tortfeasor. See also Rutgers Cas. Ins. Co. v. Vassas, 139 N.J. 163, 169-72 (1995) (expressly approving the UIM notification procedure set forth in Longworth).

In addition to the aforementioned correspondence and deposition testimony, plaintiff submitted the certification of her attorney indicating, in part, that in early November 2006, USAA informed him that it would be offering the full policy to settle plaintiff's personal injury case and that sometime "[b]etween Monday, December 4, 2006 and Friday, December 8, 2006" he advised Danielle Alexander from MetLife of USAA's settlement offer and of plaintiff's intention of accepting it. He further certified that "[a]t no time did any representative of MetLife indicate to me that they were interested in exercising any right to subrogation in November 2006, December 2006, and January 2007."

By order of July 3, 2008, Judge Richard J. Donohue dismissed plaintiff's claims with prejudice, finding, "[a]ll the certifications clearly indicate that [defendant's] opportunity to seek subrogation v. the tortfeasor have been waived by settle[ment] w[ith] the tortfeasor's carrier w[ithout] preserving this [defendant's] r[igh]ts to subrogation." This appeal ensued.

On appeal, plaintiff renews her argument made to the trial court. She contends that MetLife was provided ample notice of the proposed settlement with USAA before she accepted it and never demonstrated any interest in exercising a right to subrogation. We disagree that the record supports plaintiff's position, even when viewed with all favorable inferences to her as the non-moving party. See Brill, supra, 142 N.J. at 540. We expressly note that plaintiff testified she did not inform MetLife's representatives of the settlement offer during any conversation prior to December l3, 2006, and her attorney's letter of November 29, 2006 to MetLife made no reference whatsoever of a settlement offer by the tortfeasor's insurance carrier. Even if the offer were communicated verbally by plaintiff's attorney to a MetLife representative sometime around Friday, December 8, 2006, MetLife was not provided adequate notification in accordance with Longworth to take steps to preserve its subrogation rights, as USAA's check was mailed out three business days later. Furthermore, pursuant to plaintiff's attorney's instructions to USAA, the check was not held in escrow, but rather was sent directly to plaintiff, and was deposited and cashed by her immediately upon receipt. Accordingly, Judge Donohue properly concluded as a matter of law that plaintiff was not entitled to UIM benefits through her automobile policy with MetLife.


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