August 30, 2010
SELECTIVE WAY INSURANCE COMPANY, PLAINTIFF-RESPONDENT,
TINA FUHRMAN, DEFENDANT-APPELLANT.
On appeal from Superior Court of New Jersey, Law Division, Sussex County, Docket No. L-177-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted March 23, 2010
Before Judges Fuentes and Gilroy.
In this declaratory judgment action, defendant Tina Fuhrman appeals from the order of the Law Division that granted summary judgment in favor of plaintiff, Selective Way Insurance Company (Selective). There are two questions before us on appeal. The first concerns the enforceability of a step-down clause in a commercial automobile insurance policy issued by Selective to defendant's employer that limited the amount of underinsured motorist coverage (UIM) available to defendant to the coverage limit contained in her personal automobile policy. The second question turns on the answer to the first. That is, even if the step-down clause is enforceable, we must evaluate whether there is any evidence to support defendant's claim that her employer intended her to be named as a direct insured on the Selective policy. If so, the step-down provision would not prevent defendant from recovering UIM benefits under her employer's policy.
The motion judge held that the provision in N.J.S.A. 17:28-1.1(f), rendering step-down clauses unenforceable as against public policy, should be applied prospectively, thus affecting only such policies that were issued after the date of the statute's enactment by the Legislature. Here, because the accident occurred before the date the statute was enacted, the motion judge held that the step-down clause remained enforceable, thereby limiting defendant's UIM benefits to the amount of coverage provided in her own personal automobile policy.
The trial court did not address defendant's claim that she is also entitled to UIM benefits as a named insured under the Selective policy. We agree with the court's ruling construing N.J.S.A. 17:28-1.1(f) to apply prospectively. Despite the trial court's failure to address the second claim directly, our own review of the record reveals no evidence to support defendant's argument that she is entitled to UIM benefits as a named insured under the Selective policy. We thus affirm the trial court's order granting summary judgment in favor of Selective.
We derive the following facts from the record developed before the trial court. On August 5, 2007, defendant suffered personal injuries after the car she was driving was involved in an accident with another car. Defendant's car was owned by her employer, Burlington County Community Action Program, (BCCAP), and was insured by Selective with a personal coverage and a UIM coverage limit of $1,000,000 each. The Selective policy UIM coverage also had a step-down clause, lowering the limit of available coverage to the highest coverage provided by any other automobile insurance policy in which defendant was a named insured.
On the date of the accident, defendant had a personal automobile policy providing for $100,000 UIM coverage. The tortfeasor's automobile insurance policy also had a $100,000 coverage limit. Defendant settled with the tortfeasor for $98,500, and thereafter made a demand for UIM benefits under the Selective policy. In support of her UIM claim, defendant asserted that she was a named insured in the Selective policy. Alternatively, defendant argued that the step-down clause was unenforceable pursuant to N.J.S.A. 17:28-1.1(f).
Selective filed a declaratory judgment action and defendant cross-claimed seeking coverage. The matter came before the trial court on the parties' cross-motions for summary judgment. Despite defendant's assertion that she was entitled to UIM coverage under the Selective policy as a named insured, the motion judge only addressed the question of whether N.J.S.A. 17:28-1.1(f) should be applied prospectively or retroactively. After reviewing the case law concerning this issue, the judge ruled in favor of Selective and held that the statute should only have prospective application. The court did not address defendant's claim that she was a direct insured.
On appeal, defendant argues that summary judgment was improvidently granted because there is a material issue of fact in dispute as to whether she is a named insured in the Selective policy. She also argues that the motion judge erred in construing N.J.S.A. 17:28-1.1(f) to apply prospectively.
We disagree with defendant's position in both respects. The question of how N.J.S.A. 17:28-1.1(f) should be applied was settled, in our view, in Olkusz v. Brown, 401 N.J. Super. 496, 506 (App. Div. 2008), in which we held that the statute's anti-step-down provisions are to be applied prospectively. We acknowledge that another appellate panel, although ultimately reaching the same result, viewed the issue differently. Hand v. Philadelphia Ins. Co., 408 N.J. Super. 124 (App. Div.), certif. denied, 200 N.J. 506 (2009). Until the Supreme Court decides otherwise, however, we are satisfied that the holding in Olkusz controls.
We next address the question of whether defendant is a named insured on the Selective policy. Defendant submitted a list of employees, apparently prepared by her employer, BCCAP, that included her name, address, and driver's license number. The list denoted the individuals listed as: "Bus Drivers driver license for insurance." Defendant argues that this list creates a material factual dispute as to whether BCCAP intended for her to be included as a named insured. Moreover, according to defendant, this list also shows that Selective failed to inform BCCAP that it needed to include specific language to identify who it wanted to name as a direct insured. Pinto v. New Jersey Manufacturers Ins. Co., 183 N.J. 405, 417 (2005).
We disagree. In and of itself, this list is not probative that BCCAP intended to include defendant as a named insured. Defendant had the opportunity to conduct discovery before this matter reached the trial court by way of cross-motions for summary judgment. Indeed, the fact that the parties moved for summary judgment indicates to us that both sides considered the record complete and ready for disposition as a matter of law. From this record, there is no competent evidence to suggest that BCCAP intended to name defendant as a direct insured in its policy with Selective. Given the absence of evidence to the contrary, there is no legal basis to find that Selective violated its duty to BCCAP under Pinto.
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