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Zoraida Ramos v. Allstate New Jersey Insurance Company


March 31, 2011


On appeal from the Superior Court of New Jersey, Law Division, Gloucester County, Docket No. L-1519-09.

Per curiam.


Submitted March 8, 2011 -- Decided

Before Judges Yannotti and Skillman.

Plaintiff Zoraida Ramos appeals from an order entered by the Law Division on December 22, 2009, dismissing her complaint against defendant Allstate New Jersey Insurance Company (Allstate) because it was filed beyond the time required by N.J.S.A. 39:6A-13.1(a). We affirm.

On November 4, 2004, plaintiff was injured in an automobile accident. She was covered under an automobile insurance policy issued by Allstate, which provided personal injury protection (PIP) benefits. Thereafter, Allstate paid for certain chiropractic and pain management treatment that plaintiff received. On November 7, 2006, Allstate made the last payment to plaintiff's treating medical providers.

In May 2007, Dr. Lawrence I. Barr, D.O. (Barr), evaluated Ramos's right shoulder and issued a report dated May 22, 2007, in which he stated that plaintiff was suffering from "impingement syndrome" of the right shoulder with a "full thickness rotator cuff tear[.]" Barr said that conservative treatment had failed and plaintiff would be scheduled for arthroscopic rotator cuff repair.

By letter dated June 1, 2007, Auto Injury Solutions (AIS), Allstate's representative, informed Barr and plaintiff that the procedure had not been certified for payment because an MRI indicated that there "clearly" was a pre-existing "shoulder pathology." In its letter, AIS also stated that there was no indication of a causal relationship between plaintiff's shoulder injury and the November 4, 2004, auto accident, nor was there any "documentation of conservative care."

Furthermore, at Allstate's request, Dr. Todd M. Lipschultz (Lipschultz), reviewed plaintiff's medical records and performed a physical examination. In a report dated June 18, 2007, Lipschultz noted that plaintiff had been involved in two prior motor vehicle accidents and had been diagnosed with cervical disc herniations as well as right carpal tunnel syndrome and right cubital tunnel syndrome. He noted that plaintiff had reported that she had a prior injury to her right shoulder.

Lipschultz additionally stated that there was nothing in the medical records indicating that plaintiff had "continued symptomatology" in her right shoulder since the accident. He wrote that the results of the MRI and the physical examination were consistent "with an impingement syndrome with degenerative arthritis[.]" Lipschultz also wrote that there was no indication that plaintiff had "been through a good course of conservative care for her right shoulder" which would consist of oral anti-inflammatory medication, physical therapy, and "attempts at cortisone injections[.]"

Lipshultz further stated that plaintiff appeared to be "at maximum medical improvement" with regard to the injuries sustained in the November 4, 2004, accident. He noted that his exam revealed that the neck and back were "benign," and plaintiff had full cervical and lumbosacral range of motion. Although plaintiff had reported "complaints of neurogenic findings" in her upper right extremity, this condition apparently had been documented prior to the November 4, 2004, accident.

Lipschultz also wrote that plaintiff's right shoulder was symptomatic and she had signs of "impingement syndrome." Lipschultz observed that this condition might have been aggravated "for a period of time by the accident." He stated, however, that it appeared that plaintiff "had been symptomatic in her right shoulder prior to the accident[.]" Lipschultz wrote that while Ramos has had "intermittent symptoms since the accident," this could be the result of the arthritic process.

On June 21, 2007, Barr performed the arthroscopic procedure on plaintiff's right shoulder to repair the torn rotator cuff. After a follow-up examination, Barr said that plaintiff would require continued "aggressive therapy" on the shoulder in the form of pain management. Thereafter, plaintiff requested that Allstate authorize additional treatment and consultations for her right shoulder.

On July 25, 2007, AIS informed plaintiff and her attorney that such treatment would not be approved. In January 2008, in response to another request for additional treatment and consultations, AIS again told plaintiff and her attorney that it could not confirm that the treatment was medically necessary and, therefore, would not recommend payment of the medical expenses for pain management. After a further examination by Barr, plaintiff's attorney submitted another claim for PIP benefits. In October 2008, AIS again denied the claim.

On August 27, 2009, plaintiff filed an order to show cause and verified complaint in the Law Division, seeking an order requiring Allstate to pay for continued pain management and physical therapy for her right shoulder. Allstate thereafter filed a motion to dismiss the complaint pursuant to Rule 4:6-2(e) for failure to state a claim upon which relief could be granted. Allstate argued that the complaint should be dismissed because it was filed beyond the time prescribed by N.J.S.A. 39:6A-13.1(a).

The trial court considered the matter on December 22, 2009, and filed a letter opinion in which it found that, because Allstate's last PIP payment was on November 7, 2006, plaintiff was required by N.J.S.A. 39:6A-13.1(a) to file her complaint within two years of that date. The court determined that the complaint was untimely because it was not filed until August 27, 2009.

The court noted that an insurer may be required to pay PIP benefits after expiration of the statutory time period if the insurer was aware or should have been aware of the need for future treatment that is "causally related" to the accident. The court found, however, that plaintiff's right shoulder condition was not causally related to the accident or of such a nature that a recurrence after an extended period of time could have been anticipated.

The court additionally found that the doctrine of equitable estoppel barred plaintiff from asserting a claim for PIP benefits beyond the time prescribed by N.J.S.A. 39:6A-13.1(a). The court stated that plaintiff and her attorney had been in contact with Allstate after the insurer made its last payment of PIP benefits, and had been duly notified of the insurer's refusal to authorize additional treatment for plaintiff's right shoulder. The court said that because plaintiff and her attorney had notice of the denials of coverage, a complaint should have been filed within the time required by the statute.

The court memorialized its decision in an order dated December 22, 2009. This appeal followed. Plaintiff argues that:

1) the trial court erred by finding her complaint was time-barred; 2) the court erroneously determined that equitable estoppel barred her claim against Allstate; and 3) the court abused its discretion by allowing Allstate to file a motion to dismiss the complaint on short notice when Allstate had not filed a timely answer to the complaint.

We turn first to plaintiff's argument that the court erred by permitting Allstate to file its motion to dismiss on short notice. According to plaintiff, when Allstate filed its motion on October 2, 2009, it was in default because it had not filed its answer by the date prescribed by the order to show cause, which was September 17, 2009. In our view, these arguments are entirely without merit.

As Allstate points out, the trial court had initially scheduled the matter for September 25, 2009, but the return date was adjourned because plaintiff had not served Allstate with the complaint and the supporting papers. The court gave Allstate until October 5, 2009, to file its answer and response to the order to show cause. Allstate filed its motion to dismiss in lieu of answer on October 2, 2009. We are satisfied that the court did not abuse its discretion by entertaining Allstate's motion.

We next consider plaintiff's contention that the trial court erred by finding that her complaint was barred by N.J.S.A. 39:6A-13.1(a). The statute provides in pertinent part that actions for the payment of PIP benefits under auto insurance policies must be commenced no later than two years after the injured person suffers a loss or incurs an expense and either knows or in the exercise of reasonable diligence should know that the loss or expense was caused by the accident, or not later than four years after the accident whichever is earlier, provided, however, that if benefits have been paid before then an action for further benefits may be commenced not later than two years after the last payment of benefits. [Ibid. (emphasis added).]

Here, it is undisputed that Allstate's last payment of PIP benefits was made on November 7, 2006. The trial court correctly found that plaintiff's complaint was time-barred because it was not filed within two years of that date.

Plaintiff argues, however, that her complaint was timely filed because Allstate had paid for treatment to her right shoulder after the November 4, 2004, accident, and her injury was of such a nature that Allstate should have reasonably anticipated that future treatment would be required. In support of this argument, plaintiff relies upon Zupo v. CNA Ins. Co., 193 N.J. Super. 374 (App. Div.), aff'd, 98 N.J. 30 (1984).

In Zupo, the plaintiff was struck by an automobile and suffered serious injuries to her left ankle and foot. Id. at 377-78. The plaintiff was under active treatment for about two years and, during that time, developed an osteomyelitic infection at the injury site which required extensive treatment. Id. at 378. The liability insurer for the driver's car paid the plaintiff's medical expenses under PIP until some time in 1975, after her last hospitalization. Ibid. The plaintiff suffered a recurrence of the osteomyelitis about five years later. Ibid. The insurer denied her claim for PIP benefits, relying upon N.J.S.A. 39:6A-13.1. Ibid. The plaintiff brought suit about fifteen months after the recurrence of the disease. Ibid. The trial court dismissed the action because it had not been filed within two years of the last payment of PIP benefits. Id. at 378-79.

We reversed. Id. at 384. We held that under these circumstances, the statute of limitations did not apply. Id. at 382. We stated that:

[I]f the original medical condition for which the PIP carrier has assumed a payment obligation is by its nature subject to the probability of recurrence or to the probability of the need for future treatment, the carrier is chargeable at the outset with knowledge of these inherent probabilities. It is also, therefore, fairly chargeable with anticipating from the outset the likelihood of being called upon to make treatment payments in the future. It obviously makes no conceptual difference if the original anticipation is a recurrence of the compensable illness two years after the last payment or more than two years thereafter, provided only that it is in the nature of the illness that recurrence is likely after an interval of time. We perceive no purpose or policy served by a limitations statute which would be promoted by excusing a carrier from its obligation simply because the insured suffers a compensable illness which is known to be subject to recurrence at intervals greater than two years. [Ibid.]

We remanded the matter to the trial court for a hearing to determine whether "osteomyelitis is so likely to recur after a protracted period of apparent cure as to render its recurrence after five years a probable event." Id. at 384.

The Supreme Court modified our judgment and affirmed, finding no need for a remand because the trial court had already conducted such a hearing and made findings favorable to the plaintiff. Zupo, supra, 98 N.J. at 32-33. The Court stated that the statute of limitations did not apply to the plaintiff's complaint because, when the insurer made its last PIP payment, "it was chargeable with knowledge" that the plaintiff's "condition would probably recur, and hence that there would probably be future medical expenses." Id. at 33. The Court added that its decision "embraces a severely limited class of causally-related medical conditions, namely, those whose insidious nature is such that their recurrence after an extended period of apparent cure is probable." Ibid.

Plaintiff's reliance upon Zupo is misplaced. In this matter, Allstate determined that the injury to plaintiff's right shoulder was not causally related to the auto accident of November 4, 2004, and pre-dated that accident. Thus, this case does not involve a situation where the insurer was chargeable with knowledge that an injury that is causally related to the covered accident would probably require additional treatment after a period of apparent cure, as was the case in Zupo.

Furthermore, in this matter, the record shows that Allstate informed plaintiff and her attorney within two years after the last PIP payment that it would not authorize or pay for any further treatment or consultations for her right shoulder. Plaintiff had ample time to file a timely complaint challenging the insurer's refusal to pay for additional treatment and consultations. She failed to do so. In our view, the trial court correctly found that N.J.S.A. 38:6A-13.1(a) barred plaintiff's claim against Allstate.

In view of our determination, we need not consider whether the trial court erred by finding, as an alternative basis for granting summary judgment in favor of Allstate, that plaintiff was equitably estopped from arguing that the statute of limitations should not be applied to her claims.



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