United States District Court, D. New Jersey, Camden Vicinage
ANNE M. FINEGAN, Plaintiff,
SUSAN M. DICKENSON, et al., Defendants.
ORDER [DOC. NO. 7]
SCHNEIDER, UNITED STATES MAGISTRATE JUDGE.
matter is before the Court on the “Motion to Apply the
Verbal Threshold Pursuant to the Deemer Statute” filed
by defendant Susan M. Dickenson. [Doc. No. 7]. The Court
received plaintiff's opposition [Doc. Nos. 11, 12] and
Dickenson's reply [Doc. No. 16]. The Court exercises its
discretion not to hold oral argument. Fed.R.Civ.P. 78; L.
Civ. R. 78.1. For the reasons to be discussed,
Dickenson's motion is granted.
August 6, 2016, plaintiff (Pennsylvania resident) was a
passenger in a vehicle driven by Kevin Connor (Pennsylvania
resident) when the vehicle was involved in a motor vehicle
accident in New Jersey driven by defendant Susan M.
Dickenson. The Connor vehicle was registered to Connor's
parents and insured by Chubb (New Jersey authorized insurer).
Plaintiff is a named driver on her parents' insurance
policy from Cincinnati (New Jersey authorized insurer) with
limited tort option under PA law. Defendant is a New Jersey
resident insured by a New Jersey insurer.
alleges that defendant was distracted by the use of her cell
phone, causing defendant's vehicle to cross the center
line, resulting in a head-on collision with the Connor
vehicle. Following the accident, Chubb (Connor's insurer)
denied PIP coverage to plaintiff stating: “Under an
automobile policy issued in the State of Pennsylvania,
Priority of Coverage is the injured person's own
automobile insurance policy, a household automobile insurance
policy and then possibly the involved vehicle's
policy.” Ex. E to Pl.'s Opp'n [Doc. No. 11-1].
Plaintiff subsequently filed a claim with her parents'
Cincinnati policy which paid $10, 000 in PIP medical bills,
exhausting her First Party Benefits under the Cincinnati
policy. Ex. G to Pl.'s Opp'n [Doc. No. 11-3].
December 27, 2016, plaintiff filed this lawsuit. Defendant
filed her answer and the present motion on February 22, 2017.
[Doc. Nos. 6, 7]. The Court granted motions to intervene
filed by Chubb and Cincinnati on April 7, 2017. [Doc. No.
18]. Pursuant to 28 U.S.C. § 636(c), the parties
consented to the jurisdiction of this Court to hear the case.
[Doc. No. 21].
Jersey's “Deemer” Statute (N.J.S.A.
17:28-1.4) addresses the situation when non-resident
motorists are involved in accidents in New Jersey. The
statute requires that if a nonresident's insurer is
authorized to do business in New Jersey, the insurer must
provide personal insurance protection (“PIP”)
benefits to the non-resident. New Jersey's automobile
insurance scheme allows prospective insureds to choose
between two coverage options. “The first type of
coverage, outlined in section 39:6A-8(a), is known as
‘verbal threshold' coverage, and precludes tort
recovery for non-economic injuries except those that fall
into six specific categories.” Staub v. United
States, C.A. No. 08-2061(JBS/KMW), 2010 WL 743926, at *2
(D.N.J. Mar. 3, 2010). The second type of coverage (Section
39:6A-8(b)), allows for unlimited recovery for non-economic
injuries in exchange for higher premiums. Id. As
noted, the “Deemer” Statute requires New Jersey
authorized insurers (licensed in New Jersey) to provide
non-resident insureds, among other things, PIP coverage.
Id. at *3. Importantly, if PIP coverage is provided
the verbal threshold provision of N.J.S.A. 39:6A-8(a) is
deemed to apply. Nortesano v. Torres-Romero, 2006 WL
3475201 ( N.J.Super. App. Div. Dec. 4, 2006); Dyszel v.
Marks, 6 F.3d 116, 120 (3d Cir. 1993). The parties
dispute whether the verbal threshold applies to plaintiff.
determining whether the verbal threshold applies to
nonresident drivers, New Jersey courts have created a
two-prong test. Staub, at *3. The first prong
requires an examination of whether the defendant is the owner
or operator of an “automobile” and is entitled to
receive no-fault PIP benefits under section 39:6A-4. The
second prong focuses on whether the plaintiff is a person
subject to the verbal threshold statute and is required to
maintain PIP coverage, or has a right to receive PIP benefits
under N.J.S.A. 39:6A-4. Id. (citing Beaugard v.
Johnson, 281 N.J.Super. 162, 167 (App. Div. 1995)). In
the present matter the first part of the two-prong test is
easily satisfied. Defendant is the owner/operator of her car
and is entitled to receive PIP benefits as a New Jersey
resident. The crux of the present dispute is whether
plaintiff's characteristics satisfy the second prong.
Plaintiff is Subject to the Verbal Threshold by Operation
parties concede the Connor vehicle is the vehicle pertinent
to the present analysis as it is subject to the
“Deemer” Statute by being used in New Jersey and
insured by a New Jersey authorized insurer-Chubb.
See Pl.'s Opp'n at 6 (“Defendant
argues and Plaintiff agrees that Deemer does apply to the
Connor vehicle.”). Plaintiff argues, however, that the
Deemer statute does not apply to her. Defendant disagrees.
The Court sides with defendant. Def.'s Reply at 1 [Doc.
No. 16]. Pursuant to N.J.S.A. 39:6A-8(a), plaintiff is
subject to the verbal threshold because she is entitled to
receive PIP benefits under N.J.S.A. 39:6A-4 by operation of
law. The relevant portion of N.J.S.A. 39:6A-8(a) provides:
“Every owner, registrant, operator or occupant of an
automobile to which [PIP coverage, Section 39:6A-4] . . .
regardless of fault, applies, and every person or
organization legally responsible for his acts or omissions,
is hereby exempted from tort liability for noneconomic loss
to a person who . . . is a person who has a right to receive
benefits under [PIP coverage, Section 39:6A-4]. The decision
in Koff v. Carrubba, 290 N.J.Super. 544, 547 (App.
Div. 1996) is instructive:
A person who is neither a named insured under a New Jersey
automobile liability policy nor a family member residing with
such a named insured is entitled to receive PIP benefits only
for an injury . . . which he or she has suffered while
occupying, entering into, alighting from or using a named
insured's automobile with the named insured's
permission . . . .
Id. at 185.
noted, the parties concede that the Connor vehicle is subject
to the “Deemer” Statute. Accordingly,
plaintiff's status as a passenger or occupant in the
Connor vehicle demonstrates that she was “occupying . .
. a named insured's automobile with the named
insured's permission.” Therefore, by virtue of her
occupancy in the Connor vehicle, plaintiff is deemed to have
the right to receive PIP benefits pursuant to the provisions
of the Deemer Statute and N.J.S.A. 39:6A-4. Thus,
plaintiff's claim for non-economic damages is subject to
the verbal threshold. This is consistent with the holding in
Beaugard, 281 N.J.Super. at 171, which held: