September 20, 2017
appeal from Superior Court of New Jersey, Law Division, Essex
County, Docket No. L-5051-15.
Jeffrey A. Rizika argued the cause for appellant (Javerbaum,
Wurgaft, Hicks, Kahn, Wikstrom & Sinins, attorneys;
Jeffrey A. Rizika, of counsel and on the brief).
W. Matthews argued the cause for respondent (Soriano, Henkel,
Biehl & Matthews, attorneys; Thomas W. Matthews, on the
J. Karbasian argued the cause for amicus curiae New Jersey
Association for Justice (Law Offices of David J. Karbasian,
attorneys; David J. Karbasian, on the brief).
Judges Fuentes, Koblitz and Suter.
James and plaintiff Lurline James are husband and wife. Their
household includes their adult son plaintiff Lledon James,
who was a licensed driver at all times relevant to this
case. Lynval purchased an automobile policy from
defendant State Farm Insurance Company (State Farm) listing
his wife and son as additional insureds. Plaintiffs claim
that when Lynval purchased this policy from State Farm, he
requested the maximum Personal Injury Protection (PIP)
benefits of $250, 000, and designated PIP as primary for
medical expenses. After Lledon and his mother Lurline were
involved in a car accident, plaintiffs claimed they
discovered that the State Farm policy provided only $15, 000
in PIP coverage and designated a private health insurance
provider as the primary for PIP benefits.
filed a verified complaint and an order to show cause seeking
to reform the State Farm policy to provide the maximum $250,
000 PIP benefits. Plaintiffs argued that the insurance policy
as written was invalid because Lledon was covered by
Medicaid, not by a private health insurance carrier.
Plaintiffs also alleged that State Farm's actions were
willful, wanton, intentional, grossly negligent and in
reckless disregard of their legal rights.
Farm filed a responsive pleading in which it argued it was
immune from civil liability as a matter of law pursuant to
N.J.S.A. 17:28-1.9(a). Alternatively, State Farm claimed the
PIP benefits coverage in the policy is the coverage Lynval
requested at the time he purchased the policy. Plaintiffs
filed a motion for partial summary judgment, requesting
judicial reformation of the policy to reflect $250, 000 in
PIP coverage. State Farm cross-moved for summary judgment
relying on the immunity provided by the Legislature in
Division judge assigned to this case granted summary
judgement in favor of State Farm, finding it was immune from
liability in this case under N.J.S.A. 17:28-1.9(a). The judge
found the record indisputably showed Lynval signed the
coverage selection form that contained a $15, 000 limitation
on PIP benefits coverage and designated the health insurance
provider as primary. The motion judge also found that at the
time Lynval requested this automobile policy from State Farm,
he presented his private health insurance card and his
declarations page from his previous automobile insurance
policy with Geico, which provided coverage that "was
exactly the same as what was selected from State Farm in this
case." Finally, the judge noted that Lynval renewed the
State Farm automobile policy multiple times over a two-year
period without objection or modification.
light of these undisputed facts, the judge concluded
plaintiffs had not presented evidence that shows State
Farm's conduct in this case was willful, wanton, or
grossly negligent. The judge held State Farm did not have a
legal obligation to determine whether each member of an
insured's household is covered by private health
insurance at the time the insured signs the coverage
selection form. The motion judge granted State Farm's
cross-motion for summary judgment and dismissed
plaintiffs' verified complaint with prejudice pursuant to
the immunity provisions in N.J.S.A. 17:28-1.9(a).
appeal, plaintiffs argue the Law Division erred when it found
State Farm immune from liability under N.J.S.A. 17:28-1.9(a).
The New Jersey Association for Justice, appearing as amicus
curiae, argues that plaintiffs' policy should be reformed
to reflect the maximum PIP benefits available because State
Farm's policy violates both State administrative
regulations and the federal Medicare Secondary Payer Act. We
reject these arguments and affirm substantially for ...