Reardon Anderson Successful in having client dismissed from lawsuit seeking over $350,000 in damages

Reardon Anderson was successful in having its insurance company client and their third-party administrator dismissed from a subrogation action in which the plaintiff was seeking monetary damages in excess of $350,000.  In this matter, Reardon Anderson’s client had issued a Non-trucking Liability policy to a trucking company.  In the underlying case, a driver operating a tractor and trailer owned by the trucking company struck a personal automobile.  As a result of the accident, the occupant in the personal automobile claimed neck and back injuries resulting in a fusion.  The insurer of the personal automobile paid $250,000 in PIP benefits to their insured and $100,000 for uninsured motorist coverage.  Upon the conclusion of the underlying personal injury claim by its insured, the insurer of the personal automobile filed suit against our insurance company (and third-party administrator) client that issued the NTL policy and the insurance company which had issued a commercial auto policy to the trucking company, seeking reimbursement for those funds it had expended.

During this case, it was argued that at the time of the accident, the driver of the truck was under dispatch.  Accordingly, under the NTL policy, no coverage was available.  Interestingly, the principal for the trucking company claimed that the driver of the truck was not authorized to use his trucks as he had never heard of the driver before this accident.  Ultimately, the court granted Reardon Anderson’s summary judgment motion filed on behalf of the insurance company which issued the NTL policy and that company’s third-party administrator.

— Erik Anderson, Esq.

Reardon Anderson is a Tinton Falls, New Jersey based law firm which represents the interests of businesses, insurance companies and individuals throughout New Jersey and the metropolitan New York City area. Please visit our website at http://reardonanderson.com to learn more about our firm.

Gov. Christie Signs Law Giving Injured Persons Priority Over PIP Carriers

Governor Chris Christie has signed S-191 which amends the Personal Injury Protection statute (N.J.S.A. 39:6A-9.1(b)) to provide that a injured party must be made whole prior to a PIP carrier seeking recovery from an at fault party’s insurer.  As previously reported in our blog, the proposed law passed both houses of the legislature without opposition.  The newly amended law provides that “any recovery by an insurer, health maintenance organization or governmental agency…shall be subject to any claim against the insured tortfeasor’s insurer by the injured party and shall be paid on after satisfaction of that claim, up to the limits of the insured tortfeasor’s motor vehicle or other liability policy.”

The amended law nullifies the Supreme Court’s decision in Fernandez v. Nationwide which held that it was proper to give priority to a carrier seeking to be reimbursed for PIP benefits it had paid out even if it reduced the amount of money which could be recovered by an injured party.

— Erik Anderson, Esq.

Reardon Anderson is a Tinton Falls, New Jersey based law firm which represents the interests of businesses, insurance companies and individuals throughout New Jersey and the metropolitan New York City area. Please visit our website at http://reardonanderson.com to learn more about our firm.

Court Holds that Two Year Statute of Limitations for PIP Reimbursement Claim Begins to Run Upon the Filing of a PIP Claim Form

In an unreported Appellate Division decision, the court held that the two-year Statute of Limitations for a PIP reimbursement claim is triggered upon the submission of the PIP claim form.

N.J.S.A. 39:6A-9.1 states “an insurer… paying [PIP] benefits… or medical expense benefits … as a result of an accident occurring within this State, shall, within two years of the filing of the claim, have the right to recover the amount of payments from any tortfeasor who was not, at the time of the accident, required to maintain [PIP] protection or medical expense coverage at the time of the accident.”

On December 1, 2006, Garrison Lange was injured in an automobile accident when his vehicle was struck by a vehicle owned by Holger Trucking Company.  That day, Lange contacted his automobile insurer, New Jersey Manufacturers Insurance Group (NJM) advising of the accident and claiming he had sustained neck and back injuries.  That day, NJM created a PIP file and assigned a file number.

On December 4, 2006, the NJM adjuster mailed Lange a PIP application.  That day, Lange treated with Dr. Palluzzi.  On December 6, 2006, Dr. Palluzzi submitted bills to NJM for treatment.  On December 8, 2006, NJM received the bills.  Also on December 8, 2006, Dr. Palluzzi sent NJM a letter of medical necessity and requesting approval for a one-month treatment plan.  NJM authorized the treatment plan on December 11, 2006.

On December 20, 2006, Lange sent NJM a completed PIP application which NJM received on December 26, 2006.  It was not until December 24, 2008, that NJM filed its complaint against Holger and ARI seeking reimbursement of approximately $53,000 in PIP benefits NJM paid on Lange’s behalf.

Holger and ARI moved for Summary Judgment alleging that NJM’s suit was filed more than two years after Lange first advised NJM of the accident and more than two years after NJM opened its PIP  file.   NJM argued that the suit was timely filed because it did not receive Lange’s formal PIP application until December 26, 2006.  The trial court agreed with NJM and denied defendant’s motion.  On appeal, the Appellate Division noted that the statute does not define what is meant by “the claim.”  The court focused on the Legislatures’ use of the definite article in reference to the submission of “the claim” as the event triggering the running of the statute of limitations.  Accordingly, the court found that the Legislature likely intended to mean a single, definitive event and not any of a series of events in defining “the claim.”  The court also noted the very nature of the undertaking, (i.e., the fixing of the moment upon which the limitations period begins to run) suggests a need to provide the parties with a clear and unambiguous understanding of which of any number of occurrences is the triggering event for the statute of limitations.  The court placed significant emphasis on the fact that the Legislature described that event as the filing of “the claim” and not “a claim.”

The court then examined whether “the claim” meant the first claim (the initial telephone call); the last claim (last request for payment from a health care provider) or “the claim that is different from all others, namely, the insured’s PIP application.”  In focusing on the Legislature’s intent to fix one particular, distinguishable event as the trigger for the limitations period, the court concluded that the submission of the PIP claim form triggers the two-year Statute of Limitations.

What is interesting about the decision is that the court noted, “We are concerned by the fact – as the parties recognize – that the policy in question and perhaps others like it, do not require that an insured ever submit a PIP claim form; nor do the no fault laws compel such a filing.  As a result, the event we assume to be the triggering event for the time within which a reimbursement suit must be commenced may be something that, in many cases, may never occur.” The court then noted that “we take comfort in knowing that the Legislature is fully capable of correcting the statute’s ambiguity if it believes we have erroneously interpreted the statute.”

— Tom Reardon, Esq.

Reardon Anderson is a Tinton Falls, New Jersey based law firm which represents the interests of businesses, insurance companies and individuals throughout New Jersey and the metropolitan New York City area. Please visit our website at http://reardonanderson.com to learn more about our firm.

NJ Court Finds that a Church Van Is Not An Automobile for PIP Purposes

The Appellate Division has ruled that a multi-passenger van owned by a church and utilized to transport members to and from services is not an “automobile” for the purpose of recovering PIP benefits.

In this matter, Jose Perez was involved in an accident on April 3, 2009, while driving a fifteen person van owned by Iglesia Pentecostal Roca de Salvacion. At the time of the accident, Perez was driving member of his family and several other church members to services. Perez has been driving the van for the church for the past ten years. The van was insured under a commercial policy issued by Farmers Mutual. This policy did not provide PIP coverage. Perez had a personal automobile policy issued by Encompass Property and Casualty Insurance Company. This policy provided PIP coverage, but was only applicable to “bodily injury…caused by an accident arising out of the ownership, maintenance or use…of an auto as an automobile.”

As a result of the accident, the Perez family sought PIP benefits from Farmers and Encompass. Both insurers disclaimed coverage for PIP benefits. The Perezes brought a declaratory judgment action for a determination that the Farmers and Encompass policies both provided coverage for PIP benefits for the injuries sustained. The trial court determined that the van was an “automobile” under N.J.S.A. 39:6A-2 and Encompass was required to provide PIP benefits. The court further found that as Farmers issued a commercial policy, they were not required to provide PIP benefits.

On appeal, the court was required to determine whether the church van was an “automobile” under the No Fault Law. The court noted that if the van was determined to be an automobile under the law, Encompass and Farmers would be required to pay PIP benefits to the Perezes.

The court noted that N.J.S.A. 39:6A-4 provides that “every standard automobile liability insurance policy…shall contain [PIP] benefits…to the named insured and members of his family residing in his household who sustain bodily injury as a result of an accident while occupying…or using an automobile,…and to other persons sustaining bodily injury while occupying…or using the automobile of the named insured, with permission of the named insured.” Additionally, the law provides that if a policy does not conform to these requirements, it will be “deemed to be conformed with this statute.”

The definition of “automobile” under New Jersey law sets forth two categories of motor vehicles for which, subject to certain exclusions, coverage for PIP benefits are required. These categories are: (1) private passenger automobiles or station wagon type that is owned or hired and is neither used as a public or livery conveyance for passengers or rented to others with a driver; and (2) various other types of motor vehicles, including vans, owned by an individual or by a husband and wife who are residents of the same household and not regularly used in the occupation, profession or business of the insured.

In determining whether the van was to be considered an automobile, the court noted a prior decision finding that a ‘minivan” was deemed to be an automobile for the purposes of determining whether PIP benefits were available. In that case, the court found that the “minivan” was a “station wagon type” vehicle under the law, and as such the insurer owed PIP benefits.

The Appellate Division found that the church van was completely different as it had five rows of seats and was designed to carry fifteen passengers. It further noted that this type of van was more commonly used by hotels and business to transport customers. Accordingly, the court determined that the church van was not a private passenger automobile or “station wagon type” vehicle.

As such the court looked to the second definition of “automobile” under the No Fault Law and found that the vehicle was a “van”. Next, the court was required to determine if the van was “owned by an individual or by a husband and wife who are residents of the same household.” As the van was owned by the church and not the Perzes, the court found that the van did not satisfy this element of the definition of “automobile.” Accordingly, the court found that the Farmers and Encompass policies policy did not owe PIP benefits as the church van is not an “automobile” under the No Fault Law.

— Erik Anderson, Esq.

Reardon Anderson represents the interests of businesses, insurance companies and individuals throughout New Jersey and the metropolitan New York City area. Please visit our website at http://reardonanderson.com to learn more about our firm.

Owner of Chiropractic Center Sentenced to 3 Years in Prison

On November 22, 2010, the former owner and President of Spinal Care & Rehabilitation Center located in Rahway, New Jersey was sentenced to 37 months in federal prison. In April 2010, Roberto Castanon pled guilty to mail fraud and admitted to organizing a scheme to defraud auto insurance companies. The scheme, which lasted from January 2003 through February 2007, consisted of Castanon recruiting individuals to stage automobile accidents and then referring those individuals to his Center for medical treatment. Additionally, he coached these individuals on how to fake injuries to obtain unnecessary medical treatment. Bills for the treatment rendered to these individuals were then submitted by Castanon to insurance companies for payment.

Castanon admitted that this scheme resulted in more than $400,000 in losses to insurance companies. In addition to his prison sentence, Castanon was ordered to pay $341,688.94 in restitution. Additionally, two co-conspirators have pled guilty to mail fraud, sentenced to prison terms and ordered to pay restitution.

See the United State Attorney’s press release regarding Castanon’s sentencing here….http://bit.ly/dNiCo0

— Erik Anderson, Esq.

Reardon Anderson represents the interests of businesses, insurance companies and individuals throughout New Jersey and the metropolitan New York City area. Please visit our website at http://reardonanderson.com to learn more about our firm.