GEICO INSURANCE COMPANY, Individually, and as Subrogee of JOSEPH VALENTE and/or NICOLE VALENTE, Plaintiffs–Respondents, v. JUAN CASTRO and ALEXANDER CASTRO, Defendants, ACCESS GENERAL INSURANCE COMPANY, Defendant–Appellant.
The issue presented by this appeal is whether an insurer seeking reimbursement for personal injury protection (PIP) benefits pursuant to N.J.S.A. 39:6A–9.1, is an “injured person” for purposes of the tortfeasor's split limit policy. Our answer is no.
The parties' insureds were involved in a car accident in Toms River. GEICO Insurance Company (GEICO) insured the driver of a private passenger automobile allegedly struck by a car registered in Pennsylvania and insured by Access General Insurance Company (Access General). Access General is not authorized to sell insurance in New Jersey and does not participate in New Jersey's no-fault system. See Gov't Emps. Ins. Co. v. Allstate Ins. Co., 358 N.J.Super. 555, 560, 577 (App.Div.2003). GEICO's insured sued the tortfeasor in Superior Court and settled for the $15,000 per person limit of his $15,000/$30,000 split limit policy. GEICO paid PIP benefits of $10,440.45 on behalf of its insured and sued Access General for reimbursement of those payments pursuant to N.J.S.A. 39:6A–9.1b.1 See State Farm Mut. Auto. Ins. Co. v. Licensed Beverage Ins. Exch., 146 N.J. 1, 10 (1996).
Access General moved for summary judgment dismissing GEICO's complaint pursuant to N.J.S.A. 39:6A–9.1b. Although acknowledging that it was potentially liable for PIP reimbursement as a non-PIP insurer, Access General argued that it had exhausted the limits of its policy by its payment to GEICO's insured, thus precluding recovery by GEICO on its reimbursement claim. GEICO cross-moved for summary judgment, arguing, as it does on appeal, that it is a separate “injured person” for purposes of the tortfeasor's split limit policy.2 Reasoning that GEICO's claim is separate and distinct from its insured's, not dependent on principles of subrogation, the judge deemed GEICO a “separate injured person” under Access General's policy, permitting it to recoup the PIP benefits it paid to its insured from Access General's $30,000 aggregate limits. This appeal followed.
As the parties agreed on the material facts for purposes of the motions, our task is limited to determining whether the trial court's ruling on the law was correct. Atl. Mut. Ins. Co. v. Hillside Bottling, Inc., 387 N.J.Super. 224, 230–31 (App.Div..), certif. denied, 189 N.J. 104 (2006). Because a trial court enjoys no advantage in discerning the law, as it does in discerning the facts, we owe no deference to the “trial court's interpretation of the law and the legal consequences that flow from established facts.” Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).
Access General issued the tortfeasor a $15,000 “per person” and $30,000 “per accident” split limit policy pursuant to Pennsylvania law. The “limit of liability” provision of the policy provides:
The limit of liability shown in the Schedule or in the Declarations for each person for Bodily Injury Liability is our maximum limit of liability for all damages including damages for care, loss of service or death, arising out of bodily injury sustained by any one person in any one auto accident. Subject to this limit for each person, the limit of liability shown in the Schedule or in the Declarations for each accident for Bodily Injury Liability is our maximum limit of liability for all damages for bodily injury resulting from any one auto accident․ This is the most we will pay regardless of the number of:
2. Claims made;
3. Vehicles or premiums shown in the
4. Vehicles involved in the auto accident.
GEICO argues that because N.J.S.A. 39:6A–9.1 gives PIP carriers a direct right of recovery against non-PIP insurers, “New Jersey's liability insurance requirements, to which [Access General's] policy conforms, treat GEICO as a separate ‘injured person,’ ” for purposes of PIP reimbursement. We disagree.
We explained the history and genesis of N.J.S.A. 39:6A–9.1 in IFA Insurance Company v. Waitt, 270 N.J.Super. 621, 623–27 (App.Div.), certif. denied, 136 N.J. 295 (1994). We do not repeat that history here. We note only that it has been long established that PIP reimbursement is capped at the non-PIP insurer's policy limits. Id. at 626. The Legislature made that limitation express in its 2011 amendment to N.J.S.A. 39:6A–9.1, allowing PIP reimbursement only after the tortfeasor's insurer satisfies the injured party's claim. See L. 2011, c. 11, § 1.
Under Access General's split limit policy, the limit of liability for bodily injury for any one person is $15,000. Insurance policies are, of course, subject to special rules of interpretation “to the end that coverage is afforded ‘to the full extent that any fair interpretation will allow.’ ” Longobardi v. Chubb Ins. Co., 121 N.J. 530, 537 (1990) (quoting Kievit v. Loyal Protective Life Ins. Co., 34 N.J. 475, 482 (1961)). “Notwithstanding that premise, ․ in the absence of an ambiguity, a court should not engage in a strained construction to support the imposition of liability.” Ibid.
It is difficult to imagine a more strained construction of words of an insurance policy than the one GEICO posits here. Under GEICO's reading of the Access General policy, GEICO is a person who sustained damages arising out of “bodily injury,” a defined term meaning “bodily harm, sickness or disease, including death that results,” suffered in its insured's car accident in Toms River. While GEICO argues that “person” commonly includes corporations in addition to natural persons, it offers no explanation of how the corporation might have suffered bodily injuries in the accident. Instead, GEICO claims that because New Jersey law gives PIP insurers an “entirely separate right” against the non-PIP insurer, it must be considered “a separate injured person from its insured.” We disagree that the statute allows, much less requires, such a result.
GEICO's argument is based on a faulty premise that because its reimbursement claim is not dependent on principles of subrogation, it is entirely independent of the claim of its insured. That is obviously incorrect as GEICO's claim owes its existence to its insured's claim for bodily injury suffered in the accident and is measured by whether its PIP payments were reasonable and necessary. See Waitt, supra, 270 N.J.Super. at 623.
GEICO's claim for PIP reimbursement is dependent on its insured's claim of bodily injury suffered in the accident in the same manner that wrongful death and survival claims are dependent on the deceased's claim and a per quod claim is dependent on the claim of the injured spouse. In Galante v. May, 364 N.J.Super. 284, 293 (App.Div.2003), we held that both wrongful death and survival claims arising out of a decedent's death in a car accident are subject to the same “per person” liability limit. We based our holding on the general rule that “under [insurance] policies fixing a maximum recovery for bodily injury to one person, the limitation is applicable to all claims of damage flowing from such bodily injury, and it is therefore, immaterial that some part of the damages may be claimed by a person other than the one suffering the bodily injuries.” Id. at 289 (quoting Williams v. State Farm Mut. Auto. Ins. Co., 99 N.J.Super. 377, 380 (Law Div.1968) (considering a per quod claim), aff'd, 104 N.J.Super. 403 (App.Div.), aff'd, 54 N.J. 580 (1969)).
That GEICO's claim for PIP reimbursement is one distinct from its insured's claim against the tortfeasor is not dispositive of whether both claims are subject to the same “per person” liability limit of Access General's policy. The same is obviously true of wrongful death and survival claims. Yet the Supreme Court has held that “[n]otwithstanding the distinct nature of [such] claims, the Galante panel concluded, as we do here, that a wrongful death action and survivor action trigger a single ‘per person’ limit in these circumstances.” Vassiliu v. Daimler Chrysler Corp., 178 N.J. 286, 294 (2004). The Court reasoned that “the ‘person’ referenced in [the tortfeasor's] liability policy is the decedent in this case, not the decedent's estate or his heirs as reflected in plaintiff's survival and wrongful death actions. Because the policy limits liability ‘for all damages ․ arising out of bodily injury to one person,’ the total coverage is $15,000, the single ‘per person’ limit.” Id. at 293.
General Access's policy similarly limits liability for “all damages ․ arising out of bodily injury sustained by any one person in any one auto accident.” As the only person injured in this accident was GEICO's insured, we reject GEICO's assertion that its statutory entitlement to PIP reimbursement renders it a separate injured person for purposes of Access General's split limit policy. Because Access General's payment to GEICO's insured exhausted the per person limit of Access General's policy, GEICO is not entitled to reimbursement for its PIP payments pursuant to the express terms of N.J.S.A. 39:6A–9.1b.
1. FN1. N.J.S.A. 39:6A–9.1 provides, in pertinent part thata. An insurer ․ paying ․ [PIP] benefits ․ as a result of an accident occurring within this State, shall ․ 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] ․ coverage ․b. In the case of an accident ․ involving an insured tortfeasor, the determination as to whether an insurer ․ is legally entitled to recover the amount of payments and the amount of recovery, ․ shall be made against the insurer of the tortfeasor, and shall be by agreement of the involved parties or, upon failing to agree, by arbitration. Any recovery by an insurer ․ pursuant to this subsection shall be subject to any claim against the insured tortfeasor's insurer by the injured party and shall be paid only after satisfaction of that claim, up to the limits of the insured tortfeasor's motor vehicle ․ liability insurance policy.
2. FN2. The cross-motion was one to compel arbitration that the court, with the consent of the parties, treated as one for summary judgment on the policy issue.