Whitaker v. DeVilla

• Decision Date: 03 February 1997
• Docket Number: Nos. 1-10,s. 1-10
• Citation: 147 N.J. 341,687 A.2d 738
• Parties: Louis Scott WHITAKER and Laura Whitaker, his wife, Plaintiffs-Respondents and Cross-Appellants, v. Ronald A. DeVILLA, Romeo A. DeVilla, Defendants-Appellants and Cross-Respondents, and John Doe(fictitious persons) and ABC Corp.(fictitious entities), Defendants, and Attorney General of New Jersey, Intervenor-Appellant and Cross-Respondent.
• Court: New Jersey Supreme Court

Page 341

147 N.J. 341

687 A.2d 738

Louis Scott WHITAKER and Laura Whitaker, his wife Plaintiffs-Respondents and Cross-Appellants, v. Ronald A. DeVILLA, Romeo A. DeVilla, Defendants-Appellants and Cross-Respondents and John Doe Nos. 1-10 (fictitious persons) and ABC Corp. Nos 1-10 (fictitious entities), Defendants and Attorney General of New Jersey, Intervenor-Appellant and Cross-Respondent.

Supreme Court of New Jersey.

Argued Nov. 18, 1996.

Decided Feb. 3, 1997.

Karen L. Suter, Deputy Attorney General, for intervenor-appellant and cross-respondent, Attorney General of New Jersey (Peter G. Verniero, Attorney General, attorney; Joseph L. Yannotti, Assistant Attorney General, of counsel; Carla D. Williams, Deputy Attorney General, on the briefs).

Michael D. Blythe, Morristown, for appellants and cross-respondents Ronald A. DeVilla and Romeo A. DeVilla (Michael D. Blythe & Associates, attorneys; Lisa A. Miller, Trenton, on the briefs).

Eugene M. Purcell, Bedminster, for respondents and cross-appellants Louis Scott Whitaker and Laura Whitaker, etc. (Purcell, Ries, Shannon, Mulcahy & O'Neill, attorneys; Mr. Purcell and Kathleen J. Devlin, New Brunswick, on the briefs).

Thomas P. Weidner, Princeton, for amicus curiae, State Farm Indemnity Company (Jamieson, Moore, Peskin & Spicer, attorneys; Mr. Weidner and Ross A. Lewin, of counsel; Mr. Weidner, Ross A. Lewin and Michael G. Petrone, on the brief).

The opinion of the Court was delivered by

STEIN, J.

The critical issues in this appeal concern the proper interpretation, as well as the constitutionality, of N.J.S.A. 17:28-1.4, New Jersey's so-called "deemer" statute. That statute deems New Jersey's "verbal threshold," which allows automobile accident tort recovery for non-economic losses only for bodily injury of a type or degree within one of the nine defined categories set forth in N.J.S.A. 39:6A-8a, to apply to the policies of out-of-state residents using their automobiles in New Jersey if their insurers are authorized to do business in New Jersey. A secondary issue, assuming that the deemer statute is constitutional and applies to plaintiffs' claim, is whether the injuries sustained by plaintiff Louis Whitaker satisfy the verbal threshold.

In a reported opinion, 287 N.J.Super. 370, 671 A.2d 163 (1996), the Appellate Division agreed with the trial court that plaintiff's injuries did not satisfy the requirements of the verbal threshold. Id. at 372, 671 A.2d 163. However, the Appellate Division reversed the trial court's grant of summary judgment and remanded for further proceedings, concluding that the language of the deemer statute inadvertently was overbroad and was not intended to restrict plaintiff's right to recover for non-economic damages. Id. at 374, 671 A.2d 163. The Appellate Division declined to address the constitutionality of the deemer statute as applied to plaintiff. Id. at 373, 671 A.2d 163.

We granted the State's and defendants' petition for certification, and plaintiffs' cross-petition challenging both the constitutionality of the deemer statute and the lower courts' conclusion that plaintiff's injuries did not satisfy the verbal threshold. 145 N.J. 373, 678 A.2d 714 (1996). We reverse.

I

On June 29, 1992, plaintiff stopped his automobile behind a car making a left turn from the eastbound lane of Route 518 in Montgomery Township, a Somerset County municipality. Defendant Ronald DeVilla was driving a vehicle owned by defendant Romeo DeVilla eastbound on Route 518. That automobile collided with the rear of plaintiff's automobile.

Plaintiff and his wife reside in Pennsylvania and are insured under a Pennsylvania automobile insurance policy issued by Prudential Property and Casualty Insurance Company, an insurer authorized to do business in New Jersey. Pursuant to Pennsylvania law, which requires automobile insurance companies to provide both "full tort" and verbal threshold options, 75 Pa. Cons.Stat. Ann. § 1705(a)(1), plaintiff elected the full tort option in his automobile insurance policy.

As a result of the accident plaintiff experienced stiffness in his shoulders, neck, and back, causing him to miss seventeen hours of work during the week following the accident. He was treated initially with pain medication and a cervical collar. On the advice of an orthopedist plaintiff received physical therapy treatments from June to August of 1992. From October 1992 to November 1993, plaintiff was seen regularly by Dr. Daniel Brainum, a chiropractor. He determined that plaintiff's cervical range of motion was restricted, and that plaintiff experienced muscle spasms in the cervical, dorsal, and lumbar regions. He concluded that plaintiff's injuries were attributable to lumbosacral sprain/strain, sacroiliac instability, cervical myofascitis, and cervical hypo- He described plaintiff's condition as permanent, observing that his long-term prognosis was good with proper care. Plaintiff's last visit with Dr. Brainum occurred in November 1993.

When plaintiff was deposed in August 1994, he complained of back pain after physical exertion, and back and neck stiffness after driving for extended periods. He acknowledged that there were no activities that he engaged in prior to the accident in which he was then unable to engage, but noted that he experienced pain and discomfort when engaging in heavy lifting, or in other specific activities such as waterskiing, snow skiing, and digging holes. Plaintiff stated his intention to participate in a basketball league beginning in October 1994.

In opposition to defendants' motion for summary judgment, plaintiff relied on Dr. Brainum's final report and on the October 1994 report of plaintiff's experts, Drs. William Tevlin and David Meyers. That report, based on an examination in September 1994, indicated that plaintiff continued to experience tenderness and muscle spasm in the posterior cervical musculature and in the lumbar area, that plaintiff has decreased flexion in the head, decreased extension during bending and twisting, and decreased ability to raise his legs. The report concluded that the prognosis for plaintiff's improvement was limited because his injuries "are precursors to progressive traumatic arthritis in the areas injured."

The trial court granted defendants' motion for summary judgment, determining that the deemer statute applied to plaintiff's suit and upholding the statute's constitutionality, citing Taylor-Segan v. Rajagopal, 275 N.J.Super. 286, 645 A.2d 1272 (App.Div.1994). The court also concluded that plaintiff had not adequately supported a claim for relief under the verbal threshold, observing that plaintiff relied primarily on the report of his experts rather than on the determination of his treating physician, and noting that the medical experts' finding that plaintiff's injuries were permanent was inadequately supported by the record.

The Appellate Division agreed with the trial court's conclusion that plaintiff had failed to satisfy the verbal threshold. 287 N.J.Super. at 372, 671 A.2d 163. Nevertheless, the panel reversed the trial court's grant of summary judgment, concluding that the language in the deemer statute was "inadvertently overbroad and was not intended to restrict the rights of persons such as the present plaintiffs." Id. at 374, 671 A.2d 163. The court observed:

There is no basis shown in the present case to distinguish between a New Jersey resident who pays a New Jersey insurance company for "no threshold" coverage and an out-of-state resident who opts for substantially the same coverage with the same insurance company.

In any event, the result would be anomalous. Consider next-door neighbors living just over the border in a contiguous state. One pays for "no threshold" coverage with an insurance company authorized to do business in New Jersey, while his neighbor obtains his insurance from a company not so authorized, and does not pay for the greater coverage. If the Deemer provision is interpreted as applying to the first, he cannot recover for non-economic damages if he is injured in an automobile accident occurring here, but his neighbor, who has not paid the greater premium can recover non-economic loss without regard to the verbal threshold. We can not attribute so absurd and unnecessary an intention to our Legislature, particularly where the New Jersey authorized insurance company can probably control the optional premium for the "no threshold" coverage just as easily as it does with a New Jersey resident.

[Ibid.]

II

The deemer statute, first enacted in 1985, L. 1985, c. 520, § 18, and subsequently amended in 1988, L. 1988, c. 119, § 1 (codified as amended at N.J.S.A. 17:28-1.4), provides as follows:

Any insurer authorized to transact or transacting automobile or motor vehicle insurance business in this State, or controlling or controlled by, or under common control by, or with, an insurer authorized to transact or transacting insurance business in this State, which sells a policy providing automobile or motor vehicle liability insurance coverage, or any similar coverage, in any other state or in any province of Canada, shall include in each policy coverage to satisfy at least the liability insurance requirements of section 1 of [687 A.2d 742] P.L.1972, c. 197 (C. 39:6B-1) or section 3 of P.L.1972, c. 70 (C. 39:6A-3), the uninsured motorist insurance requirements of subsection a. of section 2 of P.L.1968, c. 385 (C. 17:28-1.1), and personal injury protection benefits coverage pursuant to section 4 of P.L.1972, c. 70 (C. 39:6A-4) or of section 19 of P.L.1983, c. 362 (C. 17:28-1.3), whenever the automobile or motor vehicle insured under the policy is used or operated in this State.

Any liability insurance policy subject to this section shall be construed as providing the coverage required herein, and any named insured, and any immediate family member as defined in section 14.1 of P.L.1983, c. 362 (C. 39:6A-8.1), under that policy, shall be subject...