New Jersey Insurance law attorney Jared E. Stolz comments on Haines v. Taft
A recent case of the New Jersey Supreme Court reviews the legislative intent behind the New Jersey no-fault car insurance scheme. Insurance lawyer Jared Elliott Stolz explains in a new article.
The New Jersey Supreme Court addressed the following question of law in Haines v. Taft: "Did the Legislature intend to deviate from its highly regulated no-fault system of first-party self-insurance to cover medical expenses arising from automobile accidents when it amended the statutory scheme to allow an insured to elect smaller amounts of personal injury protection (PIP) under a standard policy?"
"Each plaintiff in this appeal was injured in a car accident. Each was insured under a standard policy with insurance that provided for $15,000 in PIP coverage instead of the default amount of $250,000. Neither plaintiff was able to sustain a claim for bodily injury (noneconomic loss) due to each policy's limitation-on-
Appellate court held "that plaintiffs could introduce evidence of their outstanding medical bills in excess of the elected PIP policy coverage in support of fault-based claims for economic damages against their respective tortfeasors."
Plaintiffs argued that plain reading of the statute clearly allowed evidence of outstanding medical bills. N.J.S.A. 39:6A-12 provides that "[n]othing in this section shall be construed to limit the right of recovery, against the tortfeasor, of uncompensated economic loss sustained by the injured party." Then N.J.S.A. 39:6A-2(k) defines "economic loss" as "uncompensated loss of income or property, or other uncompensated expenses, including, but not limited to, medical expenses."
The Court, however, did not agree that the statutory interpretation was so clear cut. "At the outset, one must recognize that Section 12 addresses evidence that is admissible or not in a claim for bodily injury. The first paragraph sets that stage for the section. And, as is universally understood, authorization to bring claims for bodily injury under our regulated system of motor vehicle insurance law is heavily circumscribed. Indeed, in this matter, both plaintiffs had the limitation-on-
The Court concluded that there is an ambiguity in the statute with respect to this issue and turned to legislative intent behind the New Jersey's no-fault car insurance scheme. After an in-depth discussion of the history of the no-fault system in New Jersey, the Court noted that the most recent amendment sought "to preserve the no-fault system, while at the same time reducing unnecessary costs which drive premiums higher." The higher premium was attributed "to medical benefits, which were 'overutilized for the purpose of gaining standing to sue for pain and suffering.'"
Therefore, the Court concluded that the evidence should have been excluded and reversed the decision of the Appellate Division. The case is Haines v. Taft, (A-13/14-17)
*** Jared Elliott Stolz is an attorney in New Jersey, focusing on insurance law and litigation. He is the managing partner of Stolz and Associates.
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