Bernick v. Aetna Life and Casualty

Citations: 386 A.2d 908; 158 N.J. Super. 574; 1978 N.J. Super. LEXIS 1336

Court: New Jersey Superior Court; April 6, 1978; New Jersey; State Appellate Court

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In the case of Rosemarie Bernick v. Aetna Life and Casualty, the Superior Court of New Jersey addressed the issue of the interplay between personal injury protection (PIP) benefits under the No Fault Law and medical expense benefits from the Workers' Compensation Act. Rosemarie Bernick sustained injuries in a car accident while working as a public health nurse for the Visiting Nurse Association, which held both PIP and workers' compensation insurance with Aetna. Following a settlement for her workers' compensation claim, Aetna asserted a lien against her for the benefits paid, totaling $1,316.55, which Bernick repaid after settling a third-party negligence lawsuit against the driver responsible for her injuries.

Bernick subsequently sought reimbursement from Aetna for her medical expenses under the PIP coverage, which Aetna denied, citing the collateral source rule of N.J.S.A. 39:6A-6. This statute requires that benefits collectible under workers' compensation must be deducted from any PIP benefits. Aetna acknowledged the reasonableness of the medical expenses but maintained that the statute mandated the deduction of any workers' compensation benefits from PIP payments. The court found that Bernick's argument for reimbursement was unpersuasive in light of the statute's clear language, which required a mandatory deduction of collectible workers' compensation benefits from PIP payments. As a result, the matter was poised for summary judgment, with Aetna's legal position supported by the statutory framework.

The statute N.J.S.A. 39:6A-6 mandates that the amount deducted from Personal Injury Protection (PIP) benefits is strictly the 'benefits collectible' under workers' compensation, with no distinction between reimbursed and unreimbursed benefits. The absence of language differentiating these types of benefits indicates that the Legislature intended for injured parties to seek compensation solely from workers' compensation carriers in such cases. Allowing recovery of both workers' compensation and PIP benefits for the same accident would contradict the statute's clear intent and undermine its framework. The use of 'shall' in the statute signifies a mandatory obligation rather than a discretionary option.

The court's analysis in Solimano v. Consolidated Mut. Ins. Co. reinforces this interpretation, establishing that while PIP carriers must pay benefits promptly, they also possess a right to deduct from those payments based on workers' compensation benefits. This deduction right is integral to the statutory scheme, and no provisions for remittance or subrogation are outlined in N.J.S.A. 39:6A-6. The court highlighted the PIP carrier's remedy of pursuing reimbursement through a compensation action in its own name when benefits are paid prior to a determination of collectibility. The precedent set in Toppi v. Prudential Ins. Co. of America supports this view, indicating that a PIP carrier cannot unilaterally deduct claimed amounts without an adjudication of collectibility from collateral sources. Instead, the PIP carrier must fulfill its payment obligations until such determinations are made.

Plaintiff's entitlement to workers' compensation benefits has been established by the Workers' Compensation Division, with her acknowledgment of this through reimbursement of the compensation lien. Consequently, her eligibility to collect workers' compensation benefits is confirmed. Mrs. Bernick's claim for Personal Injury Protection (PIP) benefits contradicts N.J.S.A. 39:6A-6 and relevant case law, as it seeks to recover medical expenses already compensated by both the workers' compensation carrier and a third-party civil action, leading to a prohibited double recovery. The plaintiff has received full compensation for her injuries and expenses, and any additional PIP benefits would result in an unjust financial advantage. 

The plaintiff contends that N.J.S.A. 39:6A-12 would bar her from recovering medical benefits paid by workers' compensation in her negligence claim, but this statute only excludes certain PIP benefits, not those from the compensation carrier. While the No Fault Act allows some duplication of payments under specific conditions, the plaintiff fails to provide legal precedent supporting her position. The case of Lapidula recognized that certain medical services were considered 'incurred' under the No Fault Law, but the distinction lies in the nature of those services as collateral sources, which do not apply to the plaintiff's situation as outlined by N.J.S.A. 39:6A-6. The ruling in Sanner reinforced the interpretation aimed at preventing double recovery, while Walkowitz related to different coverage issues and does not negate the current application of PIP benefits.

The Appellate Division determined that N.J.S.A. 17:28-1.1 et seq. mandates carriers to provide uninsured motorist coverage without any reduction for workers' compensation benefits. The statute explicitly does not allow for relief from liability benefits based solely on the availability of workers' compensation for the injured party. The No Fault Act's intent is to ensure timely payment of first-party medical expenses, with the exception that benefits from workers' compensation, temporary disability statutes, and Medicare must be deducted from Personal Injury Protection (PIP) benefits. Importantly, there is no statutory or case law exception for situations where an injured plaintiff reimburses a workers' compensation lien from a third-party settlement. The recovery of PIP benefits is barred if benefits are collectible under the specified collateral sources in N.J.S.A. 39:6A-6. Consequently, summary judgment was granted in favor of the defendant, dismissing the complaint. The validity of this statute has previously been upheld against due process challenges. The language of N.J.S.A. 39:6A-6, particularly the use of 'shall', is interpreted as mandatory, indicating that recipients of the specified collateral source benefits are exempt from PIP benefits. Courts recognize that when statutory language is clear and unambiguous, the legislative intent is discernible from the language used. The presumption is that 'shall' is imperative unless context suggests otherwise.