Robinson v. Zorn

Citations: 430 N.J. Super. 312; 64 A.3d 571; 2013 WL 1628933; 2013 N.J. Super. LEXIS 56

Court: New Jersey Superior Court Appellate Division; April 17, 2013; New Jersey; State Appellate Court

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The court, led by Judge Fasciale, affirmed the denial of the plaintiff's motion to amend his complaint to include an uninsured motorist (UM) claim against New Jersey Transit (NJT). The plaintiff, an uninsured individual from Pennsylvania, sought a ruling compelling NJT to provide UM coverage, a request deemed unauthorized under current statutory law and better suited for legislative action. The judge referenced the precedent set in Ross v. Transport of New Jersey, which established that public entities are not obligated to provide UM coverage if they do not choose to insure or self-insure, citing the public entity exemption in N.J.S.A. 39:6-54.

The Legislature's amendments in 1987 and the enactment of the special automobile insurance policy (SAIP) in 2003 were analyzed, concluding that these did not alter the Ross ruling regarding public entities' UM insurance obligations. The plaintiff, who had no vehicle access or insurance, sustained injuries while riding an NJT bus in New Jersey after an accident with another driver. Despite filing a complaint against the driver and NJT, he later discovered no insurance was available for his claims. The judge ultimately dismissed the complaint against NJT and the bus driver after determining liability solely rested with the driver, leading to an $86,668.65 judgment against the driver. The plaintiff subsequently appealed the decision.

Plaintiff asserts that the judge erred in denying his motion to amend the complaint to include a UM claim against NJT, arguing that (1) the case of Ross is not applicable due to the establishment of the SAIP; (2) denying the amendment contravenes public policy; and (3) prohibiting UM coverage against NJT violates the Privileges and Immunities Clause of the Fourteenth Amendment. Under Rule 4:9-1, motions to amend pleadings are generally granted liberally unless the amendment would be futile. The court determined that allowing the amendment for a UM claim against NJT would be futile under current law. 

In the Ross case, the court evaluated whether NJT was required to provide UM insurance for injuries from accidents involving its buses, referencing the Motor Vehicle Security Responsibility Law, which exempts state-owned motor vehicles, including those operated by public entities like NJT. Justice Handler noted that exemptions exist for public agencies within this statutory framework. He discussed the public policy implications of limiting liability for public entities while ensuring compensation for victims of uninsured motorists and protecting the Unsatisfied Claim and Judgment Fund (UCJF). Overall, the court concluded that the public policies supporting UM coverage do not conflict with the exemptions provided to public entities under the law, leading to the affirmation that the proposed amendment was legally unsustainable.

A clear declaration exists in N.J.S.A. 39:6-54's exemption clause, indicating that public policy for uninsured motorist (UM) coverage is overridden by this statutory exception. Justice Handler emphasized that if public entities were required to provide UM insurance at public expense, it should be clearly indicated by the Legislature, especially given the limitations on government liability outlined in the Tort Claims Act (TCA). The discussion also considers whether the 1987 amendment to N.J.S.A. 39:6-54a impacts the ruling in Ross. Although not directly argued by the plaintiff, it’s relevant due to the Court's indication in Ross that the amendment might influence future interpretations. The amendment suggests public entities could be liable for insurance under N.J.S.A. 39:6A and 39:6B, potentially countering arguments from Ross.

The 1987 amendment explicitly exempts certain government-owned vehicles from New Jersey’s No-Fault insurance scheme, maintaining the exemption for publicly-owned vehicles. The statute’s language, particularly the use of a semicolon, indicates a legislative intention to distinctly categorize vehicles owned by government entities from those subject to other insurance requirements. This clarification limits exemptions to vehicles under different insurance laws, reaffirming that the amendment does not change the holding in Ross. It aligns with the TCA's purpose to limit public entity liability and supports the notion that a public entity that does not procure insurance is not required to provide UM coverage.

The plaintiff argues that Ross is not applicable for two reasons: it is factually distinguishable and did not account for scenarios where uninsured out-of-state individuals might lack third-party insurance when involved in an accident with someone insured by a Special Automobile Insurance Policy (SAIP). The plaintiff distinguishes his situation from Ross by noting he lacks recourse to the Property-Liability Insurance Guaranty Association (PLIGA).

The Court in Ross, 114 N.J. at 147, 553 A.2d 12, interpreted the comprehensive insurance statutory scheme, specifically N.J.S.A. 39:6-54, to conclude that public entities are not required to provide uninsured motorist (UM) insurance coverage. Justice Handler indicated that imposing such a requirement for uninsured out-of-state individuals would necessitate clearer legislative intent to create an exception to existing government liability limitations, as represented in the Tort Claims Act (TCA). The plaintiffs' argument that the Special Automobile Insurance Policy (SAIP), under N.J.S.A. 39:6A-3.3, invalidates the Ross decision was rejected. 

In 2002, insurance reform legislation was enacted under Governor McGreevey to simplify regulatory processes and encourage insurers to operate in New Jersey. The legislative history indicates a focus on enhancing market conditions rather than altering the public entity exemption outlined in N.J.S.A. 39:6-54. The New Jersey Automobile Insurance Competition and Choice Act, introduced as Assembly Bill A.2625, emphasized the importance of a competitive insurance market for consumer benefit and did not address public entity exemptions or the treatment of out-of-state uninsured individuals in accidents involving insured drivers under SAIP. Additionally, a subsequent Senate statement regarding S.63 noted the elimination of the Uninsured Compensation Judgment Fund (UCJF) and proposed a new limited benefits policy for low-income drivers qualifying for Medicaid, which would be considered uninsured for UM coverage purposes.

On June 9, 2003, the Legislature enacted L. 2003, c. 89, which serves as the Senate Committee Substitute for Senate No. 63. The law addresses the functions of the Uninsured Motorist Claims Fund (UCJF), established by P.L. 1952, c. 174, which compensates victims of hit-and-run or uninsured vehicle accidents and reimburses insurers for medical expenses exceeding $75,000. The legislation aims to enhance efficiency by transferring the UCJF's claims administration to the Property Liability Insurance Guaranty Association (PLIGA), created by P.L. 1974, c. 17. The UCJF will retain its legal status while giving PLIGA governance over its claims and financial functions, alongside those of the New Jersey Automobile Full Insurance Underwriting Association and Market Transition Facility.

Additionally, the bill introduced the Special Automobile Insurance Policy (SAIP) under N.J.S.A. 39:6A-3.3 to assist low-income individuals, specifically those enrolled in government-subsidized programs, in meeting mandatory auto insurance requirements. The SAIP will not include liability, collision, or comprehensive coverage. The bill clarifies that an uninsured vehicle can include those insured under the SAIP but excludes vehicles owned by public entities. The reform maintains the public entities' exemption under N.J.S.A. 39:6-54, ensuring they are not required to provide uninsured motorist (UM) coverage for their vehicles. The text references the Ross case, indicating that although it did not rely on other insurances for recovery, the plaintiff lacked a recovery source through the UCJF due to the specific circumstances involving uninsured out-of-state individuals.

Justice Handler emphasized that any allowance for exceptions to the government’s liability limitations, as established by laws like the TCA, must be clearly indicated by the Legislature in the context of the Compulsory Insurance Law. The court deferred to the Legislature on whether NJT should be required to provide uninsured motorist (UM) insurance for out-of-state residents involved in accidents with NJT, indicating that current law does not support the plaintiff's claim for judicial relief. The ruling affirmed that NJT was improperly named as a defendant since it had already acquired Transport of New Jersey prior to the events in question, and the parties involved were not impacted by a 1987 amendment occurring after those events. N.J.S.A. 39:6A-3.3 allows low-income individuals to meet insurance requirements through policies with zero liability coverage. Lionelli, who defaulted, is not part of this appeal. The judge's denial of reconsideration is also being appealed. The court assessed the plaintiff's Fourteenth Amendment claim, determining it lacked merit; the absence of UM benefits in this case does not violate the right to travel. The No-Fault Act requires all automobile liability policies in New Jersey to include no-fault and UM coverage. The plaintiff in Ross, a New Jersey resident and NJT bus passenger, had a potential recovery avenue through the UCJF, aligning with the relevant statutory language.