JOEL SCHNEIDER, Magistrate Judge.
This matter is before the Court on the "Motion to Apply the Verbal Threshold Pursuant to the Deemer Statute" filed by defendant Susan M. Dickenson. [Doc. No. 7]. The Court received plaintiff's opposition [Doc. Nos. 11, 12] and Dickenson's reply [Doc. No. 16]. The Court exercises its discretion not to hold oral argument. Fed. R. Civ. P. 78; L. Civ. R. 78.1. For the reasons to be discussed, Dickenson's motion is granted.
On August 6, 2016, plaintiff (Pennsylvania resident) was a passenger in a vehicle driven by Kevin Connor (Pennsylvania resident) when the vehicle was involved in a motor vehicle accident in New Jersey driven by defendant Susan M. Dickenson. The Connor vehicle was registered to Connor's parents and insured by Chubb (New Jersey authorized insurer). Plaintiff is a named driver on her parents' insurance policy from Cincinnati (New Jersey authorized insurer) with limited tort option under PA law. Defendant is a New Jersey resident insured by a New Jersey insurer.
Plaintiff alleges that defendant was distracted by the use of her cell phone, causing defendant's vehicle to cross the center line, resulting in a head-on collision with the Connor vehicle. Following the accident, Chubb (Connor's insurer) denied PIP coverage to plaintiff stating: "Under an automobile policy issued in the State of Pennsylvania, Priority of Coverage is the injured person's own automobile insurance policy, a household automobile insurance policy and then possibly the involved vehicle's policy." Ex. E to Pl.'s Opp'n [Doc. No. 11-1]. Plaintiff subsequently filed a claim with her parents' Cincinnati policy which paid $10,000 in PIP medical bills, exhausting her First Party Benefits under the Cincinnati policy. Ex. G to Pl.'s Opp'n [Doc. No. 11-3].
On December 27, 2016, plaintiff filed this lawsuit. Defendant filed her answer and the present motion on February 22, 2017. [Doc. Nos. 6, 7]. The Court granted motions to intervene filed by Chubb and Cincinnati on April 7, 2017. [Doc. No. 18]. Pursuant to 28 U.S.C. § 636(c), the parties consented to the jurisdiction of this Court to hear the case. [Doc. No. 21].
New Jersey's "Deemer" Statute (N.J.S.A. 17:28-1.4) addresses the situation when non-resident motorists are involved in accidents in New Jersey. The statute requires that if a non-resident's insurer is authorized to do business in New Jersey, the insurer must provide personal insurance protection ("PIP") benefits to the non-resident. New Jersey's automobile insurance scheme allows prospective insureds to choose between two coverage options. "The first type of coverage, outlined in section 39:6A-8(a), is known as `verbal threshold' coverage, and precludes tort recovery for non-economic injuries except those that fall into six specific categories."
In determining whether the verbal threshold applies to non-resident drivers, New Jersey courts have created a two-prong test. Staub, at *3. The first prong requires an examination of whether the defendant is the owner or operator of an "automobile" and is entitled to receive no-fault PIP benefits under section 39:6A-4. The second prong focuses on whether the plaintiff is a person subject to the verbal threshold statute and is required to maintain PIP coverage, or has a right to receive PIP benefits under N.J.S.A. 39:6A-4.
Plaintiff is Subject to the Verbal Threshold by Operation of Law
The parties concede the Connor vehicle is the vehicle pertinent to the present analysis as it is subject to the "Deemer" Statute by being used in New Jersey and insured by a New Jersey authorized insurer—Chubb.
As noted, the parties concede that the Connor vehicle is subject to the "Deemer" Statute. Accordingly, plaintiff's status as a passenger or occupant in the Connor vehicle demonstrates that she was "occupying . . . a named insured's automobile with the named insured's permission." Therefore, by virtue of her occupancy in the Connor vehicle, plaintiff is deemed to have the right to receive PIP benefits pursuant to the provisions of the Deemer Statute and N.J.S.A. 39:6A-4. Thus, plaintiff's claim for non-economic damages is subject to the verbal threshold. This is consistent with the holding in
In the Alternative, Plaintiff is Subject to the Verbal Threshold through the Cincinnati Policy
Additionally, the Appellate Division held in Koff that:
The weakness in plaintiff's argument is that she does not address the interplay between N.J.S.A. 17:28-1.4, 39:6A-4 and 39:6A-8(a). In fact, plaintiff does not even discuss N.J.S.A. 39:6A-4 and N.J.S.A. 6A-8(a). Plaintiff is mistaken when she only focuses on N.J.S.A. 17:28-14 while ignoring the limited tort language in N.J.S.A. 39:6A-8(a). Since PIP coverage applies to the Connor vehicle by virtue of the Deemer statute, and plaintiff is entitled to receive PIP benefits by virtue of occupying the vehicle, defendant is exempted from tort liability to plaintiff. N.J.S.A. 39:6A-8(a).
For the reasons discussed above, defendants' motion will be granted.
Accordingly, for the foregoing reasons, it is hereby ORDERED this 10th day of August, 2017, that defendant's motion is GRANTED and it is the finding of this Court that plaintiff is subject to the verbal threshold in the Deemer Statute.