State News : New Jersey

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New Jersey



           There has been a great deal of controversy about respondent’s lien rights in motor vehicle accident cases since the unreported ruling inDever v. New Jersey Mfrs. Ins. Co., No. A-3102-11T2 (App. Div. October 23, 2013).  In one decision from last summer, an Atlantic City Superior Court Judge rejected the application of theDever rule in a similar set of facts. 

            The Atlantic City case, Colmyer v. Vicki S. Abline, Docket No. ATL-L-5766-1 (August 12, 2014), involved a car accident between plaintiff, Timothy Colmyer, and defendant, Vicki S. Abline.  The Little Egg Harbor Municipal Utilities Authority, plaintiff’s employer, paid workers’ compensation benefits and asserted a lien in the amount of $31,768.  The MUA intervened in the case to protect its lien rights underN.J.S.A. 34:15-40.  The defendant argued that N.J.S.A. 39:6A-12 bars the introduction of evidence of amounts “collectible or paid” by Personal Injury Protection.  Defendant further argued that it made no difference whether the medical expenses were paid through workers’ compensation or PIP or any other source: the statutory bar precludes evidence of such payments.

            The MUA countered that there was a double recovery in this case to the extent of its medical payments and that it was entitled to reimbursement under the statutory formula.  Superior Court Judge, Honorable Allen Littlefield, J.S.C., first examined the two statutes.  The Judge also noted that both plaintiff and defendant relied upon the unpublished decision inDever, supra.  Judge Littlefield wrote, “In Dever, the Appellate Division held that a plaintiff is statutorily precluded from recovering medical expenses from a tortfeasor where such expenses were paid by the plaintiff’s workers’ compensation carrier.” 

            Judge Littlefied next observed that Section 12 of Title 39 was adopted after Section 40 of the New Jersey Workers’ Compensation Act.  He said that the legislature was fully aware of the provisions of Section 40 when it adopted Section 12.  The logic is that the legislature could have abrogated respondent’s lien rights under Section 40 in adopting Section 12, but it did not.

            Judge Littlefield further observed that “the Appellate Division decision inLefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988) is still good law and should be followed by the Court.” The rule inLefkin is “that a plaintiff must pay the medical expense portion of a workers’ compensation lien out of his recovery from the tortfeasor defendant.”  The Court inLefkin said: 

Where only workers’ compensation benefits and PIP benefits are available, the primary burden is placed on workers’ compensation as a matter of legislative policy by way of the collateral source rule ofN.J.S.A. 39:6A-6. (citations omitted). And when only PIP benefits and tortfeasor liability are involved, the primary burden is placed as a matter of policy on the PIP carrier byN.J.S.A. 39:6A-12.

The court in Lefkin concluded that there is no bar against recovery of the medical expenses collected or collectible in workers’ compensation from the tortfeasor.  The Court reasoned as follows:

This is so because PIP benefits are not available to an insured if workers’ compensation benefits are also available to him.  Consequently, PIP benefits in that situation are neither collectible nor paid.  Hence,N.J.S.A. 39:6A-12, which bars evidence in the third-party action only of  ‘amounts collectible or paid’ under PIP coverage, is inapplicable, and there is no other impediment to the plaintiff-insured-employee recovering his medical expenses from the tortfeasor even though that recovery will ultimately be subject to the compensation lien. 

Judge Littlefield concluded, “Because MUA is entitled to recover from Plaintiff’s recovery, it logically follows that evidence of Plaintiff’s medical expenses must be admissible at trial.  If the medical bills were precluded, the compensation carrier would be unable to secure reimbursement from the Plaintiff pursuant to N.J.S.A. 34:15-40.”

There are now countless cases in New Jersey where plaintiffs who have both workers’ compensation recoveries and settlements in car accidents are refusing to reimburse medical expenses based on the theory advanced inDever.  This decision is not the final word on this subject but it shows that at least one Superior Court has flatly rejected the recent ruling inDever.