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Superior Court Decision Refused to Follow Unreported Decision in Dever V. New Jersey Manufacturers

By on January 20, 2015 in Uncategorized with 0 Comments

There has been a great deal of controversy about respondent’s lien rights in motor vehicle accident cases since the unreported ruling in Dever 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 the Dever 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 under N.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  The Judge also noted that both plaintiff and defendant relied upon the unpublished decision in Dever, supra.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 in Lefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988) is still good law and should be followed by the Court.” The rule in Lefkin 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 in Lefkin 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 of N.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 by N.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 in Dever.  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 in Dever.

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About the Author

About the Author:

John H. Geaney, a shareholder and co-chair of Capehart Scatchard's Workers' Compensation department, began an email newsletter entitled Currents in Workers’ Compensation, ADA and FMLA in 2001 in order to keep clients and readers informed on leading developments in these three areas of law. Since that time he has written over 500 newsletter updates.

Mr. Geaney is the author of Geaney’s New Jersey Workers’ Compensation Manual for Practitioners, Adjusters & Employers. The manual is distributed by the New Jersey Institute for Continuing Legal Education (NJICLE). He also authored an ADA and FMLA manual as distributed by NJICLE. If you are interested in purchasing the manual, please contact NJICLE at 732-214-8500 or visit their website at www.njicle.com.

Mr. Geaney represents employers in the defense of workers’ compensation, ADA and FMLA matters. He is a Fellow of the College of Workers’ Compensation Lawyers of the American Bar Association and is certified by the Supreme Court of New Jersey as a workers’ compensation law attorney. He is one of two firm representatives to the National Workers’ Compensation Defense Network. He has served on the Executive Committee of Capehart Scatchard for over ten (10) years.

A graduate of Holy Cross College summa cum laude, Mr. Geaney obtained his law degree from Boston College Law School. He has been named a “Super Lawyer” by his peers and Law and Politics. He serves as Vice President of the Friends of MEND, the fundraising arm of a local charitable organization devoted to promoting affordable housing.

Capehart Scatchard is a full service law firm with offices in Mt. Laurel and Trenton, New Jersey. The firm represents employers and businesses in a wide variety of areas, including workers’ compensation, civil litigation, labor, environmental, business, estates and governmental affairs.

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