Guerline Felix v. Brian v. Richards (081799) (Essex County & Statewide)
226 A.3d 937
N.J.2020Background
- Collision in Newark: Guerline Felix (FL-insured by GEICO) struck Brian Richards (NJ-insured by AAA). Richards’ NJ policy had BI and UM/UIM limits of $15,000/$30,000; GEICO’s Florida policy had no BI liability.
- AAA sought a declaration that under New Jersey’s "deemer" statute (N.J.S.A. 17:28-1.4) GEICO’s out-of-state policy is deemed to include $15,000/$30,000 BI, thereby eliminating AAA’s UM/UIM exposure.
- GEICO argued the 1998 AICRA creation of a "basic" policy (which may carry no BI) meant the deemer statute now incorporates the basic-policy BI floor, so out-of-state policies need not provide BI.
- Trial court and Appellate Division held the deemer statute still requires out-of-state policies (for insurers like GEICO that write in NJ) to satisfy the standard BI minimum $15,000/$30,000; AAA was entitled to summary judgment.
- GEICO also argued the deemer statute, as applied, violated the Equal Protection Clause; the New Jersey Supreme Court reviewed statutory construction and the constitutional claim on certification.
Issues
| Issue | GEICO's Argument | AAA's Argument | Held |
|---|---|---|---|
| Whether the deemer statute requires out-of-state policies by insurers who write in NJ to be deemed to include NJ standard BI ($15,000/$30,000), or whether the 1998 basic policy (which can carry no BI) governs | The deemer statute incorporates by reference N.J.S.A. 39:6A-3’s post-AICRA language ("except as provided by 39:6A-3.1"), so out-of-state policies need only meet the basic-policy floor (potentially zero BI) | The deemer statute’s plain text (including express insertion of "subsection a" of 39:6B-1) requires out-of-state policies to satisfy the compulsory BI minimum of $15,000/$30,000; the Legislature knew how to reference the basic policy but did not do so in the second sentence | The deemer statute’s second sentence does not incorporate the basic-policy BI floor; insurers like GEICO remain subject to the $15,000/$30,000 BI obligation for out-of-state policies when the insurer is authorized in NJ |
| Whether application of the deemer statute to require reform to $15,000/$30,000 BI violates equal protection | Requiring GEICO to provide more BI for out-of-state insureds than NJ resident insureds (who may elect a basic policy with no BI) is an irrational and discriminatory classification | All insurers authorized to write in NJ are treated the same regarding the obligation to offer the statutory default minimum; insureds, not insurers, choose reduced coverage; the differential treatment of out-of-state insureds is rationally related to legitimate state interests (protecting UCJF, reducing litigation) | Rational-basis review applies; no equal protection violation. The classification is rationally related to legitimate state interests and treats insurers uniformly |
Key Cases Cited
- Caviglia v. Royal Tours of Am., 178 N.J. 460 (2004) (describing New Jersey’s compulsory automobile-insurance framework)
- Whitaker v. DeVilla, 147 N.J. 341 (1997) (explaining that out-of-state policies are "deemed" to include NJ compulsory BI when they lack required coverage)
- N.J. Mfrs. Ins. Co. v. Varjabedian, 391 N.J. Super. 253 (App. Div. 2007) (insurer’s obligation remains the statutory compulsory limits notwithstanding the insured’s election of basic policy)
- Cooper Hosp. Univ. Med. Ctr. v. Prudential Ins. Co., 378 N.J. Super. 510 (App. Div. 2005) (AICRA amendments limited regulatory relief to certain affiliates; other insurers’ deemer obligations unchanged)
- Citizens United Reciprocal Exch. v. Perez, 223 N.J. 143 (2015) (basic policy does not mandate BI like the standard policy)
- Jersey Cent. Power & Light Co. v. Melcar Utility Co., 212 N.J. 576 (2013) (statutory interpretation presumes every word has meaning; avoid surplusage)
- DiProspero v. Penn, 183 N.J. 477 (2005) (statutory construction: legislative intent is paramount)