STATE OF NEW JERSEY, PLAINTIFF-APPELLANT, v. RANDI FLEISCHMAN, DEFENDANT-RESPONDENT.
Supreme Court of New Jersey.
Argued November 29, 2006-Decided March 19, 2007--Corrected March 26, 2007.
917 A.2d 722 | 189 N.J. 539
STATE OF NEW JERSEY, PLAINTIFF-APPELLANT, v. RANDI FLEISCHMAN, DEFENDANT-RESPONDENT.
Argued November 29, 2006-Decided March 19, 2007--Corrected March 26, 2007.
Gerald D. Miller, argued the cause for respondent (Miller, Meyerson, Schwartz & Corbo, attorneys; Mr. Miller and Leonard Meyerson, on the briefs).
Justice LaVECCHIA delivered the opinion of the Court.
Pursuant to the New Jersey Code of Criminal Justice (Code), one can be charged with the offense of insurance fraud for knowingly making a false or misleading statement of material fact in connection with an insurance claim.
The State indicted defendant Randi Fleischman for second-degree insurance fraud. The factual underpinnings for the charge were based on various items of false information contained in defendant‘s statements to the police and to her automobile insurer in connection with a stolen car claim. Defendant challenged the sufficiency of the evidence to support the indictment, claiming that her three statements (made when reporting to the police that her car had been stolen and when submitting an oral and then written insurance claim) сonstituted only three “acts” of insurance fraud. This appeal provides the Court with its first opportunity to construe
I.
The State presented the following facts to the grand jury. On December 4, 2003, after having made arrangements for a friend to dispose of her 2000 Chrysler Sebring, defendant contacted the Edison Police to report that her car had been stolen.1 She told the police that she arrived alone at the Menlo Park Mall at 5:30 p.m. on December 4, 2003, and subsequently discovered that her car had been stolen when she rеturned to the parking lot at 6:15 p.m.
Defendant also telephoned her automobile insurer, Liberty Mutual Insurance Company (Liberty Mutual), to report that her car had been stolen. In that conversation, Fleischman stated that she and a friend arrived at the mall at 9:00 a.m. on December 4 and discovered at 6:30 p.m. that the car had been stolen. In response to questioning about the claim, she told her insurer that she still
On December 12, 2003, defendant filed with Liberty Mutual an Automobile Theft Affidavit, in which she swore that the automobile had been stolen from the Menlo Park Mall parking lot, that she did not know the thief‘s identity, and that she had no information about the car‘s whereabouts. Fleischman‘s affidavit also stated that she did not own any other automobile and that her car had not been for sale.
Fleischman subsequently admitted that her car had not been stolen and withdrew her insurance claim.2 A Middlesex County Grand Jury indicted defendant, charging her with second-degree insurance fraud,
Defendant moved to dismiss her indictment in its entirety and, alternatively, to dismiss the second-degree insurance fraud count (Count One). The motion court found that the State presented only three acts of insurance fraud: defendant‘s fraudulent report to Liberty Mutual; the false affidavit that she submitted to Liberty Mutual; and defendant‘s fraudulent police report. Ac-
On leave to appeal granted to the State, the Appellate Division affirmed Count One‘s dismissal, holding that “[e]ach lie told in support of one fraudulent claim in a single document cannot reasonably be seen as a separate act of insurance fraud, but rather only as a component of the one fraudulent claim.” State v. Fleischman, 383 N.J. Super. 396, 405, 891 A.2d 1247 (2006). We granted leave to appeal. 187 N.J. 74, 899 A.2d 298 (2006).
II.
In 1983, the Legislature passed the Insurance Fraud Prevention Act (IFPA),
Pursuant to
knowingly makes, or causes to be made, a false, fictitious, fraudulent, or misleading statement of material fact in ... any record, bill, claim or other document, in writing, electronically, orally or in any other form, that a person attempts to submit, submits, causes to be submitted, or attempts to cause to be submitted as part of, in support of or opposition to or in connection with: (1) a claim for payment, reimbursement or other benefit pursuant to an insurance policy.... [(Emphasis added).]
The offense is elevated from the third to the second degree when a person commits five or more acts of insurance fraud and the aggregate value of “property, services or other benefits obtained
Each act of insurance fraud shall constitute an additional, separate and distinct offense, except that five or more separate acts may be aggregated for the purpose of establishing liability pursuant to this subsection. Multiple acts of insurance fraud which are contained in a single record, bill, claim, application, payment, affidavit, certification or other document shall each constitute an additional, separate and distinct offense for purposes of this subsection. [Ibid. (emphasis added).]
Thus, the breadth of the phrase “act of insuranсe fraud” for grading purposes depends, in part, on the breadth of the term “statement,” in subsection a. of the Act. We now must determine how the Legislature intended the term “statement” to be applied. The State argues that “statement” should encompass each fraudulent factual declaration within a single oral or written assertion or submission made in connection with a fraudulent claim. In contrast to that narrow reading of what should constitute a fraudulent act, defendant takes the position that “statement” should be generally coextensive with a person‘s narration or report submitted in connection with a claim.
III.
In this exercise in statutory construction, our function is to effectuate legislative intent. To accomplish that purpose we look first to the words used by the Legislature in its enactment because, if the language is clear, a court‘s role is to apply the statute consistent with the plain meaning of the legislative choice of expression. State v. Lewis, 185 N.J. 363, 369, 886 A.2d 643 (2005). We give to “statutory words their ordinary meaning and significance.” DiProspero v. Penn, 183 N.J. 477, 492, 874 A.2d 1039 (2005) (citing Lane v. Holderman, 23 N.J. 304, 313, 129 A.2d 8 (1957)). In other words, we do not “rewrite a plainly-written enactment of the Legislature [or] presume that the Legislature intended something other than that expressed by way of the plain language.” O‘Connell v. State, 171 N.J. 484, 488, 795 A.2d 857 (2002). Rather, courts are to apply a statute as it has been enacted. See In re Closing of Jamesburg High Sch., 83 N.J. 540, 548, 416 A.2d 896 (1980). However, when the statutory language is ambiguous and a fair reading of the words permits more than one reasonable interpretation, then we may turn to extrinsic interpretative aids, including legislative history and established canons of construction, for assistance in discerning the Legislature‘s intent. See DiProspero, supra, 183 N.J. at 494; Lozano v. Frank DeLuca Constr., 178 N.J. 513, 522, 842 A.2d 156 (2004).
In respect of the question before us, the State asserts that the Legislature clearly made the unit of prosecution a fraudulent “statement” and not the fraudulent “claim” by declaring that “[m]ultiple acts of insurance fraud which are contained in a single record ... shall each constitute an additional, separate and distinct offense for purposes of this subsection.”
The parties’ arguments highlight the inherent ambiguity in the Act‘s inclusion of a “false, fictitious, fraudulent, or misleading statement of material fact” as constituting an “act” of insurance fraud. That the term “statement” does not have a universal meaning permits the parties to advance their competing interpretations. Dictionaries define “statement” both as “a report or narrative” and as “a single declaration or remark.” Webster‘s Third New International Dictionary 2229 (16th ed. 1971); see also Funk & Wagnalls New Comprehensive International Dictionary 1225 (8th ed. 1978) (defining “statement” as “a summary of facts; narration; the act of stating“); Webster‘s Ninth New Collegiate Dictionary 1151 (1991) (defining “statement” as “a report of facts or opinions” and as “a single declaration or remark“).
In the criminal context, a “statement” has a variety of meanings. In criminal procedure, “statement” is commonly understood to refer to a narrative and not a single declaration, such as, for example, a criminal suspect‘s statement to police. See, e.g., State v. Cook, 179 N.J. 533, 847 A.2d 530 (2004); State v. P.Z., 152 N.J. 86, 703 A.2d 901 (1997); see also Black‘s Law Dictionary 1416 (7th ed. 1999) (defining “statement” in criminal procedure as “[a]n account of a person‘s ... knowledge of a crime“). In the context of perjury, which is a “false statement under oath,”
No definition of “statement” answers the question posed by this appeal.
The State urges that we consider the Legislature‘s strongly expressed desire to curb the rampant and expensive problem of insurance fraud by increasing the penalties for such behavior. When interpreting criminal statutes, “whatever be the rule of construction, it is subordinate to the goal of effectuating the legislative plan as it may be gathered from the enactment when read in the full light of its history, purpose and context.” Lewis, supra, 185 N.J. at 369 (quoting State v. Gill, 47 N.J. 441, 444, 221 A.2d 521 (1966) (internal quotations omitted)). The
- Insurance fraud is inimical to public safety, welfare and order within the State of New Jersey. Insurance fraud is pervasive and expensive, costing consumers and businesses millions of dollars in direct and indirect losses each year....
- The problem of insurance fraud must be confronted aggressively by facilitating the detection, investigation and prosecution of such misconduct, as well as by reducing its occurrence and аchieving deterrence through the implementation of measures that more precisely target specific conduct constituting insurance fraud.
- To enable more efficient prosecution of criminally culpable persons who knowingly commit or assist or conspire with others in committing fraud against insurance companies, it is necessary to establish a crime of “insurance fraud” to directly and comprehensively criminalize this type of harmful conduct, with substantial criminal penalties to punish wrongdoers and to appropriately deter others from such illicit activity.
[
N.J.S.A. 2C:21-4.4(a) to (c).]
The State also points to the Health Care Claims Fraud Act (HCCFA), which expresses a similar legislative intention to curb aggressivеly health care insurance fraud. In the HCCFA, the Legislature created the offense of “health care claims fraud,” which is “making, or causing to be made, a false, fictitious, fraudulent, or misleading statement of material fact in ... any record, bill, claim or other document.”
In sum, we find that those extrinsic materials are of little assistance in resolving whether discrete facts within a single narrative advanced in furtherance of a fraudulent insurance claim should be considered individual fraudulent “acts.” The legislative findings and declarations simply do not compel the interpretation that the State urges us to accept. Therefore, we turn to the established principle of statutory interpretation that the Legislature is presumed to act with knowledge of the judicial construction given to predecessor or related enactments. See Brewer v. Porch, 53 N.J. 167, 174, 249 A.2d 388 (1969).
IFPA, the predecessor to the instant criminal provision, addressed insurance fraud through the imposition of stiff civil penalties. Although civil in nature, IFPA punished the submission of a false or misleading “statement” through language essentially identical to that which now appears in thе criminal statute.
[t]he Commissioner [of Insurance] correctly asserts that each knowing and material false statement enhances a fraudulent claim, making thе danger of payment more likely. Insurers often require a claimant to file several documents as supporting proof of a claim for benefits. Claimants frequently must present a “proof of loss” in the form of a detailed factual statement or statements to justify claims for benefits. Each additional statement further supports the credibility of the claim. Therefore, a claimant who makes a fraudulent claim in an initial documentation may well have subsequent opportunities to rectify previous misrepresentations when the insurer calls for further proof of loss.... [T]he person who persists in asserting a fraudulent claim by continuing to submit material misrepresentations compounds the evil that the legislature seeks to eliminate with the [IFPA]. Construction of the [IFPA] to penalize claims rather than component statements would produce the inequitable result of placing the State in the same position with respect to [the defendant] as it would be in with respect to a claimant who makes an initial false statement and then recants. Such a result fails to effectuate the legislature‘s intent that persons who file several false statements should be punished for each instance of prohibited conduct.
[Id. at 437.]
The holding in Merin acknowledged that the legislative intent to curtail insurance fraud would be effectuated by penalizing each false statement submitted to support a fraudulent claim, “provided that the fаlse statement is material and significantly enhances the credibility of or evidentiary support for the claim.” Id. at 439. We added that
it would be unreasonable to increase the penalty for each instance that the same misrepresentation appears in a single document or for false assertions that substantively repeat information contained in other misrepresentations in the same document. We are confident, however, that the Commissioner does not seek to stretch the limits of the [IFPA] that far.
[Ibid. (emphasis added).]
We take the same approach to the Legislature‘s strikingly similar language concerning fraudulent statements of material fact that are now criminalized. The prior interpretation of the parallel language informs our perception of the Legislature‘s intention when it employed the same language and enhanced the scope of remedies available to combat insurance fraud. In light of the connection between the IFPA and the latеr crime of insurance fraud, defined in similar language, we conclude that the Legislature would have presumed, consistent with our Merin holding, that each document or narrative statement containing materially false facts would be held to be a separate “act” of insurance fraud. With that construction we effectuate the legislative intent to be tough on insurance fraud, but do so in a way that takes into consideration whether defendant reasonably should have been aware that three “acts” of insurance fraud would have been committed by knowingly making three reports of her loss that
To summarize, we reject the argument that more than five “acts” of insurance fraud were perpetrated by defendant when she made three statements in support of her fraudulent insurance claim. We hold that when a defendant provides to officials in connection with a fraudulent claim a document or oral narrative that contains a material fact or facts relating to the claim, each such document or narration is a “statement” equating to an “act” of insurance fraud. Although we recognize that there can be multiple “statements” in a single document or narration, for example when a document‘s or narration‘s contents relate to a
IV.
The judgment of the Appellate Division is affirmed for the reasons expressed in this opinion.
Justice LONG, concurring.
Because I do not believe that, in enacting
the person knowingly makes, or causes to be made, a false, fictitious, fraudulent, or misleading statement of material fact in any record, bill, claim or other document, in writing, electronically, orally or in any other form, that a person attempts to submit, submits, causes to be submitted, or attempts to cause to be submitted as part of, in support of or opposition to or in connection with: (1) a claim for payment, reimbursement or other benefit pursuant to an insurance policy....
At issue is whether each false claim, each false document, or each false statement, submitted by an insurance claimant, constitutes the act of insurance fraud proscribed by that statute.
Like the majority, I agree that the statutory definition, standing alone, is ambiguous and requires interpretation. I part company from my colleagues in connection with their concomitant conclusions that: (1) the legislative intent cannot be gleaned from the statute as a whole; and (2) that extrinsic evidence is of “little
My difficulty with the majority opinion begins with its failure to account for all aspects of
b. Insurance fraud constitutes a crime of the second degree if the person knowingly commits five or more acts of insurance fraud, including acts of health care claims fraud pursuant to section 2 of P.L. 1997, c. 353 and if the aggregate value of property, services or other benefit wrongfully obtained or sought to be obtained is at least $1,000. Otherwise, insurance fraud is a crime of the third degree. Each act of insurance fraud shall constitute an additional, separate and distinct offense, except that five or more separate acts may be aggregated for the purpose of establishing liability pursuant to this subsection. Multiple acts of insurance fraud which are contained in a single record, bill, claim, application, payment, affidavit, certification or other document shall each constitute an additional, separate and distinct offense for purposes of this subsection.
[
N.J.S.A. 2C:21-4.6 (emphasis added) (internal citation omitted).]
In common parlance, to aggregate is to add together or total up. The very use of the term “aggregate value” clearly indicates that the Legislature contemplated that each criminаl act of insurance fraud has a monetary value, otherwise there would be nothing to aggregate for the purposes of establishing liability by meeting the $1,000 threshold. If that is so, only a fraudulent claim can be actionable, not each document or lie submitted in support of such a claim. The final section of
It may be that Merin properly interpreted the statute before it-the New Jersey Insurance Fraud Prevention Act (IFPA),
On the contrary, the Health Care Claims Fraud Act,
As used in this act: “Health care claims fraud” means making, or causing to be made, a false, fictitious, fraudulent, or misleading statement of material fact in, or omitting a material fact from, or causing a material fact to be omitted from, any record, bill, claim or other document, in writing, electronically or in any other form, that a person attempts to submit, submits, causes to be submitted, or attempts to cause to be submitted for payment or reimbursement for health care services.
[
N.J.S.A. 2C:21-4.2 .]
The Health Care Claims Fraud Act also has an aggregation provision similar the one before us:
- A person, who is not a practitioner subject to the provisions of subsection a. or b. of this section, is guilty of a crime of the second degree if that person knowingly commits five or more acts of health care claims fraud and the aggregate pecuniary benefit obtained or sought to be obtained is at least $1,000. In addition to all other criminal penalties allowed by law, a person convicted under this subsection may be subject to a fine of up to five times the pecuniary benefit obtained or sought to be obtained.
....
- Each act of health care claims fraud shall constitute an additional, separate and distinct offense, except that five or more separate acts may be aggregated for the purpose of establishing liability pursuant to subsection c. of this section. Multiple acts of health care claims fraud which are contained in a single record, bill, claim, application, payment, affidavit, certification or other document shall each constitute an additional, separate and distinct offense for purposes of this section.1
[
N.J.S.A. 2C:21-4.3 .]
The one difference between the statutes is that the Health Care Claims Fraud Act has a legislative history that is neither sparse nor equivocal. Upon its enactment, that statute was accompanied by a full statement of the Senate Health Committee:
Under this bill, it would be a crime of the second degree when a practitioner knowingly submits, or attempts to submit, one fraudulent claim or when a person
who is not a practitioner submits, or attempts to submit, five or more fraudulent claims with an aggregate amount of at least $1,000. It would be a crime of the third degree when a person who is not a practitioner knowingly submits, or attempts to submit, one fraudulent claim. The bill also creates lesser offenses applicable to reckless, rather than knowing, fraudulent conduct. [S. Health Comm., Statement to S. No. 2270, at 1 (1997), cited in,
N.J.S.A. 2C:21-4.2 cmt. (2005).]
Thus, in describing the import of а statute nearly identical to the one before us, the Legislature has declared that it criminalizes a fraudulent “claim” and not the individual documents or lies undergirding it.
In that respect, it is well-settled that when the Legislature uses the same term in cognate statutes (and there is no question but that the Health Care Fraud Claims Act and
Finally, even if I were to agree that the majority view is a plausible one, the rule of lenity would require that this penal statute be strictly construed in favor of defendants, thus compelling the interpretation I here advance. State v. Alexander, 136 N.J. 563, 643 A.2d 996 (1994); State v. Sutton, 132 N.J. 471, 625 A.2d 1132 (1993). For those reasons, I concur only in the result reached by the majority.
Justice ALBIN joins in this opinion.
Opposed-None.