Opinion
Civil No. 00-5764 (JBS).
September 27, 2001
Mark S. Gertel, Esq., BALLEN GERTEL, P.C., Cherry Hill, New Jersey, Attorney for Plaintiffs.
Denis McBride, Esq., KENT McBRIDE, P.C., Cherry Hill, New Jersey, Attorney for Defendants.
OPINION
In this case the Court is called upon to decide whether the New Jersey "Deemer Statute," N.J.S.A. 17:28-1.4, mandates certain levels of Personal Injury Protection (PIP) coverage from a foreign, self-insured automobile rental company that provided coverage to a vehicle rented in Virginia to a group of non-New Jersey residents who were involved in an accident on a New Jersey highway the next day. For reasons that follow, the Court finds that New Jersey law applies to the facts of this case, and will grant plaintiffs' motion for summary judgment in part, determining that the Deemer Statute applies.
Before the Court are plaintiffs' summary judgment motion pursuant to Rule 56, Fed.R.Civ.P., and defendants' motion to dismiss for lack of in personam jurisdiction, improper venue, and in the alternative to dismiss or transfer the complaint. At the outset, the Court finds the parent car rental company (Enterprise Rent-A-Car) was the insurer of the subject vehicle, and thus was properly named as a defendant in this suit, that the Court may exercise in personam jurisdiction over Enterprise Rent-A-Car, and that this case is properly venued in the District of New Jersey. The more difficult question to be resolved is whether Enterprise Rent-A-Car is bound to provide plaintiffs with the higher levels of Personal Injury Protection ("PIP") as required by New Jersey's Deemer Statute. As discussed below, the Court finds that due to the New Jersey situs of the accident, the New Jersey Deemer Statute must be applied, since it addresses precisely the situation envisioned by the New Jersey legislature. As further discussed, the Court finds that a self-insured rental car company, having obtained Certificates of Self-Insurance in New Jersey and Virginia, is the equivalent of an insurance carrier under the applicable Deemer Statute. Plaintiffs' summary judgment motion will be granted in part accordingly, and defendants' motion to dismiss or to transfer will be denied.
I. BACKGROUND
This action arises out of an automobile rental agreement entered into in Virginia for a trip to New York and back. On July 2, 1998, an individual named Papa Diop rented a Ford Explorer from Enterprise Leasing Company of Arlington, Virginia. The rental form indicated that the vehicle was to be operated by Diop, and additional driver "Mattew" Fall. (Pl. Ex. A.) Apparently, Diop rented the vehicle in order to drive from the D.C. area to JFK Airport in New York, pick up certain passengers arriving from Africa, and then drive back to the Washington, D.C., area. Enterprise Leasing was aware that the renters path would take them up the East Coast, through New Jersey as evidenced by the notation granting the renters permission to leave Virginia and to operate the vehicle in "VA*DC*MD*DE*NJ*NY." (Id.)
On July 3, 1998, plaintiffs Bintou D. Dieng and Oumou Dieng, and decedents Soukaina Coly, Assietou Dieng, and Awa Dieng, were traveling in the subject vehicle through New Jersey on the way back to the DC area. The vehicle, driven by Mr. Fall, was proceeding southbound on the New Jersey Turnpike when it was sideswiped by another vehicle, causing plaintiffs' Explorer to strike a concrete barrier and flip over. The crash ejected Fall and the other passengers, resulting in serious and/or fatal injuries to the individuals named as plaintiffs or plaintiffs' decedents in this suit. (Pl. Mat. Facts at 1-2.)
None of the parties were residents of New Jersey at the time of the accident. (D.'s Br. at 2.) Assietu Dieng, Awa Dieng, and Oumou Dieng were residents of Senegal, West Africa. (Id.) Bintou Dieng and Soukania Coy were residents of Maryland. (Id.) Enterprise Leasing Company, a Virginia corporation, owned and leased the subject vehicle. As is now evident, at the time Mr. Diop rented the vehicle, the parent company defendant Enterprise Rent-A-Car, a Delaware corporation with principal place of business in Missouri, held the certificate of self-insurance that covered vehicles rented by its Virginia subsidiary, Enterprise Leasing. Further, it is clear that Enterprise Rent-A-Car Company was, at all relevant times, identified as a self-insured in the State of New Jersey, its Certificate of Self-Insurance being approved by the New Jersey Department of Insurance. Finally, defendant ELCO Administrative Services Company ("ELCO") is a Missouri corporation with a principal place of business in New York, which performs the function of administration of claims presented against Enterprise. (Def. Mem. at 5.) ELCO has denied plaintiffs' claim for New Jersey PIP benefits in administering this case.
The record reveals that on March 6, 1987, the Commonwealth of Virginia Department of Motor Vehicles issued a "Self-Insurer Certificate" to Enterprise Leasing Company, approving that company as a Self-Insurer and assigning it number SI-157. (Pl. Supp. Br. Ex. 6.) In 1989, Self Insurance No. SI-157 was transferred to the parent company, Enterprise Rent-A-Car. On April 19, 1989, Virginia issued a new Self-Insurance Certificate under SI-157, naming Enterprise Rent-A-Car as the self-insurer authorized to use that number. (Pl. Supp. Ex. 5.) This self-insurance certificate remained in the hands of Enterprise Rent-A-Car until February 3, 1999, when Virginia again transferred the certificate, this time naming Enterprise Leasing Company (a Maryland Corporation) as the self-insurer assigned number SI-157. (Pl. Supp. Ex. 4.) The 1999 transfer was done at the request of Enterprise Rent-A-Car, as memorialized in its letter to the Virginia Department of Motor Vehicles dated October 30, 1998. In that letter, Enterprise Rent-A-Car asked that Certificate SI-157 "be changed to name only Enterprise Leasing Company (A Maryland Corporation, and a separate certificate be issued to name Enterprise Leasing Company of Norfolk/Virginia." (Ltr., Pl. Supp. Ex. 2.) As indicated by this letter, Enterprise Leasing of Virginia, the entity from whom plaintiffs rented the subject vehicle on July 2, 1998, did not have its own certificate of self-insurance until October 30, 1998. It follows that Enterprise Rent-A-Car was the only Enterprise entity with a self-insurance certificate on July 2, 1998, and thus was the insurer of the subject vehicle for the purposes of this case.
Correctly surmising that Enterprise Rent-A-Car was the insurer of the subject vehicle, plaintiffs filed suit against Enterprise Rent-A-Car and ELCO in New Jersey to recover PIP benefits. Plaintiffs originally filed suit in the New Jersey Superior Court, Law Division, Burlington County, on February 10, 2000. (Pl.'s Stmt. of Proc. Hist. at 4.) The complaint sought a declaratory judgment that plaintiffs and plaintiff decedents are entitled to New Jersey mandated PIP coverage as a result of the subject accident. (Id.) The Complaint named as defendants Enterprise Rent-A-Car Company, ELCO Administrative Services, and ELRAC Leasing. (Id.) Enterprise Rent-A-Car Company is the parent company in this action, ELCO Administrative Services administers all claims filed against Enterprise Rent-A-Car Company, and ELRAC Leasing is a subsidiary of Enterprise Rent-A-Car Company that has its principal place of business in New Jersey.
On March 30, 2000, the defendants removed the action to the United States District Court for the District of New Jersey. (Id.) On April 11, 2000, plaintiffs filed a motion to remand the action, on the ground that defendant ELRAC Leasing had its principal place of business in New Jersey and thus the New Jersey defendant may not remove a diversity case to the New Jersey federal court by statute. 28 U.S.C. § 1441(b). The Honorable Joel A. Pisano, U.S.D.J., granted plaintiffs' remand motion on May 25, 2000, and the case was remanded to New Jersey Superior Court. (Pl.'s Stmt. of Proc. Hist. at 4.)
Following discovery in the State Court, Plaintiffs determined that there was no basis for a claim against a defendant ELRAC Leasing. (Id.) Thus, on November 17, 2000, Judge Covie of the New Jersey Superior Court, Burlington County, ordered defendants to file an Answer to plaintiffs' Complaint, ordered that the parties file a stipulation of dismissal of plaintiffs' claims against defendant ELRAC Leasing, and ordered that the defendants file a Notice of Removal of the matter to this Court. (Id.) (The basis for ordering defendant to file a notice of removal is not clear upon this record.) Consequently, defendants' answer was filed in the New Jersey Superior Court on November 17, 2000, and a second Notice of Removal was filed on November 22, 2000, and the case was removed to this Court on that date. (Id.) This Court has diversity jurisdiction under 28 U.S.C. § 1332.
On January 23, 2001, defendants filed a Motion before this Court to Change Venue or in the Alternative to Dismiss Plaintiffs' Complaint. Also on January 23, 2001, plaintiffs filed a cross-motion for summary judgment based on New Jersey law, for outstanding medical bills and PIP benefits. On February 13, 2001, after the final submission date set by the Honorable Robert B. Kugler, U.S.M.J., this Court received a supplemental letter brief from the plaintiffs in support of their cross-motion. This letter brief enclosed several previously unavailable documents obtained from the Virginia Department of Motor Vehicles which plaintiffs claim "conclusively resolve an issue that has been repeated throughout Defendants' submissions to the Court: whether plaintiffs have sued the correct Enterprise entity." (Pl.'s Supp. Ltr. Br. at 1.) The Court agrees that these late submissions clear up the issue of which entity provided insurance coverage for the subject vehicle at the time of the accident. (See n. 1, supra.) Thus, despite its untimeliness, plaintiffs' supplemental submission provides useful information and will be incorporated into the record.
II. DISCUSSION
A. Summary Judgment Standard
A court may grant summary judgment only when the materials of record "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). In deciding whether there is a disputed issue of material fact the court must view the evidence in favor of the non-moving party by extending any reasonable favorable inference to that party. See Aman v. Cort Furniture Rental Corp., 85 F.3d 1074, 1080-81 (3d Cir. 1996);Kowalski v. L F Prods., 82 F.3d 1283, 1288 (3d Cir. 1996);Meyer v. Riegel Prods. Corp., 720 F.2d 303, 307 n. 2 (3d Cir. 1983), cert. denied, 465 U.S. 1091 (1984). Supreme Court decisions mandate that: "[w]hen the nonmoving party bears the burden of persuasion at trial, the moving party may meet its burden on summary judgment by showing that the nonmoving party's evidence is insufficient to carry its burden of persuasion at trial." Brewer v. Quaker State Oil Refining Corp., 72 F.3d 326, 329-330 (3d Cir. 1995) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1987)).
B. In Personam Jurisdiction
Having determined that Enterprise Rent-A-Car, a Missouri corporation, is properly named as a defendant (see n. 1,supra), this Court must decide whether to exercise in personam jurisdiction. A federal court may exercise jurisdiction to the extent authorized by the forum state, Rule 4(e), Fed, R. Civ. P. Here, the New Jersey Long Arm statute extends to the limits of the Fourteenth Amendment, thus this Court may exercise jurisdiction if constitutionally permissible. The test for determining whether such exercise is permissible is the well-known minimum contacts standard. Under this standard, the first step is to determine whether the defendant has sufficient contacts with the forum state. The second step is to evaluate those contacts in light of other factors to determine whether the assertion of personal jurisdiction would comport with fair play and substantial justice. See Burger King v. Rudzewicz, 471 U.S. 462, 476 (1985). In this case, plaintiff has demonstrated that both prongs of the in personam jurisdiction test are satisfied.
1. Minimum Contacts
With respect to sufficient minimum contacts, this prong is easily met. The Supreme Court has given several reasons why a forum may legitimately exercise jurisdiction over a nonresident who "purposefully directs" its activities toward that forum.See Burger King, 471 U.S. at 473-74. Plaintiffs point to three facts demonstrating that Enterprise Rent-A-Car has established systematic and continuous contact with this forum. First, defendant Enterprise Rent-A-Car Company is identified as a self-insured in the State of New Jersey in a Certificate of Self-Insurance on file with the New Jersey Department of Insurance. (Pl. Ex. G.) Consequently, Enterprise Rent-A-Car clearly has contemplated the possibility of dealing with vehicular accidents involving its vehicles in New Jersey. Second, Enterprise Rent-A-Car has taken out a full-page ad in the Verizon Yellow Pages telephone directory for Burlington County, New Jersey (the county in which the accident occurred), identifying eight locations in and near Burlington County in which Enterprise vehicles may be leased. (Pl. Ex. I.) The placement of an advertisement in this forum state demonstrates a willingness to do business here. Third, the contract formed between Enterprise Leasing Company and Papa Diop specifically contemplated that the vehicle would be traveling through New Jersey. When asked about his intended travel plans, Diop informed the Enterprise agent that he planned to travel from DC to New York, and back. Accordingly, in the portion of the Rental Agreement encaptioned "Permission Granted for Vehicle to Leave the State," the "Yes" box is checked, and the following states are identified: "VA*DC*MD*DE*NJ*NY." (Pl. Ex. A.) As the exclusive insurer of an Enterprise Leasing Company vehicle that was traveling through New Jersey, Enterprise Rent-A-Car Company must have reasonably foreseen the possibility of being hailed into court in this District. Similarly, as the exclusive adjustor of claims filed against Enterprise, defendant ELCO reasonably foresaw the prospect of New Jersey litigation over its denial of coverage for these plaintiffs.
In light of the foregoing, this Court finds that defendants Enterprise Rent-A-Car Company and ELCO have established minimum contacts with this forum and that it was foreseeable they might be hailed into court here.
2. Fair Play and Substantial Justice
The second part of the jurisdictional analysis is focused on the "traditional notions of fair play and substantial justice. The court must first evaluate the burden on the defendant to be a party to this action in this forum. As a national corporation with competent counsel in this District, eight field offices in the immediate area, and the resources of a large corporation, this Court finds that the Enterprise Rent-A-Car will not be unduly burdened to be a party to this action in this forum.
The forum state also has a strong interest in adjudicating this dispute. The fact the accident in question happened within its borders automatically gives New Jersey a valid interest in resolving this dispute. Moreover, the primary legal question in this case involves the application of N.J.S.A. 17:28-1.4, the New Jersey Deemer statute, and this state has a strong interest in enforcing its relevant insurance laws. In light of the foregoing, this Court finds that substantial justice would be served by this Court's exercise of in personam jurisdiction over the defendants in this matter.
N.J.S.A. 17:28-1.4 states in relevant part:
[A]ny insurer authorized to transact or transacting automobile or motor vehicle insurance business in this State, or controlling or controlled by, or under common control by, or with, an insurer authorized to transact or transacting automobile or motor vehicle insurance business in this State, which sells a policy providing automobile or motor vehicle liability insurance coverage, or any similar coverage, in any other state . . . shall include in each policy coverage to satisfy at least the . . personal injury protection benefits coverage pursuant to [N.J.S.A. 39:6A-4] . . . whenever the automobile or motor vehicle insured under the policy is used or operated in this State.
C. Venue
Defendants also request that the Court transfer this action to the United States District Court for the Eastern District of Virginia. Pursuant to 28 U.S.C. § 1391(c) "a defendant that is a corporation shall be deemed to reside on any judicial district in which it is subject to personal jurisdiction at the time the action is commenced." 28 U.S.C. § 1391(c). Here, it has been established that this court has in personam jurisdiction over the defendant Enterprise Rent-A-Car. Consequently, the first alternative of § 1391 is satisfied.
The venue requirement is also fulfilled because a substantial part of the events or omissions giving rise to the claim occurred in New Jersey. The fact the accident that underlies this action took place in New Jersey is facially sufficient evidence that "a substantial part of the events . . . giving rise to the claim" occurred in New Jersey. 28 U.S.C. § 1391(a)(2). Thus, pursuant to 28 U.S.C. § 1391(a), and for all of the foregoing, this Court finds that the District of New Jersey is a proper venue for this suit, and that it is inappropriate to dismiss or transfer pursuant to 28 U.S.C. § 1406. See Salvaara v. Jackson Nat. Life Ins. Co., 246 F.3d 289, 297 (3d Cir. 2001).
28 U.S.C. § 1406 states, in relevant part:
(a) The district court of a district in which is filed a case laying in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district of division in which it could have been brought.
C. Choice of Law
Having determined that plaintiffs' lawsuit survives defendants' jurisdiction and venue arguments, the Court turns to the merits of the parties' competing arguments over whether New Jersey or Virginia law applies to the facts of this case. Plaintiffs urge application of New Jersey law and its more generous mandatory PIP benefits, while defendants seek application of Virginia law.
In a diversity action, a federal court must apply the choice of law rules of the state in which it sits, Klaxon v. Stentor Elec. Mfg. Co., 313 U.S. 487 (1941), thus New Jersey choice of law rules apply here. First, there must be an actual conflict among the laws of the interested states. See Oil Shipping (Bunkering) B.V. v. Sonmez Denizcilik Ve Ticaret A.S., 10 F.3d 1015, 1018 (3d Cir. 1993). Here, there is an actual conflict between the two involved states' laws. New Jersey's Deemer statute imputes minimum levels of PIP coverage to non-resident drivers who are insured by insurers doing business in this state.See Dyszel v. Marks, 6 F.3d 116, 120 (3d Cir. 1993) (citing N.J.S.A. 17:28-1.4). In contrast to New Jersey law, Virginia insurers are not required to provide no fault PIP coverage. Under Virginia law, the only required insurance is third party liability and property damage protection, see Va. Code Ann. § 46.2-472(3), and uninsured motorist protection, see Va. Code Ann. § 38.2-2206. When a company is a self-insurer, as is Enterprise Rent-A-Car, it is only required to provide these basic coverages.See Va. Code Ann. § 46.2-368. Since, unlike New Jersey, Virginia does not mandate PIP coverage, there is an actual conflict of laws.
The next step is determining which of the conflicting laws to apply. New Jersey's courts have moved towards a flexible "governmental interest" approach to choice of law disputes, which focuses on which state has the most meaningful connections with and interests in the transaction and the parties. See NL Industries, Inc. v. Commercial Union Ins. Co., 65 F.3d 314, 319 (3d Cir. 1995) (Becker, J.) (citing State Farm Mut. Ins. Co. v. Simmons' Estate, 84 N.J. 28 (1980); Gilbert Spruance Co. v. Pennsylvania Mfrs. Ass'n Ins. Co., 134 N.J. 96 (1993)).
Even under New Jersey's modern governmental interest approach, however, cases involving commercial casualty insurance coverage disputes emphasize the place of contracting. NL Industries, supra, 65 F.3d at 319; Aetna Sur. and Cas. Co. v. Sacchetti, 956 F. Supp. 1163, 1168 (D.N.J. 1996). Under such circumstances, the law of the place of contracting should ordinarily be applied unless some other state has the dominant relationship with the parties and issues. NL Industries, 65 F.3d at 319. As the New Jersey Supreme Court has stated in the context of commercial general liability coverage litigation:
The law of the place of the contract will govern the determination of the rights and liabilities of the parties under the insurance policy. This rule is to be applied unless the dominant and significant relationship of another state to the parties and the underlying issue dictates that this basic rule should yield.Id. (quoting Simmons, 84 N.J. at 28).
New Jersey's courts have looked to the factors set forth in theRestatement Conflict of Laws (Second) §§ 6 188 to guide the determination of whether or not the place of contracting should govern. The Restatement identifies several general considerations pertinent to a court's choice of law analysis:
(a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, (d) the protection of justified expectations, (e) the basic policies underlying the particular field of law, (f) certainty, predictability and uniformity of result, and (g) ease in the determination and application of the law to be applied.Simmons, supra, 84 N.J. at 34 (quoting Restatement Conflict of Laws (Second) § 6(2) (1988)). While New Jersey courts do not rigidly apply these factors, they have been used for guidance.See e.g. Veazey v. Doremus, 103 N.J. 244, 250 (1986).
In choice of law disputes involving casualty insurance coverage, New Jersey's courts have also looked to § 193 of theRestatement, which counsels that the state with the most significant relationship is the state which the parties understood to be the "primary location of the insured risk." See e.g., Gilbert Spruance Co. v. Pennsylvania Manufacturers' Ass'n Ins. Co., 134 N.J. 96, 103 (1993) (interpreting comprehensive general liability policy pollution exclusion clause by applying New Jersey law to New Jersey activity notwithstanding Pennsylvania place of contracting). Section 193 is unhelpful in this case, however, because it is difficult to ascertain the "primary location of the risk" where the risk to be insured was a rental car which both parties understood would be traveling through several states. At the very least, the parties contemplated a two-way journey through the length of New Jersey and referenced "NJ" among other states in the rental agreement.
The choice of law/place of contracting analysis in this case is complicated somewhat by the fact that the parties' expectations and responsibilities were not laid out in a typical contract for insurance. This is because Enterprise Rent-A-Car is a self-insured entity in both New Jersey and Virginia. Nevertheless, self-insurance is the functional equivalent of a policy of insurance, the only distinction being the manner and the extent to which each carries its risk of loss. Ryder/P.I.E. Nationwide v. Harbor Bay, 119 N.J. 402, 411 (1990). Enterprise Rent-A-Car's coverage responsibilities as a self-insurer emanate from the rental agreement plaintiffs signed in Virginia on July 2, 1998, and thus the rental agreement at issue here is the functional equivalent of a contract for insurance. Accordingly, although Virginia is the place of contracting despite the lack of a formal contract for insurance coverage, New Jersey law will deem the policy of insurance to be amended if the carrier — here, Enterprise Rent-A-Car — also provides coverage to its New Jersey insureds under its New Jersey certificate of self-insurance.
Under N.J.S.A. 39:6-52(a), any person in whose name more than twenty-five vehicles are registered may qualify as a self-insurer by obtaining a certificate of self-insurance from the Commissioner of Insurance. To receive such status, one must satisfy the Commissioner that "`such person is possessed and will continue to be possessed of ability to pay judgments obtained against such persons.'" Ryder/P.I.E. Nationwide v. Harbor Bay, 119 N.J. 402, 409 (1990) (quoting N.J.S.A. 39:6-52(b)). There are no hard and fast criteria for becoming a self-insured, and the decision of whether to grant such status resides with the Commissioner. Id. at 412. Virginia law provides similarly indistinct criteria for becoming a self-insured. See Va. Code Ann. § 46.2-368 (Michie 1997) (Commissioner of Motor Vehicles may in his discretion issue or cancel certificate of self-insurance).
This inquiry is functionally different from reconciling a conflict of New Jersey and Virginia law. The underlying premise of the New Jersey Deemer Statute is that an insurance carrier writing policies for New Jersey drivers agrees that even its out-of-state policies will be deemed to provide at least the minimum level of PIP benefits required by New Jersey law if involved in a New Jersey accident. As noted above, the Deemer Statute, N.J.S.A. 17:28-1.4, provides that PIP coverage be "deemed" to be included in the insurance coverage of the out-of-state insured by statute even if it is not expressly stated in the written policy, so long as the policy was issued by an insurer licensed to do business in New Jersey. The Deemer statute specifies that it applies only to any insurer "which sells a policy providing automobile or motor vehicle liability insurance coverage, or any similar coverage. . . ." N.J.S.A. 17:28-1.4. Enterprise Rent-A-Car is registered as a self-insured in New Jersey, and can thus be said to be an entity doing business in this forum, including the business of providing automobile insurance coverage to its patrons in New Jersey by virtue of its self-insurance.
This Court has previously observed that New Jersey's interests in enacting the Deemer statute included "1) lowering the insurance premiums of New Jersey insureds; 2) materially reducing the number of auto-related personal injury cases litigated in the courts; 3) making no-fault PIP benefits available to all people injured in automobile accidents in New Jersey." Sacchetti, supra, 956 F. Supp. at 1170 (citingWatkins v. Davis, 259 N.J. Super. 482, 491 (Law Div. 1992)).
The Third Circuit, in applying New Jersey's choice of law rules to the Deemer Statute circumstance, has held that the general choice of law rule applying the law of jurisdiction where the insurance contract was signed "must yield to the New Jersey Legislature's policy considerations behind the deemer statue."Dyszel, 6 F.3d at 124. The "overwhelming interest" of New Jersey applying its own law to this dispute arises from the specific legislative mandate for PIP coverage. Id.
Accordingly, if an out-of-state insured is involved in a New Jersey motor vehicle accident, under coverage provided by a carrier also providing coverage to New Jersey insureds, no court, so far as research discloses, has hesitated to apply the PIP provisions and limitations that are implied by the New Jersey Deemer Statute. Dyszel, 6 F.3d at 124 (applying "verbal threshold" barring recovery by Pennsylvania insured arising from New Jersey accident); DiOrio v. Nationwide Mutual Ins. Co., 17 F.3d 657 (3d Cir. 1994) (holding that New Jersey Deemer Statute acts as amendment to Pennsylvania policy as applicable to New Jersey accident); Prudential Property and Casualty Ins. Co. v. Liberty Mutual Ins. Co., 896 F. Supp. 400 (E.D. Pa. 1994) (applying New Jersey Deemer Statute in New Jersey accident between two out-of-state insureds); Hamilton v. GEICO, 283 N.J. Super. 573 (1995), app. dismissed, 143 N.J. 481 (1996) (applying New Jersey Deemer Statute for benefit of New York resident passenger of New York insured arising from New Jersey accident, holding, "When N.J.S.A. 17:28-1.4 applies, there is no choice-of-law issue."); Adams v. Keystone Ins. Co., 264 N.J. Super. 367, 377-78 (App.Div. 1993).
This Court recognizes that Virginia does not impose mandatory PIP coverage on entities in the business of renting or self-insuring motor vehicles. See Va. Code Ann. § 46.2-108 ("No person engaged in the business of renting automobiles and trucks . . . shall rent any vehicle . . . unless the vehicle is an insured motor vehicle as defined in § 46.2-705); Va. Code Ann. § 42.2-705 ("`Insured motor vehicle' means a motor vehicle as to which there is bodily injury liability insurance and property damage liability insurance.") Virginia thus does not contemplate that rental car owners are required to provide PIP coverage.
Nontheless, paragraph Seven of the Rental Agreement expressly provides that Enterprise anticipates that PIP benefits may be required by the laws of other states and agrees to provide such coverage:
WAIVER AND REDUCTION OF PERSONAL INJURY PROTECTION AND UNINSURED/UNDERINSURED MOTORIST PROTECTION: Personal Injury Protection is neither contemplated not provided as part of this agreement. Renter expressly rejects and waives any Uninsured/Underinsured Motorist Protection from owner. If, and notwithstanding the foregoing the owner is required by law to provide Uninsured/Underinsured Motorist Protection or Personal Injury Protection to the renter or authorized driver, or any other individuals, the owner will provide such protection but only up to the minimum limits required by the state in which the vehicle is being operated, and renter expressly waives and rejects Uninsured/Underinsured Motorist protection and Personal Injury Protection limits in excess of the minimum limits and has expressly elected protection in the minimum limits. (Emphasis added.)
(Rental Agreement ¶ 7, Pl. Ex. A.) Under this provision, Enterprise acknowledged that the laws of the state in which the vehicle was being operated — here, New Jersey — might require PIP coverage and benefits in accordance with local law.
This Court holds, therefore, that the New Jersey Deemer Statute, N.J.S.A. 17:28-1.4, applies with respect to requiring New Jersey's Personal Injury Protection (PIP) benefits arising from a New Jersey motor vehicle accident, where the out-of-state vehicle is insured by a company authorized to transact insurance business in New Jersey regardless of the residency of the injured parties. It is thus necessary to examine whether defendant Enterprise, as a self-insured entity registered in New Jersey, is within the provisions of this statute. Enterprise disputes that it is the proper defendant and that a self-insured entity is subject to the statute.
The statutory language is the first guide. The New Jersey Deemer Statute at N.J.S.A. 17:28-1.4 provides in relevant part:
. . . In addition, any insurer authorized to transact or transacting automobile or motor vehicle insurance business in this State, or controlling or controlled by, or under common control by, or with, an insurer authorized to transact or transacting automobile or motor vehicle insurance business in this State, which sells a policy providing automobile or motor vehicle liability insurance coverage, or any similar coverage, in any other state . . ., shall include in each policy coverage to satisfy at least the . . . personal injury protection benefits coverage pursuant to [N.J.S.A. 39:6A-4] . . . whenever the automobile or motor vehicle insured under the policy is used or operated in this State.
The statute does not limit its coverage to those liability insurance policies that provide PIP coverage, but rather it more broadly encompasses all liability insurance policies and "any similar coverage." Automobile insurance provided to persons who rent automobiles qualifies as "any similar coverage" since New Jersey requires such insurance or self-insurance for all passenger motor vehicles, whether rented or owned, in conformity with N.J.S.A. 39:6A-4.
As noted above, a self-insured entity in New Jersey has the same responsibility to provide PIP benefits as an insurance carrier. The Appellate Division recently required a self-insured defendant to reimburse the PIP carrier for the plaintiffs' host vehicle for coverage provided to the insured plaintiffs. Park v. Park, 309 N.J. Super. 312 (App.Div. 1998). Self-insureds are required in New Jersey to provide coverage identical to that of an ordinary insurance carrier. Ryder/P.I.E. Nationwide, Inc. v. Harbor Bay Corp., 119 N.J. 402, 410 (1990). Indeed, "with respect to the scope of coverage obligations, it is the well-settled policy of this state to consider a self-insurance certificate as the equivalent of a policy of insurance." Id. at 413. Thus, the defendant's Certificate of Self-Insurance is, under the New Jersey law, "the equivalent of a policy of insurance," Id. at 410, and also it is "the functional equivalent of [the self-insured's] writing a separate insurance policy covering itself." White v. Howard, 240 N.J. Super. 427, 431 (App.Div.), certif. denied, 122 N.J. 339 (1990).
Accordingly, as discussed above, defendant Enterprise Rent-A-Car Company has filed a Certificate of Self-Insurance with the New Jersey Department of Insurance. This Certificate applies to coverage for the circumstances present here, where one entity — Enterprise Leasing Co. — owns the vehicle and its related entity has provided and obtained the Certificate of Self-Insurance, see N.J.A.C. 11:3-30.4(a). Enterprise Rent-A-Car and Enterprise Leasing Co. enjoyed this same relationship with respect to Enterprise Rent-A-Car's Virginia certificate of self-insurance as of the date of the accident, as described in note 1, supra. Thus, defendant Enterprise Rent-A-Car was the insurer of the subject vehicle, which is the same entity as had posted the New Jersey Certificate of Self-Insurance. Since the Deemer Statute applies to the coverage provided by insurers, the actual ownership of the subject vehicle becomes irrelevant.
N.J.A.C. 11:3-30.4(a) provides: "Any person in whose name more than 25 motor vehicles are registered or in whose name more than 25 motor vehicles are leased may qualify as a self-insurer by obtaining a certificate of self-insurance issued at the discretion of the Commission as provided in this subchapter."
It follows, then, that defendant Enterprise is obligated to satisfy the minimum requirements of N.J.S.A. 39:6A-4 providing PIP benefits to the occupants of the subject vehicle who were injured or killed as a result of the accident, because Enterprise is a certified self-insured, and thus has the equivalent obligations of an insurance carrier, as it provides "any similar coverage" within the meaning of N.J.S.A. 17:28-1.4.
Finally, defendants assert that plaintiffs should be estopped from claiming PIP benefits under the New Jersey Deemer Statute when, as indicated in the Complaint at ¶ 26, no-fault benefits were paid and accepted in accordance with Maryland insurance law, allegedly under a policy of insurance issued by GEICO in the State of Maryland. Defendants argue, without citation, that GEICO is licensed to do business in New Jersey and is thus itself subject to the New Jersey Deemer Statute. (Def. Reply Br. at 12.) This issue has not been adequately briefed, and defense counsel's assertion may be incorrect in fact as GEICO is not authorized to do business in New Jersey, according to the New Jersey Insurance Commissioner. New Jersey Dep't of Banking Ins., Insurance Companies Authorized to Do Business in the State of New Jersey and Their Code Numbers (Nov. 20, 2000), http://www.naic.org/nj/filings/htm. The amounts and beneficiaries of such Maryland PIP payments is unknown on the present record, and the issue whether defendants may be entitled to a set-off or other reduction has not been addressed by counsel and this Court makes no determination on the estoppel and set-off issues.
That the New Jersey Deemer Statute applies to this accident and supplies coverage to the same extent as New Jersey's PIP recovery statute means that the plaintiffs are entitled to summary judgment declaring this to be so. Whether particular claims are eligible for PIP benefits, and the amount of same, and the availability of reduction or set-off of PIP benefits, remain to be determined. The Court is unwilling to enter final judgment in plaintiffs' favor in the form proposed until the impact, if any, of plaintiffs' receipt of Maryland PIP benefits can be determined. To this limited extent, plaintiffs' summary judgment motion is denied in part. This motion is otherwise granted in part, declaring that the plaintiffs' recovery of PIP benefits under N.J.S.A. 39:6A-4 will be governed by the New Jersey Deemer Statute, N.J.S.A. 17:28-1.4, the precise amount to be determined by further proceedings consistent with this Opinion and the accompanying Order.
ORDER
THIS MATTER having come before the court on the plaintiffs' motion for summary judgment pursuant to Rule 56, Fed.R.Civ.P., and the defendants' motion to dismiss on grounds of lack of in personam jurisdiction, improper venue, and choice of law; and the Court having considered the parties' submissions; and for the reasons expressed in the accompanying Opinion of today's date;IT IS on this ____ day of September, 2001, hereby
ORDERED that plaintiffs' motion for summary judgment [Docket Entry Nos. 7 10] is GRANTED IN PART, and the Court DECLARES that plaintiffs shall be entitled to recovery of PIP benefits under N.J.S.A. 39:6A-4 pursuant to the New Jersey Deemer Statute, N.J.S.A. 17:28-1.4, the precise amount to be determined by further proceedings consistent with the accompanying Opinion, and that plaintiffs' motion is otherwise DENIED WITHOUT PREJUDICE ; and it is FURTHER ORDERED that defendants' motion to dismiss and alternatively to transfer venue [Docket Entry Nos. 8 9] is DENIED.