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New Jersey Supreme Court Unanimously Holds Future Medical Costs Still Payable by PIP are “Collectible” and Inadmissible at Trial

After she was injured in a car accident in 2016, Lakita Murray applied for Personal Injury Protection insurance benefits (PIP) that would pay her all of her post-accident medical bills up to $250,000. Her treatment after the accident did not hit that limit, nor did her medical expert’s opinion of what he anticipated to be her future medical expenses. After the trial court allowed a jury to hear the evidence of her future medical expenses, leading to a significant award in her favor, the appeals process led all the way to the New Jersey Supreme Court where, in Murray v. Punina, 2026 N.J. LEXIS 387 (2026), in an opinion handed down earlier this week, the issue was whether Murray’s evidence of future medical expenses is admissible at trial when those projected expenses would not exceed her PIP coverage limits.

Under New Jersey law, PIP benefits are intended to promptly pay the medical expenses of someone injured in a motor vehicle accident, regardless of whether the injured person was at fault (hence it’s official but less common name, “No-Fault” insurance). A caveat of PIP benefits under New Jersey law is that any amount “collectible” under PIP, that is any amount that falls within the limits of an injured person’s PIP coverage, may not be presented as evidence of damages when that plaintiff sues for their injuries at trial.

After her accident, the cost of Murray’s treatment before trial did not exceed her PIP limits of $250,000. In a deposition prior to trial, Murray’s expert opined that her future medical expenses – treatment Murray stated she would like to have but did not have prior to trial – would amount to between $42,000 and $160,000. Prior to trial the defendant filed a motion with the court to remove that testimony arguing that evidence of these expenses is inadmissible under the PIP law. The trial court denied the motion and admitted the expert’s opinion of how much her future medical treatment would cost. The jury found in Murray’s favor and awarded her $100,000 in future medical expenses. The defendant appealed on three basic facts: 1) Murray was eligible for $250,000 in PIP benefits, 2) those benefits had not been exhausted prior to trial, and 3) the expert’s projected future expenses would not exhaust the remainder of Murray’s PIP benefits. The Appellate Division reversed the trial court, finding that because PIP had not been exhausted, the expert’s proposed future medical expenses were still “collectible” under PIP and, thus, inadmissible at trial.

Murray asked the Supreme Court to review this opinion. She claimed future medical expenses are not “collectible” or “paid” as outlined in the law because they had not yet been incurred, and if they had not been incurred, they were not yet “collectible.” The defense argued  that any evidence of medical expenses, past or future, that do not exceed PIP limits are either “paid” or “collectible” under PIP and are thus inadmissible at trial.

The Supreme Court considered the arguments and agreed with the Appellate Division and defendant that future medical expenses that were “collectible” by PIP were inadmissible in a personal injury trial. The Court stated that this conclusion best reflects what the legislature clearly intended in passing the No Fault Act in that any amounts “collectible or paid” under PIP were inadmissible as evidence against the tortfeasor. Further, the Court disagreed with Murray’s position in that categorizing future expenses as “unpaid” and thus admissible as evidence, would allow a Plaintiff to defer treatment until after trial, and unfairly expose a defendant to greater exposure. Perhaps most importantly, the Court clearly voiced its distaste and rejection of a “double recovery,” or permitting a plaintiff to collect twice on future medical bills. It reasoned that if a plaintiff were allowed to show a jury future medical expenses that PIP could still pay, the Plaintiff would be able to recover those costs in the form of a jury verdict, and again from PIP. This, the Court determined, was not the purpose or intent of the PIP law.

Appellate Division Upholds Summary Judgment Dismissal of Suit for Plaintiff’s Failure to Maintain New Jersey Automobile Insurance

Plaintiff Ramon Hernandez claimed to have suffered injuries when his car was struck in the rear on a New Jersey road by a car being driven by defendant Hannah Kurtz and owned by co-defendant Eric Kurtz. In Hernandez v. Kurtz, 2024 N.J. Super. Unpub. LEXIS 3049 (App. Div. Dec. 17, 2024), the issue was whether plaintiff Hernandez’s failure to obtain a New Jersey automobile insurance policy at the time of the accident barred him from recovering damages for his injuries. The trial court judge relied upon a New Jersey statute which disallowed a monetary recovery when a plaintiff lacked the required New Jersey auto insurance coverage.

In this case, the plaintiff was driving his car when he met with an accident with defendants’ vehicle in New Jersey.  However, at the time of the accident, plaintiff had a driver’s license issued by the state of Maryland, and his vehicle was insured and registered in Maryland. Plaintiff sued defendants for damages from injuries he suffered as a result of the accident. Thereafter, defendants filed for a summary judgment dismissal of the lawsuit on the ground that his claim was barred because his car was considered “principally garaged” in New Jersey at the time of the accident, yet it was not insured under a New Jersey auto policy.

The Court reflected upon the applicable statutes, noting that N.J.S.A. 39:6B-1(a) mandated that every owner or registered owner of a motor vehicle, “registered or principally garaged in this State shall maintain . . . motor vehicle liability insurance coverage.” The coverage must include, a $15,000 minimum level of coverage for PIP benefits. The Court observed that, the applicable statutes did not define “principally garaged,” but case law suggested that term signified the physical location where the vehicle was primarily kept most of the time.

Defendants claimed that plaintiff’s claim was barred under N.J.S.A. 36:6A-4.5(a), which provided that an individual who failed to maintain Personal Injury Protection (PIP) coverage at the time of the accident was barred from recovering economic or non-economic losses for injuries suffered in the accident

Further, the Court noted that although the insurance statute did not provide a time interval for when a vehicle would be deemed to be principally garaged in New Jersey, the state’s motor vehicle statutes required owners of motor vehicles to get the vehicle registered in 60 days after re-locating to New Jersey. The Court clarified that the 60-day grace period was triggered not when the vehicle was principally garaged in the state, but rather, when the vehicle owner becomes a resident of the state.

Following the analysis of the applicable law, the Appellate Division observed that, in support of the motion for summary judgment, defendants relied upon plaintiff’s deposition testimony which revealed that he had moved to Maryland in 2007-2008, lived there for a few years and then moved back to NJ in 2021. It was his testimony that, at the time of his deposition, he had been living in New Jersey for about two and a half years. However, at the time of the accident, he had been living in New Jersey for about three months and had owned the subject vehicle for either two or three years. It was undisputed that, as of the time of the accident, plaintiff had not registered his car in New Jersey, nor had he procured a New Jersey auto insurance policy.

Plaintiff’s Maryland policy provided him with basic PIP coverage, mandated under Maryland law, which was only $2,500. It was undisputed that this coverage was below the $15,000 minimum PIP coverage required under New Jersey law. Thus, this policy did not comply with the requirements of a New Jersey auto insurance policy.

The Court noted that the motion judge correctly focused on the sixty-day grace period for car registration, and plaintiff’s acknowledgment that at the time of the accident he had been living in New Jersey for a longer period of “about three months, more or less.” The Appellate Division stated that the “principally garaged” provision denoted that the car owner should act promptly within a reasonable time to acquire the mandatory minimum insurance coverages and that, in this case, plaintiff failed to do so. Further, the Court noted that plaintiff presented no evidence to show that he had been living in New Jersey for less than three months before the accident and that his vehicle was garaged elsewhere.

Therefore, the Appellate Division upheld the decision of the trial court, ruling that plaintiff lacked the required New Jersey auto coverage at the time of the accident and, hence, was prohibited from recovering personal injury damages from defendants. Thus, the Court affirmed the summary judgment dismissal in favor of defendants.

Plaintiff Found to Be Eligible for PIP Benefits for Burns Suffered From Hot Tea Spilled on Her at Dunkin’ Donuts Drive-Through

Plaintiff, Shani Harrell, made a claim against her automobile insurance company, Progressive Garden State Insurance Company (“Progressive”), for personal injury protection (PIP) benefits when she suffered severe burns to her body after a restaurant employee spilled a hot beverage on her at a Dunkin’ Donuts drive-through.  She applied to Progressive for PIP benefits under her policy, which Progressive denied.  The issue in Harrell v. Mody Management, LLC d/b/a Dunkin’ Grand Group, Inc., 2024 N.J. Super. Unpub. LEXIS 2579 (App. Div. Oct. 23, 2024) was whether plaintiff was entitled to PIP benefits for her injuries.  (PIP benefits can include payment of medical bills, wage loss, and essential service benefits.)

At the trial court level, Progressive filed for summary judgment on the coverage issue.  The trial court granted summary judgment for Progressive, ruling that plaintiff was not operating her vehicle at the time she was injured and that there was no causal relationship between her use of the vehicle and her injuries. Hence, the judge found there was no coverage under her policy for PIP benefits.

This decision was appealed to the Appellate Division, which reversed. 

The Appellate Division noted that the facts showed that plaintiff was stopped in the drive-through while purchasing hot tea.  When the tea was passed to her through her window, the beverage cup and its top became dislodged, and the contents spilled into the driver’s compartment of the car onto plaintiff.  The hot tea flowed under her lap between her legs and onto the seat beneath her, burning her. 

She subsequently filed a claim for PIP benefits pursuant to her auto insurance policy.  According to her policy, PIP benefits would be paid “because of bodily injury caused by an accident and sustained by an injured person while occupying, entering into, alighting from, getting on, getting off of, loading, unloading, or using an automobile . . .”  Progressive had argued that there was no connection between the injuries claimed and her automobile.  Further, it argued that her injuries were not caused by the result of occupying, entering into, alighting from or using an automobile.

The trial court had agreed that there was no nexus between the use of the automobile and her injuries.  The Appellate Division, however, disagreed with that analysis.  It noted that the question required the court to consider whether a substantial nexus existed between the accident plaintiff suffered and the use of her car.

The Court noted that she was injured when hot tea was spilled and burned her as it was passed into her car.  She was obviously occupying her vehicle and sitting in the driver’s seat at the time she was injured.  She was clearly using her vehicle “to acquire her hot beverage from a business that expressly offers customers the option to pick up their food and drinks while remaining in their cars.”

Thus, the Court found that there was a substantial nexus between the burn incident and her vehicle use.  Therefore, the Appellate Division concluded that plaintiff was covered under her insurance policy’s PIP terms.  It reversed the order granting defendant summary judgment and remanded the matter back to the trial court.

Court Finds That Plaintiff Not Entitled to PIP Benefits For Injury While Operating an Electric Scooter

Plaintiff David Goyco was involved in an accident in which an automobile struck him while he was operating a low-speed electric scooter.  He applied to his auto insurance company, Progressive Insurance Company, for personal injury protection (PIP) benefits to pay for his medical expenses. The issue in Goyco v. Progressive Insurance Company, 2023 N.J. Super. Unpub. LEXIS 1117 (App. Div. July 5, 2023) was whether the plaintiff could recover PIP benefits for his injuries suffered in the accident.

The accident happened while plaintiff was operating a Segway Ninebot KickScooter Max when he was struck by an automobile on West Grand Street in Elizabeth.  This scooter has a maximum speed of 15.5 miles per hour and qualified as a “low-speed electric scooter”  (“LSES”) under N.J.S.A. 39:1-1.

At the time of the accident, plaintiff had automobile insurance with Progressive Insurance Company.  This policy provided personal injury benefits pursuant to N.J.S.A. 39:6A-4.  Accordingly, plaintiff filed a claim with Progressive for PIP benefits. 

However, Progressive denied plaintiff’s claim.  In its denial letter, Progressive stated that plaintiff was ineligible for PIP benefits under the policy because New Jersey No-Fault benefits were only available if the accident involved a qualifying automobile.  The scooter did not meet the definition of a qualifying automobile under New Jersey Auto Insurance Law. 

Further, the denial letter stated that plaintiff also did not meet the definition of a pedestrian, which was defined as “any person who is not occupying, entering into, alighting from a vehicle propelled by other than muscular power and designed primarily for use on highways, rails and tracks.” Therefore, Progressive denied plaintiff’s application for PIP benefits. 

Plaintiff filed this lawsuit to challenge this denial.  Plaintiff argued that New Jersey Law recognized bicycles as pedestrians for purposes of no-fault coverage.  Plaintiff argued that, by extension, an electric scooter should be considered the equivalent of a bicycle.

The trial court judge found that the plaintiff was operating a scooter powered by motor at the time of the incident.  It was clearly not a motor vehicle and neither in the statute nor the insurance policy would plaintiff be considered a pedestrian.  Therefore, the trial court judge entered an order denying plaintiff’s PIP application and dismissing the complaint.  This appeal ensued.

The Appellate Division conducted a “de novo” review of the trial court’s rulings of law and issues regarding the applicability, validity, or interpretation of laws and statutes.  The Court agreed with the trial court that under the plain language of the statute, the plaintiff did not qualify as a pedestrian.  It noted that an LSES is a vehicle propelled by other than muscular power.  By definition, an LSES is a vehicle that has an electric motor and, hence, plaintiff’s operation of the scooter disqualified him from being defined as a pedestrian and entitled to PIP benefits.

The Appellate Division also rejected the plaintiff’s argument that the operation of an LSES should be equivalent to a bicycle.  Thus, the Court upheld that portion of the trial court’s decision as well.

Accordingly, the Appellate Division affirmed the trial court’s decision. It agreed with the trial court that the plaintiff’s accident while operating a low-speed electric scooter did not entitle him to personal injury protection benefits to pay for his medical bills. 

Appellate Division Dismisses Auto Insurer’s Appeal Seeking to Avoid Remand Back to Arbitration Proceeding

By: Eric Richwine, Law Clerk

Editor: Betsy G. Ramos, Esq.

The issue before the New Jersey Superior Court, Appellate Division in Hackensack Meridian Health v. Citizens United Reciprocal Exch., 2023 N.J. Super. Unpub. LEXIS 1088 (App. Div. June 29, 2023) was whether Citizens United Reciprocal Exchange (“CURE”), an auto insurer, was liable for the remainder of a hospital invoice from Hackensack Meridian Health (“Hackensack”) after CURE only agreed to cover approximately one-fifth of the total. This lawsuit arose from the cost of almost a month of inpatient treatment following the motor vehicle accident of Andrew Manley, who was insured by CURE, and, therefore, able to benefit from the insurance policy’s personal injury protection (“PIP”) benefits. The specific issue raised upon appeal was whether CURE properly established an “accord and satisfaction” in order to avoid liability of the remainder of the cost.  

Mr. Manley was critically injured after a motor vehicle accident on September 8, 2019, and required twenty-five days of inpatient care at Hackensack’s facility. The cost of this treatment totaled $360,172.42. Months later, CURE disputed the billed amount via letter and expressed that it approved $67,445.67 per what was reasonable under PIP. CURE ultimately issued a check for $69,169.52, soon after which Hackensack deposited.

Hackensack followed CURE’s PIP appeal process and sought the full amount of the inpatient care originally sought, filing for PIP Arbitration pursuant to the Alternative Procedure for Dispute Resolution Act (“APDRA”), N.J.S.A. 2A:23A-1 to -32. Upon arbitration, the Dispute Resolution Professional (“DRP”) found in favor of CURE. The DRP reasoned that pursuant to the doctrine of accord and satisfaction, Hackensack had manifested the intent to accept the offer when it deposited the check.  

Hackensack appealed to the New Jersey Superior Court, Law Division, where it argued that CURE failed to comply with the requirements to deal in “good faith” with regard to a “bona fide dispute” in accordance with accord and satisfaction law by not responding to the original invoice within ninety days and by paying significantly less than what was owed. The trial court agreed and ultimately remanded the matter back to arbitration, finding that CURE’s payment did not constitute an accord and satisfaction because the amount paid was not in genuine dispute since both parties agreed that at least that much was owed, leaving the remainder of plaintiff’s bill as the actual amount in dispute.

CURE filed an interlocutory appeal in response to the trial court’s ruling. Notably, it did so without seeking leave. The appeal specifically argued against the trial court’s finding that accord and satisfaction did not apply and remand of the matter to the APDRA.

Upon appeal, the Appellate Division noted that the Court only considers appeals from final orders of a trial court and other orders expressly designated as final for purposes of appeal, as set forth by New Jersey Court Rules 2:2-3(a)(1), (3) and relevant case law, primarily relying upon Janicky v. Point Bay Fuel, Inc., 396 N.J. Super. 545, 549-50 (App. Div. 2007), which held that if a party seeks to appeal an order that is not final, then the party must seek leave to appeal from the Appellate Division. Because CURE failed to seek leave to appeal, the Court turned to the very narrow “nunc pro tunc” exception which permits the Appellate Division to grant leave to appeal in particular circumstances but found that it did not apply here, as it is only to be reserved for circumstances that warrant the “most extraordinary relief.”

The Appellate Division admonished CURE, noting that it knew the dispute had been remanded for further arbitration and had asserted on “appeal” the sole issue decided by the trial court, that of accord and satisfaction, as a strategic device in order to undermine the “alternative dispute mechanism” in the absence of a final order.

The Appellate Division further expressed that under the APDRA, there is a high standard for appellate review of an arbitration award per the state statutory procedures for PIP arbitration, citing N.J.S.A. 2A:23A-18(b), which does not permit appeal, and case law that has upheld the statute, such New Jersey Supreme Court’s holding in Mt. Hope Dev. Associates v. Mt. Hope Waterpower Project, L.P., 154 N.J. 141, 148-52 (1998). The Court did note that there is the opportunity for “limited review” per a public policy exception, but that this exception did not apply here and instead was reserved for matters deemed necessary, giving the example of a child support order.

Ultimately, the Appellate Division determined that CURE failed to “adher[e] to the rules” and that any affirmative outcome would be an “injustice to Hackensack.” As such, the Court dismissed the appeal.

Divided Supreme Court Finds Employers May Pursue Subrogation for Workers’ Compensation Benefits Paid for Economic Loss Where Employee Did Not Seek or Receive PIP Benefits

On May 12, 2020, the Supreme Court of New Jersey addressed whether an employer can maintain a subrogation action to recoup workers’ compensation benefits paid for economic loss where (1) its employee is barred from maintaining an action against the tortfeasors due to his election of the limitation-on-lawsuit option in his personal automobile policy; (2) the employee’s losses were covered by workers’ compensation benefits; and (3) the employee neither sought nor received personal injury protection (“PIP”) benefits.  In N.J. Transit Corp. v. Sanchez, 2020 N.J. LEXIS 520 (N.J. May 12, 2020), an equally divided Court answered that question in the affirmative.

On December 2, 2014, David Mercogliano, while acting in the course of his employment, was driving a vehicle owned by his employer, New Jersey Transit (“NJT”), when he was rear-ended by a vehicle being driven by Sandra Sanchez and owned by Chad Smith.  Mercogliano sustained minor injuries for which he received treatment, and was medically cleared to return to work without restriction two months after the accident.

At the time of the accident, Mercogliano was insured under an automobile policy for which he had elected the limitation-on-lawsuit option provided for under the Auto Insurance Cost Reduction Act (“AICRA”).  Under AICRA, when the limitation-on-lawsuit option has been selected, a person injured in a car accident cannot recover noneconomic damages against the person legally responsible for the accident, unless his injury falls into one of the categories specifically enumerated in AICRA.  Here, there was no dispute that Mercogliano’s injury did not fall within any of the specified categories, and that he thus could not recover for noneconomic injury against Sanchez or Smith.

NJT’s workers’ compensation carrier paid Mercogliano $33,625.70 in workers’ compensation benefits, including medical benefits, temporary indemnity benefits, and permanent indemnity benefits.  With his losses covered by workers’ compensation benefits, Mercogliano neither sought nor received PIP benefits under his personal automobile insurance policy.

In its capacity as Mercogliano’s employer and subrogee, NJT filed a complaint against Sanchez and Smith seeking to recoup the workers’ compensation benefits it paid to Mercogliano.  NJT relied on N.J.S.A. 34:15-40(f), a provision of the Workers’ Compensation Act which authorizes employers who have paid workers’ compensation benefits to injured employees to assert subrogation claims against the persons legally responsible for those injuries.  Here, NJT alleged Mercogliano’s injuries resulted from the negligence of Sanchez in causing the accident, and also asserted a vicarious liability claim against Smith as the owner of the vehicle and as Sanchez’s employer.

Sanchez and Smith moved for summary judgment dismissing NJT’s complaint. They claimed that NJT could not assert a subrogation claim because AICRA prevented Mercogliano from pursuing a third-party action against them, given his election of the limitation-on-lawsuit option in his personal insurance policy.  Sanchez and Smith further argued that because Mercogliano would have been eligible for PIP benefits had he not qualified for workers’ compensation benefits, AICRA barred NJT’s claim for reimbursement. 

In response, NJT argued that because its subrogation claim was based entirely on workers’ compensation benefits paid for economic losses (medical expenses and lost wages), and because Mercogliano received no PIP benefits, AICRA did not bar its suit against Sanchez and Smith.

Analyzing the legislative history of AICRA, along with the collateral source rule set forth therein, the Court found that the Legislature intended to allocate the burden for injuries incurred during the course of employment to employers and their workers’ compensation carriers.  As such, where an injury is compensable under both the Workers’ Compensation Act and AICRA (via PIP benefits), the Workers’ Compensation Act provides the primary source of recovery of medical expenses and lost wages.  In this scenario, the PIP carrier is relieved of the obligation to pay those benefits, such that PIP benefits are neither collectible nor paid.

Here, NJT paid workers’ compensation benefits for Mercogliano’s economic losses.  As a result, Mercogliano neither pursued nor received PIP benefits.  Under these circumstances, AICRA’s prohibition on the admission of evidence of PIP benefits “collectible or paid” was not implicated, as PIP benefits were neither collectible nor paid.

The Supreme Court found that the Workers’ Compensation Act reflects the Legislature’s clear intent to allow employers and carriers that have paid workers’ compensation benefits to assert subrogation rights against third-party tortfeasors.  The Court found no evidence that when the Legislature enacted AICRA, it intended to bar employers and insurers that have paid workers’ compensation benefits for economic loss from seeking reimbursement from third-party tortfeasors where the employee’s losses were covered by workers’ compensation benefits and he neither sought nor received PIP benefits.  An equally divided Court thus affirmed the Appellate Division’s decision to allow NJT to pursue its subrogation claim against Sanchez and Smith.

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