(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for
the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not have been summarized).
[N.B., This is a companion case to New Jersey Manufacturers Insurance Co. v. Breen and Magnifico v. Rutgers Casualty Insurance Co., both of which have also been decided today.]
Argued January 6, 1998 -- Decided May 12, 1998
Stein, J., writing for a unanimous Court.
On October 19, 1992, Frank Grant was injured in an automobile accident while driving his own car. He
had $25,000 in underinsured motorist's (UIM) coverage under a policy issued by the Market Transition Facility
(MTF). The person who cause the accident had $25,000 of liability coverage and was not, therefore,
“underinsured” with respect to Grant's personal policy. Grant settled his claim for the limit of the other
driver's policy.
Grant lived with his brother, Michael Grant, when the accident occurred. Michael's auto policy with
Amica Mutual Insurance Company (Amica) provided $100,000 in UIM coverage. Because Michael's UIM
coverage was higher than the other driver's liability limit, Grant sought UIM benefits from Amica. The
company denied coverage based on this Court's decision in Aubrey v. Harleysville Insurance Co..
Grant sued Amica. The trial court found for the insurance company and dismissed the case. On appeal,
the Appellate Division reversed, relying on its decision in New Jersey Manufacturers v. Breen. That decision
concluded that Aubrey was not retroactive.
The Supreme Court granted Amica's petition for certification.
HELD: Under the circumstances of this case, the claimant was entitled to access to his brother's auto insurance
UIM coverage because he was a “family member” living with the insured at the time of the accident. The
retroactivity of Aubrey v. Harleysville Insurance Co. was not germane to the result in the within matter and
should not have been addressed below.
1. Based on the plain language of the Amica insurance policy and for the reasons expressed in New Jersey
Manufacturers v. Breen, the brother's UIM coverage was “held” by Grant and was available to compensate him
for his injuries. (pp. 4-5)
The judgment of the Appellate Division is MODIFIED and AFFIRMED.
CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI, and
COLEMAN join in JUSTICE STEIN's opinion.
SUPREME COURT OF NEW JERSEY
A-
91 September Term 1997
FRANK GRANT,
Plaintiff-Respondent,
v.
AMICA MUTUAL INSURANCE COMPANY,
Defendant-Appellant.
Argued January 6, 1998 -- Decided May 12, 1998
On certification to the Superior Court,
Appellate Division.
Daniel J. Pomeroy argued the cause for
appellant (Mortenson and Pomeroy, attorneys).
Fred Shahrooz-Scampato argued the cause for
respondent (Eichen & Cahn, attorneys; Barry
R. Eichen, of counsel).
The opinion of the Court was delivered by
STEIN, J.
This appeal raises questions of underinsured motorist (UIM)
coverage that are virtually indistinguishable from the issues
presented and resolved in New Jersey Manufacturers Insurance Co.
v. Breen, ___ N.J. ___ (1998), and are germane to the issues
resolved in Magnifico v. Rutgers Casualty Insurance Co., ___ N.J.
___ (1998), both of which appeals are also decided today. The
primary issue concerns the right of plaintiff, Frank Grant,
injured in an accident while driving his own automobile, to
recover UIM benefits under the automobile policy issued by Amica
Mutual Insurance Company (Amica) to his brother with whom Grant
lived. Grant's personal policy had a UIM limit equal to the
tortfeasor's liability limit. His brother's policy provided UIM
coverage greater than the tortfeasor's liability limit and made
available that coverage to family members of the insured. As in
Breen, a secondary issue is whether our decision in Aubrey v.
Harleysville Insurance Cos.,
140 N.J. 397 (1995), should be
applied only prospectively.
On October 19, 1992, Grant was injured in an automobile
accident while driving his own car. His car had $25,000 of UIM
coverage under a policy issued by the Market Transition Facility
(MTF). The tortfeasor had $25,000 of liability coverage. The
tortfeasor therefore was not underinsured with respect to Grant's
personal policy. Grant settled his claim against the tortfeasor
for the policy limit.
Grant lived with his brother, Michael Grant (Michael), when
the accident occurred. Michael's policy with Amica provided
$100,000 of UIM coverage. Because Michael's UIM limit was higher
than the tortfeasor's liability limit, Grant sought UIM benefits
under Michael's Amica policy. Amica denied Grant's claim on the
ground that Aubrey prevented Grant from collecting UIM benefits
under any UIM policy other than his own.
Grant sued Amica seeking a declaration that UIM benefits
were available to him under Michael's policy, and sought an order
to show cause why arbitration should not be compelled. Following
oral argument, the trial court sustained Amica's contentions
based on Aubrey, dismissed the order to show cause, and dismissed
Grant's complaint.
Grant appealed. In an unpublished opinion the Appellate
Division reversed, relying on its opinion in New Jersey
Manufacturers Insurance Co. v. Breen,
297 N.J. Super. 503 (App.
Div.), mod. and aff'd, ___ N.J. ___ (1998). The court held that
"Aubrey should not be applied to claims under policies issued
before the date of the Aubrey decision," and remanded for an
order compelling arbitration of Grant's UIM claim.
As explained fully in Breen, supra, ___ N.J. at ___-___ (slip op. at 6-7, 11-13), the Appellate Division's rationale in both Grant and Breen for applying Aubrey only prospectively rested on a flawed premise concerning the scope of our disapproval in Aubrey of Landi v. Gray, 228 N.J. Super. 619 (App. Div. 1988). We stated explicitly in Breen that "as amplified by French, our disapproval of Landi should be understood to refer only to the Landi court's invalidation of the exclusion of UIM
coverage when an underinsured vehicle of a resident family member
caused the claimant's injury." Breen, supra, ___ N.J. at ___
(slip op. at 7). Accordingly, as in Breen, the Grant panel's
holding that Aubrey should be applied only prospectively was not
necessary to sustain that court's disposition of Grant's appeal.
We also observed in Breen, relying on French v. New Jersey
School Board Ass'n Insurance Group,
149 N.J. 478, 487 (1997),
"that a policy 'held' by the claimant for purposes of satisfying
the statutory standard that determines whether a tortfeasor's
vehicle is underinsured need not necessarily be the policy
purchased by the claimant." Breen, supra, ___ N.J. at ___ (slip
op. at 8). In French, supra, we explained that for a claimant
who satisfies the threshold for UIM coverage
the statute contemplates that the insured is
free to pursue UIM benefits under other
policies under which he or she may be
insured--whether under his or her personal
policy, as the occupant of an employer's
vehicle, the permissive occupant of a motor
vehicle owned by any other insured person, or
as the resident in the household of a
relative possessing his or her own UIM
insurance. Each of those UIM policies is
opened up to the insured once the threshold
test is met.
[149 N.J. at 495 (emphasis added).]
We also stressed in Breen that policy language is the critical
factor in UIM coverage litigation. ___ N.J. at ___ - ___ (slip
op. at 9-10).
Because the facts essential to a resolution of the coverage
question are undisputed, and the policy language is dispositive,
we discern no need for a plenary hearing as urged by Amica to
resolve the issue of Grant's reasonable expectations. By its
terms the Amica policy's UIM coverage was available to Grant's
brother Michael, the named insured, and to "any family member."
Although the Amica policy's UM/UIM endorsement as it appears in
the record does not define family member, that term indisputably
applies to Grant who resided with his brother at the time of the
accident. Based on the plain language of the Amcia policy, we
conclude that the policy's UIM coverage was "held" by Grant and
that the policy's UIM coverage is available to compensate Grant
for his injuries. See Breen, supra, ___ N.J. at ___ - ___ (slip
op. at 8-11).
As in Breen, we disapprove of those portions of the
Appellate Division's disposition that determined that the
retroactivity of Aubrey was germane to the result and that
accorded Aubrey only prospective effect. As modified, we affirm
the judgment of the Appellate Division.
CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, O'HERN,
GARIBALDI, and COLEMAN join in JUSTICE STEIN's opinion.
NO. A-91 SEPTEMBER TERM 1997
ON APPEAL FROM
ON CERTIFICATION TO Appellate Division, Superior Court
FRANK GRANT,
Plaintiff-Respondent,
v.
AMICA MUTUAL INSURANCE COMPANY,
Defendant-Appellant.
DECIDED May 12, 1998
Chief Justice Poritz PRESIDING
OPINION BY Justice Stein
CONCURRING OPINION BY
DISSENTING OPINION BY