In Scholes v. Hausmann, No. A-0980-17T3 (N.J. Super. Ct. App. Div. 2018), the Superior Court of New Jersey, Appellate Division held that a New Jersey statute precluded recovery in a personal injury action. Plaintiff and Defendant were involved in an automobile accident in which Plaintiff sustained injuries. The vehicle he was driving was titled and registered in his name using his friend’s address in Florida, despite him living and working in New Jersey and garaging the vehicle in New Jersey. Plaintiff failed to obtain a New Jersey driver’s license or register his vehicle in New Jersey, and had a Florida car insurance policy, not a New Jersey policy. Plaintiff admitted that he continued to maintain his Florida insurance because “Florida insurance was less expensive than New Jersey insurance.”

As a result of his injuries, the Plaintiff applied for personal injury protection (PIP) benefits through his Florida Geico automobile insurance policy. The Florida Geico policy was not approved by the New Jersey Commissioner of Banking and Insurance, and it only provided $10,000 per person in medical benefits coverage.

Defendant moved for summary judgment, arguing N.J.S.A. 39:6A-4.5(a) barred Plaintiff’s claims because the Commissioner did not approve his insurance policy and, therefore, he was uninsured under the statute. N.J.S.A. 39:6A-4.5(a) provides that a person who fails to maintain medical expense benefits coverage shall have no cause of action for recovery of economic or non-economic losses sustained as a result of an accident while operating an uninsured automobile. The court noted that “[t]he Legislature adopted N.J.S.A. 39:6A-4.5 in 1997 to limit the ability of persons injured in motor vehicle accidents to sue persons responsible for their injuries.”

The court held that Plaintiff should have obtained New Jersey-approved insurance because he garaged his vehicle in New Jersey, and his failure to do so rendered him uninsured for purposes of N.J.S.A. 39:6A-4.5(a). Consequently, N.J.S.A. 39:6A-4.5(a) bars Plaintiff’s cause of action for recovery of economic and non-economic damages sustained as a result of the accident.

The court considered and rejected an argument that N.J.S.A. offends plaintiffs’ due process rights, noting that the goal of the statute is to incentivize New Jersey residents to maintain automobile insurance approved by the Commissioner of Banking and Insurance.