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Everett v. State Farm Indemnity Co.12/31/2002
benefits" in the context of N.J.S.A. 39:6A- 13.1. State Farm argues the statute should be read literally. That is, "last payment of benefits" should be read to require actual payment by the insurance company to either the insured or a medical provider, and not a credit against the deductible or co-payment. State Farm's interpretation is reasonable. Since deductibles and co-payments guarantee that PIP medical expenses are not paid in every automobile accident, Roig v. Kelsey, 135 N.J. 500, 509 (1994), an argument can be made that a credit against the deductible, which is the responsibility of the insured, rather than the insurance company, is not payment of a benefit to the insured. However, keeping in mind that the object of the no-fault law is reparation, a more expansive definition of the phrase "payment of benefits" may also be inferred. Webster's Third New International Dictionary (1971) defines "payment" as "1: the act of paying or giving compensation: the discharge of a debt or an obligation." The word "pay" is defined as: "2a. to satisfy (someone) for services rendered or property delivered: discharge an obligation to: make due return to." Given this definition, plaintiff argues that when State Farm adjusted the heating pad bill to the fee schedule and applied the balance to the plaintiff's deductible, the action was a discharge of the carrier's obligation to plaintiff; plaintiff received an indirect monetary benefit because his deductible was reduced. We agree.
It is axiomatic that if the text of a statute is susceptible to more than one interpretation, extrinsic factors, including statutory context and the underlying purpose of the legislation, must be considered. Aponte-Correa, supra, 162 N.J. at 323 (citations omitted).
As Justice Jacobs stated, ' hen all is said and done, the matter of statutory construction . . . will not justly turn on literalisms, technisms, or the so-called formal rules of interpretation; it will justly turn on the breadth of the objectives of the legislation and the commonsense of the situation.' [Ibid. (quoting Jersey City Chapter of Prop. Owner's Protective Ass'n v. City Council, 55 N.J. 86, 100 (1969)).]
Construing N.J.S.A. 39:6A-13.1 in the context of the Act and according due consideration to the Act's underlying purposes, plaintiff's interpretation is compatible with the liberal construction of the Act. By applying the fee schedule to the bill for the heating pad, and crediting the balance against plaintiff's deductible, the insured received an indirect monetary benefit, a reduction in his deductible.
Yet that is not the only reason we conclude that application of the bill to the deductible constitutes a "payment of benefits" under the statute. A liberal construction of N.J.S.A. 39:6A-13.1 is harmonious with the underlying purposes of statutes of limitations.
There is no dispute that the charge for the heating pad was an expense plaintiff incurred as a result of the accident. The bill was timely submitted to State Farm, which adjusted the bill to the fee schedule and applied it to plaintiff's deductible. By taking this action State Farm implicitly acknowledged that the heating pad expense was an expense incurred by plaintiff directly attributable to the accident. Once State Farm related the expense to the accident, regardless of whether it made a payment to a health care provider, State Farm was on notice to expect that it may be faced with claims for additional medical expenses in the future. As Justice Clifford stated in Ochs, supra, "once payment is determined to be due, the statute does not place any time limitations on the payment of future benefits." 90 N.J. at 114. Stated somewhat differently, once State Farm
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