NJ Appellate Division Disagrees Over Retroactivity Of Scutari Amendment

In Hand v. Philadelphia Insurance Company, the New Jersey Appellate Division decided that the “Scutari Amendment,” N.J.S.A. 17:28-1.1(f), could be applied retroactively to an action commenced prior to the statute’s enactment. The Scutari Amendment essentially bars step-down provisions in motor vehicle liability policies issued to corporate or business entities which lower uninsured or underinsured motorist coverage for employees to the limits of coverage available to the employees under their personal policies. The Court’s decision in Hand was in direct disagreement with the recent case of Olkusz v. Brown wherein another panel of the Appellate Division decided that the amendment did not apply retroactively. In Hand, the court disagreed with the Olkusz decision and determined that the legislature implicitly meant for the amendment to be applied retroactively. Of note, despite its conclusion, the Hand court declined to apply the statute retroactively to the facts of that particular case stating that it would have imposed a manifest injustice upon the defendant insurer.

Thanks to Claudia Condruz for her contribution to this post.