New Jersey’s Deemer Statute, N.J.S.A. 17:28-1.4, applies to out-of-state drivers who are injured in accidents in New Jersey.  Under the Deemer Statute, if you are an out-of-state resident and you are hurt in an accident in New Jersey, you will be subject to New Jersey’s restrictive limitation on lawsuit or “verbal threshold” if your insurance company is licensed to transact business in New Jersey.  The verbal threshold places limitations on the right to recovery for injuries sustained in a motor vehicle accident.

In Leggette v. GEICO, plaintiff, a Virginia resident, was struck by a N.J. licensed driver as she crossed a street in Princeton. The trial court granted defendant’s summary judgment dismissal of her declaratory judgment complaint against GEICO. Plaintiff appealed the trial court’s decision, seeking PIP benefits pursuant to the Deemer Statute, since her Virginia policy was deemed to provide standard PIP coverage while her vehicle was in this state. The trial judge concluded that the Deemer Statute was inapplicable.

Plaintiff drove her Virginia registered vehicle insured by GEICO to Princeton University to visit her daughter. Plaintiff parked her vehicle and was walking across the street when she was struck by an automobile. Plaintiff settled her claims against the driver of the automobile, and then initiated a declaratory judgment action against defendant GEICO for PIP coverage to satisfy the $113,825.47 in medical bills.  Plaintiff argued that GEICO was authorized to conduct business in New Jersey and was therefore legally obligated under the Deemer Statute to provide minimum standard automobile insurance policy PIP benefits.

Defendant GEICO refuted this interpretation, arguing that plaintiff, a pedestrian, was not using or operating her vehicle at the time of the accident and so coverage required by the Deemer Statute was not triggered.  Defendant argued that a nexus between the out-of-state automobile and the accident is necessary.

The Appellate Court agreed with GEICO, since the Deemer Statute specified the terms “occupying…or using” an automobile in the context of eligibility for PIP benefits.  Here, plaintiff parked her car, locked the doors, walked away, exited the parking lot, and was crossing a street when she was struck by a vehicle. At the time she sustained her injuries, her “use” of her vehicle had ended. As such, the Deemer Statute was not triggered and the Appellate Court affirmed the trial court’s decision.  Thanks to Steve Kim for his contribution to this post.  Please email Brian Gibbons with any questions.