John Bardis v. First Trenton Insurance Co.

Annotate this Case

(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).

John Bardis and Helen Bardis v. First Trenton Insurance Co. (A-110-07)

Argued November 17, 2008 -- Decided June 10, 2009

HOENS, J., writing for the Court.

In this appeal, the Court addresses three questions. First, the Court addresses whether, in a jury trial arising
out of Underinsured Motorist (UIM) coverage, the insurer should be identified as the defendant. Second, the Court
considers whether, in the UIM trial, evidence that the insurer authorized payment of Personal Injury Protection (PIP)
benefits is relevant to whether there is a causal connection between the accident and the claimed injuries. Third, the
Court focuses on whether, in the unusual circumstances of this dispute, the UIM carrier's disavowal of knowledge of
the sources of payments for the medical treatment of plaintiff's injuries deprived plaintiff of a fair trial.

On February 13, 1997, plaintiff John Bardis was injured when his automobile was involved in a three-car
accident caused when a vehicle driven by Joseph Bologna hit the vehicle behind Bardis's, pushing it forward. At the
time of the accident, Bardis was insured by defendant First Trenton Insurance Company. The dispute is complicated
by the fact that the February 1997 incident was neither Bardis's first, nor his last, automobile accident. At the time
of the February 1997 accident, Bardis had degenerative disc disease and a significant history of neck, back, and
shoulder complaints. Consequently, there was a continuing series of MRI and other studies and treatment performed
on Bardis, which formed much of the basis for the dispute at trial.

There was no question that Bologna was the cause of the February 1997 accident, and Bardis settled with
him for the full extent of his $15,000 insurance policy. There was also no question raised by First Trenton about the
medical treatments that Bardis underwent after the February 1997 accident, all of which were covered under the PIP
provisions of his insurance policy. Nor did First Trenton decline to cover, as part of Bardis's PIP benefits, the cost
of back surgery performed on Bardis in 2003. It is that surgery, however, that has become the focal point of the
dispute between the parties in this appeal. Bardis asserts that the surgery performed in 2003 was causally related to
the February 1997 accident. First Trenton, at the UIM trial, contended that in fact it was not.

Bardis made two applications prior to or during trial. First, he requested that the judge advise the jury that
First Trenton was the defendant rather than referring to Bologna, the tortfeasor, as if he were the defendant. The
trial judge denied the application. Second, Bardis asked for permission to call and question Susan Wetherell, a First
Trenton employee, about her review of the PIP claims and the basis on which she had authorized their payment.
Bardis asserted that Wetherell's evaluation of his claims and her authorization of the payment of PIP benefits to pay
for his medical treatment was probative of causation. The trial court granted that request.

However, as a result of that ruling, the parties stipulated to the substance of the testimony that Wetherell
would have given in place of her appearance at trial as a witness, referring to her by name and describing her as a
"representative of the defendant." Counsel for First Trenton, who the jury had been told represented the tortfeasor
Bologna, then commented in closing that neither he nor Bologna knew Wetherell and questioned whether her
decision to pay for treatment of the injuries was relevant to causation.

After the jury returned its verdict in favor of defendant, Bardis appealed. In its published opinion, the
Appellate Division expressed its view that "under the circumstances it would have been better to tell the jury,
subject to an appropriate instruction, that the carrier was the defendant," but concluded that the trial court's contrary
decision was an appropriate exercise of discretion. The panel concluded that the trial judge had erred in permitting
evidence of PIP payments, both because those payments were not relevant and because Wetherell was not competent
to testify about causation of the injuries. Although critical of the closing argument by defense counsel essentially
disavowing knowledge of those payments, the panel reasoned that because the stipulation was inadmissible, those
comments did not deprive plaintiff of a fair trial. The panel therefore affirmed the verdict in defendant's favor.

The Supreme Court granted certification and thereafter granted amicus status to the Association of Trial
Lawyers of America-New Jersey (ATLA-NJ).

HELD: The Court concludes that there are strong reasons supporting the rule that the Underinsured Motorist (UIM)
litigation proceed in the name of the tortfeasor rather than the insurer, that these reasons ordinarily militate in favor
of identifying the defendant in the trial by using the name of that tortfeasor, and that the decision to identify the UIM
insurer as the defendant instead remains a matter left to the sound discretion of the trial judge should circumstances
dictate. The Court further concludes that payment of PIP benefits for treatment of an injury is irrelevant to the
question of causation of that injury. In addition, the closing argument by counsel disavowing his and the actual
tortfeasor's knowledge about the insurer's employee and her decisions to make PIP payments had the capacity to
confuse the jury, and its admission constituted reversible error.

1. Although courts ordinarily identify the real parties in interest in any litigation, and although First Trenton was
appropriately named in the UIM complaint as the defendant, that does not answer the question posed by plaintiff
about whether the insurer should be identified in the UIM trial by its own name. In other circumstances, the
Supreme Court has expressed its concern that references to insurance coverage might distract jurors from a fair
evaluation of the evidence, recognizing, as has the Appellate Division, that references to insurance might motivate
an award of damages based on a jury's perception of an insurer as having "deep pockets." Similar concerns are
voiced in the Rules of Evidence, for example N.J.R.E. 411. Not only are these matters of concern when the
tortfeasor is the defendant, but they are relevant as well in the UIM context. In reality, it is the accident and the
driver who caused it, rather than the insurer from which plaintiff now seeks a recovery for noneconomic damages,
that is in any way relevant to the issues to be decided. The claim against the insurer is a derivative one; the sole
focus is on whether the injuries, and the medical treatment that followed, were caused by the accident and, therefore,
whether plaintiff is entitled to a verdict to compensate him or her for noneconomic damages that resulted, and none
of those facts have to do with the insurer; the identity of the insurer is entirely irrelevant to any issue in the
proceeding. Nor is it accurate to say, as does plaintiff, that the trial court's decision to shield the insurer's identity
created confusion in the trial. In the context of a UIM claim, in which the identity of the insurer is not relevant to
any issue, and in which the jury's decision must focus on the behavior of the actual tortfeasor, the rule advanced by
plaintiff carries the greater risk of confusion. The Court thus rejects the request for a rule compelling the insurer in a
UIM trial to be identified as the defendant. The Court disagrees with the appellate panel's suggestion that such a
rule would be preferable and instead leaves it to the sound discretion of the trial judge to conclude, and to act
accordingly, if circumstances in a particular trial suggest otherwise. (Pp. 10-15)

2. By statute, the Legislature has required that "every standard automobile liability insurance policy . . . contain
personal injury protection [PIP] benefits for the payment of benefits without regard to negligence, liability or fault of
any kind." N.J.S.A. 39: 6A-4. The Court has previously held that this statute advances an important legislative goal
of ensuring that persons injured in automobile accidents will receive medical care and that the bills for that care will
be promptly paid. In order to achieve this important goal, the Court has understood the PIP statute to afford the
"broadest possible coverage." The Legislature has also enacted a statute that makes evidence of amounts paid or
collectible pursuant to PIP inadmissible in an ordinary suit for damages arising from an automobile accident. The
principal goal of that statute is to avoid double recovery for a loss. Although the Legislature has not extended that
prohibition to UIM suits, the underlying logic still pertains. A UIM action is essentially a contract-based substitute
for a tort action against the tortfeasor. In theory, then, there should be no different application of the rules governing
liability in a UIM case than those that apply in the trial of an ordinary tort action arising from a motor vehicle
accident. The prohibition on admissibility of PIP payments should apply regardless of whether the tortfeasor or the
plaintiff's own insurer is defending against the claim. The insurer that pays PIP claims in the ordinary course should
do so safe in the knowledge that the evidence of that payment will not be admissible in the event that there is a civil
suit, in order to avoid creating an incentive to decline payment. The Court therefore agrees with the Appellate
Division that the trial court erred in deeming the PIP payments admissible. (Pp. 15-20)

3. Although the Court concludes that the PIP payments were irrelevant to any of the issues that were before the jury
in this UIM trial, it cannot avoid the implications that flowed from the trial court's contrary decision. The closing
argument to the effect that defendant, and the attorney, had no idea who Wetherell was and why she had elected to
make the payments for the medical bills may well have confused the jury and caused it to reach an unjust result.
The stratagem inappropriately sought to undo the trial court's ruling about the relevance of those payments. The

Court therefore is constrained to reverse the verdict in defendant's favor and remand the matter for a new trial in
which the evidence of PIP payments shall be inadmissible. (Pp. 20-21)

JUSTICE ALBIN filed a separate, CONCURRING opinion, stating that although he concurs that this
case must be remanded for a new trial, in his opinion, the primary error the one that set the stage for the other
missteps identified by the majority was allowing First Trenton's attorney to falsely claim that he represented
Bologna, and not the insurance company. He would hold that the jury in a UIM coverage case, as in every other
case, is entitled to know who the true parties are to the action.

The judgment of the Appellate Division is REVERSED, and the matter is REMANDED to the Law
Division for proceedings consistent with this opinion.

CHIEF JUSTICE RABNER and JUSTICES LONG, LaVECCHIA, WALLACE, and RIVERA-
SOTO join in JUSTICE HOENS's opinion. JUSTICE ALBIN filed a separate, concurring opinion.

SUPREME COURT OF NEW JERSEY
A-
110 September Term 2007

JOHN BARDIS and HELEN BARDIS,
his wife,

Plaintiffs-Appellants,

FIRST TRENTON INSURANCE CO.,

Defendant-Respondent.

Argued November 17, 2008 Decided June 10, 2009

On certification to the Superior Court,
Appellate Division, whose opinion is
reported at
397 N.J. Super. 138 (2007).

David T. Wheaton argued the cause for
appellants (Levinson Axelrod, attorneys; Mr.
Wheaton and Matthew P. Pietrowski, on the
briefs).

Stephen A. Rudolph argued the cause for
respondent (Monte & Rudolph, attorneys;
Michael J. Lynch, on the brief).

Bruce H. Stern submitted a brief on behalf
of amicus curiae Association of Trial
Lawyers of America-New Jersey (Stark &
Stark, attorneys).

JUSTICE HOENS delivered the opinion of the Court.

In this matter, we are called upon to answer three

questions. First, we address whether, in a jury trial arising

out of Underinsured Motorist (UIM) coverage, the insurer should

be identified as the defendant. Second, we consider whether, in

the UIM trial, evidence that the insurer authorized payment of

Personal Injury Protection (PIP) benefits is relevant to whether

there is a causal connection between the accident and the

claimed injuries. Third, we focus on whether, in the unusual

circumstances of this dispute, the UIM carrier's disavowal of

knowledge of the source of payments for the medical treatment of

plaintiff's injuries deprived plaintiff of a fair trial.

We first conclude that there are strong reasons supporting

the rule that the UIM litigation proceed in the name of the

tortfeasor rather than the insurer, that these reasons

ordinarily militate in favor of identifying the defendant in the

trial by using the name of that tortfeasor, and that the

decision to identify the UIM insurer as the defendant instead

remains a matter left to the sound discretion of the trial judge

should circumstances dictate. Applying that reasoning, we will

not disturb the trial court's decision to preclude plaintiff

from identifying the UIM carrier as the defendant at trial in

this matter.

Second, we conclude that payment of PIP benefits for

treatment of an injury is irrelevant to the question of

causation of that injury. We further conclude that admitting

evidence of PIP benefits to infer a causal relationship would be

antithetical to the purposes of PIP, namely, the prompt payment

for medical care rendered after an accident. We therefore agree

with the Appellate Division's analysis that the trial court's

decision to admit evidence of PIP payments was in error.

Third, however, the trial court's error in admitting

evidence of PIP payments led to the use of a stipulation

identifying an employee of the insurer as having authorized

those payments, and to the closing argument by counsel

disavowing both his own and the actual tortfeasor's knowledge

about that employee and her decisions. Because under the

circumstances, that argument had the capacity to confuse the

jury, we disagree with the appellate panel's view that it

amounted to harmless error. We therefore reverse the verdict

and remand for a new trial at which the UIM carrier will not be

identified as the defendant and in which evidence of PIP

payments shall be excluded.

This appeal arises in the context of a UIM claim following

an automobile accident. On February 13, 1997, plaintiff John

Bardis was injured when his automobile was involved in a three-

car accident caused when a vehicle driven by Joseph Bologna hit

the vehicle behind plaintiff's, pushing it forward. At the time

of the accident, plaintiff was insured by defendant First

Trenton Insurance Company.

The dispute is complicated by the fact that the February

1997 incident was neither plaintiff's first, nor his last,

automobile accident. Although we need not detail the proofs at

trial, all of which are explained in the Appellate Division's

published decision, see Bardis v. First Trenton Ins. Co.,
397 N.J. Super. 138, 142-47 (App. Div. 2007), it is noteworthy that

at the time of the February 1997 accident, plaintiff had

degenerative disc disease and a significant history of neck,

back, and shoulder complaints and treatments.

Plaintiff did not seek any treatment immediately following

the accident, but instead went to work at the diner he owns and

to which he was headed when the accident occurred. The next day

he went to the emergency room, complaining of neck, back,

shoulder, and knee pain. In the months that followed, both x-

ray and MRI studies were performed that disclosed certain

injuries to his neck, back, and shoulder, as well as pre-

existing and degenerative conditions of his neck and back.

Plaintiff was in two subsequent motor vehicle accidents, a

head-on collision in September 1997 and an accident in 1999, the

specifics of which plaintiff could not recall. The particulars

of those events are not important; the relevance of each was

that there was a continuing series of MRI and other studies and

treatment performed on plaintiff, which formed much of the basis

for the dispute at trial.

There was no question that Bologna was the cause of the

February 1997 accident, and plaintiff settled with him for the

full extent of his $15,000 insurance policy. There was also no

question raised by First Trenton about the medical treatments

that plaintiff underwent after the February 1997 accident, all

of which were covered under the PIP provisions of his insurance

policy. Nor did First Trenton decline to cover, as part of

plaintiff's PIP benefits, the cost of back surgery performed on

plaintiff in 2003. It is that surgery, however, that has become

the focal point of the dispute between the parties in this

appeal.

Plaintiff asserts that the surgery performed in 2003 was

causally related to the February 1997 accident. First Trenton,

at the UIM trial, contended that in fact it was not, but that it

was caused either by continued degenerative processes that

preceded the accident or by one of the subsequent accidents in

which plaintiff was involved. Both sides presented significant

expert testimony on the question of causation of the plaintiff's

various injuries, all of which related, of course, to his claim

for noneconomic damages in the context of his UIM coverage

claim.

The three discrete issues that confront this Court arose

because of two applications plaintiff made to the court prior to

or during the trial. First, he requested that the judge advise

the jury that First Trenton, his insurer, was the defendant

rather than referring to Bologna, the tortfeasor, as if he were

the defendant. The trial judge denied that application based on

the guidance he derived from appellate level precedents and

consistent with his prior experience in conducting UIM trials.

Second, plaintiff asked for permission to call and question

Susan Wetherell, a First Trenton employee, about her review of

the PIP claims and the basis on which she had authorized their

payment. As part of that application, plaintiff asserted that

because the dispute in the UIM trial depended on which injuries

were causally related to the February 1997 accident, Wetherell's

evaluation of his claims and her authorization of the payment of

PIP benefits to pay for his medical treatment was probative of

causation. Over defendant's strong objections about both the

relevance of PIP payments and Wetherell's qualifications to

testify about causation, the trial court granted that request.

However, as a result of that ruling, the parties stipulated

to the substance of the testimony that Wetherell would have

given in place of her appearance at trial as a witness,

referring to her by name and describing her as a "representative

of the defendant." Counsel for First Trenton, who the jury had

been told represented the tortfeasor Bologna, then commented in

closing that neither he nor Bologna knew Wetherell and

questioned whether her decision to pay for treatment of the

injuries was relevant to causation.

After the jury returned its verdict in favor of defendant,

plaintiff appealed. In its published opinion, the Appellate

Division first expressed its view that "under the circumstances

it would have been better to tell the jury, subject to an

appropriate instruction, that the carrier was the defendant,"

but concluded that the trial court's contrary decision was an

Id. at 151. The panel
appropriate exercise of discretion.

concluded that the trial judge had erred in permitting evidence

of PIP payments, both because those payments were not relevant

and because Wetherell was not competent to testify about

causation of the injuries. Id. at 152-54. Although critical of

the closing argument by defense counsel essentially disavowing

knowledge of those payments, the panel reasoned that because the

stipulation was inadmissible, those comments did not deprive

plaintiff of a fair trial. Id. at 155. The panel therefore

affirmed the verdict in defendant's favor.

We granted certification,
194 N.J. 444 (2008), and we

thereafter granted amicus status to the Association of Trial

Lawyers of AmericaNew Jersey (ATLA-NJ).

II.

The contentions of the parties and amicus may be summarized

briefly. Plaintiff urges us to adopt a rule that requires that

the insurer in a UIM trial be identified as the defendant,

describing the current practice as "hiding the identity of . . .

the real defendant." He argues that we should embrace the logic

of the Appellate Division in Krohn v. New Jersey Full Insurance

Underwriters Ass'n, to the effect "[s]o long as the insurance is

not featured or made the basis at the trial for an appeal to

increase or decrease the damages, the information would seem to

be without prejudice."
316 N.J. Super. 477, 482 (App. Div.

1998), certif. denied,
158 N.J. 74 (1999). He argues that any

risk of prejudice can be neutralized with limiting instructions

explaining that a defendant's identity as an insurance company

is irrelevant to the issue of damages. He asserts that this

case is a perfect example of the genuine risk of confusion,

pointing out that defendant's improper disavowal of its

stipulation would not have happened had the jury been so

advised.

Second, plaintiff argues that counsel's summation comments

were "highly prejudicial because [they] made it appear that

[plaintiff] was hiding something" or "trying to pull a fast one

over on [the jury]." He argues that defendant should not have

been allowed to enter into the stipulation to prevent

Wetherell's appearance as a witness and then repudiate the

stipulation at trial. He urges us to reject the Appellate

Division's focus on the inadmissibility of the PIP evidence and

consider the effect of the summation on the jury's evaluation of

the evidence.

Third, plaintiff argues that the Appellate Division erred

in its conclusion that the stipulation about PIP payments should

have been excluded at trial. Plaintiff urges us to conclude

that the stipulation was relevant to the question of whether the

injuries were causally related to the accident, that it was not

an impermissible medical opinion of a lay witness, and that the

Appellate Division's policy rationale for excluding PIP payment

evidence was unfounded.

First Trenton argues that the trial court properly

exercised its discretion in declining to identify it as the

defendant at trial. First Trenton cites Krohn for the

proposition that, "[a]s a general rule, the probative value of

information regarding whether a person is insured or not is

substantially outweighed by the potential for undue prejudice"

based upon the perceived "deep pockets" of the insurance

Id. at 481-82.
company.

Second, First Trenton argues that the Appellate Division

properly rejected plaintiff's contentions regarding the

stipulation, asserting that those arguments are moot because the

jury returned a verdict of no cause in spite of the trial

court's improper ruling about the admissibility of PIP payments

that led to the stipulation. As part of its analysis, First

Trenton contends that if evidence of an insurer's payment of

medical expenses is admissible, there will be a "rippling and

chilling effect of making all PIP insurers fight, dispute and

litigate all PIP bills," contrary to the intent of the

legislative scheme.

With regard to the closing argument, First Trenton urges us

to agree with the Appellate Division that the comments were true

because the defendant - meaning Bologna - did not know

Wetherell and played no part in determining whether to pay

medical bills. Asserting that its argument did no more than

explain to the jury that they could, but were not obligated to,

accept the stipulation as true, First Trenton urges us to agree

with the appellate panel that there was no error.

Amicus ATLA-NJ addressed only the issue of whether to

identify the insurer or the tortfeasor as the defendant at

trial. It argues that the trial court created a fiction by

failing to advise the jury that First Trenton was the defendant

and urges us to compel courts to identify the insurer as the

defendant in UIM trials, albeit with limiting instructions.

Describing the practice followed by the trial court as "unfair

and prejudicial to both parties," it asks us to adopt a new

rule.

III.

Although we ordinarily identify the real parties in

interest in any litigation, and although First Trenton was

appropriately named in the UIM complaint as the defendant, that

does not answer the question posed by plaintiff about whether

the insurer should be identified in the UIM trial by its own

name. In other circumstances, we have expressed our concern

that references to insurance coverage might distract jurors from

a fair evaluation of the evidence. See Roman v. Mitchell,
82 N.J. 336, 347-48 (1980) (commenting on risk that voir dire

questions might create inappropriate focus on insurance). Our

Appellate Division has likewise recognized that references to

insurance might motivate an award of damages based on a jury's

perception of an insurer as having "deep pockets." Krohn,

supra,
316 N.J. Super. at 482.

Similar concerns are voiced in our Rules of Evidence.

N.J.R.E. 411, for example, provides that "[e]vidence that a

person was or was not insured against liability is not

admissible on the issue of that person's negligence or other

The theory that supports that Rule is not a
wrongful conduct."

concern that jurors will equate insurance with an insured

individual's lack of due care, but instead "that if jurors know

that an insurance company will be paying a judgment, they [the

jurors] might be reckless in awarding damages to a plaintiff."

Biunno, Current N.J. Rules of Evidence, comment on N.J.R.E. 411

(2008). Not only are these matters of concern when the

tortfeasor is the defendant, but they are relevant as well in

the UIM context.

In point of fact, the UIM claim is a contractual one,

arising out of the insurance policy issued to plaintiff by his

own insurer. See Zirger v. Gen. Accident Ins. Co.,
144 N.J.
327, 333 (1996); Krohn, supra,
316 N.J. Super. at 483. The

claim, however, has little to do with the contract of insurance

and everything to do with the accident in which plaintiff was

involved. It is only the happenstance of the tortfeasor's

minimal coverage as compared with plaintiff's injuries that

brings plaintiff's insurer, with its more generous UIM coverage,

into the courtroom. In reality, it is the accident and the

driver who caused it, rather than the insurer from which

plaintiff now seeks a recovery for noneconomic damages, that is

in any way relevant to the issues to be decided.

In a sense, the claim against the insurer is a derivative

one; the sole focus is on whether the injuries, and the medical

treatment that followed, were caused by the accident and,

therefore, whether plaintiff is entitled to a verdict to

compensate him or her for noneconomic damages that resulted.

None of those facts has any connection to the insurer; they have

only to do with the accident, the treatments, and the opinions

of the doctors that bear on the question of a causal

relationship. Indeed, in a UIM trial, a judgment against the

UIM carrier can only be entered if a noneconomic damage award is

returned that exceeds the coverage available from the

tortfeasor's insurance. Seen in that light, the identity of the

insurer is entirely irrelevant to any issue in the proceeding.

Nor is it accurate to say, as does plaintiff, that the

trial court's decision to shield the insurer's identity created

confusion in the trial. On the contrary, the confusion in the

trial was caused by the confluence of the erroneous decision

that PIP payments were relevant to the question of causation of

the claimed injuries, and the closing arguments in which counsel

for defendant sought to disavow knowledge of the decision-making

process that led to those payments. Had the trial proceeded in

the ordinary fashion of a UIM claim, in which the claimed

injuries and their causal relationship, if any, to the accident

were the focus, there would have been no need to identify the

insurer at all.

In considering the issues on appeal, the Appellate Division

commented that it "questioned the wisdom" of our general rule

about not identifying the insurer in a UIM trial as the

Bardis, supra,
397 N.J. Super. at 151 n.3. Although
defendant.

the panel opined that a contrary rule would be preferable, if

coupled with an appropriate instruction that the defendant's

identity is irrelevant, see Wenz v. Allstate Ins. Co.,
316 N.J.

Super. 570, 580 (App. Div. 1998), we disagree. In the context

of a UIM claim, in which the identity of the insurer is not

relevant to any issue, and in which the jury's decision must

focus on the behavior of the actual tortfeasor, the rule

advanced by plaintiff and the amicus carries the greater risk of

confusion. That rule would increase the risk of jury confusion

because the jury would first be told that the defendant is an

insurer, but would then be advised that this is irrelevant and

should play no role in their evaluation of the claim. That

rule, by injecting an entirely irrelevant fact into the trial,

creates a risk that far outweighs the remote possibility that

the jury might be confused if they are not so advised. Contrary

to the view expressed by our concurring colleague, this rule is

not designed "to hide . . . the fact that the case [is] about

insurance coverage," post at (slip op. at 1), because in a

UIM trial it is the judge who decides the coverage question when

molding the verdict to account for the tortfeasor's coverage.

Nor is it an effort to "feed[] fictions to the jury" or to

Post at (slip op. at 2). Rather, the
protect insurers.

rule is intended only to protect the integrity of the

factfinding process by leaving wholly irrelevant considerations

aside.

Notwithstanding that view, our decision is a narrow one; we

reject the request for a rule compelling the insurer in a UIM

trial to be identified as the defendant, and we disagree with

the panel's suggestion that such a rule would be preferable.

Instead, in the context of a UIM trial, in which the

circumstances of the underlying accident are the focus, we are

persuaded that the insurer's identity is ordinarily irrelevant.

Nonetheless, we leave it to the sound discretion of the trial

judge to conclude, and to act accordingly, if circumstances in a

particular trial suggest otherwise.

IV.

We turn, then, to the dispute between the parties

concerning the relevance, if any, in a UIM trial, of the

carrier's payment of PIP benefits for injuries claimed to have

been caused by the accident. By statute, our Legislature has

required that "every standard automobile liability insurance

policy . . . contain personal injury protection [PIP] benefits

for the payment of benefits without regard to negligence,

liability or fault of any kind." N.J.S.A. 39:6A-4.

We have previously held that this statute advances an

important legislative goal of ensuring that persons injured in

automobile accidents will receive medical care and that the

bills for that care will be promptly paid. Caviglia v. Royal

Tours of Am.,
178 N.J. 460, 467 (2004) (recognizing, as primary

among Legislature's goals, "providing benefits promptly and

efficiently to all accident injury victims"); see also Johnson

v. Scaccetti,
192 N.J. 256, 269 (2007) (noting that "the primary

aim of the various no-fault statutory schemes has been to

achieve lower premiums and prompt payment of medical expenses"

(citation and internal quotation marks omitted)); DiProspero v.

Penn,
183 N.J. 477, 485 (2005) (acknowledging the importance of

our "system of first-party self-insurance . . . [for]

provid[ing] an automobile accident victim prompt payment of out-

of-pocket medical expenses" (citation and internal quotation

marks omitted)); Aponte-Correa v. Allstate Ins. Co.,
162 N.J.
318, 323-24 (2000) (recognizing that primary goal of statute was

to "assure that injured plaintiffs are compensated promptly").

In order to achieve this important goal, we have understood

the PIP statute to afford the "broadest possible coverage."

Palisades Safety & Ins. Ass'n v. Bastien,
175 N.J. 144, 148

(2003) (quoting Svenson v. Nat'l Consumer Ins. Co.,
322 N.J.

Super. 410, 416 (App. Div. 1999)); see Bowe v. N.J. Mfrs. Ins.

Co.,
367 N.J. Super. 128, 139 (App. Div. 2004) (acknowledging

Legislature's intent "to provide PIP claimants the broadest

possible coverage").

The Legislature has also enacted a statute that makes

evidence of amounts paid or collectible pursuant to PIP

inadmissible in an ordinary suit for damages arising from an

See N.J.S.A. 39:6A-12. As we have noted,
automobile accident.

the principal goal of that statute is to avoid double recovery

for a loss. See Cirelli v. Ohio Cas. Ins. Co.,
72 N.J. 380, 387

(1977) (noting statutory objective to ensure that "injured

person who was the beneficiary of the PIP payments could not and

should not recover from the tortfeasor the medical, hospital and

other losses for which he had already been reimbursed"). We

have also identified easing court congestion and lowering

automobile insurance costs as the ancillary goals served by the

statute. Roig v. Kelsey,
135 N.J. 500, 513 (1994). Although

the Legislature has not extended that prohibition to UIM suits,

the underlying logic still pertains.

A UIM action is essentially a contract-based substitute for

a tort action against the tortfeasor. Krohn, supra,
316 N.J.

Super. at 483 (stressing that UIM cases are tried in manner of

third-party tort actions). The same is true of uninsured

motorist (UM) coverage claims as well. Midland Ins. Co. v.

Colatrella,
102 N.J. 612, 617 (1986) ("In effect, an uninsured

motorist provision is a contractual substitute for a tort action

against an uninsured motorist."). In theory, then, there should

be no different application of the rules governing liability in

a UIM case than those that apply in the trial of an ordinary

See Stabile
tort action arising from a motor vehicle accident.

v. N.J. Mfrs. Ins. Co.,
263 N.J. Super. 434, 441 (App. Div.

1993).

As our Appellate Division has observed, "whether [the

tortfeasor's] inadequacy is no insurance at all or

underinsurance has no conceptual consequence" because "[i]n both

instances, the insured victim's recovery is . . . a substitute

for that which would have been derived from a third-party suit

but for the inadequacy of the tortfeasor's insurance." Ibid.;

see Montedoro v. City of Asbury Park,
174 N.J. Super. 305, 308-

09 (App. Div. 1980) (noting that in UM context, "[t]he insured's

legal entitlement to damages for the uninsured driver's

negligence imports into the UM policy all of the normal rules

governing tort liability and damages"). Therefore, the

prohibition on admissibility of PIP payments should apply

regardless of whether the tortfeasor or the plaintiff's own

insurer is defending against the claim.

There are two reasons why this is so. First, there is

nothing in the decision to pay a PIP claim that is probative of

causation. For one thing, as this matter well illustrates, the

individual charged by the insurer with deciding whether to

authorize payment for medical care is ill-equipped to make a

decision on causation; he or she simply lacks the expertise

needed to decide that the medical treatment was caused by one

accident rather than another about which the employee may not

even be aware. That is, the defense at trial, that the injury

was actually caused by a later event, may be unknown to the

employee making the PIP decision; it may only be discovered

after litigation is in progress.

Second, there are strong reasons why evidence relating to

PIP payments should be excluded from a UIM trial that go beyond

preventing a double recovery. Because the goal of the PIP

system is to ensure both prompt medical care and prompt payment

of those who provide that care, see Caviglia, supra,
178 N.J. at
467, any collateral impact of the decision to make a PIP payment

must be carefully evaluated and circumscribed. That is to say,

the insurer that pays PIP claims in the ordinary course should

do so safe in the knowledge that the evidence of that payment

will not be admissible in the event that there is a civil suit,

in order to avoid creating an incentive to decline payment. By

ensuring that the fact of a payment is inadmissible at trial,

the insurer has every incentive to make payments and to do so by

using a rather broad interpretation of the relationship between

the claimed treatment and the underlying motor vehicle accident.

In the end, even if the causal relationship is weak, the

insurer, knowing its obligations, more likely will pay the claim

because the risk of an inappropriate denial outweighs any other

possible result of that choice.

If we were to agree with plaintiff and hold that the fact

of a PIP payment is relevant to the question of the causal

connection between a claimed injury and an accident, we would

create a strong disincentive to the insurer faced with a claim

for payment. The insurer, knowing that its decision to make a

payment on a PIP claim might later be admissible in evidence on

the question of whether the accident was causally related to the

injury for which the PIP-authorized treatment was rendered,

might well decline payment. At a minimum, the process of

deciding whether to make a PIP payment will become more complex

as decisions are made, inevitably, with the possibility of the

collateral use of the payment decision in mind. The costs of

insurance will rise, as additional layers of more sophisticated

reviewers and decision makers become involved in the process,

all out of a concern that the payment will become evidence of a

far different question, namely, causation. It would not serve

the larger legislative goal of creating a simple and expeditious

method for treatment and for prompt payment if we were to

conclude that the decision to pay for any particular treatment

might later be used against the insurer in litigation. We

therefore decline to do so, and we agree with the Appellate

Division that the trial court erred in deeming the PIP payments

admissible.

Although we therefore conclude that the PIP payments were

irrelevant to any of the issues that were before the jury in

this UIM trial, we cannot avoid the implications that flowed

from the trial court's contrary decision. The insurer, faced

with the adverse ruling and being required to present its

employee who had authorized the PIP payments to testify, entered

into a stipulation that the bills had been paid. That

stipulation identified Susan Wetherell, who otherwise would have

been required to appear and testify, described her as a

representative of defendant, and advised the jury that all of

the bills for medical treatment for the injuries that were in

dispute had been paid.

In that context, the closing argument to the effect that

defendant, and the attorney, had no idea who Wetherell was and

why she had elected to make the payments for the medical bills

may well have confused the jury. The stratagem inappropriately

sought to undo the trial court's ruling about the relevance of

those payments. Although the decision to admit the PIP payments

into evidence was error, we cannot have any confidence that the

summation to the effect that the payments and their source were

unknown to defendant did not cause the jury to reach an unjust

result. We are therefore constrained to reverse the verdict in

defendant's favor and to remand this matter for a new trial in

which the evidence of PIP payments shall be inadmissible.

VI.

The judgment of the Appellate Division is reversed, and the

matter is remanded to the Law Division for proceedings

consistent with this opinion.

CHIEF JUSTICE RABNER and JUSTICES LONG, LaVECCHIA, WALLACE,
and RIVERA-SOTO join in JUSTICE HOENS's opinion. JUSTICE ALBIN
filed a separate, concurring opinion.

SUPREME COURT OF NEW JERSEY
A-
110 September Term 2007

JOHN BARDIS and HELEN BARDIS,
his wife,

Plaintiffs-Appellants,

FIRST TRENTON INSURANCE CO.,

Defendant-Respondent.

JUSTICE ALBIN, concurring.

In this case, plaintiffs sued their underinsured motorist

(UIM) coverage carrier, First Trenton Insurance Co. (First

Trenton), for uncompensated damages from an automobile accident

caused by Joseph Bologna. With the trial court's approval, the

attorney defending First Trenton misrepresented to the jury that

his client was the tortfeasor, Bologna, and not the insurance

company. That deception, echoed by the trial court, was

intended to hide from the jury the fact that the case was about

insurance coverage. The majority now holds that the deception

that occurred in this case is a permissible approach -- a

necessary evil -- to ensure an insurance company a fair trial.

Whether in a UIM case or any other insurance coverage case,

I believe that the jury can handle the truth, that the jury can

be trusted to be fair to the true parties in interest, and that

feeding fictions to the jury is an unacceptable way to run a

transparent court system. I also believe that a properly

instructed jury -- even in an insurance coverage case -- is

capable of rendering a fair verdict. In courtrooms throughout

this State, juries hear sensational cases widely reported in the

press, sometimes involving notorious defendants or plaintiffs,

but we have faith that carefully selected jurors given proper

legal guidance will do justice. I see no reason to depart from

that paradigm for an insurance company in a UIM coverage case.

I concur with the majority that this case must be remanded

for a new trial, but in my opinion the primary error -- the one

that set the stage for the other missteps identified by the

majority -- was allowing First Trenton's attorney to falsely

claim that he represented Bologna, who apparently had no clue

that his name had been misappropriated for the benefit of the

insurance company.

Significantly, the Appellate Division questioned the

"wisdom of not telling the jury the truth about who the

Bardis v. First Trenton Ins. Co., 397 N.J.
defendant is."

Super. 138, 151 n.3 (App. Div. 2007). Here, the trial judge

instructed the jury that Bologna was the defendant, id. at 147,

when, in truth, First Trenton was the defendant. The appellate

panel was uneasy with the patronizing approach taken with the

jury. The panel noted that "[j]udges routinely instruct jurors

to disregard testimony improperly admitted or other

inappropriate behavior that occurs during a trial," and that the

jury is presumed to follow the limiting instructions. Id. at

151 n.3. Indeed, the panel "perceive[d] no difference between

those circumstances," and those in which a "plaintiff has

instituted a lawsuit against its own insurance carrier" and the

jury is instructed that the insurance company's status as a

party "`has no relevancy on the issue of damages.'" Id. at 151

& n.3 (quoting Wenz v. Allstate Ins. Co.,
316 N.J. Super. 570,

580 (App. Div. 1998)).

It bears repeating that in a multitude of instances, such

as where other-crime evidence is introduced at trial, see

N.J.R.E. 404(b), we depend on limiting instructions to avert any

prejudice that might flow from the improper use of such

See N.J.R.E. 105 ("[T]he judge, upon
information by the jury.

request, shall restrict the evidence to its proper scope and

shall instruct the jury accordingly, but may permit a party to

waive a limiting instruction."). In an insurance coverage case,

as in Wenz, the jury is told that the value of the damages must

be determined based on the evidence "unaffected by the fact that

plaintiff seeks recovery from his insurer." Wenz, supra,
316 N.J. Super. at 580. In such cases, the presumption that the

jury follows the trial court's instructions is "[o]ne of the

foundations of our jury system." State v. Burns,
192 N.J. 312,

335 (2007).

I do not understand the purpose of having a special carve-

out from our judicial policy of transparency in UIM coverage

cases. After all, the complaint is a public record available

for inspection in the courthouse, see R. 1:38, and from a review

of the complaint anyone would be able to identify the true

parties and the nature of the claim, see R. 4:5-1 and -2.

Moreover, once our jurisprudence permits a judge to lie to the

jury to avoid the necessity of giving a limiting instruction to

cabin in potentially prejudicial information, where will the law

of unintended consequences take us? Will a fast-food giant

argue that it should be allowed to take the pseudonym of Joe's

Café so the jury will not be swayed that a deep pocket can be

tapped? Will a defendant charged with committing a sensational

crime contend that he should be allowed to cloak himself with a

fictitious identity to ensure a fair trial?

Other jurisdictions that have considered similar issues

have rejected the approach taken by the majority. See, e.g.,

Lamz v. Geico Gen. Ins. Co.,
803 So. 2d 593, 595-96 (Fla. 2001)

("[W]hen the uninsured or underinsured motorist carrier is

properly named as a party defendant, it must be identified as

such. We have made it clear that the jury should know who the

parties are, and in this case, the jury was not fully apprised

of Geico's specific party status. This was reversible error.");

Earle v. Cobb,
156 S.W.3d 257, 260 (Ky. 2004) ("Kentucky is not

alone in recognizing the right of a plaintiff to bring a

contract claim against his or her UIM carrier and have that UIM

carrier identified as such at trial."); Tucker v. McQuery,
107 Ohio Misc. 2d 38, 42 (1999) ("[J]urors have the right to know

who the real party in interest is. In the case of automobile

accidents, there is almost invariably an insurance company

involved."); Lima v. Chambers,
657 P.2d 279, 285 (Utah 1982)

("The identity of the intervening insurance company should be

made known to the jury . . . ."); State ex rel. State Farm Mut.

Auto. Ins. Co. v. Canady,
475 S.E.2d 107, 113 (W. Va. 1996)

(recognizing case law holdings in other jurisdictions that "the

jury is entitled to be aware of the uninsured carrier's

identity").

In closing, I would hold that the jury in a UIM coverage

case, as in every other case, is entitled to know who the true

parties are to the action. Here, the initial misrepresentation

to the jury, which was responsible for the cascading mistakes

that followed, proves the old adage: "Oh, what a tangled web we

weave, / When first we practice to deceive!" Sir Walter Scott,

Marmion, canto I, intro., st. 17 (1808), quoted in Bartlett's

Familiar Quotations 378 (John Bartlett & Justin Kaplan eds.,

16th ed. 1992).

SUPREME COURT OF NEW JERSEY

NO. A-110 SEPTEMBER TERM 2007

ON CERTIFICATION TO Appellate Division, Superior Court

JOHN BARDIS and HELEN BARDIS,
his wife,

Plaintiffs-Appellants,

FIRST TRENTON INSURANCE CO.,

Defendant-Respondent.

DECIDED June 10, 2009
Chief Justice Rabner PRESIDING
OPINION BY Justice Hoens
CONCURRINGG OPINION BY Justice Albin
DISSENTING OPINION BY

REVERSE AND
CHECKLIST CONCUR
REMAND
CHIEF JUSTICE
X
RABNER
X
JUSTICE LONG
X
JUSTICE LaVECCHIA
(X) X
JUSTICE ALBIN
X
JUSTICE WALLACE
X
JUSTICE RIVERA-SOTO
X
JUSTICE HOENS
TOTALS 7

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.