SUSEELA BOTLAGUDUR VS. KRISHNA BOTLAGUDUR AND SUSEELA BOTLAGUDUR VS. TRAVELERS HOME AND MARINE INSURANCE COMPANY VS. KRISHNA BOTLAGUDUR (L-6398-17, MIDDLESEX COUNTY AND STATEWIDE) ( 2020 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-1312-18T3
SUSEELA BOTLAGUDUR,
Plaintiff-Respondent,
v.
KRISHNA BOTLAGUDUR
and AMR A. ALBIUMI,
Defendants-Respondents.
__________________________
SUSEELA BOTLAGUDUR,
Plaintiff-Respondent,
v.
TRAVELERS HOME AND
MARINE INSURANCE
COMPANY,
Third-Party Plaintiff/
Appellant,
v.
KRISHNA BOTLAGUDUR and
AMR A. ALBIUMI,
Third-Party Defendants/
Respondents.
________________________________
Argued November 18, 2019 – Decided September 18, 2020
Before Judges Fasciale, Rothstadt and Mitterhoff.
On appeal from the Superior Court of New Jersey,
Law Division, Middlesex County, Docket No. L-6398-
17.
Timothy P. Smith argued the cause for appellant
(Kinney Lisovicz Reilly & Wolff PC, attorneys;
Timothy P. Smith of counsel and on the briefs).
John G. Mennie argued the cause for respondent
Suseela Botlagudur (Schibell & Mennie, LLC,
attorneys; John G. Mennie of counsel and on the
brief).
Respondents Krishna Botlagudur and Amr A. Albiumi
have not filed a brief.
PER CURIAM
Defendant Travelers Home and Marine Insurance Company (Travelers)
appeals two orders entered by the trial court. Defendant Krishna Botlagudur
was driving a car with his wife, plaintiff Suseela Botlagudur, as a passenger,
when the car was involved in an accident. Plaintiff sued both her husband and
the driver of the other vehicle for her physical injuries. Plaintiff also filed an
action for declaratory relief against Travelers, who was her insurer, seeking
$500,000, the limit for liability coverage under the Travelers policy.
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In plaintiff’s action against Travelers, the trial judge granted summary
judgment in favor of plaintiff. The judge found that an exclusion in the
Travelers policy that barred bodily injury coverage for family members, which
was permitted under Florida law, was unenforceable under New Jersey law.
The judge struck this exclusion from the Travelers agreement, and found that a
provision in the policy, which guaranteed "at least" the minimum amounts and
types of coverage required under the laws of another state where an accident
occurs, was ambiguous. The judge thus determined that plaintiff was entitled
to the maximum liability coverage under the policy. Travelers moved to
reconsider, and the trial judge denied its motion. Having reviewed the record,
and in light of the applicable law, we reverse and remand.
We discern the following facts from the record. On June 16, 2016,
plaintiff was a passenger in a car driven by her husband, and was physically
injured when the car collided with a car driven by defendant Amr Albiumi.
The accident occurred in East Brunswick, but both plaintiff and defendant
were Florida residents when the accident occurred.
At the time of the accident, plaintiff was the named insured under a
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policy issued by Travelers, which ran from January 2016 through January
2017. The Travelers policy established coverage limits of up to $500,000 for
each person and each accident, subject to certain limitations on liability.
Under the Travelers policy, the following language was included:
DEFINITIONS
A. Throughout this policy, "you" and "your" refer to:
1. The "named insured" shown in the
Declarations; and
2. The spouse if a resident of the same
household.
....
LIABILITY
Coverage A – Bodily Injury
Coverage B – Property Damage
INSURING AGREEMENT
A. We will pay damages for "bodily injury"
(Coverage A) or "property damage" (Coverage B) for
which "Insured" becomes legally responsible because
of an auto accident. * * * We have no duty to defend
any suit or settle any claim for "bodily injury" or
"property damage" not covered under this policy.
B. "Insured" as used in these coverages means:
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1. You or any "family member" for the
ownership, maintenance or use of
any auto "trailer".
The Travelers policy also listed several exclusions for which Travelers would
not provide liability coverage. The policy executed by plaintiff included
Endorsement A09018, entitled Amendment of Policy Provisions – Florida
("intrafamily exclusion"), which states in relevant part,
II. Liability
A. Under Exclusion, Section A, the following is
added as an additional exclusion:
For "bodily injury" to you or any "family
member".
The Travelers policy also included the following provisions as to out -of-state
coverage under the Liability Coverage Section of the agreement:
OUT OF STATE COVERAGE
If an auto accident to which this policy applies occurs
in any state or province other than the one in which
"your covered auto" is principally garaged, we will
interpret your policy for that accident as follows:
A. If that state or province has:
....
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2. A compulsory insurance or similar law
requiring a nonresident to maintain insurance
whenever the nonresident uses a vehicle in
that state or province, your policy will
provide at least the required minimum
amounts and types of coverage.
Plaintiff had never reviewed the Travelers policy, and was therefore
unfamiliar with its contents. Plaintiff had not even selected the policy for
herself, as her husband chose the policy for her with the help of the American
Automobile Association. Plaintiff's husband was likewise unfamiliar with the
majority of the terms in Travelers Policy, having only read the liability limits
that were included on the agreement’s declarations page.
On August 2, 2017, plaintiff sued her husband and Albiumi for damages
related to her personal injuries that she had sustained from the crash. On
October 30, 2017, plaintiff filed a complaint for a declaratory judgment against
Travelers. Plaintiff requested that the court find intrafamily exclusion to be
invalid in New Jersey, thereby entitling plaintiff to up to $500,000 in coverage
for her bodily injuries suffered during the crash, and awarding plaintiff costs
and fees. On November 28, 2017, Travelers filed an amended answer and
counterclaim, seeking a determination that plaintiff is only entitled to a
statutory minimum of $15,000 in liability coverage pursuant to our State’s
Deemer Statute, N.J.S.A. 17:28-1.4. Travelers also filed a third-party
A-1312-18T3
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complaint against plaintiff's husband and Albiumi to bind them to the court's
determination on coverage.
On March 27, 2018, Travelers moved for summary judgment, with
plaintiff filing opposition and cross-moving for summary judgment. On
August 8, 2018, the motion judge issued an oral decision denying Travelers'
motion for summary judgment and granting plaintiff's motion for summary
judgment. The motion judge decided to apply New Jersey law, and held that
the intrafamily exclusion in the Travelers policy, which would otherwise have
been valid under Florida law, did not apply. The judge did not explain the
basis for his decision to apply New Jersey law over Florida law.
Having found that the intrafamily exclusion was invalid under New
Jersey law, the judge determined that the "plain language of the policy states[]
it will provide at least the required minimum amounts and types of coverages"
required under New Jersey law. The judge thus concluded that including the
language "at least required" in the policy "implies [the coverage limit] would
rise up to the minimum amount rather than to go down to the minimum
amount." The judge concluded that the policy's language was unclear, and
chose to construe the provision in plaintiff's favor, thereby holding that
Travelers' potential liability to plaintiff would be governed by the policy limits
A-1312-18T3
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of $500,000, as opposed to the $15,000 mandatory minimum under the Deemer
statute.
Travelers moved for reconsideration of the summary judgment decision.
In part, Travelers relied on a policy approved by the New Jersey Department
of Banking and Insurance (DOBI) in July 2015 that allowed insurers to
exclude intrafamily liability coverage pertaining to claims for bodily injuries
to insureds that are in excess of the statutorily required minimum liability
coverage. Plaintiff disagreed with Travelers' position, arguing that the
intrafamily exclusion in Travelers' policy did not conform with the permissible
provision allowed by DOBI, which contemplated that the intrafamily exclusion
would not outright bar coverage, but would only "not apply to the portion of
the damages that is less than or equal to minimum limits required under New
Jersey law."
On November 1, 2018, the motion judge issued an oral decision denying
Travelers’ motion for reconsideration. The judge concluded that Travelers had
repeated the same arguments in its reconsideration motion as it raised in its
motion for summary judgment. The judge reaffirmed his findings that
Travelers' out-of-state coverage provision did not limit coverage to the
statutory minimum prescribed in the Deemer statute, explaining that
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Specifically, the . . . policy states that your policy will
provide at least the required minimum amounts of
coverage. The clause, as is written, does not stipulate
that the policy will provide the bare minimum of the
statutorily-required coverage, only that it will provide
at least the required amount afforded by the Deemer
statute. The Court still believes that this language in
the policy written by [Travelers] is not so clear and
unambiguous [as] to be interpreted as a step-down
clause.
he judge thus concluded that because plaintiff was afforded coverage under the
Travelers policy that was much higher than the statutory minimum, she should
be entitled to full coverage because the language in the out-of-state coverage
provision was a step-up clause.
Addressing an argument by Travelers that the motion judge should have
applied the substantive law of Florida, the judge concluded that our state does
not decide the conflicts of law issue based on the law of the place where a
contract was executed. The judge held that "since New Jersey is the place of
injury . . . wherein the witnesses and evidence are located, it is this state which
has a substantial governmental interest in having its law applied and, therefore,
New Jersey law should govern." This appeal ensued.
On appeal, Travelers raises the following arguments for our review:
I. THE STANDARD OF APPELLATE REVIEW OF
A GRANT OF SUMMARY JUDGMENT IS DE
NOVO. (NOT RAISED BELOW).
A-1312-18T3
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II. THE MOTION COURT ERRED IN DECIDING
THE VALIDITY OF A FLORIDA INSURANCE
POLICY UNDER NEW JERSEY LAW INSTEAD OF
FLORIDA LAW.
III. NEW JERSEY CHOICE OF LAW PRINCIPLES
REQUIRED THE MOTION COURT TO APPLY
FLORIDA LAW TO DETERMINE THE RIGHTS OF
THE PARTIES.
IV. UNDER FLORIDA LAW, THE FLORIDA
LIABILITY EXCLUSION IS VALID, RESULTING
IN THE TRAVELERS POLICY PROVIDING ONLY
SO MUCH LIABILITY COVERAGE AS IS
REQUIRED BY NEW JERSEY LAW.
V. UNDER NEW JERSEY LAW, THE TRAVELERS
POLICY AFFORDS NO MORE THAN $15,000 IN
LIABILITY COVERAGE FOR PLAINTIFF'S
INJURIES.
VI. BECAUSE THE FLORIDA LIABILITY
EXCLUSION AND THE OUT-OF-STATE
COVERAGE PROVISION IN THE TRAVELERS
POLICY ARE UNAMBIGUOUS, THE MOTION
COURT ERRED IN RE-WRITING THE
TRAVELERS POLICY TO PROVIDE COVERAGE
IN EXCESS OF ITS PLAIN TERMS.
VII. THE MOTION COURT COMMITTED
REVERSIBLE ERROR IN GRANTING SUMMARY
JUDGMENT TO PLAINTIFF BASED ON
CONSTRUING THE FLORIDA LIABILITY
EXCLUSION BY ITSELF INSTEAD OF
CONSTRUING THE TRAVELERS POLICY AS A
WHOLE.
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VIII. PLAINTIFF, WHO NEVER READ HER
POLICY, CANNOT BE SAID TO HAVE HAD A
REASONABLE EXPECTATION OF $500,000 IN
LIABILITY COVERAGE FOR INJURIES TO AN
INSURED WHEN THE TRAVELERS POLICY,
CONSTRUED AS A WHOLE, UNAMBIGUOUSLY
DID NOT PROVIDE SUCH COVERAGE.
Considering the present matter on appeal, we review a grant of summary
judgment de novo. Conley v. Guerrero, 228 N.J. 339, 346 (2017). Thus, "summary
judgment will be granted if there is no genuine issue of material fact and 'the moving
party is entitled to a judgment or order as a matter of law.'" Ibid. (quoting Templo
Fuente De Vida Corp. v. Nat'l Union Fire Ins. Co. of Pittsburgh, 224 N.J. 189, 199
(2016)); see also R. 4:46-2(c).
At the outset, we first construe whether the Deemer Statute affords
plaintiff coverage under these circumstances. Pursuant to the Deemer Statute,
in relevant part,
Any insurer authorized to transact or transacting
automobile or motor vehicle insurance business in this
State, or controlling or controlled by, or under
common control by, or with, an insurer authorized to
transact or transacting insurance business in this State,
which sells a policy providing automobile or motor
vehicle liability insurance coverage, or any similar
coverage, in any other state or in any province of
Canada, shall include in each policy coverage to
satisfy at least the personal injury protection benefits
coverage pursuant to [N.J.S.A. 39:6A-4] or [N.J.S.A.
17:28-1.3] for any New Jersey resident who is not
A-1312-18T3
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required to maintain personal injury protection
coverage pursuant to [N.J. Stat. § 39:6A-4] or section
[N.J.S.A. 17:28-1.3] and who is not otherwise eligible
for such benefits, whenever the automobile or motor
vehicle insured under the policy is used or operated in
this State. In addition, any insurer authorized to
transact or transacting automobile or motor vehicle
insurance business in this State, or controlling or
controlled by, or under common control by, or with,
an insurer authorized to transact or transacting
automobile or motor vehicle insurance business in this
State, which sells a policy providing automobile or
motor vehicle liability insurance coverage, or any
similar coverage, in any other state or in any province
of Canada, shall include in each policy coverage to
satisfy at least the liability insurance requirements
[N.J.S.A. 39:6B-1] or [N.J.S.A. 39:6A-3], the
uninsured motorist insurance requirements of
[N.J.S.A. 17:28-1.1], and personal injury protection
benefits coverage pursuant to [N.J.S.A. 39:6A-4] or of
[N.J. Stat. § 17:28-1.3], whenever the automobile or
motor vehicle insured under the policy is used or
operated in this State.
[N.J.S.A. 17:28-1.4.]
"The Deemer [s]tatute is so named because it 'deems' New Jersey insurance
coverage and tort limitations to apply to out-of-state policies." George J.
Kenny & Frank A. Lattal, New Jersey Insurance Law § 14-6:6 (2019)
(footnote omitted). Relevant to our scrutinizing an insurance policy under the
Deemer statute, the Automobile Insurance Cost Reduction Act (AICRA),
N.J.S.A. 39:6A-3.1, established the creation of two insurance coverage options
A-1312-18T3
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for "any owner or registered owner of an automobile registered or principally
garaged in [New Jersey]": a basic policy and a standard policy. The basic
policy "carries no [bodily injury coverage] unless an optional $10,000 amount
is selected." Felix v. Richards, 241 N.J. 169, 173 (2020). In contrast, the
standard policy is defined as:
one with at least the coverage required by N.J.S.A.
39:6A-3 and [-4]. N.J.S.A. 39:6A-3 mandates
compulsory automobile insurance liability limits of
$15,000[] on account of [bodily] injury to or death of
one person in any one accident, a limit of $30,000[]
for injury to or death of more than one person in any
one accident and $5,000[] for damage to property in
any one accident, all exclusive of interests and costs.
[George J. Kenny & Frank A. Lattal, New Jersey
Insurance Law § 14-10 (2019).]
Where the Deemer statute is inapplicable, an ordinary choice of law analysis
applies when there is a conflict with New Jersey insurance law. Id. at § 21-10.
Until recently, our state courts had not discussed the impact of the basic
and standard policies introduced by AICRA on the Deemer Statute and the
requirements it imposes on out-of-state insurance policies. This changed with
our Supreme Court’s recent decision in Felix, which guides our decision here.
In Felix, the parties got into a car accident, and Richards was insured under a
New Jersey automobile policy that had been issued by AAA Mid-Atlantic
A-1312-18T3
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Insurance Company (AAA). 241 N.J. at 176. The AAA policy provided
bodily injury coverage, in addition to uninsured/underinsured motorist
coverage (UM/UIM). Ibid. Felix was insured under a policy with Geico that
had been written and executed in Florida. Ibid. The Geico policy afforded up
to $10,000 for personal injury protection and property liability benefits, but
failed to provide any coverage for bodily injury. Ibid. Felix sued Richards for
personal injuries, and Richards countersued both Felix and AAA. Ibid.
AAA filed a third-party complaint naming Geico as a defendant, arguing
Geico was liable to AAA for up to the amounts allowed pursuant to the
Deemer Statute, and that this payment would eliminate any UM/UIM payments
that Richards was entitled to from AAA. Ibid. AAA and Geico filed motions
for summary judgment, and the motion judge found in favor of AAA,
determining that the Deemer Statute required that Geico provide coverage
equivalent to the mandatory minimum of $15,000 per person or $30,000 per
accident. Id. at 176-77. On appeal, we affirmed the decision of the motion
judge. Id. at 177. Geico appealed our decision, and our Supreme Court
granted certiori. Ibid.
The Supreme Court held that, in addition to in-state insurers that write
policies in New Jersey, insurers such as GEICO that have issued an out-of-
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state policy but that also write auto policies in New Jersey remain obligated
under the Deemer Statute to guarantee New Jersey's $15,000/$30,000 bodily
injury liability limits in their out-of-state policies, regardless of the actual
terms of those policies. Id. at 173-75. The Court concluded that although our
Legislature had enacted two alternative forms of lesser insurance coverage
since the enactment of the Deemer Statute, this "does not alter the compulsory
obligation of both categories of insurers to offer and provide the same de fault
minimum level of coverage." Id. at 175.
Relying on Felix, it is clear that Travelers is liable to plaintiff for bodily
injury damages less than or equal to the $15,000 per person limits established
in the Deemer Statute. See N.J.S.A. 17:28-1.4. Under the express terms of the
Travelers policy, Travelers was only liable for bodily injury coverage if the
insured was legally responsible for coverage due to their fault in an accident.
The Travelers intrafamily exclusion barred any such coverage for "bodily
injury to [the named insured or a spouse] or a family member."
However, the Travelers out-of-state policy provided that, in the event
plaintiff would become injured in an accident in another state, the Travelers
policy would be interpreted to conform with any law of that state "requiring a
nonresident to maintain insurance whenever the nonresident uses a vehicle in
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that state or province," and that the Travelers policy would provide plaintiff
with "at least the required minimum amounts and types of coverage." As such,
the Travelers policy contemplated that where an applicable statutory minimum
existed for bodily injury to the insured, such as that imposed by the Deemer
Statute, Travelers would cover bodily injury for the insured up to the statutory
minimum.1 As the recent Felix decision highlights, the existence of alternative
basic and standard policies available as coverage options for New Jersey
policyholders does not eliminate this overriding requirement, and Travelers is
thus liable for the statutory minimum for bodily injury coverage afforded
under the statute, an amount not to exceed $15,000. See Felix, 241 N.J. at
173-75.
Our holding that the Deemer Statute governs Travelers' liability to
plaintiff obviates the need to engage in a choice-of-law analysis. See George
J. Kenny & Frank A. Lattal, New Jersey Insurance Law § 21-10 (2019). This
practice is reflected in prior court decisions. See Hamilton v. Gov. Employees
Ins. Co., 283 N.J. Super. 424, 429 (App. Div. 1995) ("When N.J.S.A. 17:28-
1
See Gov't Emps. Ins. Co. v. Allstate Ins. Co., 358 N.J. Super. 555, 560 (App.
Div. 2003) (explaining that "[p]olicies subject to the [Deemer] statute that do
not contain express provisions complying with the statute . . . are [nonetheless]
deemed to comply").
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1.4 applies, there is no choice-of-law issue."). More succinctly, "N.J.S.A.
17:28-1.4 makes the underlying out-of-state policies, and the laws of the
jurisdictions in which those policies are issued, irrelevant to the extent that it
mandates New Jersey coverage[.]" State Farm Mut. Auto. Ins. Co. v. Crocker,
288 N.J. Super. 250, 255 (App. Div. 1996) (citing D'Orio v. West Jersey
Health Systems, 797 F. Supp. 371, 373-74 (D.N.J. 1992)).2 As such, we
conclude that Travelers is liable to plaintiff for bodily injury coverage in an
2
We did engage in a choice-of-law analysis in one prior decision where the
Deemer Statute applied. See Moper Transp. v. Norbet Trucking, 399 N.J.
Super. 146, 153-58 (App. Div. 2008). However, the Moper decision is unique.
In Moper, two New York residents got into an accident on Staten Island. Id. at
148-49. One drove a car registered in New York. Id. at 149. The other, the
sole shareholder of a corporation based in New Jersey, drove a tractor that was
registered in New Jersey. Id. at 148-49. The corporation also leased the
tractor to a New Jersey trucking company prior to the accident, and the
companies had executed a transportation services agreement that had subjected
the companies to the laws of New Jersey, and also instituted a non-trucking
business use exclusion that applied when driving the tractor. Id. at 149-50.
The plaintiff initially filed a claim in New York, but the New York court in
part determined that New Jersey had a more significant interest in adjudicating
the matter based on the existence of these various agreements and the parties’
ties to New Jersey. Id. at 150-52. In rendering our decision, we specifically
stated that we engaged in a choice-of-law analysis principally because both
New York and New Jersey have Deemer statutes, and because whether
coverage existed relied, in part, on whether the tractor had been driven for a
business purpose, which would have implications depending on which statute
applied. Id. at 154-55. In light of the specific facts underlying our opinion in
Moper, we do not find that Moper requires us to engage in a choice-of-law
analysis in the present matter.
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amount not to exceed the statutory minimum afforded under the Deemer
Statute, that being $15,000 for her physical injuries. Moreover, since there
was no coverage for intrafamily claims, Travelers' liability was not required to
provide more than the amount required by the Deemer Statute, as compared to
a claim for which there was coverage but in an amount less than what was
required by New Jersey.
We thus reverse the decisions of the motion judge granting of summary
judgment to plaintiff and denying summary judgment to Travelers, and
denying Travelers' motion for reconsideration. We remand the matter back to
the lower court for further proceedings consistent with this decision. To the
extent that we have not specifically addressed any other issues raised by the
parties, we find they lack sufficient merit to warrant discussion in a written
opinion. R. 2:11-3(e)(1)(E).
Reversed and remanded. We do not retain jurisdiction.
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