Filed: Jun. 06, 2003
Latest Update: Mar. 02, 2020
Summary: Opinions of the United 2003 Decisions States Court of Appeals for the Third Circuit 6-6-2003 Dieng v. Entr Rent A Car Precedential or Non-Precedential: Non-Precedential Docket No. 01-3935 Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2003 Recommended Citation "Dieng v. Entr Rent A Car" (2003). 2003 Decisions. Paper 478. http://digitalcommons.law.villanova.edu/thirdcircuit_2003/478 This decision is brought to you for free and open access by the Opinions
Summary: Opinions of the United 2003 Decisions States Court of Appeals for the Third Circuit 6-6-2003 Dieng v. Entr Rent A Car Precedential or Non-Precedential: Non-Precedential Docket No. 01-3935 Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2003 Recommended Citation "Dieng v. Entr Rent A Car" (2003). 2003 Decisions. Paper 478. http://digitalcommons.law.villanova.edu/thirdcircuit_2003/478 This decision is brought to you for free and open access by the Opinions ..
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Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit
6-6-2003
Dieng v. Entr Rent A Car
Precedential or Non-Precedential: Non-Precedential
Docket No. 01-3935
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2003
Recommended Citation
"Dieng v. Entr Rent A Car" (2003). 2003 Decisions. Paper 478.
http://digitalcommons.law.villanova.edu/thirdcircuit_2003/478
This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
University School of Law Digital Repository. It has been accepted for inclusion in 2003 Decisions by an authorized administrator of Villanova
University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.
NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
____________
Nos. 01-3935; 02-3663; 02-3902
____________
BINTOU K. DIENG, as the Intended Third Party Beneficiary of
the Policy of Insurance/Self-Insurance Issued to Enterprise
Rent-a-Car and individually; OUMOU DIENG, as the Intended
Third Party Beneficiary of a Policy of Insurance/Self
Insurance Issued to Enterprise Rent-a-Car and individually;
ESTATE OF SOUKAINA COLY, by and through Papa Diop
Administrator ad Prosequendum, as the Intended Third-Party
Beneficiary of a Policy of Insurance/Self-Insurance Issued
to Enterprise Rent-a-car and individually; ESTATE OF AWA
DIENG, by and through Ibrahima Sene, Administrator ad
Prosequendum, as the Intended Third-Party Beneficiary of a
Policy of Insurance/Self Insurance Issued to Enterprise
Rent-a-Car and individually; ESTATE OF ASSIETOU DIENG, by and
through Ibrahima Sene, Administrator ad Prosequendum, as the Intended
Third-Party Beneficiary of a Policy of Insurance/Self Insurance Issued to
Enterprise Rent-a-Car and individually
Appellants in No. 02-3902
v.
ENTERPRISE RENT-A-CAR; ELCO ADMINISTRATIVE SERVICES,
jointly, severally and/or in the alternative
Enterprise Rent-A-Car and Elco Administrative Services,
Appellants in Nos. 01-3935 & 02-3663
____________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
(D.C. Civ. No. 00-cv-05764 )
District Judge: Honorable Jerome B. Simandle
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Argued April 23, 2003
Before: SCIRICA, Chief Judge,* AMBRO and W EIS, Circuit Judges.
(Filed: June 6, 2003)
____________
Christopher A. Jeffreys, Esquire (ARGUED)
Law Offices of Christopher A. Jeffreys, P.C.
Pro Hac Vice Counsel
425 Broad Hollow Road
Melville, New York 11747
Kent & McBride, P.C.
1040 Kings Highway North, Suite 403
Cherry Hill, New Jersey 08034
Attorneys for Defendants-Appellants/Cross-Appellees Enterprise Rent-A-Car, ELCO
Administrative Services
Mark S. Gertel, Esquire (ARGUED)
Gertel & Feld, P.C.
1040 North Kings Highway, Suite 725
Cherry Hill, New Jersey 08034
Attorneys for Plaintiffs-Appellees/Cross Appellants Bintou K. Dieng, et. al.
_______________
OPINION
_________________________
* Judge Scirica began his term as Chief Judge on May 4, 2003.
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WEIS, Circuit Judge.
This case is a declaratory judgment action originally filed in the New Jersey
Superior Court and later removed to the United States District Court for the District of
New Jersey. The primary issue is the applicability of New Jersey’s “deemer statute,”
N.J.S.A. 17:28-1.4, a provision of that state’s automobile insurance legislation.
In general, the “deemer statute” requires companies authorized to transact
insurance business in New Jersey to provide in their policies personal injury protection
benefits such as medical bills and funeral expenses. The statute makes such coverage
available to accident victims injured within New Jersey, regardless of their domicile and
whether the insurance policy covering the accident was purchased outside the state.
The plaintiffs in this case were the driver and passengers of a car leased in
Virginia from the Enterprise Leasing Company, a Virginia corporation wholly owned by
Enterprise Rent-A-Car, a Delaware Corporation. To insure the vehicle, Rent-A-Car filed
a certificate of self-insurance with the New Jersey Department of Insurance in accordance
with that state’s requirements. Plaintiffs filed suit against Rent-A-Car as the vehicle’s
insurer to recover personal injury protection benefits.
The District Court, in a well-reasoned opinion, concluded that it had
personal jurisdiction over Rent-A-Car by virtue of its New Jersey registration, that New
Jersey rather than Virginia law should apply, and that under New Jersey law, self-
insurance is the equivalent of a policy of insurance. See Ryer/P.I.E. Nationwide, Inc. v.
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Harbor Bay Corp., Inc., 575 A.2d 416 (N.J. 1990). As a result, Rent-A-Car was required
to pay personal injury protection benefits to the plaintiffs, all of whom were non-residents
of New Jersey.
After careful review of the record, including the thorough briefs of counsel,
and having had the benefit of excellent oral argument, we conclude that the District Court
arrived at the correct result in determining eligibility for PIP benefits. The District
Court’s careful and comprehensive opinion analyzed the contested issues and, in our
view, accurately predicted what the New Jersey Supreme Court would hold in a similar
case.
We point out once again that the grant of a declaratory judgment in the
federal courts is discretionary, and must “yield to considerations of practicality and wise
judicial administration.” State Auto Ins. Cos. v. Summy, 234 F.3d 131, 134 (3d Cir.
2000) (citing Wilton v. Seven Falls Co.,
515 U.S. 277, 288 (1995)). Particularly when the
issue is the novel interpretation of a state statute concerned with the terms of insurance
policies, disputes are better resolved in the first instance in the state system. Those courts
can issue a definitive ruling on the legal contentions, rather than render a prediction of
what the highest court of the state would decide.
A certification procedure to the state supreme court is an option in resolving
the issues here. However, we deem it inappropriate particularly in this case where the
defendant removed the declaratory judgment from the state court where it was originally
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filed, and chose to litigate the issue in the federal courts.
The District Court denied plaintiffs’ request for attorneys’ fees under New
Jersey Court Rule 4:49(a)(6), noting that the plaintiffs are first-party claimants seeking
direct benefits from the defendant. The Rule provides that: “[no] fee for legal services
shall be allowed in the taxed costs or otherwise, except . . . [i]n an action upon a liability
or an indemnity policy of insurance, in favor of a successful claimant.” On its face, the
Rule would prohibit the award of attorneys’ fees in cases such as the one before us.
The New Jersey Supreme Court has only obliquely addressed the issue. In
Darel v. Pennsylvania Mfg. Assoc. Ins. Co., 555 A.2d 570 (N.J. 1989), the Court
conceded that although the propriety of the award of fees in that PIP case had neither
been briefed nor argued, the “exercise of discretion” in awarding the fee “is sustainable.”
The Court did not discuss the Rule or even cite to it.
In Maros v. Transamerican Ins. Co., 388 A.2d 971, 974 (N.J. 1978), the
Court stated that “counsel fees are discretionary when actions on an insurance policy is
involved.” Again, the Court did not cite to the Rule, and it is clear that the expansive off-
hand comment is inconsistent with the text and the Court’s subsequent actions. See also
Enright v. Labou,
521 A.2d 1300 (N.J. App. Div. 1987) (observing that the Supreme
Court Committee on Counsel Fee Awards had recommended the Rule not be changed to
allow recovery in first-party claims against insurance companies. The Court did not
expand the Rule following that Committee report.).
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Cirelli v. Ohio Cas. Co., 371 A.2d 17, 19 (N.J. 1977) was the Court’s first
encounter with a PIP claim case. In approving an award of a fee, the Court cited the
Rule, but did not explain its application to that first-party action. Thus, a review of the
New Jersey Supreme Court opinions does not offer any clear exposition of its application
of the Rule in PIP cases.
However, despite the language of the Rule, the New Jersey Superior Court
Appellate Division, in a series of opinions, has permitted the discretionary award of fees
in PIP cases. See, e.g., Scullion v. State Farm Ins. Co., 785 A.2d 469 (N.J. App. Div.
2001); Helton v. Prudential Prop. & Cas. Co.,
500 A.2d 717 (N.J. App. Div. 1985).
In Pressler, Rules Governing The Courts of the State of New Jersey, 1612
(2003 ed.), the author states:
“Since the stated intention of the Rule was to permit an
award of counsel fees only where an insurer refused to
indemnify or defend in respect to its insured’s third-party
liability to another, it should not be extended, beyond its
express terms, to permit a counsel fee . . . to an insured who
brings a direct suit against his insurer to enforce casualty or
other direct coverage including UM/UIM coverage.”
However, citing numerous cases, the commentary continues “[s]uch a fee is, however,
allowable in personal injury protection benefits actions where the insured counsel is
successful.” To support this exception to the Rule, Pressler cites to the Supreme Court
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opinions noted above, as well as numerous cases of the Appellate Division of New Jersey.
The defendant relies upon language in Eagle Fire Prot. Corp. v. First Indem.
of America Co., 678 A.2d 699 (N.J. 1996), in which the New Jersey Supreme Court
referred to the commentary, asserting that counsel fees should be awarded only in third-
party cases. Although counsel fees were there denied, that case involved a surety bond,
not a casualty insurance policy, and the Court did not discuss the PIP situation.
Consequently, Eagle Fire does not govern the defendant’s cause.
The argument that the Rule’s language excludes all first-party cases,
including PIP, is a strong one. In reality, however, it appears that the Appellate Division
has concluded that PIP is an exceptional situation beyond the scope of the Rule. The
New Jersey Supreme Court is apparently content to allow this reading to prevail, an
approach which we, as a result, are constrained to follow as well. In these circumstances,
we believe that, in its discretion, the District Court did have authority to allow counsel
fees. Accordingly, we will remand to the District Court so that it may exercise its
discretion. We intimate no view on whether counsel fees should be awarded or in any
amount.
The Judgment of the District Court will be affirmed on the ruling in favor
of the plaintiffs on eligibility for PIP benefits. The order denying counsel fees will be
reversed, and the matter will be remanded to the District Court for further consideration
consistent with this Opinion.
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______________________________
TO THE CLERK:
Please file the foregoing Opinion.
/s/ Joseph F. Weis, Jr.
United States Circuit Judge
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