SUPERIOR COURT OF NEW JERSEY 

 APPELLATE DIVISION 

 DOCKET NO. A-0076-21 

MICHELLE ROCHE, 

IN HER INDIVIDUAL CAPACITY 

AND AS CLASS REPRESENTATIVE, 

 Plaintiff-Appellant, 

v.

AETNA, INC., AETNA HEALTH INC., 

AETNA INSURANCE CO. and 

AETNA LIFE INSURANCE CO., 

 Defendant-Respondent. 

_________________________________

Submitted September 19, 2023 – Decided November 28, 2023 

Before Judges Smith and Perez Friscia. 

On appeal from the State Employees' Health Benefits

Commission. 

Ryan Nicholson Boland (Offit Kurman, PC) and 

Charles Kannebecker, attorneys for appellant (Ryan 

Nicholson Boland and Charles Kannebecker, on the 

briefs). 

Anthony Michael Christina (Lowey Dannenberg, PC) 

attorney for respondents Aetna Inc., Aetna Health Inc., 

NOT FOR PUBLICATION WITHOUT THE 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.
2 A-0076-21

Aetna Insurance Co., and Aetna Life Insurance Co. 

(Anthony Michael Christina, on the brief). 

Matthew J. Platkin, Attorney General, attorney for 

respondent School Employees' Health and Benefits 

Commission (Melissa H. Raska, Assistant Attorney 

General, of counsel; Alison Keating, Deputy Attorney 

General, on the brief). 

PER CURIAM 

 Plaintiff Michelle Roche appeals the final decision of the School 

Employees Health Benefits Commission (Commission) rejecting her appeal as 

untimely filed. Roche argues Aetna issued a defective adverse benefits 

determination, which relieved her of the obligation to file an appeal within 180 

days. For the reasons which follow, we affirm. 

I.

In 2007 Roche sustained serious injuries in a motor vehicle accident. She 

sued the tortfeasor and obtained a monetary recovery. At all relevant times, 

Roche was enrolled in the School Employees Health Benefits Program (SEHBP) 

through an HMO plan administered by defendant Aetna Life Insurance 

Company (Aetna)1. The SEHBP paid $86,601.72 in benefits for medical 

1

 We refer to defendants, Aetna, Inc., Aetna Health Inc., Aetna Insurance Co., 

and Aetna Life Insurance Co., collectively as "Aetna" throughout this opinion. 
3 A-0076-21

treatment Roche received in 2009 and 2010. From September 2010 through July 

2012, Aetna, through its agent, the Rawlings Company, LLC (Rawlings), sent 

Roche a series of letters, in which Aetna asserted its right to be reimbursed from 

any proceeds she recovered in her personal injury lawsuit. 

SEHBP detailed its plan terms in a handbook titled, "Aetna Member 

Handbook for Employee and Retirees Enrolled in the State Health Benefits 

Program." The 2009 and 2010 Handbooks, at page 59, include a paragraph 

entitled, "Reimbursement." It states in full: 

In addition, if a Covered Person receives any payment 

from any Responsible Party or Insurance Coverage as a

result of an injury, illness, or condition, the Plan has the 

right to recover from, and be reimbursed by, the 

Covered Person for all amounts this Plan has paid and 

will pay as a result of that injury, illness, or condition, 

up to and including the full amount the Covered Person

receives from any Responsible Party. 

Roche, through her counsel, reimbursed Aetna $88,075.29 on January 4, 

2013. Shortly afterwards, Roche filed a class action complaint in the Superior 

Court of New Jersey on May 28, 2013. Her complaint alleged, "Aetna engaged 

in illegal subrogation, in violation of New Jersey Law, which prohibits insurers 

from subrogating against personal injury insurers." Aetna removed her claim to 
4 A-0076-21

the United States District Court for the District of New Jersey (Roche I)2 and 

filed a motion to dismiss. Aetna argued that their subrogation of Roche's 

settlement was permissible, and that Roche failed to exhaust her administrative 

remedies pursuant to the appeals requirements under her insurance policy as 

detailed in the 2009-10 Aetna Handbooks. The Handbooks, at page 55, contain 

a paragraph entitled, "Appeals of Adverse Benefits Determinations." The 

pertinent language states: 

Adverse benefit determinations [(ABD)] are decisions 

Aetna makes that result in denial, reduction, or 

termination of a benefit or the amount paid for it. It 

also means a decision not to provide a benefit or 

service. 

. . . . 

Aetna will send you written notice of an adverse 

benefits determination. The notice will give the reason

for the decision and will explain what steps you must 

take if you wish to appeal. The notice will also tell you 

about your rights to receive additional information that 

may be relevant to the appeal. Requests for appeal must 

be made in writing within 180 days from the receipt of 

the notice. 

. . . . 

The Plan provides for two levels of appeal, plus an

option to seek external review of the ABD. You must 

2

 Roche v. Aetna, Inc., 165 F. Supp. 3d 180 (D.N.J. Feb 29, 2016). 
5 A-0076-21

complete the two levels of appeal before bringing a

lawsuit against the plan. 

. . . . 

If the Plan's appeals process upholds the original 

adverse benefits determination, you may have the right 

to pursue a Health Benefits Commission review of your 

claim. 

[emphasis added]. 

The district court found the Rawlings letters constituted an adverse 

benefits determination, and that Roche was required "to seek administrative 

review before filing suit" even though the letters lacked specific notice regarding 

administrative appeal steps. Roche, 165 F. Supp. 3d at 187. The court noted 

Roche possessed the SEHBP handbook and could read the appeals process on 

her own. Id. at 188. The district court granted defendants' motion to dismiss 

without prejudice and ordered Roche to exhaust her administrative remedies 

prior to filing a class action complaint. 

Roche appealed to the Third Circuit (Roche II)3 on March 28, 2016, which 

affirmed the exhaustion of remedies requirement. It also noted Roche was "in 

possession of the appeal procedures" contained in the handbook. Roche, 681 F. 

App'x at 124. 

3

 Roche v. Aetna, Inc., 681 F. App'x 117 (3d Cir. Mar. 9, 2017). 
6 A-0076-21

Next, in 2017, Roche filed an appeal with the New Jersey Department of 

Banking and Insurance (DOBI), citing "exemplar contracts produced by Aetna 

in the district court litigation which expressly authorized a first level appeal to 

[DOBI]". DOBI declined jurisdiction. 

Over a year later, Roche sought an appeal hearing through the New Jersey 

Division of Pensions and Benefits (Division), to be heard before the State Health 

Benefits Commission (SHBC), an entity that is separate and distinct from the 

Commission. The Division declined jurisdiction as well. 

Finally, in 2019, six years after she sued Aetna in a class action lawsuit to 

contest her adverse benefits determination, Roche filed her first and second level 

internal appeals with Aetna. After some delay, Aetna denied both appeals. 

Roche then filed her first SEHBC appeal on November 13, 2019. 

The SEHBC heard argument by the parties and found Roche's appeal 

untimely in an initial decision dated June 19, 2020. The SEHBC issued its final 

administrative decision on July 26, 2021, finding the Rawlings letters 

constituted an adverse benefits determination pursuant to the terms of the 

Handbook, and that the absence of an appeals notice within the letters was not 

"fatal." 
7 A-0076-21

On appeal, Roche contends her appeal should not be barred on timeliness 

grounds because: defendants failed to provide her with an adverse benefit 

determination letter containing proper notice language; defendants breached 

their duty of good faith and fair dealing and are equitably estopped from 

asserting the timeliness defense; defendants waived their untimeliness defense; 

and Roche was not required to exhaust administrative remedies. 

II. 

Appellate "review of administrative agency action is limited." Russo v. 

Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J. 14, 27 (2011) (citing In re 

Herrmann, 192 N.J. 19, 27 (2007)). "A reviewing court 'may not substitute its 

own judgment for the agency's, even though the court might have reached a 

different result.'" In re Stallworth, 208 N.J. 182, 194 (2011) (quoting In re 

Carter, 191 N.J. 474, 483 (2007)). The appellate court may reverse a decision 

"if it is arbitrary, capricious, or unreasonable, or if it is not supported by 

substantial credible evidence in the record as a whole." P.F. on Behalf of B.F. 

v. New Jersey Div. of Dev. Disabilities, 139 N.J. 522, 529–30 (1995) (citing 

Dennery v. Bd. of Educ., 131 N.J. 626, 641 (1993)). We defer to an agency's 

"technical expertise, its superior knowledge of its subject matter area, and its 

fact-finding role." Messick v. Bd. of Review, 420 N.J. Super. 321, 325 (App. 
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Div. 2011). However, the appellate court applies "de novo review to an agency's 

interpretation of a statute or case law." Russo, 206 N.J. at 27 (citing Toll Bros., 

Inc. v. Twp. of W. Windsor, 173 N.J. 502, 549 (2002)). 

III. 

Roche's main points on appeal are all premised upon the same contention: 

her 180-day appeal deadline, clearly stated on page 55 of her 2009 and 2010 

Handbooks, was not triggered because defendants never satisfied the condition 

precedent of providing a proper adverse benefit determination to her. She 

maintains the handbook unambiguously requires that an adverse benefit 

determination must contain: a reason for the decision; an explanation of the 

steps the insured must take to appeal; and an explanation of the insured's right 

to receive additional information relevant to the appeal. She contends the 

Rawlings letters do not meet these requirements. We are not persuaded. 

"The parties to a contract 'may make contractual liability dependent upon 

the performance of a condition precedent.'" Liberty Mut. Ins. Co. v. President 

Container, Inc., 297 N.J. Super. 24, 34 (App. Div. 1997) (quoting Duff v. 

Trenton Beverage Co., 4 N.J. 595, 604 (1950)). A condition precedent is an 

event that must happen before a contractual right accrues or a contractual duty 

arises. Restatement (Second) of Contracts § 224 (Am. L. Inst. 1981). 
9 A-0076-21

"[G]enerally, 'no liability can arise on a promise subject to a condition precedent 

until the condition is met.'" Duff, 4 N.J. at 604. And "because a promisor's duty 

does not become absolute unless and until the condition precedent occurs, the 

failure or non-performance of the condition is a defense to an action against the 

promisor for breach of its promise." 4 Williston on Contracts § 38.7 (Lord ed. 

2013). 

We quote the clear and succinct findings of the Commission:

First, the Commission concludes the Rawlings Letters 

are an adverse benefit determination as defined by the 

Handbooks. In doing so, the Commission adopts the 

finding in Roche II that the exercise of the SEHBP’s 

right of recovery to request reimbursement for the 

amount paid to cover Roche’s medical expenses after 

her receipt of settlement proceeds is "unquestionably" 

an adverse benefit determination. 681 Fed. Appx. at 

122. The Commission also adopts the finding in Roche 

I that the Rawlings [l]etters give the reason for the 

decision, as they "very clearly state why" the SEHBP 

believes it can exercise its right of recovery. 165 F. 

Supp. 3d. at 188. Thus, the Rawlings letters serve as a 

written notice of an adverse benefit determination and 

give the reason for the decision. Second, the lack of 

notice regarding the Roche appeal procedures in the

Rawlings [l]etters is not fatal. The Commission follows 

Roche II and concludes the "initial lack of notice of [the 

appeal] procedures d[oes] not extinguish the 

[SEHBP’s] exhaustion requirement." 681 Fed. Appx. 

at 124. As the Third Circuit reasoned, "Roche was in 

possession of the appeal procedures and offers no 

reason for why she could not have appealed other than 

her mistaken belief that no adverse benefit 
10 A-0076-21

determination had been made." Ibid. The Commission

also follows Roche I, 165 F. Supp. 3d at 188, and adopts 

the reasoning of the court in Neuner v. Horizon Blue 

Cross Blue Shield of N.J. (In re LymeCare, Inc.), 301 

B.R. 662, 667 (Bankr. D.N.J. 2003), which found 

members of the State Health Benefits Plan had "all of 

the information regarding the appeal procedures . . . 

available to them in the plan handbook" and were, 

therefore, required to exhaust administrative remedies, 

even though they did not get proper claims denial 

notices. As the court in Neuner reasoned, any 

unfairness to Roche occasioned by the initial lack of 

notice of the appeal procedures "is mitigated by the fact 

that the Plan Handbook, which has been readily 

available to [members], clearly reflects the 

administrative course for appeal[s]." 

[Ibid.] 

We defer to the Commission's findings, Messick, 420 N.J. Super. at 325

and discern no reason to disturb the Commission's adoption of the sound legal 

reasoning expressed by the federal district court in Roche I and the Third Circuit 

in Roche II. We find no error. 

 Next, Roche argues defendants breached their duty of good faith and fair 

dealing when they failed to produce a "compliant notice of adverse benefits 

determination and/or Aetna's contract with the SEHBC." We disagree. 

The implied covenant of good faith and fair dealing requires parties to a 

contract to "refrain from doing 'anything which will have the effect of destroying 

or injuring the right of the other party to receive' the benefits of the contract." 
11 A-0076-21

Brunswick Hills Racquet Club, Inc. v. Route 18 Shopping Ctr. Assocs., 182 N.J. 

210, 224-25 (2005) (quoting Palisades Props., Inc. v. Brunetti, 44 N.J. 117, 130 

(1965)). 

 Aetna contracted with the SEHBC to provide health benefits services to 

SEHBC members. There was no contract between Aetna and Roche. "In the 

absence of a contract, there can be no breach of an implied covenant of good 

faith and fair dealing." Noye v. Hoffmann-La Roche, Inc., 238 N.J. Super. 430, 

434 (App. Div. 1990). Even if we were to find privity between the parties, and 

that Aetna owed Roche a duty of good faith and fair dealing, that duty was not 

breached here, as the Commission properly found defendants provided an 

adequate adverse benefits determination to Roche. 

 We reject Roche's equitable estoppel and waiver arguments as without 

merit. They represent variations on Roche's lack of notice argument, which we 

have declined to adopt. On this record, we find that application of differing 

legal theories to the same facts do not alter the outcome. 

 Finally, the Employee Retirement Income Security Act of 1974 (ERISA) 

is not applicable to the SEHBP. See 29 U.S.C. §§ 1002(32)1003(b)(1). Its 

related jurisprudence is not persuasive. 
12 A-0076-21

 To the extent we have not addressed any additional arguments by Roche, 

it is because they lack sufficient merit discussion in a written opinion. R. 2:11-

3(e)(1)(E). 

 Affirmed.