Title: Margaret Samuel v. John Doe
Citation: N/A
Docket Number: a-216-97
State: new-jersey
Issuer: new-jersey Supreme Court
Date: April 21, 1999

(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). O'HERN, J., writing for a unanimous Court. In May 1992, twenty-one-year-old Margaret Samuel was returning from college to the home of her aunt and uncle on Long Beach Island. The vehicle she was driving was owned and insured by her father, and Samuel was an insured under the policy. Samuel stopped at a tavern on Long Beach Island. She apparently overindulged in alcoholic beverages and permitted a friend or acquaintance to drive her from the tavern. Samuel was involved in a serious one-car accident when the vehicle struck a telephone pole. When police arrived at the scene, they found no one in the driver's seat. Samuel was in the back seat with her seatbelt fastened and with serious and disabling injuries. She was unable to recall the name of the person who was driving the car, even after hypnosis. No witnesses to either the accident or the possible identity of the driver ever came forward. A manager at a local 7-Eleven convenience store said he saw someone fitting Samuel's description with two males approximately fifteen minutes before the accident. Due to the extent of Samuel's injuries, she sought compensation for her pain and suffering and permanent loss of bodily function from her insurer. A question arose as to whether she would pursue uninsured motorist benefits or liability coverage under her father's insurance policy, which had been issued by the Market Transition Facility (MTF). Samuel filed a complaint in the Law Division seeking damages allegedly caused by the driver's negligence. She used a fictitious John Doe designation for the defendant because the identity of the driver was unknown. The trial court allowed substituted service of the John Doe complaint on MTF. On an interlocutory appeal, the Appellate Division required service by publication. MTF filed a declaratory judgment action claiming that it was not obliged to indemnify or defend the fictitious defendant. It also asserted it was not required to provide uninsured (UM)/underinsured (UIM) benefits because the vehicle was insured. The parties settled Samuel's PIP claim. The trial court granted MTF's motion for summary judgment. Concerning UM/UIM coverage, the trial court concluded that the language of the policy excluded from the definition of "uninsured vehicle" any vehicle owned or furnished by the insured. The court also found that Samuel was precluded from recovering in a direct claim under the liability provisions of the policy because she could not recover judgment from the driver. It noted that the fictitious pleading rule prohibited a judgment being entered against a person designated by a fictitious name. Rule 4:26-4. On appeal, the Appellate Division agreed that Ms. Samuel was not entitled to UM/UIM coverage. Samuel v. John Doe, 309 N.J. Super. 406 (1998). It held, however, that if there were a permissive operator of the vehicle, the John Doe defendant, although unidentified, would be considered a "person" entitled to coverage under the bodily injury provisions of the policy. To ensure that Samuel's case did not "fall through the cracks," the majority ruled that the fictitious defendant rule should be relaxed under Rule 1:1-2. The court stated, however, that although Samuel need not prove the driver's identity, she has the burden of proving the existence of the driver. One member of the Appellate Division dissented in part. He saw no need to relax Rule 4:26-4. Instead, he would allow Samuel to file a counterclaim in the declaratory judgment action, in which she would have to prove she was injured by the negligence of an authorized driver of the car and that reasonable efforts were made to locate the driver. In the liability and injury action, the dissenting judge would allow the jury to consider Samuel's comparative negligence. MTF filed an appeal as of right. HELD: Samuel should be covered under the comprehensive statutory scheme for automobile insurance. The remand proceedings should be in two phases. In the first, Samuel has the burden of establishing that there was a driver other than herself operating the vehicle with her permission. If Samuel meets that burden, there should be a second proceeding in respect of injury and damages. 1. MTF's appeal is limited to the procedural issues raised by the dissent. There should be a way out of the procedural quandary to determine if there was in fact an unidentified permissive driver whose negligence caused Samuel's injuries. Although there are problems for MTF in defending an unknown driver, they are manageable. To protect the interests of the insurance company in these unusual circumstances, however, there should be a two-step proceeding. (pp. 8-11) 2. In the first proceeding, Samuel must establish that there was another person operating the automobile with her permission at the time of the accident. Rigorous discovery should be conducted to identify that person. If Samuel can establish that an unidentified person operated the vehicle, then she should be permitted to proceed against MTF as the real party in interest. Technically, a judgment is not required to make such a claim. Once it is established that there was a "covered person" who was operating the car, the insurer is contractually required to provide indemnity for that person's fault. MTF is bound to negotiate in good faith with Samuel. (pp. 11-12) 3. If a settlement cannot be reached, Samuel may sue MTF directly. A liability insurance policy creates rights not only for the policy holder but also for those to whom reparations will be made. The pleadings in the John Doe case may be amended to name MTF as the real party in interest. If MTF would prefer to avoid prejudicial reference to the existence of insurance, it can consent to the John Doe pleadings remaining in their present form. (pp. 12-14) The judgment of the Appellate Division is MODIFIED and AFFIRMED. CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, GARIBALDI, STEIN and COLEMAN join in JUSTICE O'HERN's opinion. SUPREME COURT OF NEW JERSEY A- 216 September Term 1997 MARGARET SAMUEL, Plaintiff-Respondent, v. JOHN DOE, said name John Doe being fictitious, Defendant. MARKET TRANSITION FACILITY OF NEW JERSEY, Plaintiff-Appellant, v. MARGARET SAMUEL, Defendant-Respondent, and JOHN DOE, said name being fictitious, Defendant. Argued January 20, 1999 -- Decided April 21, 1999 On certification to the Superior Court, Appellate Division, whose opinion is reported at 309 N.J. Super. 406 (1998). Kelley L. Johnson argued the cause for respondent (Pellettieri, Rabstein and Altman, attorneys; Edward Slaughter, Jr., of counsel). The opinion of the Court was delivered by O'HERN, J. This appeal presents a conundrum -- a riddle without an apparent solution -- in part because of the case's procedural posture. In May 1992, twenty-one-year-old plaintiff Margaret Samuel was returning to the home of her aunt and uncle on Long Beach Island from her college in West Virginia. After the long drive home from West Virginia, she stopped at the Ketch, a tavern on the south end of Long Beach Island. She there met old friends and made new acquaintances. Samuel appears to have overindulged and in the enjoyment of the homecoming to have made an ill-advised choice of a designated driver. All that is known for certain thereafter is that she was involved in a serious one-car automobile accident. When police arrived at the scene of the accident, they found that her car had run into a telephone pole. There was no one in the driver's seat. Samuel was in the back seat with her seatbelt fastened. She was bleeding and appeared dazed. Her injuries were serious and disabling. Because of her condition, Samuel could not later recall the name of her companion who was driving the car, even after hypnosis. The Ketch tavern appears to have been the antithesis of Cheers, the tavern of legend. The Ketch is a place where no one knows your name. No witnesses to either the accident or of the identify of the driver have ever come forward. Although no one saw Samuel leave the Ketch, a manager at a local 7-Eleven convenience store said that he saw someone fitting Samuel's description with two males approximately fifteen minutes before the accident. The automobile insurance policy on Samuel's car provided personal injury protection benefits (PIP) to cover Samuel's medical expenses and income continuation benefits; liability coverage for her bodily injuries; and uninsured motorist/underinsured motorist coverage. Due to the extent of her injuries, she sought compensation for her pain and suffering and permanent loss of bodily function. The court also found that Samuel was precluded from recovering under the bodily injury provisions of the liability policy because she had not first recovered judgment from the driver, and that such recovery would be impossible under the fictitious pleading rule if the driver remained unidentifiable. On appeal, the Appellate Division agreed with the trial court that Ms. Samuel was not entitled to coverage under the UM provisions of the policy.See footnote 1 Although the unknown operator may be thought of as an uninsured phantom or hit-and-run operator, he was not operating an unknown vehicle. The vehicle was insured. The Appellate Division held, however, that if there were a permissive operator of Mr. Samuel's vehicle, the John Doe defendant, although unidentified, would be considered a "person" entitled to coverage under the bodily injury provisions of the father's automobile insurance policy.See footnote 2 The issue that divided the panel was a procedural question -- how a judgment could be entered against a fictitious defendant. Although Rule 4:26-4 allows actions to be brought against fictitious defendants, it states that, [n]o final judgment shall be entered against a person designated by a fictitious name. Under the language of the rule, Samuel could not proceed to judgment against Doe if his name remained unknown. To ensure that Samuel's case did not fall through the cracks, thereby leaving her without coverage, 309 N.J. Super. 406, 410 (1998), the majority ruled that the fictitious defendant rule should be relaxed because justice so required under Rule 1:1-2. The court stated, however, that although plaintiff does not have to prove [the driver's] identity, she still has the burden of proving the existence of the driver. . . . Id. at 411. One member of the Appellate Division dissented in part. He saw no need to relax Rule 4:26-4. Id. at 412 (Shebell, J., dissenting). He would allow plaintiff to file a counterclaim in the declaratory judgment action. Id. at 413. He left the order of the procedures to the discretion of the trial court. Id. at 414. In the declaratory judgment action, plaintiff would be required to demonstrate that she was injured due to the negligence of an authorized driver of the car, and that reasonable efforts were made to locate the driver. Ibid. In the liability and injury action, he would have allowed a jury to consider plaintiff's comparative negligence. Ibid. MTF appealed as of right under Rule 2:2-1(a)(2). CHIEF JUSTICE PORITZ and JUSTICES HANDLER, POLLOCK, GARIBALDI, STEIN, and COLEMAN join in JUSTICE O'HERN's opinion. NO. A-216 MARGARET SAMUEL, Plaintiff-Respondent, v. JOHN DOE, etc., Defendant. MARKET TRANSITION FACILITY OF NEW JERSEY, Plaintiff-Appellant, v. MARGARET SAMUEL, Defendant-Respondent, and JOHN DOE, etc., Defendant. DECIDED N.J.S.A. 17:28-1.1e(2) defines uninsured vehicle as: (a) a motor vehicle with respect to the ownership, operation, maintenance, or use of which there is no bodily injury liability insurance . . . ; (b) a motor vehicle with respect to the ownership, operation, maintenance, or use of which there is bodily injury liability insurance in existence but the liability insurer denies coverage or is unable to make payment with respect to the legal liability of its insured . . .; (c) a hit and run motor vehicle as described in section 18 . . . . Uninsured motor vehicle shall not include . . . a motor vehicle owned by or furnished for the regular use of the named insured or any resident of the same household . . . . (emphasis added).