WAYNE SAVAGE VS. PROGRESSIVE INSURANCE COMPANYÂ (L-4048-14, ESSEX COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE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-3358-15T2
WAYNE SAVAGE,
Plaintiff-Appellant,
v.
PROGRESSIVE INSURANCE CO.,
Defendant-Respondent,
and
A.T.
Defendant.
____________________________________________
Submitted July 13, 2017 – Decided July 27, 2017
Before Judges Yannotti and Haas.
On appeal from Superior Court of New Jersey,
Law Division, Essex County, Docket No. L-4048-
14.
Wayne Savage, appellant pro se.
Kent & McBride, P.C., attorneys for respondent
(Bradley R. Lawrence, on the brief).
PER CURIAM
Plaintiff Wayne Savage appeals from an order entered by the
Law Division on February 26, 2016, dismissing plaintiff's claims
against defendant Progressive Insurance Company (Progressive) with
prejudice. We affirm.
We briefly summarize the relevant facts and procedural
history. On January 28, 2014, plaintiff filed a complaint in the
Special Civil Part against Progressive and a person we refer to
as A.T., asserting a claim under the Consumer Fraud Act (CFA),
N.J.S.A. 56:8-1 to -20, based on Progressive's alleged wrongful
rescission of an automobile insurance policy. Plaintiff claimed
he acquired the policy on December 10, 2013.
It appears that plaintiff was in an automobile accident on
January 8, 2014. According to the complaint, a police officer
contacted Progressive to confirm that plaintiff had auto
insurance, but Progressive informed the officer that plaintiff did
not have coverage. Plaintiff sought treble damages pursuant to the
CFA.1
Because plaintiff was seeking damages that exceed the
jurisdiction monetary limits of the Special Civil Part, the court
transferred the case to the Civil Part. Progressive then filed an
answer denying liability. The court later denied Progressive's
motion for summary judgment and conducted a bench trial in the
matter.
1
The court later dismissed the complaint as to A.T. apparently
because the complaint was never served upon him.
2 A-3358-15T2
At the trial, plaintiff testified that on December 5, 2013,
he purchased a used Dodge automobile, and on December 10, 2013,
he went to Rallye Motors, another used car dealership, to arrange
for the purchase of automobile insurance. Plaintiff spoke with
A.T., an individual whom he knew at Rallye Motors. Plaintiff said
A.T. had previously assisted him in purchasing auto insurance for
his daughter. Plaintiff told A.T. he wanted the best coverage at
the lowest price.
A.T. contacted Progressive and he gave plaintiff a quote for
coverage. Plaintiff agreed to purchase the coverage for a total
premium of $2700, which he would pay in installments. Plaintiff
said he gave A.T. $593 in cash. Plaintiff claimed he was supposed
to pay the remaining installments with electronic transfers of
money from an account. Plaintiff claimed A.T. gave him a receipt
but he could not produce it.
Plaintiff testified that he had been living with his sister
in an apartment in Newark. Plaintiff was no longer living at that
location, but he was still receiving his mail there. He stated
that he had received a "welcome package" from Progressive, which
included a five-page application for insurance.
The application stated that the policy was for the period
from December 10, 2013, to June 10, 2014, with a total premium of
$2967, which would be paid in five installments. The first
3 A-3358-15T2
installment payment was $593.40. The application stated that the
initial payment had been received.
The application indicated that the initial payment would be
made with funds transferred from a checking account, which was
identified by the last four digits of both the account and the
routing number. The application stated:
This is to confirm the authorization you gave
for your first installment payment to be made
by [electronic funds transfer]. This
authorization applies to your first
installment only. After your first installment
payment, we cannot withdraw funds from your
checking account for future payments unless
you provide us with another authorization. An
authorization form is included in this
package.
In another section, the application form contained the
following statement:
If I make my initial payment by electronic
funds transfer, check, draft, or other
remittance, the coverage afforded under this
policy is conditioned on payment to the
Company by the financial institution. If the
transfer, check, draft, or other remittance
is not honored by the financial institution,
the Company shall be deemed not to have
accepted the payment and this policy shall be
void.
On cross-examination, plaintiff again stated that he had
provided A.T. with cash for the first installment payment, but he
did not have a receipt for the payment. Plaintiff conceded that
4 A-3358-15T2
he never mailed cash, a money order, or a check to Progressive.
He claimed that A.T. told him he sent the money to Progressive.
Plaintiff acknowledged that a few days after he arranged for
coverage, he received a package of documents from Progressive but
he claimed he only read the first page. Plaintiff said he did not
read the page with the authorization of an electronic transfer of
funds from an account for the first payment.
Progressive's attorney asked plaintiff whether he read the
part of the application form which states that if the initial
payment is not honored by a financial institution, the policy
"shall be void." Plaintiff said he read this part of the
application but claimed it did not apply to him because he had not
paid by check. Progressive's attorney asked plaintiff if he signed
and returned the application to Progressive, and he replied that
he could not recall but he "could have."
Progressive's attorney then showed plaintiff a rescission
notice dated December 16, 2013. He acknowledged that his name and
policy number were on the notice, and the address was his mailing
address in Newark. Plaintiff also acknowledged that the police
officer had given him a ticket for failing to maintain auto
insurance. Plaintiff said he pled guilty to the charge and paid a
fine, but he was going to appeal if he succeeded in this case.
5 A-3358-15T2
Progressive presented testimony from Debra Henry (Henry), a
defense litigation specialist for the company. Ms. Henry was
responsible for investigating coverage disputes regarding auto
insurance policies. She reviewed plaintiff's file, including the
documents Progressive sent to plaintiff. Ms. Henry testified that
plaintiff had obtained a "direct policy," which means that a
Progressive agent did not arrange for the insurance.
Ms. Henry said that in this case, someone had asked
Progressive for a price quote, an application was made, and the
company asked for payment information. She noted that Progressive
accepts payments from policyholders through a bank or financial
institution. Policyholders also may pay the company directly using
a check or credit card. Progressive does not, however, allow cash
payments for its policies. When the company receives banking
information, the company's customary practice is to generate and
mail policy documents to the customer.
Ms. Henry further testified that in this case, the financial
institution had informed Progressive that plaintiff's payment had
been rejected. Progressive then issued a rescission notice dated
December 16, 2013, which the company mailed to plaintiff at his
Newark address. The notice stated that Progressive had rescinded
the policy.
6 A-3358-15T2
Ms. Henry explained Progressive's process for mailing its
notices. Progressive mails out notices regarding policies with
certain addresses and locations at the same time. The letters are
processed and a representative from the United States Postal
Service (USPS) comes to Progressive's mail facility in Cleveland,
and stamps the manifest, which constitutes a certified report of
the mailings. Thereafter, a postal worker picks up the mail. Ms.
Henry identified the rescission notice and said it was a true copy
of the notice mailed to plaintiff.
The trial judge then permitted plaintiff and Progressive's
attorney to make closing arguments. Thereafter, the judge placed
an oral decision on the record. The judge noted that the basic
facts were essentially undisputed. The judge found that while
plaintiff claimed he paid A.T. cash for the first premium payment,
plaintiff did not have a receipt for the cash payment and
Progressive had no record of receiving that payment. The judge
noted that Progressive does not accept cash payments.
The judge also noted that although plaintiff had authorized
an electronic transfer of funds for the first payment, the funds
had not been transferred. The judge found that because plaintiff
did not make the initial premium payment, Progressive properly
rescinded the policy. The judge also determined that Progressive
7 A-3358-15T2
had complied with the requirements of N.J.S.A. 17:29C-10 by mailing
to plaintiff a notice stating that the policy had been rescinded.
The judge memorialized his decision in an order of judgment
dated February 26, 2016, which dismissed plaintiff's claims
against Progressive with prejudice. This appeal followed.
On appeal, plaintiff argues the trial court erred because:
(1) he had a valid receipt from Progressive stating it had received
his first installment payment; (2) he had a policy number and
valid policy at the time it was cancelled, and Progressive failed
to cancel the policy in accordance with the requirements of
N.J.S.A. 17:29C-10; (3) Progressive's witness presented no
evidence that an online transaction had taken place on December
10, 2013 (not raised below); (4) the trial judge did not remain
objective (not raised below); and (5) ambiguities in an insurance
policy should be resolved in favor of the insured (not raised
below).
We note initially the factual findings of the trial judge,
sitting without a jury, are binding on appeal if supported by
sufficient credible evidence in the record. Rova Farms Resort,
Inc. v. Inv'rs Ins. Co. of Am., 65 N.J. 474, 484 (1974) (citing
N.J. Tpk. Auth. v. Sisselman, 106 N.J. Super. 358, 370 (App. Div.),
certif. denied, 54 N.J. 565 (1969)). Our deference to the trial
court's factual findings is especially appropriate "when the
8 A-3358-15T2
evidence is largely testimonial and involves questions of
credibility." In re Return of Weapons to J.W.D., 149 N.J. 108, 117
(1997).
However, we review the trial court's decision on a question
of law de novo. Allstate N.J. Ins. Co. v. Lajara, 222 N.J. 129,
139 (2015) (citing Farmers Mut. Fire Ins. Co. of Salem v. N.J.
Prop.-Liab. Ins. Guar. Ass'n, 215 N.J. 522, 535 (2013)). Therefore,
"[a] trial court's interpretation of the law and the legal
consequences that flow from established facts are not entitled to
any special deference." Manalapan Realty v. Twp. Comm., 140 N.J.
366, 378 (1995).
We are convinced from our review of the record that there is
sufficient credible evidence in the record to support the trial
court's finding that Progressive validly rescinded the policy it
had issued to plaintiff on December 10, 2013. As the trial
testimony and documents admitted into evidence show, plaintiff
applied for a policy on December 10, 2013, but failed to make the
first premium payment. Therefore, Progressive properly rescinded
the policy.
Plaintiff argues on appeal that he had a valid receipt from
Progressive, which indicated that he made the first installment
payment. Plaintiff claimed he provided A.T. with cash for the
first payment, but he presented no evidence to corroborate that
9 A-3358-15T2
claim. Moreover, as Ms. Henry testified, Progressive does not
accept cash payments for its policies.
Furthermore, the evidence shows that Progressive had issued
that receipt based on the policy application, which stated that
plaintiff would make the first payment by means of an electronic
transfer of funds from a specified checking account. Progressive
presented evidence showing that the financial institution did not
transfer the funds and the payment was not made. Therefore,
Progressive properly declared the policy void ab initio.
The trial court's finding that Progressive acted properly by
rescinding the policy is supported by our decision in Tucker v.
Allstate Insurance Co., 195 N.J. Super. 230 (App. Div. 1984). In
that case, the plaintiff applied for auto insurance through an
agency, which submitted the application and its own check to the
insurer for the premium deposit. Id. at 232. The insurer received
the application and the check, which it deposited. Ibid.The coverage was to be retroactive to the date on which the
plaintiff signed the application. Ibid. The agent later advised
the insurer that the check that plaintiff had provided for the
premium had been returned for insufficient funds. Ibid. The insurer
declared the application null and void and rescinded coverage
retroactive to the date the coverage became effective. Ibid. We
held that the insurer "was within its rights" to declare the policy
10 A-3358-15T2
void from its inception. Id. at 234. The same conclusion applies
here.
Plaintiff also argues that Progressive failed to cancel the
policy in accordance with N.J.S.A. 17:29C-10. The statute
provides:
No written notice of cancellation or of
intention not to renew sent by an insurer to
an insured in accordance with the provisions
of an automobile insurance policy shall be
effective unless a. (1) it is sent by
certified mail or (2) at the time of the
mailing of said notice, by regular mail, the
insurer has obtained from the Post Office
Department a date stamped proof of mailing
showing the name and address of the insured
and b. the insurer has retained a duplicate
copy of the mailed notice which is certified
to be a true copy.
Here, Progressive did not cancel the policy. It declared the
policy void from its inception. See First Am. Title Ins. Co. v.
Lawson, 177 N.J. 125, 137 (2003) (finding that rescission of an
insurance policy by an insurer voids the agreement ab initio, and
treats it "as if it does not exist for any purpose"). Therefore,
the statute did not apply.
Even if Progressive's action is deemed to be a cancellation
of the policy, the record supports the trial court's determination
that Progressive complied with the requirements in N.J.S.A.
17:29C-10. As noted, Ms. Henry testified that Progressive sent the
notice to plaintiff on December 16, 2013, as shown by the mailing
11 A-3358-15T2
manifest, which listed his name and address and was date-stamped
by the USPS.
Ms. Henry further testified that Progressive retained the
rescission notice in the ordinary course of its business. She
stated that the copy of the notice presented to the court was a
full and complete copy of the notice that Progressive sent to
plaintiff on December 16, 2013.
We note that Progressive did not show that it created a
certification at the time it sent the notice to plaintiff, stating
that the duplicate was a true copy of the mailed notice. See Celino
v. Gen. Accident Ins., 211 N.J. Super. 538, 543 (App. Div. 1986)
(stating that the statute requires certification of the duplicate
as a true copy "contemporaneously" with the mailing of the
original). Even so, the trial judge properly found that Ms. Henry's
testimony and the documentary evidence established that
Progressive had retained a duplicate copy of the notice and that
the duplicate was, in fact, a true copy of the notice that
Progressive mailed to plaintiff on December 16, 2013.
Plaintiff further argues for the first time on appeal that:
Progressive failed to show that an online transaction took place
on December 10, 2013; the trial judge did not remain objective;
and certain ambiguities in the policy should be resolved in his
favor.
12 A-3358-15T2
This court will not, however, consider arguments that were
not raised in the trial court "unless the questions so raised on
appeal go to the jurisdiction of the trial court or concern matters
of great public interest." Nieder v. Royal Indemn. Ins. Co., 62
N.J. 229, 234 (1973) (quoting Reynolds Offset Co., Inc. v. Summer,
58 N.J. Super. 542, 548 (App. Div. 1959), certif. denied, 31 N.J.
554 (1960)). Because plaintiff's three additional arguments do not
concern the trial court's jurisdiction and are not of great public
interest, they will not be addressed.
Affirmed.
13 A-3358-15T2