INSURANCE FRAUD: OMISSION OF MATERIAL FACT (CLAIMS)
(N.J.S.A.
2C:21-4.6a(1)) model jury charge
The defendant is charged in count
_____ of the indictment with insurance fraud.
[READ COUNT OF INDICTMENT]
Our
statutes provide that:
A person is guilty of a
crime... if that person knowingly...omits or causes a material fact to be
omitted from any record, bill, claim or other document, in writing,
electronically, orally or in any other form that a person attempts to submit,
submits, causes to be submitted, or attempts to cause to be submitted as part
of, in support of, or opposition to, or in connection with, a claim for
payment, reimbursement or other benefit (pursuant to an insurance policy)(from
an insurance company)(from the Unsatisfied Claim and Judgment Fund).[1]
In order to convict defendant, the
State must prove beyond a reasonable doubt the following three elements:
(1) that
the defendant knowingly omitted a fact or caused a fact to be omitted from a
record, bill, claim, or other document, in writing, electronically, orally or
in any other form;
(2) that
the defendant (CHOOSE APPROPRIATE)
(submitted)(caused to be submitted)(attempted to submit)(or attempted to cause
to be submitted) that record, bill, claim or other document, electronically,
orally or in any other form as (part of)(in support of)(in opposition to)(in
connection with) a claim for payment, reimbursement or other benefit (pursuant
to an insurance policy) (from an
insurance company)(from the Unsatisfied Claim and Insurance Judgment Fund);
(3) that the omitted fact was material.
The
first element that the State must prove beyond a reasonable doubt is that the defendant
knowingly omitted a statement of fact or caused to be omitted a statement of
fact from a record, bill, claim or other document. The statement may have been made in writing,
electronically, orally or in any other form.
A
person acts knowingly with respect to the nature of his/her
conduct or the attendant circumstances if he/she is aware that his/her
conduct is of that nature, or that such circumstances exist, or he/she is aware of a high probability of their
existence. A person acts knowingly with
respect to a result of his/her
conduct if he/she is aware that it is practically certain
that his/her
conduct will cause such a result.
"Knowing," "with knowledge," or equivalent terms
have the same meaning. Knowingly is a state of mind and cannot be seen and can
only be determined by inference from conduct, words or acts. Therefore, it is not necessary that witnesses
be produced by the State to testify that a defendant said that he/she knowingly did something. His/Her
knowledge may be gathered from his/her acts
and his/her
conduct and from all he/she said and did at the particular time and
place and from all the surrounding circumstances reflected in the testimony
[and evidence adduced at trial].
The second element the State must
prove beyond a reasonable doubt is that the defendant (submitted) (caused to be
submitted) (attempted[2] to
submit)(attempted to cause to be submitted) the statement (as part of) (in
connection with)(in support of)(in opposition to) a claim for payment, reimbursement
or other benefit (pursuant to an insurance policy)(from an insurance
company)(from the Unsatisfied Claim and Judgment Fund Law).
"Insurance policy" means the
instrument, in writing, electronically or in any other form, in which are set
forth the terms of any certificate of insurance, binder of coverage, contract
of insurance or contract of re-insurance, issued by an insurance company,
including, but not limited to, a State-assigned risk plan, plan of indemnity
protection provided by or on behalf of a joint insurance fund or benefit plan,
motor club service plan, or guaranty bond, surety bond, cash bond or any other
alternative to insurance authorized or permitted by the State of New Jersey.[3]
Insurance company means any person, company,
corporation, unincorporated association, partnership, professional corporation,
agency of government and any other entity authorized or permitted to do
business in New Jersey, subject to regulation by the State, or incorporated or
organized under the laws of any other state of the United States or of any
foreign nation or of any province or territory thereof, to indemnify another
against loss, damage, risk or liability arising from a
contingent or unknown event.
Insurance company includes, but is not limited to, an insurance company
as that term is defined in section 3 of P.L.1983, c. 320
(C.17:33A-3), self-insurer, re-insurer, reciprocal exchange, inter-insurer,
hospital, medical or health service corporation, health maintenance
organization, surety, assigned risk plan, joint insurance fund, and any other
entity legally engaged in the business of insurance as authorized or permitted
by the State of New Jersey, including but not limited to any such entity
incorporated or organized under the laws of any other state of the United
States or of any foreign nation or of any province or territory thereof.[4]
[CHARGE APPROPRIATE SECTION IF APPLICABLE:
Insurance company includes, but is not limited to, an
insurance company which can be in the form of any corporation, association,
partnership, reciprocal exchange, interinsurer, Lloyd's insurer, fraternal
benefit society or other person engaged in the business of insurance pursuant
to Subtitle 3 of Title 17 of the Revised Statutes (C.17:17-1 et seq.),
or Subtitle 3 of Title 17B of the New Jersey Statutes (C.17B:17-1
et seq.); or any medical
service corporation operating pursuant to P.L.1940, c. 74 (C.17:48A-1 et seq.); or any hospital service corporation operating pursuant to P.L.1938,
c. 366 (C.17:48-1 et seq.); or any health service
corporation operating pursuant to P.L.1985, c. 236 (C.17:48E-1 et seq.); or any dental service corporation operating pursuant to P.L.1968,
c. 305 (C.17:48C-1 et seq.); or any dental plan organization operating pursuant to P.L.1979,
c. 478 (C.17:48D-1 et seq.); or any insurance plan
operating pursuant to P.L.1970, c. 215 (C.17:29D-1); or the New Jersey Insurance Underwriting Association
operating pursuant to P.L.1968, c. 129 (C.17:37A-1 et seq.); or the New Jersey Automobile Full Insurance Underwriting
Association operating pursuant to P.L.1983, c. 65 (C.17:30E-1 et seq.) and the Market Transition
Facility operating pursuant to section 88 of P.L.1990, c. 8 (C.17:33B-11); or any risk retention group or purchasing group operating
pursuant to the "Liability Risk Retention Act of 1986," 15 U.S.C. § 3901 et seq., [5] or a self-insurer, re-insurer, reciprocal exchange,
inter-insurer, hospital, medical or health service corporation, health
maintenance organization, surety, assigned risk plan, joint insurance fund, and
any other entity legally engaged in the business of insurance as authorized or
permitted by the State of New Jersey, including but not limited to any such
entity incorporated or organized under the laws of any other state of the
United States or of any foreign nation or of any province or territory thereof.[6]]
[RESUME MAIN CHARGE]
The
third element the State must prove beyond a reasonable doubt is that the
statement of fact omitted was material.
An omitted fact is material if, at the time when the statement should
have been made, a reasonable insurer would have considered the omitted fact
relevant to its concerns and important in determining its course of action.[7] In other words, the statement of fact is material
if it could have reasonably affected the decision by an insurance company to
provide insurance coverage to a claimant or the decision to provide any benefit
pursuant to an insurance policy or the decision to provide reimbursement or the
decision to pay a claim. (THE COURT
SHOULD TAILOR THIS PORTION OF THE CHARGE TO THE FACTS IF MATERIALITY IS
DISPUTED) [8]
[CHARGE IF APPLICABLE]
If you find that ________ signed or
initialed an application, bill, claim, affidavit, certification, record or
other document, then you may infer that he/she read and reviewed the application, bill,
claim, affidavit, certification, record or other document.
An inference is a deduction of fact
that may be drawn logically and reasonably from another fact or group of facts
established by the evidence. Whether or
not an inference should be drawn is for you to decide using your own common
sense, knowledge and everyday experience.
Ask yourselves is it probable, logical and reasonable. However, you are never required or compelled
to draw an inference. You alone decide
whether the facts and circumstances shown by the evidence support an inference
and you are always free to draw or not to draw an inference. If you draw an inference, you should weigh it
in connection with all the other evidence in the case keeping in mind that the
burden of proof is upon the State to prove all the elements of the crime beyond
a reasonable doubt.
[CHARGE
IF APPLICABLE]
(Multiple fraudulent statements alleged in
a single narrative or document)
The State alleges that the defendant
omitted multiple statements of facts that are alleged to be material. Multiple fraudulent statements may be
considered by you to constitute multiple acts of insurance fraud only if the
alleged fraudulent statement relates to a conceptually distinct claim. (Here,
the State alleges the claims are distinct:
Instruct the jury as to the nature of the State’s claim. Charge
the defendant’s version, if requested.)
If the
multiple statements made in a single narrative or document relate to a claim
that is conceptually similar, it may then constitute only a single act of
insurance fraud.[10] Thus, you must unanimously find that the
State has met its burden to prove the four elements that I have defined for you
as to a particular statement contained in any single narrative or document. [11] In
other words, all twelve of you must agree that a particular statement contained
in the narrative or document satisfies all four elements beyond a reasonable
doubt in order to find the defendant guilty.
[RESUME MAIN CHARGE]
If the State has failed to prove any
of these elements beyond a reasonable doubt, then you must find defendant not
guilty of the crime of insurance fraud.
If you find that the State has proven beyond a reasonable doubt each of
the four elements, then you must find defendant guilty of the crime of insurance
fraud. If you find the defendant guilty
of the crime of insurance fraud, you must then go on to consider the following.
[CHARGE IF SECOND DEGREE INSURANCE FRAUD IS
ALLEGED]
If you find that the State has
proven the defendant guilty of insurance fraud, you must then consider if the
defendant knowingly committed five or more acts of insurance fraud that had an
aggregate value of at least one thousand dollars.
A
section of our statute provides that insurance fraud is a crime of the third
degree, except that it is a crime of the second degree if the defendant
knowingly committed five or more acts of insurance fraud that had an aggregate
value of at least one thousand dollars.[12]
I have
already defined the mental state of knowingly for you.
An omitted material fact contained
in a separate document or narrative relating to a single claim may each constitute
a separate act of insurance fraud.[13] However, multiple statements in the same
narrative or document relating to a conceptually similar claim may only
constitute a single act of insurance fraud. Thus, to find five or more acts, you must find
that the State has proven beyond a reasonable doubt, that the defendant
knowingly made false, fictitious, fraudulent or misleading statements or
omitted a material fact or caused to have omitted a material fact in five or
more discrete documents or narratives.
Statements relating to the same claim that are contained in separate
narratives or documents may constitute more than a single act, if the State has
proven beyond a reasonable doubt that defendant submitted (caused to be
submitted) (attempted[14] to
submit)(attempted to cause to be submitted) the particular statement (as part
of) (in connection with)(in support of)(in opposition to) a claim for payment,
reimbursement or other benefit (pursuant to an insurance policy)(from an
insurance company)(from the Unsatisfied Claim and Judgment Fund), and that each
statement or omitted fact was material.
[CHARGE IF APPROPRIATE]
For
example, if a document omitted the true cause of the loss and omitted the
identity of the person who caused the loss, that would still constitute only a
single act of insurance fraud. If, however, the omitted fact of the true cause
was made in one document, and the identity of the person who caused the loss
was omitted in another document, even if the statements were made in connection
with the same claim, that would constitute separate acts of insurance fraud.[15]
[RESUME MAIN CHARGE]
The
State must also prove beyond a reasonable doubt that the total value of the
property, services or other benefit wrongfully obtained or sought to be
obtained was one thousand dollars ($1,000) or more.
In
summary, if you find that the State has failed to prove any of the elements of
the crime of Insurance Fraud, you must find the defendant not guilty. If you find
the State has proven beyond a reasonable doubt all of the elements of insurance
fraud, and the State has proven beyond a reasonable doubt that the defendant
committed five or more acts of insurance fraud, and that the total value of the
acts was one thousand dollars ($1,000) or more, then you must find the
defendant guilty of Insurance Fraud in the Second Degree. If you find the State
has failed to prove either that the defendant committed five or more acts of
insurance fraud, or that the total value was one thousand dollars or more,
beyond a reasonable doubt, but find that the State has proven all of the other
elements of Insurance Fraud beyond a reasonable doubt, then you must find the
defendant not guilty of Insurance Fraud in the Second Degree, and you must find
the defendant guilty of Insurance Fraud in the Third Degree.
[1] The
Unsatisfied Claim and Judgment Fund Law (UCJF),
P.L.1952, c.174 (N.J.S.A. 39:6-61 to 39:3-91)
provided for the establishment and administration of a fund for the payment of
damages to certain qualified persons for personal injury or property damage
involving uninsured or unknown owners of automobiles. Jimenez v. Baglieri,
152 N.J. 337, 339 (1998). There
is caselaw, in the civil context, that prohibits references to the Unsatisfied
Claim and Judgment Fund during a civil trial. Dalton v. Gesser, 72 N.J.Super.
100, 106 (App. Div. 1962). The gist of the prohibition relates to the undue
prejudicial impact the fact that payment of damages would be coming from a
public fund might have on the deliberating jury. That same risk does not appear
to be present in the context of a criminal case, but the Court might consider
crafting an appropriate limiting instruction, if deemed appropriate in the
context of the case.
[2] If attempt is charged, the jury should be instructed from
the Model Jury Charge, Attempt N.J.S.A.
2C:5-1, as attempt requires a purposeful mental state.
[3] N.J.S.A. 2C:21-4.5.
[4] Id.
[6] N.J.S.A. 2C:21-4.5.
[7] Longobardi v. Chubb Ins.
Co. of New Jersey,
121 N.J. 530, 540-541 (1990). In Longobardi, the N.J. Supreme
Court examined materiality of fraudulent representations in the context of
denial of coverage actions, and the Court adopted an objective standard for
materiality. It is unclear from the
penal statute whether the materiality of a statement must be judged by an
objective or subjective standard. If the standard would be subjective, then the
jury should be instructed that the State must provide evidence of actual detrimental
reliance by the alleged victim or victim(s) to prove this element beyond a
reasonable doubt.
[8] See Model Jury Charges, Criminal, Perjury, N.J.S.A.
2C:28-1b. This paragraph should be
tailored to the appropriate facts of the case if the issue regarding
materiality is disputed or falls outside the examples cited. The New Jersey Supreme Court has consistently
held that the subjective good faith of the applicant regarding an “innocent”
mistake was not relevant to the materiality determination. Palisades Safety
and Ins. Ass’n v. Bastien, 175 N.J. 144, 151 (1995).
[10] State v. Fleischman, 189 N.J. 539, 554 (2007).
As an example where multiple false statements in a single narrative would
constitute separate acts, Fleischman points to the situation where a
false statement is made that an automobile was stolen, and that a false claim
was made that a fur coat was in the automobile at the time of the theft. This
would constitute separate acts of insurance fraud, even if contained in a single
narrative. Id. at 546-547 n.3.
[11] The Committee’s view is that this specific unanimity charge
is required as to a particular statement pursuant to State v. Frisby,
174 N.J. 583 (2002) and State v. Gentry, 183 N.J. 30
(2005) and the cases cited therein as a matter of state constitutional law.
Although a specific unanimity charge is not required in every circumstance
where the jury must find some preliminary factual circumstances which might be
evidence of a single course of conduct, see
e.g. State v. Parker, 124 N.J. 628, 633 (1994) and examples
cited therein, the discrete inquiry the jury must undertake regarding the
materiality of a statement seems to make this scenario more like those examples
cited in Frisby and Gentry which require a specific unanimity
instruction as opposed to Parker and examples cited therein. A special verdict form may be needed to be
used if the circumstances warrant.
[12] N.J.S.A. 2C:21-4.6(b). The statute states that claims
of health care claims fraud can be aggregated under this section. If there are
allegations of health care claims fraud, N.J.S.A. 2C:21.4.2, the Model
Jury Charge on Health Care Claims Fraud should be used as appropriate for those
alleged acts.
[13] State v. Fleischman, 189 N.J. at 554.
[14] If attempt is charged, the jury should be instructed from the
Model Jury Charge, Attempt N.J.S.A.
2C:5-1, as attempt requires a purposeful mental state.
[15] The trial court should not charge similar examples which
mirror the acts alleged in
the indictment.
The examples above should be changed if that occurs.
