For these reasons, the CFA violations alleged in the first count, on which plaintiff seeks damages that would be the equivalent of applying a rate different from the filed rate, were properly dismissed.
The third category of allegations contained in the first count � that defendant-insurers breached the terms of the policies she purchased � are not impacted by the filed-rate doctrine. For example, plaintiff alleges that defendants misconstrued “the Monthly Benefits provision to minimize the benefits paid,” failed “to make timely payments,” miscalculated premiums, and ignored cancellation notices. There is nothing about the filed-rate doctrine that would preclude a consumer from suing for damages on a claim that the insurer breached the policy as written. Although the doctrine precludes a claim for damages that would indirectly cause the application of rates different from the filed rates, and would also preclude plaintiff from seeking relief, whether equitable or legal, for having been misled by unconscionable sales practices that caused plaintiff to enter into a contract consistent with the filed rate, the filed-rate doctrine does not preclude a consumer from suing for damages by having been deprived of benefits that were promised, and were consistent with the filed rate, but were not delivered.
Notwithstanding the inapplicability of the filed-rate doctrine in these circumstances, the breach of an enforceable contract does not constitute a violation of the CFA. See Kuhnel v. CNA Ins. Companies, 322 N.J. Super. 568, 582 (App. Div. 1999), certif. denied, 163 N.J. 12, cert. denied 121 S.Ct. 61 (2000). Accordingly, while plaintiff may maintain her claim against defendant-insurers based on their alleged breach of the terms of the policies, these allegations were properly dismissed insofar as they are claimed to constitute violations of the CFA.
The fourth category relates to plaintiff’s claim that the policies’ benefits and terms were inconsistent with the governing DOBI regulations. These claims are not subject to dismissal pursuant to the filed-rate doctrine. Rather than conflict with the doctrine, these alternative claims actually assume the application of the filed rate and filed policy terms, and seek enforcement due to defendant-insurers’ alleged failure to abide by DOBI regulations.
The other counts of the complaint asserted against defendant-insurers, which allege common-law fraud, fraudulent concealment, grounds for the imposition of a constructive trust, and breach of the covenant of good faith and fair dealing, are precluded by the filed-rate doctrine in the same way since they essentially rephrase the consumer-fraud allegations that have been determined to be barred by the filed-rate doctrine. There are, however, apart from these generalities, two specific claims contained in these counts of the complaint that should not have been dismissed.
First, the complaint alleges that plaintiff was sold a family leave insurance policy in March 1999 to which she did not consent. Unlike the fraudulent-inducement claims discussed earlier and found barred by the filed-rate doctrine, this fraud claim has no conceivable bearing on DOBI’s ratemaking authority and is not impacted by the nonjusticiability strand because plaintiff’s presumed knowledge of the filed rates is irrelevant to her claim that she was sold this policy without her knowledge or consent. Second, plaintiff’s claims against American with regard to the credit interruption policies it issued cannot be barred by the filed-rate doctrine since the defendant insurers did not demonstrate, in moving for dismissal, the existence of a filed rate for these policies. It would be illogical to apply the filed-rate doctrine to a contract that is not based on a filed rate. In that circumstance, it cannot be presumed that the consumer had knowledge of the rate, and the award of damages could not conflict with the rate, because no rate had been filed.
D. Plaintiff’s claims against CitiBank must be viewed differently since CitiBank is not an insurer and filed no rate regarding these policies.
Smith considered the impact of the filed-rate doctrine on unregulated retailers or sellers, drawing a distinction between those retailers or sellers who are agents of the regulated entity and those who act independently. The Court expressed concerns about lifting the impact of the filed-rate doctrine when the goods or services are sold by a nonregulated entity that is in an agency relationship with a regulated entity. On the other hand, Smith held that these concerns evaporate when a nonregulated retailer or seller acts independently from the regulated entity.
The record provides little information by which the relationship between defendant-insurers and CitiBank may be assessed or defined. Depending on the circumstances outlined in Smith, holding CitiBank liable for damages arising from its separate contractual relationship with plaintiff does not necessarily implicate the filed-rate doctrine.
III. With the exception of the referral to DOBI of plaintiff’s claims against American regarding the credit insurance policies for which no rate was filed, the trial judge’s application of the doctrine of primary jurisdiction is rejected.
A. The filed-rate doctrine disposes of claims to which it applies, while the doctrine of primary jurisdiction directs that an actionable claim ought to be pursued elsewhere. Because administrative agencies are unlikely to possess the authority to issue relief coextensive with the authority provided by the CFA to courts of competent jurisdiction, the primary-jurisdiction doctrine in such instances does not warrant dismissal but only a stay of the proceedings pending the agency’s determination. Accordingly, the trial judge’s determination that the doctrine of primary jurisdiction required dismissal of any aspect of the complaint is rejected.
In determining whether the primary-jurisdiction doctrine should apply, four factors must be weighed:
1) whether the matter at issue is within the conventional experience of judges; 2) whether the matter is peculiarly within the agency’s discretion, or requires agency expertise; 3) whether inconsistent rulings might pose the danger of disrupting the statutory scheme; and 4) whether prior application has been made to the agency. Boldt v. Correspondence Mgmt., Inc., 320 N.J. Super. 74, 89 (App. Div. 1999).
Defendant-insurers argue that primary jurisdiction requires that any remaining claims against them should be heard by DOBI, and CitiBank argues that any remaining claims against it should be heard by the Office of the Comptroller of the Currency (OCC).
B. The claims that remain against defendant-insurers, after application of the filed-rate doctrine, consist of (1) the alleged failure of the insurers to comply with the terms of the insurance contracts, (2) the alleged failure of the insurers to comply with insurance regulations, (3) American’s alleged fraudulent conduct, including violations of the CFA, with regard to the credit interruption policies as to which there is no filed rate, and (4) the enrollment of plaintiff in a family leave policy allegedly without her consent. In applying the principles of primary jurisdiction, plaintiff’s claims against American regarding the credit interruption policies should be referred to DOBI.
Although the claims asserted against American regarding its credit insurance policies are within the “conventional experience of judges,” the actions of insurers in marketing their policies, the fairness of the content of their policies, and the rates charged, are matters falling well within the realm of DOBI’s experience and expertise. There is also a potential for inconsistent rulings that may tend to disrupt the regulatory scheme in which DOBI is engaged (even though these policies have not been subjected to that scheme due to the lack of a filed rate).
However, the claims that survived the application of the filed-rate doctrine, i.e., the breach-of-contract claims, the failure to comply with DOBI’s regulations, and the alleged fraudulent enrollment of plaintiff in a family leave policy, should not be referred to DOBI. Courts routinely determine whether insurance policies have been breached and there is no regulatory scheme that would be impacted by a judicial determination of a breach of an insurance contract that otherwise conforms to insurance regulations. The same can be said for plaintiff’s claim regarding the family leave policy. In addition, adjudication of the claims that seek enforcement of state insurance regulations would not interfere with DOBI’s expertise or regulatory schemes. In determining whether the policies in question conform to state regulation, the court would be obligated to apply those standards and, thus, would be acting consistently with the regulatory authority of DOBI.
C. In applying the primary-jurisdiction principles discussed above, the trial judge erred in finding a need to refer the claims against CitiBank to OCC.
The parties do not dispute that CitiBank is a national bank regulated by OCC. 12 U.S.C.A. �� 1, 21-27, 481. It is also true that OCC permits national banks to provide credit insurance to their loan customers, subject to certain restrictions. See 12 C.F.R. �� 12.1 to 12.5. CitiBank’s marketing activities in the credit insurance field are governed by the Truth in Lending Act (TILA), 15 U.S.C.A. �� 1601 to 1681. TILA has determined that premiums for credit insurance are considered “finance charges,” except under specified circumstances. See 15 U.S.C.A. � 1605(a); 12 C.F.R. �226.4(b) and (d).
Although the Board of Governors of the Federal Reserve System is responsible for promulgating regulations under TILA, 15 U.S.C.A. � 1604(a), which it has fulfilled by adopting Regulation Z, 12 C.F.R. �� 226.1 to 226.28, the OCC is responsible for enforcing compliance with TILA with respect to national banks such as CitiBank. 15 U.S.C.A. � 1607(a)(1)(A).
The weighing of the four factors described in Boldt leads to a determination that deference should not be given to OCC under the doctrine of primary jurisdiction. First, it is well within the conventional experience of judges to address consumer-fraud issues. By creating a private right of action, TILA anticipated judicial involvement in its interpretation and the interpretation of its implementing regulations, and assumes the judiciary’s competence to do so. 15 U.S.C.A. � 1640. Second, interpretation and enforcement of TILA is not peculiarly within OCC’s discretion and does not require its expertise.
Considering that OCC is not the sole agency responsible for enforcing TILA � eight other federal agencies also possess that responsibility, 15 U.S.C.A. � 1607(a) � also strongly suggests there is no need to defer to OCC in this matter. This diversity of responsibility for enforcement of TILA also compels a determination that the third primary-jurisdiction factor, the risk of inconsistent rulings that would jeopardize a uniform statutory or regulatory scheme, has not been met here. The fourth factor also weighs against deferring to OCC, since the record on appeal does not indicate the existence of a pending OCC claim; indeed, CitiBank has not referred to any statute or regulation that would support its argument that OCC has a mechanism for hearing claims of TILA violations.
� Digested by Steven P. Bann
[The slip opinion is 39 pages long.]
For appellant � Arnold C. Lakind (Szaferman, Lakind, Blumstein, Blader, Lehmann & Goldshore). For respondents: Standard Guaranty Insurance Company, Union Security Life Insurance Company and American Security Insurance Company � Frank Burt (Jorden Burt) of the Florida bar, admitted pro hac vice (Reed Smith; Mark S. Melodi, of counsel; Burt and Farrokh Jhabvala on the brief); Citibank (South Dakota) N.A. � Mark F. Horning (Steptoe & Johnson) of the D.C. bar, admitted pro hac vice (Gibbons, Del Deo, Dolan, Griffinger & Vecchione; Horning, Kathleen M. Graber, Brian J. McMahon and Anthony M. Gruppuso on the brief).
