A New Jersey Supreme Court decision that a surgeon’s malpractice policy was invalid because he had lied on his application leaves an injured patient fuming and with little recourse against the surgeon who says he is broke.
It also leaves insurance companies breathing a little easier.
Surgery performed by Dr. Sean Robert Stoddard on Thomas DeMarco in 2010, lead to a deformed foot, claimed DeMarco in his suit. The insurance company, the Medical Malpractice Joint Underwriting Association, said it should not be liable because Stoddard had lied on his application for coverage, and a divided court agreed.
The court said that to force the insurance company to cover the incident would send the message that fraudulent conduct is acceptable. A dissenting opinion by one of the judges voting to enforce coverage said that the insurance company should be liable because it did not conduct adequate due diligence prior to issuing the policy in the first place.
Stoddard’s misrepresentation had to do with what percentage of his practice was in Rhode Island as opposed to what percentage was in New Jersey. The insurance company only insures doctors who practice at least 51% of the time in Rhode Island.
