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Juan and Nora Valdez filed a lawsuit in federal court against defendants Macy’s and Thyssenkrupp Elevator America, Inc. due to the personal injuries suffered by their 10 year daughter whose right foot and leg got trapped in an escalator while visiting a Macy’s store. J.V. by her GAL Juan Valdez v. Macy’s, Inc., 2014 U.S. Dist. LEXIS 138952 (D.N.J. September 30, 2014). The minor underwent 13 surgeries to save her foot and leg, but she did have her pinky and second toes amputated.  They sued in their own names, as well as on behalf of their daughter, claiming negligence against the defendants. Their lawsuit also included a claim for parental loss of consortium. Both defendants filed a motion to dismiss the loss of consortium claim.

The parents claimed the loss of consortium and services premised on the assertion that as parents, they were entitled to the services and consortium that parents would typically expect from a child living in the same household and that they have lost that based upon the defendants’ conduct. In deciding this motion, the court looked to New Jersey law.

The District Court found that a parental loss of services of a minor child resulting from a negligence claim was a viable claim under New Jersey law. However, the Court noted that New Jersey law does not provide for the right of recovery by parents to sue for the loss of consortium of a minor child.

Parents can sue for damages for loss of the child’s past or future services. The rationale for such a claim is rooted in the common law when children would work on the family farm or at a factory as early as age 10. While other states have moved beyond the pecuniary loss calculation of  a parent’s loss, New Jersey remains “off-trend” in prohibiting a loss of consortium claim. Thus, the District Court granted the defendants’ motion in dismissing this claim.

Plaintiff Carylee Johnson slipped and fell on the public sidewalk in front of the home owned by defendants Eric and Leigh Ann Morse. She suffered injuries to her knee, arm, and shoulder and sued the defendant homeowners on the basis that the predecessor owner negligently built a defective sidewalk. In Johnson v. Morse, 2014 N.J. Super. Unpub. LEXIS 1788 (App. Div. July 21, 2014), the Appellate Divisions was asked to decide whether the plaintiff’s expert report was sufficient to establish that the defendants were responsible for the sunken sidewalk slab in front of their home.

The alleged dangerous condition was a 1 ½ inch sinking of a sidewalk slab and a resulting protruding edge of the adjacent slab. The plaintiffs’ expert claimed that the sunken slab was caused by a failure to compact the base material of the sidewalk properly when it was built back in 1991.

Under New Jersey law, a residential property owner can be liable for an injury caused by the condition of an adjoining public sidewalk, if the plaintiff can prove that the residential property owner, or a specifically designated prior owner of the property, actively caused the dangerous condition, such as by negligent construction or repair of the sidewalk.

Here, for the plaintiffs to be able to pursue their claim they would need to show that the defendants’ predecessor in title negligently constructed the sidewalk panel in question, when the construction took place, and what the standards were at the time the work was done.

The plaintiffs’ expert opined in his report that the unsafe sinking of the sidewalk slab was due to the base material not being properly compacted at the time of construction. However, the expert failed to test the base material or conduct any other investigation by which he attributed the sinking to defective construction.

While the expert in his report attached excerpts of construction industry documents pertaining to sidewalk safety, his report did not indicate the source or date of the document or how he used it in his evaluation that this particular sidewalk had been negligently constructed. He was permitted to supplement his report but, again, failed to identify the date of the industry standard document upon which he relied.

The Appellate Division found this report inadequate to establish a basis against the homeowners because the expert never tied his conclusion that the sidewalk was defectively constructed to the construction industry documents upon which he relied. Thus, his mere conclusion without factual support or sufficient identification of the applicable industry standard was found to be an inadmissible net opinion.

Accordingly, the appeals court found his report failed to establish a case against the defendants that they or their predecessor in title affirmatively created the defective condition of the sidewalk. Due to the plaintiff’s inability to present an adequate expert report establishing the defendants’ potential liability for the sunken sidewalk in front of the home, the Appellate Division upheld the trial court’s dismissal of the lawsuit.

In Masaitis v. Allstate, 2014 N.J. Super. Unpub. LEXIS 2100 (App. Div. Aug. 26, 2014), the plaintiffs Marilyn and William Masaitis appealed from a jury verdict that they were not entitled to compensation from their homeowner’s insurance carrier, Allstate New Jersey Insurance co., for loss of property due to a fire. Allstate disclaimed coverage on grounds of fraud and concealment but never returned the plaintiff’s insurance premiums. The plaintiffs claimed that Allstate should have been estopped from denying the claim because it never refunded their premiums.

The plaintiffs’ home was damaged by a fire. The municipal fire marshall was unable to determine the cause of the fire, nor did the county prosecutor’s office attribute the cause of the fire to arson. Nevertheless, based upon circumstantial evidence, at the trial, Allstate argued that the plaintiffs had committed arson.

Allstate also contended that the plaintiffs made false claims to Allstate for the loss of personal property. Allstate was able to prove that items of loss were fraudulent. As an example, plaintiffs claimed the loss of 2 Rolex watches valued at a total of $70,000 but they were not able to prove they ever owned such watches.

The plaintiffs argued that Allstate should have been estopped from denying their claim because it did not refund their insurance premiums although it claimed that the policy was void because of their alleged fraud. However, the Appellate Division held that the law that the insurer could elect to either rescind the insurance policy and return the premium or to affirm the policy and abide by its terms, only applied to circumstances where the insurance policy was obtained by fraud at its inception.

Here Allstate did not claim fraud at its inception. Rather, it claimed that the plaintiffs made a fraudulent claim on their policy. Thus, such a defense did not require Allstate to rescind the policy. Hence, the Appellate Division found that Allstate was not estopped from pursuing its defenses and counterclaim.

Veronica Maciag, a minor, was attacked by a pit bull owned by the decedent defendant, Kenneth Kantor. There had been prior incidents involving this dog, in which the dog had escaped and bitten people. The minor filed suit against Kantor to recover for her injuries. After the lawsuit was filed, Kantor passed away and his estate was substituted in as a defendant. In Maciag v. Kantor, docket no. BER-5878-11 (June 25, 2014 Law Div.), the trial court judge was asked to rule on a motion filed by the defendant Estate to dismiss the punitive damages claim asserted against the defendant.

The defendant argued that the purpose of punitive damages is to punish and deter the wrongdoer only. Given that the defendant is now deceased, the defendant Estate contended that the punitive damages claim must be dismissed, because the defendant can no longer be punished or deterred from his alleged egregious acts.

Plaintiff opposed the motion, arguing that the defendant was clearly aware of the dog’s propensity to escape and bite others. Also, the case had previously been listed for trial and plaintiff argued that, had the case been tried previously, the defendant would have still been alive. Further, the plaintiff contended that an estate assumes the liabilities of its decedent in numerous scenarios. Thus, plaintiff’s position was that, just because the defendant was now deceased, that should not change the defendant’s liability for punitive damages.

The trial judge was faced with deciding whether a claim for punitive damages survives the death of the defendant. The court pointed out that the New Jersey Punitive Damages Act allows punitive damages to be awarded for the purpose of punishing and thereby deterring only the wrongdoer.

While this was a novel claim in New Jersey, 32 other jurisdictions confronting this same issue have held that punitive damages may not be awarded against a decedent’ estate. Hence, consistent with the purposes of the Act, the trial court found that punitive damages may not be pursued against a deceased defendant and granted the Estates’ motion to dismiss the punitive damages claim.

Plaintiff James Epstein sued the defendant Sondra Lippi for injuries arising out of collision between him, as he was riding his bicycle, and the automobile she was operating. In Epstein v. Lippi, 2014 N.J. Super. LEXIS 1703 (July 14, 2014 App. Div.), Epstein, who was pro se, appealed an order awarding Lippi $1000 in counsel fees and costs as a sanction for pursuing frivolous litigation. In this case, the Appellate Division was faced with deciding whether sanctions could be imposed where a party has pursued some claims which are frivolous.

Epstein was subject to the verbal threshold and, thus, to recover for his non-economic injuries, he had to sustain a permanent injury as defined by the Automobile Insurance Cost Recovery Act. In his answers to interrogatories, the plaintiff certified that his claims were not permanent. Thereafter, defendant’s counsel sent the plaintiff a frivolous lawsuit letter, demanding that he dismiss his complaint because he admitted that he did not have a permanent injury, his insurer compensated him for the loss of his bicycle, and he was not seeking recovery for lost wages or other economic claims.

The plaintiff refused to dismiss his complaint, stating that he sought to recover his out of pocket expenses incurred in seeking medical treatment and he sought full restitution for his bicycle, claiming that his insurance company only partially reimbursed him. Further, he sought punitive damages because the defendant’s conduct “displayed a conscious and deliberate disregard for the safety of others.”

The defendant moved for summary judgment on the basis that the plaintiff did not meet the verbal threshold. The trial court judge granted the motion and also dismissed the property damage claim as to his bicycle on the basis that it too was barred by the plaintiff’s failure to meet the verbal threshold.

Subsequently, the defendant moved for sanctions. The trial court awarded the defendant $1000 in counsel fees as a result of plaintiff’s continued pursuit of his claims. Defendant had sought over $5000 but the court determined that a reasonable fee to act as a deterrence in the future was $1000.

On appeal, the plaintiff contended that the trial court wrongfully dismissed his property damage claim. Further, he argued that the court should not have granted an award of fees because his property damage claim was not frivolous.

The Appellate Division reluctantly reinstated the plaintiff’s property damage claim. The court agreed with the plaintiff that this economic claim was not barred due to the plaintiff’s failure to meet the verbal threshold.

However, the Appellate Division found that the survival of one claim “does not negate the imposition of sanctions where a party has otherwise pursued other claims which are frivolous.”  The appeals court agreed with the trial court that the plaintiff presented absolutely no evidence to support a punitive damages claim and, thus, he should have dismissed that claim. As a result, the Appellate Division upheld the $1000 attorneys fee sanction assessed against the plaintiff.

Plaintiff Cecilia Taransky appealed to the Third Circuit Court of Appeals, claiming that she was not required to reimburse Medicare for conditional medical expenses advanced on her behalf as a result of a trip and fall accident. In Taransky v. Sec’y of the United States HHS, 2014 U.S. App. LEXIS 14408 (3rd Cir. 2014), the Third Circuit rejected that argument.

Taransky fell at the Larchmont Shopping Center in Mt. Laurel, NJ and sued the owners and operators of the shopping center (“Larchmont”) for the bodily injury she suffered. Taransky was a Medicare recipient and Medicare paid her medical bills. She settled her suit for $90,000 and Medicare demanded reimbursement for its payments.

After Taransky settled her lawsuit, she signed a release of “all past, present and future claims,” including medical treatment and for medical expense benefits in connection with the accident. The release also provided that any liens or subrogation claims would be satisfied and discharged from the settlement proceeds and specifically included Medicare liens and claims.

After the settlement, Taransky filed a motion in the New Jersey Superior Court, requesting an order apportioning the proceeds of the settlement between various elements of damages relevant to the anticipated administrative proceedings with the federal Centers for Medicare and Medicaid Services. She acknowledged her lawsuit sought damages for certain medical expenses for medical treatment, some of which were paid for through Medicare. However, she claimed that the New Jersey Collateral Source Statute N.J.S.A. 2A:15-97 (“Collateral Source statute”), precluded tort plaintiffs like herself from recovering losses such as medical expenses that were already paid by another source. Based upon that premise, she claimed that her Medicare expenses were not considered in the settlement negotiations and were not included in the settlement amount.

The Superior Court granted Taransky’s motion and entered an order that the settlement did not include any Medicare expenses. The order specified that the settlement amount was allocated solely to the plaintiff’s bodily injury and pain and suffering claim.

Thereafter, the Medicare contractor demanded reimbursement of the $10,121 that the Medicare program paid on her behalf. Taransky refused to pay, citing to the Collateral Source statute and the allocation order she received from the Superior Court.

Taransky then proceeded through the Medicare appeals process up to a hearing before an Administrative Law Judge, all of whom rejected her claims. Next, Taransky filed suit in the United States District of New Jersey, reiterating her claim that she was not responsible to reimburse Medicare from the proceeds of her settlement. The Government was granted summary judgment, dismissing her claim, and this appeal followed.

Taransky argued that the Government failed to demonstrate that Larchmont had a responsibility to make payment for her Medicare expenses and, thus, the obligation to reimburse was not triggered. However, the Third Circuit held that if the settlement releases the tortfeasor from claims for medical expenses, that is sufficient to demonstrate the beneficiary’s obligation to reimburse Medicare. Here, Taransky’s release specifically anticipated Medicare’s lien and provided that it would be satisfied and discharged out of the settlement proceeds. Thus, the court found that Taransky was reimbursed for her medical costs and she cannot hide behind the lump sum settlement to deprive the Government of the reimbursement it is owed.

Next, she argued that her settlement amount could not have included her medical costs as a matter of law because Medicare payments are a “collateral source” of benefits that may not be obtained form a tortfeasor under the Collateral Source statute. Although the New Jersey Supreme Court has not ruled on this issue, the Third Circuit predicted that the Court would hold that the Medicare payments, because of their conditional nature, do not constitute a collateral source under the Collateral Source statute. Thus, Taransky could not rely on that statute to avoid reimbursement to the Government.

Taransky also argued that the Government must defer to the Superior Court’s apportionment order, which provided that no portion of the settlement recovery is attributable to medical expenses. The Third Circuit rejected this argument as well, finding that it was not an adjudication on the merits and Taransky never made the Medicare contractor or the Government a party to her suit.

Thus, after rejecting the plaintiff’s numerous arguments, the Third Circuit found that the plaintiff must reimburse Medicare for the conditional payments it made for her medical expenses incurred in her trip and fall accident.

Plaintiff Philip Biazzo (“Biazzo”) had the misfortune to be rear ended twice in a single afternoon. He sued the drivers of both vehicles. As a result of both accidents, he claimed injury to his neck, back, and shoulders. He had suffered prior back and shoulder injuries but Biazzo claimed he had been asymptomatic for years. Plaintiff’s expert opined that Biazzo suffered a permanent injury to the neck, back, and shoulder. Plaintiff did not apportion the respective damage between the two collisions, nor did he apportion damage between the prior and new injuries. In Biazzo v. Parker, 2014 N.J. Super. Unpub. LEXIS 1721 (July 15, 2014 App. Div.), the plaintiff appealed the dismissal of his case after the drivers won on summary judgment due to his failure to apportion his damages.

Plaintiff had been on his way to a routine doctor’s visit when the first collision occurred at 1:25 pm. Plaintiff refused medical treatment and continued on to his doctor’s office. After leaving the doctor’s office, at 3:30 pm, he was rear ended again.

The defendants successfully obtained a dismissal because the trial judge accepted their argument that the plaintiff was required to prove what portion of his injuries was caused by the first accident and what portion was caused by the second accident. The plaintiff’s doctor had submitted a report that it was not possible to determine which injuries resulted from which accident. Further, although the plaintiff did not plead an aggravation of previous injuries, the trial court held that the plaintiff was required to differentiate between the prior injuries and the injuries caused by the new incidents.

On appeal, the Appellate Division disagreed. The Appellate Division concluded that (1) because the plaintiff did not plead aggravation, he was not required to offer a medical analysis comparing his past and current injuries and (2) defendants, as opposed to plaintiff, should have been assigned the burden to differentiate the causative effect of the respective collisions.

Because these claims involved successive accidents and the plaintiff was unable to present evidence to a jury as to apportionment, the appeals court ruled that the plaintiff’s claim should not have been barred. The Appellate Division held that the defendants may present evidence to enable the jury to allocate damages among them. If such evidence is unavailable, then the court will equally allocate damages.

Plaintiffs German Automotive of Tinton Falls, Inc. and its owners Nicholas and Robyn Rossi suffered damage to their building when a vehicle driven by Rafael Vera-Hernandez drove into it. At the time, their building was insured under a Deluxe Garage Owners Policy with Harleysville Insurance Co. A dispute ensued with Harleysville as to the extent of the damage to their building. In German Automotive of Tinton Falls, Inc. v. Harleysville, dkt. No. A-2571-13T3 (July 29, 2014 App. Div.), the plaintiffs contended that Harleysville breached its policy due to its failure to arbitrate this claim.

Harleysville claimed the building could be repaired but the insureds claimed that structural damage to the building required major reconstruction and relocation costs. Plaintiffs made a demand for appraisal of the loss to resolve this dispute but Harleysville refused, claiming that it objected to the plaintiffs’ proposed appraiser and it had not received copies of the estimates that had been prepared.

The plaintiffs filed suit, seeking to compel an appraisal of the loss and arbitration. They contended that the Harleysville policy required “appraisal arbitration” in cases where there was a dispute as to the amount of damages. The plaintiffs filed a motion to compel an arbitration but the trial court denied the motion.

The Appellate Division upheld the trial court’s ruling. It found that the appraisal-dispute provision in the Harleysville policy is not an arbitration agreement. An appraisal provision is not the equivalent to an arbitration agreement. Further, it found that the policy requiring appraisal only pertained to the amount of the loss. The appraisal process was not intended to resolve disputes as to the extent of damage, the scope of work required, or the cause of the damage.

Moreover, in this case because the plaintiffs proceeded to litigate the case after their initial request for arbitration was denied, even if they had a right under the policy to arbitrate the dispute as to its claim, they waived the right.

In the case of Taveras v. Roman, 2014 N.J. Super. Unpub. LEXIS 1728 (App. Div. July 16, 2014), the court had to decide on appeal whether a minivan that is used as a school vehicle falls under the definition of “automobile” under N.J.S.A. 39:6A-2(a). The plaintiff Angela Taveras was injured in a motor vehicle accident while driving home in a minivan owned by her employer, School Tyme Transportation. She applied for PIP benefits from her personal insurer (CURE) who denied her application.

CURE filed a motion for summary judgment, requesting an order that Taveras was not entitled to PIP benefits because the vehicle she was operating was not an “automobile” as defined in the statute. The trial court judge denied the motion. He made no finding as to whether the vehicle qualified as an “automobile.” Instead, he focused on its use at the time of the accident, which was for the plaintiff’s personal use.

The Appellate Division affirmed the trial court’s order. However, its decision was based upon the classification of the vehicle, not its use.

School Tyme contracted with various school districts for the transportation of special needs children to and from school. It allowed Taveras to use one of the minivans for travel to and from work and to keep the minivan overnight. The collision occurred after the end of her work day, as she was driving home. The minivan’s rear bumper was clearly marked with the words “SCHOOL VEHICLE” and its license plate showed that it had commercial vehicle plates.

The meaning of the term of “automobile in N.J.S.A. 39:6A-2 focuses first on the type of vehicle and then its use. The statute establishes two categories of vehicles subject to PIP coverage. The first category applies to “a private passenger automobile of a private passenger or station wagon type.” This is to distinguish it from public passenger automobiles, such as taxis and from private freight automobiles, such as trucks.

A minivan would be considered to be a “station wagon type automobile.” Thus, it falls into the first of the categories of automobiles in the statute. Hence, it is not relevant whether it is used for business purposes.

However, CURE argued that the minivan is not an “automobile” because it is a school bus under N.J.S.A. 39:1-1. The Appellate Division found that “school buses” are not excluded from the definition of “automobile.” Hence, the appeals court found that the minivan driven by Taveras was an automobile under N.J.S.A. 39:6A-2(a) and CURE may not deny her PIP benefits.

Back in May 2007, the New Jersey Administrative Office of the Courts (“AOC”) issued a directive (Directive #4-07) to all trial court judges that required that some open-ended questions be asked of jurors during the voir dire process. In New Jersey, only the judges can question prospective jurors. The purpose of this directive was to ensure that jurors verbalize their answers so that the court, the attorneys, and the litigants can better assess their attitudes and any possible bias or prejudice, which is not evident from a yes or no answer. In Erga v. Chalmers, 2014 N.J. Super. Unpub. LEXIS 1730 (App. Div. July 16, 2014 ), a no cause jury verdict was reversed because the judge failed to ask any open ended questions during the voir dire process.

Erga involved an expedited jury trial arising out of a motor vehicle accident. The plaintiff’s counsel requested that sample question no. 6 from the directive be posed to the jury. This question inquired: “Do you believe that you will make a good juror for this case? Please explain.”

The judge refused to ask the question as it was suggested by the AOC because he was apparently concerned as to the length of the jurors’ answers and how that would impact the time to complete juror selection. Instead, he asked it the reverse: “if there’s some reason why they feel they can’t be a good juror.” The plaintiff’s counsel objected because, by asking the question in the negative, no one would say no and it would not serve its purpose of having the jurors respond with at least a several sentence answer.

The jury returned a no cause verdict and the plaintiff filed this appeal. The defendant argued that the plaintiff must come forward with some evidence that the process employed was biased or unfair before a reversal was merited. However, the Appellate Division found that the court’s refusal to ask any open-ended questions, as mandated under this directive, was presumptively unfair and warranted a reversal.

The court pointed out that this was not a situation where the court asked some open-ended questions but phrased them differently than the AOC sample questions. The phraseology of the open ended-ended questions was to be left to the discretion of the trial court. However, what is not discretionary was the failure to ask any open-ended questions. Thus, the Appellate Division vacated the judgment entered in favor of the defendant and remanded the case back to the trial court for a new trial with jury selection to comply with Directive #4-07.