Compensability

It can be difficult to predict the outcome of appeals where the issue before the Judge of Compensation is credibility of witnesses as opposed to pure legal issues.  In Frank Hodson v. C. Abbonizio Contractors, Inc., A-2083-14T3 (App. Div. May 2, 2016), Mr. Hodson said that while working as a laborer on May 9 and May 10, 2013, he threw a traffic barrel and “felt a small click-like pop in his back.”  He finished his shift and did not notify his supervisor, Dan Trainer, of the injury because he was distracted when he was informed that a “crash truck” was hit by a vehicle, requiring him to respond immediately.

Hodson said he was sore while driving home that night and was in a lot of pain.  But he continued to work the next week.  Not until May 26, 2013 did he admit to notifying his employer.  He said his co-worker, Ray Batot, saw him limping on May 26, 2013 and asked him what was wrong.  Hodson said that he injured his back.  Hodson also said that he spoke with Tom Abbonizio and Trainer on May 26, 2013, informing them of his back injury.  Hodson saw a personal physician who provided him with two epidural injections after the accident.  He also was taking 10 milligrams of Percocet.

When his doctor took him out of work, Hodson called Human Resources and was informed that he could not collect workers’ compensation benefits because no incident report was filed.  Hodson was told to seek unemployment benefits.  He filed for those benefits through his family doctor, who certified that his injury was not work related.  Later petitioner filed a claim petition against Abbonizio and against his previous employer for a 2012 injury to his back and legs.

There were some inconsistencies that were brought up in trial.  Hodson admitted having Trainer’s cell phone number but said he did not call him because of the crash truck incident that was more pressing.  He also said he did not know that there were two hospitals he was permitted to go to in the event of a work injury, but he admitted that his co-worker Batot had been taken to one of those two hospitals on May 10, 2013 for Batot’s own work injury involving the crash truck.

Perhaps the most glaring discrepancy concerned prescription medications.  On direct examination, petitioner denied taking any prescription medications before the date of the alleged injury.  On cross examination he conceded that he was taking Lyrica for pain as of May 10, 2013, and he was also taking Percocet before May 10, 2013.  He had had prior back injuries and prior workers’ compensation claims.  Hodson then maintained that he increased his medications after May 10, 2013.

Petitioner contended that he told his family doctor, who treated him after the alleged incident on May 9 or May 10, 2013 that he injured his back throwing barrels.   However, Dr. Winfield put on the TDB application that his injury was not work related.  There is no indication in the record of this case that Dr. Winfield testified at trial.

Petitioner offered corroborating testimony from his co-worker, Batot, who said he was working with petitioner and saw him moving barrels on the day petitioner claimed to have hurt himself.  Batot also said he spoke with Tom Abbonizio about petitioner’s back issue.  Batot said he was injured on the same night as petitioner (Batot was driving the crash truck) but that earlier in the day he saw petitioner limping.

Two other lay witnesses testified at trial.  Ms. Carmen Ferrillo, HR Manager, said that petitioner told her the injury took place on May 14, 2013 (not May 10^th).  She spoke with Trainer and was told petitioner never mentioned a work injury.  She denied telling petitioner to file for unemployment benefits.  For his part, Trainer said that he did not see petitioner move any barrels on May 10, 2013.  He said petitioner never informed him of a work injury.

One medical witness testified, Dr. Joseph Zerbo.  He said he saw petitioner on July 23, 2014.  Dr. Zerbo compared prior MRI films from 2011 with those of June 2013.  He said that there was a “worsening of the disease process” which the doctor attributed to the alleged work injury.

The Judge of Compensation, the Hon. Audrey Kernan, ruled for petitioner, requiring the payment of medical and temporary disability benefits, based primarily on her assessment of petitioner and Batot as being more credible than the other witnesses in this case.  She also credited the testimony of Dr. Zerbo. The Appellate Division affirmed on the basis that there was sufficient evidence to support the credibility findings of the Judge of Compensation.  While there was a potential dispute in this case between prior employers for previous back injuries and Abbonizio Contractors, the court left that issue for the future when the permanency issue should be reached.

The case demonstrates the difficulty respondents have when there is really no legal or medical issue in the case and the dispute centers on conflicting testimony of various witnesses. Based on this record, a judge of compensation could have made a convincing argument that the claim was not work related and never happened at all.  There was a plethora of inconsistencies and perhaps outright misrepresentations (such as not using pain medications before the accident) which would have formed a solid basis for denial.  But there was also strong testimony from a co-worker supporting the petitioner.

The lesson in cases like this is that the Judge of Compensation controls on credibility findings.  Appellate courts will not reverse unless there is insufficient evidence to support the decision of the Judge.  That is a high standard for either party to overcome on appeal.

Most employers have some recreational or social activities throughout the year, and unfortunately, injuries tend to occur at these events.  There used to be so many of these kinds of claims that the New Jersey Legislature enacted new legislation in 1980 under N.J.S.A. 34:15-7, which provides that recreational and social activities do not arise from the employment “unless such recreational or social activities are a regular incident of employment and produce a benefit to the employer beyond improvement in employee health and morale.”

So under this rule a volunteer firefighter who was injured playing softball for the fire department team was not covered for workers’ compensation because his participation in the softball game was not required and was purely for morale purposes.  Dowson v. Borough of Lodi, 200 N.J. Super. 116 (App. Div. 1985), certif. denied. 103 N.J. 455 (1986). Similarly, a supervisor asked one of his employees if he would like to arm wrestle the supervisor, and the two men arm wrestled during work hours with injuries resulting to the employee.  The court also found this case not compensable as a recreational claim involving only morale.  Quinones v. P.C. Richard & Son, 310 N.J. Super. 63 (App. Div. 1998), certif. denied. 156 N.J. 384 (1998).

But what about the situation where a teacher engages in a volleyball game with students and parents on school premises and the event has been advertised by the school, asking for volunteers to participate in the event?  These kinds of activities occur at many schools in New Jersey and in other states on a regular basis.  Often the event is an annual one, which tends to satisfy the clause above being a regular incident of employment.  There are often notices about the event throughout the school and teachers are encouraged to participate.  Suppose a teacher is later injured and brings a workers’ compensation claim, seeking medical treatment, temporary disability benefits and an award of partial permanent disability? The question is this:  does this activity involve a benefit to the employer beyond improvement in health and morale or is it just about morale?

There are no published decisions on this particular issue but these types of injuries happen frequently.  The main reason for the absence of published decisions is that most practitioners and judges believe these kinds of injuries involving teachers in parent/faculty/student events are compensable.  So the cases tend to be accepted from the outset.  The advertised parent/faculty/student volleyball game on school premises is not just about promoting health and morale.  That is definitely part of it, but counsel for the injured teacher will successfully argue that the activity is really about improving the relationship among parents, students and teachers, with the ultimate goal being a better learning environment.  The goal of education and student enrichment goes well beyond merely promoting health and morale. If the activity promotes a benefit beyond improving health and morale, the activity is compensable.  Raising funds for the employer would be another example of something that is beyond improving health and morale.

Contrast this with a situation where a teacher steps into the gym to shoot a few baskets on the way to his or her next class with a student he knows and then falls, fracturing an arm.  This sort of activity is spontaneous, unplanned, and more about morale than anything else.  Judges would likely find this sort of injury not compensable.

In 2004 an important decision came down from the New Jersey Supreme Court which added a new dimension to the equation.  That case is Lozano v. Frank Deluca Const., 178 N.J. 513 (2004).  Mr. Lozano was seriously injured driving a go-cart on the property of a customer where the company was doing masonry work.  Lozano was a skilled mason who was picked up by his boss in the morning and taken to the homeowner’s large property where they worked all day.   After work the boss asked permission from the homeowner to drive one of the go-carts on his private track.  The homeowner and the boss drove their go-carts around the track.  Then the boss asked the claimant if he wanted to take a spin.  Mr. Lozano reminded his boss that he had no driver’s license and did not know how to drive, so he refused.  The boss then told Lozano to get in the go-cart and drive.  Lozano did just that and proceeded to drive the go-cart into a parked truck, suffering serious injuries. At trial, Lozano said he felt that he had to follow orders from his boss, but he did not want to drive the go-cart in the first place.

The Supreme Court announced a sensible rule that when an employer compels activity that would ordinarily be barred as a social or recreational one, that activity becomes compensable.  The Lozano rule has been followed by courts in many other decisions. What it means for an employer is this:  if the employer pressures employees to attend holiday parties or participate in otherwise barred recreational activities, any injuries flowing from those activities will be found to be compensable in workers’ compensation based on the element of compulsion.  Hence the adage:  if you have to do it, what you are doing is likely compensable under workers’ compensation.

Jennie Rosario worked for the State of New Jersey as a caseworker for the Division of Youth and Family Services.  She left the Division’s Maplewood office intending to get into a State-owned vehicle on May 23, 2006 to perform her duties as a field case-worker.  As she was leaving the office, her ex-husband assaulted her with a knife, slicing her head.  A fellow Division employee managed to distract the ex-husband, who then stabbed himself with the knife.  Petitioner then filed a workers’ compensation claim for her injuries.

Days before the attack, petitioner Rosario had been granted a divorce judgment.  Rosario had also previously obtained a domestic violence final restraining order against her ex-husband for attempting to murder her mother. Her supervisor had a copy of the restraining order. Security guards were notified of the threat posed to Rosario.  Indeed, she asked for the transfer to the office in Maplewood from the East Orange Division office because she was worried about her ex-husband’s release from jail.  She feared that he would come to the East Orange office location.

When Rosario’s ex-husband got released from jail, he devised a plan to reach out to her in order to apologize to her for his past criminal acts.  On release from jail, her ex-husband contacted the Division’s East Orange office to find her.  The receptionist told the ex-husband that she had just been transferred to the Maplewood office. That information led the ex-husband to travel to the Maplewood office where the assault occurred.

The Judge of Compensation held that this attack was a purely personal risk, not incident to Rosario’s employment, and therefore not compensable.  Petitioner’s ex-husband testified that the reason that he went to see Rosario was both to apologize for his criminal behavior and to see if the two could reconcile.  The Judge of Compensation reasoned that this assault could have occurred anywhere.  The ex-husband tried calling petitioner on her cell phone first without success, and he only contacted the Division because he wanted to meet her in a public place.

Rosario argued that since the State disclosed her new location in Maplewood, this was no longer a personal risk.  She contended that the State’s actions led to the likelihood that the assault would occur at work.  Rosario’s contention was that the State had a duty not to disclose her location given that it was in possession of the restraining order.

On appeal, the court reviewed the case of Howard v. Harwood’s Rest. Co., 25 N.J. 72 (1957) for the proposition that when an attack arises out of a personal relationship, there is no right to workers’ compensation. The Court concurred with the Judge of Compensation that the attack stemmed not from work but from a personal relationship outside work.  The Court disregarded the argument that the State had been negligent in offering petitioner’s new location. “Whether an employer actually commits a negligent act is irrelevant to determining compensability – the sole issue is whether the injury is work-related.”

This case is now the second in a few months in which the Appellate Division has found assaults that occurred at work were not compensable because of the personal relationship between the criminal actor and the petitioner victim.  This case can be found at Rosario v. State of New Jersey, A-4526-13T3 (App. Div. January 28, 2016).

In an extension of the principle established in Cunningham v. Atlantic States Cast Iron Pipe Co., 386 N.J. Super. 423 (App. Div. 2006), the Appellate Division ruled on January 22, 2016 that an employee who was fired while on light duty was not entitled to temporary disability benefits because the firing was not related to his injury.

The case, entitled Katzenstein v. Dollar General, A-1141-13T3 (App. Div. January 22, 2016) arose from a compensable accident on August 22, 2012 when Mr. Katzenstein, a store manager, injured his knee, requiring authorized treatment.  On September 19, 2012, Dollar General returned Katzenstein to light duty work.  On September 28, 2012, Dollar General terminated Katzenstein for leaving several employees in the store without supervision while he went to the bank to deposit the previous day’s earnings.

Following his termination, petitioner Katzenstein filed for unemployment benefits; however, he was denied benefits because he was terminated for misconduct.  On October 17, 2012, Dr. Basch, the authorized treating doctor, opined that petitioner could not work due to his knee injury.  Katzenstein continued to treat with Dr. Basch, who maintained the light duty restriction with no lifting over 25 pounds.

Katzenstein filed a motion for medical and temporary disability benefits in the Division of Workers’ Compensation. He relied on Dr. Basch’s opinion that he could not work at all because he needed knee surgery.

On February 28, 2013, a consent order was entered providing that the parties agreed without prejudice that petitioner would receive temporary disability benefits from November 14, 2012 to February 14, 2013.  When the three months ended, Katzenstein filed a motion to enforce the order and to obtain ongoing temporary disability benefits.

In his motion, Katzenstein misstated the reason he did not get unemployment.  He asserted that he lost his unemployment claim because “was unable to engage in employment due to the injury to my right knee.” He did not mention that he had been denied benefits because he had been fired for misconduct.  The Judge of Compensation focused on this misrepresentation and the fact that Katzenstein’s injury was not the reason he left his job. Rather, he was fired for misconduct.  The Judge noted petitioner was lacking in candor and also noted that there was no evidence that petitioner had any prospect of new employment.  Petitioner then filed an appeal.

One week before the Judge of Compensation issued his decision, the Board of Review overturned the denial of unemployment benefits on the basis that petitioner’s conduct was reasonable and not an act of misconduct.

The Appellate Division applied the rule in Cunningham and said that the two cases were similar because the petitioner in Cunningham was injured on the job, returned to work, but was subsequently terminated and found not entitled to continuing temporary disability benefits while recovering from surgery.   In this case petitioner was injured on the job, placed on light duty, and then fired for a violation of company policy.  The court said that the burden was on petitioner to prove that he would have worked.  The Court said, “In determining that Katzenstein was not credible, the judge found he was neither offered employment after he was terminated nor declined employment due to his work-related disability.”  The Court wrote:

Here, the judge of compensation properly applied Cunningham.  The judge assessed whether Katzenstein, after being terminated, had a promise or prospect of employment that he had to forego due to his disability.  In determining that Katzenstein was not credible, the judge found he was neither offered employment after he was terminated nor declined employment due to his work-related disability.

This case is an important one.  It is the first Appellate Division case dealing with the right of the employer to terminate temporary disability benefits following job termination after an employee has been placed on light duty. The case does not discuss the rule in Harbatuk, which is that an employer can terminate temporary disability benefits to someone who turns down light duty.  This employee accepted light duty and presumably thought his temporary disability benefits would continue until he could either return to work full duty or until maximal medical improvement.  The Katzenstein case now applies the Cunningham rule to situations where someone is fired while on light duty for reasons unrelated to the work injury.  Petitioner was not able to show that he was fired because of his injury or that he had prospects of employment which he was unable to perform because of his injury.

Rose Fonrose Louis worked at a Burger King restaurant in the Monmouth Mall in Eatontown, N.J.  On August 29, 2008, Louis was working in a walk-in freezer when an assistant manager, Hany Salib, followed her into the freezer and proceeded to touch her breast and buttocks through her clothes, kissing her neck, and attempting to insert his tongue into her mouth.  While she was in the freezer, Emad Ghaitey, the manager of the restaurant, opened the door, looked at both employees, and then left.  When the door had been briefly opened, Salib ceased touching Louis, but later in the same day, Salib again touched her and kissed her in the freezer.

Louis did not report either incident on the day the two incidents occurred.  However, the following day, Louis’s husband called to complain about how his wife had been treated.  Louis’s husband then came to the restaurant the following day to provide more details of the alleged assault. Burger King had a written policy prohibiting workplace harassment which all employees received.  Ghaitey followed the policy and reported the allegations to the district manager, who conducted an investigation.  Salib was suspended, then transferred to another store, and eventually terminated when he did not report to work.  Louis ceased her employment with Burger King two weeks after the alleged assault.

On September 10, 2008, Louis reported the two incidents to the local police, who arrested Salib and charged him with fourth-degree criminal sexual contact.  Salib pled guilty to a down-graded charge of violating an ordinance.

In March  2009, Louis brought a workers’ compensation claim against QQR, (the restaurant owner), alleging workplace injuries and sexual assault. That case was settled for $7,500 on a Section 20 basis.  Louis and her husband also brought a civil claim against Salib, Burger King Corporation, QQR, and Ghaitey.  The claims against Burger King were dismissed and the claims against Salib were settled and dismissed.

The remaining defendants, QQR and Ghaitey, moved for summary judgment, arguing that the civil suit was barred by the exclusive remedy provision of the workers’ compensation act. The trial judge dismissed the suits, and Louis and her husband appealed.  They relied on a 1988 federal case, Cremen v. Harrah’s Marina Hotel Casino, 680 F. Supp. 150 (D.N.J. 1988) where the court held that the civil suit survived the workers’ compensation bar.  The Appellate Division in this case held that the facts in Cremen were distinguishable.

In Cremen, the employee lodged a verbal complaint against a supervisor employee who sexually assaulted her. . . She was assured by a Harrah’s employee in charge of investigating such allegations that the supervisor would be promptly dealt with. . . Harrah’s failed, however, to address the matter and the harassment continued. . . . When Harrah’s moved for summary judgment arguing that the Act barred the employee’s common-law claims, the district court denied summary judgment because Harrah’s was put on notice and failed to take action.  . . As already pointed out, there are no facts showing that QQR or Ghaitey had any prior notice of Salib’s intentional actions, and when the complaint was brought to QQR’s attention, prompt action was taken and no further harassment occurred.

 The Appellate Division held that this case was simply a matter of negligence.  It felt that Ghaitey acted negligently in that he should have asked what was going on when he walked in to the freezer.  To get past the workers ‘comp bar, Louis had to prove intentional conduct, but the court said that this sort of inaction cannot be equated with intentional harm.  The court also held that QQR engaged in no conduct that could be deemed to be intentional.  It acted consistent with its harassment policy once the claim was reported. Therefore, the workers’ compensation act barred the civil suit against both Ghaitey and QQR.

This case illustrates once again how strong New Jersey’s workers’ compensation bar remains.  It is exceedingly difficult for a plaintiff to prove intentional harm.  The case can be found at Rose Fonrose Louis and Fritzner Louis v. Burger King Corporation, et. al., (A-1000-14T2, App. Div. December 4, 2015).

Colleen Fitzgerald filed a claim petition alleging that on April 26, 2010 she was walking down an alley as a zone merchandising supervisor for Walmart, when she suddenly felt a “pop” in her lower back.  She admitted that she was simply walking at the time the incident occurred.  However, prior to this popping incident she said she was doing some lifting at work.  She experienced severe pain radiating into her buttocks and down her legs.

Fitzgerald reported the injury to her zone manager but she did not fill out an accident report at that time.  She thought the pain would subside.  The next day at work the pain was more severe, causing her leg to give out and requiring her to leave work.  She saw her family doctor on April 29, 2010 who prescribed for her two medications and an MRI.

Fitzgerald took FMLA leave for the next 12 weeks.  On May 13, 2010 the MRI was performed revealing protruding discs at L4-5 and L5-S1 with mild displacement of the right L5 and S1 nerve roots.  Fitzgerald also saw a chiropractor in May 2010.

Fitzgerald attempted to return to work following her FMLA leave but still had pain.  In June 2011, she sought additional care when her back pain increased after a coughing spell.  She then took a second leave of absence while getting epidural injections.

In September 2011, Fitzgerald was involved in a non-work-related slip-and-fall in which she broke her elbow, requiring a third leave of absence.  She did not return to work and her employment was terminated.  However, her back treatment continued into December 2013.

Fitzgerald filed two claim petitions in April 2012: first, she argued that a traumatic accident occurred on April 26, 2010; second, she argued that her injuries were the result of occupational exposures from December 2008 until April 2010.  In December 2013 she filed a motion for medical and temporary disability benefits.  Petitioner testified in support of her motion as well as her medical and psychiatric experts.  Respondent produced its orthopedic expert and offered the report of its psychiatrist in evidence.

Both experts agreed that petitioner had protruding discs at L4-5 and L5-S1 but they disagreed completely on causation. The Judge of Compensation ruled for Walmart and dismissed both petitions.  Petitioner filed an appeal and the Appellate Division affirmed the dismissal of the cases.  The Court reviewed prior case law for the requirement that petitioner prove her injury would not have occurred but for her employment.

Applying the test, the judge concluded the petitioner failed to satisfy the first step of the test, in part because ‘[t]he facts here do not establish that the petitioner would not have been exposed to the risk if she had not been at work.’ An appellate court must give ‘due regard to the opportunity of the one who heard the witnesses to judge of their credibility’ and owes deference to the judge’s expertise in workers’ compensation issues.

 This case was handled successfully for Walmart by Lora Northen, Esq., partner with Capehart Scatchard, with assistance from Andrea Schlafer, Esq. on the legal briefs.  The case underscores the rule that just because an event happens at work does not mean it is compensable.  There are many health issues that occur during work but are not necessarily caused by work.  Feeling pain in one’s joints or spine while walking is not work related unless work effort or work premises cause or contribute to the medical condition.  This case can be found at Fitzgerald v. Walmart, A-1186-14T3 (App. Div. November 20, 2015).

Most assaults by an employee on another employee on work premises are compensable for the victim of the assault, but the facts in Joseph v. Monmouth County, A-4144-13T3 (App. Div. December 14, 2015) were most unusual.

Lesley Joseph was a nursing supervisor at a Monmouth County owned nursing home.  On June 9, 2011, Mr. Joseph was taking a break in the break room, had his feet up and his eyes closed, when his female assistant attacked him with a hammer, causing multiple injuries and cuts on his face and head.  Joseph managed to wrest the hammer away from his attacker and asked for help.  Police and paramedics responded and took him to the hospital.  Joseph filed a workers’ compensation claim which the County investigated, finding circumstances behind the attack that cast grave doubt on the compensability of the claim.

Through its investigation, the County learned that Joseph had become involved in a pyramid scheme run by his assistant.  This scheme was called a “susu,” which required an investment in which participants put money into a pot and then take turns sharing the amounts collected.  An example was provided where 20 employees would contribute $100 each week, then over the course of 20 pay periods, each employee would take turns collecting $2,000 during his or her assigned week.  No interest was paid.

Joseph participated in the “susu” on three occasions but never collected any funds.  Participants became concerned when the petitioner’s assistant said she had an upcoming wedding.  Petitioner tried to talk to his assistant, but she avoided him.  On June 9, 2011, he approached his assistant and talked about what rounds needed to be done on her shift but then started telling her that everyone in the “susu” was upset because people in the pool who were supposed to be paid the week prior had not yet been paid.  Joseph emphasized that he himself was supposed to be paid the next week.  The assistant admitted that she had to use some of the money but assured petitioner that he would get his money.  Shortly thereafter the assistant attacked petitioner and eventually pleaded guilty to aggravated assault with a deadly weapon.

The Honorable Lionel Simon III, Supervising Judge of Compensation, Monmouth vicinage, held that the confrontation between the two employees did not arise from work but rather from the fact that Joseph felt he was not going to be paid on time.  Judge Simon further found that there was no nexus to work at all. The mere fact that the attack happened at work was not sufficient for coverage because it did not arise from work activities. Petitioner appealed the dismissal of his case.

The Appellate Court said, “Assuming there was no prohibition against sleeping in the break room, petitioner’s claim still could not be sustained because its origins were only related to his involvement in the susu scheme, a personal connection to the assistant that resulted in injuries for reasons wholly unrelated to their employment.”  The Court said that the attack arose from personal motivation and was not attributable to a risk of employment.  “Had petitioner not been a participant in his assistant’s susu, the attack would not have occurred. Once he became involved and questioned his assistant about the ‘invested’ money, he was attacked at a location that just happened to be their place of employment.”

The petitioner argued that work brought the two employees together and created the conditions that resulted in the confrontation.  However, the Judge of Compensation and the Appellate Division both noted that this was a case where the friction between the two employees arose from purely personal reasons unrelated to the work that they performed at the county nursing home.

This decision is a significant one because it illustrates the exception to the general rule that the victim of an assault at work at the hands of a co-employee is generally covered.  If the origin of the animus is purely personal, having nothing really to do with work, neither the victim nor the aggressor is covered.  This case was successfully handled at both the trial level and the appellate level by Carla Aldarelli, Esq., partner in Capehart Scatchard.

Samuel Roman formed Treeminator Tree Services, Inc. in 2007.  By 2012 he and his girlfriend, Sandra Flores, were both employees along with two others.  In 2009 Roman sought workers’ compensation coverage with NJM for Treeminator Tree Service, LLC, a company with no employees and engaged in landscaping work but not tree trimming.  He obtained the same type of policy in later years with Technology Insurance Company, part of the Amtrust Group.

On May 4, 2012, Roman was cutting down a tree when he fell and suffered very serious injuries. He filed a workers’ compensation claim against Technology Insurance Company, which denied the claim on the ground that the policy indicated that Treeminator was an LLC with no employees.  Petitioner then filed a Motion for Medical and Temporary Disability Benefits, and a full trial ensued with testimony from petitioner, his girlfriend, and three witnesses associated with the insurance broker.

The Judge of Compensation, the late Honorable Virginia Dietrich, ruled that petitioner made material misrepresentations in procuring his insurance application and was not entitled to coverage. She found that Mr. Roman provided false information in obtaining his policy in that all of his workers’ compensation policies indicated that he had no employees.  The application for the Technology policy described the business as a “one man operation – no employees.”

Further, the Judge of Compensation noted that Roman also misrepresented the nature of the business as one involving landscaping instead of the high risk work of tree removal and tree trimming.  She noted that the premium would have been significantly higher if Roman secured a policy for a business involved in tree removal and tree trimming.

Judge Dietrich also addressed Roman’s rejection of workers’ compensation coverage.  Although Treeminator was originally organized as a corporation, Roman secured coverage for Treeminator as a LLC.  The statute requires a member of an LLC who is seeking coverage within the LLC’s workers’ compensation policy to sign an election form at the inception of the policy.  An election form was provided to Roman.  The form was dated and clearly noted “coverage is rejected.”  This form was kept by the broker.  The Judge of Compensation found the form to meet the minimum requirement of the statute and noted that the premium on the policy would have been substantially more expensive if Roman did not reject coverage.  She concluded that Roman did not intend to cover himself when he procured his workers’ compensation policy.

Roman appealed and contended that his broker erred in not procuring for him a policy listing his company as a corporation.  He argued that he himself should not suffer due to his broker’s error.  The Appellate Court noted that the Judge of Compensation rejected this argument because it was clear from the evidence at trial that false information was provided by Roman’s business manager to the insurance broker in an effort to pay the absolute lowest amount possible for coverage on a landscaping business organized as a Limited Liability Corporation (LLC) with no employees. The Appellate Court also noted that the policy secured by Roman lacked a surcharge for either the Uninsured Employers Fund or the Second Injury Fund.  Both funds include statutorily mandated surcharges based upon the number of employees and the absence of both surcharges further evidenced the lack of employees.    The Court said, “When apprised of the increased costs of insuring a company with employees, Roman chose to ‘take coverage as cheaply as he could find it.  He wanted to pay the least and hoped for the best.’”

 The Appellate Court agreed with the Judge of Compensation that there was sufficient credible evidence in the record to support the finding that petitioner made a material misstatement of fact under N.J.S.A. 34:15-57.4, thereby warranting dismissal.  This matter was handled successfully by Nick Dibble, Esq. of Capehart Scatchard with assistance on the brief from the undersigned.  It can be found at Roman v. Treeminator Tree Service, A-0094-14T2 (App. Div. December 2, 2015).

Robert Miller worked as customer service and bookkeeping associate at Saker Shoprite from 4:00 p.m. to 11:00 p.m.  On January 29, 2010, Miller came to work to pick up his paycheck at 10:00 a.m.  The store allowed employees to do direct deposit or to pick up their paychecks in person.  While he went in to get his paycheck, someone waited in the car outside. One fellow worker described Miller as wearing what appeared to be pajamas.

Miller picked up his paycheck at the courtesy desk and then cashed it.  He also bought a lottery ticket for a co-worker who was working a register in the checkout area as a cashier.  He walked over to the co-worker, handed her the lottery ticket, turned and headed toward the store exit.  As he exited, he slipped on a substance that may have been sugar or salt, falling to the floor and injuring his knee.  He was diagnosed with a medial meniscus tear.

Miller filed both a workers’ compensation claim and a parallel personal injury action in the Law Division.  The Judge of Compensation heard testimony and ruled that the accident was compensable.  The judge relied on the fact that the store allowed its employees to cash their paychecks at the store.  In the judge’s mind, this indicated that the store intended to benefit by “impulse buying” of workers who came to cash their checks in person.  The judge awarded 17.5% disability of the leg or $11,686.50.

Saker Shoprite appealed and contended that there was no legal support for a finding of compensability.  The Appellate Division reversed the Judge of Compensation, noting that petitioner was not performing any work duties at the time of his injury.  He was not dressed for work and was only there to do a personal task, namely pick up his paycheck.  In addition, the court noted that petitioner performed one other personal task in buying a lottery ticket for a co-worker.

In finding that the fall was not compensable, the court had to distinguish this case from Chen v. Federated Dep’t Stores, Inc., 199 N.J. Super. 336 (App. Div. 1985).  In that case an injury to a Federated employee was found compensable during lunch hour when the employee tripped on a clothes hanger while shopping in the store.  The Appellate Division in that case found that the lunch-break shopping was beneficial to the employer and encouraged by the employer.

In this case the court said that Miller’s injury did not occur during a lunch break but many hours before his work shift would begin.  The court also found that Miller never offered proof that Shoprite benefited from having employees pick up checks in person.  The benefits manager of the store testified that employees were generally discouraged from remaining in the store if they were not working or shopping.  The court said, “[t]here is no testimony that the store actively encouraged such conduct by check-cashing workers.  The practice was merely a gratuitous convenience provided by the employer.”

In reversing the Judge of Compensation, the Appellate Division allowed Miller to reactivate his civil suit against the store.  This case may be found at Miller v. Saker Shoprite, A-3746-13T2 (App. Div. November 13, 2015).

In New Jersey it remains extremely difficult to bring an intentional harm claim against one’s employer.  Mere knowledge and appreciation of a risk is not intent.  That was the holding in Keller v. Township of Berkeley, A-5767-12T3 (June 22, 2015).

Mr. Keller worked as a laborer for the Township sanitation department and suffered serious injuries when he fell from a moving garbage truck after the passenger-side door suddenly opened.  He argued that there had been many complaints about the truck’s door over several years and that the Township was aware that the door latch mechanism was not functioning well.  Keller further argued that the Township violated safety standards by failing to repair the problem.

The Township, for its part, denied that it was aware of any problem with the truck and noted that an inspection by the State Police post-accident did not reveal any problem with the locking mechanism.  No OSHA violations were ever issued.

The trial judge granted summary judgment dismissing the law suit and plaintiff Keller appealed.  The trial judge did concede that there was evidence that the door latch mechanism had not been working well for a long time, and the Township was aware of this but did not fix the problem.  Nonetheless, the trial judge concluded that knowing there is a risk is not the same as intentional harm.

The Appellate Division affirmed the dismissal of the case.  It stated, “Having reviewed the record in light of these precedents, we agree with the trial court that the unfortunate accident that Keller suffered does not satisfy the substantial-certainty standard required to vault the Act’s exclusivity bar.”  Even if the conduct of the Township was grossly negligent, that is not enough to prove an intentional harm claim.  There were no OSHA violations at all, and there was no evidence of a prior similar incident where an employee was actually injured.  The court noted that there was no effort by the Township to remove the latch or perform some action that created additional danger to employees.  While the truck’s door was difficult to open and close, that in itself does not prove intentional harm.

The Appellate Division also affirmed the trial judge’s dismissal of a claim for fraudulent concealment of evidence and spoliation of evidence.  The Court said “At best, plaintiffs established sloppy record keeping by the Township.  There was simply no showing ‘[t]hat defendant intentionally withheld, altered or destroyed the evidence with purpose to disrupt the litigation’ as required by Rosenblit v. Zimmerman, 166 N.J. 391, 406-07 (2001).’”