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Defendant Barred from Suing Public Entity Due to Failure to File Timely Tort Claims Act Notice

On July 27, 2017, the New Jersey Supreme Court decided important issues concerning the ability of a defendant to sue a public entity in a third party claim.  In the case of Twanda Jones v. Morey’s Pier, 2017 N.J. LEXIS 812 (July 27, 2017), the Supreme Court decided that a defendant is barred from asserting contribution and common law indemnification claims against a public entity under the Tort Claims Act if a timely notice of tort claim was not filed.  The Supreme Court also decided how fault may be allocated against a public entity regardless and the effect of any such allocation of fault on plaintiff’s recovery of damages.

The Jones case dealt with the tragic death of 11 year old Abiah Jones after she fell from a ride in an amusement park during a trip organized by her charter school, Pleasant Tech Academy Education Association (“Association”), which is treated as a public entity for the purposes of the Tort Claims Act (“TCA”).  Her parents filed a wrongful death action against Morey’s Pier and other Morey defendants, alleging that their daughter’s death resulted from the negligent operation of the park.  However, the plaintiffs did not serve a TCA Notice of Claim on the Association within ninety (90) days of her death.

The plaintiffs filed this wrongful death and survival action in New Jersey almost two years following her death.  The Morey defendants thereafter filed a Third Party Complaint against the Association and sought contribution and common law indemnification alleging that its negligent was a proximate cause of the  minor’s death.  The Association moved for summary judgment, invoking the TCA’s 90 day notice of claim provision.

The trial court denied the Association’s motion, finding that the TCA does not require the service of a notice of a claim as a prerequisite to a contribution or common law indemnification claim against a public entity joint tortfeaser.  The Association filed a Motion for Leave to Appeal to the Appellate Division, which was denied.  However, the Supreme Court subsequently granted the Association’s Motion for Leave to Appeal.

The plaintiffs did not name the Association as a defendant.  Neither plaintiffs, nor the Morey defendants served Notice of a Tort Claim on the Association within the ninety (90) day time period prescribed by the notice of claim provision of the Tort Claims Act.  The Morey defendants, regardless, filed a Third Party Complaint against the Association.  They claimed that the Association negligently organized, supervised, and chaperoned the field trip to the amusement park and that its negligence proximately caused the minor’s death.

In denying the Association’s Summary Judgment Motion, the trial court interpreted the notice provision to limit only a plaintiff’s right to assert a claim against a public entity.  It concluded that the pertinent provision does not require the service of a notice of a claim as a prerequisite to a defendant’s contribution or common law indemnification claims against the joint tortfeaser that is a public entity.

In previously published decisions of both the Appellate Division and the Law Division, the courts had interpreted the notice provision as inapplicable to defendants who file third party actions for contribution or common law indemnification against the public entity, despite defendant’s failure to comply with the notice requirement. The rationale was that the contribution claim was a right which does not ripen into a cause of action until the defendant has paid more than his pro rata portion of the judgment obtained against him by the plaintiff.  However, there was contrary prior Law Division published decisions, which barred claims for contribution and indemnification, if the claimant (or the defendant) failed to serve a tort claims act notice within the ninety (90) day period as set forth in the statute.

The Supreme Court decided in favor of the prior Law Division decisions, concurring in their logic that the Legislature did not distinguish between a plaintiff’s claim and a defendant’s cross-claim or third party claim against a public entity.  It did not exempt from the tort claims notice requirement a defendant’s claim for contribution and indemnification.  In short, the Court found that the statute’s meaning was clear in that it governs contribution and indemnification claims brought by defendants, as well as direct claims asserted by plaintiffs.  To hold otherwise, the Court felt that it would be undermining the Legislature’s intent “to permit public entities to properly investigate claims, correct the conditions or practices that give rise to the claim, prepare a defense, and assess the need for reserves.”

Thus, the Supreme Court held that when a defendant (or claimant) does not serve a timely notice of tort claim on a public entity, as required under N.J.S.A. 59:8-8, and is not granted leave to file a late notice of claim under N.J.S.A. 59:8-9, the TCA bars that defendant’s crossclaim or third party claim for contribution and common law indemnification against a public entity.

Next, the Supreme Court had to decide what would be the consequences as to the defendant if it could not pursue the public entity in a third party claim for contribution and indemnification.  It noted that the defendant may not even be aware of a potential contribution claim within the ninety (90) day time period.

Ordinarily, a defendant compelled to pay more than the percentage of damages corresponding to the jury’s allocation of fault would have a remedy under the Comparative Negligence Act for a claim for contribution against other joint tortfeasers.  The Supreme Court cited two cases which have held in several settings that even if the claims against the defendant are dismissed by virtue of the operation of a statute, apportionment of fault to that defendant is required by law.  Permitting the allocation of a percentage of fault to a joint tortfeaser that is not a defendant at trial “may afford to a remaining defendant the practical benefit of the contribution claim to which it is entitled under the Comparative Negligence Act and the joint tortfeaser’s contribution law.”   Thus, the Supreme Court ruled that the Morey defendants may nevertheless seek an allocation at fault as an equitable result under the circumstances.

Next, the court considered the Morey defendants’ argument that “if plaintiffs prevail at trial and the trial court molds the judgment. . ., the court should limit the Morey defendants’ liability for damages to any percentage of fault that the jury apportions to them, whether or not that percentage meets the sixty percent (60%) threshold.” Here, if a jury were to allocate sixty percent (60%) or more of the fault, but less than one hundred percent (100%) to the Morey defendants, and the Morey defendants were required to pay one hundred percent (100%) of the damages, they would be denied the benefit of their contribution claim.  Thus, the Court ruled that if the Morey defendants present evidence that the Association was negligent and that its negligence was a proximate cause of the minor’s death, the jury should be instructed to determine whether the Morey defendants have met their burden of proof on these issues.  If so, the jury would allocate negligence between the Morey defendants and the Association.  If the jury allocates a percentage of fault to the Association, the Court held that the trial court should mold the judgment to reduce the Morey defendants’ liability to plaintiffs in accordance with the percentage of fault allocated to the Association.

The Supreme Court reminded all litigants that if they intended to pursue a claim against a public entity or employee subject to the Tort Claims Act, they must act expeditiously to preserve that claim by serving notice within ninety (90) days of the accrual of the claim or filing an application within one year of that date for leave to serve a late notice of claim on a showing of “extraordinary circumstances.”  A plaintiff that is aware of a potential cause of action against a public entity and litigates the case in a manner that deprives the defendant of an opportunity to serve a Tort Claims Act Notice on that entity, risks a reduction in any damage award by virtue of an allocation of fault under the Comparative Negligence and Joint Tortfeasers Contribution Law.  However, a defendant that is aware of its potential cross claim against a public entity that may be a joint tortfeasor, but fails to serve a Tort Claims Act notice on that entity, may lose the benefit of an allocation of fault to the public entity in accordance with those statutes.

This decision will be very helpful in defending public entities who are brought in on a third party basis for contribution and indemnification.  Up until now, the trial courts were following the case law that would not bar such a claim.  With this Supreme Court decision, it provides a powerful tool to public entity defendants to obtain a dismissal as to any such claims if a timely notice of tort claim was not filed – by either the plaintiff or the defendant.

Defense Doctor Permitted to Testify as to Lack of Necessity of Plaintiff’s Surgical Procedures Despite Failing to Include that Opinion in his Report

Plaintiff Silvano Collado was rear-ended by defendant Eli Salzman while driving a min-commuter bus in Jersey City, New Jersey. Defendant stipulated to liability and the matter proceeded to a damages only trial. In Collado v. Salzmann, 2017 N.J. Super. Unpub. LEXIS 2144 (App. Div. Aug. 22, 2017), the plaintiff appealed the no cause entered against him on the basis that the defense orthopedist was permitted to testify that the plaintiff underwent two unnecessary surgical procedures, despite not including that opinion in one of his reports.

The plaintiff was subject to the verbal threshold in his insurance policy, which required him to prove that he suffered “a permanent injury within a reasonable degree of medical probability.” At trial, the defense orthopedist, Dr. Thomas Helbig, testified that plaintiff suffered only soft tissue sprains and strains in connection with the accident. Further, he testified that 2 surgical procedures performed on plaintiff were unnecessary. The jury found in defendant’s favor, finding that plaintiff had not suffered a permanent injury related to the accident.

The plaintiff appealed, arguing that the trial court abused her discretion in permitting Dr. Helbig to opine that the plaintiff’s surgeries were unnecessary. Plaintiff argued that this testimony went beyond the four corners of the pre-trial reports prepared by Dr. Helbig. Plaintiff asserted that this trial error required the appeals court to vacate the jury’s verdict and remand for a new trial. The Appellate Division, however, rejected this argument and affirmed the jury verdict.

Dr. Helbig had opined in his pre-trial reports that the plaintiff suffered only sprains and strains as a result of the accident and the trial judge found that the doctor’s opinion as to the necessity of plaintiff’s surgeries was “merely the logical extension of these reports.” Further, Dr. Helbig had previously made clear that the plaintiff’s MRIs he reviewed showed injuries that were degenerative in nature and unrelated to trauma.

The Appellate Division noted that a trial court’s admission of expert testimony is “entitled to deference absent a showing of an abuse of discretion.” Further, an abuse of discretion arises “on demonstration of manifest error or injustice.”

The court may exclude expert testimony that deviates from the pretrial report if the court finds the presence of surprise and prejudice to the objecting party. In determining if the trial court judge abused her discretion in permitting the defense doctor to testify as to the need of plaintiff’s surgeries, the Appellate Division considered whether there was: “(1) an absence of a design to mislead; (2) an absence of the element of surprise; and (3) an absence of prejudice.” Because the trial judge concluded that plaintiff’s counsel was not surprised, misled, or prejudiced by Dr. Helbig’s opinion, the Appellate Division concluded that that trial judge did not abuse her discretion in permitting the testimony.

Personal Injury Suit Remanded Back to State Court Due to Failure to Meet Monetary Threshold for Federal Diversity Jurisdiction

Plaintiff Maria Nalbone, age 87 years old, fell in her room in the Mirage Casino in Las Vegas. She injured one of her ribs due to the fall. In Nalbone v. The Mirage Casino-Hotel, 2017 U.S. Dist. LEXIS 117463 (D.N.J. July 25, 2017), plaintiff argued that the matter did not meet the threshold value of $75,000 for federal court diversity jurisdiction and, thus, it should be remanded back to New Jersey state court.

Plaintiff resided in New Jersey and the defendant The Mirage Casino Hotel was a limited liability company of Nevada. Thus, in theory, the case would have qualified for federal diversity jurisdiction (because the plaintiff and defendant are citizens of different states), as long as the value of the matter in dispute exceeded $75,000.

Plaintiff fell on water on the bathroom floor of her hotel room. Her physicians in Las Vegas determined that she bruised a rib, but did not recommend any further treatment. When plaintiff returned to New Jersey, she still had pain and went to her primary care physician. She had her rib x-rayed and it was found that her eleventh rib was fractured, but no further treatment was required. Her physician discharged her.

Her attorney sent a settlement demand to the defendant for $75,000 – which would be one cent below the diversity threshold (because the value of the claim must exceed $75,000).

The lawsuit was originally filed in New Jersey state court but the defendant removed the matter to federal court based upon diversity jurisdiction. The plaintiff thereafter filed this motion to remand the matter back to state court on the basis that the case did not meet the monetary threshold required for diversity jurisdiction.

Based upon federal law, the case is subject to being remanded if, from the face of the pleadings, the Court is satisfied to a legal certainty that the plaintiff cannot recover more than the jurisdictional amount of $75,000. In applying this standard, the Court reviewed the complaint, which alleged negligence and sought compensatory damages, costs and legal fees. There was no claim for punitive damages, no lost wages, no hospitalization, and legal fees are not ordinarily awarded in a personal injury suit in New Jersey.

The Court noted that, to a reasonable practitioner and to the Court, the value of the case would not exceed $30,000. Even if one factored in sympathy for the aged plaintiff and the “deep pocket” of the defendant, it would not raise the value about $75,000. Although the plaintiff’s demand was $75,000, the defendant had the burden of proof to establish the value of the claim, which had not been met in this case. Thus, the Court granted the plaintiff’s motion to remand the case back to state court.

When it Comes to Diagnostic Testing, Be Careful of the Company You Keep

The U.S. Attorney’s Office for the District of New Jersey reorganized its health care practice in 2010 and created a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since then, that office has recovered more than $1.36 billion in health care and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act, and other statutes.  Many of its enforcement actions have involved diagnostic testing companies and their arrangements with physicians.

In two recent cases, the U.S. Attorney settled with cardiac monitoring companies.  One company agreed to pay more than $13.4 million for steering physician clients to order higher levels of service than medically necessary. In another case, the cardiac monitoring company had entered into “fee-for-service” or “direct-bill” agreements with certain hospital and physician clinic customers that allowed the customers to bill Medicare and retain the reimbursement, which exceeded the fee that the company charged them. These agreements resulted in a net profit to the customers who submitted claims to Medicare in accordance with the agreements, primarily for services that the company—and not the customers—performed. That company paid more than $1.35 million to settle the allegation that the remuneration under these agreements was to induce referrals from their customers for non-Medicare business.

In cases like these, there is always another shoe that drops, and that would be the physician’s shoe. This was the case with the Biodiagnostic Laboratory Services (BLS) matter which involved physicians accepting bribes and kickbacks in exchange for test referrals to BLS. In June 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.  Since then, the investigation has resulted in 45 guilty pleas – 31 of them from doctors – in connection with the bribery scheme. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case. The investigation has to date recovered more than $12 million through forfeiture.

Similarly, in Texas, One Step Diagnostic agreed to pay $1.2 million in 2014, to settle allegations that it violated the Stark Statute and the False Claims Act by entering into sham consulting and medical director agreements with physicians who referred patients to One Step Diagnostic Centers. Thereafter, in 2016, at least four physicians entered into settlements to resolve anti-kickback allegations surrounding the same medical director agreements.

The message here is that diagnostic testing companies are always on the government’s radar screen, and that surveillance eventually includes the physicians who do business with them.  While diagnostic testing companies can bring valuable services to a physician practice, even legitimate arrangements can place the physician in jeopardy if the company, the services, or the agreement don’t meet applicable rules.  The physician must assess whether the company it plans to partner with is operating in accordance with laws regarding licensure, personnel, referrals and billing.  In New Jersey, rules governing diagnostic testing services performed in a physician’s office impose additional requirements on the practice. Physicians should consult with experienced legal counsel to vet any diagnostic testing arrangement under both federal and state law before signing a services or billing agreement or receiving any compensation from a consulting or medical director arrangement.

Questions regarding this article may be sent to Publications@Capehart.com.

New Jersey Court Permits Service of Process through Facebook

If a plaintiff is unable to serve a complaint through personal service and is unable to locate a valid address for the defendant, what alternative means of service are available to plaintiff? That was the issue faced by plaintiffs in K.A. v. J.L., 450 N.J. Super. 247 (Ch. Div. 2016). In a published decision, approved for publication in May 2017, the Chancery Division in Essex County permitted service via Facebook.

Plaintiffs started this lawsuit to obtain an injunction to bar defendant from holding himself out as their son’s biologic father, contacting them and their son, and to compel him to remove information published about the minor online. Defendant claimed he was the child’s biological father. Plaintiffs K.A. and K.I.A. were the minor’s (Z.A.) adoptive parents and the biologic father of record was J.P. (The court used initials to protect the child’s identity.)

Defendant was a complete stranger to plaintiffs. He reached out to plaintiff K.A. through Facebook but K.A. denied his friend request. He then contacted the minor Z.A.  through Instagram, identifying himself as his biologic father, disclosing the identity of his birth mother and that he had biological siblings. He also tried to reach Z.A.’s sister through Facebook.

The plaintiffs retained counsel who sent the defendant cease and desist letters by regular and certified mail at his two last known addresses in Pennsylvania. The regular mail letter was not returned but the certified mail letters came back as undeliverable as addressed. In light of the inability to serve defendant by mail, the plaintiffs applied for an order to effectuate substituted service of process through Facebook.

As a preliminary matter, the court had to determine whether New Jersey was able to assert personal jurisdiction over the defendant. The court found that the defendant’s contacts in reaching out to various New Jersey residents was sufficient to confer specific jurisdiction over the defendant.

However, service of process must be effected as an additional requirement for personal jurisdiction. Per New Jersey’s court rules, a plaintiff must serve the complaint on the defendant personally. If the plaintiff is unable to serve the defendant personally, there are secondary methods available (such as by mail or publication). As a last resort, the court rules permit service as set forth in a court order, consistent with due process.

Here the plaintiff was unable to secure a good address, precluding service personally or by mail. The court found that “Given that the Facebook and Instagram addresses at issue are the sole conduits of the purported harm, service via Facebook is reasonably calculated to apprise the account holder of the pendency of this action and afford him or her an opportunity to defend against plaintiff’s claims.” The defendant’s recent activity on Facebook indicated that the account was active and that the receipt of the documents was probable. Also the court was satisfied that the Facebook account belonged to the defendant. Thus, the court found that service through Facebook met the due process requirement and permitted service of the complaint to be effected in this manner.

Plaintiff’s Bodily Injury Claim Due to Fall from Water on Floor Dismissed

Plaintiff Cameron Smith was shopping at defendant Walmart’s store at 9:45 pm when she slipped and fell on water inside the store. She landed on her right hip, sustaining injuries. In Smith v. Walmart Stores, Inc., 2017 N.J. Super. Unpub. LEXIS 1964 (App. Div. July 31, 2017), she claimed the defendant store failed to exercise reasonable care in inspecting the premises.

Plaintiff testified that it had rained earlier in the day and that, as she entered the store, she noticed eight to ten buckets placed to catch dripping rainwater near the entrance. Smith fell about 20 feet from the entrance and theorized that customers entering the store may have “transferred” that water to the area where she fell.

Plaintiff had submitted an expert report from an engineer who concluded that the wetness on the floor at the time of her accident “was an unsafe condition and defendant’s failure to mitigate the wetness was the cause of plaintiff’s injury.” The trial judge found no evidence to support that the water came from these rainwater buckets and granted the motion to dismiss the complaint.

On a motion for reconsideration, the plaintiff submitted a second expert report from a “retail industry consultant” who opined that the maintenance procedures of the store, requiring hourly “sweeps,” did not change during inclement weather. Thus, the expert concluded the water where plaintiff fell was there long enough where it should have been detected.

While the trial court refused to consider this new report on a motion for reconsideration, even if he were to consider it, the judge found it to be a “blatantly net opinion.” The plaintiff’s counsel also raised the mode of operation doctrine for the first time during the oral argument on the motion for reconsideration. The judge also rejected that argument, finding that it did not apply based upon these facts.

The Appellate Division upheld the trial court’s dismissal of this matter. It found that the trial court properly excluded the second expert report. As for the mode of operation doctrine, the Appellate Division agreed that it was inapplicable to the facts of the case.

The Importance of Supervisor Training

Time and time again, employment law attorneys remind their clients of the importance of making sure your supervisors are trained to supervise properly.  Supervisors not only need to be continuously trained in how to properly interact with their subordinates and deal with disciplinary issues, but also on their roles in the application of the company’s employment manual, particularly (although not exclusively) the discrimination and harassment policies.  Many times, a lack of training leads to a supervisor’s failure to identify an issue that should be reported to human resources for proper handling.  Unfortunately, this often leads to costly litigation for the company.

On June 13, 2017, the United States District Court for the District of New Jersey issued an opinion in Yeager v. Covenant Sec. Servs., 2017 U.S. Dist. LEXIS 90243 (Jun. 13, 2017) on a summary judgment motion filed by the Defendant.  The Plaintiff, David Yeager, filed a complaint alleging that he was terminated unlawfully and in retaliation for his support of a former co-worker’s unlawful termination lawsuit against the Defendant, Covenant Security Services, Ltd.

Plaintiff was initially hired in 2011 as a security officer in August 2011.  In October 2011, Plaintiff was promoted to the position of site manager.  Plaintiff received and signed an acknowledgement form for the Company’s Employee Handbook.  The Handbook expressly allowed for complaints of discrimination or harassment to be made to supervisors, but also required supervisors to fill out a “Preliminary Complaint” form and immediately forward the form to human resources.  The Handbook specifically notes that the supervisor does not investigate the complaint.

While Plaintiff was a supervisor, a subordinate (Wadleigh) reported that she was being sexually harassed by another employee, Tucker.  Although Plaintiff filled out the Preliminary Complaint form and had the employee sign it, he noted “no witness need proof” and did not forward the document to human resources.  The next day the subordinate reported a second instance of sexual harassment and again, Plaintiff filled out the Preliminary Complaint form and had the employee sign it.  He again noted “no witness need proof” and did not forward the document to human resources.  A few weeks later, the same subordinate reported a third instance of sexual harassment by the same employee.  Plaintiff once again filled out the Preliminary Complaint form and had the employee sign it.  This time Plaintiff indicted, No witness/need someone Goffney complaint went nowhere.  problem!”  Plaintiff once again failed to forward the document to human resources.  Another two weeks passed and the subordinate reported a fourth incident of sexual harassment.  Plaintiff once again documented the complaint.  He also noted “will set up camera in command center.  But only have her word against his, problem.”  Again, Plaintiff did not forward the document to human resources.

Subsequently, the subordinate who had been reporting sexual harassment claims to Plaintiff was terminated during a June 27, 2013 meeting for poor performance and behavioral issues.  Plaintiff had not yet provided copies of the Preliminary Complaint forms to human resources, but notified an Operation Specialist that the subordinate had complaints.  Plaintiff told the subordinate to bring her written complaints to the meeting, yet she never informed anyone else of the sexual harassment claims at the June 27, 2013 meeting.  Also on June 27, 2013, Plaintiff witnessed Tucker make a racial slur about an individual.  Plaintiff filled out the Preliminary Complaint form and immediately forwarded it to human resources.  Tucker was terminated the following day.  On July 1, 2013, Plaintiff finally reported to human resources that he had documented several complaints from Wadleigh regarding sexual harassment.

In December 2013, Wadleigh filed a complaint pursuant to the New Jersey Law Against Discrimination alleging sexual harassment, retaliation and wrongful termination.  Subsequently as part of the discovery process in this matter, Plaintiff was interviewed and admitted that he did not immediately report Wadleigh’s complaints, and according to the notes from the meeting, he conceded that he did not follow the employment policies.  In a subsequent meeting, Plaintiff alleges he told his employers that he did not report Wadleigh’s complaints because in his experience, Covenant did not properly handle sexual harassment complaints if there was no proof of corroboration.  Plaintiff was thereafter fired for “violation of Covenant’s policy and procedures and failure to report sexual harassment.”  Plaintiff then filed a retaliation and wrongful termination claim pursuant to the New Jersey Law Against Discrimination.

The results of this case are irrelevant.  The takeaway is that a supervisor’s failure to follow procedures can lead to costly and time consuming litigation (and a possible judgment or settlement).  In this case, it led to two separate lawsuits from one supervisor’s failure to follow the Company’s policies.  Even if the employer succeeds in the end and is able to show no wrongdoing, the employer won’t get back the cost, time and work put into defending the litigation.  Even if you have Employment Practices Liability Insurance to cover some or all of the litigation costs, a lawsuit will likely lead to higher premiums.  Ensuring your staff is properly trained on policies and procedures on a regular basis is essential.  It may be an upfront cost, but in the long run, it could save your company thousands of dollars and employee hours defending a lawsuit.

New Jersey Supreme Court Rejects Summary Judgment for Hospital in Terminating Disabled Employee

Workers’ compensation claims often lead to complex disability discrimination law suits, and the recent New Jersey Supreme Court case of Grande v. Saint Clare’s Health System (A-67-15) (July 12, 2017) provides a good example of this.   The case concerned the termination of a registered nurse by the hospital following a series of work-related injuries involving the nurse.

Maryanne Grande was employed by St. Clare’s from 2000 to July 2010.  Her job tending to stroke victims involved maintaining charts, administering medications, providing general care, assisting patients with daily living activities such as washing, bathing, dressing, walking, repositioning patients in bed, and guarding them against falls.

In August 2008, St. Clare’s performed a job system analysis for various nursing positions, resulting in a description of the frequency that nurses performed certain tasks.  In the year prior to the job analysis, Grande injured her left shoulder while repositioning a patient in bed.  This led to surgery with a three month recovery period at home before returning on a light-duty basis, followed by full duty status in a month.

In May 2008, Grande was repositioning a patient in bed and felt pain in her right shoulder this time.  An MRI showed no serious abnormality.   But in November 2008, Grande reinjured her left shoulder again while lifting the legs of a 300-pound patient.  She underwent a second surgery and returned to full duty approximately six months after the accident.

In February 2010, Grande was caring for an overweight patient.  The patient began to fall, and Grande grabbed the patient’s shoulders from behind, injuring her neck.  She had surgery on her neck and was out of work four months.  On her first day back to work, she left after four hours due to pain.  Two weeks later she returned to full-time, light-duty work.

In early July 2010, Grande’s physician, Dr. Joel Spielman, cleared her to return to full-duty work, but the hospital required her to attend an FCE.  The FCE professionals understood that her job required her to push, pull and lift from waist to chest frequently (34-66% of the time).  She was able to perform these functions occasionally (1-33% of the time).  The report documented “mild residual functional issues” but concluded that “it is improbable that this will significantly affect job performance ability.” Given the recent neck surgery, the FCE report suggested that Grande be permitted changes in activities during periods of prolonged or repetitive neck movements.  Finally, the report suggested that Grande “seek appropriate assistance with heavier physical activities such as patient transfers, guarding ambulatory patients or handling loads” greater than 50 pounds.  She was cleared for medium category work (occasional lift and work up to 50 pounds).  The FCE report also deferred to Grande’s treating physician, Dr. Spielman.

Dr. Spielman took contradictory positions in the case.  As noted above, his first note approved full-duty return to work before any FCE was done.  On July 21, 2010, following the FCE, Dr. Spielman approved Grande to return to work with restrictions as outlined in the FCE.  He advised that Grande needed permanent restrictions of lifting up to 50 pounds occasionally and should transfer patients with assistance only.

The hospital proceeded to terminate Grande’s employment because the hospital concluded that she could not perform the essential functions safely.  Grande then saw Dr. Spielman again, and this time Dr. Spielman pivoted back to his original note, stating that Grande had no restrictions any longer.  St. Clare’s had already terminated Grande and refused to rehire her.  The Court ignored Dr. Spielman’s last note because it was issued after Grande had been fired.

Grande sued alleging discrimination based on disability under the New Jersey Law Against Discrimination.  The trial court granted St. Clare’s motion for summary judgement.   A divided Appellate Division panel reversed.  The New Jersey Supreme Court ultimately agreed with the Appellate Division.  The Court examined the two main reasons that the hospital terminated Grande.  First, the hospital argued that Grande had chronic and excessive absenteeism.  In the prior three years, Grande had been out of work for about a year.  But the Supreme Court noted that there were issues of fact whether Grande’s absences were sufficiently “chronic and excessive.”

The second reason advanced by St. Clare’s was that the FCE supported its position that Grande could not safely perform the essential job functions.  The Court rejected this as well, stating that there was no consistent understanding of the essential job functions.  The 2008 St. Clare’s Job Analysis showed that RNs must lift fifty pounds from waist to chest frequently (34% to 66% of the day).  It also reflected that there was no activity that is performed at a frequency greater than 66% of the time.

The Court examined the FCE results carefully. It became apparent to the Court that there was an inconsistency between the 2008 Job Analysis and the testing standards of the FCE.  The 2008 Job Analysis required lifting 50 pounds from waist to chest frequently. The FCE understood that a nurse must lift 20 pounds constantly, 67% to 100% of the time.   There was no requirement for constant lifting in the Job Analysis.  Additionally, the FCE understood that there was an occasional requirement of lifting of up to 100 pounds, which did not appear in the Job Analysis at all.  In essence, the FCE assumed almost constant lifting, and sometimes at much higher weights, than the 2008 Job Analysis.  The FCE referred to a job analysis received from the hospital, but it did not appear to be the 2008 Job Analysis.  For her part, Grande said both the 2008 Job Analysis and the FCE criteria were wrong:  she contended that the actual physical aspects of her job were less onerous and that she could do the job.

The Supreme Court also noted that the FCE cautioned that the results “may be compatible with mild residual functional issues,” but “it is improbable that this will significantly affect job performance ability.”  This language did not support the termination of Grande at all.  The FCE deferred to Dr. Spielman, who wrote his second report incorporating the conclusions of the FCE.  In essence, Dr. Spielman embraced the FCE recommendations.

Finally, the Court noted that the hospital was concerned about Grande’s potential to injure patients.  She had never actually injured any patient when she was injured on the job previously, and the FCE report only recommended that Grande be assisted in lifting more than 50 pounds, notwithstanding that she was able to lift over 100 pounds during testing.  St. Clare’s produced no expert indicating that there was a material risk of harm to herself or patients if she returned to work.

The Supreme Court affirmed the dismissal of summary judgment for the hospital and remanded the case for trial.  The case is of great importance because the use of FCEs is widespread in New Jersey in helping employers determine whether to return employees to work following work injuries or non-work medical conditions.  The issue in this case arises quite often, namely a disagreement over the essential job functions.  In this case the hospital did have a good job analysis, but somehow that requirements in the 2008 Job Analysis did not coincide with the requirements of the FCE.  Further, the hospital seemed to have reached too far in concluding from the FCE that the employee could not do her job.

What should employers and FCE companies do when an employee disagrees with the essential functions?  One idea is to have a document that clearly records the essential functions which has been signed off by the employer and the employee.  Getting all parties on the same page would eliminate the main objection in countless situations over what is and what is not an essential job function.  FCEs are extremely helpful because they provide scientific data on what an employee can physically do, but if the test does not replicate the job duties, then the test if invalid.  More time should be put into confirming the essential functions and then confirming with the employee that he or she agrees with those functions.  Creating a sound list of essential functions is critical, and there are companies who can visit work sites and document the essential functions.

Appellate Division Finds Employee Status, Not Casual Employee Or Independent Contractor Status

Michael Savio was injured on a job site on June 1, 2006.  He stated that he worked for Matthew Giambri for four weeks on two job sites, pouring concrete on one site, and doing plumbing work on the other site.  Giambri paid him $150 per day to pour concrete; otherwise, he paid him $100 to $125 per day.

On the day of the accident, Giambri picked up Savio from his home and drove him to a job site.  His job that day was to tear off siding on a home.  Savio testified that Giambri pointed out what he had to do and then left.  He said he had his own tools but there was no evidence that he used them on the job site.  He brought no materials with him as everything he needed was there.

After Savio removed the siding, he descended from a ladder which broke, causing Savio to fall two-and-a-half stories and injure his spine.  He treated for four years for the injury and was never able to resume construction work.  Petitioner filed a petition asserting that he was employed by Giambri, and his employer asserted that he was an independent contractor or a casual employee and therefore not protected by workers’ compensation laws.

The Judge of Compensation and the Appellate Division found that petitioner was an employee.  The opinion of the Appellate Division is interesting because the court reviewed 12 factors outlined in the case of Estate of Kotsovska, ex rel. Kotsovska v. Liebman, 221 N.J. 568 (2015).

  • The first factor is the employer’s right to control the means and manner of work performance. The court found that there was evidence that Giambri provided instruction in what to do and how to remove the siding, as well as materials to do the job. The court felt it insignificant that Giambri left the work site while the siding was removed. The court also said that the “control” factor carries less weight than other factors;
  • The court felt that the second and third factors had minimal significance in this case. They involve supervision necessary over the job and skills to perform the job.  The court agreed with the Judge of Compensation that Savio had the skills and required little direction;
  • The fourth factor pertains to who furnishes equipment, and this was clearly in Savio’s favor;
  • The fifth factor involves the length of time a worker performs duties for the alleged employer. In this case the court felt that four weeks was sufficient.
  • The sixth factor relates to the method used to pay the alleged employee. Here Savio was paid by cash or personal check, and Gambri gave him a W-2 form at the end of the year.  This also favored employment;
  • The seventh factor focuses on the manner in which the work relationship terminated. In this case the petitioner could not return to work because of his injury.
  • The eighth, tenth, and eleventh factors pertain to benefits: annual leave, retirement benefits, and payment of Social Security taxes.  There was no evidence in this case regarding these factors.
  • The ninth factor focuses on whether the alleged employee’s work is an integral part of the employer’s business. “Here, the judge found Giambri was a contractor who employed laborers to perform services on his behalf and, thus, the work Savio performed was an integral part of Giambri’s business.”
  • Lastly, the twelfth factor examines the intentions of the parties. The Appellate Division believed that there was a relationship consistent with an employer and employee, even if there was no documentation expressing intention.

The Appellate Division felt that the vast majority of these factors favored employment status and affirmed the decision of the Judge of Compensation.  The case is very helpful in resolving disputes of this nature by providing a framework to analyze similar situations.   It can be found at Savio v. Giambri, A-0701-15T1 (App. Div. July 12, 2017).

Court Finds Homeowners Not Liable to Guest Who Trips over Dog in Hallway

Homeowners Richard Compeau and Rosanna DiMarzio found out the hard way what happens when you “let sleeping dogs lie” (or in their case one sleeping dog) in their hallway, when a guest at their Christmas dinner tripped over their dog and was injured. In Parella v. Compeau, 2017 N.J. Super. Unpub. LEXIS  1622 (App. Div. July 5, 2017), plaintiff Jennifer Parella sued defendants Compeau and DiMarzio, alleging that they breached their duty of care to her by failing to warn her of a dangerous condition in their home, i.e., a dog sleeping in the hallway adjacent to the doorway of the dining room where she was eating dinner.

Plaintiff was one of 20 guests at the defendants’ Christmas dinner. After finishing the second course, the plaintiff got up from the table to put her dish in the kitchen sink and check on her child who was in adjoining room. Plaintiff had to walk to the end of the table and squeeze past defendant DiMarzio to reach the hallway, on her way to the adjoining room. As she cleared DiMarzio’s chair, she turned right to enter the hallway toward the kitchen and fell over a large dog lying in the hallway.

Plaintiff landed with her legs draped over the dog’s body. She did know the dog had been there because she stepped over him to enter the dining room and take her seat. She had been holding a wineglass, which broke, cutting her finger. About 2 weeks after the fall, she was treated by a hand specialist to address her continued pain and swelling in her finger. As it turns out, there was glass remaining in her finger, which had to be surgically removed. Plaintiff found out from her surgery that she had severed a tendon. She suffered radiating pain down her arm.

As a social guest, the defendants owed the plaintiff a duty only to warn “of dangerous conditions of which [the host] had actual knowledge and of which the guest is unaware.” A social host has no duty to inspect the premises to discover defects which otherwise might not be visible. If a guest is aware of the dangerous condition or “by a reasonable use of his [faculties] would observe it,” the host would not be liable. The plaintiff claimed that the defendants knew that allowing a dog to lie in front of a doorway posed a tripping hazard and failed to warn the plaintiff of this “known hazard” or eliminate the “danger.”

On the other hand, the defendants argued that the dog’s presence was known to the plaintiff and that she knew there were two dogs in the house and could reasonably anticipate he was lying in the home. Further, the dog was not a dangerous condition and both the size of the dog, as well as his location in the hallway, made him easily seen.

The Appellate Division noted that the facts showed that the dog was not hidden from view. The hallway was well lit. Others walking into the dining room from the hallway saw the dog. Further, the plaintiff’s injuries were not caused by the dog’s actions in causing her to trip and fall. Based upon the photographs of the dog, the Court found that he would have been clearly visible to anyone who was watching where he or she was walking.

Finally, the court held that the mere presence of a dog sleeping in the hallway did not create an unreasonable risk or a dangerous condition, triggering defendants’ legal duty to warn guests walking in their home. Thus, the Appellate Division upheld the summary judgment granted in favor of the defendants, dismissing the case.

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