Significant New Jersey Liability Litigation Cases December 2013 – May 2014

By: Betsy G. Ramos, Esq. & Charles F. Holmgren, Esq.

AppealsSessner v. Merck Sharp & Dohme Corp., 2014 N.J. Super. LEXIS (App. Div. April 23, 2014). On the eve of the issuance of a comprehensive opinion on the issues raised on appeal, the respondent’s counsel advised the court that a settlement had been reached. The court later learned it had been reached 4 months previously but that counsel had failed to notify the court. The Appellate Division publicly chastised counsel and considered imposing sanctions against them for wasting the judicial resources of the court.

Civil Procedure (ex parte request for default judgment)Midland Funding LLC v. Albern, 433 N.J. Super. 494 (App. Div. 2013). Plaintiff filed a complaint to which the defendant filed a motion to dismiss. The defendant never filed an answer. The plaintiff’s subsequent ex parte request for default from the court’s clerk was procedurally improper because the motion to dismiss was evidence of the defendant’s defense of the action. Thus, the defendant was entitled to notice before a default could be entered.

Condominiums (standing to file suit)Port Liberte II Condo. Assoc. v. New Liberty Residential Urban Renewal Co., LLC, 435 N.J. Super. 51 (App. Div. 2014). In a suit against builders for various construction defects to a condominium association’s property, the condominium association’s failure to get the pre-approval of its unit owners, as required by the association’s by-laws, did not present grounds for the builders to argue the association had no standing. A subsequent vote of the unit owners permitted the association to ratify the suit.

ContributionCherilus v. Federal Express, 87 A.3d 269 (App. Div. 2014).  The defendant attempted to pursue a contribution claim against a co-defendant after the case was settled with the defendant and dismissed by stipulation of dismissal. Because there was no payment of settlement money to the plaintiff, the court found that there was no viable claim for contribution against the co-defendant.

Insurance (duty to defend an excess insurance policy)Johnson v. Plasser Amer. Corp., 2014 N.J. Super. Unpub. LEXIS 372 (App. Div. February 26, 2014). An attorney sought his fees from an excess insurance policy for representing the insured. The court held the excess insurer was not required to contribute to the defense of the insured as long as the primary insurer is required to defend; only the exhaustion of the underlying carrier’s coverage limits would trigger the excess carrier’s obligation.

Insurance (exclusions)Weaver v. Nat’l Gen. Ins. Co., 2014 N.J. Super. Unpub. LEXIS 96 (App. Div. January 16, 2014). An individual injured in an Italy auto accident could not recover under her household’s automobile insurance policy because the geographic coverage area in the unambiguous language of the policy’s General Provisions clearly set forth the coverage area. The PIP and UM endorsements only altered the policy to the extent of the language in the endorsements, which did not include an element specific to the territorial coverage area.

JurisdictionBaanyan Software Services, Inc. v. Kuncha, 433 N.J. Super. 466 (App. Div. 2013).  Plaintiff employer attempted to sue its Illinois based employee for breach of contract in New Jersey. The court found that the employee lacked the minimum contacts with New Jersey to be subject to suit in this state and dismissed the suit based upon the lack of jurisdiction.

Legal Malpractice (duty owed to an adverse party)Innes v. Marzano-Lesnevich, 87 A.3d 775 (App. Div. 2014). The plaintiff-father sued the defendant-law firm, which represented his former wife, for permitting her access to their daughter’s passport in breach of an agreement not to do so. The court held that an attorney has a duty to a non-client where the attorney had a reason to foresee the specific harm which could occur, and, here, it was foreseeable if the mother obtained the daughter’s passport she would take her overseas.

Medical Malpractice (rescission)DeMarco v. Stoddard, 434 N.J. Super. 352 (App. Div. 2014).  JUA of Rhode Island rescinded the malpractice policy issued to Dr. Stoddard due to his misrepresentation of the nature and location of his practice. Despite false information in his application for insurance and renewals, the court found that the carrier was required to provide coverage for the minimum amount required by NJ law.

Medical Malpractice (statutory duty to report suspected child abuse)L.A. v. D.Y.F.S., 2014 N.J. LEXIS 458 (April 23, 2014). Under the circumstances, the information available to a doctor and hospital staff who treated a child for the ingestion of a household cosmetic, without more, was insufficient to find the doctor and his staff behaved unreasonably in failing to report an incident of suspected abuse. Subsequent evidence of abuse and a D.Y.F.S. investigation cannot influence the circumstances the doctor and his staff faced.

Negligence (duty of private utility company)McGlynn v. State of New Jersey, 434 N.J. Super. 23 (App. Div. 2014).  The court considered whether a private utility company could be held responsible for the death of the plaintiff which was caused by a tree falling on the plaintiff’s car as it passed by. The tree was located within the utility’s right of way. The court found that the utility company had no duty of care to maintain vegetation within its right of way for the benefit of passing motorists.

Negligence (mode of operation)Prioleau v. Kentucky Fried Chicken, Inc., 434 N.J. Super. 558 (App. Div. 2014).  Plaintiff fell on water/grease at a KFC. The trial judge charged the jury with the mode of operation rule. The Appellate Division found that it was error to charge this rule just because KFC was a fast food restaurant. To merit this charge, there must be causal link between the manner in which the business conducted its business and the alleged hazard.

Offer of Judgment (attorneys fees) Feliciano v. Faldetta, 434 N.J. Super. 543 (App. Div. 2014).  The court found that the defendant was not entitled to any reduction in the attorneys fee award for the contingent fee to be paid to the plaintiff. However, it also denied the application of the plaintiff’s attorney for a fee enhancement.

PIPArtwell v. Sea Scape Landscaping, LLC, 2014 N.J. Super. Unpub. LEXIS (App. Div. March 27, 2014).  PIP carrier failed to seek reimbursement from another insurance carrier for PIP benefits paid pursuant to N.J.S.A. 39:6A-9.1 within 2 years of its insured’s filing of a claim. The court found that although it filed a cross-claim against the other carrier, because the cross-claim was filed after the 2 year time period, neither the principle of “relation back” or equitable tolling of the limitations period applied and the claim was barred.

Products Liability (duty to warn)Hughes v. A.W. Chesterton Co., 2014 N.J. Super. LEXIS 54 (App. Div. April 23, 2014).  Court considered whether a manufacturer had a duty to warn that component parts, which will be regularly replaced as part of routine maintenance, contained asbestos. The court determined that such a duty should be imposed. However, the plaintiff was unable to prove causation and, hence, the suit was dismissed.

Tort Claims Act (liability of school)Robinson v. Vivirito, 217 N.J. 199 (2014).  The Court considered whether a school principal and the school could be liable to a third party passing through school grounds on off hours and is bitten by a neighboring dog. The Court found that the principal had no duty to protect against the attack under the Tort Claims Act.

UM/UIM James v. NJM, 216 N.J. 552 (2014).  Court considered the retroactivity of N.J.S.A. 17:28-1.1(f) which prohibits the use of step-down provisions in an employer’s commercial motor vehicle policy to provide less UM or UIM coverage for employees than which is provided to the “named insureds” on the policy. The Court found that the law should be applied prospectively only.

Workers’ Compensation (employee status)Estate of Kotsovska v. Liebman, 433 N.J. Super. 537 (App. Div. 2013).  In this wrongful death claim, the issue to be decided by the court was whether the Law Division or the Division of Workers Compensation should decide whether the plaintiff’s decedent, a home health aide, was an employee or an independent contractor. The court found that the matter should have been transferred to the Division for this determination.

Workers’ Compensation (employer’s premises)Hersh v. Morris County, 217 N.J. 236 (2014). The plaintiff was injured while crossing a public street while walking from a private parking garage, paid for by her employer, to her employer’s premises. The plaintiff sought workers’ compensation benefits for her injuries. The Supreme Court held that because the county did not control the garage or any part of her path to the employer’s premises, her injury was not on its premises and the claim was not compensable.