The Appellate Division, First Department, recently reversed a decision which could have hindered the use of the sole-proximate cause defense to Labor Law § 240(1) claims. In McManus v. City of New York, the First Department reversed the Trial Court’s Order granting summary judgment to plaintiff on his Labor Law § 240(1) claim.
In the underlying Bronx County case, plaintiff Joseph McManus was injured on a jobsite as a result of falling into a deep concrete tank. The opening of the tank had been covered by a baker’s scaffold. Plaintiff claimed that the tank’s opening was inadequately covered and moved for summary judgment on his Labor Law § 240(1) claim. Defendant City of New York claimed that the tank’s opening was adequately covered until plaintiff moved the scaffold, and alleged that plaintiff was the sole-proximate cause of his fall.
In granting plaintiff summary judgment, the Trial Court determined that the happening of plaintiff’s accident was evidence of an inadequate safety device, thus entitling plaintiff to relief pursuant to Labor Law § 240(1). The Trial Court opined: “Whether it was the Plaintiff or someone else that moved the device, this does not take away or change the fact that the device failed to prevent the fall. Therefore, under either version, liability results under [Labor Law] §240(1), the plaintiff will be entitled to summary judgment.” The Trial Court further opined “once it is established that the safety device failed, Plaintiff cannot be found to be the sole proximate cause of the injury.”
In reaching the decision to grant plaintiff summary judgment, the Trial Court failed to analyze the adequacy of the safety device (the “baker’s scaffold”), and further failed to analyze whether plaintiff tampered with an adequate safety device. As such, defendant City of New York was preempted from fair use of the sole-proximate cause defense. If the First Department had upheld this the Trial Court’s decision, then the use of the sole-proximate cause defense may have been foreclosed under similar circumstances in future cases.
While the Legislature intended to improve workers’ safety through the enactment of the Labor Laws, it did not intend to provide recovery for injuries caused exclusively by the plaintiffs own negligence. While comparative negligence is a defense to some Labor Law causes of action, New York Courts have held that it is not a defense to Labor Law § 240(1) claims. In relation to a Labor Law § 240(1) claim, a defendant asserting the sole-proximate cause defense is saying “we took all proper safety precautions, yet the plaintiff found a way to be the exclusive cause of his or her own injuries.” If the Court agrees, there will be no recovery pursuant to Labor Law § 240(1). As such, the sole-proximate cause defense is one of the most important defenses available when a plaintiff brings a claim pursuant to Labor Law § 240(1).
Reliance on Res Ipsa Loquitur Insufficient to Prove Negligence at New Jersey Theme Park
The Appellate Division recently upheld a Law Division decision granting summary judgment for a theme park in New Jersey in which plaintiff chose not to support her allegations of various forms of negligence with an export report, but rather on theories of Res Ipsa Loquitur (Latin for “the thing speaks for itself’), and common knowledge. In Stella Bomtempo v. Six Flags Great Adventure LLC, plaintiff alleged that she sustained personal injuries as a result of riding one of the park’s new attractions at Hurricane Harbor, the “Tornado.” Plaintiff further alleged that defendant was negligent in failing to properly inspect and/or maintain the premises, amusement rides, and all components thereof.
The issue on appeal was whether summary judgment was properly granted in favor of defendant after the trial court held that plaintiff lacked the necessary expert testimony to establish defendant’s standard of care. The trial court also declined to consider plaintiff’s post-discovery affidavits (one by plaintiff and one by her husband) which asserted for the first time that upon finishing the ride, the raft they were using had deflated.
In negligence actions, plaintiffs are ordinarily not required to prove the applicable standard of care when the duty would be considered “common knowledge.” However, where common knowledge is insufficient to establish a defendant’s duty, plaintiffs must produce expert testimony regarding the appropriate standard of care and the defendant’s deviation from that standard. The Appellate Court found the record in the present case demonstrated that operation and maintenance of the attraction at issue was not common knowledge, but instead required a thorough comprehension of the attraction’s standard operating procedures, which were designed to comply with guidelines established by the American Society for Testing and Materials. As such, expert testimony was required to establish the applicable standard of care.
Plaintiff’s attempt to establish negligence under the theory of Res Ipsa Loquitur was also rejected by the Appellate Court. Res Ipsa Loquitur allows a jury to infer negligence from the very nature of an accident or injury in the absence of direct evidence on how any defendant behaved. The Appellate Court opined that negligence in the present case was not plainly evident because plaintiff cannot point to any specific malfunction which caused her injuries. The Court held that Plaintiff’s allegation that the raft skimmed off the surface of the ride without any further evidence that such an event is not supposed to occur, does not bespeak of negligence.
Florida's Cap on Attorney's Fees in Workers' Compensation Cases Ruled Facially Unconstitutional
In Marvin Castellanos v. Next Door Company, et al., the Florida Supreme Court ruled 5-2 that the mandatory fee schedule in section 440.34, Florida Statutes (2009), which eliminates the requirement of a “reasonable” attorney’s fee to the successful claimant, is facially unconstitutional. The Court held that the mandatory fee schedule in section 440.34, which creates an irrebutable presumption that precludes any consideration of whether the fee award is reasonable to compensate the attorney, is unconstitutional under both the Florida and United States Constitutions as a violation of due process.
Section 440.34(1) states, in pertinent part:
A fee, gratuity, or other consideration may not be paid for a claimant in connection with any proceedings arising under this chapter, unless approved by the judge of compensation claims or court having jurisdiction over such proceedings. Any attorney’s fee approved by a judge of compensation claims for benefits secured on behalf of a claimant must equal to 20 percent of the first $5,000 of the amount of benefits secured, 15 percent of the next $5,000 of the amount of the benefits secured, 10 percent of the remaining amount of the benefits secured to be provided during the first 10 years after the date the claim is filed, and 5 percent of the benefits secured after 10 years. The judge of compensation claims shall not approve … any … agreement related to benefits under this chapter which provides for an attorney’s fee in excess of the amount permitted by this section. (emphasis added)
In Castellanos, the claimant prevailed in his workers’ compensation claim. However, because section 440.34 limits a claimant’s ability to recover attorney’s fees to the above sliding scale based on the amount of benefits obtained, the fee awarded to Mr. Castellanos’ attorney amounted to only $1.53 per hour for 107.2 hours of work determined by the Judge of Compensation Claims to be “reasonable and necessary” in litigating the case. Castellanos had no ability to challenge the reasonableness of the $1.53 hourly rate, and both the JCC and First District were precluded by section 440.34 from assessing whether the fee award was reasonable.
In ruling that the mandatory cap is unconstitutional, the Florida Supreme Court has potentially opened the door to higher claims cost and additional litigation. Claims handlers should be wary of exponential increases in attorney’s fees going forward on Workers’ Compensation cases, and adjust reserves accordingly.
Appellate Division Upholds Broad Plan or Design Immunity in Suit Against Public Entity
The Appellate Division recently upheld a Law Division decision granting summary judgment to a New Jersey municipality, as well as its engineers and general contractor, based on plan or design immunity under the New Jersey Tort Claims Act (“TCA”). In Yulis v. Twp. of Teaneck, No. A-4016-13T4, 2016 N.J. Super. Unpub. LEXIS 1807 (App. Div. Aug. 1, 2016), plaintiff alleged that he sustained personal injuries when he tripped and fell on a mountable curb at a pedestrian plaza in Teaneck. Plaintiff further alleged that defendants were negligent in the plan or design of the mountable curb.
The issue on appeal was whether summary judgment was properly granted in favor of the defendants under the TCA. Plaintiff contended that defendants failed to meet their burden of proof that the degree of the sloped mountable curb was specifically considered and sufficiently addressed in the design plans approved by Teaneck. His expert opined that the degree of the slope was a “palpably unreasonable” dangerous condition.
Under the TCA, a public entity is insulated from liability related to the design of public property, “where such plan or design has been approved in advance of the construction or improvement by the Legislature or governing body of a public entity.” Significantly, “plan or design immunity does not depend upon any showing of the reasonableness of the design, nor can it be lost by changed circumstances.” Birchwood Lakes Colony Club v. Medford Lakes, 90 N.J. 582 (1982). Additionally, if plan or design immunity attaches to the public work, then the immunity is extended to private contractors through derivative immunity. See Rodriguez v. N.J. Sports & Exposition Authority, 193 N.J. Super. 39 (App. Div. 1983).
The Appellate Division held that summary judgment was properly granted. Discovery revealed that the mountable curb was set forth in several plans, diagrams, correspondence and hand-outs reviewed by Teaneck when it approved the project. Additionally, the Court found that there was no heightened degree of detail required of the plans to show the Teaneck contemplated, considered and approved the specific slope degree of the curb. Accordingly, Teaneck demonstrated an entitlement to summary judgment, as a matter of law, based on plan or design immunity established under the TCA; and, its engineers and general contractors were likewise entitled to summary judgment through derivative immunity.
Importantly, this decision highlights the protections afforded to public entities, and their private contractors, under the TCA. A public entity merely has to show that it approved the plan or design of the feature that is causally-related to the accident, in order for immunity to attach to the public entity and its contractors that carried out the plan or design. Additionally, the Court rejected plaintiff’s contention that immunity under the TCA was inapplicable because the public entity did not contemplate the specific slope degree of the curb, which demonstrated the broad immunity afforded to public entities under the TCA.
New Jersey Appellate Division Enforces “Additional Insured” Status
In this case, the Appellate Division provided that the patron’s use of the passageway at issue arose out of the restaurant’s use of the leased premises. In order to protect the interests of all parties, their identities will not be disclosed. In its holding, the Appellate Division affirmed the trial court’s finding that Company A’s insured, a landlord and owner of commercial property, was entitled to coverage as an “additional insured” under Company B’s policy, entitling Company A to a judgment comprised of its settlement payment and attorney’s fees and costs.
The controversy arose from a trip and fall accident by a patron of a restaurant insured by Company B. The restaurant leased the space from Company A’s insured. On the date of loss, after having dinner at the restaurant, a patron stepped into a hole depression in the passageway leading from the restaurant to its nearby parking lot. The patron subsequently instituted a personal injury action. Company A and Company B each paid the patron in settlement of the personal injury action. Company A then filed a declaratory judgment action seeking reimbursement of its portion of the settlement and for its attorney’s fees and costs from Company B. The Lease Agreement entered into between the restaurant and the landlord provided that the restaurant was required to “obtain, pay for, and keep in effect for the benefit of the landlord and the tenant public liability insurance on the [r]ental [s]pace.” Further, an Addendum to the Lease Agreement provided that the tenant “shall defend, indemnify and hold [l]andlord harmless, to the fullest extent permitted by law, for any actual or threatended occurrence arising out of the [t]enant’s operations, maintenance or use of that part of the premises leased to Tenant.” In order to satisfy those provisions, the restaurant procured insurance from Company B that named the landlord as an additional insured.
In affirming the trial court, the Appellate Division reasoned that additional insured coverage for a landlord is not contingent upon a finding of the tenant’s liability. Rather, there need be shown only a substantial nexus between the occurrence and the use of the leased premises in order for the coverage to attach. Where the nexus is present, an insurer would expect to provide coverage to a landlord, whether or not the occurrence takes place within the leased premises. That is so because in negotiating for such an endorsement in a lease, the landlord is attempting to insure against the risk of liability generated by the business about to be conducted by the tenant, and place the cost of insuring that risk on the tenant.
In this case, the Appellate Division provided that the use of walking through the passageway at issue was a use arising out of the use of the leased premises. As a result, because the patron’s trip and fall arose out of the operation of the leased premises, the occurrence fell under the language of the additional insured endorsement of Company B’s policy, whether or not the tripping hazard was located physically on the leased property. As a result of the foregoing, the Appellate Division found that Company A’s insured was an additional insured under Company B’s policy, and that Company A was entitled to reimbursement of the portion of the settlement proceeds it paid out, and its attorney’s fees and costs.
New Jersey Supreme Court Expands Scope of Liability for “Take-home” Torts
The New Jersey Supreme Court’s recent unanimous decision in Schwartz v. Accuratus Corp.expanded the scope of “take-home” tort liability, potentially exposing employers and premises owners to a large number of lawsuits. “Take-home” tort liability is where employers or premises owners are held liable for an employee or visitor being exposed to alleged toxins (such as asbestos or pesticides), then bringing the toxins home, exposing additional persons. In Schwartz, the plaintiffs, Brenda Ann and Paul Schwartz, alleged that Ms. Schwartz was exposed to asbestos fibers which her boyfriend, and eventual husband, Mr. Schwartz, brought home in his work clothes. Mr. Schwartz was employed by Accuratus Corporation, which manufactures ceramics in New Jersey. Moreover, another employee of Accuratus also shared an apartment with Mr. Schwartz for a period of time. While Ms. Schwartz did not live in the apartment, she frequently visited the apartment, and often laundered her boyfriend’s contaminated clothing and cleaned the apartment. Therefore, Ms. Schwartz was exposed to the asbestos fibers brought home from both Mr. Schwartz and his roommate. Due to her exposure to the asbestos fibers, Ms. Schwartz eventually contracted chronic beryllium disease, an untreatable disease affecting lung tissue, and filed suit against the defendants.
Plaintiff’s lawsuit was originally filed in Pennsylvania state court, and was then removed by the defendants to federal court. Defendant Accuratus’s motion to dismiss the complaint was granted by the trial court, which held that Accuratus did not owe a duty of care to Ms. Schwartz. In turn, the plaintiffs appealed the matter to the United States Court of Appeals for the Third Circuit. The question certified to the New Jersey Supreme Court by the Court of Appeals for the Third Circuit was: “[d]oes the premises liability rule set forth in Olivo extend beyond providing a duty of care to the spouse of a person exposed to toxic substances on the landowner’s premises, and, if so, what are the limits on that liability and the associated scope of duty.”
The New Jersey Supreme Court answered the question posed by the United States Court of Appeals for the Third Circuit in the affirmative. In reaching its decision, the New Jersey Supreme Court looked to the Court’s ruling in Olivo v. Owens-Illinois, Inc., 186 N.J. 394 (2006), where the Court imposed liability upon the defendant not mainly because plaintiff’s wife “was married to a worker a at Exxon who brought asbestos-contaminated clothing home from work but that it was foreseeable that she would be handling and laundering the soiled, asbestos-exposed clothes, which Exxon failed to protect at work and allowed to be taken home by workers.” While the New Jersey Supreme Court declined to “define the contours of the duty owed to others in a take-home toxic-tort action through a certified question of law,” the Court held that the duty owed to others in a take-home toxic-tort action “may extend, in appropriate circumstances, to a plaintiff who is not a spouse.” The Court reasoned that it is not put forth anywhere in Olivo “explicitly or implicitly, that a duty of care for “take-home” toxic-tort liability cannot extend beyond a spouse. Nor does it base liability on some definition of ‘household’ member, or even on the basis of biological or familial relationships.” As such, the Supreme Court in Schwartz established that there is no bright-line rules such as familial relationships, residence, or marital status for “take-home” toxic tort liability, but rather, it must be determined on a case to case basis whether the exposure was foreseeable based upon the facts of the matter.
The New Jersey Supreme Court’s decision in Schwartz thus strengthens the right of members of households, as well as potential guests, to file “take-home” tort liability claims. In light in this expansion in the scope of liability for “take-home” liability cases, employers and premises owners must assess their potential exposure pertaining to their coverage policies for general liability, premises liability, and pollution liability coverage.