Death benefits applicable to pending cases

In Cruz v. Central Jersey Landscaping, Inc., decided by the New Jersey Appellate Division on May 14, 2007, the majority found that amendments to N.J.S.A. 34:15-13 (which went into law effective January 14, 2004 setting a uniform 70% of the decedent’s wages as the death benefit amount in dependency cases regardless of the number of dependents) applied to pending workers’ compensation cases including claims where the worker’s death was prior to January 14, 2004.

New case law on Temporary Disability benefits

On March 30, 2007 the Appellate Division decided Ventura v. Reliable Wood Products, A-4554-05T1 (Mar. 30, 2007)(Not Approved for Publication). The cases presented a novel issue: an undocumented worker alleged that his daily weekly wages were $500 per week. The employer alleged that his wage was $6.15 per hour.

On November 22, 2005, the very first day he worked for the respondent, the claimant was injured (his right foot was amputated). The petitioner was loitering in the Bravo Supermarket parking lot in Orange, looking for work when he was approached by three employee of Reliable. The claimant reported to work at the Reliable premises.

According to the petitioner, he was to be paid “$100 per day” to cut wood with a power saw. According to the employer’s representative, the claimant was told (in the Supermarket parking lot) to get into a van. The claimant was allegedly told that he would find out his daily wage when he got to the worksite.

The Judge of Compensation found the issue to be “primarily one of credibility.” Finding that the respondent’s witnesses were “less than credible” due to conflicting testimony, the Judge found that the wage was $100 per day.

The decision of the Judge of Compensation was upheld by the Appellate Division. In light of the fact that the employer was unable to produce documentation of the wage to be paid, and in light of the lack of credibility of the respondent’s witnesses, the Appellate Division gave credit to the decision of the judge of compensation who was able to gauge the demeanor of the witnesses.

Jurisdiction of claims

On April 11, 2007 in Kibler v. Roxbury Bd. of Educ., the New Jersey Appellate Division affirmed the decision of a Superior Court trial judge, holding that a plaintiff injured at work as a result of an altercation between two students was barred from pursuing a civil action for damages against the students. The appellate court held that there was no “genuine issue of material fact” as to whether the teacher’s injuries came within the purview of conditions the New Jersey Legislature intended to exempt from the exclusive remedy provisions of Workers’ Compensation Act. The plaintiff’s exclusive remedy is with the Division of Workers’ Compensation for her work-related accident

Personal errands and work

On March 14, 2007, the New Jersey Appellate Division decided Valcarel v. FSA Management, A-40001-05T2 (Mar. 14, 2007)(Not Approved for Publication). The issue at bar was whether or not the claimant was “acting within the scope of his employment” when the accident occurred. The Appellate Division agreed with the Judge of Compensation (Judge Joel Gottlieb, New Brunswick) that the petitioner was engaged “on personal business when he was involved in the accident in question” and that no compensation would be payable.
The facts in Valcarcel are important to understanding the judges’ decision.
The claimant in Valcarcel was employed by FSA managing a residential apartment complex in Bridgewater. The petitioner was supplied with the use of a company vehicle (a Ford pickup truck). Occasionally the claimant would perform maintenance at other properties owned and operated by FSA.
The claimant also operated a personal business: home remodeling, which he pursued after normal work hours. FSA did not allow the claimant to use the Ford truck for his personal business.
On the date of accident the claimant was instructed to travel to Highland Park on behalf of his employer. Instead of driving straight to Highland Park, the claimant diverted his route and stopped at a private job site in Plainfield where he had been remodeling a private residence. After leaving that job site, the petitioner was involved in a motor vehicle accident in Plainfield.
Judge Gottlieb dismissed the claim petition, finding that the claimant had embarked on a personal errand. The petitioner argued that at the time of the accident, he was headed to Highland Park (as he had been originally instructed by his employer). The Appellate Division found this argument unpersuasive and upheld Judge Gottlieb, noting “that surely is not a dispositve fact, for it would logically signify that Valcarcel would likewise be entitled to coverage if, say, he had traveled several hours away for personal business to Cape May or to Connecticut before heading to Highland Park.”

Racketeers or Victims? The Melard cases

It is a familiar story in New Jersey: immediately after Melard Manufacturing Corporation closed its Passaic plant, laying off 111 workers, 84 of the former employees promptly filed workers’ compensation claims alleging a variety of “occupational” maladies. (Melard, which manufactured plastic bathroom parts and packaged other items, laid off the workers in 2002.) The problem: the employees were represented by a single law firm, which filed identical complaints for each former employee, changing only the personally-identifying information on each court pleading. Melard filed a complaint in federal Court alleging Racketeer Influenced and Corrupt Organizations Act (RICO) violations by the employees and their lawyers – alleging that “fraudulent claims were being filed” and that “workers were being coached.” Melard claims that the workers gave false complaints to their physicians and that the lawyers who filed the claims solicited and developed the complaints. Melard argued that none of their workers ever filed a claim for pulmonary-related complaints before the plant closed and no worker claimed retaliation for filing a claim. Melard allegedly was told of this wrong-doing by a former employee who came forward.

The law firm that filed to complaints quietly settled with Melard (Ginarte, O’Dwyer, Winograd & Laracuente) for an ‘undisclosed’ sum. That left the federal lawsuit pending against the 84 factory workers who filed the allegedly fraudulent claims. On February 21, 2006, a default judgment was obtained against the workers, who did not appear or defend the case on their own behalf.

Three weeks later, Federal (U.S. District) Judge Stanley Chesler entered a judgment of $2,264,691 against the workers (of which $350,678 was attorneys’ fees for Melard’s lawyers).

The saga as it stands now? The lawyers who brought the claims settled their portion of the case and moved on. The 84 workers were not so lucky. The federal judgment against them, likely uncollectable, stands.

More interesting is the fate of the two former-employees who continued to pursue their workers’ compensation claims against Melard (and were provided a court-appointed attorney, Gregory Jachts, Esq.). Two of those claimant received awards of compensation after trial (Judge Beverly Karch, Presiding Judge of Comepnsation, Paterson). In other words, the Compensation Judge found that the claimants had compensable injuries. Nonetheless, under the terms of the RICO judgment, the awards obtained by the employee were the results of a tainted claim, and the employees who recovered owe Melard triple their award!
We will continue to follow this story as it develops.

Defending Employers