STATUTE OF LIMITATIONS
- Personal Property6 YearsN.J.S.A. § 2A:14-1,2
- Personal Injury/Death2 YearsN.J.S.A. § 2A:14-2
- Breach of Contract/Written6 YearsN.J. Stat. § 2A-14-1
- Breach of Contract/Oral6 YearsN.J. Stat. § 2A-14-1
- Breach of Contract/Sale of Goods4 YearsN.J. Stat. § 12A:2-725
- Statute of Repose/ProductsN/AN/A
- Statute of Repose/Real Property10 YearsN.J.S.A. § 2A:14-1.1*
- Breach of Warranty/U.C.C.4 YearsN.J.S.A. § 12A:2-725
- Workers’ Compensation2 YearsN.J.S.A. § 34:15-40
- Strict Product Liability (Personal Injury)2 YearsN.J.S.A. § 2A:14-2
- Strict Product Liability (Property Damage)6 YearsN.J.S.A. § 2A:14-1
Statute of Limitations Exceptions
*10 Years from completion of improvement to real property. N.J.S.A. § 2A: 14-1.1.
Contributory Negligence/Comparative Fault
Modified Comparative Fault: 51% Bar. Damaged party cannot recover if it is 51% or more at fault. If 50% or less at fault, it can recover, although its recovery is reduced by its degree of fault. If plaintiff’s negligence is not greater than that of the defendant, plaintiff can recover but will find his damages proportionately reduced. N.J.S.A. § 2A:15-5.1.
Med Pay/PIP Subrogation
Med Pay: Med Pay subrogation rights in NJ remain unclear. NJ policies do not provide typical Med Pay benefits. However, “Extended Medical Benefits Payments” (EMBP) coverage is required per N.J.A.C. 11:3-7.3(b). They are not available where basic PIP benefits apply. Section 39:6A-4 makes no mention of EMBPs. It speaks only about “medical expense benefits.” EMBPs were part of NJ personal auto policies when no-fault laws were enacted. The Dept. of Ins. in Circular Letter New Jersey Automobile 9, dated February 22, 1993, explaining its position on PIP coverage, took the position that EMBP “will be subrogable.” No existing NJ cases mention this letter. Additionally, the Circular predates the passage of New Jersey’s collateral source rule, § 2A:15-97 and Perreira v. Rediger, 169 N.J. 399 (2001), which limit subrogation for bodily injury claims to those subrogation rights provided in a statute. There is no case law stating whether New Jersey’s PIP recovery statute, §39:6A-9.1 includes a right to recover Med Pay. However, Warnig v. Atlantic County Special Servs., 833 A.2d 1098 (N.Y. App. 2003) stated Med Pay can be subrogated from a worker’s comp carrier under § 39:6A-6, which, quite similarly to § 39:6A-9.1 allows for recovery from a worker’s comp carrier of “benefits pursuant to §§ 4 and 10 of P.L. 1972, c. 70 (C. 39:6A-4 and 39:6A-10), medical expense benefits pursuant to § 4 of P.L. 1998, c. 21 (C. 39:6A-3.1) or benefits pursuant to § 45 of P.L. 2003, c. 89 (C. 39:6A-3.3) it has paid….” Warnig held this recovery statute did not refer to Med Pay so Med Pay was not recoverable. Similarly, Ingresoll v. Aetna Cas. and Sur. Co., 649 A.2d 1269 (N.J. 1994) found that the anti-stacking provision of § 39:6A-4.2 does not apply to Med Pay, since they are not PIP benefits. Based on these decisions, it is unlikely that Med Pay is recoverable under § 39:6A-9.1. Put another way, if Med Pay is not PIP for purposes of §§ 39:6A-4.2 or 39:6A-6, it is probably not PIP for purposes of § 39:6A-9.1. Thus, subrogation recovery of Med Pay benefits is probably prohibited, and insurance regulations permitting subrogation and lien clauses for Med Pay are probably invalid and in violation of § 2A:15-97.
Choice No-Fault State. No-fault verbal threshold optional. No-fault introduced in 1973 with monetary threshold, which was changed to verbal threshold in 1988. In 1998, the law allowed consumers to choose between “standard auto policy” and “basic auto policy”. Standard policy requires choice of tort options: (1) verbal threshold (can recover non-economic damages only when death, dismemberment, disfigurement or permanent injury); or (2) traditional tort option (unrestricted recovery of non-economic damages). N.J.S.A. § 39:6A-43. Default is verbal.
Formal demand for arbitration must be filed within two years of filing PIP claim in order to satisfy statute governing recovery of PIP benefits from tortfeasor. N.J.S.A. § 39:6A-9.1; New Jersey Auto. Full Ins. Underwriting Ass’n v. Liberty Mutual Ins. Co., 636 A.2d 550 (N.J. Super. 1994).
PIP: No direct subrogation rights against tortfeasor exist where PIP benefits are paid, even when tortfeasor is not covered by no-fault insurance. Latimer v. Boucher, 458 A.2d 528 (N.J. Super. 1983); N.J.S.A. § 39:6A-12 (no-fault benefit payment evidence exclusionary rule). May be able to subrogate against commercial vehicle or livery vehicle (many rules and exceptions). PIP benefits are recoverable within 2 years from (1) tortfeasors not required to carry PIP or (2) tortfeasors required to carry PIP but failed to do so. N.J.S.A. § 39:6A-9.1. This includes all non-motor vehicle defendants (dram shop, product liability). State Farm v. Licensed Beverage Ins. Exch., 679 A.2d 620 (N.J. 1996). (Costs of processing PIP benefits also recoverable). An example would be commercial and public vehicles, and some out-of-state vehicles. State Farm v. Licensed Beverage Ins. Exch., 679 A.2d 620 (N.J. 1996). This creates a “new direct right of action” in the insurer that is “primary and not linked to any purported subrogation rights.” Hanover Ins. Co. v. Borough of Atlantic Highlands, 709 A.2d 236 (N.J. Super. 1998). There is no right of subrogation or reimbursement against a public entity. N.J.S.A. § 59:9-2(e).
Automobile: Pro-Rata In Physical Damage Claims. (See Formula). N.J. Admin. Code 11:3-10.7 provides: (a) If an insured has received payment under his or her physical damage coverage that is subject to a deductible, the insured shall share, pro-rata, with the insurer any net recovery received by the insurer from third parties; (b) Net recovery shall be the total recovery less the insurer’s allocated loss adjustment expenses attributable to such recovery. The formula for computing net recovery and the insured’s share of recovery of the deductible may be stated as follows: Total Recovery – Allocated Loss Adjusting Expenses = Net Recovery (Deductible ÷ Total Loss) X Net Recovery = Insured’s Share of Recovery; (c) Unless the insurer returns its insured’s full deductible the insured shall attempt to effect full recovery in clear liability cases and shall not enter into any intercompany agreements that provide for the acceptance of lesser amounts on a formula basis; and (d) If an insurer has paid a physical damage claim that is subject to a deductible and it elects not to pursue its subrogation claim where the probability of recovery exists, the insurer shall so notify its insured in writing within 60 calendar days after it has paid the claim, except that the notification shall be given at least 30 days prior to the running of any applicable statute of limitations or period required for notice of claim. If an insurer does not notify its insured within the time periods prescribed above and the statute of limitations or period required for notice or claim has expired, the insurer shall forthwith remit to its insured the full amount of the insured’s deductible.
For physical damage claims, there is no specific requirement to include the deductible in the demand but the insured must be reimbursed pro-rata any net recovery. If the insurer does not pursue subrogation where probability of recovery exists, the insurer must notify the insured in writing within 60 days after it has paid the claim – within 30 days if the statute of limitations is running. If statute of limitations runs and the insurer hasn’t complied with these notice provisions, the insurer must reimburse the full amount of the deductible to the insured.
Automobile: PIP/Med Pay Deductible Recoveries Not Allowed. N.J. Admin. Code S.A. § 39:6A-12. The Automobile Reparation Reform Act (no-fault law) prohibits the injured party from recovering a medical expense deductible and/or 20% copayment under a PIP policy from the tortfeasor.
Related Case Law: Roig v. Kelsey, 641 A.2d 248 (N.J. 1994).
Made Whole Doctrine
New Jersey has adopted the Made Whole Doctrine. O’Brien v. Two West Hannover Co., 795 A.2d 907 (N.J. Super. 2002); McShane v. N.J. Mfrs. Ins. Co., 375 N.J. Super. 305, 312 (App. Div. 2005); In Re Complaint of Weeks Marine, 2006 WL 1843130 (D.N.J. 2006). An insurer who is entitled to subrogate may not do so if the insured has not been made whole. Werner v. Latham, 752 A.2d 832 (N.J. Super. 2000). New Jersey adheres to the Made Whole Doctrine with regard to automobile insurance subrogation, even though direct automobile insurance medical subrogation is not allowed, and health insurance subrogation, even though health insurance subrogation is not allowed. However, there is authority in New Jersey to the effect that the Made Whole Doctrine may be overridden by specific contract terms in a Plan or policy. Providence Wash. Ins. Co. v. Hogges, 171 A.2d 120, 124 (N.J. 1961); Culver v. Ins. Co. of North Am., 559 A.2d 400 (N.J. 1989). In Hogges, the Court explained that: In the absence of express terms in the contract to the contrary, [the insured] must be made or kept whole before the insurer may recover anything from him or from a third party under its right of subrogation. Against the insured, as well as against third parties, there may be recovery by the insurer (again, subject to the express terms of the contract) only if the cause is just and enforcement is consonant with reason and justice. Hogges, supra.
The Made Whole Doctrine should not take precedence over UM/UIM subrogation rights. Nikiper v. Motor Club of America Co., 557 A.2d 332 (N.J. Super. 1989). The Made Whole Doctrine also should not affect PIP recovery rights, but because such rights are limited to the third-party liability policy limits, there is often a race to recover these policy limits. Fernandez v. Nationwide Mut. Fire Ins. Co., 821 A.2d 564 (N.J. Super. 2008).
The New Jersey Supreme Court has observed that the Made Whole Doctrine applies to contractual as well as equitable subrogation. Culver, supra. An insurer may not avoid application of Made Whole Doctrine unless the insurance contract is sufficiently specific and honors reasonable expectations of the parties. In this context the relevant subrogation clause and agreements are to be evaluated. If the subrogation clause or contract is sufficiently specific to alter the common law Made Whole Doctrine neither can be disregarded unless it fails to honor the reasonable expectation of the parties is unconscionable, and violative of public policy. Under this approach the issue of whether the insured has been made whole or fully compensated is a question of law for the court. Werner, supra.
Economic Loss Doctrine
Majority Rule. A consumer may not bring an action in negligence and strict liability for economic loss arising from the purchase of a defective product, but must rely on breach of warranty remedies in U.C.C. Alloway v. General Marine Indus., L.P., 695 A.2d 264 (N.J. 1997). New Jersey has not decided whether the ELD applies when the parties are of unequal bargaining power, the product is a necessity, no alternative source for the product is readily available, and the purchaser cannot reasonably insure against consequential damages. In 1987, New Jersey adopted the ELD via statute with the Product Liability Act, in which it defines “harm” as physical damage to property, other than the product itself. N.J.S.A. § 2A-58C-1. Where a subrogation suit is brought against the insurer of a yacht that sunk, the subrogated carrier is limited to warranty claims with regard to recovery of damages to the yacht itself. Alloway, supra. Exceptions include when there is damage to “other property” (Naporano Iron & Metal Co. v. American Crane Corp., 79 F.Supp2d 494 (D.N.J. 1999)) and fraud and misrepresentation (Coastal Group, Inc. v. Dryvit Sys., Inc., 643 A.2d 649 (N.J. 1994). There is no “sudden and calamitous” event exception. Naporano, supra.
Within the ELD, the “product” includes all component parts. Sea-Land Serv., Inc. v. General Elec. Co., 134 F.3d 149 (3rd Cir. 1998) (defective master connecting rods caused ship engine failure). Since all but the very simplest of machines have component parts, a contrary holding would require a finding of property damage in virtually every case where a product damages itself. A battery is considered a component part of a sailboat if it is originally outfitted with the boat when purchased. Cont’l Cas. Co. v. Exide Techs., 2010 WL 11570369 (D. N.J. 2010) (Note: plaintiff claimed the battery created a health risk to its insured, but the court noted that such potential for harm to the insured was not pled in the Amended Complaint, which sought recovery for “substantial damage and destruction to the Sailboat.”).
Absent a clear contractual expression to the contrary, the insurance carrier will be permitted to sue a tenant in subrogation. Zoppi v. Traurig, 598 A.2d 19 (N.J. Super. 1990). If the landlord has a claim against the tenant, existence of insurance obtained by the landlord, paid by the landlord, for the benefit of the landlord, does not exculpate the tenant from consequences of negligent conduct, absent express agreement to that effect. Id.
Adverse Inference/Sanctions: Spoliation of evidence in a prospective civil action occur when evidence relevant to the action is destroyed, causing interference with the action’s proper administration and disposition. Manorcare Health v. Osmose Wood, 336 N.J. Super. 218, 226, 764 A.2d 475, 479 (N.J. App. Div. 2001). In civil litigation, depending on the circumstances, spoliation of evidence can result in a separate tort action for fraudulent concealment, discovery sanctions, or an adverse trial inference against the party that caused the loss of evidence. Rosenblit v. Zimmerman, 166 N.J. 391, 400-06, 766 A.2d 749 (N.J. 2001). But, the Supreme Court of New Jersey held that it did not recognize a separate tort action for intentional spoliation. Id. at 404-405. An adverse inference instruction may be given during the underlying litigation whereby it is presumed the destroyed evidence would have been unfavorable to the destroyer. Swick v. N.Y. Times, 815 A.2d 508, 511 (N.J. 2003).
Discovery sanctions may include a designation that certain facts are taken as established, a refusal to permit the disobedient party to support or oppose claims or defenses, prohibiting the introduction of designated matters into evidence, dismissal of an action, or entry of judgment by default. Id. An appropriate remedy may include an award of counsel fees in exceptional cases, particularly where there is a finding of intentional spoliation and the non-spoliating party’s ability to defend itself was compromised. Grubbs v. Knoll, 376 N.J. Super. 420, 435-436, 870 A.2d 713 (N.J. Super. A.D. 2005).
Damage to Certain Transportation Infrastructure. Liability imposed on parents when a child willfully or maliciously causes damage to railroad, public utility, street railway, traction railway. N.J.S.A. § 2A:53A-16.
The limit of liability is $5,000.00 plus costs. Child must be under 18-years-old.
Damage to School Property. Liability imposed on parents when a child damages school property. N.J.S.A. § 18A:37-3.
There is no limit to liability. Child must be under 18-years-old.
Modified Joint and Several Liability. Several liability for defendants less than 60% at fault, otherwise defendants will be held jointly and severally liable. N.J.S.A. § 2A:15-5.3.
Contribution allowed provided there is a judgment, determination of plaintiff’s damages, and existence of non-settling defendants. Settling tortfeasor is entitled to contribution from other joint tortfeasors if settlement extinguishes the joint tortfeasor’s liability and settlement was reasonable, provided the settlement is elevated to a final judgment (e.g., consent judgment from court or dismissal). N.J. Stat. § 2A:53A-3; Steele v. Kerrigan, 689 A.2d 685 (N.J. 1997). No contribution allowed with ordinary settlement, unless there was a dismissal, the non-settling tortfeasor was not a party to the suit, and the SOL bars any subsequent claim against the contribution defendant by the original plaintiff. Gangemi v. National Health Laboratories, Inc., 701 A.2d 965 (N.J. App. 1997). There is a six (6) year statute of limitations from the date the cause of action accrues (payment). N.J.S.A. § 2A:14-1; Ideal Mut. Ins. Co. v. Royal Globe Ins. Co., 511 A.2d 1205 (N.J. Super. 1986).
Suspension of Drivers' Licenses
Administrative Suspension: Within 90 days of receipt of the accident report, the Director may suspend the license of each driver and the registration of each owner involved in the accident unless they deposit security or provide proof of insurance. N.J.S.A. § 39:6-25(b). Suspension will last for one year if no action for damages was filed or until the driver deposits the required security, is adjudicated not liable, is released, or enters into an installment agreement. N.J.S.A. § 39:-27.
Judgment: If an uninsured driver fails to satisfy a final judgment rendered against him within 60 days, upon receiving a certified copy of the judgment, the Director will suspend the judgment debtor’s driver’s license. N.J.S.A § 39:6-35. The suspension will stay in effect as long as the judgment is unstayed and unsatisfied, or by an order of the same court in which the judgment was entered. N.J.S.A § 39:6-35.
Contact Information: State of New Jersey, Motor Vehicle Commission, P.O. Box 160, Trenton, NJ 08666, (609) 292-6500, http://www.state.nj.us/mvc/Violations/suspension.htm.
Prohibits Broad Indemnity. Applies to any Covenant, Promise, Agreement or Understanding in Connection with Construction Contract. N.J. Stat. § 2A:40A-1.
Not applicable to validity of insurance policy or workers’ compensation issue.
Diminution of Value
First Party: Depends on policy language. Early case law says that actual cash value of an auto loss is established as fair market value, and have applied principles holding that when the cost to repair a vehicle is proven, but there exists additional proof showing that even with the repair, the vehicle has depreciated, the plaintiff is entitled to the reasonable cost of repair plus the depreciation, if any. Fanfarillo v. East End Motor Co., 411 A.2d 1167 (N.J. App. 1980). Where policy unambiguously excludes coverage for diminution of value the insurer’s liability is capped at the cost of returning the damaged vehicle to substantially the same physical, operating, and mechanical condition as existed immediately before the loss. Insurer’s obligation does not include liability for any inherent diminished value caused by conditions or defects that are not subject to repair or replacement, such as a stigma on resale resulting from “market psychology” that a vehicle that has been damaged and repaired is worth less than a similar one that has never been damaged. Kieffer v. High Point Ins. Co., 25 A.3d 1206 (N.J. Super. App. 2011).
Third Party: Measure of damages, when auto is damaged, is the difference between the reasonable market value of auto before and after the tortious injury and the cost of repair and the depreciated value of vehicle as a result of having been in an accident, is the appropriate measure of damages, so long as total does not exceed the diminution in market value and does not exceed the pre-accident market value of the vehicle. Fanfarillo v. E. End Motor Co., 411 A.2d 1167 (N.J. Super. 1980). In Fanfarillo, the value before the theft was $7,900 and after the theft $5,000, a difference of $2,900. There was also evidence that the vehicle as repaired was worth only $7,500, so that the jury could have found total damages to the vehicle of $2,313 ($1,913 for the cost of repair and $400 depreciated value).
One-Party Consent: It is not unlawful for an individual who is a party to or has consent from a party of an in-person or electronic communication to record and or disclose the content of said communication unless the person is doing so for the purpose of committing a tortious or criminal act. It is also lawful for an individual to record electronic communications that are accessible to the general public. N.J. Stat. Ann. § 2A:156A-4(d); N.J. Stat. Ann. § 2A:156A-2.
New Jersey statute permits recovery of restitution by a “victim,” albeit in an amount based upon the severity of the defendant’s criminal conduct. N.J. Stat. Ann. § 2C:43‐3. Appropriate case law has stated that insurers can recover restitution payments only after making payments to their insured. State v. Jones, 789 A.2d 131 (N.J. Super. Ct. App. Div. 2002).
Health and Disability Insurance
Statute of Limitations: 2 Years. N.J.S.A. § 2A:14-2. Medical Malpractice – 6 Years. Fraser v. Bovino, 721 A.2d 20 (N.J. App. Div. 1998).
Subrogation of Medical and Disability Benefits are not allowed. N.J.S.A. § 2A:15-97.
Funeral Procession Traffic Laws
New Jersey law states that if any procession takes longer than five minutes to pass a given point, it must be interrupted every five minutes for waiting traffic. N.J. Stat. § 39:4-93. The ambiguity of the law was interpreted by a New Jersey court in 1978, which concluded that it was not intended to give a funeral procession a preferential right-of-way, nor did it take precedence over the requirement to stop for a red light. The case arose when a driver entering an intersection under a green light collided with a member of a procession who had entered against a red light. Pohi v. Topal, 383 A.2d 435 (N.J. Super. 1978). Authorized emergency vehicles, U.S. mail vehicles, and physicians’ vehicles have the right-of-way through a procession.
Statute of Limitations: 2 Years. N.J.S.A. § 34:15-40.
Can Carrier Sue Third Party Directly: Yes, after 1 year.
Recovery from UM/UIM Benefits: Yes.
Subrogation Against Medical Malpractice: Yes.
Subrogation Against Legal Malpractice: Yes.
Recovery Allocation/Equitable Limitations: A carrier is reimbursed, less pro-rata share of the fees/costs.
Employer Contribution/Negligence: No.
Attorney’s Fees/Costs: Pro-rata of 1/3 fees and up to $750 in costs.
Future Credit: Yes.
Auto No-Fault: Yes.
Dog Bite Laws
Dog owner will be held strictly liable for damages to victim when victim is on public property or lawfully on private property. N.J. Stat. Ann. § 4:19-16.
Employee Leasing Laws
An employee leasing company must register with the State under the State’s statutes. If it does, the employee leasing company and the client company are both considered employers and immune from third-party actions under the Exclusive Remedy Rule. N.J.S.A. § 34:8-72.
Condominium Waiver of Subrogation Laws
New Jersey has not adopted the Uniform Common Interest Real Property Act. Title 46 discusses the responsibilities of a condo association, however, subrogation is not mentioned. See N.J.S.A. § 46:8B-14 Duties of the Association and § 46:8B-24.
Condo owner sued association for water damage from leaking pipe in common area. By-laws required unit owners to carry insurance with waiver of subrogation. The court denied recovery because the by-laws contemplated that there would be no litigation between unit owners and the association based on damage to the condo units or the personal property contained in them. Schoolhouse Commons at Union Ave. Condo Assoc. v. CCTS Tax Liens I, LLC, 2012 WL 95593 (N.J. App. 2012).
Subrogation waiver in condo by-laws precluded unit owner’s insurer from subrogating against uninsured upstairs neighbor and condo association. Skulskie v. Ceponis, 962 A.2d 589 (N.J. Super. A.D. 2009).
Automobile Total Loss Thresholds
Total Loss Formula (See HERE for definition).
Insurer determines if it is “economically impractical” to repair vehicle or cost of repairs is higher than the market value of the vehicle. N.J.S.A. § 13:21-22.3 .
Sudden Medical Emergencies While Driving
Sudden Emergency Doctrine. Defense may only be used in situations where a driver is confronted by an imminent situation over which he had no control, without fault on his part. Leighton v. Sim, 591 A.2d 985 (N.J. App. Div. 1991).
No cases using the sudden emergency defense for a medical emergency.
State Sovereign Immunity And Tort Liability
Tort Claims Act: New Jersey Tort Claims Act. N.J.S.A. §§ 59:1-1 through 59:12-3 (1972).
Notice Deadlines: A claim against the State for death or for injury or damage to person or to property shall be presented not later than the 90th day after accrual of the cause of action. Six months after notice has been received, suit may be filed. Suit must be filed within two years after the date of accrual. N.J.S.A § 59:8-8.
Claims/Actions Allowed: A public entity is liable for injury proximately caused by an act or omission of a public employee within the scope of employment in the same manner and to the same extent as a private individual under like circumstances. N.J.S.A. § 59:2-2. For claims against the State involving a State employee’s negligent operation of a State motor vehicle, the plaintiff must show that the actions were “palpably unreasonable.” Coyne v. State, Dep’t of Transp., 867 A.2d 1159 (2005).
Comments/Exceptions: The State is not liable for acts involving a discretionary function. N.J.S.A. § 59:2-3. The State is not liable for any injury caused by adopting or failing to adopt a law or by failing to enforce any law. N.J.S.A. § 59:2-4. The State is not liable for injury caused by its failure to make an inspection, or by reason of making an inadequate or negligent inspection of any property. N.J.S.A. § 59:2-6. The State is not liable for the acts or omissions of a public employee constituting a crime, actual fraud, actual malice, or willful misconduct. N.J.S.A. § 59:2-10. See N.J.S.A. § 59:2-5 for other exceptions.
Damage Caps: None.
Recovery of Sales Tax After Vehicle Total Loss
First-Party Claims: Insurer must (1) offer a cash settlement based upon the actual cost of a “substantially similar auto” including all applicable taxes and other fees, or (2) offer a replacement auto including all applicable taxes, license fees, and other fees. N.J. Admin. Code § 11:3-10.4.
Third-Party Claims: No applicable statute, case law, or regulation governing recovery of sales tax.
Damage to Property Without Market Value
Service Value: “In short, at least upon the record before us, we cannot say with reasonable assurance that the installation of a new pole did more than remedy the wrong done.” New Jersey Power & Light Co. v. Mabee, 197 A.2d 194 (N.J. 1964).
Intrinsic Value: When, however, the personalty (sic) is household furnishings and wearing apparel and the like, where the market value cannot be ascertained, the better measure of damages and the one we find applicable in this case, is the actual or intrinsic value of the property to the owner, excluding sentimental or fanciful value. Lane v. Oil Delivery, Inc., 524 A.2d 405 (N.J. Super. Ct. App. Div. 2006).
Sentimental Value: When, however, the personalty (sic) is household furnishings and wearing apparel and the like, where the market value cannot be ascertained, the better measure of damages and the one we find applicable in this case, is the actual or intrinsic value of the property to the owner, excluding sentimental or fanciful value. Lane v. Oil Delivery, Inc., 524 A.2d 405 (N.J. Super. Ct. App. Div. 2006).
Municipal/County/Local Governmental Immunity and Tort Liability
New Jersey Tort Claims Act: N.J.S.A. §§ 59:1-1 through 59:12-3 (1972). “Public entity” includes all counties, municipalities, districts, and other political subdivisions. N.J.S.A. § 59:1-3. Immunity waived. A “public entity” is liable for injury caused by an act or omission of a public employee in the same manner and to the same extent as a private individual unless there is exception in Act. N.J.S.A. § 59:2-2.
Notice Deadlines: A claim against a “public entity” for death or for injury or damage to person or to property shall be presented not later than the 90th day after accrual of the cause of action. Six (6) months after notice has been received, suit may be filed. Suit must be filed within two (2) years after the date of accrual. N.J.S.A § 59:8-8.
A suit for contribution or indemnity against a public entity by a defendant is included in these requirements. Jones v. Morey’s Pier, Inc., 2017 WL 3184454 (N.J. 2017).
Claims/Actions Allowed: Public entity liable for:
- Condition of property if dangerous condition and failure to take action “palpably unreasonable.” N.J.S.A. § 59:2-3.
- Sewer back up if maintenance program was palpably unreasonable or negligence in performance.
- Ministerial or operational functions.
- Negligent operation of motor vehicle. Gruschow v. New Jersey State Highway Dep’t, 152 A.2d 150 (N.J. App. 1959).
Limitations on liability:
- A discretionary function (involves policy judgment or determining resources or when or whether to purchase equipment, construct or maintain facilities, hire personnel or provide adequate services). N.J.S.A. § 59:2-3.
- Adopting or failing to adopt a law or by failing to enforce any law. N.J.S.A. § 59:2-4.
- Failure to make an inspection, or negligent inspection of any property. N.J.S.A. § 59:2-6.
- Crime, actual fraud, actual malice, or willful misconduct. N.J.S.A. § 59:2-10.
- Discretion in decision-making or prioritizing needs when faced with budgetary issues.
See N.J.S.A. § 59:2-5 for other exceptions.
Damage Caps: No Dollar Caps. No subrogation allowed against “a public entity or public employee.” N.J.S.A. § 59:9-2(e). No recovery for pain and suffering, but limitation on recovery unless permanent loss of bodily function, permanent disfigurement, or dismemberment when medical expenses are in excess of $3,600. Punitive damages cannot be awarded. N.J.S.A. § 59:9-2 (c) and (d).
No Pay, No Play Laws
Rule: New Jersey statute bars uninsured motorists that are injured, drivers under the influence that are injured, or acting with the intent to injure himself or others while operating a vehicle from economic and non-economic recovery from the tortfeasor.
Authority: New Jersey Supreme Court upheld New Jersey’s No Pay, No Play laws as constitutional. Caviglia v. Royal Tours of America, 842 A.2d 125 (Sup. Ct. of N.J. 2004). N.J.S.A. § 39:6A-4.5
Laws Regarding using Cell Phones/Headphones/Texting While Driving
Cell Phone/Texting: Drivers with a learner’s permit may not use a cell phone in any capacity. N.J.S.A. § 39:3-13.2a.
All cell phone use must be hands-free, which includes text messaging. N.J.S.A. § 39:4-97.3(a).
Other Prohibitions: No Applicable Laws.
Comments: No person may use earphones or headphones while operating a self-propelled vehicle, motorized vehicles, or bicycles while on the street. Sayreville Borough, N.J. Code of Ordinances § 5-19.
Admissibility of Expert Testimony
Admissibility Standards: Frye
Case/Statutory Law: N.J. R. Evid. 702
Workers’ Compensation Claims by Undocumented Employees
Statute: The statute is silent on “aliens” and their legal status. N.J. Stat. Ann. § 34:15-36.
Case Law: Mendoza v. Monmouth Recycling Corp., 672 A.2d 221 (N.J. Super. App. Div. 1996). Fernandez-Lopez v. Cervino, 671 A.2d 1051 (N.J. Super. Ct. App. Div. 1996).
Comments/Explanation/Other: Mendoza concluded that because illegal aliens can file civil actions in court, they should be entitled to statutorily-mandated substitute of workers’ compensation. Cervino held that undocumented aliens could recover workers’ compensation benefits because the statutory definition did not exclude illegal aliens.
Product Liability Law
Statute of Limitations/Repose: 2 years for personal injury and wrongful death. N.J.S.A. § 2A:14-2. Discovery Rule applies. Statute of Repose is 10 years. N.J.S.A. § 2A:14-1.1.
Liability Standards: Strict Liability, Consumer Expectation, Warranty.
Fault Allocations: Modified Comparative. N.J.S.A. § 2A:15-5.1.
Non-Economic Caps/Limits On Actual Damages: Yes.
Punitive Y/N and Limits: Yes (Limits).
Heeding Presumption?: Yes, Rebuttable.
Innocent Seller Statute: Yes. N.J.S.A. 2A:58C-9(b).
Joint and Several Liability: Yes, if > 60%. N.J.S.A. § 2A:15-5.3.
Available Defenses: Assumption of Risk; Misuse; Alteration; Learned Intermediary; Inherently Unsafe Products; State of the Art; Government Contractor Defense; Presumption; Seatbelts; Alcohol/Drugs; Sophisticated User.
Restatement 2nd or 3rd?: Restatement 3rd
Imputing Contributory Negligence of Driver to Vehicle Owner
Imputed Contributory Negligence Law: Contributory negligence of permissive user of vehicle is not imputed to owner when owner sues third party to recover for damages to vehicle. Motorlease Corp. v. Mulroony, 81 A.2d 25 (N.J. 1951).
Vicarious Liability/Family Purpose Doctrine: No Vicarious Liability Statute.
An agency relationship is created when one family member performs an act for another. When one member of the family is acting for a “family purpose” it may justify holding the head of the family vicariously liable for the driver’s negligent operation of a motor vehicle. Willett v. Ifrah, 298 N.J. Super. 218, 219, 689 A.2d 195, 195 (App. Div. 1997).
Sponsor Liability for Minor’s Driving: No Sponsorship Liability Statute.
Owner Liability For Stolen Vehicles
Key In The Ignition Statutes: N.J.S.A § 39:4-137. (Requires the motor to be turned off in unattended vehicle but says nothing about removing key from ignition).
Common Law Rule: A vehicle owner can be held liable for injuries to a third party where the theft was foreseeable and could have been guarded against. Hill v Yaskin, 380 A2d 1107 (1977); Lomano v. Ideal Towel Supply Co., 51 A.2d 888 (Dist. Ct. Hoboken, N.J. 1947).
New Jersey courts have generally followed the ASR with one limited exception in cases involving an insured’s criminal wrongdoing. See Ambassador Ins. Co. v. Montes, 388 A.2d 603 (N.J. 1978) (holding that in the case of an insurer, who pays an innocent party monetary damages due to liability of the insured ascribable to a criminal event, it is usually equitable that the insurer be indemnified by the insured). An insurer cannot subrogate against a co-insured. Guideone Mut. Ins. Co. v. Comito, 2007 WL 3170127 (N.J. Super. Ct. App. Div. 2007). Under N.J.S.A. § 39:6B-1, an auto dealer has no obligation to provide collision insurance for permissive test drivers therefore, unless the policy states otherwise, the permissive test driver is not an insured for damages to the vehicle and subrogation is permissible for physical damage to the test-driven vehicle. Universal Underwriters Group v. Heibel, 901 A.2d 398 (N.J. Super. Ct. App. Div. 2006). However, if an accident results in injury to an innocent third party, under N.J.S.A. § 39:6B-1, the vehicle owner’s liability insurance covers the test driver for injuries to that third party, preventing subrogation for those injuries. See Id. In Heibel, Heibel lost control of a motorcycle while test driving it and crashed. Universal Underwriters Group (“Universal”) paid the dealership for damages to the motorcycle and then sought to subrogate against Heibel for the damages to the motorcycle. The court held that Universal’s policy itself did not make Heibel an insured for damages to the vehicle, and that N.J.S.A. § 39:6B-1 did not mandate that permitted test drivers be insured under a dealership’s policy for physical damage to the vehicle. Therefore, subrogation for physical damage to the vehicle was permissible. In Hanover Ins. Co. v. Mi-Jack Products, Inc., 2018 WL 4761579 (D. N.J. 2018), Norfolk Southern filed an insurance claim with Hanover Insurance for damage to its lift truck. Hanover paid $408,100 to Norfolk Southern, which then assigned Hanover all of its “claims, rights and demands against third-persons” related to the damage to the lift truck. Hanover filed a subrogation suit against Mi-Jack and Mi-Jack then filed a Third-Party Complaint against H&M and others asserting claims for contribution and indemnification. Mi-Jack’s claims against H&M assert that if H&M’s negligence caused damage to the lift truck, H&M would be contributorily liable for the monetary payments Mi-Jack would have to pay out if it is found liable. H&M argued that New Jersey’s “anti-subrogation rule” barred Hanover from asserting a “right of subrogation against its own insured under the subrogating insurer’s policy.” The court held that it could not say that H&M, by virtue of its contractual obligation to pay for the insurance policy, is an “insured,” “co-insured,” or “additional insured” under that policy.
Use of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Authority: N.J.A.C. § 11:2-17.10.
Summary: Non-OEM parts must be marked with the manufacturer’s identification and that identification should remain visible if at all practical. Insurers may not require the use of non-OEM parts unless it is of equal quality to its OEM counterpart and the part’s manufacturer has placed a warranty on the part. The estimate must inform the insured that the repairs include non-OEM parts and that the non-OEM parts are of equal quality to their OEM counterpart.