December 2006, No. 7

December 2006, Vol. IV, No. 7

Happy Holidays. We wish all of you a happy holiday season and a healthy and happy new year. Eat, drink, and be merry, and be kind to your adversaries and the court! Also, call those clients back!

Sidewalk Law Quiz. In Lodato v. Evesham Township, 388 N.J. Super. 501 (App. Div. 2006), the Appellate Division reviewed the potential liability of residential property owners, a township, and the township shade advisory commission when a plaintiff fell on a four-inch raised sidewalk. Question #1: What duty does a residential property owner have for an adjacent sidewalk? Answer: Under the common law, none because such owners have sidewalk immunity unless they take some measure to repair the sidewalk, thereby creating or contributing to a dangerous condition. Question #2: What duty does an advisory commission have with respect to such sidewalks? Answer: None where the commission does not control tree removal. Question #3: What duty does a township have regarding public sidewalks? Answer: The Tort Claims Act governs, and thus, a township must have actual or constructive notice of the sidewalk's dangerous condition and must fail to take action. Trick Question: How does a municipal ordinance requiring homeowners to maintain adjacent sidewalks in good condition change traditional tort law? Answer: It does not change the law because municipal ordinances do not create a tort duty as a matter of law. If you answered: all four correct, you are an all-star; three correct, you are above average, two correct, average, one correct, below average and need to take Jerry Baker's class on premises liability, and zero correct, too busy reading Joe Rem's article or practicing in another area.

Is a Buyer of Goods for Resale a Consumer under the Consumer Fraud Act? No. In Papergraphics International, Inc. v. Correa, 2006 N.J. Super. LEXIS 320 (App. Div. 2006), Papergraphics bought thousands of ink cartridges for re-sale, and the Appellate Division found that such a purchase was not for consumption or use. Therefore, Papergraphics was not a as the corporation was purchasing goods that it intended to consume or use. This opinion makes sense because the statutory scheme is designed to protect consumers from unconscionable practices. In this case, the buyer had the right to pursue normal fraud or breach of contract remedies under the UCC.

Can an Insurer Refuse to Defend an Employer Sued by an Employee for a Workplace Injury Because of an Exclusion for Intentional Injuries? If you said yes, then you disagree with the Supremes who emphatically said NO. In Charles Beseler Co. V. O'Gorman & Young, Inc., 2006 N.J. LEXIS 1658 (2006), an employee lost eight fingers from a punch press because the employer allegedly consumer under the CFA, and could not seek treble damages and attorneys fees. The Appellate Division noted that a corporation could be a consumer so long removed safety guards and warnings from the machine. Thus, the employee filed suit against the employer for creating a "substantial certainty" that he would be injured. See Laidlow v. Hariton Mach. Co., 170 N.J. 602, 605 (2002). The employer's insurance policy maintained an exclusion for "bodily injury caused or aggravated" by the employer. The Supreme Court held that the policy language does not unambiguously exclude injuries falling under the substantial certainty standard from Laidlow. In essence, the Supremes found that the policy did not clearly include injuries unintentionally caused by intentional acts. Thus, the ambiguity required that the insurer defend the employer. This case protects the injured employee and employers by providing insurance for these injuries. However, expect to see insurers clarify the language in their policies. If such changes occur, employers will be faced with defending and paying for injuries sustained by its workers where the employers' actions create situations where there is a substantial certainty of injury. For those of you representing manufacturing companies, advise your clients of the likelihood of changes to their insurance policies.

Contributions. If you have an interesting case, rule interpretation, ethics issue, or civil-related story, please contact me at 201-918-3560, (f) (201) 845-5973, or e-mail [email protected]