WCM Announces New Resident Partner in New Jersey Office

Wade Clark Mulcahy takes pleasure in welcoming Vito (“Tony”) Pinto as Resident Partner of its Springfield, New Jersey, office.  Tony brings 25 years of litigation experience to the firm’s New Jersey litigation practice and possesses expertise in the defense of premises liability, property damage, construction defect and environmental matters in state and federal courts.  He has also handled many significant and sophisticated compliance and enforcement actions as well as private party cost recovery and multi-party cost allocation proceedings.  Tony is joining WCM upon the happy graduation of Denise Ricci from WCM partner to caregiver for her grandchildren and to pursue charitable works throughout New Jersey. 

Prior to joining WCM, Tony was a partner at a regional law firm where he served on that firm’s Management Committee and was in charge of recruitment.  Before entering private practice, Tony served as Law Clerk to the Honorable James J. Petrella, Presiding Judge of the New Jersey Appellate Division.  He received his law degree, with Honors, from the George Washington University National Law Center and his bachelor’s degree from Franklin and Marshall College.

 

Charitable Immunity Blocks Personal Injury Claim (NJ)

While attending a country music star concert at Monmouth University, plaintiff brought suit after she allegedly fell on unsafe stairs at the university’s Multipurpose Activity Center. Monmouth University had rented out the activity center to another company for the purposes of holding this concert. Plaintiff alleged that she was a business invitee and that the university breached its duty of care. The trial court granted summary judgment in favor of the university, citing the Charitable Immunity Act.

The Charitable Immunity Act protects nonprofit organizations that are organized exclusively for religious, charitable or educational purposes from damages to any person where such person is a beneficiary to the works of such nonprofit corporation.  An entity qualifies for charitable immunity when the following three requirements are met: (1) it was formed for nonprofit purposes; (2) it was organized exclusively for religious charitable or educational purposes; and (3) it was promoting such objectives and purposes at the time of the injury to plaintiff who was then a beneficiary of the charitable works.

Plaintiff conceded that the university satisfies the first two prongs of the charitable immunities standard. However, she argued that the country star concert was not an “educational” event. The courts rejected this argument, finding that the country music star’s concert was titled “Joy of Christmas” which was likely to include Christmas music. Whether classical, country or Christmas, music is an art and the court found that the concert was “a cultural and educational experience for patrons of this form of artistic production.”  The university would have been immune if it presented such a concert itself, and the court found that it was no less immune just because it rented out its facilities to the outside entities who presented the concert.

Notably, even an organization “organized exclusively” for “charitable” purposes may be immune when it rents its facilities to for-profit entities. The courts have historically found that non-profit organizations that rent its facilities to the general public for activities such as piano recitals, dance classes and concerts serves important social and recreational needs of the community. As such, the trial courts grant of summary judgment in favor of the university was affirmed by the appellate court.  Thanks to Steve Kim for his contribution to this post.  Please email Brian Gibbons with any questions.

Court Refuses to Apply “Helicopter Educator” Standard (NY)

In recent years, the term “helicopter parent” has entered our lexicon to describe parents who provide too much close attention to their children at every waking moment.  A recent decision from the Second Department refused to enshrine the concept of “helicopter educator” into law.

In LR v. City of New York, the parent of a four year filed a derivative action against the City of New York and the Department of Education for injuries sustained after the four year-old tripped on the foot of a chair while returning her food tray to a trash bin.  The plaintiff argued the activity was not an age-appropriate task, but the court disagreed.

While the court acknowledged that schools owed a duty to adequately supervise their students, they are not required to “continuously supervise and control all movements and activities of students.”  That, coupled with the fact that the students had performed that simple task every single day led the court to grant the City’s motion for summary judgment.

While the court refused to apply a helicopter educator standard to school districts, educational facilities should not read the decision as a license to be lax in supervising children.  The duty to supervise still applies.       Thanks to Mike Gauvin for his contribution to this post.  Please email Brian Gibbons with any questions.

Unlimited WC Coverage Prevents Excess Coverage from Being Triggered (NY)

In Vincent & Sons Construction v. Century Surety Insurance, et al, the Second Department recently discussed the unlimited workers compensation coverage interacts with excess policies.

This declaratory judgment action was brought by Arthur Vincent & Sons Construction  seeking defense and indemnification from defendants Century Surety Insurance Company and Admiral Insurance Company in an underlying action wrongful death action, which arose during a project in which Fordham University hired Vincent Construction to install a new roof on one of its research buildings. As part of their contract, Vincent Construction agreed to indemnify Fordham against any claims arising out of Vincent Construction’s negligence and to carry comprehensive commercial general liability insurance naming Fordham as an additional insured.

During the course of the project, one of Vincent Construction’s employees had a fatal accident, and his estate commenced a wrongful death action against Fordham. In turn, Fordham commenced a third-party action against Vincent Construction seeking contribution, common-law indemnification, and contractual indemnification. At the time of the accident, Vincent Construction was covered by three policies: (1) a worker’s compensation and employer’s liability policy issued by Commerce and Industry Insurance Company (“Commerce”) that covered common-law indemnification claims and excluded coverage for contractual indemnification claims, (2) a CGL policy issued by Century that covered contractual indemnification claims, and (3) an excess policy issued by Admiral that also covered contractual indemnification claims.

After learning of the accident, only Commerce acknowledged coverage and provided Vincent Construction with defense, so Vincent Construction commenced this action to obtain a judgment declaring that Admiral was obligated to defend and indemnify it, and to defend and indemnify Fordham as an additional insured in the underlying wrongful death action.

Admiral moved for summary judgment, arguing that it was not obligated to defend or indemnify Vincent Construction because Vincent Construction’s primary coverage under the Commerce policy was unlimited, so excess coverage could never be triggered. Vincent Construction argued that because the Commerce policy excluded claims for contractual indemnification, the Admiral policy provided it with excess coverage for those claims. The Supreme Court agreed with Vincent Construction, and declared that Admiral must indemnify Vincent Construction in the underlying action with excess, noncontributory coverage. Admiral appealed.

On appeal, the Second Department noted that the Admiral excess policy stated that it provided coverage in the amount of the “ultimate net loss” in excess of the “underlying insurance limit.” The policy defined “underlying insurance limit” as the sum of the amounts of “other insurance” and “underlying insurance.” At issue for the Second Department was the meaning of “underlying insurance,” which the Admiral policy defined as “coverage(s) afforded under insurance policies, for the limits shown, as designated in the schedule of underlying insurance.”  The schedule of “underlying insurance” listed Century’s CGL policy, but it did not list Commerce Workers’ Compensation policy. Despite this, the court explained that the coverage afforded under the Commerce policy was included in the “underlying insurance limit,” because it was considered “other insurance.”

Here, the Commerce policy contained a New York Limit of Liability Endorsement providing Vincent Construction with unlimited coverage in cases where bodily injury to an employee arises in the course of employment. Because there was no question that the facts of the wrongful death action fell within the meaning of the endorsement, Admiral was correct that Vincent Construction’s primary policy provided unlimited coverage. Accordingly, the Second Department reversed the trial court, and held that by its “clear and unambiguous terms” the Admiral excess policy was not could be triggered for the wrongful death suit, regardless of the exclusion for contractual claims.   Admiral’s policy language governed, and the WC carrier is responsible for the entire underlying judgment, whatever that may be.  Thanks to Evan King for his contribution to this post.  Please email Brian Gibbons with any questions.

No Appellate Review on Non-Final Order (PA)

The Superior Court of Pennsylvania recently quashed the appeal of the plaintiff in a Mechanics’ Lien dispute.  In SCE Environmental Group, Inc. v. Spatt, No. 283 MDA 2017 (Jan. 4, 2018), the plaintiff filed a Mechanics’ Lien of $371,424.79 against the defendants after a fire occurred at a property located in Jessup, Pennsylvania.  Plaintiff asserted that a master services agreement contracted for them to perform emergency response work to stabilize the property, as well as other tasks including disposal and removal of a tank on the property.  After allegedly completing the work, plaintiff sent defendants an invoice for $371,424.79.

Plaintiff contends that the defendants did not pay for any of the work performed and that plaintiff qualified as a contractor under the Mechanics’ Lien Law.  Accordingly, plaintiff submitted a mechanics’ lien in the same amount, asserting that, at the time the claim was filed, the defendants were the owners of the property to which the mechanics’ lien attached.  Defendants filed preliminary objections to strike plaintiff’s pleading for lack of specificity and on the basis of an agreement for alternative dispute resolution contained in the agreement.  After an oral argument, the trial court sustained defendants’ preliminary objections and dismissed the plaintiff’s complaint without prejudice for failure to meet the requirements of the Mechanics’ Lien Law.  Plaintiff then filed a notice of appeal from the order sustaining defendants’ preliminary objections.

In reaching its decision to quash the appeal, the Superior Court explained the general rule that only appeals from final orders (i.e. an order that disposes of all claims and of all parties) are subject to appellate review.  The court further explained that, by virtue of dismissing plaintiff’s complaint without prejudice (as opposed to with prejudice), plaintiff was implicitly granted an opportunity to amend the complaint.  However, plaintiff did not file an amended complaint.  Furthermore, the issue at hand did not qualify for interlocutory review because it did not fall under any of the appropriate categories outlined in the Pennsylvania Rules of Appellate Procedure.  Ultimately, the court concluded that it did not have jurisdiction over plaintiff’s appeal because there was no final order nor an appropriate interlocutory issue; therefore the appeal was quashed.

Thanks to Greg Herrold for his contribution to this post.  Please email Brian Gibbons with any questions.

Overly Voluminous Pleadings Result in Dismissal (PA)

On January 4, 2018, the Superior Court of Pennsylvania affirmed preliminary objections which dismissed a pro se plaintiff’s fourth amended complaint after it found he had waived all the issues therein.

On February 23, 2015, the underlying trial court sustained preliminary objections against pro se plaintiff Andreas Schilit’s (“Schilit”) third amended complaint since it was not in a concise and summary form.  Schilit’s third amended complaint contained over 800 paragraphs, mixed causes of action, and cross-referencing counts.  In response, Schilit filed a fourth amended complaint which attempted to remove some of the paragraphs in compliance with the court’s order, but he instead reinserted them in an attached affidavit to the fourth complaint.

More preliminary objections followed to which Schilit filed a fifth amended complaint which was even longer than its predecessors.  The numerous defendants all filed motions to strike claiming that Schilit’s filing was in bad faith and merely an attempt to hurry and harass them.  The court then granted their motions to strike and granted their preliminary objections to the fourth complaint.

On appeal, Schilit file a Rule 1925(b) statement which was twelve pages and 136 numbered paragraphs; in direct contrast to the rule’s requirement for a “concise” statement of appeal.  The Superior Court stated that if a court has to guess on what issues an appellant is raising, then it is not enough for meaningful review.  In addition, the court found Schilit’s brief to be disorganized and rambling and decided that he had waived all issues on appeal.  This case demonstrates the idiosyncrasies of dealing with pro se plaintiffs, forcing defendants to address baseless, but timeconsuming pleadings and evidentiary issues.  Thanks to Peter Cardwell for his contribution to this post.  Please email Brian Gibbons with any questions.

Dance Like No One is Watching, Email Like it will be Read Aloud in Court (NY)

Technological advances often create issues previously undecided by the Courts.  The use of email to contact clients, adversaries and the Court has become increasingly popular, but also comes with a host of discovery and confidentiality issues.

Recently, in Siras Partners v. Activity Kuafu, (1st Dept. 2018), the First Department heard a case regarding the waiver of attorney-client privilege due to the content of emails sent to third-parties that were produced in discovery. The Court found that by emailing a third party about the advice of his attorney, the defendant waived attorney-client privilege not only as to that email, but as to any and all documents related to the content of the email.

While the email was sent before the commencement of the lawsuit itself, the simple fact that advice from the defendant’s attorney regarding the substance of the lawsuit was within the email was sufficient to be a waiver of attorney-client privilege.

The crux of this issue is the content of communication as well as the recipient of that information. The recipient of the email in the Siras case was a business partner and friend of the individually named defendant, which may have been why the defendant was so quick to email communication with his private counsel.

Nevertheless, this decision shows that now, more than ever, it is imperative that attorneys are diligent in monitoring their communication via email and are diligent in warning their clients about the potential pitfalls of sharing confidential and protected information even with their closest family and friends.  And frankly, the title of this post also pertains to emails and texts unrelated to litigation.

Thanks to Dana Purcaro for her contribution to this post.  Please email Brian Gibbons with any questions.

Statue of Limitations not Tolled by Defendant’s Promise to Take Care of Violations (NY)

In Huss v. Rucci Oil Company, the Appellate Division, Second Department, discussed the respective burdens of proof based on a defense involving the statute of limitations, which is then countered by a plaintiff’s claim that equitable estoppel failed to toll the statute.

In this case, the plaintiff brought suit for causes of action sounding in breach of contract and negligence based on defendant’s failure to obtain the necessary permits in its installation of a fuel storage tank at plaintiff’s premises. Defendant moved to dismiss as the June 11, 2015, action was time barred given the accrual of both the breach of contract and the negligence claims on December 19, 2008 when defendant installed the fuel tank.

The lower court denied defendant’s motion as plaintiff had raised the issue of whether the doctrine of equitable estoppel was applicable which would constitute a toll of the limitations period for each cause of action and the defendant has not met its burden in establishing the actual accrual of the action.

Typically, the defendant bears the initial burden of establishing that the time in which to commence the action has expired. The burden then shifts to the plaintiff to raise a question of fact as to whether the statute of limitations is tolled or is otherwise inapplicable. Here, the Appellate Division found that defendant satisfied its initial burden. The burden then shifted to plaintiff to establish that a subsequent specific action by the defendant induced the plaintiff to delay timely bringing suit due to plaintiff’s reliance on the defendant’s misrepresentation.

On these facts, when the first of three violations for failure to obtain necessary permits was issued to the defendant in October 2009, defendant’s service manager informed plaintiff that defendant would take care of that violation. Plaintiff claimed they relied on this representation and that he was unaware that defendant had not in fact cured the violation until a subsequent violation had been issued in July 2013, thus allegedly justifying plaintiff’s delay up until June 2015 in commencing the action.

However, the Appellate Division noted that equitable estoppel will not toll a statute of limitations where a plaintiff possesses timely knowledge sufficient to place a plaintiff under a duty to make inquiry and ascertain all the relevant facts prior to the expiration of the applicable statute of limitations. Where the doctrine of equitable estoppel applies, the burden is on the plaintiff to establish that due diligence was exercised in commencing an action within a reasonable time after the facts giving rise to the estoppel ceased to be operational. The court found that plaintiff did not demonstrate the necessary due diligence because plaintiff could have commenced an action within the more than three-and-one-half years remaining on the six-year breach of contract cause of action and the four months remaining on the three-year negligence statute of limitations when the second violation was issued in August 2011. This violation served to provide plaintiff with timely knowledge of the defendant’s failure to cure the initial violation. Thus, the Appellate Division granted defendant’s motion to dismiss.

Thanks to Sara Matscfhke for her contribution to this post and please write to Mike Bono for more information.

PA Superior Court Applies Fair Share Act to Strict Liability Action

The Pennsylvania Fair Share Act, enacted in 2011, regulates the apportionment of jury verdict awards for liable parties. The Fair Share Act mandates that all defendants are responsible for the share of liability apportioned to them, with the exception that a defendant could be liable for the entire award if found more than 60% liable. In plain English, any defendant with 60% or less allocated liability in a case involving the Fair Share Act is only responsible for its own culpability and cannot be made to satisfy the entire judgement if a portion of the judgment is, for whatever reason, not collectable.

The Fair Share Act unquestionably includes negligence verdict awards but the Pennsylvania Supreme Court and Pennsylvania Appellate Courts , until recently, had yet to weigh in regarding the applicability of the Fair Share Act for strict liability cases sounding in tort actions.

In Roverano v. John Crane Inc, the Superior Court of Pennsylvania dealt with the Fair Share Act within the context of a strict liability asbestos action where plaintiff claimed he sustained lung cancer as a result of exposure to asbestos.  The trial court had decided that the jury could not apportion liability because the case involved strict liability for asbestos exposure.

The Superior Court held that the applicable statute alluded to strict liability for tort cases and only excluded four categories of strict liability actions, implicitly including the balance of strict liability cases sounding in tort. Further, the Court held that strict liability allocation amongst joint tortfeasors was required by the Fair Share Act to be identical to the allocation method for negligent joint tortfeasors. The Court held that was mandated per the legislative intent underlying the enactment of the Fair Share Act. Additionally, the Court held that the clause in the applicable statute “including actions for strict liability” is revealing. Finally, the Court found legislative history instructive as older versions of the bill included “causal negligence” but were replaced in the enacted statute with “liability”, thus allowing an inference of greater inclusion of possible actions.

The Superior Court’s decision means that a “fact-finder [should allocate] liability among joint tortfeasors in all types of cases, including strict liability cases”. The Court specifically declined to weigh in how exactly to allocate liability, but that the liability allocation should not be done on a per capita basis, Revealingly, the Superior Court did note that the jury should consider evidence of any previous settlements with released defendants as part of its liability determination.

Thanks to Matt Care for his contribution to this post and please write to Mike Bono for more information.

WCM Argues Before NY Court of Appeals in Facebook Disclosure Dispute

On January 2, 2018, WCM partner Michael Bono appeared before New York’s highest court to challenge the standard for the production of Facebook information.

In Forman v. Henkin, plaintiff alleges she sustained a traumatic brain injury when she fell from a horse.  As a consequence of this injury, plaintiff alleges that she can no longer participate in many of the actives she previously enjoyed; that she could barely read or compose texts; that writing simple messages on the computer takes hours; that she couldn’t handle using the computer for more than 10 minutes without harming herself; and that her social network went from huge to nothing.

When questioned at her deposition, plaintiff testified that she posted frequently to Facebook before the accident, but was either unable or unwilling to testify about her post-accident Facebook practices, and her account was deactivated shortly after filing the lawsuit.

The defense made a demand to access plaintiff’s Facebook account to challenge her claims, and the trial court held that plaintiff was required to disclose all non-romantic photographs from her private Facebook account and to provide an authorization for Facebook to disclose the number of posts plaintiff made post-accident and the text count of those posts.

Plaintiff appealed, and the First Department held disclosure was not required because the defendant had not met the factual predicate required by prior courts.  Namely, defendant failed to show that there were relevant materials on plaintiff’s public Facebook page in order to establish the demand for records from the private account was reasonably calculated to lead to the discovery of information bearing on the claims.

On appeal, plaintiff has argued this standard is warranted in order to protect privacy and to prevent “fishing expeditions” in all cases where litigants have Facebook accounts.  The defense argued there is no reasonable expectation of privacy in social media accounts where the purpose is to share one’s thoughts and photographs which can be published or disclosed unconditionally by Facebook “friends.”   In addition, the current enhanced standard is not required for any other form of discovery, and disclosure should be warranted where targeted demands are made against specific claims within the context of the litigant’s Facebook practices.

A decision should be published within the next 30-60 days, and we will continue to follow the story on Of Interest.  Please write to Mike Bono for more information.