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Tag Archives: Damages

Expanding Wrongful Death Damages Would Increase Insurance Premiums For All New Jersey Residents

April 12, 2018News, Top StoriesDamages, New Jersey Legislature, Wrongful DeathNJCJI

A bill being considered by the New Jersey Legislature would expand the range of damages that could be awarded under our state’s Wrongful Death Act. If passed into law, it would increase insurance premiums for all New Jersey residents by making lawsuits more expensive and difficult to settle.

 

S1766, which is being sponsored by Sens. Scutari and Gill, would expand New Jersey’s Wrongful Death Act to allow unlimited recovery for emotional damages. Scutari, who chairs the Judiciary Committee, refused to hear testimony before having the bill voted out of committee.

 

NJCJI president and chief counsel, Alida Kass, was quoted in the New Jersey Law Journal explaining our opposition to the bill:

 

“The existing [act] works well and already provides for fair and predictable compensation. Changing the scope of wrongful death remedies to include purely emotional damages, like mental anguish and pain and suffering, would introduce considerable uncertainty, making cases more difficult to settle, and imposing significant new risk and increased insurance premiums on all New Jersey residents…

 

“[T]he existing methodology also ensures clarity and certainty—the approach is well-established and honed through years of developing case law,” Kass said. “And by taking the purely emotional aspects out of the calculation, the methodology permits the ready valuation of cases, which is essential to reaching settlements.

 

“Changing the rules to permit awards for what is essentially unquantifiable would undo that fairness and predictability,” she said.

 

The change would also significantly increase the risk and burden on all New Jersey residents. People carry insurance because they recognize that a momentary lapse of judgment can sometimes result in tragic, completely unintended consequences. Everyone benefits from being able to insure against the financial consequences of such a tragic event. Exposing New Jersey residents to an open-ended and unpredictable risk of liability would mean a significant increase in premiums, and still no guarantee that they have adequate protection against a massive jury verdict.

 

There is no amount of money that can fully compensate for the lost life of a loved one. The best that the civil justice system can do is compensate the quantifiable losses – something the existing Wrongful Death Act already does very well. Ask for more than the system can reasonably provide, and we lose the predictability and basic fairness that we largely take for granted. The primary effect will simply be higher premiums, with a largely uninsurable risk that a momentary mistake results in life-altering financial calamity.

 

Click here to read the full NJLJ article.

 

Committees Consider Wrongful Death & Bad Faith Bills

April 6, 2018News, Top StoriesBad Faith, Damages, Insurance, New Jersey Legislature, Wrongful DeathNJCJI

NJ State HouseApril 5 was a busy day under the State House dome. While the halls were swarmed with people up in arms over vaccines and nuclear power, two other bills attracted the attention of NJCJI and our allies in the business community.

 

The Senate Judiciary Committee swiftly passed a bill providing additional damages in wrongful death cases without hearing any testimony, and the Senate Commerce Committee voted to advance a bill targeting the bad faith denial of insurance claims. It would be a big deal if either one of these bills were passed into law, but the combination of the two would send our state’s insurance market into a tailspin. NJCJI is opposing them both.

 

Additional Damages in Wrongful Death Cases    

 

S1766, which is being sponsored by Sens. Scutari and Gill, would expand New Jersey’s Wrongful Death Act to allow unlimited recovery for emotional damages. Scutari, who chairs the Judiciary Committee, refused to hear testimony before having the bill voted out of committee.

 

NJCJI is opposing this legislation because the existing Wrongful Death Act works well and already provides for fair and predictable compensation. Changing the scope of wrongful death remedies to include purely emotional damages, like mental anguish and pain and suffering, would introduce considerable uncertainty, making cases more difficult to settle, and imposing significant new risk and increased insurance premiums on all New Jersey residents.

 

The Wrongful Death Act already provides compensation both for straightforward pecuniary losses like future income, as well as less tangible aspects of loss like lost assistance, care, training, advice, counsel and companionship. The existing legal guidelines ensure clarity and certainty – the approach is well-established and the case law has been honed through the years.

 

By keeping the purely emotional aspects out of the calculation, the existing methodology permits the ready valuation of cases, which is essential to reaching settlements. Changing the rules to permit awards for what is essentially unquantifiable would undo that fairness and predictability. Tasking juries with putting a dollar value on “grief” without any limit or guidance would significantly undermine predictive value of all other calculations, creating wild fluctuations in awards, and that uncertainty in valuing cases would make those cases much more difficult to settle.

 

The change would also significantly increase the risk and burden on all New Jersey residents. People carry insurance because they recognize that a momentary lapse of judgment can sometimes result in tragic, completely unintended consequences. Everyone benefits from being able to insure against the financial consequences of such a tragic event. Exposing New Jersey residents to an open-ended and unpredictable risk of liability would mean a significant increase in premiums, and still no guarantee that they have adequate protection against a massive jury verdict.

 

There is no amount of money that can fully compensate for the lost life of a loved one. The best that the civil justice system can do is compensate the quantifiable losses – something the existing Wrongful Death Act already does very well. Ask for more than the system can reasonably provide, and we lose the predictability and basic fairness that we largely take for granted. The primary effect will simply be higher premiums, with a largely uninsurable risk that a momentary mistake results in life-altering financial calamity.

 

Bad Faith Bill is Bad for New Jersey

 

Although New Jersey already has mechanisms in place that discourage insurance companies from improperly denying claims, supporters of S2144 are urging the state to do more to deter claim denials.

 

The legislation, which is being sponsored by Sens. Scutari and Gopal, would create a private cause of action for claimants who face an “unreasonable delay or unreasonable denial of a claim for payment of benefits under an insurance policy.”

 

Successful claimants would receive:

  • actual damages caused by the violation;
  • prejudgment interest, reasonable attorney’s fees, and all reasonable litigation expenses; and
  • treble damages.

 

On April 5, the Senate Commerce committee held a spirited debate, with Senator Cardinale observing the imbalance of the bill, which would impose treble damages on mistakes by insurance carriers but no comparable penalty on erroneous, or even false, claims made by plaintiffs. The bill was nevertheless voted out of committee.

 

While we appreciate the sponsors’ concern with encouraging fair and efficient behavior from both carriers and claimants when settling cases, expanding the availability of bad faith remedies would not improve the efficiency or fairness of claims settlements. Rather, it would make claims settlements less predictable and more expensive and distort the existing incentive structure to the particular detriment of law-abiding policy holders.

 

The challenge of regulating insurance is striking the appropriate balance of incentives. We want to ensure that policy holders are not subject to undue delay or unnecessary litigation, while at same time protecting carriers’ ability to investigate questionable claims and hold policies to terms on which they are drafted.

 

That balance is critical, because shifting too far towards deterring carriers from policing the terms of insurance contracts is not a benefit to consumers. Policies are priced according to their terms, not just as drafted, but as they are likely to be enforced. If policy limits cannot be enforced in a predictable fashion, then affordable policies with set policy limits will not be available for purchase.

 

The existing framework is designed to strike that balance. When there is no reasonable basis to dispute the claim, individual claimants can currently bring a bad faith claim to recover damages in excess of policy limits. But when carriers have a reasonable basis to dispute a claim, in other words, when the claim is “fairly debatable,” imposing fee-shifting and treble damages on mere mistakes would result in over-deterrence.

 

The goal is to distinguish errors made in good faith from claim denials that arise out of a general business practice to use litigation as a tool to drive down settlement values. Hence the regulatory oversight by the Department of Banking and Insurance, which brings bad faith actions against carriers when there has been a pattern of behavior to indicate bad faith settlement practices.

 

The individual policy holder is also not without effective remedy when he believes his insurance carrier is unfairly delaying or denying a claim. In fact, the offer of judgment rule exists for precisely such situations. The policy holder who makes a settlement offer and is ultimately vindicated by a verdict in excess of 120% of the offer is entitled, not only to damages but also to attorney fees incurred from the time the offer was made.

 

The one-sided super-penalties of S2144 would disrupt the existing balance of incentives. When insurance carriers can no longer effectively investigate and challenge potentially invalid claims, rates will go up, and it will ultimately be consumers who pay the price.

 

Double Trouble

 

New Jersey has come a long way since the days when our insurance rates far outstripped those in our neighboring states, and companies were hesitant to offer certain types of policies at all. Any change to our insurance laws must take into consideration the impact it will have on the broader market and on the legal system. The passage of either or both bills would send shockwaves through the insurance industry, and flood the courts with additional cases.

 

Fraud and Abuse Abound in Asbestos Cases

November 20, 2015News, Top StoriesBankruptcy Trust, Damages, Double Dipping, Legal Reform, Trial LawyersNJCJI

Last year’s eye-opening decision in the case In re Garlock Sealing Technologies, LLC was shocking. We had long suspected that asbestos plaintiffs and their attorneys were gaming the system in order to increase their recoveries, but we had no idea just how big of a problem it was. Garlock showed that mitigating evidence had been withheld in almost all the cases brought against it over the past decade, but was the same thing happening in cases brought against other defendants? Continue reading →

Let Your Legislators Know That Taxation via Litigation Is Wrong For New Jersey

June 24, 2015News, Top StoriesBusiness Climate, Damages, New Jersey LegislatureNJCJI

On Thursday, June 25, the New Jersey Senate will be voting on S3034, which would raise taxes on companies and individuals that have been ordered to pay punitive damages. Continue reading →

Taxation via Litigation Bill is Bad for Business

June 23, 2015News, Press Releases, Top StoriesBusiness Climate, Damages, Legal Reform, New Jersey LegislatureNJCJI

StopTheTaxationViaLitigationBillThis morning Senate Budget and Appropriations Committee is holding a hearing on a bill that would raise taxes on companies and individuals that have been ordered to pay punitive damages. Continue reading →

New Jersey Law Journal Highlights Litigation Largesse

January 30, 2015News, Recent News, Top StoriesDamages, New Jersey CourtsNJCJI

Eye-popping verdicts become less notable when you are besieged by them day after day, but the New Jersey Law Journal’s 2015 Personal Injury Hall of Fame caused us to do a double take. Just twelve cases resulted in over $100 million in payouts.

Click here to see the full list of cases broken down by subject matter.

 

New Jersey’s Consumer Fraud Act Hall of Shame

July 11, 2014News, Top StoriesAttorney Fees, Business Climate, CFA, Civil Justice, Class Actions, Damages, Fee Shifting, Legal Reform, New Jersey Courts, New Jersey Legislature, NJCJI, Outrageous Lawsuits, Regulation via LitigationNJCJI

Hall of ShameNew Jersey’s Consumer Fraud Act has been turned into an instrument through which the plaintiff’s bar plays “gotcha,” turning harmless technical regulatory violations into cases which generate huge attorneys fees, and no real benefit for the consumers supposedly “harmed.” NJCJI is counting down the top 10 most absurd lawsuits filed under the CFA. Continue reading →

Oroho and O’Donnell Introduce Legislation Aimed at Reforming New Jersey’s Consumer Fraud Act

July 11, 2014News, Top StoriesAttorney Fees, Business Climate, CFA, Civil Justice, Class Actions, Damages, Fee Shifting, Legal Reform, New Jersey Legislature, NJCJI, Outrageous LawsuitsNJCJI

The New Jersey Consumer Fraud Act was enacted in 1960 to protect New Jersey citizens against deceptive business practices. As one of the first consumer protection laws in the country, it served as the model for similar legislation in many other states.

 

The CFA was such an effective tool that the legislature and the courts greatly expanded its scope. Today, compliance with the CFA is burdensome, especially for New Jersey’s small businesses. As past lawsuits have demonstrated, the CFA is prone to abuse, incentivizes unnecessary litigation, and makes even technical violations extraordinarily costly to resolve.

 

Sen. Oroho (R-24) and Asm. O’Donnell (D-31) have recognized that it is time to adopt some basic, technical changes that will make the CFA less onerous while still providing strong protections to consumers. Senate Bill 2293 and its companion, Assembly Bill 3497, have been introduced in the New Jersey Legislature to do just that. Continue reading →

NJ Supreme Court Says ‘No’ – Why Pet Owners’ ‘Emotional Distress’ Doesn’t Hold up in Court

August 1, 2012NewsDamages, New Jersey Courts, New Jersey Supreme Court, Outrageous LawsuitsNJCJI

In part, it’s, the human-versus-animal, possession-versus- humankind argument.

 

New Jersey resident Joyce McDougall witnessed her cute Maltese-poodle’s violent death at the hands (paws?) of another dog in Morris Plains.  She filed suit for the cost of a replacement dog, and for emotional distress.

 

A trial court agreed that she should receive more than the cost to replace her pet and issued her $5,000.  But being compensated for emotional distress was reserved for people who witness the violent death of a close family member, they said, based on the 1980 Portee v. Jaffee doctrine.  The New Jersey Supreme Court unanimously upheld that decision this week.

 

In a much-needed reality check, Justice Helen Hoens observed that the vast majority of states do not allow owners to sue for emotional distress when their animals are killed.  And beyond that, the Courts have been very limited in what they consider to be a “close family member” under this doctrine.   The New Jersey Law Journal notes that an appellate court in the 1980s said it did not apply to a woman who saw her 5-year-old neighbor, with whom she was very close, mauled to death by a circus animal (Eyrich ex rel. Eyrich v. Dam, 193 N.J. Super. 244).

 

“It would make little sense, we think, to permit [the] plaintiff to recover for her emotional distress over the loss of her dog when she would be precluded from any such recovery if she instead had the misfortune of watching a neighbor’s child, whom she regarded as her own, torn apart by a wild animal,” Hoens said.

 

And if the Court were to expand Portee to include animals, it would open the floodgates for New Jerseyans to sue for emotional distress after watching heirlooms or other property destroyed, the Justices reasoned.  As if New Jersey needs any help maintaining its status as a Judicial Hellhole…

 

Why we’re opposed to the statute of limitations bill on today’s Senate board list

August 20, 2012NewsDamages, New Jersey Legislature, Statute of LimitationsNJCJI

Child sexual predators exist everywhere.  They harm children from all demographics and shatter families from all socio-economic statuses.  It often takes years for victims to come forward and bring their accusers to justice.  Like most reasonable people, we understand this reality.  And that is why a criminal statute of limitations does not exist in New Jersey, and is not in question.

 

What today’s legislation addresses is the ability of victims to sue for damages.  The civil statute of limitations is a time limit on cases brought by accusers seeking monetary damages from sex abuses or their employers for the abuses they have suffered.  The statute of limitations on these efforts is currently two years from the time a person realizes that they have been injured by sexual abuse, not from the act itself.  Advocates maintain that this window is not long enough.

 

Senator Paul Sarlo and Assembly Majority Leader Lou Greenwald agree.  They have introduced legislation known as the Child Protection Act of 2012, which would bring the civil statute of limitations to 10 years from the time a victim realizes they have been abused instead of the 2 years currently on the books in New Jersey.  And it would hold their employers and supervisors accountable from this point forward.

 

Unfortunately, that is not the legislation that the Senate will be voting on today.  Today’s legislation, S-1651, would completely eliminate the civil statute of limitations in all sex abuse cases.   And it would be applied retroactively, leaving all current board members and officials vulnerable to claims which may or may not have occurred decades ago.  And unlike criminal trials, the burden of proof is much lower in civil cases, so mounting any sort of defense is likely in vain.  The most damning cases would undoubtedly be the ones involving public schools and municipalities, because ultimately, it’s the taxpayer’s dime that will be used to settle claims.

 

Today’s legislation is well-intentioned.  But it takes a step beyond what is rational under the American judicial system.  Child sex abuse victims experience society at its worst.  They shouldn’t have to carry the financial burdens of therapy as they move forward; it is the responsibility of the perpetrator and those who have failed the child.  But the legislation being considered today swings too far in the opposite direction.  New Jersey’s honest charities, volunteers, and taxpayers will be left exposed to a plethora of indefinite, unintended consequences and opportunities for the dishonest to take advantage of the law’s newly-expanded liabilities.  And it’s an expense all of us will bear.

 

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