New Jersey State Bar Association - The voluntary Bar Association of New Jersey, serving members since 1899.

Captiol Report

August 6, 2012

 

This is a status report on recently passed and pending legislation, regulations, gubernatorial nominations and/or appointments of interest to lawyers. The report may also include information about appearances of NJSBA representatives before legislative committees, and the involvement of the NJSBA as amicus in appellate court matters. The government affairs department of the association compiles the report. Following each bill number is the sponsor’s name, the NJSBA position, if any, bill description and status. Full and previous versions of the Capitol Report with links to related text are available online at www.njsba.com.

 

Special Edition

This special edition of the Capitol Report is the first of a series of reports summarizing the progress of NJSBA priority legislation since the beginning of the current legislative session.

 

On the Governor’s Desk

 

BUSINESS LAW

 

A-1543 (PDF) (McHose) (NJSBA supports) (NJSBA-drafted) Creates the Revised Uniform Limited Liability Act (RULLCA). The limited liability company (also known as the LLC) is a relatively new form of unincorporated business entity. It was first introduced into the United States when Wyoming adopted an LLC statute in 1977. However, its popularity began to explode in 1997 when the Internal Revenue Service eliminated the tax classification issues that had plagued the LLC. Starting in 1997, per so-called “check the box” regulations, an unincorporated business entity may choose to be taxed either as a partnership or a corporation (special treatment applied to single-member entities). Thus, a limited liability company can combine the limited liability of a corporation with the pass-through tax treatment of a partnership. As a result, LLCs have become the business entity form of choice for new businesses, and it is believed more New Jersey LLCs were formed in 2008 than corporations and limited partnerships combined. This is consistent with other states’ experiences. The NJSBA urges New Jersey to adopt a modern statute such as the RULLCA to help New Jersey resurrect its reputation as a good state to do business in, and without any cost to its taxpayers.

Status: On June 21, A-1543 substituted for S-742 (Sarlo), passed in the Senate (38-0), and was sent to the governor.

ELDER AND DISABLITY LAW

 

S-1755 (PDF) (Madden) (NJSBA supports) (NJSBA-drafted) Establishes the Uniform Adult Guardianship and Protective Proceedings Jurisdiction Act. The NJSBA Board of Trustees, Legislative Committee and Elder Law Section voted to endorse this legislation because it helps standardize important jurisdictional issues with respect to adult guardianships, conservatorships, and other protective proceedings, providing an effective mechanism for resolving multi-state jurisdictional disputes. It contains specific guidelines to specify which court has jurisdiction to appoint a guardian or conservator for an incapacitated adult. The objective is that only one state will have jurisdiction at one time. The bill was completed by the Uniform Law Commission and has been adopted in Alaska, Colorado, Delaware, Utah, the District of Columbia, and Missouri. The bill is pending introduction in approximately 25 states. The NJSBA has, in the past, endorsed other uniform laws that can help standardize issues that are likely to engender multiple jurisdictions.

 

Status: On June 21, S-1755 substituted for A-2628 (Rudder), passed in the Assembly (77-0), and was sent to the governor.

 

JUDICIAL ADMINISTRATION

 

A-763 (PDF) (Barnes) (NJSBA supports) Authorizes the Judiciary to revise and supplement court filing fees and other statutory fees to fund a statewide digital e-court information system, to fund Legal Services of New Jersey, and to fund other justice-related programs. The NJSBA has long advocated for full funding of the New Jersey courts so the Judiciary can accomplish its constitutional mission of providing access to justice for New Jersey’s many citizens. In 2009, the NJSBA endorsed the expansion of e-filing in the courts on a statewide basis with the caveat that it not be funded by filing fee increases. Likewise, the NJSBA has been a longstanding supporter of funding for Legal Services of New Jersey, advocating before the state and federal legislatures for enhanced appropriations.

 

Status: On June 25, A-763 substituted for S-2062 (Sweeney), passed in the Assembly (48-30-1), and was sent to the governor. On June 26, the governor conditionally vetoed the bill.

 

Pending Legislation

 

ADMINISTRATIVE LAW

 

A-1521 (PDF) (Burzichelli) (NJSBA supports) Modifies the process for contested case hearings by the Office of Administrative Law (OAL) with regard to telephone and video conferences, delegation of final decision authority, oral decisions, checklist decision, electronic filings, and settlements. The NJSBA supports empowering administrative law judges with the authority to render a final decision, pursuant to the Administrative Procedures Act (APA). The NJSBA can no longer support a system of justice where one party, in a contested matter, has the ability to overrule a judge once a decision has been rendered at the conclusion of a hearing. This is currently the situation for attorneys who practice before the OAL, and it unfairly limits an attorney’s ability to fully and properly represent and counsel clients.

Status: On June 7, bill was released from the Assembly Regulatory Oversight and Gaming Committee and is awaiting Assembly vote.

AUTOMOBILE REPARATIONS

 

A-871 (PDF) (Chiusano) (NJSBA opposes) Requires "permanent injury" under the limitation on lawsuit threshold to seriously impact the life of an injured person to pierce the threshold. Historically, the NJSBA has opposed legislation that limits access to the courts to individuals because of economic status, including the verbal threshold. The NJSBA believes a close examination of the automobile insurance industry would reveal that the average consumer is painfully unaware of the terms and conditions of their coverage, opting often for cost reductions over preservation of their legal rights. Typically, consumers are automatically presented with the limitation on lawsuit option, and they must reject that option to preserve their rights. Moreover, industry agents were given statutory immunity, and are thus held harmless to consumers.

Status:
The bill is pending review in the Assembly Financial Institutions and Insurance Committee.

A-1601 (PDF) (Bramnick) (NJSBA supports) Provides that the limitation on lawsuit option does not apply in an accident caused by a drunk driver. New Jersey’s No Fault Act provides several defenses that limit or bar the damages an accident victim can recover from a tortfeasor. However, in Woodworth v. Joyce, 373 N.J. Super. 113 (App. Div. 2004), the court held that the same restrictions do not apply to a defendant. Thus, a defendant who is convicted of or pleads guilty to driving while intoxicated (DWI) is still entitled to assert the defense of the verbal threshold. The purpose of this bill is to reverse the effect of Woodworth v. Joyce, and to provide that a person who is convicted of or pleads guilty to operating a motor vehicle while intoxicated shall not be permitted to raise the verbal threshold as a defense. The state of New Jersey has a strong public policy against persons who drive while intoxicated. As a result, drunk drivers lose all rights to sue for economic or noneconomic damages if they are injured in an automobile accident. It is equally important that drunk drivers suffer the consequences of their actions when they are defendants in a lawsuit, and not benefit from the protection offered by the No Fault Act. Thus, defendants who are convicted of or plead guilty to DWI should not be entitled to raise the verbal threshold as a defense.

Status: The bill is pending review in the Assembly Financial Institutions and Insurance Committee.