December 3, 2012
This is a status report provided by the New Jersey State Bar Association on recently passed and pending legislation, regulations, gubernatorial nominations and/or appointments of interest to lawyers as well as the involvement of the NJSBA as amicus in appellate court matters. To access a complete copy of the Capitol Report and/or retrieve prior editions, visit njsba.com.
Action by Gov. Chris Christie
A-2652 (Eustace) SCS for S1926 (Greenstein)/S2022 (Madden) – Bans charging workers' compensation claimants for medical expenses, gives the Division of Workers' Compensation sole jurisdiction over work-related medical claim. The NJSBA strongly supports the measure to clarify that authorized medical providers should not be billing injured workers beyond the payments that those medical providers are receiving from the insurance carrier/respondent.
Now, medical providers require injured workers to sign documents upon their first appearance at the physician’s office, where the patient/injured worker agrees to pay medical fees to the medical provider above and beyond those fees agreed upon between the medical provider and the respondent/insurance carrier. This bill will put an end to the practice.
Second, the bill specifically designates the Workers’ Compensation Court as the sole forum for resolution of medical provider issues in work-related medical claims. This is appropriate, as the Workers’ Compensation Court is the court of original jurisdiction and the court with the expertise to best address these issues.
Lastly, medical provider issues are addressed in either the Superior Court or the Workers’ Compensation Court. This leads to confusion and the potential of divergent conclusions to any medical provider issue. The NJSBA believes it is in the best interest of the courts and the injured worker to have these medical provider issues addressed in one forum, the Workers’ Compensation Court.
AJR-26 (Chivukula)/SJR-54 (Gordon) – Designates each May as Asian Pacific American Heritage Month
A-3096 (Gusciora)/S2169 (Turner) – Conditional - Establishes conditional dismissal program in municipal court; alters eligibility requirements and increases fees for existing conditional discharge and supervisory treatment programs. The Governor issued a conditional veto raising concerns regarding fees to establish the conditional dismissal program at $500 and new fee increases for the pretrial intervention program and conditional discharge programs of $350. Instead, the Governor recommends that fees for the conditional dismissal program, the pretrial intervention program, and the conditional discharge program should be $75.
The NJSBA strongly supported this bill with amendments, which established a conditional dismissal program in municipal court and altered eligibility requirements and increased fees for existing conditional discharge and supervisory treatment programs.
The NJSBA’s Board of Trustees, Legislative Committee and Municipal Court Practice Section supported this legislation with amendments because it would fix a long-standing inequity in the municipal court system. Presently, pre-trial intervention (PTI) is only allowed for indictable offenses. Therefore, for example, if you are charged with theft over $500, you qualify for PTI, which allows you to be diverted from the criminal system before conviction. However, if the theft charge is less than $500, you do not qualify for PTI because it is not indictable. In some instances, such as in the case of public employees, acceptance into PTI can preserve employment, while a conviction would mean the loss of employment. Thus, we strongly support creating an alternative such as conditional discharge to address these circumstances.
In 2003, the American Bar Association adopted a report entitled “Collateral Sanctions and Discretionary Disqualification of Convicted Persons” which urged legislatures throughout the country to review their criminal code to ensure that the penalties associated with violations are not so insurmountable that it becomes difficult for people convicted to reintegrate into society after serving their sentence or paying the fines. The NJSBA embraced these findings as a part of its longstanding position in opposition to arbitrary or excessive fees and surcharges for motor vehicle penalties. For this reason, we do not believe that the exorbitant fees associated with the controlled dangerous substance conditional discharge program should be extended to this program (unless the Drug Enforcement and Demand Reduction penalty of $500 is deleted) since the penalty is presently $800.
Finally, the NJSBA believes that Section 5 of the bill should be amended to read "shall terminate" rather than "may terminate". This is important in order to make it clear that failure to abide by the conditions of the conditional discharge program will result in termination of the program’s benefits.
Animal Law Section
S-1303 (Bateman) - Revises penalties for animal cruelty, increasing degree of certain offenses; designated as Patrick's Law. On November 19, the bill was received and referred to Assembly Agriculture and Natural Resources Committee.
Banking Law Section
A-339 (Watson Coleman) - Codifies the Judiciary's Foreclosure Mediation Program; dedicates monies from foreclosure filing fees and fines. On November 19, the bill was released from Assembly Housing and Local Government Committee and is awaiting Assembly vote.
Business Law Section
S-2326 (Gill) - Revises law concerning derivative proceedings and shareholder class actions. On November 19, the bill was introduced and referred to Senate Commerce Committee.
S-2327 (Gill) - Allows corporate shareholder meeting participation by remote communication and clarifies remedies for dissenting shareholders. On November 19, the bill was introduced and referred to Senate Commerce Committee.
Civil Trial Bar Section
A-3434 (Singleton) - Provides private cause of action for bad faith in settlement of insurance claims. On November 19, the bill was introduced and referred to Assembly Financial Institutions and Insurance Committee
The NJSBA strongly supports this legislation. The purpose of the bill is to permit first-party claimants to file a civil action against their insurers for violation of the Unfair Claims Settlement Practices Act.
New Jersey has a strong public policy against fraud in motor vehicle accident claims. The Automobile Insurance Cost Reduction Act of 1998 instituted many procedures to combat fraud by claimants and medical provides, including the creation of the Office of Insurance Fraud Prosecutor and the requirement that every carrier operate a special investigation unit. Nonetheless, the Legislature has not adopted any equivalent laws to combat bad faith by insurance companies.
In Miglicio v. HCM, 288 N.J. Super 331 (Law Div. 1996), the court held that a violation of the Unfair Claims Settlement Practices Act creates a standard of care for insurance companies in the resolution of claims and that “any deviation from the standards may be considered as evidence of bad faith.” This bill extends that decision and creates a private cause of action for first-party insureds when their insurance companies engage in bad faith practices. This cause of action is consistent with the public policy of New Jersey and balances the similar cause of action that insurance companies have against fraudulent claimants.
Consumer Protection Law Committee.
S-2304 (Sweeney) - Consumer Electronics Warranty Lemon Law. On November 19, the bill was introduced and referred to Senate Commerce Committee.
Criminal Law Section
A-3254 (Coughlin) - Permits municipal court to order certain offenders to perform community service in lieu of payment of penalty. On November 19, the bill was released from Assembly Judiciary Committee and is awaiting Assembly vote.
Elder & Disability Law Section
S-2238 (Allen) - Makes various revisions to laws concerning disabled person identification cards and placards related to parking privileges. On November 19, the bill was released from Senate Transportation Committee and is awaiting Senate vote.
S-2241 (Weinberg) - Prohibits Medicaid managed care organizations from reducing certain provider reimbursement rates without approval from DHS. On November 19, the bill was released from Senate Budget and Appropriations Committee with amendments and is awaiting Senate vote.