The Appellate Division Weakens Workers’ Compensation Dismissal Orders

Based on its recent decision in Raul Planes v. Village Townhouse, 2014 N.J. Super. Unpub. LEXIS 2784 (N.J. Super. Ct. App. Div. Nov. 25, 2014), the New Jersey Appellate Division has seemingly weakened dismissal orders in workers’ compensation proceedings based on lack of prosecution. New Jersey workers’ compensation proceedings, unlike in most other jurisdictions, do not have a specific time requirement for the parties to complete pre-trial discovery. However, if a petitioner fails to provide timely responses to interrogatories or requests for production of documents, fails to provide medical treatment records or fails to attend the respondent’s medical evaluation, a respondent can file a motion to dismiss for lack of prosecution under N.J.S.A. 34:15-54 (Section 54).

If granted, the dismissal is entered “without prejudice,” which allows the petitioner to move to restore the case for “good cause.” If the petitioner does not move to restore the case within one year from the original dismissal date, the dismissal is then considered “with prejudice,” and would bar a later motion to restore the case. In practice, dismissal orders for lack of prosecution are difficult to obtain. They are usually granted only for extreme delays in providing discovery responses or for the petitioner’s failure to attend multiple medical evaluations.

In Planes, the parties entered into an initial order approving settlement on December 18, 2000. The petitioner then filed an application for review and modification of the period award on August 5, 2002. After almost seven years of delays, the case was dismissed for lack of prosecution on March 26, 2009. The case was restored in October 2009, after which the petitioner underwent several surgeries and obtained medical treatment for various conditions, including diabetes. Although not specifically stated in the opinion, it appeared that the subsequent medical treatment was unrelated to the work injury.

For the second time, the case was dismissed for lack of prosecution—on December 16, 2010. In the order, the Judge inserted a notation, “[the] case not to be restored unless P.A. is ready to settle or try.” The petitioner filed a new motion to restore on May 17, 2012. Following oral argument and briefs, the Judge denied that motion on June 20, 2013. The court’s opinion focused on, among other things, the Judge’s statement that “[i]t is very clear that we are a statutory court” and that he lacked “[a]ny authority under Section 54 to extend the one-year statute.” An appeal followed.

On appeal, the petitioner made two arguments. First, that the workers’ compensation court has the inherent authority to reopen a case where appropriate, notwithstanding the statutory one-year limitation. Second, that the Judge abused his discretion in adding a requirement that the petitioner be ready to settle or try the case as a condition to restoration, and then denying the petitioner’s motion as untimely.

In its analysis, the Appellate Division did not focus on the lengthy delays by the petitioner but, rather, on the Judge’s failure to grant an adjournment request for the December 16, 2010, hearing. Without citing a supporting reference, the Appellate Division indicated that the adjournment request should have been granted.

Similarly, the Appellate Division took issue with the additional provision of the second dismissal order requiring that the case be ready to proceed before a restoration would be granted. However, there was no reference in the court’s opinion that an appeal was filed by the petitioner to the second dismissal order.

Ultimately, the court went outside the workers’ compensation statute to reverse and remand the denial of the restoration. Specifically, the Appellate Division cited the catch-all provision of Court Rule 4:50-1(f), which allows equitable relief from a dismissal order “for any other reason justifying relief from the operation of the judgment or order.” The Appellate Division even added an additional element that required the respondent to show it was prejudiced by the petitioner’s untimely filing of the motion to restore. Such an element is not required under Section 54.

Although not a published decision, the court’s opinion is troubling for respondents on several grounds. While the court’s initial analysis discusses the importance of diligent prosecution of claims and the legislative policy of expeditious litigation, the court ultimately stretched to the catch-all provision of the Superior Court Rules, which specifically do not even apply to workers’ compensation cases, to allow the case to be restored once again. All the while, the court seemed to minimize the most important fact to the Workers’ Compensation Judge, that almost twelve years had elapsed from the time of the original settlement order until the time the petitioner was finally “ready” to proceed in May of 2012. Moreover, the court’s reference to the Superior Court requirement that a respondent should have to show prejudice in order to defeat a late restoration motion, when no such requirement exists in the workers’ compensation statute, smacks of judicial legislation. In the end, this decision seems to strip the workers’ compensation system of any discretion in enforcing the plain language of Section 54, even in the most extreme cases of delayed proceedings. Time will tell whether this decision will have a further negative impact on a respondent’s ability to efficiently dispose of workers’ compensation claims as actually intended by Section 54.

*Bob, a shareholder in our Cherry Hill, New Jersey office, can be reached at 856.414.6009 or rjfitzgerald@mdwcg.com.

^{Defense Digest, Vol. 21, No. 1, March 2015}

^{Defense Digest is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Copyright © 2015 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. This article may not be reprinted without the express written permission of our firm.}