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What's Hot in Workers' Comp

Appellate Division reverses Superior Court’s order, vacates the transfer order, and remands the case to enter an order denying motion to dismiss.

Smith v. Twp. of S. Hackensack, et al., No. A-3258-20 (App. Div. Feb. 18, 2022)

April 1, 2022

by Kiara K. Hartwell

Under the New Jersey Workers’ Compensation Act, “each and every member of a volunteer fire company doing public fire duty . . . who may be injured in line of duty shall be compensated.” The plaintiff, a volunteer firefighter, was struck by a defendant’s fire truck that was in use to bar hop. The plaintiff filed this personal injury suit against the defendants. In November 2020, the defendants moved to dismiss for lack of subject matter jurisdiction and claimed the plaintiff’s sole remedy is workers’ compensation. The motion judge denied that the court lacked subject matter jurisdiction, but noted the Division of Workers’ Compensation had primary jurisdiction and transferred the case. The plaintiff moved for reconsideration or leave to appeal, but was denied. 
 
The Division’s computer system would not recognize the motion judge’s transfer order. Unless the plaintiff voluntarily filed for benefits in workers’ compensation court, the case could not be adjudicated. As the plaintiff did not wish to do so, he moved for reinstatement of his complaint with the trial court. This was denied, but the judge did write to the Division regarding the transfer order. Again, the supervising judge of the Division reiterated the case could not move forward without a petition for benefits. Again, the plaintiff moved for reinstatement of his complaint and was denied, noting the plaintiff could file a petition under court direction, which would not be deemed an admission. The plaintiff filed a notice of appeal. 
 
The Appellate Division found the judge erred in referencing the primary jurisdiction doctrine. Rather, there were comments by the Supreme Court in which both the Division and the Superior Court have authority to consider jurisdiction and employment issues. The Appellate Division noted there were four grounds for invocation of the primary jurisdiction doctrine, including the matter is “often determined by trial judges and juries,” the Division may be “best suited,” though the Superior Court is also familiar with the issue, there is no risk of inconsistent rulings, and the plaintiff declined to file a petition with the Division. However, the plaintiff declined to file a petition with the Division. As these factors weigh in favor of the plaintiff, the Appellate Division concluded the judge abused her discretion. It was noted the Division does not have exclusive jurisdiction and the trial judge should not have assigned the task of deciding personal injury damages to the Division. The order under review was reversed, the transfer order vacated and the matter remanded to enter an order denying the defendants’ motion to dismiss.
 

What’s Hot in Workers’ Comp 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. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2022 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact tamontemuro@mdwcg.com.

Firm Highlights

Thought Leadership

Pennsylvania Supreme Court Takes Up the Gist of the Action Doctrine

The gist of the action doctrine has been a hot topic in legal malpractice cases in Pennsylvania over the last several years.  Beginning in 2014, the Pennsylvania courts applied the gist of the action doctrine to professional liability actions, following the Pennsylvania Supreme Court’s opinion in Bruno v. Erie Ins. Co., 106 A.3d 48 (Pa. 2014).  In Bruno, the court applied the gist of the action doctrine to a professional negligence claim, and found that a negligence claim was not barred simply because the parties were in a contractual relationship where the gist of the claim sounded in negligence. Thereafter, courts in Pennsylvania applied the gist of the action doctrine to breach of contract claims as well, finding that where the allegations sounded in negligence, a plaintiff could not recast a negligence claim as one for breach of contract. This was important because of the distinction between statutes of limitations: negligence claims must be brought within two (2) years, while breach of contract claims can be brought within four (4) years.  Then, last year, the Pennsylvania Superior Court held that the gist of the action doctrine does not apply to breach of contract claims as seen through two opinions. These opinions were Swatt v. Nottingham Village, 342 A.3d 23 (Pa. Super. 2025) and Poteat v. Asteak, et al., 350 A.3d 198 (Pa. Super. 2025). That is, the gist of the action doctrine can bar a negligence claim but it cannot bar a breach of contract claim.  This month, the Pennsylvania Supreme Court granted the petition for allowance of appeal in Poteat.  The Supreme Court phrased the issue for consideration as follows: Whether the Superior Court majority’s holding conflicts with this Court’s holding in Bruno v. Erie Insurance Co., 160 A.3d 48 (Pa. 2014), as well as Superior Court opinions that applied Bruno, and departs from almost 200 years of controlling precedent that distinguishes between causes of action in contract and tort based upon the nature of the duty that was allegedly breached? Attorneys on both sides of legal malpractice matters no doubt look forward to clarification on these issues from our Supreme Court.

Thought Leadership

Appellate Division Affirms Dismissal of Legal Malpractice Counterclaim Against Martin Law Firm

In Martin v. Loury, 2026 N.J. Super. Unpub. LEXIS 1617 (App. Div. July 15, 2026), Martin Law Firm represented Kirk Loury in an employment matter Mr. Loury filed against his former employer, Concord Equity Group Advisors LLC (“Concord”). The allegations included, among other things, that Loury was not fairly compensated for his employment with Concord. After a bench trial finding in Loury’s favor, the Appellate Division remanded this matter in February 2016 for a second trial. During the second trial, Concord CEO, Lee Argush, testified to lower compensation estimate than first trial. On remand, the second trial judge awarded Mr. Loury the same damages as the first judge, finding Mr. Argush not credible. After the findings during the second trial, Martin Law Firm filed an action against Mr. Loury to recover legal fees and costs of representing Mr. Loury in a second bench trial and Mr. Loury filed a counterclaim against Martin Law Firm for legal malpractice, alleging he should have received an even higher award in the second bench trial. In this allegation, Mr. Loury, through his expert, claimed that Martin Law Firm should have recalled Mr. Loury to the stand to rebut Mr. Argush’s testimony to allege an alternative theory of damages. Mr. Loury’s expert admitted that the second judge already rejected Mr. Argush's theory and accepted Loury's damages theory. The trial court barred Mr. Loury’s expert and dismissed Loury's counterclaim with prejudice before convening the collection trial, and the jury ruled in Martin Law Firm’s favor. Mr. Loury appealed the trial court's pretrial rulings barring his liability expert from testifying in support of his legal malpractice counterclaim, denying his motion for summary judgment on that counterclaim, and denying his motion to amend his counterclaim by adding attorney Joseph A. Martin as a codefendant. In affirming the trial court’s decision, the Appellate Division held that the trial court properly excluded Loury’s expert testimony in the counterclaim against Martin Law Firm because the expert could not explain how calling Loury as a rebuttal witness would have increased damages when the second judge already rejected Mr. Argush's testimony and accepted Loury's damages theory, making the expert’s causation opinion speculative. The Appellate Division also held that the trial court properly denied Mr. Loury's summary judgment motion on his malpractice counterclaim because reasonable minds could differ on whether Mr. Martin's alleged failures would have changed the second judge's damages award, given the judge already found Mr. Argush not credible, creating genuine factual disputes precluding summary judgment. Also, the Appellate Division held that the trial court properly denied Loury's May 2023 motion to add Joseph Martin individually because the statute of limitations expired in February 2022, six years after the 2016 appellate remand when Mr. Loury incurred new legal costs, and relation back did not apply because Mr. Loury knew Mr. Martin's identity throughout and strategically chose to sue only Martin Law Firm in his 2019 counterclaim.

Thought Leadership

Delaware Superior Court Clarifies Pleading Standard for Legal Malpractice Claims

In the matter of Edelstein v. Kirschner, No. N25C-09-018 FJJ, 2026 Del. Super. LEXIS 45, at *1 (Super. Ct. Jan. 29, 2026), the plaintiff law firm sued its former client for unpaid legal fees in the amount of $4,399.35. The former client asserted a counterclaim alleging legal malpractice. More, specifically, the former client claimed that his lawyer committed malpractice be recommending that he settle an underlying lawsuit by entering into a stipulated judgment for an excessive amount with interest that was accruing at “an outlandish” interest rate. The law firm moved to dismiss the counterclaim on the basis that its former client had not alleged facts reflecting that he could prove the case within the case. That is, facts reflecting that his attorneys caused him to lose the underlying case. The Superior Court held that while a legal malpractice plaintiff in cases arising from underlying litigation must prove the case within the case to survive a summary judgment motion, he does not need to plead facts reflecting as much in order to survive a motion to dismiss. While this case addresses the pleading requirements of a legal malpractice case in Delaware, it also serves as reminder that chasing unpaid legal fees from a former client can often give rise to a legal malpractice counterclaim. Attorneys seeking to collect unpaid legal fees should ensure that the fees they seek are for a significant amount, which would be recoverable if a judgment is obtained. Otherwise, the effort could backfire.

Result

No-Cause Jury Verdict Secured in Wrongful Death Trial

We successfully obtained a no-cause jury verdict in a 13-day wrongful death trial. The decedent, a 59-year-old man, was admitted to the emergency room on February 15, 2019, with complaints of abdominal pain, decreased appetite, and constipation, despite the use of laxatives. The patient did not complain of any nausea, vomiting, or diarrhea. He had a significant medical history including diabetes, hypertension, prior coronary artery stenting, morbid obesity (with past gastric bypass surgery), longstanding ventral hernia, and back pain. A CT scan revealed multiple hernias and a potential closed-loop bowel obstruction, leading to a surgery consultation. Our client, an emergency general surgeon, interpreted that the patient did not have a closed loop or any significant obstruction and recommended non-surgical management. The patient was approved to have clear liquids, and had a vomiting incident shortly after, but our client was not notified. The patient was returned to NPO status, and after improving overnight, he was returned to “clears” and additional medical and renal consults were ordered. Our client did not receive any communications from the residents/nurses of any changes in the patient’s condition. On February 18, 2019, two rapid responses were called due to increased heart rate and vomiting. It is believed that the vomiting resulted in aspiration, causing sepsis, ultimately leading to the patient’s death. During the trial, the plaintiff’s sole medical expert highlighted imaging on the wrong hernia, which called into question all of his opinions in the case. We made key objections related to the expert testimony, limiting what the allegations were, and preventing new allegations from being made. After approximately two and a half hours of deliberating, the jury returned a no-cause verdict.