Bill Would Ban Punitive Damages Against NJ Public Entities

A bill currently under consideration in the New Jersey Assembly would ban punitive damages against public entities. It would also eliminate awards of noneconomic damages against both public entities and public employees except in certain cases involving physical injury.  Specifically, Assembly Bill No. 4252 amends the New Jersey Tort Claims Act and the Punitive Damages Act by:

• Eliminating awards of punitive damages against public entities, as well as clarifying that public entities shall not indemnify public employees with respect to any such employee liability for punitive damages; and

• Eliminating awards of noneconomic damages (such as pain and suffering, or emotional impairment) against both public entities and public employees, except for cases involving physical injury when the medical treatment expenses are in excess of $10,000.  The medical treatment threshold is currently set at $3,600. The proposed legislation would increase the threshold dollar amount as well as expand its application to all noneconomic damages.

As noted in the statement accompanying the bill, existing provisions in the State’s Tort Claims Act generally restrict or prohibit such damage awards. However, the New Jersey Supreme Court has held that plaintiffs are authorized to pursue punitive damages and damages for noneconomic losses against public entities and public employees under other statutes, such as the New Jersey Law Against Discrimination (LAD) or Conscientious Employee Protection Act (CEPA). Accordingly, the bill provisions intend to “overturn this Supreme Court precedent and establish that the restrictions or prohibitions set forth in the New Jersey Tort Claims Act, which are specifically applicable to public entities and public employees, supersede the general availability of such damages under the common law, the above enactments, or any other statute.” The proposed legislation is currently pending before the Assembly Judiciary Committee. We will closely monitor its status and provide updates as they become available. For more information about the proposed legislation or the legal issues involved, we encourage you to contact a member of Scarinci Hollenbeck’s Government Law Group.