Van Dunk v. Reckson Associates Realty Corp., A-69 September Term 2010; Supreme Court; opinion by LaVecchia, J.; decided June 26, 2012. On certification to the Appellate Division, 415 N.J. Super. 490 (App. Div. 2010). [Sat below: Judges Stern, Graves and Newman in the Appellate Division; Judge Martinotti in the Law Division.] DDS No. 39-1-6771 [40 pp.]

Plaintiff Kenneth Van Dunk was working for defendant James Construction Company Inc. as a laborer on a construction project in Chatham Township. James had contracted with defendants Reckson Associates Company Inc. and Reckson Construction. L.L.C., to perform site-preparation work. Glenn Key was the project superintendent.

On the day of the accident, James was excavating a trench to relocate a dewatering sump in a retention pond. The relocation involved digging a sloped trench, laying down filter fabric and stone, and then placing a pipe in the trench. OSHA safety regulations mandate that workers cannot enter a trench that is deeper than five feet if protective systems to protect employees from cave-ins are not in place.

The workers experienced difficulty when laying down the filter fabric from outside the trench. Eventually, in “frustration,” Key told Van Dunk to go in and straighten the fabric. Less than five minutes after Van Dunk went into the trench, a wall caved in, seriously injuring him.

Key acknowledged to OSHA investigators that he knew the OSHA requirements and did not follow the standard for using a protective box for the trench’s depth and category of soil type. Also, there was no dispute that the sloping did not satisfy OSHA requirements. The OSHA report concluded that James committed a willful violation and assessed a fine.

Van Dunk filed this action against Reckson and James for damages arising out of his injuries. The trial court granted defendants summary judgment, concluding that plaintiff failed to show that their conduct met the intentional-wrong standard for overcoming the exclusivity of the workers’ compensation remedy. The Appellate Division reversed. James’ petition for certification was granted.

Held: Although a reasonable fact finder could determine that the employer’s actions constituted gross negligence, that showing is not enough to overcome the act’s exclusivity requirement. Neither the conduct nor the context prongs of the Millison substantial-certainty test is satisfied here. Thus, the act’s statutory bar precludes plaintiff’s common-law tort action against his employer.

The court says New Jersey’s Workers’ Compensation Act, N.J.S.A. 34:15-1 to -128.5, provides a prompt and efficient remedy for an employee’s claim against an employer for a workplace injury. The Legislature made the statutory workers’ compensation remedy its preferred mechanism for providing compensation to injured workers. The act’s remedy is exclusive, except for injuries that result from an employer’s “intentional wrong.” For those, 34:15-8 permits an injured employee to maintain a common-law tort action against the employer.

The landmark case interpreting “intentional wrong” is Millison v. E.I. du Pont de Nemours & Co., 101 N.J. 161 (1985). It adopted a “substantial certainty” standard and a two-step analysis. First, under the conduct prong, a court must examine the employer’s conduct in the setting of the particular case. Second, under the context prong, a court must consider whether the resulting injury or disease, and the circumstances in which it is inflicted, may be viewed as a fact of life of industrial employment or whether it is plainly beyond anything the Legislature could have contemplated as entitling the employee to recover only under the act.

The court then turns to the Occupational Safety and Health Act of 1970, 29 U.S.C.A. §§ 651 to -78, which authorized the secretary of the Department of Labor to establish administrative regulations setting employment-safety standards and to make inspections to assess employer compliance with those regulations. The court says the finding of an OSHA violation is one factor among the totality of circumstances to be considered regarding whether the employer committed an intentional wrong, notwithstanding the categorization of a violation as willful. Here, the finding of a willful OSHA violation is not dispositive of whether James committed an intentional wrong and is insufficient to defeat its motion for summary judgment.

The court then turns to the conduct and context prongs of the substantial-certainty standard.

It says mere knowledge by an employer that a workplace is dangerous does not equate to an intentional wrong, which must amount to a virtual certainty that bodily injury or death will result. A probability, or knowledge that such injury or death “could” result, is insufficient. The court says the events that transpired do not equate to the more egregious circumstances involving intentional and persistent OSHA safety violations that have defeated an employer’s motion for summary judgment on the conduct-prong analysis. Key made a quick but extremely poor decision “out of frustration” with unfolding circumstances that morning. This was an exceptional, not an intentional, wrong. It cannot be concluded that there was an objectively reasonable basis for concluding that the violation of safety protocol was substantially certain to lead to injury or death during the few minutes plaintiff was going to be in the trench. Plaintiff did not satisfy the conduct prong.

As to the context prong, the court says it cannot reasonably conclude that the employer’s mistaken judgment and ensuing employee accident were so far outside the bounds of industrial life as never to be contemplated for inclusion in the act’s exclusivity bar.

Chief Justice Rabner and Justices Albin, Hoens and Patterson and Judge Wefing, temporarily assigned, join in Justice LaVecchia‘s opinion.

For appellant — George J. Kenny (Connell Foley). For respondents — Glenn M. Gerlanc (Parisi & Gerlanc; Gerlanc and Steven M. Davis on the brief).