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New Jersey business law allows people and businesses to manage their relationships by entering contracts which define the terms of that relationship.  Contracts are enforceable by the full force of the law.  For instance, if one party owes another money under a contract but doesn’t pay, the wronged party can go to court; if it can prove its case the court will enter a judgment in its favor and it can then have the county sheriff go seize the breaching party’s property to pay the debt.

In some cases, all or part of a contract may not be enforceable.  This area of New Jersey business law contains three distinct and important concepts: void contracts, voidable contracts, and severability.

Void Contracts or Contract Provisions

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signature-962355__340-300x225Contracts Under New Jersey Business Law

Under New Jersey business law, when two or more parties enter into a contract they are essentially writing their own law which will govern their relationship.  A valid contract – one where each of the parties exchange value (“consideration”) and agree to the terms which will govern their relationship or transaction – will be enforced by courts.  If there is a dispute, a court will make a decision which can be fully enforced.

The Covenant of Good Faith and Fair Dealing

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business-1753098__340-300x213New Jersey’s Conscientious Employee Protection Act (“CEPA”) employees from being fired for objecting to or refusing to participate in conduct which the employee reasonably believes to be illegal or against public policy.  If the employee is wrongfully retaliated against, CEPA provides a remedy through litigation.   Also known as the “whistleblower law,” CEPA is one of the most strongest employee protection laws in the country.  However, since it was enacted in only 1986, courts continue to disagree as to the exact scope and extend of the law.

In the recent case of Trzaska v. L’Oreal USA, Inc., the employee, Steven Trzaska claimed that he was fired in retaliation for his refusal to take actions which he believed violated the Rules of Professional Conduct (“RPC”).  RPCs set forth the rules for ethical conduct which although must follow, and, in fact, an attorney may lose his license to practice law if certain rules are not followed.  In the Trzaska case, L’Oreal had issued a quota or mandate for Mr. Trzaska to prepare a certain number of patent applications.  Mr. Trzaska advised that he would not file any patent application unless he had a good faith believe that the product was patentable.  Mr. Trzaska was fired thereafter and he filed a lawsuit in the District Court.

The United States District Court for the District of New Jersey then dismissed Mr. Trzaska’s case in the early stages requiring that the RPCs did not meet CEPA’s requirements that the employee object to or refuse to participate in illegal conduct.  CEPA’s language

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group-418449__340-300x300Our labor and employment attorneys represent employers and employees in cases of wrongful termination and discrimination.  This is an area of New Jersey employment law which generates considerable litigation.  New Jersey’s Supreme Court recently issued an important opinion on when an employee may be terminated because her disability impairs her ability to perform the essential functions of her job.

Maryanne Grande had been a registered nurse for thirty years, and employed by St. Claire’s Health System for ten years, from 2000 through 2010.  St. Claire’s job description for a registered nurse included lifting fifty pounds from waist to chest “frequently” as an “essential” job function.  Grande suffered a series of injuries at work beginning in 2007.  Her final injury was suffered while she was preventing an overweight patient from falling.  Her doctor cleared her to resume full-duty work.  However, St. Claire’s ordered her to undergo a physical with its own doctor, who said she could perform lifting only “occasionally,” which it defined as “1-33% of the time.”  However, the report also concluded that it was “improbable that this will significantly affect job performance ability.”  The report also concluded that Grande could return to work with “altered duties.”

Her own doctor again examined her and provided her with a form which said she could return to work with only certain limitations on lifting.  The next day Grande was fired.  She returned to her doctor, who cleared her to return to full-time duty with no restrictions.  However the termination was not rescinded.

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dc-court-appeals-district-columbia-building-abraham-lincoln-statue-74985350One of the most vexing problems facing employees suing their employers for harassment is what legal standard the acts must meet in order to prove harassment.  In the case of Castleberry v. STI Group, the United States Court of Appeals for the Third Circuit held that harassment need only be severe or pervasive, giving a significant victory to employees.

In that case, Atron Castleberry and John Brown were African-American men.  They obtained jobs through a staffing agency, STI Group, which employed and placed them with Chesapeake Energy Corporation, an oil and gas company.  Shortly after they were hired, the only other African-American on their crew was fired.  They alleged that on several occasions someone wrote “don’t be black on the right of way” on their timesheets.  They also alleged that they were only allowed to clean around pipelines despite their experience, when other employees faced no such restrictions, including white employees with less experience.  They also claimed that while they were working on a fence-removal project their supervisor told them that they would be fired if they “n…..r-rigged” the fence.  After the last incident, which seven co-workers confirmed, they reported the incident.  Two weeks later they were fired.

They filed suit in the United States District Court under federal employment law.  The district judge dismissed their case before any evidence was exchanged in discovery because he believed that the employees had not alleged harassment which created a hostile work environment which was both “severe” and “pervasive.”  The employees appealed to the United States of America for the Third Circuit, which hears appeals of New Jersey Federal cases.  The Third Circuit reversed.

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megaphone-1480342__340-300x200The New Jersey Civil Rights Act, the state counterpart to the federal law known as “Section 1983,” is a powerful tool for government employees to protect themselves when their public employers violate their civil rights

After the Civil War, Congress passed a law known as “Section 1983.”  Section 1983 was part of the Ku Klux Klan Act, also known as the Civil Rights Act of 1871.  The Act was passed at the urging of President Ulysses S. Grant as part of a series of measures during Reconstruction to protect the rights (and safety) of freed slaves in the South, who were facing increased violence and intimidation from the Klan and others.  Indeed, much of this was orchestrated with local government.  Section 1983 therefore made it illegal for someone to act “under color of law or authority” to deprive another person of their rights under the United States Constitution or federal law.  Essentially, it gave people a remedy for violation of their rights.  It allowed for civil suits, injunctions, punitive damages and the recovery of attorneys fees as well.  Over the years, Section 1983 has come to protect the rights of public employees from the denial of rights by local government employers.

However, New Jersey had no counterpart for a remedy for people deprived of their rights under the New Jersey Constitution or New Jersey law, which was not protected under Section 1983.  To resolve this gap, in 2004, New Jersey enacted the New Jersey Civil Rights Act to provide a remedy for violations of a person’s civil rights protected by New Jersey laws or the New Jersey Constitution.  Like its federal counterpart Section 1983, the New Jersey Civil Rights Act protects public employees from deprivation of their civil rights by their local employers.  As currently interpreted by the courts, the New Jersey Civil Rights Act allows for suits only against local governments such as towns, cities, boards of education, counties and local government authorities (such as housing authorities, parking authorities, etc.).

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handshake-2056023__340-300x200As a general rule, oral contacts in New Jersey are enforceable – not that they are recommended; indeed.  Our attorneys, we always recommend that contracts be in writing because they are easier to prove and leave less room for misunderstandings.  However, if you can prove the terms of an oral contract New Jersey courts will generally enforce it.

A big exception applies to this, however, in the Statute of Frauds.  Under the New Jersey Statute of Frauds, courts will refuse to enforce certain oral contracts even if you can prove them.  This law is based on the premise that oral contracts are inherently less reliable, and writings in certain situations are necessary to prevent perjury or unfounded claims.  The Statute of Frauds has its roots in the old Statute for the Prevention of Frauds and Perjuries which was adopted by the English Parliament in 1677, and was thus the law in England’s American Colonies when they became independent.  The main elements of the Statute of Frauds are found in one section of New Jersey Statutes, but other elements are spread in different sections of Chapter 25 of Title 2A of New Jersey Statutes.

The main types of contracts which the Statute of Frauds requires to be in writing are:

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wheelchair-1595794__340-300x200Under New Jersey’s Civil Service System, hiring and advancement are required to be based on merit.  In a civil service jurisdiction, taking the civil service test is just the first step in the process of obtaining a position as a New Jersey law enforcement officer or firefighter.  After this there will be a background investigation, interview, and physical and psychological examinations.  Under New Jersey civil service regulations a candidate may be rejected if she “Is physically or psychologically unfit to perform effectively the duties of the title.”  (An exception applies when the “an injury incurred in the armed forces… unless the Commissioner [of Civil Service] considers the condition incapacitating.”)

Many times, and for a variety of reasons, perfectly fit candidates fail the psychological examination, which is usually conducted by a mental health professional selected by the agency to which the candidate is applying.  However, the regulations and New Jersey’s Civil Service Act (Title 11A of New Jersey Statutes) provides for an appeal to the New Jersey Civil Service Commission.

To remove an applicant, the department or agency (known as the “appointing authority” or “employer” in the regulations) must request that the Commission remove an otherwise eligible applicant’s name from an eligible list because of her alleged psychological unfitness which purportedly renders her unable to effectively performing the duties of the title.   The request must include “a copy of the certification and a report and recommendation supporting the removal request, prepared and signed by a physician, psychologist or psychiatrist who is licensed in New Jersey or qualified and employed by the appointing authority in the Clinical Psychologist title series.”  It must include “a finding that the eligible is not qualified due to medical or psychological reasons for the title.”  Finally, it must include “All medical, psychiatric, and psychological examinations performed at the appointing authority’s request shall be at the appointing authority’s expense.” The request may be denied for failure to provide the required documentary support.

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signature-962364__340-300x225Representing parties negotiating contracts and litigating over breach of contracts are some of our attorneys’ main practice areas.  New Jersey contract law recognizes both contracts and “quasi-contracts.”  This post examines what these are and the differences between them.

Contracts

New Jersey contract law defines a contract as a voluntary agreement for mutual obligations based on a common understanding resulting from “offer and acceptance.”   New Jersey’s Model Civil Jury Charges have laid out the required elements to create a binding contract: (1) a meeting of the minds between the parties to the contract, (2) offer and acceptance, (3) valid consideration, ie., mutuality of obligations,  and (4) certainty — clear and definite terms.

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worried-30148__340-217x300In the case of In re Linear Electric Company, Inc., the Third Circuit was presented with whether construction liens filed by a supplier under New Jersey law were valid and enforceable against a contractor who filed a petition for Chapter 11 bankruptcy protection prior to when the construction liens were filed.

New Jersey’s Construction Lien Law, N.J.S.A. §2A:44A, et seq., provides contractors, subcontractors, and suppliers with the right of filing a lien for work, services, or materials provided pursuant to a written contract.   These protections are limited based on several factors including but not limited to whether the person or entity filing the construction lien is defined as a “claimant” under New Jersey’s Construction Lien law, what the unpaid portions of the contract price is, and compliance with strict time restrictions for filing the lien itself and a subsequent lawsuit based on the lien.

Under the Federal Bankruptcy Code, a debtor who files for bankruptcy is afforded the relief of an automatic stay that prevents most collection actions from continuing including acts to create, perfect, or enforce liens against property.  The protections of an automatic stay are broad and expansive but do include several expectations and limitations for certain debts.

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