July, 2017


I. EMPLOYMENT LAW

Employer Cannot Unilaterally Decide Whether an Employee Can Perform a Job Notwithstanding a Disability

In Grande v. Saint Clare’s Health System, ___ A.3d ___, 2017 WL 2963024, (N.J. July 12, 2017), Grande, a registered nurse (R.N.), was employed by Saint Clare’s from approximately 2000 through July 2010. For most of her tenure, she was assigned to care for patients who were recovering from strokes. The job often required her to lift patients or prevent them from falling.

Beginning in 2007, Grande had several work-related injuries that affected both shoulders and required her to take time off in order to recuperate. In early July 2010, Grande’s physician, Dr. Spielman, cleared her to resume full duty work. The hospital informed Grande that, before returning to full duty, she would have to undergo a functional capacity evaluation. The specialists retained by the hospital said Grande could return to work but could only perform limited tasks, and added that she should not lift more than sixteen pounds. On July 21, 2010, following the functional capacity evaluation, Dr. Spielman re-examined Grande. He provided her with a form that indicated she could return to work the next day with restrictions, “per [the] FCE.” The hospital specialist, in turn, advised the hospital that Dr. Spielman “agreed with the FCE report and advised that [Grande] should have permanent restrictions of lifting up to 50 lbs occasionally and that she should transfer patient with assistance only.”

The following day, Grande was summoned to a meeting with her supervisors, at which she was fired. Grande testified in her deposition that she was told she had limitations that would prevent her from doing her job.

Nearly a year after her discharge, Grande filed a two-count complaint against Saint Clare’s, alleging violations of N.J.S.A. 10:5-4.1, a subsection of the LAD. The first count alleged that Saint Clare’s unlawfully discriminated against Grande based on her disability, and the second count alleged unlawful discrimination based on a perceived disability. The trial court granted summary judgment in favor of Saint Clare’s, finding that Grande did not establish a prima facie case of discriminatory discharge because she “failed to articulate whether she was performing (or was able to perform) her job at a level that met the employer’s legitimate expectations.”

A divided Appellate Division panel reversed, vacating summary judgment and remanding because the record contained several material facts in dispute that could only be resolved by a jury. According to the majority, “the motion court incorrectly resolved these materially disputed facts in favor of [Saint Clare's] and rejected or minimized the importance of evidence a rational jury could find to support [Grande's] case of unlawful discrimination due to her perceived physical disability.”

Saint Clare's filed an appeal limited to whether summary judgment was appropriately awarded to the hospital by the trial court.

In a unanimous decision, the court affirmed the majority ruling of the Appellate Division panel that said existing issues of material fact should allow plaintiff Maryanne Grande a chance to show that she was fired from Saint Clare's Health System even though she was physically able to perform her job. The Court provided that “disputes over what is an essential function of the job and whether an employee can perform the job notwithstanding a disability, or perceived disability, are for a jury to decide. They are not issues for the employer to decide unilaterally.”



II. INSURANCE LAW

Pennsylvania Supreme Court Rules that Insurance Salesman had No Fiduciary Duty to Policyholders

In Yenchi v. Ameriprise Financial, Inc., — A.3d —, 2017 WL 2644473 (Pa. June 20, 2017), plaintiffs, Eugene and Ruth Yenchi, sued their financial advisor, Bryan Holland, over an underfunded life insurance policy he sold them in 1996. In 1995, the defendant financial advisor contacted the Yenchis and presented himself as a financial advisor with Ameriprise Financial Inc. They met in his office, and the Yenchis agreed to buy a financial analysis. The parties then discussed their financial status. Holland presented the Yenchis with detailed financial management proposals to help better prepare for their retirement, including a recommendation to consolidate their life insurance policies into a single policy. The advisor said the premiums would never increase and would end after eleven years. He also advised that they purchase a deferred variable annuity, which he said would mature when Ruth Yenchi turned 65.

Several years later, plaintiffs had the life insurance policy and annuity independently reviewed and learned that the insurance policy was underfunded and that they would have to pay additional premiums, with increasing rates, beyond the premiums that Holland allegedly represented to them. In addition, plaintiffs discovered that the variable annuity would not mature until they turned 84, rather than 65, as they claimed Holland represented to them. Plaintiffs filed suit, asserting various claims against the advisor, including a claim for breach of fiduciary duty.

The Yenchis claimed that Holland had breached a fiduciary duty when he recommended that they purchase the insurance policy and the annuity. They argued that they had put their trust in Holland, who held himself out as an expert in financial and retirement planning matters, and that they only had high school educations and no experience working with a financial advisor.

The Court rejected plaintiffs’ assertion that a fiduciary relationship existed with Holland because he held a superior position with respect to his knowledge of insurance products and financial services. In so doing, the Court concluded that fiduciary duties do not arise merely because one party relies on and pays for the specialized skill of the other party. Rather, the Court held that the critical question in determining if a fiduciary relationship exists is whether the consumer ceded control over the decision to purchase, either explicitly or implicitly, because of “overmastering influence” on one side or “weakness, dependence, or trust justifiably reposed” on the other.




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