Thomas Paschos and Assoc
October, 2007

EMPLOYMENT LAW ISSUES

In Order to State a Claim for Failure to Accommodate Under the New Jersey Law Against Discrimination, Plaintiff Must Show that he is “Otherwise Qualified to Perform the Essential Functions of the Job, With or Without the Accommodation by the Employer.”

In an unpublished opinion, Curcio v. University of Medicine and Dentistry of New Jersey, Superior Court of New Jersey, Appellate Div., Docket # A-2309-06T3 (October 17, 2007), F. Blaise Curcio appealed from a summary judgment order dismissing his complaint against University of Medicine and Dentistry of New Jersey.

Mr. Curcio was fired by UMDNJ in 1989 as a Clinical Professor of Dentistry. He eventually became a Director and Vice Chair for the Dept. of General Dentistry. In March 2002, Mr. Curcio began a leave of absence due to a diagnosis of malignant hypertension. As a result of his condition, Mr. Curcio suffered headaches and dizziness, and on at least one occasion experienced unconsciousness. Mr. Curcio remained out on leave for fifteen months, even though the faculty handbook for UMDNJ allowed for only a twelve-month period. Mr. Curcio admits that while on leave, he continued to experience poor balance, unsteady gait, fatigue, and depression. Throughout this time, Mr. Curcio’s doctor stated that he was unable to work.

On May 16, 2003, UMDNJ contacted Mr. Curcio to determine when he would return to his faculty position. They further advised, at that time, that he could ask for a reasonable accommodation for his disability. UMDNJ further advised Mr. Curcio that his medical leave could not be extended further, and that he would be terminated if he was not able to return to work. Thereafter, Mr. Curcio met with the Department Chair at UMDNJ, at which time he indicated he would like to return to work, and requested a reasonable accommodation, although he did not specify what accommodation was required. Testimony indicated that Mr. Curcio might have requested an administrative position at that time; however, none was available. Rather, Mr. Curcio was needed to work in his former position as a Clinical Professor, which included working with students and live patients. On June 17, 2003, after having heard nothing further from Mr. Curcio, UMDNJ wrote to Mr. Curcio, advising that his position had been terminated. At that time, UMDNJ had still received no documentation from any of Mr. Curcio’s physicians clearing him for return to work.

In or about March 2005, Mr. Curcio filed suit, alleging that UMDNJ failed to provide him with a reasonable accommodation for his disabilities, in violation of the New Jersey Law Against Discrimination (LAD). Following discovery, UMDNJ filed a motion for summary judgment, which was granted by the trial court in November 2006. Mr. Curcio then appealed.

The Appellate Court noted that in order to establish a claim under the LAD, Mr. Curcio would have to show that he “(1) had a disability, (2) was “otherwise qualified to perform the essential functions of a job, with or without the accommodation by the employer,” (3) that he “suffered an adverse employment action because of the disability.” Further, once it is shown that he sought a reasonable accommodation, the employer must show, in order to counter this, that they began an informal process with the employer to identify a reasonable accommodation.

Mr. Curcio alleges that UMDNJ violated the New Jersey LAD by failing to engage in the interactive process

.

The Court found that the analysis need not reach that step, because Mr. Curcio was unable to show that he could have performed his job with some reasonable accommodation. However, at the time that Mr. Curcio sought a reasonable accommodation, he had not been cleared to return to work by any of his physicians. Further evidence that he could not have performed the job, even with a reasonable accommodation, is the fact that shortly after termination, Mr. Curcio applied for long-term disability, which he did receive. Finally, the court noted that even when Mr. Curcio did return to work in another position, he did not hold or apply for any job that involved teaching or performing dental work on live patients.

In affirming the trial court’s granting of summary judgment, the Appellate Court stated, “The LAD is not violated where an employee is terminated because the employee is unable to perform the job due to a handicap even with accommodation.” Accordingly, because Mr. Curcio could not have performed his job, even with a reasonable accommodation, summary judgment was warranted.


CORPORATE LAW ISSUES

Pennsylvania Superior Court Sets Forth Factors in Favor of Piercing the Corporate Veil.

In Fletcher-Harlee Corp. v. Szymanski --- A2d ---, 2007 WL 2984153 (Pa. Super, October 15, 2007), Fletcher-Harlee Corp. appealed from a judgment entered in favor of David Szymanski.

Fletcher-Harlee, a general contractor overseeing construction of an elementary school, subcontracted concrete work for the project to Delmarva Concrete, Inc. (“Delmarva”). Mr. Szymanski was the sole shareholder, director, and officer of Delmarva, as well as several other corporations. When a dispute arose, Fletcher-Harlee sought the intervention of the American Arbitration Association. Delmarva chose not to participate in or defend itself at arbitration, and Fletcher-Harlee was awarded $313,179.52 plus fees. This award was converted into a judgment against Delmarva. Shortly thereafter, Delmarva ceased operations, and eventually filed for bankruptcy. Szymanski, however, continued in the concrete business, performing work through another corporation of which he was the sole shareholder, director and officer.

In April 2004, Fletcher-Harlee brought suit against Szymanski, as well as several other parties who were later dismissed. As a part of that suit, Fletcher-Harlee sought to pierce the corporate veil at Delmarva, in order to hold Szymanski liable for the judgment against Delmarva.

At trial on the matter, evidence was presented that Delmarva and several other corporate entities for which Szymanski was the sole shareholder, director and officer all occupied the same office space. Additionally, several of those entities, including Delmarva, used a common computer, and shared a single employee. There was also evidence that monies from Delmarva and several of the other entities may have been commingled, and monies from Delmarva may have been commingled with Mr. Szymanski’s personal funds, and that business and personal records may have been stored together.

Following trial, the trial court found in favor of Szymanski, refusing to disregard the corporate status of Delmarva or pierce the corporate veil. On appeal, the Court noted the numerous factors to be considered in determining whether the corporate veil should be pierced. These factors include undercapitalization, failure to adhere to corporate formalities, substantial intermingling of corporate and personal affairs, use of the corporation to perpetuate a fraud, the existence of officers and directors other than the dominant shareholder, and finally, whether the dominant shareholder has use of the assets of the corporation as his or her own.

Using this analysis, on appeal, the Pennsylvania Superior Court found in favor of Appellant, Fletcher-Harlee. Specifically, the Superior Court found (1) Delmarva was clearly undercapitalized, as it was forced to cease business, and subsequently to file for bankruptcy, following the arbitration in this matter; (2) the entities failed to adhere to corporate formalities, specifically with regard to recordkeeping; (3) corporate and personal funds and records had been commingled; (4) there were no other officers or directors; and (5) Szymanski, the sole shareholder, had used the corporation as his own. Therefore, even though no fraud had been found, the Pennsylvania Superior Court found that the trial court had erred in denying Fletcher-Harlee a judgment notwithstanding the verdict. The matter was vacated and remanded for entry of judgment in favor of Fletcher-Harlee.


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