NJ Appellate Division: Charitable Immunity Unavailable When a Plaintiff is on Premises as an Employee of a Third Party

The New Jersey Appellate Division affirmed a trial court’s ruling that a community college employee who was injured in a slip-and-fall at a nonprofit rehabilitation facility where she taught classes to nurses was not a beneficiary of the clinic’s charity and could not rely on the Charitable Immunity Act for a defense.   In Kostera v. Bacharach Institute for Rehabilitation, Dkt. No. A-1991-13T4 (N.J. App. Div. Aug 6, 2015), the Appellate Division also affirmed the $4 million jury award.

Bacharach Institute for Rehabilitation (“BIR”) was a nonprofit organization organized solely for hospital purposes and provided a training facility for prospective nurses, including students from Atlantic Cape Community College (the “College”), and provided facilities for classes to be taught.  The Plaintiff, Carolyn Kostera, was a part-time professor at the College, and she was assigned to teach classes at BIR’s facilities.   In February 2010, Kostera slipped and fell on ice that had accumulated on the sidewalk in front of BIR’s facility and suffered a fractured ankle and torn tendons, requiring multiple surgeries.

She sued BIR and alleged that the facility was negligent in maintaining the premises, and BIR filed a motion to limit any damage to $250,000 under New Jersey’s Charitable Immunity Act.  The Act’s purpose is to protect nonprofit organizations from awards of damages to any person who is a beneficiary of the organization.   The trial court rejected this claim.

The test for determining whether the Charitable Immunity Act is applicable has two prongs.  Ryan v. Holy Trinity Evangelical Lutheran Church, 175 N.J. 333, 350 (2003).  First, the defendant must be engaged in the performance of “the charitable objectives it was organized to advance” at the time of the accident.  Ibid.  Second, the injured person must have been a “direct recipient of those good works.”  Ibid.  Synthesizing the case law, the Appellate Division explained that a plaintiff will be considered a beneficiary of a nonprofit or charitable organization if, on the day in question, she was a “direct recipient,” to whatever degree, of the good works that the organization was advancing at the time.  However, if the plaintiff was “unconcerned in and unrelated” to those good works, then she will not be considered a beneficiary for purposes of the Act.  Ibid.; see also N.J.S.A. 2A:53-7(b).

The Appellate Division noted that a plaintiff may be considered a beneficiary of an entity’s good works even when a person’s presence on the facility’s property was caused by a relationship with another person or entity.  The Court provided various examples of situations where the Charitable Immunity Act could be invoked (a son who was injured when he accompanied his father to a basketball game at a nonprofit’s organization was a beneficiary, a father who was chaperoning his sons’ Boy Scout troop during a sailing lesson aboard a boat operated by a charitable nonprofit entity was a beneficiary, a mother who was on the premises to pick up her son after class was a beneficiary of a parochial school).

In this case, however, Plaintiff was at BIR’s facility because of her employment with the College.  “[H]er status as an employee of ACCC differentiates her from those plaintiffs in the numerous cases cited above where immunity applied.”  The Court cited the case Mayer v. Fairlawn Jewish Center, 71 N.J. Super. 313 (App. Div. 1961), aff’d in part, rev’d in part on other grounds, 38 N.J. 549 (1962), which held that a plaintiff will not be a beneficiary under the Act when “[he] was present on the premises . . . at the direction of his employer and in fulfillment of his function as an employee, not for the purposes of receiving personally the philanthropy of the [nonprofit organization].”  Id. at 354.

With this background, the Appellate Division concluded that BIR was engaged in the performance of charitable objectives (educating medical professionals) at the time Plaintiff suffered her injury.  As for the second prong, the Appellate Division admitted that this “test is more difficult to apply under the facts of the case.”  The Appellate Division noted that, unlike the Mayer case, Kostera was not a stranger to BIR, as she was an adjunct professor who repeatedly went to BIR to “teach and supervise” the College’s nursing students.  Further, Plaintiff’s presence at BIR was “integral to the benefactions BIR bestowed, i.e., the education of student nurses.”

Despite noting the differences between the facts at hand and the prior precedent, the Appellate Division held that it was an intermediate court, bound to follow and enforce the decisions of the Supreme Court.  Given the existing precedent (Mayer), “plaintiff’s status of an employee of ACCC placed her outside BIR’s charitable endeavors.”

Clearly, the Appellate Division expressed serious reservations about declining to apply the Charitable Immunity Act under the facts at hand, but ultimately determined that the existing New Jersey Supreme Court precedent created a bright-line rule:  if a plaintiff is on the premises of a nonprofit organization at the direction of his employer, he will not be considered a beneficiary under the Charitable Immunity Act.

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Written by Danny C. Lallis

Danny is a Partner with Pisciotti Malsch, and his practice includes appeals, product liability, and commercial litigation.