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F.K. v. Integrity House Inc. Superior Court Of New Jersey Appellate Division July 8, 2019
(Approved For Publication)
Submitted by New Jersey Personal Injury Lawyer, Jeffrey Hark.
Plaintiff F.K. appeals the trial court’s order granting summary judgment to Integrity House and dismissing his complaint with prejudice. The trial court determined the defendant was entitled to immunity from plaintiff’s negligence claim. On appeal, plaintiff argues the amount of private contributions which was about 1.26% of annual revenue, was insignificant to entitle defendant to charitable annuity. Integrity House’s stated purpose was to keep former drug addicts drug free. On November 3, 2015, plaintiff slipped and fell on defendant’s property due to a wet condition on the interior staircase. Before the close of discovery, Integrity House moved for summary judgment on the ground of charitable immunity. Defendant also submitted its 2015 tax return which reported $20,094,046 in total revenue. Out of all that money only $157,310 was from fundraising and $296,409 was from other contributions. On May 12, 2017, an order and written opinion deny the motion for summary judgment, after hearing oral argument. After the discovery window closed defendant re-filed their motion for summary judgment, adding certifications stating that all of the $252,000 in gross receipts raised from fundraising for the 2015 tax year were used for charitable purposes. Plaintiff submitted a report from a forensic accounting expert analyzing the 2015 tax return. The expert could not determine whether the $252,000 was from the government or private source. The expert states, “Integrity House has failed to provide an analysis of the source of its funds for the year in which the November 3, 2015 accident took place. Based on the information provided by Integrity House, there is absolutely no documentation which would facilitate a determination of the funding sources.”
The trial court ended up granting summary judgment on October 27, 2017.
Plaintiff appealed, and the appellate court vacated the dismissal order and remanded it for further processing because the trial court did not issue an oral or written reason for why Integrity House was entitled to charitable immunity. On remand, the trial court issued a written opinion granting summary judgment on December 11, 2018. The trial court determined Integrity House established the three elements necessary for charitable immunity: “”(1) was formed for nonprofit purposes; (2) is organized exclusively for religious, charitable or educational purposes; and (3) was promoting such objectives and purposes at the time of the injury to plaintiff who was then a beneficiary of the charitable works.” Tonelli v. Bd. of Educ. of Wyckoff, 185 N.J. 438, 444-45 (2005) (quoting Hamel v. State, 321 N.J. Super. 67, 72 (App. Div. 1999)).
The plaintiff appeals based on the second prong of the charitable immunity analysis. Plaintiff argues the $252,855 in private contributions, is only a mere 1.26% of Integrity House’s total revenue in the 2015 fiscal year. This small percentage is too insignificant to establish the defendant as an exception in the charitable immunity category. The appellate court states, “an organization claiming immunity under the Act must demonstrate some level of support from charitable donations and/or trust funds as it is those sources of income the Act seeks to protect.” Bieker v. Cmty. House of Moorestown, 169 N.J. 167, 178 (2001) (emphasis added); see also Morales, 302 N.J. Super. at 56 (noting that the defendant “receive[d] a substantial amount of charitable contributions, which is one of the essential characteristics of a non-profit corporation entitled to charitable immunity.” The appellate court found that based on the unrebutted forensic accounting expert, they were unable to conclusively determine which figures should be used for the charitable immunity analysis. Integrity House did not provide sufficient enough evidence to prove the source and use of its funding. The appellate court found the trial court erred in determining that Integrity House was entitled to charitable immunity. The court reversed and remanded the case for further proceedings.