Court Allows Claimant to Reopen Previously Dismissed Claim Based on Dishonesty of Claimant’s Attorney

Cases dismissed under N.J.S.A. 34:15-54 for lack of prosecution are permanently closed if not reinstated within one year.  The matter of Kost v. GPU Energy, A-0858-13T3 (App. Div. 2015) offers one exception to the rule.

Richard Kost filed seven claims against GPU Energy/JCP&L in 2003.  He also filed a parallel civil action which was pending from 2003 to 2008.  Claimant’s attorney, Eric Lentz, left his law firm, Garces and Grabler, in March 2005.  Lentz kept the case and from time to time met with Mr. Kost.

Problems began between the years 2005 and 2008.  Lentz failed to comply with several requests made by the Judge of Compensation, leading GPU to file a motion to dismiss for lack of prosecution.  That motion was granted in December 2008.  The rule provides that the claimant has one year to reopen the matter or the dismissal becomes final.

On December 8, 2008, GPU’s attorney sent the order of dismissal to Lentz, who had not appeared at the hearing when the case was dismissed.  Mr. Kost said he was never made aware of the dismissal.  He said he called his lawyer on numerous occasions but could not reach him.  Finally in January 2010, he reached his lawyer, who misled him into believing that the workers’ compensation cases were still active.  Lentz told Kost that the cases were progressing, and from time to time he asked Kost to sign medical authorization forms. The Appellate Division noted, “However, it is clear that Lentz hid from petitioner the true status of his cases.”

In January 2010, Lentz scheduled an appointment for Kost to attend a permanency exam.  When petitioner got to the doctor’s office, there was no record of any appointment, nor any paperwork from Lentz.  Kost confronted Lentz, who assured him that the cases were progressing.  He never told Kost that his cases had been dismissed in December 2008.

Kost retained new counsel, who figured out that the cases had been dismissed and attempted to restore the cases to the active list.  GPU argued that the one-year time period for reinstatement had passed.  The Judge of Compensation on September 16, 2013, refused to reinstate the case, and Kost appealed.  The Appellate Division was faced with the fact that N.J.S.A. does not provide for any exceptions:

Although N.J.S.A. 34:15-54 does not expressly create an exception to the one-year requirement for filing a motion for reinstatement, our courts have recognized that compensation judges possess the inherent power to excuse the one-year time bar upon the grounds set forth in Rule 4:50-1.

The Court found that this was an exceptional circumstance.  “Petitioner’s dilemma was not caused by his own dereliction or ambivalence. Instead, fault for the dismissal rests squarely on his prior attorney.  Here, petitioner made significant effort to keep in contact with Lentz.  He was affirmatively mislead, and assured his cases were still active.  It was not until new counsel took over in 2010 that petitioner was informed his cases were dismissed.”

The Court also noted that GPU was not really prejudiced in this case because the company had obtained substantial discovery during the five-year period of the civil litigation.