New Jersey Supreme Court Expands Usage of Discovery Rule
Though the decision has received a great deal of attention because of the controversy, as played out in the separate opinions of Chief Justice Rabner and Associate Justices Rivera-Soto and Hoens, over whether the temporary appointment to the New Jersey Supreme Court of Judge Stern of the Appellate Division is constitutional, the recently decided case of Henry v. New Jersey Department of Human Services, is of special interest to employers, as it appears to expand the circumstances under which a plaintiff can invoke the equitable device known as the “discovery rule” to toll the 2-year statute of limitations applicable to claims under the Law Against Discrimination (LAD). In Henry, the Court, by a vote of 5-1 with one abstention, affirmed the Appellate Division’s holding dismissing plaintiff’s retaliation claim but reversed the Appellate Division’s dismissal of plaintiff’s discrimination claim. The Court remanded the discrimination claim for the trial court to conduct a hearing to ascertain whether plaintiff could not have reasonably discovered she had claim within 2 years of the accrual of her cause of action.
Plaintiff, Lula Henry, an African-American, holding a Master of Science Degree in Nursing, secured a full-time entry-level nursing position at the Trenton State Psychiatric Hospital (the Hospital) in April 2004. Upon accepting the position, she developed a concern that the Hospital was engaging in discriminatory hiring practices, as the only other two women who possessed a Master’s Degree, both of whom were Caucasian, were employed in more advanced positions. A member of the Hospital’s human resources department angrily advised plaintiff, however, that employees were only eligible for advancement after successfully completing one full-year of employment. During the Summer of 2004, plaintiff made a written request seeking that she be reclassified based upon her qualifications and sent a copy of her letter to a State Assemblyman. Afterwards, a human resources manager nastily told her that she had stood a chance of being reclassified “until he received a letter from some bureaucrat downtown.” In response to this conversation, plaintiff resigned and later secured employment elsewhere.
In the Spring of 2006, plaintiff received information from a union representative that confirmed many of the suspicions she had when she was hired. Specifically, plaintiff learned that a Nigerian nurse had contested the placement of a less qualified Caucasian nurse and also learned that a Caucasian nurse with credentials less extensive than her own was hired into a non-entry level position.
Plaintiff filed a complaint against the Hospital on July 24, 2007, claiming it had unlawfully discriminated against her in its hiring practices and had retaliated against her when she complained. The trial court granted the Hospital’s’ motion for summary judgment on both of these claims. The Appellate Division affirmed.
Supreme Court’s Decision
The Court began its analysis by discussing the history of the discovery rule. First employed in the medical malpractice context, the discovery rule has been extended to a variety of claims, including those brought under the LAD. The Court explained that the discovery rule triggers the tolling of the applicable statute of limitations when it is determined that a reasonable person employing ordinary diligence would be unaware that they have a valid cause of action against another party.
As to plaintiff’s retaliation claim, the Court sought guidance from its recent decision in, Roa v. Roa, holding that the continuing violation theory does not permit the aggregation of discrete discriminatory acts for the purpose of reviving untimely filed claims. See generally 200 N.J. 555 (2010). Here, the Court found that plaintiff clearly knew or should have known that she was the subject of retaliation within the 2-year limitations period, since while still employed she was in essence told that she would have been reclassified had she not complained. Thus, the Court affirmed the dismissal of the retaliation claim.
The Court, however, considered the analysis of plaintiff’s discrimination claim to be more complex. Though the Court recognized that plaintiff did have an initial concern of discrimination upon acceptance of the entry-level position with the Hospital, the Court found most significant the fact that a member of the human resources department at the Hospital had given her nondiscriminatory reasons for not advancing her. Her reliance on these statements, in the eyes of the Court, may have rendered Plaintiff “unaware” for purposes of the discovery rule that she had a cause of action until she learned, more than 2 years later, that similar discriminatory practices had occurred at the Hospital. Thus the Court reversed the dismissal of plaintiff’s discrimination claim and remanded the case to the trial court in order to conduct a hearing at which plaintiff “is entitled to assert that she had no “reasonable suspicion” of racial discrimination, even by the exercise of reasonable diligence, until 2006 . . . .”
The Court’s decision appears to have expanded the basis upon which the discovery rule may be invoked to toll the statute of limitations. The facts reveal that plaintiff clearly was at least minimally “aware” of the presence of discriminatory treatment. Although the Court did not directly hold that the employer was stopped from asserting the statute of limitations, it appears to have incorporated equitable tolling principles into the discovery rule by holding that plaintiff’s reliance on her employer’s explanation may have rendered her “unaware” of her claim. We will keep an eye on further developments in the case.