NWCDN Members regularly post articles and summary judgements in workers’ compensations law in your state.
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Samuel Roman formed Treeminator Tree Services, Inc. in 2007. By 2012 he and his girlfriend, Sandra Flores, were both employees along with two others. In 2009 Roman sought workers’ compensation coverage with NJM for Treeminator Tree Service, LLC, a company with no employees and a minimum premium. He obtained the same type of policy in later years with Technology Insurance Company, part of the Amtrust Group.
On May 4, 2012, Roman was cutting down a tree when he fell and suffered very serious injuries. He filed a workers’ compensation claim against Technology Insurance Company, which denied the claim on the ground that the policy indicated that Treeminator was an LLC with no employees. Petitioner then filed a Motion for Medical and Temporary Disability Benefits, and a full trial ensued with testimony from petitioner, his girlfriend, and three witnesses associated with the insurance broker.
The Judge of Compensation, the late Honorable Virginia Dietrich, ruled that petitioner made material misrepresentations in procuring his insurance application and was not entitled to coverage. She found that Mr. Roman provided false information in obtaining his policy in that all of his workers’ compensation policies indicated that he had no employees. The application for the Technology policy described the business as a “one man operation – no employees.”
Further, the Judge of Compensation noted that Roman also misrepresented the nature of the business as one involving landscaping instead of the high risk work of tree removal and tree trimming. She concluded that Roman did not intend to cover himself when he procured his workers’ compensation policy.
Roman appealed and contended that his broker erred in not procuring for him a policy listing his company as a corporation. He argued that he himself should not suffer due to his broker’s error. The Appellate Court noted that the Judge of Compensation rejected this argument because it was clear from the evidence at trial that Roman was trying to pay the absolute lowest amount possible for coverage as a Limited Liability Corporation (LLC) with no employees. The Court said, “When apprised of the increased costs of insuring a company with employees, Roman chose to ‘take coverage as cheaply as he could find it. He wanted to pay the least and hoped for the best.’”
The Appellate Court agreed with the Judge of Compensation that there was sufficient credible evidence in the record to support the finding that petitioner made a material misstatement of fact underN.J.S.A. 34:15-57.4, thereby warranting dismissal. This matter was handled successfully by Nick Dibble, Esq. of Capehart Scatchard with assistance on the brief from the undersigned. It can be found at Roman v. Treeminator Tree Service, A-0094-14T2 (App. Div. December 2, 2015).
John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at email@example.com.