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Montells v. Haynes

Decided: July 27, 1993.


On certification to the Superior Court, Appellate Division, whose opinion is reported at 258 N.J. Super. 563 (1992).

For affirmance in part; for reversal in part; for remandment -- Chief Justice Wilentz and Justices Clifford, Handler, Pollock, O'Hern, Garibaldi and Stein. Opposed -- None. The opinion of the Court was delivered by Pollock, J.


This appeal requires that we determine the appropriate statute of limitations applicable to sexual-harassment actions under N.J.S.A. 10:5-13, the Law Against Discrimination (LAD). Because LAD does not contain its own statute of limitations for Superior Court actions, the issue is whether the six-year general statute of limitations, N.J.S.A. 2A:14-1,*fn1 or the two-year personal-injury statute, N.J.S.A. 2A:14-2,*fn2 should apply. The case also requires that we decide whether a single statute of limitations should apply to all LAD claims, no matter how characterized, and whether our decision should apply prospectively.

The case arises from a sexual-harassment claim filed by plaintiff, Jessica Montells, against her supervisor, Ronald Haynes; her employer, American International Adjustment Company, Inc. (AIA); its parent company; and various company managers.

In her complaint, plaintiff alleges various personal-injury claims and a LAD claim. The Law Division dismissed all the claims as barred by the two-year personal-injury statute of limitations, N.J.S.A. 2A:14-2. The Appellate Division found that the LAD claim was more like a personal-injury claim than one based on a violation of contractual rights. 258 N.J. Super. 563, 610 A.2d 898 (1992). Applying its decision retroactively, it affirmed the dismissal.

We granted certification, 130 N.J. 601, 617 A.2d 1223 (1992).

After carefully considering the purposes of LAD and of statutes of limitations, we conclude that a single statute of limitations should apply to all LAD claims. Finding that injuries under LAD are most like personal-injury claims, we further conclude that the two-year personal-injury statute of limitations should apply. We recognize that until today, the applicable statute of limitations has been unclear. In the interest of Justice, we believe that our decision should apply prospectively only. The result is that plaintiff's LAD claim is not time-barred. Consequently, we affirm in part, reverse in part, and remand to the Law Division.


Plaintiff worked for AIA as a litigation examiner from September 1986 until May 13, 1987. During that time Haynes allegedly made numerous lewd comments to her and touched her in sexually-suggestive ways. Plaintiff asserts that she complained to management officials, but that the company did not take any corrective action. According to plaintiff, the sexually-hostile environment resulted in her wrongful constructive discharge. She resigned on April 29, 1987, and left work the following week. AIA paid her salary through May 13, 1987. Plaintiff accepted a similar position with another company at higher pay, starting on May 18, 1987.

More than two years later, on May 23, 1989, plaintiff filed her complaint in the Superior Court. In count one, she alleged that Haynes' behavior had constituted sexual harassment that had created a hostile work environment in violation of LAD. In the remaining counts, she asserted seven common-law offenses: breach of covenant of good faith resulting in constructive discharge, intentional infliction of emotional distress, negligent and intentional interference with her future economic opportunity, creation of a hostile work environment resulting in constructive discharge, and both negligent and intentional assault and battery.

The common-law claims are premised on the same facts as the LAD claims. For each claim, she seeks damages for the same injuries: "[C]ompensatory damages, damages for pain, suffering and humiliation, punitive damages, attorney fees, interest and costs and such other relief as the Court deems just and proper."

Two defendants, Vincent Scarda and Maurice Greenberg, were dismissed from the case for failure of service and for lack of personal jurisdiction respectively. The remaining defendants moved for summary judgment on the grounds that the two-year statute of limitations for personal-injury actions barred the complaint.

The Law Division determined that plaintiff's cause of action had accrued no later than May 13, 1987, the last day for which she was paid. Accordingly, the court dismissed the common-law counts, implying that all those counts were subject to the two-year statute of limitations. Characterizing the LAD claim as a statutory, not a common-law, cause of action, the court concluded that the claim was governed by the six-year statute of limitations. In reaching that result, the Law Division relied on our then-recent decision, Shaner v. Horizon Bancorp, 116 N.J. 433, 561 A.2d 1130 (1989), which held that a LAD claim was essentially equitable in nature and that a LAD claimant is not entitled to a trial by jury. Because the purpose of a LAD claim is to provide equitable relief rather than to vindicate personal injuries, the Law Division in the present case concluded that the six-year statute should apply.

Thereafter, the Legislature amended LAD to provide for a jury trial in LAD cases. L. 1990, c. 12, § 2 (codified at N.J.S.A. 10:5-13). The amendment also provided that "[a]ll remedies available in common law tort actions shall be available to prevailing plaintiffs. These remedies are in addition to any legal or equitable relief provided by this act or any other statute." In another amendment, the Legislature specified the harm suffered by both the people and the State from the "personal hardships" caused by discrimination:

The Legislature further finds that because of discrimination, people suffer personal hardships, and the State suffers a grievous harm. The personal hardships include: economic loss; time loss; physical and emotional stress; and in some cases severe emotional trauma, illness, homelessness or other irreparable harm resulting from the strain of employment controversies; relocation, search and moving difficulties; anxiety caused by lack of information, uncertainty, and resultant planning difficulty; career, education, family and social disruption; and adjustment problems, which particularly impact on those protected by this act. Such harms have, under the common law, given rise to legal remedies, including compensatory and punitive damages. The Legislature intends that such damages be available to all persons protected by this act and that this act shall be liberally construed in combination with other protections available under the laws of this State.

[ L. 1990, c. 12, § 1.]

Guided by the intervening legislative amendment, the Appellate Division concluded that the two-year statute of limitations could apply to all of plaintiff's claims. Consequently, it remanded the matter to the Law Division. On remand, that court concluded that all the claims were "primarily personal in nature," and that the two-year statute should apply to those claims. Declining to apply its decision prospectively, the Law Division granted summary judgment for defendants.

The Appellate Division affirmed, reasoning that for statute-of-limitation purposes, "the gravamen of plaintiff's complaint is injury to the person." 258 N.J. Super. at 567, 610 A.2d 898. It then found that the common-law actions were barred by the two-year statute. Turning to the LAD claims, the court found "her claim once more is for personal injuries arising out of the sexual harassment and sexual discrimination under LAD." Id. at 568-69, 610 A.2d 898. The court wrote: "We find nothing in the LAD to express a legislative intent that for personal injuries sustained as a result of discrimination under LAD that the limitation for bringing such an action should be anything other than the standard statute of limitation for personal injury claims." Id. at 571-72, 610 A.2d 898 (citation omitted). ...

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