On June 29, 2018, a New Jersey state appeals court ruled that a superior court improperly allowed a jury to consider evidence, not represented at trial, in allocating damages among nine defendants in an asbestos case. The state appeals court ordered a new trial in Rowe v. Bell & Gossett Company to address the issue of re-apportioning the $1,500,000.00 jury verdict.

Throughout Ronald Rowe’s thirty-plus year career working as an automobile mechanic, and repairing and servicing boilers, Rowe claims he was exposed to asbestos from a variety of sources. On April 27, 2015, a jury found that Rowe’s exposure to hardened cement manufactured by Universal Engineering Co., Inc. (Universal), was a substantial factor causing Rowe’s mesothelioma. The jury also found Rowe’s exposure to asbestos from the products of the eight defendants that previously settled the case to be a substantial factor causing his mesothelioma. The jury allocated twenty percent of the damages to Universal and apportioned the remaining eighty percent among the eight defendants that had previously resolved the case.

Donna Rowe appealed the April 27, 2015 jury verdict on behalf of her husband who died of mesothelioma on April 8, 2015. In one of several points raised on appeal, Donna Rowe argued that Universal relied on improperly admitted evidence in proving its apportionment claim. At trial, the court allowed Universal to admit settled defendants’ answers to interrogatories. The trial court reasoned that because Universal asserted cross-claims against the settled defendants, the answers to interrogatories were admissible, even if those interrogatory answers were served in an unrelated matter, outside New Jersey. The judge also allowed Universal to read sections of depositions of corporate representatives of the settled defendants, to help substantiate Universal’s apportionment claim. The trial judge relied on Universal’s representation that the representatives of the eight settling defendants were outside the jurisdiction of the court and unavailable for trial.

The Superior Court of New Jersey, Appellate Division agreed with Donna Rowe, ruling that the trial judge erred in admitting evidence pertaining to the settled defendants, which was not exempt from the general prohibition against admission of hearsay.  When addressing the answers to interrogatories, the appeals court noted that both N.J. Court Rule 4:16-1(b) and N.J.R.E. 803(b)(1) only allow statements “against” the statement-maker. Here, the appeals court noted, the evidence pertaining to the settled defendants was offered only against the plaintiff, and not against the settled defendants.  The appeals court reasoned, that the jury’s determination as to the settled defendants would only impact the plaintiff’s recovery against Universal. The appeals court went on to label the settled defendants’ “party” status as irrelevant in determining the evidentiary issue at hand. The appeals court re-iterated its focus on against whom the answer to interrogatories were offered in determining the admissibility of such evidence.

In its analysis, the appeals court also recognized the rationale for allowing the admission of interrogatory answers and deposition testimony against a statement-maker. When in a courtroom, the statement-maker has a fair opportunity to respond to this evidence. When the trial court allowed Universal to admit evidence concerning the settled defendants, Universal “transform[ed] statements of [the] settl[ed] defendants into unrebuttable admissions to be used against a party that did not make those admissions.” See Rowe v. Bell & Gossett Co., No. A-4530-14T2, 2018 N.J. Super. Unpub. LEXIS 1560 (Super. Ct. App. Div. June 29, 2018).

Before addressing Rowe’s additional points on appeal, the court conceded that Universal may, on retrial, produce sufficient proofs to enable it to satisfy the requirements of the New Jersey Comparative Negligence Act and thus, still potentially benefit from apportionment. The New Jersey appeals court seems to imply that if Universal presents proofs against the statement makers, and adequately demonstrates the unavailability of witnesses, a jury may properly use evidence concerning the settled defendants to evaluate the apportionment of the $1,500,000.00 jury verdict.

On July 18, 2018, Hilco, Inc., the successor-in-interest to Universal, filed a notice of petition for certification with the New Jersey Supreme Court. As of August 16, 2018, the case is pending certification by the New Jersey Supreme Court.