Legal Memorandum: Retroactive Application of Laws in NJ

Issue: Whether the New Jersey Supreme Court’s decision in Alexander v. Seton Hall University, 204 N.J. 219, 8 A.3d 198 (2010) could apply retroactively to a claimant’s 2002 claims so as to bar any N.J. Law Against Discrimination claims outside the two-year statute of limitations.

Area of Law: Employee Law, Litigation & Procedure
Keywords: Retroactive application of laws; Discriminatory wage claims; Concomitant limitation on damages
Jurisdiction: New Jersey
Cited Cases: 153 N.J. Super. 470; 118 N.J. 89; 380 A.2d 285; 173 N.J. Super. 249; 58 N.J. 410; 133 N.J. 282; 204 N.J. 219; 414 A.2d 30; 64 N.J. 464; 190 N.J. 14; 918 A.2d 14; 570 A.2d 903; 627 A.2d 654; 679 A.2d 634; 99 N.J. 8
Cited Statutes: N.J. Stat. § 2A:14-2(a), § 10:5-1
Date: 10/01/2011

Although there are many appropriate instances in which new laws will not be applied retroactively, there is also some authority for the proposition that the Alexander rule could apply in some situations.  In fact, even if Alexander were deemed to have overruled prior precedent, the New Jersey Supreme Court has "generally followed the traditional rule that the overruling of a judicial decision is retrospective in nature."  See Rutherford Educ. Ass’n v. Bd. of Educ., 99 N.J. 8, 21, 489 A.2d 1148 (1985) (emphasis added) (citing many New Jersey cases as examples). The basis for the doctrine of retrospective application is pragmatic rather than theoretical, resting on the judicial perception that ordinarily "a weighing of the various policies involved called for retrospectivity."  Id., 99 N.J. at 21 (citing Darrow v. Hanover Twp., 58 N.J. 410, 413-14 (1971)).  Accordingly, there is a presumption in favor of retrospectivity, and "that presumption can be overcome only by a clear demonstration in a particular case that there are sound policy reasons for according a judicial decision prospective application only."  Id. (citation omitted).

As explained in Rutherford, the threshold inquiry in any decision regarding retroactivity is whether a new rule of law has actually been announced.  Id. (citing State v. Burstein, 85 N.J. 394 (1981)).  If a judicial decision has indeed made a new rule, the court has four options: (1) make the new rule purely prospective, applying it only to cases with operative facts that arose after […]

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