In Orientale v. Jennings, ___ N.J. ___, Docket No. A-43-17 (Sept. 23, 2019), the New Jersey Supreme Court established new requirements governing the use of additur or remittitur in New Jersey courts. Now, where the trial judge believes that a jury’s award is so grossly excessive or grossly inadequate that it shocks the judicial conscience, the trial court may grant a new trial or offer the parties a remittitur or an additur. Unless the parties agree on an remittitur or an additur, the trial court must grant a new trial.
Additur and Remittitur
Additur and remittitur are judicial remedies intended to correct a damages award constituting a manifest injustice. Additur is a trial court order that increases a jury award to avoid a new trial on grounds of inadequate damages. Remittitur, on the other hand, is a trial court order decreasing the jury award. Additur and remittitur are rarely applied because they are in direct conflict with the right to trial by jury, allowing a trial judge to supersede his or her judgment over that of the jury. Prior to Orientale, in New Jersey, only one party needed to consent. That is, with additur, the trial court would order a new trial unless the defendant consented to the increase in the award. Or, with remittitur, unless the plaintiff consented to the decrease in the award.
The Facts in Orientale
The plaintiff was injured in a motor vehicle accident. The defendant maintained an automobile insurance policy of $100,000. After the court determined that the defendant was 100% responsible for the crash, the parties settled for the entire $100,000 insurance policy.
The plaintiff maintained an underinsured motorist policy with her insurer that provided coverage for damages up to $250,000. Underinsured motorist coverage provides coverage to the policyholder if she suffers personal injury or property damage caused by a motorist’s negligent operation of a vehicle and the negligent motorist’s liability insurance is insufficient to reimburse the policyholder’s damages. The plaintiff then initiated a claim with her insurance carrier for the damages she sustained in the accident in excess of the defendant’s $100,000 policy.
Following a trial, the jury returned a verdict finding that the plaintiff had suffered a permanent injury, but only awarding her damages in the amount of $200. The plaintiff moved for a new trial on the basis that the jury award was unjust. The trial court agreed and vacated the damages award, finding that it constituted a miscarriage of justice. The trial court granted an additur in the amount of $47,500, which the plaintiff’s insurance carrier agreed to. The plaintiff then appealed.
The NJ Supreme Court’s Holding
After examining the history of additur and remittitur going back hundreds of years, the New Jersey Supreme Court held that the current practice of allowing only one party to consent to addititur or remittitur “places the parties on an unequal footing, cannot be squared with fundamental notions of fairness and cannot be justified in the name of judicial efficiency or cost effectiveness.” The court explained that “in the unusual case where a damages award was grossly excessive or grossly inadequate, the trial court retains the power to declare that a jury’s damages award shocks the conscience and to grant a new trial or offer the parties a remittitur or an additur.” Accordingly, “[g]oing forward … unless both parties consent to a remittitur or an additur, the court must grant a new trial.”
Because the plaintiff did not consent to the addititur, the court reversed the trial court and remanded for a new trial.
