Bunk v. Port Authority of New York and New Jersey

CourtUnited States State Supreme Court (New Jersey)
Citation144 N.J. 176,676 A.2d 118
PartiesJohn R. BUNK, Petitioner-Respondent, v. The PORT AUTHORITY OF NEW YORK AND NEW JERSEY, Respondent-Appellant, and Second Injury Fund, Respondent-Appellant.
Decision Date22 May 1996

Page 176

144 N.J. 176
676 A.2d 118
John R. BUNK, Petitioner-Respondent,
Second Injury Fund, Respondent-Appellant.
Supreme Court of New Jersey.
Argued Jan. 2, 1996.
Decided May 22, 1996.

Michael D. Driscoll, New Jersey Solicitor, argued the cause for appellant The Port Authority of New York and New Jersey (Hugh H. Welsh, Deputy General Counsel, attorney; [676 A.2d 120] Mr. Welsh, of counsel; Christopher J. Neumann and George P. Cook, on the briefs).

Bertram P. Goltz, Jr., Deputy Attorney General, argued the cause for appellant Second Injury Fund (Deborah T. Poritz, Attorney General of New Jersey, attorney; Joseph L. Yannotti, Assistant Attorney General, of counsel).

Alfred G. Osterweil, Edgewater, for respondent (Cynthia A. Rollenhagen, Hackensack, attorney; Mr. Osterweil and D. John McAusland, on the briefs).

The opinion of the court was delivered by


The question in this appeal is whether a worker entitled to receive workers' compensation benefits as an employee of one of the State's bi-state agencies receives those benefits on the same terms and under the same limitations as would other public employees in the State. We hold applicable to an employee of the bi-state agency the provisions of N.J.S.A. 34:15-43 (Section 43) that limit workers' compensation benefits of public employees receiving a disability pension for the same injury.


Plaintiff, John Bunk, is an employee of the Port Authority of New York and New Jersey (the Port Authority or PA). We may also refer to him as he would be known in the compensation

Page 181

proceedings, as the "petitioner." Bunk is a resident of the State of New Jersey. On September 6, 1988, he was driving a Port Authority truck in New York City. The brakes of the truck failed. The truck struck a wall and several other vehicles, causing serious injuries to Mr. Bunk. The injuries left him unable to resume his regular employment with the Port Authority. Bunk applied for and received Social Security disability benefits. He also applied for and received a disability retirement pension from the Port Authority. (The Port Authority has elected to fund its public employees' retirement system through the New York State and Local Employees Retirement System.) The petitioner has also sought compensation for his injuries under the New Jersey workers' compensation system, N.J.S.A. 34:15-1 to -128. As a resident of New Jersey, Bunk can bring his action in New Jersey. See Parks v. Johnson Motor Lines, 156 N.J.Super. 177, 181, 383 A.2d 734 (App.Div.1978). The Compensation Judge would have awarded any necessary medical expenses for the petitioner but, believing that she was bound by Section 43, denied any award for the permanent disability related to the accident. When these proceedings commenced, Section 43 provided, in relevant part:

Every officer, appointed or elected, and every employee of the State, county, municipality or any board of commission, or any other governing body, including boards of education, and governing bodies of service districts, individuals who are under the general supervision of the Palisades Interstate Park Commission and who work in that part of the Palisades Interstate Park which is located in this State, and also [other designated persons such as volunteer firefighters] who may be injured in line of duty shall be compensated under and by virtue of the provisions of this article and article 2 of this chapter (R.S. 34:15-7 et seq.). No former employee who has been retired on pension by reason of injury or disability shall be entitled under this section to compensation for such injury or disability; provided, however, that such employee, despite retirement, shall, nevertheless, be entitled to the medical, surgical and other treatment and hospital services as set forth in R.S. 34:15-15.


Nothing herein contained shall be construed as affecting or changing in any way the provisions of any statute providing for sick, disability, vacation or other leave for public employees or any provision of any retirement or pension fund provided by law.

Page 182

N.J.S.A. 34:15-43.


[676 A.2d 121] On appeal, the Appellate Division reversed. It concluded that Hess v. Port Authority Trans-Hudson Corp., --- U.S. ----, 115 S.Ct. 394, 130 L.Ed.2d 245 (1994), had diminished the precedential value of Wright v. Port Authority of New York and New Jersey, 263 N.J.Super. 6, 621 A.2d 941 (App.Div.), certif. denied, 133 N.J. 442, 627 A.2d 1147 (1993), which had applied Section 43 to PA employees. Hess held that the PA was not, for purposes of Eleventh Amendment immunity, a public body of the State. We granted the Port Authority's petition for certification, 141 N.J. 99, 660 A.2d 1197 (1995). The Attorney General has intervened on behalf of the Second Injury Fund because the combination of this injury and other occupational diseases may have left Bunk totally and permanently disabled.


We draw upon the history set forth in the petitioner's briefs to place the issues in this case in perspective. This review is not intended as a digest of pension or workers' compensation law but only to provide a general background to the issues before us.

1911--New Jersey passed its Workers' Compensation Law. L.1911, c. 95.

1913--The Legislature passed the predecessor to Section 43 for the purpose of waiving the State's sovereign immunity to suits for workers' compensation benefits. At that time, the doctrine of sovereign immunity immunized public bodies from many forms of liability. The Legislature extended workers' compensation coverage to "[e]very employee who shall be in the employ of the State, county, municipality or any board of commission, or any other governing body...." L.1913, c. 145. Obviously, the Legislature

Page 183

did not then contemplate whether PA employees would be covered by the Act. The PA did not exist.

1921--The Port Authority was created by compact between New York and New Jersey. L.1921, c. 151. As a bi-state agency, however, its employees were not covered by the workers' compensation laws of either state. 2

1931--Language was added to Section 43 to prevent State employees from receiving disability pension benefits and later receiving workers' compensation benefits for the same injury. The text of that 1931 amendment read:

The provisions of this act shall not apply to ... any former employee who has been injured or disabled in line of duty and has been retired on pension by reason of such injury or disability. Nothing herein contained shall be construed as affecting or changing in any way ... any provision of any retirement or pension fund now or hereafter provided by law.

L.1931, c. 355.

No intent may be ascribed to the 1931 Legislature because the PA's employees were not yet covered by workers' compensation.

1951--New York and New Jersey agreed to waive the PA's sovereign immunity and consented to suits, including workers' compensation suits, against the PA. L.1951, c. 204, now codified at N.J.S.A. 32:1-157.

1951 to 1971--A number of amendments to the retirement provisions created, over the years, a dilemma for the State's public employees. A worker could retire immediately but could collect no workers' compensation benefits. In the alternative, a worker could collect workers' compensation benefits immediately but would be prevented from collecting disability benefits until the completion of the compensation award. Conklin v. City of East Orange, 73 N.J. 198, 203, 373 A.2d 996 (1977). The employee could not know in advance which award would be greater but would be limited to the option chosen initially. Ibid.

Page 184

1971--The Legislature amended various State retirement programs, the general effect of which was to allow State employees to receive both workers' compensation and disability retirement benefits with workers' compensation being offset against the retirement[676 A.2d 122] benefits. See, e.g., L.1971, c. 213. Thus, over the course of time the employee would receive the maximum possible award while still protecting the State's treasury against paying both awards in full.

The issues posed for decision against this background are: (1) whether the Legislature intends that the provisions of Section 43 that bar state employees from simultaneously obtaining accidental disability pension benefits and workers' compensation benefits apply to employees of the Port Authority, and (2) would the application of that state law to the bi-state agency impermissibly infringe on the independence of the bi-state agency.


The principles of decision are familiar, involving statutory construction and an understanding of the law dealing with bi-state agencies. We deal with the latter issue first.

The Port Authority is not the agency of a single state but rather a public corporate instrumentality of New Jersey and New York. It follows that neither creator state may unilaterally impose additional duties, powers, or responsibility upon the Authority. Nardi v. Delaware River Port Auth., 88 Pa.Commw. 558, 490 A.2d 949, 950 (1985) (citing C.T. Hellmuth & Associates, Inc. v. Washington Metro. Area Transit Auth., 414 F.Supp. 408 (D.Md.1976)). The corollary of the proposition that neither state may unilaterally impose its legislative will on the bi-state agency is that the agency may be subject to complementary or parallel state legislation. Cf. Delaware River Joint Toll Bridge Comm'n v. Colburn, 310 U.S. 419, 60 S.Ct. 1039, 84 L.Ed. 1287 (1940) (where compact prescribed procedure for land acquisition in each state, no unilateral departure could be made by agency). The illustration of parallelism that we gave in Eastern Paralyzed Veterans Ass'n v. City of

Page 185

Camden, 111 N.J. 389, 545 A.2d 127 (1988) (deciding whether complementary provisions for providing handicapped access existed in both states), was that employees of the Delaware River Port Authority must observe...

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