07-11-08 A-4421-06T3
In this case a party sought to limit its duty to indemnify a public entity based on two statutes limiting recoveries against public entities.
The public entity settled a personal injury claim brought by a worker injured on the job and employed by the general
contractor. When the public entity sought contractual indemnification from the general contractor, the general
contractor contended that it was entitled to a deduction for the workers' compensation benefits it had paid to the injured
worker. While N.J.S.A. 59:9-2(e) allows a public entity to deduct from a judgment the amount of workers' compensation
benefits the plaintiff received for the injuries, that statute does not apply to settlements. When negotiating the settlement
sum, the parties would take into account the fact that if the case went to judgment the public entity would receive the
deduction.
Since the contract provided that the public entity was entitled to indemnification for the general contractor's
negligence and not for its own negligence, a jury trial was held to allocate responsibility for the accident between the public
entity and the general contractor, and the general contractor was found to be eighty-five percent at fault. As a result, the
general contractor must indemnify the public entity for eighty-five percent of the settlement sum. We reject the general
contractor's argument that since a public entity is only responsible for the damages attributable to its percentage of
negligence, under N.J.S.A. 59:9-3.1, the public entity's indemnification could not exceed fifteen percent of the
settlement. Affirmed.
