The Admission Agreements for nursing homes under the consumer fraud act was recently analyzed by the court.
The New Jersey CFA prohibits: “The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby….
To sustain a claim of violation of the CFA, plaintiff must prove three elements: “1) unlawful conduct by defendant; 2) an ascertainable loss by plaintiff; and 3) a causal relationship between the unlawful conduct and the ascertainable loss. The Court noted that “[e]ach of the elements of the prima facie case is found within the plain language of the statute itself; each is, without any question, a prerequisite to suit.” Plaintiff cannot satisfy the first indispensable element, as we have concluded that the Admission Agreement is lawful.
A court will also reject plaintiff’s assertion of a CFA violation as it applies to a nursing home in light of the learned professional exception that precludes its application to the nursing home. The “learned professional” exception, established during forty years of the law’s jurisprudence, “continues to identify learned professionals as beyond the reach of the Act so long as they are operating in their professional capacities.” The initial rationale for the exception is premised on the nature of the professional’s activity as “something beyond the ordinary commercial seller of goods or services.” The learned professional exception has been extended to recognize that “uniform regulation of an occupation, where such regulation exists, could conflict with regulation under the CFA.” where the Court expressed a reluctance to permit a situation “where separate state agencies would have the right to exercise concurrent jurisdiction and control over billings, with a real possibility of conflicting determinations, rulings and regulations affecting the identical subject matter”).
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