Expunged Criminal Record of Employee May Be Used Against Employer In Negligent Hiring Claim

In a published Appellate Division decision, Y.H. & K.W.C. v. T.C., 2023 N.J. Super. LEXIS 27 (App. Div. Mar. 16, 2023), the Appellate Division was asked to decide whether the plaintiffs, Y.H. and K.W.C. (initials used to keep confidentiality) could utilize the expunged conviction of an Uber driver in a negligent hiring claim against Uber.  The driver, T.C., had been convicted of aggravated assault which under the Transportation Network Companies statute (the TNC), would have barred him from employment as a rideshare driver.  In this case, the Appellate Division had to weigh the protection of the expungement statute versus the laws governing rideshare drivers.

The Court noted the collision of the purposes of the underlying statutes.  The purpose of the expungement statute was “to permit a once-convicted person greater access to work opportunities, and thus second chances in life.”  However the TNC statute’s purpose was “to protect the public from potential danger when using digital rideshare services.” 

The TNC statutory provisions became effective on May 1, 2017 after the rideshare apps had been operating for years.  Essentially, these laws prohibit a TNC from “onboarding” someone with a conviction for aggravated assault as a rideshare driver.  A TNC must run a criminal background check in order to operate in New Jersey.  Pursuant to this statute, however, an applicant or driver convicted of aggravated assault shall not be disqualified as a rideshare applicant if there is a valid certificate of rehabilitation produced.  The TNC statute does not address the effect of expungements. 

The Court noted that the expungement statute was “to eliminate the collateral consequences imposed upon otherwise law-abiding citizens who have had a minor brush with the criminal justice system.”  When a Court grants an expungement, all records of the person’s arrest, conviction and any other proceedings related thereto shall be deemed not to have occurred.  The person who has had their criminal records expunged may answer any questions related to the occurrence accordingly.

There are exceptions to the use of this expungement.  Inspection of expunged files or releasing of information may be permitted by the Superior Court upon motion for good cause shown and compelling need based on specific facts.

The facts in this case are that the plaintiff’s Y.H. & his spouse, K.W.C. and Uber were the parties in this case.  The defendant T.C. was working as an Uber driver.  He picked up a passenger at a supermarket in Elizabeth when Y.H., an employee of the supermarket, confronted him for parking in a no-parking zone.  The dispute escalated and T.C. exited the vehicle and had a resulting physical encounter with Y.H.  It left him with a severed cervical spinal cord, paralyzing him from the neck down, leaving him a quadriplegic. 

Uber was sued by plaintiffs under a theory of negligent hiring or employment.  As it turns out, T.C. had been convicted of simple assault in 1991 and was arrested for aggravated assault and resisting arrest, but not convicted, in 1996.  In April 2006, however, T.C. was convicted of aggravated assault of a law enforcement officer.

On May 1, 2017, Uber authorized T.C. to drive for their platform but did not perform a criminal background check at that time.  Coincidentally, on that same day, May 1, was when the TNC Act went into effect, which required criminal background checks for TNC drivers and specifically barred those with a conviction for aggravated assault from employment as a TNC driver.

Thereafter, on July 7, 2017, and also on November 29, 2017, Uber ran background checks on T.C. which revealed his 2006 conviction.  On December 12, 2017, an amended expungement order was filed for T.C.’s convictions.

The record was unclear as to when and how Uber became aware of this expungement. But, based upon this timeline, it is clear that Uber had knowledge of T.C.’s prior conviction for aggravated assault for some period of time prior to the expungement based upon the two background checks.

Plaintiff sued T.C. for his actions, as well as Uber, claiming theories of respondeat superior and negligent hiring, training and supervision against Uber.  To pursue these claims, plaintiff sought to admit T.C.’s expunged conviction for aggravated assault.

In turn, T.C. moved to delete from the public record all references related to his expunged documentation regarding his criminal history.  Plaintiffs cross-moved to admit the same expunged information for the purposes of their negligent hiring claim against Uber.

At the trial court level, the court denied plaintiff’s motion and ordered that evidence relating to T.C.’s criminal history subject to an order of expungement could not be disclosed or otherwise used for any purpose.  The plaintiff filed an interlocutory appeal on this issue to the Appellate Division, which was accepted.

Upon appeal, plaintiffs argued that the expungement statute should only apply to the person whose conviction has been expunged by permitting such person to deny the conviction.  Plaintiffs argued that Uber’s knowledge of T.C.’s conviction for aggravated assault, which was obtained prior to that record being expunged, was vital proof of Uber’s negligence in permitting T.C. to work as a driver on their platform. 

To be able to prove the tort of negligent hiring, the plaintiff must prove that “the employer either knew or should have known that the employee was violent or aggressive, or that the employee might engage in injurious contact toward third persons.”  Plaintiffs claim that their negligent hiring claim was founded upon Uber’s knowledge of T.C.’s criminal history and that the trial court’s barring them from using this evidence effectively prevented them from proving negligent hiring by Uber.

Citing the expungement statute, the Appellate Division agreed with the trial court decision that, as to the driver T.C., whose conviction was expunged, he was entitled to the protection of that expungement order.  After the order was granted, T.C. may “rely on the court’s previous assurance he need not disclose the events of his previous conviction except in the narrow circumstances prescribed by our statute.”  Thus, that portion of the trial court’s decision was affirmed.

However, the Court found that Uber’s argument was not the same as T.C.’s argument.  The Appellate Division noted that Uber asked the Court to read the expungement statute to create a third right which would allow third parties to ignore what they already knew about a defendant, prior to the entry of an expungement order, for the purposes of extinguishing liability. 

The Court observed that the expungement statute is naturally in a state of tension with the truth.  It noted that an expungement is a legal fiction but it does not mean that the underlying reality has changed, i.e. those with expunged records were indeed convicted of an underlying offense.  The issue is whether the expungement gave Uber the ability to assert T.C.’s rights so as to imply ignorance of the assault conviction. 

The Court noted that the expungement statute directs courts to permit consideration of expunged records “upon motion for good cause shown and compelling need based on specific facts.”  The Appellate Division found that there was no way plaintiffs could prove Uber’s prior knowledge without disclosing evidence which implicated T.C.’s expunged conviction.  Hence, the Appellate Division found that this was a demonstration of a “compelling need.”

In conclusion, the Appellate Division found that the expungement statute prevented the evidence of an expunged record to be used against the person for whom the expungement is meant to benefit, i.e. the recipient of the expungement but, as for third parties, the expungement statute was less clear.  It found that the expunging statute does not automatically extend to a third party’s prior knowledge of information contained within a subsequent expungement offer.  It held that “[s]o long as the party seeking to introduce the evidence demonstrates good cause and a compelling need, courts cannot categorically bar admission of this evidence when offered to prove a third-party’s knowledge of the underlying facts.”

The Appellate Division remanded the matter back to the trial court to explore what Uber knew about T.C.’s expungement, when they knew it, or whether they knew of it at all.  The Court held that if the record demonstrated Uber was informed of the expungement prior to the events involving the plaintiff, Uber may be entitled to rely on that information as evidence of T.C.’s rehabilitation or lack of a propensity towards violence.  Thus, while the Appellate Division affirmed the order as to T.C., barring the plaintiffs from using the assault conviction against the driver, the trial court’s decision was reversed as to barring its use as to Uber. 

Tags: evidence, expungement