Thursday, January 26, 2012

The advancement of two equally plausible and reasonable interpretations of the CBA provision at issue bars a court from granting a motion for summary judgment

The advancement of two equally plausible and reasonable interpretations of the CBA provision at issue bars a court from granting a motion for summary judgment
Williams v Village of Endicott, 2012 NY Slip Op 00276, Appellate Division, Third Department

The collective bargaining agreement (CBA) in effect between the Village of Endicott and the collective bargaining representative for police officers provided that at the time the plaintiff police officers retired from the Village’s police department in 1998, the Village  "shall keep in full force and effect medical coverage and hospital coverage for each member of the bargaining unit, with benefits to be of a value at least equivalent to those presently in force[,] subject to the following conditions:

All unit members retiring during the terms of this agreement agree that subsequent to their retirement, and in consideration of [defendant's] agreement to continue their health insurance coverage, they will continue to pay a contribution toward their annual health insurance premium and such contribution shall be a sum of $500.00 per annum for family coverage, and a sum of $200.00 per annum for individual coverage."*

When Williams became eligible for Medicare Part B coverage in 2007, he was informed that the health insurance provided by Village would not cover services that would be covered under Medicare Part B, even if he failed to enroll in the program.**

As a result, Williams enrolled in Medicare Part B*** and was charged a separate premium by Medicare, which was deducted from his Social Security benefits. When Village refused [William's] request for reimbursement, Williams sued, seeking a summary judgment that the CBA required the Village to cover the costs associated with his Medicare Part B coverage. The Village also moved for summary judgment dismissing Williams' petition. Supreme Court denied both motions and both Williams and the Village appealed.

The Appellate Division said that "In determining the obligations of parties to a contract, courts will first look to the express contract language used to give effect to the intention of the parties, and where the language of a contract is clear and unambiguous, the court will construe and discern that intent from the document itself as a matter of law." Further, the court said that “Whether a contract is ambiguous is a question of law to be resolved by the court.”

Although the Appellate Division found that there was “an ambiguity as to whether Medicare Part B coverage is a component of the ‘medical coverage and hospital coverage’ that [the Village] agreed to provide to retirees under the CBA,” it also said that “On the other hand, the operative language could be read to require defendant to continue to provide and pay for a defined level of health insurance benefits — i.e, those in place at the time of retirement — without resort to any particular insurance plan or provider, subject to [William’s] $500/$200 annual contribution.”

Concluding that the parties have advanced two equally plausible and reasonable interpretations of the CBA provision in question, thereby evidencing an ambiguity that requires consideration of evidence outside the four corners of the CBA relevant to the parties' intent.”

As the scant extrinsic evidence contained in the record did not dispositively establish the scope of health insurance coverage contemplated by the parties, the Appellate Division ruled that the matter was not amenable to summary disposition.

* The court noted that the interpretation of this provision was previously before it when the Village attempted to increase the annual contributions that retirees were required to pay towards their health insurance premium (Hudock v Village of Endicott, 28 AD3d 923 [2006]). In Hudock the Appellate Division found that "the language of the CBA unambiguously provides that for all times subsequent to the retirement of [the] plaintiffs and other officers who retired while the 1996-1999 CBA was in effect, those retirees are only required to pay defendant a contribution of $500 or $200 toward their annual medical insurance 'in consideration of [Village's] agreement to continue their health insurance coverage.'"

** See §167-a of the Civil Service Law with respect to the reimbursement of Medicare premiums by the State as the employer for its retired employees and NYSHIP participating employers on behalf of their retirees. A brief history of the events leading to the enactment of §167-a is posted on the Internet at: http://publicpersonnellaw.blogspot.com/2010/05/reduction-of-medicare-premiums.html

*** Enrollment in Medicare is not required by law but if Williams refused to do so, the Village’s insurance carrier would not pay any benefits otherwise payable by Medicare, in effect forcing Williams and similarly situated retirees to enroll in Medicare or forfeit most of their health insurance benefits.

The Williams decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2012/2012_00276.htm

Handbooks focusing on State and Municipal Public Personnel Law continue to be available for purchase via the links provided below:

The Discipline Book at http://thedisciplinebook.blogspot.com/

Challenging Adverse Personnel Decisions at http://nypplarchives.blogspot.com

The Disability Benefits E-book: at http://section207.blogspot.com/

Layoff, Preferred Lists at http://nylayoff.blogspot.com/

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