Some reasons why motions to dismiss an Article 78 action relying on the doctrines of res judicata, collateral estoppel or an alleged "failure to exhaust administrative remedies" may be rejected by a court

Among the issues addressed by the Appellate Division in its review of an appeal from an Article 78 decision by Supreme Court was the authority of a school superintendent to suspend a high school principal.

Noting that Education Law §2566(6) grants a superintendent limited authority "to suspend a ... principal ... until the next regular meeting of the board, when all facts relating to the case shall be submitted to the board for its consideration and action,"  the Principal alleged that the City School District's Board of Education [Board] never ratified or approved her suspension at "the next regular meeting of the board," and therefore there was no authority for her continued suspension.

In rebuttal, the Board contended that the issue was considered in the course of an earlier arbitration* and thus judicial review of the Principal's claim was barred by the doctrines of res judicata and collateral estoppel.** 

The Appellate Division disagreed with the Board's argument, explaining that the issues raised in this litigation by the Principal were not identical to those raised during the prior arbitration. Accordingly, the court ruled that neither doctrine served as a bar to judicial review of the issue under the circumstances.

Another argument advanced by the Board was that Principal had failed to exhaust her administrative remedies prior to commencing this Article 78 action. Principal, however, argued that "exhaustion of administrative remedies" was not a condition precedent to initiating litigation in this instance.

Noting that the Principal had, in fact, filed a "contract grievance" based on an alleged violation of the relevant collective bargaining agreement, the Appellate Division opined that this was of no moment because "[t]he issues presented and the remedies sought in each forum were separate and distinct." Thus, explained the court, exhaustion of administrative remedies provided by a collective bargaining agreement is not necessary "where, as here, the [Principal] alleges violations of the Education Law, not violations of the agreement."

Further, said the court, although Education Law §310 provides, in relevant part, that any party aggrieved by an official act or decision of school authorities "may appeal by petition to the [C]ommissioner of [E]ducation," the Commissioner exercises primary jurisdiction only where the matter involves an issue requiring his or her specialized knowledge and expertise. Here, however, the Appellate Division concluded that Principal's contention with respect to §2566 of the Education Law "requires no more than the interpretation and application of the plain language of that statute for which no deference to the [Commissioner of Education] is required."

Finally, the Appellate Division found that the Article 78 petition had not been rendered moot as the result of a subsequent investigation into additional alleged improprieties by the Principal as the Board had neither alleged nor submitted evidence that the Board, in contrast to the Superintendent, had suspended the Principal in compliance with Education Law §2566(6) in connection with such new allegations.

The Appellate Division reversed the Supreme Court's judgment [1] "insofar as appealed from," [2] reinstated Principals' petition, and [3] gave the Board "20 days from service of the order of this Court with notice of entry to serve and file an answer" to Principal's Article 78 action.

* The arbitration resolved whether the placement of an employee on paid administrative leave pending an investigation into allegations of misconduct constituted a violation of Article 4A of the controlling collective bargaining agreement. Article 4A provided that "no administrator shall be disciplined, reprimanded, reduced in rank or compensation or deprived of any professional advantage without cause."

** The doctrines of res judicata and collateral estoppel, sometimes referred to as "issue preclusion,"  bar the relitigation of a "cause of action" once there has been judicial or quasi-judicial decision concerning the issue on its merits.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2019/2019_05895.htm

New York State Governor Andrew M. Cuomo signs legislation enacting sweeping new workplace harassment protections

On August 12, 2019Governor Andrew M. Cuomo signed legislation (S.6577/A.8421) to enact sweeping new workplace harassment protections, fulfilling a key component of Governor Cuomo's 2019 Women's Justice Agenda by:

1. Eliminating restriction that harassment be "severe or pervasive" in order for it to be legally actionable;

2. Mandates that all employment contract non-disclosure agreements [NDAs] include language allowing employees to file a complaint of harassment or discrimination; and

3. Extends statute of limitations for employment sexual harassment claims filed from one year to three years.

To further protect workers and hold abusers accountable, this legislation:

Lowers the high bar set for employees to hold employers accountable for sexual harassment by amending under the New York Human Rights Law to make clear that conduct need not be  "severe or pervasive" to constitute actionable conduct;

Protects employees' rights to pursue complaints by mandating that all non-disclosure agreements in employment contracts include language stating that employees may still file a complaint of harassment or discrimination with a state or local agency and testify or participate in a government investigation;

Extends the statute of limitations for employment sexual harassment claims filed with the Division of Human Rights from one year to three years;

Requires employers to provide their employees with notice about the employer's sexual harassment prevention policy in English as well as the employee's primary language;

Expands the coverage of the Human Rights Law to all employers in the state;

Extends protections against all forms of discrimination in the workplace to all contractors, subcontractors, vendors, consultants, or others providing services; and against all forms of discriminatory harassment to domestic workers;

Requires courts to interpret the Human Rights Law liberally regardless of the federal rollback of rights;

Prohibits mandatory arbitration to resolve cases of discrimination and harassment in the workplace;

Updates the power of the Attorney General to enforce the Human Rights Law; and

Requires a study on how best to build on recent sexual harassment prevention laws to combat all types of discrimination in the workplace and a review of sexual harassment policies every four years.

A copy of the text of this measure is available from NYPPL as an attachment to an e-mail. Send your request to publications@nycap.rr.com with "workplace harassment protections" as the subject.

Imposing different penalties on employees involved in a physical confrontation alleged to constitute discriminatory disciplinary action

If two workers get involved in a physical confrontation, must the employer mete out the same disciplinary penalty to each?

A technician [Technician] and her superior, a Team Leader, [Leader] were pointing their fingers at each other, presumably to emphasize points that they were making. When Leader grabbed Technician 's finger, Technician responded by slapping Leader.

The Employer dismissed the Technician. Technician sued, complaining that her termination constituted "discriminatory disciplinary action" because Leader had not been terminated as well.

The Circuit Court rejected Technician 's theory, commenting that Employer was not required to treat each "escalation" of the confrontation - finger pointing to finger grabbing to slapping - the same. In addition, the Court said another factor was that the two employees did not hold positions of similar rank. The decision by the Eighth Circuit U.S. Court of Appeals also indicates that while Leader "had a spotless disciplinary record, Technician had a record of disciplinary problems."

The court upheld Technician's dismissal, commenting that the respective actions by Leader and Technician "are clearly differentiated because the incident involved two separate levels of escalation" ranging from the mutual pointing of fingers to a slap in retaliation for the grabbing of the finger.

The decision is posted on the Internet at:

https://www.leagle.com/decision/19961042920fsupp12211007

New York State's Human Rights Law amended to prohibit employment discrimination because of religious attire or facial hair

On August 9, 2019 New York State's Governor Andrew M. Cuomo signed legislation* prohibiting employment discrimination based on religious attire, clothing or facial hair. The new law amends the New York State Human Rights Law to make clear that employers cannot refuse to hire, attain, promote, or take other discriminatory action against an individual for wearing attire or facial hair in accordance with tenets of their religion. 

 

The legislation makes clear the protections of the New York State Human Rights Law, which also prohibits employers from treating applicants or employees differently because of that person's religious beliefs, and it requires employers to reasonably accommodate an employee's religious practices. The new law reaffirms the Governor's longstanding commitment to religious inclusion and equality.

The Act amends §296.10(a) of the Executive Law, New York State's Human Rights Law, to read as follows:**

                                                                  

(a) It shall be an unlawful discriminatory practice for any employer,  or an employee or agent thereof, to impose upon a person as a condition of obtaining or retaining employment, including opportunities for promotion, advancement or transfers, any terms or conditions that would require such person to violate or forego a sincerely held practice of his or her religion, including but not limited to the observance of any particular day or days or any portion thereof as a sabbath or other holy day in accordance with the requirements of his or her religion or the wearing of any attire, clothing, or facial hair in accordance with the requirements of his or her religion, unless, after engaging in a bona fide effort, the employer demonstrates that it is unable to reasonably accommodate the employee's or prospective employee's sincerely held  religious observance or practice without undue hardship on the conduct of the employer's business. Notwithstanding any other provision of law to the contrary, an employee shall not be entitled to premium wages or premium benefits for work performed during hours to which such premium wages or premium benefits would ordinarily be applicable, if the employee is working during such hours only as an accommodation to his or her sincerely held religious requirements. Nothing in this paragraph or paragraph (b) of this subdivision shall alter or abridge the rights granted to an employee concerning the payment of wages or privileges of seniority accruing to that employee.

The amendment takes effect "on the sixtieth day after it shall have become a law."

* Senate 4037, Assembly 4204

** The text set out in blue and underscored is new.

Judicial proceeding may be stayed pending completion of an arbitration where the determination of issues alleged in the demand for arbitration may also dispose of the nonarbitrable matters

Paragraph 4(b) of the consulting agreement [Agreement] between the Plaintiff and the Defendant addresses Defendant's right to terminate the agreement "for cause" and concludes as follows: "Any dispute between the parties shall be resolved first by submitting same for mediation to AAA, and absent a resolution, then by a 3 member panel Arbitration through AAA."

Following the termination of the Agreement, allegedly "for cause," Plaintiff commenced an action for "breach of contract" after Defendant failed to pay Plaintiff the consulting fee and performance bonus Plaintiff contended were due Plaintiff under the terms of the Agreement.

Defendant, citing the arbitration clause set out above, moved pursuant to CPLR §7503(a) to compel arbitration and to stay Plaintiff's "breach of contract" action pending completion of the arbitration.

Plaintiff opposed Defendant's  motion on the grounds that the clause Defendant was relying upon applied only to disputes relating to termination and not to actions alleging breach of contract. In rebuttal, and without conceding that the scope of the arbitration clause was limited to the resolution of disputes involving termination, Defendant argued it had not paid Plaintiff as the Agreement was "terminated for cause." Supreme Court denied Defendant's motion, and Defendant appealed.

The Appellate Division vacated the lower court's ruling, opining:

1. Defendant's contentions with respect to Plaintiff's termination for cause in response to allegations first made by Plaintiff in opposition to Defendant's motion to compel arbitration were properly raised;

2. It was undisputed that Paragraph 4(b) of the consulting agreement applies, "at minimum, to any dispute regarding the Plaintiff's claims, including objections with respect to the existence, scope or validity of the arbitration agreement";

3. In the event arbitrable and nonarbitrable claims are inextricably interwoven, the proper course is to stay judicial proceedings pending completion of the arbitration, particularly where the determination of issues in arbitration may well dispose of nonarbitrable matters" and

4.  Even assuming, without deciding, that the only arbitrable dispute is whether the Agreement was properly terminated for cause, judicial proceedings should be stayed until that issue is resolved, since that determination may also dispose of Plaintiff's breach of contract cause of action.

Accordingly, the Appellate Division ruled that Supreme Court should have granted Defendant's motion to compel arbitration of the matter.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2019/2019_06073.htm

Anastasia Titarchuk named Chief Investment Officer of the New York State Common Retirement Fund

New York State Comptroller Thomas P. DiNapoli today announced his appointment of Anastasia Titarchuk as Chief Investment Officer [CIO] of the New York State Common Retirement Fund. Titarchuk has served as the Fund’s interim CIO since July 2018.

Titarchuk was born in Moscow and moved to the U.S. as a teenager. She graduated Summa Cum Laude from Yale University with a B.S. in Applied Mathematics. Over the course of two decades she worked in a variety of roles on Wall Street, including emerging markets, interest rates trading and equity derivatives marketing. She joined DiNapoli’s office in 2011 as part of the Fund’s ARS team and served as Deputy CIO under then-CIO Vicki Fuller. She was appointed interim-CIO in July 2018.

The New York State Common Retirement Fund is the third largest public pension fund in the United States, with an audited value of $210.5 billion as of March 31, 2019. The Fund holds and invests the assets of the New York State and Local Retirement System on behalf of more than one million state and local government employees and retirees and their beneficiaries. 

The Fund has a diversified portfolio of public and private equities, fixed income, real estate and alternative instruments and has consistently been ranked as one of the best managed and best funded plans in the nation. "Through prudent management, the Fund has maintained its status as one of the nation’s strongest and best funded and I know that Anastasia will continue to uphold high standards for the pension system’s 1.1 million members, retirees and their beneficiaries.”

Summaries of recent findings and recommendations of New York City Office of Administrative Trials and Hearings [OATH] Administrative Law Judges.

N.B. For information concerning the disposition of the matter by the relevant appointing authority, please telephone OATH's Calendar Unit at 1-212-933-3097.

                  

Former Deputy Commissioner classified certain agency employees improperly

A former Deputy Commissioner and staff analyst [Respondent] was charged with inaccurately designating 30 agency employees as performing exclusively Medicaid work. The improper designation resulted in the reimbursement of over $7 million from the State which had to be refunded. The analyst testified that he was aware that Medicaid-funded staff had to perform exclusively Medicaid duties, and conceded that between 2015 and 2017, most of the employees were improperly classified.

Administrative Law Judged [ALJ] John B. Spooner found the charges were not time-barred because the conduct charged would constitute a crime and thus fell under the crimes exception to limitations provision of §75(4) of the Civil Service Law.

Finding that the analyst’s motive for maintaining the falsehood was to protect his division from losing staff, ALJ Spooner sustained the charges and recommended termination of Respondent’s employment.

The full text of the decision, OATH Index No. 1236/19, is posted on the Internet at: http://archive.citylaw.org/wp-content/uploads/sites/17/oath/19_cases/19-1236.pdf

Employee found guilty of submitting a misleading report

A special officer [Respondent] employed at a men’s shelter was charged with using excessive force to unlawfully restrain a shelter client and with submitting a false statement about the incident.

Video footage showed the client engaging in a prolonged verbal dispute with another special officer. Without justification, that second officer approached and shoved the client backwards. The client pushed back and a struggle ensued between the client, the second officer, and a third officer who had joined in to try to force the client to the ground. As the client was resisting attempts to wrestle him to the ground, Petitioner grabbed his leg. The client fell to the ground with the other two officers on top of him. Respondent let go of the client’s leg and did not physically touch him again except to help handcuff his hands behind his back.

ALJ Faye Lewis found that even though the initial force by the second officer was not justified, once the client began to resist, the Appointing Authority failed to establish that Respondent assisting in handcuffing him. This was limited force appropriate under the circumstances.

However, ALJ Lewis sustained the false statement charge. Respondent submitted a report in which she stated that the house manager requested that the client be detained as an emotionally disturbed person. Respondent admitted at trial that she did not hear the house manager say this, but relied upon information provided to her by another officer. By signing the report, she represented that the report contained her observations. Because this was not true, Respondent’s report was misleading. For the proven false statement charge, ALJ Lewis recommended a ten-day suspension with credit for time served. 

The full text of the decision, OATH Index No. 587/19, is posted on the Internet at:

http://archive.citylaw.org/wp-content/uploads/sites/17/oath/19_cases/19-587.pdf

Using the agency’s mail system for personal correspondence

An associate contract specialist [Respondent] was charged with committing an act relating to her office which constitutes an unauthorized exercise of her official function, engaging in non-Department business during working hours and mailing personal correspondence using the Department’s mail system.

The charges arose from allegations that Respondentused her job with the Department and Department resources to secure summer jobs for her foster son and his friend.

A Department official responsible for overseeing youth employment programs testified that Respondent called her, identified herself as a Department employee, and asked to discuss her foster son’s status. The official testified that Respondent’s foster son had already been accepted to the program, and the official testified that she did not take any additional action on his behalf as a result of Respondent’s call.

Respondent later called a youth employer on behalf of her foster son’s friend, identified herself as a Department employee, and implied that she was calling on behalf of the Department. For several months, Respondentwas in contact via her work email and phone with the youth employer to correct issues with the friend’s time sheets. The employer testified that they would not have offered a job to the friend if the Respondent had not made the initial call.

ALJ Joycelyn McGeachy-Kuls recommended dismissal of the first charge, finding the Appointing Authority failed to prove respondent committed an act relating to her office which constituted an unauthorized exercise of her job function, because youth employment was not part of her job. She also recommended dismissal of the second charge because the Appointing Authority did not prove that Respondent made the phone calls or the emails during work hours.

ALJ McGeachy-Kuls, however, sustained the charge that Respondent used the agency’s mail system for personal correspondence, and she recommended a five day suspension in light of the fact that Respondent had no prior disciplinary record. 

The full text of the decision, OATH Index No. 1995/18, is posted on the Internet at:

http://archive.citylaw.org/wp-content/uploads/sites/17/oath/18_cases/18-1995.pdf

A vested right to retirement benefit to be provided by a New York State public retirement system may neither be diminished nor impaired "retroactively"

A 1957 decision of the New York State Comptroller provided for the inclusion of cash payments for accumulated vacation credits* in determining a member's "final average salary" for the purpose of computing the member's retirement benefits. In 1971 the Retirement and Social Security Law [RSSL] was amended** and eliminated the inclusion of cash payments for accumulated vacation credits in determining a member's retirement allowance.

When the Comptroller thereafter applied RSSL §431.1, as amended, to certain retiring members [Plaintiffs] of the retirement system who joined the system prior to the effective of the amendment, they challenged to "retroactive application" of the amendment with respect to the calculation of their retirement allowances, contending that such action constituted a violation of §7(a) of Article V of the New York State Constitution if retroactively applied to the Plaintiffs and others similarly situated.

The Court of Appeals agreed,*** opining that the Comptroller's 1957 decision constituted "a valid contract between the State Employees' Retirement System and its members" and if retroactively applied to the Plaintiffs and others similarly situated would constitute a violation of Article V, §7(a)**** of the State Constitution. In other words, pre-amendment members of the retirement system acquired a vested right to the benefit flowing from the 1957 decision by the Comptroller and "that benefit may not now be constitutionally impaired."

In contrast, insofar as members joining the Retirement System on or after the effective of the 1971 amendment to the RSSL are concerned, the Court of Appeals noted that such new entrants "acquired contractual rights subject to any statutes then outstanding, whether or not by the terms of the statutes they applied to current or future events."

In the words of the court,  "subdivision 1 of section 431 of the Retirement and Social Security Law ... which eliminates inclusion of cash payments for accumulated vacation credits, violates section 7 of article V of our State Constitution if retroactively applied to the plaintiff and others similarly situated." In other words, the change could only be applied to individuals becoming members of the retirement system on or after the effective date of the change.

* Such payments, said the court, represented "compensation for services actually rendered and are, therefore, properly includable in the computation of a member's final average salary."

** Chapter 503 of the Law of 1971 amended §431.1 of the Retirement and Social Security Law.

*** Kranker v Levitt, 30 NY2d 574.

**** Article V §7(a) provides that "After July first, nineteen hundred forty, membership in any pension or retirement system of the state or of a civil division thereof shall be a contractual relationship, the benefits of which shall not be diminished or impaired."

The decision is posted on the Internet at:

https://www.leagle.com/decision/197260430ny2d5741493

Evaluating a public employer's duty to defend and indemnify an employee named as a defendant in an "underlying action"

The City of Buffalo [Respondent] appealed from a judgment of Supreme Court denying its motion to dismiss the petition of two police officers [Officer A and Officer B] seeking a court order directing the Respondent to provide for their defense and indemnification* in an underlying action brought against them by a nonparty to this CPLR Article 78 proceeding.

Petitioners commenced their Article 78 proceeding after Respondent determined that it would not provide them with a defense or indemnification in the underlying action. Supreme Court ordered the Respondent to provide for a defense and indemnification of both Officer A and Officer B in the underlying action, whereupon the Respondent appealed the ruling to the Appellate Division.

The Appellate Division said it agreed with the Respondent that Supreme Court erred in granting the petition with respect to Officer A by denying that part of the Respondent's motion seeking to dismiss the petition as to Officer A on the ground that he failed to timely commence this proceeding. Accordingly, the Appellate Division so modified the Supreme Court's judgment with respect to Officer A.

In contrast, the Appellate Division said Supreme Court "properly determined, however, that Respondent's determination not to provide [Officer B] with a defense was arbitrary and capricious, noting that the Respondent's determination concerning Officer B was based on its conclusion that Officer B was acting outside the scope of her employment at the time of the incidents concerning the plaintiff in the underlying action.

The Appellate Division, observing that "it is undisputed that [Officer B] was on duty and working as a police officer when the alleged conduct occurred," opined that the facts that Officer B pleaded guilty to a disciplinary charge in connection with her conduct that gave rise to the underlying action "cannot establish, as [Respondent] must, that [Officer B's] was acting outside the scope of her employment at the time of the incidents concerning the plaintiff in the underlying action" by showing that Officer B's actions were "wholly personal" in nature.

Accordingly, the Appellate Division concluded that Supreme Court's determination that Officer B is entitled to indemnification was "premature at this time" and then elected to "further modify the [Supreme Court's] judgment accordingly."

* Presumably Officers A and B sought the Respondent's providing for their "defense and indemnification" pursuant to Public Officers Law §18, a provision in a collective bargaining agreement or as otherwise authorized by law, rule or regulation. §18 provides for the defense and indemnification of officers and employees of public entities which are defined as "(i) a county, city, town, village or any other political subdivision or civil division of the state, (ii) a school district, board of cooperative educational services, or any other governmental entity or combination or association of governmental entities operating a public school, college, community college or university, (iii) a public improvement or special district, (iv) a public authority, commission, agency or public benefit corporation, or (v) any other separate corporate instrumentality or unit of government; but shall not include the state of New York or any other public entity the officers and employees of which are covered by section seventeen of this chapter or by defense and indemnification provisions of any other state statute taking effect after January first, nineteen hundred seventy-nine."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2019/2019_05877.htm

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Determining the date on which the four month statute of limitations for filing a timely CPLR Article 78 action begins to run

The Court of Appeals has defined "final and binding" in terms of completeness and exhaustion of administrative remedies as follows: "[f]irst, the agency must have reached a definitive position on the issue that inflicts actual, concrete injury and second, the injury inflicted may not be . . . significantly ameliorated by further administrative action or by steps available to the complaining party."*

Petitioner [Plaintiff] commenced this CPLR Article 78 proceeding seeking to compel the New York State Department of Education [DOE] to issue a school building leader certificate for which he had applied in 2014. DOE, contending that Plaintiff had not paid a necessary fee before the applicable deadline, had declined to issue the certificate and issued a notice of uncompleted requirements for certification on July 23, 2014. Plaintiff was also advised that he would be required to meet newly-enacted examination requirements.

In June 2016 inquiry Plaintiff contacted DOE concerning the status of his application. DOE responded, citing its July 2014 notice of uncompleted requirements. Ultimately DOE, in response to Plaintiff additional inquiry and request for "an official appeal," sent Plaintiff two documents dated December 9, 2016 entitled "Notice of Uncompleted Requirements for Certification" explaining that Plaintiff's application had been disapproved and restated that there was "no legal means by which [DOE could] overlook" the initial missed deadline for the required payment.** Plaintiff was also advised that should he wish "to further pursue the certification, he would need to reapply and meet all additional requirements."

DOE moved to dismiss Plaintiff's petition as untimely because the proceeding was commenced on April 28, 2017, more than four months after DOE's issued its December 9, 2016 determination. In rebuttal, Plaintiff contended that the statute of limitations began to run when he received the second, identical, notice dated January 3, 2017. Supreme Court granted DOE's motion to dismiss the petition, and Plaintiff appealed.

The Appellate Division sustained the Supreme Court's ruling, explaining that the definitive position stated in DOE's January 2017 notice is no different from that DOE expressed in its initial December 2016 notice. Further, said the court Plaintiff "does not argue that he was attempting to pursue further administrative remedies or took any additional action after the December 2016 notice was issued."

Accordingly, the Appellate Division ruled that Supreme Court's dismissal of Plaintiff's petition as untimely was correct, noting that DOE's determination became final and binding and the statute of limitations period began to run on December 9, 2016. Further, said the court, although there is a potential for prejudice in a case where a petitioner receives a subsequent, additional notice and then provides that postdated determination to his or her attorney, in this instance the Appellate Division opined "that no such prejudice has been alleged, nor was any justification for petitioner's failure to commence a proceeding based upon the December 2016 notice provided."

* See Walton v New York State Dept. of Correctional Servs., 8 NY3d 186, quoting Matter of Best Payphones, Inc. v Department of Info. Tech. & Telecom. of City of N.Y., 5 NY3d 30.

** The Appellate Division's decision notes that "for reasons still unknown and unexplained within the record or briefs," DOE issued the second identical notice dated January 3, 2017.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2019/2019_05610.htm

Releasing annual employee financial disclosure statements to the public

The petitioner [Plaintiff] in this CPLR Article 78 action challenged the Suffolk County Legislature action [Resolution] directing the Suffolk County Board of Ethics [Board] to provide the Plaintiff's financial disclosure statements to the Ways and Means Committee of the Suffolk County Legislature. Supreme Court denied Plaintiff's petition and dismissed the proceeding whereupon Plaintiff appealed the lower court's determination, contending that the County Legislature's Resolution was, inter alia, arbitrary and capricious, an abuse of discretion, and in excess of the County Legislature's authority.

Suffolk County, as authorized by General Municipal Law §811(1), had adopted a local law requiring certain county employees to file annual financial disclosure statements with the Board. The Board was required to review each financial disclosure statement filed with it and determine whether there had been compliance with the disclosure requirements.

The County Code provided that an employee, at the time a financial statement was filed, could request that the Board withhold information from public disclosure on the ground that such disclosure would constitute an unwarranted invasion of privacy or a risk to an individual's safety or security.* Further, when the Board produces a financial statement for public inspection, it was required to notify the employee of the production and of the name of the person to whom it was provided.  

A newspaper published in Suffolk County submitted a request to the Board for release of the Plaintiff's financial disclosure statements. The request was denied by the Board and the newspaper did not challenge the Board's determination. Subsequently the County Legislature, citing sections of the New York Freedom of Information Law and the United States Code, adopted the Resolution directing the Board to provide the Plaintiff's financial disclosure statements for the period "2000 to the present" to the Ways and Means Committee of the County Legislature based the Board's denial of the newspaper's request for the petitioner's financial disclosure statements.**

Ultimately Supreme Court stayed the public release of the Plaintiff's financial disclosure statements and required that the statements be submitted to the court, in camera. The County Legislature submitted "a memorandum of law, an amended memorandum of law, and an affirmation of counsel to the County Legislature"  asserting that "members of the County Legislature have stated that the Board's determination was inconsistent with the intent and understanding of the [County] Legislature in enacting the financial disclosure statute."*** 

The Supreme Court reviewed the submitted financial disclosure statements and "redacted confidential information to protect the Plaintiff and his family." The court also directed the Board to produce redacted copies of the financial disclosure statements to the Ways and Means Committee of the County Legislature. The Board complied with the court's directive and the Plaintiff appealed the court's ruling to the Appellate Division.

Citing Marbury v Madison , 1 Cranch [5 US] 137, the Appellate Division explained that a legislative body may not usurp a court's power to interpret and apply the law to the particular circumstances before it and it is beyond the authority of the County Legislature to determine that the Board's decision to withhold the Plaintiff's financial disclosure statements from public inspection was incorrect and "to take it upon itself to obtain the statements and provide for their public release." In the words of the court, "the County Legislature wrongly placed itself in the position of a reviewing court", opining that this action "is particularly disturbing where the purportedly aggrieved newspaper took no steps to vindicate its rights to disclosure of the financial statements by the Ethics Board."

Noting that the County Legislature entrusted to the Board the responsibility for receiving and resolving requests for access to financial disclosure statements filed with the Board, the Appellate Division indicated that the "proper remedy for seeking review of a Board determination denying public access to a governmental record is to seek judicial review, not for the County Legislature to arrogate to itself a judicial function reserved for the courts and the courts alone."

The Appellate Division also disagreed with Supreme Court's determination to redact "confidential information to protect the [Plaintiff] and his family" not withstanding its holding that Plaintiff's financial disclosure statements were subject to public disclosure.  The court observed that while the Board is required to redact information pertaining to categories of value from all financial disclosure statements made available for public inspection, Supreme Court cited no authority for its decision to make further redactions.

The County Legislature also contended that the resolution could be sustained as a valid exercise of its oversight authority. However, said the Appellate Division, the record before it did not reflect that either the County Legislature or its Ways and Means Committee was conducting any oversight of the Board. Rather, noted the court, "it is undisputed on the record" before it that the resolution was adopted "for the purpose of circumventing the Ethics Board's determination to deny public release of the petitioner's financial disclosure statements."

The Appellate Division thought it significant that that the County Legislature determined, without examining the Board's determination, that the Board was wrong and took it upon itself to reverse this specific determination through the enactment of the resolution. Neither federal, state, nor county law countenance such a procedure. Thus, ruled the court, Plaintiff's petition must be granted, and the Resolution adopted by the County Legislature annulled.

* Even if no request to withhold information from public inspection is made by an employee, the County Code provides that categories of value are confidential and that such information is to be redacted by the Board before a financial disclosure statement is made available for public inspection.

** The Resolution also stated that the County Code "says that financial disclosure statements are available for public inspection and there appear[ ] to be no exceptions in the law that justify withholding a financial disclosure statement from public inspection" and that "in enacting the financial disclosure law, it was the intent of this Legislature that financial disclosure statements be available to the public."

*** The Board, although named as a respondent, did not appear before the court.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2019/2019_05779.htm