An adminsitrative tribunal may not rely on evidence not in the record in arriving at its decision

An adminsitrative tribunal may not rely on evidence not in the record in arriving at its decision

Kaplan v New York City Tr. Auth., 2018 NY Slip Op 04068, Appellate Division, Third Department

It is "black letter law" that all administrative agencies must render decisions based on the evidence contained in the record pertaining to the particular case before it.

In this case the Workers' Compensation Board [Board] ruled that the employee's death did not arise out of and in the course of his employment* and denied his survivor's [Claimant] application for workers' compensation death benefits.

The Appellate Division, noting that as required of every administrative agency, the Board must render decisions based on the evidence contained in the record pertaining to the particular case before it said that here the Board relied on medical records "apparently contained in the case file for a separate claim" filed by decedent based on a 2014 fall at work and that one page is the only medical record from 2014 that was included in the current record.

The Board, said the court, relied heavily upon medical records contained in the case file for the 2014 claim although the employer did not request that the Board rely on those 2014 records. Further was the procedure for introducing additional evidence into the administrative appeal that was not before the Workers' Compensation Law Judge was not complied with and the Board's rule provides that, if that procedure is not followed, the Board "will not" consider such new evidence.

The Appellate Division said that Claimant was prejudiced because she was not on notice  until she received the Board decision that the Board would rely on documents from another case file.

The employer contended that 2014 medical reports cannot be objectionable because they accurately reflect the treatment rendered. The court said it could not verify that claim without reviewing those reports.

The Appellate Division also rejected the employer's argument "that no response to the medical records would change the strength of either side's argument"  as constituting "mere speculation" and had those records been properly introduced, either party "may have chosen to submit additional medical records reflecting on decedent's medical treatment from November 2014 until his death in July 2015 had the parties been on notice that this period of treatment would be at issue."

Finally, the court said it could not assume that the Board would have reached the same decision had it not considered the medical records from the earlier case file in view of the fact that "[t]he Board referred to more than one of those medical records, indicated that it considered at least 27 pages and quoted at length from one 2014 document that it found to be 'most telling with respect to the cause of the decedent's death,'" noting that "[i]n one specific finding, the Board stated that any presumption of compensability was rebutted by Brief's medical opinion and the medical evidence in the case file associated with the other claim."

Finding that the Board improperly relied upon documents outside the record, which were not before Court for its review, the Appellate Division reversed the Supreme Court's ruling dismissing Claimant's appeal and remitted the matter to the Board "for further proceedings not inconsistent with this Court's decision."

* To be compensable under the Workers' Compensation Law, an accidental injury must arise both out of and in the course of employment. In situations where there an unwitnessed or unexplained death occurs during the course of employment is involved, the claimant is relieved of the obligation to submit prima facie medical evidence of a causal relationship but that presumption "may be rebutted if substantial evidence demonstrates that the death was not work related."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04068.htm

Adjudicating the impact of a statute or a regulation that impairs obligations of the parties set out in collective bargaining agreements

Adjudicating the impact of a statute or a regulation that impairs obligations of the parties set out in collective bargaining agreements

Buffalo Teachers Fedn., Inc. v Elia, 2018 NY Slip Op 04061, Appellate Division, Third Department

This appeal sought court review of three determinations of the Commissioner of Education resolving disputes between the Buffalo Federation of Teachers [Federation] and the Buffalo City School District [District] concerning the negotiation of a receivership agreement pursuant to the Education Transformation Act of 2015* which provided for the "[t]akeover and restructuring of failing schools."

The Act restricts the subject matter of the receivership agreement to "the length of the school day; the length of the school year; professional development for teachers and administrators; class size; and changes to the programs, assignments, and teaching conditions in the school receivership." The Act further provides that if the parties are unable to reach an agreement with regard to "unresolved issues" must ultimately be submitted to the Commissioner for resolution, whereupon "the Commissioner has five days to resolve the issues in accord with standard collective bargaining principles."

One of the question presented in this appeal was whether the Act was "reasonable and necessary to further the significant and legitimate public interest in 'maximiz[ing] the rapid achievement of students' at schools deemed to be persistently struggling and struggling" with respect to the impairment of provisions set out in a collective bargaining agreement between the parties.

Citing Energy Reserves Group, Inc. v Kansas Power and Light Co., 459 US 400, the Appellate Division observed that "[g]enerally, where a statute or regulation impairs a private contract, courts will defer to a legislature's rationale with regard to its necessity."

In contrast, said the court, less deference is warranted [to the legislature's rationale] where the statute or regulation "is self-serving and impairs the obligations of [the state's] own contracts" because "a [s]tate is not completely free to consider impairing the obligations of its own contracts on a par with other policy alternatives." Further, the Appellate Division continued, "less deference [to the legislature's rationale] may be warranted even where, as here, the state is not a party to an impaired public contract."

The tests applied in determining if an impairment is reasonable and necessary under a "less deference scrutiny" analysis, must be shown that the state did not:

"(1) consider impairing the contracts on par with other policy alternatives; or

"(2) impose a drastic impairment when an evident and more moderate course would serve its purpose equally well; nor

"(3) act unreasonably in light of the surrounding circumstances."

Assuming, without deciding, that the "less deferential standard" applied in this instance, the Appellate Division found that applying the relevant provision of the Education Law was  reasonable and necessary both on its face and as applied, explaining that "the receivership agreement was necessary in order to implement available methods to address the immediate issues that were facing the struggling or persistent struggling schools."

The court observed that the statute provides that the Superintendent of Schools must act in accordance with the existing collective bargaining agreement and, "where, as here, a receivership agreement is requested, the statute limits the scope of the agreement — and impairment." Further, "no modification or impairment can be unilaterally imposed but instead must be negotiated."

The Appellate Division concluded that "As applied, although an agreement was not reached with regard to all issues, the modifications imposed were applicable to the affected schools only for the time limited by the statute" which applied prospectively and limited the scope, application and duration of any modifications to existing agreements, while prohibiting any adverse financial impact. This, said the court, "was reasonably designed and necessary to further the goal of helping students to succeed."

Noting that the Federation contended that there were "means and methods that would be much more effective," the Appellate Division decided that "the relative wisdom of the statute is not for [it] to consider" and  remitted the matter to State Education Department for "further proceedings not inconsistent with this Court's decision."

* Laws of 2015, Chapter 56, Part EE, Subpart H, §§1 and 2.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04061.htm

A police officer's accident disability retirement benefits are to be offset against the injured retiree's jury award for future lost earnings and pension

A police officer's accident disability retirement benefits are to be offset against the injured retiree's jury award for future lost earnings and pension

Andino v Mills, 2018 NY Slip Op 04273, Court of Appeals

Does a retired New York City police officer's accident disability retirement (ADR) benefits are a collateral source that a court must offset against the injured retiree's jury award for future lost earnings and pension?

The Court of Appeals held that a New York City retired police officer's accident disability retirement (ADR) benefits does so operate by [1] replacing earnings during the period when the officer could have been employed absent the disabling injury and then [2] serving as pension allotments. Accordingly, a court must offset the retiree's projected ADR benefits against the jury award for both categories of economic loss.*

Niurka Andino [Plaintiff] is a retired police officer who was injured on duty while riding in a police car that collided with a vehicle owned by the New York City Transit Authority (NYCTA) and operated by NYCTA employee Ronald Mills [Defendants].

Defendants moved to offset the jury award pursuant to CPLR §4545, which permits a court to find that certain awarded damages were or will, with reasonable certainty, be replaced or indemnified from a collateral source. Defendants contended that "when a police officer retires due to an on-the-job injury that leaves the officer disabled, the ADR benefits allotted to that officer for those years when the officer could have been working, if not for the disability, operate as lost earnings. Once the retired officer reaches the age for regular retirement from service, absent the retirement-inducing injury, ADR benefits serve as a pension."

Andino argued that [1] "there is no direct correspondence between her ADR benefits and the categories of economic loss awarded by the jury" and [2] "that ADR displaces Ordinary Disability Retirement (ODR), and the higher amount of ADR benefits as compared with ODR allotments is paid as a reward for services previously rendered." As the Court of Appeals characterized Andino's argument, "... the premium in ADR benefits as compared to ODR benefits is neither "earnings" nor "pension" but paid in gratitude for past services".

The Court of Appeals explained that ADR benefits, and the text and legislative intent of CPLR §4545, as interpreted by the court in Oden v Chemung County, 87 NY2d 81,** provide the basis for concluding that "ADR benefits operate sequentially as payment for future lost earnings and pension benefits." Accordingly, said the court, on a motion pursuant to CPLR §4545, "a court must apply ADR benefits, dollar-for-dollar, to offset the jury award for future lost earnings during the period they represent lost earnings, and future lost pension during the period they represent lost pension."

The court also rejected Andino's alternative argument that "ADR benefits are a 'reward' for the retiree's service which may not be offset against a jury award" as unpersuasive, explaining that "there is no support in the Administrative Code or CPLR §4545 or any available legislative history to treat ADR benefits as a category on its own, exempt from mandatory offset." In any event, said the court, "even if the Legislature sought to reward service members like Andino, who suffer an injury in the line of duty, that would not change the classification of ADR benefits as a replacement for lost earnings and pension allowances" as there is no legal justification for treating a portion of ADR benefits as a reward based on the 25% differential between ODR and ADR benefits. In the words of the Court of Appeals, "CPLR 4545 anticipates a dollar-for-dollar  offset" and that offset "is based on the category of reimbursement, not on a stratification of the collateral source total amount."

The case was remitted Supreme Court for further proceedings "in accordance with the opinion herein and, as so modified, affirmed," Judges Wilson dissenting in an opinion in which Judge Fahey concured.

* By stipulation, the parties agreed to set the period for future lost earnings at 19.24 years and future lost pension at 17.7 years.

** The specific facts of Oden, said the court, explain why that decision provides a different disposition than is called for Andino's case. In Oden, the plaintiff's private sector retirement pension benefits could not offset the jury's award for his future lost earnings because the pension allotments did "not necessarily correspond to any future earning capacity plaintiff might have had," because Oden "would have been free to earn income from his labor in other capacities without loss of his disability retirement pension benefits."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04273.htm

New York State Comptroller Thomas P. DiNapoli announced the following audits and examinations have been issued

New York State Comptroller Thomas P. DiNapoli announced the following audits and examinations have been issued

Source: Office of the State Comptroller, June 19, 2018

Click on text highlighted in color to access the full report.

State Education Department (SED): Infant and Child Learning Center (ICLC) - The Research Foundation for the State University of New York: Compliance with the Reimbursable Cost Manual (2017-S-22)

For the three fiscal years ended June 30, 2015, auditors identified $1,727,960 in reported costs that did not comply with SED requirements for reimbursement, including $1,519,114 in improperly calculated parent agency administrative allocation costs.

New York State Health Insurance Program (NYSHIP): Preventing Inappropriate and Excessive Costs in the New York State Health Insurance Program (2016-D-1)

Based on the findings of 35 reports, auditors determined significant cost savings to NYSHIP would occur if more out-of-network providers who improperly waive members’ out-of-pocket costs ended this practice and joined the Empire Plan network. Additionally, out-of-network providers who join the Empire Plan benefit plan members by expanding the number of in-network providers from which members can choose. Auditors recommended that action be taken to recover overpayments and prevent out-of-network providers from improperly waiving members’ out-of-pocket costs.

Department of Health (DOH): Examination of Official Station Designation (2015-BSE1-04)
DOH’s designation of the official station for an employee in calendar years 2013 and 2014 was not made in accordance with the state’s travel rules and regulations. As a result of an improper official station designation, DOH paid $16,089.56 and $22,033.71 in travel expenses during calendar years 2013 and 2014 for the employee to commute between his residence and an alternate work location.

New York City Department of Social Services (DSS): Oversight of Security Expenses in Single Adult and Adult Family Homeless Shelters (2016-N-6)

The city’s Department of Homeless Services, working under DSS, did not have adequate written standard operating procedures to guide staff on how to perform and document the required oversight reviews and inventory record-keeping practices at shelter locations. DHS did not consistently comply with its own policies to perform periodic reviews of shelter providers’ security expenditures. Auditors found significant compliance-related issues that accounted for $2.2 million in insufficiently documented and/or questionable security expenses. DHS also did not ensure that providers complied with competitive bidding requirements and maintained adequate supporting documentation.

Find out how your government money is spent at Open Book New York. Track municipal spending, the state's 145,000 contracts, billions in state payments and public authority data. 

 

Determining if a police officer acted within the scope of his or her employment for the purposed of the employer providing for defense and indemnification

Determining if a police officer acted within the scope of his or her employment for the purposed of the employer providing for defense and indemnification

Lemma v Nassau County Police Officer Indem. Bd., 2018 NY Slip Op 04382, Court of Appeals

General Municipal Law § 50-1 provides for defense and indemnification of Nassau County police officers, requiring indemnification for civil "damages, including punitive or exemplary damages, arising out of a negligent act or other tort of such police officer committed while in the proper discharge of [the officer's] duties and within the scope of [the officer's] employment."

In this CPLR Article 78 proceeding, the issue is whether the Nassau County Police Officer Indemnification Board's determination revoking a prior defense and indemnification determination in favor of a Nassau County police officer, [Petitioner] was irrational. To answer that question, the Appellate Division said that it must determine the meaning of the phrase "proper discharge of . . . duties" in the context of this statute. Its conclusion: the Board's finding that Petitioner's conduct was not "proper" within the meaning of the statute was rational.

The genesis of this action was an arrest of one Raheem Crews [Crews] for a crime. A few days later, on June 1, 2005, Petitioner questioned another suspect, who admitted his own involvement but said that Crews was in jail at the time of the robbery. That same day, Petitioner confirmed via a police database search that Crews was incarcerated on the date of the robbery. Despite knowledge that Crews could not have been one of the perpetrators, Petitioner told no one.

It was not until September, after Crews was arraigned on an indictment listing the date of the robbery as March 26, 2005, that defense counsel demonstrated that Crews had been incarcerated on that date, securing his immediate release and dismissal of the charges.

Crews commenced an action in federal court pursuant to 42 USC §1983 against Petitioner, among others and Nassau County, unaware at that time that Petitioner had known and failed to disclose that Crews was in jail on the date of the crime, offered to represent and indemnify Petitioner pursuant to General Municipal Law §50-1, based on the Board's initial determination that any actions taken by Petitioner that might give rise to liability were within the scope of Petitioner's employment and a proper discharge of his duties. When some years later, as the result of Petitioner being deposed in the Crews case, it was revealed for the first time that Petitioner had learned a few days after the arrest that Crews was in jail on the date of the robbery, the Board reopened its decision to indemnify Petitioner and held a hearing. Ultimately the Board voted to revoke defense and indemnification.

In affirming the Board's decision, the Appellate Division held, among other things, that "the Board rationally interpreted General Municipal Law §50-1 to limit defense and indemnification, reasoning that the word "proper" was "added . . . to exclude indemnification for intentional misconduct."

Petitioner next sought permission to appeal the Appellate Division's ruling and the Court of Appeals granted Petitioner's motion.

The Court of Appeals affirmed the Appellate Division decision, noting that "Where, as here, no administrative hearing was required, judicial review of an agency determination is limited to whether the Board's determination was irrational or arbitrary and capricious." Citing Williams v City of New York, 64 NY2d 800, the court explaining that an administrative determination of a board or agency involving employee indemnification "may be set aside only if it lacks a factual [or legal] basis, and in that sense, is arbitrary and capricious."

Noting that General Municipal Law §50-1 authorizes Nassau County to defend and indemnify police officers named as defendants in civil actions or proceedings, providing indemnification from "any judgment . . . for damages, including punitive or exemplary damages, arising out of a negligent act or other tort of such police officer committed while in the proper discharge of [the officer's] duties and within the scope of [the officer's] employment" the statute provides that "[s]uch proper discharge and scope shall be determined by a majority vote of a panel" appointed by various Nassau County officials, the Court of Appeals concluded that "[t]he legislature, thus, left the determination of whether the statutory prerequisites are met to the discretion of the Board."

Significantly, the Court of Appeals said that "[t]he decision whether to defend and indemnify a police officer is typically made by the Board at the beginning of litigation or upon discovery of facts previously unknown — long before the facts are litigated and a judgment of punitive damages is ever rendered. The Board may take a different view of the facts than is ultimately adopted by a jury in the underlying civil action against the officer."

Concluding that the Board's determination that Petitioner's conduct was not in the "proper discharge of his duties" was not arbitrary and capricious and that there was evidence supporting the Board's finding the decision notes that "despite knowledge that Crews could not have committed the robbery for which he had been arrested and charged (and for which he remained in pretrial detention for four months), [Petitioner], by his own admission, remained silent — conduct antithetical to proper police work that resulted in a man's loss of liberty."

Holding that the Board's determination was rational, the Court of Appeal held that it was entitled to deference and must be sustained."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04382.htm