Vicariously liability for torts committed by an employee acting within the scope of the employment may require determining the employing entity

Vicariously liability for torts committed by an employee acting within the scope of the employment may require determining the employing entity

Gadson v City of New York, 2017 NY Slip Op 08657, Appellate Division, Second Department

In an action to recover damages for negligence, negligent hiring and negligent retention, intentional infliction of emotional distress, prima facie tort, and slander the defendants, City of New York and Department of Education of the City of New York [DOE], moved for summary judgment dismissing the complaint. Insofar as relevant to this appeal, the Supreme Court denied the motion and DOE appealed.

The Appellate Division first addressed the claims alleging negligence and negligent hiring and negligent retention. DOE contended that the individual, a janitor, who allegedly insulted the plaintiff's daughter was not an employee of the DOE, but rather, an employee of a nonparty independent contractor identified only as "Temco" and thus DOE could not be held liable under the doctrine of respondeat superior.

The Appellate Division, citing Judith M. v Sisters of Charity Hosp., 93 NY2d 932, said the doctrine hold an employer "vicariously liable for torts committed by an employee acting within the scope of the employment."

In contrast, the general rule is that an employer who hires an independent contractor is not liable for the independent contractor's negligent acts [see Rosenberg v Equitable Life Ass. Soc. of U.S., 79 NY2d 663].

The court noted that "despite some evidence that Temco had been providing services to the subject middle school for more than 11 years," DOE did not submit any signed contract with Temco or offer any other evidentiary proof in admissible form establishing that such a contract exists. Further, said the court, DOE "failed to submit any evidentiary proof in admissible form establishing that the janitor in question was an employee of Temco at the time of the incident."

As DOE failed to establish, prima facie, that the janitor in question was the employee of an independent contractor retained to provide janitorial services to the subject middle school, the Appellate Division ruled that Supreme Court properly denied its motion for summary judgment dismissing the causes of action to recover damages for negligence and negligent hiring and negligent retention.

Addressing Supreme Court denial of DOE's motion for summary judgment dismissing the causes of action to recover damages for intentional infliction of emotional distress, prima facie tort, and slander, the Appellate Division ruled that Supreme Court should have granted those motions. The court explained that to maintain and action to recover damages for intentional infliction of emotional distress, DOE established, prima facie, as a matter of law, that the isolated incident of name calling by the janitor, while unquestionably objectionable, did not rise to the level of extreme and outrageous conduct required to sustain such a cause of action."

Turning to the claims of the plaintiff with respect to recovering damages for slander, the Appellate Division established, prima facie, as a matter of law, that the janitor's statements were nonactionable expressions of opinion, and not facts, about the plaintiff's daughter. Further, said the court, DOE established, prima facie, that the plaintiff did not incur special damages, a necessary element of the prima facie tort cause of action .

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_08657.htm

Continuation of health insurance benefits upon retirement

Continuation of health insurance benefits upon retirement
Adamo v City of Albany, 2017 NY Slip Op 08583, Appellate Division, Third Department

Plaintiffs [Adamo] are former police officers and the spouses of former police officers who retired from their employment with defendant at various times who allege the City of Albany [City] breached the collective bargaining agreements [CBAs] that were in existence at the time of the police officers' retirements by refusing to reimburse plaintiffs for the cost of their Medicare Part B premiums.

Significantly, prior to 1985, City participated in the New York State Employee Health Insurance Plan [NYSHIP], which provided health insurance coverage for both active and retired police officers, as well as their spouses and which provided that once a retiree reached the age of 65 and enrolled in the Federal Medicare program, NYSHIP would provide secondary health insurance coverage and defendant would reimburse the retiree for his or her cost of Medicare Part B premiums.

In 1985 the City became self-insured for health insurance purposes and discontinued its participation in NYSHIP. At that point, the unions representing the active police officers negotiated new health insurance coverage and included a "health care provision" [HCP] in each subsequent CBA providing that "[a]ll employees in the bargaining unit shall be eligible for hospitalization and medical insurance for themselves and all of their eligible dependents pursuant to [certain] plan options . . . which provide benefits at the same or higher level as were provided under [NYSHIP]."

Pursuant to the HCP the City continued to reimburse retirees and their spouses for the cost of Medicare Part B premiums for the next 25 years. Effective January 1, 2010 the City said that it would not make such reimbursement payments to individuals "not yet enrolled in Medicare Part B."Adamo commence an action for breach of contract. 

However, Supreme Court, finding that the language of the HCP in the CBAs "unambiguously did not apply to retirees," dismissed the action and Adamo appealed. The Appellate Division held that Adamo's reliance on the language of the HCP was misplaced. and the City's practice of reimbursements from 1985 to 2009, maintain that they stated a cause of action for breach of contract.*

Citing Agor v Board of Educ., Northeastern Clinton Cent. Sch. Dist., 115 AD3d 1047, the court explained that "In determining the obligations of parties to a contract, the threshold determination as to whether an ambiguity exists is a question of law to be resolved by the court."** As relevant with respect to the CBAs here, "[o]nly when a contract is ambiguous can the interpretation placed upon it by the parties, as shown by their conduct, be considered in determining their intent, and even then, the parties' practices are 'merely an interpretive tool and cannot be used to create a contractual right independent of some express source in the underlying agreement.'"

The Appellate Division found that the HCP:

[1] Unambiguously failed to grant retirees the right to reimbursement for the cost of Medicare Part B premiums" by limiting its provisions to "employees in the bargaining unit";

[2] Made no reference to retirees or to health care benefits to be paid in retirement; and

 [3] Retirees are no longer part of the bargaining unit upon their retirement and, therefore, "employees in the bargaining unit" cannot be read to encompass retirees.

The bottom line: Although NYSHIP obligated City to reimburse retirees for the cost of Medicare Part B premiums and the HCP provided for the "same or higher level" of benefits, the Appellate Division concluded that the plain language of the HCP is susceptible to only one reasonable interpretation — namely, that it does not provide for any reimbursement to retirees for the cost of Medicare Part B premiums" and thus the City's past practice in this regard may not be considered.

* The Appellate Division noted that "Recently, in a proceeding commenced by active employees of defendant to annul a determination of the Public Employee Relations Board, this Court found that defendant's actions in providing reimbursements to retirees for 25 years constituted a past practice that could not be unilaterally discontinued pursuant to the Taylor Law (seeMatter of Albany Police Officers Union, Local 2841, Law Enforcement Officers Union Dist. Council 82, AFSCME, AFL-CIO v New York Pub. Empl. Relations Bd., 149 AD3d 1236" and then pointed out that "a different standard applies when considering past practices in the Taylor Law context," citing Matter of Aeneas McDonald Police Benevolent Assn. v City of Geneva, 92 NY2d at 332-333) and, thus, its holding in that case has no bearing on whether Adamo stated a cause of action for breach of contract in this action.

** In the words of the Appellate Division, an "[a]mbiguity exists if the language used lacks a definite and precise meaning, and there is a reasonable basis for a difference of opinion."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_08583.htm

Application seeking the removal of an employee of a School District

Application seeking the removal of an employee of a School District

Decisions of the Commissioner of Education, Decision No. 17,274

A resident and taxpayer of the school district petitioned the Commissioner of Education to remove the school district's physical education director and/or athletic director pursuant to §135.4 of the Commissioner’s regulations. 

The Commissioner denied the taxpayer's application, explaining that the Commissioner lacks the authority to grant the relief requested as the individual targeted for removal is an employee, not an officer subject to removal under Education Law §306. 

In the words of the Commissioner: "I lack jurisdiction to do so.  Education Law §306 authorizes the Commissioner to remove school officers under appropriate circumstances.  For purposes of §306, "school officers" include trustees, members of boards of education, clerks, collectors, treasurers, district superintendents, or "other school officer[s]."  An athletic director, however, is a school district employee, not a school officer, and is thus not subject to removal under Education Law §306."

Addressing a number of fatal procedural defects, the Commissioner noted that even if the targeted individual were a school officer subject to her jurisdiction under Education Law §306 the defective notice of petition submitted by the taxpayer would warrant denial of the application. 

The Commissioner further explained that the notice accompanying a removal application must specifically advise a school officer that an application is being made for his or her removal from office. In this case, the petitioner failed to give such notice and, instead, used the notice prescribed under 8 NCYRR §275.11(a) for appeals brought pursuant to Education Law §310. 

Further, said the Commissioner, "A notice of petition which fails to contain the language required by the Commissioner’s regulation is fatally defective and does not secure jurisdiction over the intended respondent. It is the notice of petition that alerts a party to the fact that he or she is the subject of removal proceedings, and the failure to comply with 8 NYCRR §277.1(b) necessarily results in a jurisdictional failure and requires dismissal."

The decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume57/d17274

Failing to file a timely cause of action bars applying court ordered salary adjustments retroactively

Failing to file a timely cause of action bars applying court ordered salary adjustments retroactively

Quirk v Lippman, 2017 NY Slip Op 08732, Appellate Division, First Department 

The genesis of this action was the Court of Appeals order in O'Neill v Pfau in 2011.*

In O'Neill a group of Suffolk County court officers challenged an administrative order issued in January 2004 that reclassified various court officers' employment titles, affecting their compensation, and an administrative order issued December 22, 2004, that made an upward salary adjustment to those titles, retroactive to January 2004.

The petitioners argued that the effect of applying the December 2004 order retroactively would be to deprive them of a year of continuous service credit to which they otherwise would be entitled.

On April 6, 2005, the court officers received pay checks reflecting the salary adjustments ordered in December 2004, without continuous service credit.

In this decision the Appellate Division considered the issue of demands for retroactive salary adjustments and "prospective relief.

NYSCOA member on whose behalf this action was initiated also had received their first "retroactive" paycheck 2004. They initiated this Article 78 action in January 2015, at which time the four-month statute of limitations had run "long before they commenced this proceeding."

Addressing the merits of the claim, the Appellate Division said "A cause of action challenging an administrative body's payment of salary or pay adjustments accrues when the individual  receives a check or salary payment reflecting the relevant administrative order.

The Appellate Division held that NYSCOA's time-barred claims may not be revived by recourse to equal protection principles and "no toll that exists 'solely to enable aggrieved parties to sit on their existing rights pending the outcome of an early challenge brought by others.'"

Further, said the court, as NYSCOA in this action brought this proceeding nearly 10 years after the four-month statute of limitations had begun to run, it had no more timely cause of action for "prospective" relief than it had for the retroactive pay adjustment NYSCOA sought.

In the words of the court: "Indeed, there is no legal basis for a distinction between "prospective" and "retroactive" relief here. In failing to challenge the administrative order in a timely fashion, NYSCOA  petitioners waived any right to the benefit of legal review of the December [2004} order, whatever its implications for the future."

*  O'Neill v Pfau (31 Misc 3d 184 [Sup Ct, Suffolk County 2011], affd as modified 101 AD3d 731 [2d Dept 2012], affd 23 NY3d 993.

The decision is posted on the Internet at:           

http://www.nycourts.gov/reporter/3dseries/2017/2017_08732.htm

Disclosure of a police officer's disciplinary files are protected by Civil Rights Law §50-a

Disclosure of a police officer's disciplinary files are protected by Civil Rights Law §50-a

Doe v New York City Police Dept., 2017 NY Slip Op 08734, Appellate Division, First Department

"John Doe," a former New York City Police Officer, sued the New York City Police Department seeking to recover damages arising from alleged harassment on the job due to his sexual orientation. Supreme Court rejected Doe's demand for a further deposition of one of his coworkers, a police officer, and the disclosure of the disciplinary files of that officer and another employee of the police department.

Supreme Court denied Doe's requests.

Considering Doe's appeal, the Appellate Division sustained the Supreme Court's decision, explaining that a "police officer's disciplinary files are protected by Civil Rights Law §50-a ... and [Doe] failed to provide a clear showing of facts sufficient to warrant even an in camera review of those records.

§50-a, in pertinent part, provides that " All personnel records used to evaluate performance toward continued employment or promotion, under the control of any police agency or department of the state or any political subdivision thereof including authorities or agencies maintaining police forces ... shall be considered confidential and not subject to inspection or review without the express written consent of such police officer, firefighter, firefighter/paramedic, correction officer or peace officer within the department of corrections and community supervision or probation department except as may be mandated by lawful court order.

With respect to obtaining a court order, §50-a further provides that "Prior to issuing such court order the judge must review all such requests and give interested parties the opportunity to be heard. No such order shall issue without a clear showing of facts sufficient to warrant the judge to request records for review [and] after such hearing, the judge concludes there is a sufficient basis he [or she] shall sign an order requiring that the personnel records in question be sealed and sent directly to him [or her]" for review and to make a determination as to whether the records are relevant and material in the action before him. Upon such a finding the court shall make those parts of the record found to be relevant and material available to the persons so requesting."

Further, the Appellate Division noted that "Discovery of the disciplinary file of the other police department employee was not warranted, as she was not similarly situated with [Doe]  and thus is not comparable for the purpose of showing discrimination.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2017/2017_08734.htm

New York State Comptroller Thomas P. DiNapoli issued the following audits and examinations during the week ending December 15, 2017

New York State Comptroller Thomas P. DiNapoli issued the following audits and examinations during the week ending December 15, 2017

Click on text highlighted in color to access the full report

Department of Environmental Conservation (DEC): Collection and Use of Oil Spill Funds (Follow-Up) (2017-F-13)
An initial audit report issued in August 2015 determined that there were weaknesses in DEC’s oversight of Major Oil Storage Facilities (MOSFs) reporting and facility registration, as well as a lack of facility data analysis to identify and correct discrepancies. In a follow-up, auditors found DEC officials have made significant progress in correcting the problems identified in the initial report. The initial report’s four recommendations were implemented.

Department of Health: Medicaid Claims Processing Activity October 1, 2016 Through March 31, 2017 (2016-S-66)
Auditors identified approximately $12.4 million in improper Medicaid payments, including $4.58 million in overpayments for long-stay inpatient claims that were billed at higher levels of care than what was allowed; $2.9 million in overpayments for Comprehensive Psychiatric Emergency Program claims that were billed in excess of permitted limits; and $1.4 million in overpayments for claims that were billed with incorrect information pertaining to other health insurance coverage that recipients had. By the end of the audit fieldwork, about $6.3 million of the overpayments had been recovered.

Department of Health (DOH): Appropriateness of Medicaid Eligibility Determined by the New York State of Health System (NYSOH) (Follow-Up) (2017-F-4)
An initial audit report released in October 2015 found flaws in NYSOH’s eligibility process that resulted in overpayments of about $3.4 million due to enrollments of deceased individuals and continued coverage for individuals who died after enrollment; multiple Client Identification Numbers (CINs) issued to individual recipients; and unreasonably high numbers of CINs issued for expected multiple births per pregnancy. In a follow-up, auditors found DOH made certain improvements to NYSOH and most of the overpayments caused by the enrollment of deceased individuals were recouped. However, further actions are still needed.

Office of Information Technology Services (ITS): Disaster Recovery Planning (2016-S-97)
Auditors found ITS has made some efforts toward disaster recovery planning; however, there is not a complete, functional, and tested disaster recovery plan that covers all aspects of its operations, including the College of Nanoscale Science and Engineering (CSNE) data center and the centralized IT services it provides to the 46 executive agencies. ITS is working on completing a disaster recovery plan for the CNSE data center and anticipates it will be done in late 2018.

Metropolitan Transportation Authority: Long Island Rail Road - Utilization of the Arch Street Yard and Shop Facility (2016-S-78)
Auditors found the facility was never used as intended for the acceptance and inspection of certain train cars. Moreover, except for occasional use of the wheel truing equipment to round off flat spots on rail car wheels, the facility was also not used for periodic inspections or repairs. Since its construction in December 2004, the facility has undergone periods when it was vacant (for over 3.5 years), leased to a vendor to make warranty repairs, and licensed twice; once as a parking lot to accommodate a tenant displaced from an MTA project, and once to a contractor to perform modifications on Metro-North Railroad rail cars. The LIRR incurred costs of $2.43 million to maintain and secure the facility from January 1, 2013 to June 30, 2016.

New York City Department of Housing Preservation and Development: Vacancies at the Clinton Towers Mitchell-Lama Housing Development (2017-N-1)
Vacant apartments at Clinton Towers were often not rented in a timely manner. Auditors found that for the period January 2012 through March 2017, an average of 13 apartments each month had been vacant for over 60 days, resulting in an estimated $740,000 in lost rental revenue. On March 31, 2017, 15 apartments at Clinton Towers had been vacant for more than 60 days, even though there were over 9,000 applicants on the external waiting lists, resulting in approximately $78,000 in lost rental revenue. Eleven of these apartments were vacant for more than six months, including three that had been vacant for more than a year.

State Education Department (SED): The New Interdisciplinary School (NIS), Compliance with the Reimbursable Cost Manual (2017-S-20)
NIS is a not-for-profit special education provider located in Suffolk County providing preschool special education services to children with disabilities who are between three and five years of age. For the two fiscal years ended June 30, 2014 and 2015, auditors identified $119,752 in ineligible costs that NIS reported for state reimbursement. The ineligible costs included: $83,192 in personal service costs and $36,560 in other than personal service costs.

State To Save Millions After Audit Uncovers Unnecessary Medicaid Transportation Costs

New York state’s Medicaid program is expected to save $7.6 million over the next five years as the result of actions taken by the state Department of Health (DOH) after an audit found it had incorrectly paid contractors for transportation management services it shouldn’t have, according to a report released by State Comptroller Thomas P. DiNapoli.

“Thanks to the work of my auditors, the state has tightened oversight of this important service and these changes will save millions of dollars,” DiNapoli said. “The state Department of Health moved quickly to correct these problems, and my office will continue to monitor for overpayments and abuse in the Medicaid system.”  

The Medicaid program provides transportation to medical services for individuals who are unable to obtain their own transportation. DOH contracted with two companies to manage the non-emergency transportation program statewide: LogistiCare Solutions LLC and Medical Answering Services LLC. These companies were reimbursed nearly $180 million over the audit period, January 1, 2013 to December 31, 2016.

DiNapoli’s auditors found that DOH overpaid these contractors more than $6.2 million during the audit period for transportation management services for individuals who were not eligible for these services. In response to the audit, DOH made changes, which are expected to save taxpayers another $7.6 million over the coming years.

Auditors also identified a provider of taxi services that overbilled DOH for tolls. The provider told auditors it charged for tolls based on the cash toll rate instead of the discounted amount it actually paid through its E-ZPass account. During the audit period, the provider billed Medicaid a total of $169,893 for tolls. In response to the work of auditors, the provider informed the Office of the Medicaid Inspector General (OMIG) of the overbilling. At the end of the audit fieldwork, the amount of the overpayment had not yet been determined by the OMIG.

DiNapoli’s auditors also identified another provider of taxi services that did not have supporting documentation for claims totaling about $2.4 million, and four advanced life support first responder (ALSFR) providers that were inappropriately enrolled in Medicaid, resulting in $162,401 in inappropriate payments.

DiNapoli recommended DOH:

● Recover the $6.2 million in contract overpayments to the transportation managers for the period January 2013 to December 2016 and ensure that Medicaid coverage groups are excluded from the monthly recipient counts that are used to pay transportation managers;

● Review the Medicaid payments made to the two taxi providers and recover any improper payments as warranted; and

● Review the Medicaid payments made to the four ALSFR providers and recover overpayments as warranted. Take the necessary corrective steps regarding the four ALSFR providers’ future participation in the Medicaid program, and take steps to ensure that ALSFR companies are not enrolled as Medicaid providers.

DOH’s response is included in the audit.

Read the report, or go to: http://www.osc.state.ny.us/audits/allaudits/093018/16s67.pdf

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