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Service Requirements of Education Law 3813(1) Do Not Apply to Disputes Involving the Public Interest As Opposed to Private Rights/Criteria for Granting an Extension (Nunc Pro Tunc) to Effect Service Pursuant to CPLR 306-b Explained

The Second Department determined an action challenging the award of a contract to a bus company by a school district should not have been dismissed for failure to comply with the service requirements of the Education Law and the CPLR.  The service requirements of Education Law 3813(1) do not apply to disputes involving the public interest as opposed to private rights.  The complaint was not served in accordance with CPLR 311(a)(7) because it was served upon a security guard and not one of the persons designated in the statute.  However, the matter was sent back for a ruling whether an extension of the time for service should be granted pursuant to CPLR 306-b:

In general, the service of a timely notice of claim pursuant to Education Law § 3813(1) is a condition precedent to the commencement of an action or proceeding against a school district, and failure to comply with this requirement is a fatal defect … . However, “not all actions and special proceedings have been held to be subject to the prerequisites of subdivision 1 of section 3813. The pertinent distinction is between actions and proceedings which on the one hand seek only enforcement of private rights and duties and those on the other in which it is sought to vindicate a public interest; the provisions of subdivision 1 of section 3813 are applicable as to the former but not as to the latter” … .

Because “[t]he central purposes of New York’s competitive bidding statutes are the (1) protection of the public fisc by obtaining the best work at the lowest possible price; and (2) prevention of favoritism, improvidence, fraud and corruption in the awarding of public contracts” …, a proceeding challenging the award of a contract pursuant to the competitive bidding statutes is a matter in the public interest … . Since the petitioners here do not seek only to enforce their private rights, Education Law § 3813(1) does not apply … . …

Pursuant to CPLR 306-b, where service is not made within 120 days of the commencement of the action or proceeding, the matter is subject to dismissal, but the court may, “upon good cause shown or in the interest of justice, extend the time for service.” The Court of Appeals has made clear that these are two distinct standards and that, while “good cause” requires a showing of reasonable diligence, “the interest of justice” has a broader scope, which can encompass late service due to “mistake, confusion or oversight, so long as there is no prejudice to the defendant” … . In determining whether an extension of time is warranted in the interest of justice, a court may consider, inter alia, “diligence, or lack thereof, . . . expiration of the Statute of Limitations, the meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiff’s request for the extension of time, and prejudice to defendant” … . Matter of Baumann & Sons Buses Inc v Ossining Union Free Sch Dist, 2014 NY Slip Op 07353, 2nd Dept 10-29-14

 

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