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Lump Sum Settlement with Third Party Barred Transfer of Employer’s Liability for Future Medical Payments to the Special Fund

The Third Department, in a full-fledged opinion by Justice Stein, determined that a lump sum payment from a third party, to which the employer agreed in return for the worker’s forebearance re: future indemnity payments by the employer, barred the transfer of the employer’s liability for future medical payments to the Special Fund:

Pursuant to Workers’ Compensation Law § 25-a, liability for a claim will be transferred to the Special Fund when an application is made to reopen a closed case after a lapse of seven years from the date of the injury and three years from the date of the last payment of compensation … . The issue here distills to when the last payment of compensation was made in light of the settlement agreement between claimant and the employer. …

Pursuant to Workers’ Compensation Law § 25-a (7), where a case is “disposed of by the payment of a lump sum,” the date of the last payment of compensation is established by calculating the date to which the amount paid in the settlement would have extended had the award of indemnity benefits been made at the maximum compensation rate warranted on the date the lump-sum payment was approved … . Here, the employer entered into an agreement with claimant on December 30, 2008 that permitted claimant to retain the proceeds of the third-party action in exchange for, among other things, his forebearance of future indemnity benefits. In our view, these proceeds constituted a lump-sum payment for purposes of the statute. Contrary to the employer’s contention that the statute only applies where the employer itself makes a lump-sum payment to the claimant, we note that the plain language of the statute indicates that it applies “where the case is disposed of by the payment of a lump sum,” without reference to the source of such payment (Workers’ Compensation Law § 25-a [7]). Thus, because the settlement agreement effectively “disposed” of the employer’s obligation to pay future indemnity benefits in exchange for claimant’s retention of a lump-sum payment from the third-party action, application of the statute is appropriate to bar transfer of liability for future medical benefits to the Special Fund. Matter of Nicpon v Zelasko Constr Inc, 2014 NY Slip Op 04102, 3rd Dept 6-5-14

 

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No Need to Be Affiliated with an Authorized Rescue Entity or Volunteer Agency to Qualify for Benefits from World Trade Center Volunteer Fund

The Third Department, in a full-fledged opinion by Justice Egan, determined that the claimant, who was not affiliated with any authorized rescue entity or volunteer agency, but who participated in rescue efforts at or near the World Trade Center on September 11 and 12, 2001, was entitled to Workers’ Compensation benefits:

Workers’ Compensation Law article 8-A, which is to be afforded a liberal construction, “was enacted ‘to remove statutory obstacles to timely claims filing and notice for latent conditions resulting from hazardous exposure for those who worked in rescue, recovery or cleanup operations following the World Trade Center September 11, 2001 attack'” …, quoting Senate Mem in Support, 2006 McKinney’s Session Laws of NY, at 1915). A “volunteer” may qualify for coverage under the statute provided he or she tenders to the Board satisfactory evidence that he or she participated in the rescue, recovery, or cleanup operations at the World Trade Center site (see Workers’ Compensation Law § 161 [1]; [b]; [i]) — a geographical location defined by Workers’ Compensation Law § 161 (2) — between September 11, 2001 and September 12, 2002 and suffers from a “[q];ualifying condition,” including rhinitis and sinusitis (see Workers’ Compensation Law § 161 [3]; [a]), gastroesophageal reflux disease (see Workers’ Compensation Law § 161 [3]; [c]) and anxiety or depression (see Workers’ Compensation Law § 161 [3]; [d]). Here, the Board did not directly address the time, location and activity elements of the statute; rather, the Board denied claimant’s application for workers’ compensation benefits solely because claimant “did not serve under the direction of an authorized rescue entity or volunteer agency” and, hence, “[did]; not meet the definition of [a]; volunteer” within the meaning of Workers’ Compensation Law article 8-A.

* * * Noticeably absent from both Workers’ Compensation Law article 8-A and the commonly understood meaning of the word volunteer is any requirement that such individual “serve under the direction of an authorized rescue entity or volunteer agency.” Accordingly, the Board’s imposition of such a requirement is, to our analysis, contrary to the plain terms of the statute. Matter of Hazan v WTC Volunteer Fund, 2014 NY Slip Op 04103, 3rd Dept 6-5-14

 

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Allegations Supported the Existence of an “Implied Physician-Patient Relationship” Giving Rise to a Duty Owed to Plaintiff by the On-Call Surgeon—The On-Call Surgeon Was Notified of Plaintiff’s Facial Lacerations But Told Hospital Personnel (by Phone) His Services Were Not Required to Treat the Plaintiff—Plaintiff Alleged Suturing by a Physician’s Assistant Resulted in Excess Pain and Scarring

Plaintiff alleged that the defendant on-call plastic surgeon should have treated infant plaintiff whose facial lacerations were sutured by a physician’s assistant (resulting in excess pain and scarring). The defendant on-call plastic surgeon, after being notified of plaintiff’s condition by phone, informed hospital personnel his services were not needed to treat the plaintiff. The surgeon brought a motion to dismiss for failure to state a cause of action, and a motion for summary judgment, on the ground that he did not treat the plaintiff and, therefore, there existed no physician-patient relationship giving rise to a duty on his part.  The Second Department, after explaining the criteria for both types of motions, determined the motions were properly denied. Although the surgeon did not treat the plaintiff, a question was raised whether an “implied physician-patient relationship” existed by virtue of the surgeon’s communication with hospital personnel indicating his services were not needed for the plaintiff’s wounds:

“In considering a motion to dismiss a complaint for failure to state a cause of action pursuant to CPLR 3211(a)(7), the court must accept the facts as alleged in the complaint as true, accord the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” … . ” A court is, of course, permitted to consider evidentiary material submitted by a defendant in support of a motion to dismiss pursuant to CPLR 3211(a)(7)'” … . “If the court considers evidentiary material, the criterion then becomes whether the proponent of the pleading has a cause of action, not whether he has stated one'” … . In a case where a defendant has submitted evidentiary material in support of a motion to dismiss pursuant to CPLR 3211(a)(7), the motion must be denied ” unless it has been shown that a material fact as claimed by the pleader to be one is not a fact at all and unless it can be said that no significant dispute exists regarding it'” … .

Summary judgment, in contrast to a motion to dismiss, is designed to expedite civil cases by eliminating claims which can properly be resolved as a matter of law … . It is a drastic remedy which “should only be employed when there is no doubt as to the absence of triable issues” … . On a motion for summary judgment, the party seeking judgment as a matter of law has the burden of tendering evidentiary proof in a form admissible at trial to show the absence of triable issues of fact … . The failure to eliminate all material issues of fact results in the denial of the motion, regardless of the sufficiency of the opposing papers … .

In support of his motion, the defendant argued that no physician-patient relationship existed that gave rise to any duty, as he did not examine or treat the infant plaintiff and did not dispense any medical advice on which anyone relied. Certainly, for there to be a cause of action sounding in medical malpractice, a physician-patient relationship must exist that gives rise to a duty of care …, and the absence of such a relationship precludes the cause of action … .

The physician-patient relationship is typically created when “professional services of a physician are rendered to and accepted by another person for the purposes of medical or surgical treatment” … . However, the law also recognizes circumstances where the existence of a physician-patient relationship is implied by circumstances. “An implied physician-patient relationship can arise when a physician gives advice to a patient, even if the advice is communicated through another health care professional” … .

The Supreme Court properly denied the defendant’s motion pursuant to CPLR 3211(a)(7) to dismiss the complaint insofar as asserted against him for failure to state a cause of action or, in the alternative, for summary judgment dismissing the complaint insofar as asserted against him. The defendant, in his role as the on-call plastic surgeon for Southside Hospital, allegedly made a medical determination over the phone that the infant plaintiff’s facial laceration was not an emergency requiring his expertise as a board-certified plastic surgeon. The defendant’s determination allegedly resulted in the suturing of the wound, without sedation, by a physician’s assistant, beyond the time frame that was medically advisable and which resulted in scarring. Pizzo-Juliano v Southside Hosp., 2015 NY Slip Op 04626, 2nd Dept 6-5-3-15

 

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Alternating Custody on a Yearly Basis, Requiring the Child to Attend Two Schools, Was Not In the Child’s Best Interests

The Third Department determined that alternating physical custody between the parents on a yearly basis, requiring the child to attend two different schools, was not in the child’s best interests:

Here, based on the totality of the circumstances, we disagree with Family Court’s determination, and find that alternating physical custody on a yearly basis is not in the child’s best interests … . Although presenting differing arguments, both parents, as well as the attorney for the child, argue against this disposition on this appeal. As a result of the alternating school schedule in place previously, the child has missed activities and field trips at both schools, and this can only be expected to increase. The superintendent of the school district in Canada where the child’s school is located opined in a letter that the child’s social, emotional and academic development would best be served by attending only one school, and we agree. Despite the hardships and separation necessarily arising from the physical distance between the two parents, it is the child’s own stability that takes increasing precedence as he ages … . Matter of Nelson v Perea, 2014 NY Slip Op 04091, 3rd Dept 6-5-14

 

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Father’s Status as an Untreated Sex Offender, Together with Mother’s Willingness to Leave the Children with Father Unsupervised, Was Sufficient to Establish Neglect

The Third Department determined father’s status as an untreated sex offender, together with mother’s willingness to leave the children with father unsupervised, was sufficient to establish neglect:

Petitioner bore the burden of establishing, by a preponderance of the evidence, “first that the children’s ‘physical, mental or emotional condition [was]; impaired or [was]; in imminent danger of becoming impaired’ and, second, that such harm was directly attributable to a failure on the part of [the]; respondent ‘to exercise a minimum degree of care . . . in providing the [children]; with proper supervision or guardianship'” … . While actual harm is not required, the imminent danger of harm “must be near or impending, not merely possible” … . “[A];dditionally, there must be a link or causal connection between the basis for the neglect petition and the circumstances that allegedly produce the child’s impairment or imminent danger of impairment” … .

…[W]e agree with Family Court that the evidence submitted regarding the facts underlying the father’s convictions for abusing young children in his care is sufficient to distinguish this case from Matter of Afton C. (James C.) (17 NY3d at 11…)..

In addition, petitioner also introduced evidence that the father did not complete the sex offender treatment he had been ordered to undergo after his first conviction, that he did not participate in any sex offender treatment while in prison for his second conviction and that the individual counseling he received from a minister while in prison and upon his release did not qualify as appropriate sex offender treatment. Matter of Lillian SS, 2014 NY Slip Op 04101, 3rd Dept 6-5-14

 

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Child’s Out-of-Court Statements Alleging Sexual Touching Were Not Corroborated—the Child’s Repeating the Same Allegations to Several Persons Does Not Constitute Corroboration—Neglect and Derivative Neglect Findings Reversed

The Third Department determined that the child’s out-of-court stated alleged sexual touching (by Makenzie) were not sufficiently corroborated. The findings of neglect and derivative neglect based on the statements were reversed:

While the out-of-court statements made by a child relating to any allegations of abuse or neglect are admissible in Family Ct Act article 10 proceedings, they must be corroborated in order to “be sufficient to make a fact-finding of abuse or neglect” (Family Ct Act § 1046 [a]…). The purpose of this requirement is to establish the reliability of the hearsay statements, and Family Court has considerable discretion to determine the sufficiency of corroborative evidence … . Such a statement “may be corroborated by any evidence tending to support its reliability, and a relatively low degree of corroborative evidence is sufficient” … . Nevertheless, we conclude that petitioner failed to satisfy its burden here.

Family Court’s conclusion, based upon our decision in Matter of Brandon UU. (193 AD2d 835 [1993]), that sufficient corroboration existed because the child pointed to the area where she claimed respondent had pinched her, is misplaced. The determination in Matter of Brandon UU. (supra) was based on the child’s consistent account of sexual abuse coupled with the expert testimony that the child was being truthful (id. at 837). Here, there was no expert testimony and the child’s demonstration, without more, is part of the out-of-court statement itself and insufficient as corroboration … .

Likewise, there is no merit to petitioner’s argument that the child’s repetition of consistent accounts of the abuse to the grandmother, social worker and detective serve as sufficient corroboration. It is well settled that “repetition of an accusation by a child does not corroborate [that]; child’s prior account” … . The lack of any proof “validating the child’s account or relating any of her past or present conduct or characteristics to the alleged sexual abuse” requires reversal of the finding of neglect as to Makenzie on the ground that the out-of-court statements were not sufficiently corroborated … . Matter of Katrina CC, 2014 NY Slip Op 04094, 3rd Dept 6-5-14

 

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District Attorney’s Former Status as a Judge Hearing Cases Involving the Department of Social Services Did Not Preclude the District Attorney from Issuing Subpoenas for Department Records

The Third Department determined the district attorney’s former status as a judge in matters involving the county social services department did not require the quashing of subpoenas issued by the district attorney seeking records kept by the social services department, either under the Judiciary Law or on appearance-of-impropriety grounds:

The subpoena seeks records pertaining to business relationships between the Columbia County Department of Social Services (hereinafter DSS) and two contractors. The Commissioner first contends that, as the subpoena identifies the documents sought in part by reference to services provided to certain named children, Judiciary Law § 17 precludes the DA — who was formerly a Columbia County Judge — from issuing it. This statute prohibits a former judge from “act[ing]; as attorney or counsellor in any action, claim, matter, motion or proceeding, which has been before him [or her]; in his [or her]; official character” (Judiciary Law § 17). The Commissioner asserts that, because the named children were allegedly the subjects of Family Court proceedings pending before the DA in his former role as a judge, the subpoena violates this provision. In this context, however, there is a relevant distinction between the object of the underlying court proceedings and the individuals involved in such proceedings. Notably, although the subpoena does reference named children, it does not appear to directly relate to any court proceedings involving those children; it appears instead, although little detail is provided, to relate to social services provided to the named children by the contractors. Similarly, although DSS was a party to many court proceedings over which the DA presided during his judicial tenure, disqualification is not mandated in the absence of an evidentiary showing that the subpoena addresses any action or court proceeding that was previously before him in his judicial capacity… . Matter of Columbia County Subpoena Duces Tecum…, 2014 NY Slip Op 04104, 3rd Dept 6-5-14

 

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Where Proof of the Fair Market Value of Foreclosed Property (Offered in Support of a Motion for a Deficiency Judgment) Is Insufficient, Rather than Deny the Motion Outright, the Court Should Direct the Bank to Submit Additional Proof

The Court of Appeals, in a full-fledged opinion by Judge Pigott, determined Supreme Court properly failed to award a post-foreclosure-sale deficiency judgment to the bank because the bank’s proof of the fair market value of the foreclosed property, although uncontested, was insufficient.  However, Supreme Court should have allowed the bank to present additional proof establishing the fair market value:

RPAPL 1371 (2) directs that, when a lender makes a motion for a deficiency judgment,

“the court, whether or not the respondent appears, shall determine, upon affidavit or otherwise as it shall direct, the fair and reasonable market value of the mortgaged premises as of the date such premises were bid in at auction or such nearest earlier date as there shall have been any market value thereof and shall make an order directing the entry of a deficiency judgment” … .

This provision is a directive that a court must determine the mortgaged property’s “fair and reasonable market value” when a motion for a deficiency judgment is made. As such, when the court deems the lender’s proof insufficient in the first instance, it must give the lender an additional opportunity to submit sufficient proof, so as to enable the court to make a proper fair market value determination. * * *

It is, of course, within the court’s discretion to elucidate the type of proof it requires so it can render a proper determination as to fair market value. The court may also order a hearing if it deems one necessary. In proceedings that are governed by section 1371, the court is in the best position to determine the type of proof that will allow it to comply with the directives of that section. Lenders seeking deficiency judgments, however, must always strive to provide the court with all the necessary information in their first application.  Flushing Sav. Bank, FSB v Bitar, 2015 NY Slip Op 04678, CtApp 6-4-15

 

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Courts Do Not Defer to an Agency’s Construction of a Statute—Workers’ Compensation Board’s Determination, Based Upon the Construction of Workers’ Compensation Law 25, Reversed

In the context of a “conciliation process” pursuant to Workers’ Compensation Law 25, the Third Department explained the court’s role in reviewing the determination of an agency when statutory construction is the sole issue. Unlike the factual determinations of an agency, to which courts must defer, no such deference is afforded an agency’s construction of a statute. Reversing the Workers’ Compensation Board, the Third Department held that the statute unambiguously entitled claimant to a penalty imposed upon the employer for failure to timely make compensation payments:

Where, as here, the issue is one of pure statutory construction, no deference need be accorded to the Board’s interpretation of the statutory framework … . As to our construction of Workers’ Compensation Law § 25, “the text of a statute is the best evidence of legislative intent and, where the statutory language is clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used” … . Further, the provisions within that statute must be “construed together unless a contrary legislative intent is expressed, and courts must harmonize the related provisions in a way that renders them compatible” … .

Turning to the relevant statutory provisions, Workers’ Compensation Law § 25 has two mechanisms for penalizing employers or workers’ compensation carriers who fail to make timely payment of compensation following a decision. The first provides that, “[i]f the employer or its insurance carrier shall fail to make payments of compensation according to the terms of the award within [10] days . . ., there shall be imposed a penalty equal to [20%] of the unpaid compensation which shall be paid to the injured worker or his or her dependents” (Workers’ Compensation Law § 25 [3] [f]). The second provides that, if payment is not made within 10 days of a proposed conciliation decision becoming final, “the chair [of the Board] shall impose . . . a fine of [$500] for failure to live up to the terms of the decision upon verification that payment has not been timely made” (Workers’ Compensation Law § 25 [2-b] [h]; see 12 NYCRR 312.5 [i]).

The statutory scheme unambiguously entitles claimant to the penalty described in Workers’ Compensation Law § 25 (3) (f). Matter of Liberius v New York City Health & Hosps. Corp., 2015 NY Slip Op 04706, 3rd Dept 6-4-15

 

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Statutory Prohibition of Court Review of Civil Service Commission’s Determination (Where the Employee Elects to Appeal to the Commission Before Seeking Judicial Review) Does Not Apply When Constitutional Rights Are Implicated or Where the Agency Has Acted Illegally or In Excess of Its Jurisdiction

The Third Department determined, despite a statutory provision prohibiting judicial review when the employee elects to appeal to the Civil Service Commission before seeking judicial review, the courts have the power to review the agency’s determination when the agency has acted in excess of its jurisdiction. Here the petitioner asserted her employment was terminated based on charges brought after the statute of limitations on those charges had passed. The Third Department agreed.  Although there is an exception to the application of the one-year statute of limitations when the charges constitute crimes, here the allegations of misconduct did not include the requisite mens rea for the crime of official misconduct (intent to gain a benefit and knowledge the conduct was unauthorized).  Therefore the one-year statute of limitations applied. With respect to the power to review the agency’s determination, the Third Department wrote:

Civil Service Law § 76 (3) provides that where, as here, an employee has elected to appeal to respondent before seeking judicial review, “[t]he decision of [respondent] shall be final and conclusive, and not subject to further review in any court” (see also Civil Service Law § 76 [1]). Such explicit statutory language ordinarily bars further appellate review … . However, statutory preclusion of all judicial review of the decisions rendered by an administrative agency in every circumstance would constitute a grant of unlimited and potentially arbitrary power too great for the law to countenance … . Thus, even when proscribed by statute, judicial review is mandated when constitutional rights are implicated by an administrative decision or “when the agency has acted illegally, unconstitutionally, or in excess of its jurisdiction”… . Matter of De Guzman v State of New York Civ. Serv. Commn., 2015 NY Slip Op 04712, 3rd Dept 6-4-15

 

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