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Question of Fact About Whether Private Entity Managing Public Funds Can Recoup Payments Which Were Above Minimum Fees Required by the Medicare Fee Schedule

Plaintiffs, emergency and ambulance service-providers, brought an action in response to defendant’s reduction in Medicare payments made to recoup alleged overpayments in prior years.  In finding plaintiffs had raised a question of fact about whether defendant was entitled to recoup the alleged overpayments, the Fourth Department wrote:

We agree with plaintiffs that the applicable Medicare fee schedule set a minimum payment, but not a maximum payment, for the services that plaintiffs provided (see 42 USC § 1395w-22 [a] [2] [A]).  On the one hand, if defendant had paid plaintiffs the minimum fees required by the applicable Medicare fee schedule, then plaintiffs would not be entitled to object to those payments as being insufficient (see 42 CFR 422.214 [a] [1]).  On the other hand, however, while defendant paid plaintiffs more than the minimum amount required by the fee schedule for a period of time, defendants have failed to establish that defendant is entitled as a matter of law to recoup any or all of those funds from plaintiffs.  Although the common law right of a governmental agency to recoup erroneously distributed public funds is well established … , that right does not necessarily extend to defendant, a private entity managing public funds… . Canandaigua Emergency Squad, Inc. … v Rochester Area Health Maintenance Organization, Inc…, 632, 4th Dept 7-19-13

 

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Contract Between Town and Employer of Injured Employee Did Not Allow Indemnification of Town by Employer

In a Labor Law action seeking damages for a fall from the roof of a building under construction, the Fourth Department determined Supreme Court should have dismissed the town’s motion for contractual indemnification against plaintiff’s employer because the contract was not intended to be retroactive to the day of the injury.  The Fourth Department explained the applicable law as follows:

“Workers’ Compensation Law § 11 prohibits a third-party action against an employer unless the plaintiff sustained a grave injury or there is ‘a written contract entered into prior to the accident or occurrence by which the employer had expressly agreed to contribution or indemnification of the [third party plaintiff]’ ”… .  The Town concedes that plaintiff did not suffer a “grave injury,” and that it is entitled to indemnification only if it can demonstrate the existence of a written contract.  “When a party is under no legal duty to indemnify, a contract assuming that obligation must be strictly construed to avoid reading into it a duty which the parties did not intend to be assumed” … .  Meabon v Town of Poland…, 634, 4th Dept 7-19-13

 

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Pecuniary Loss Defined

In a wrongful death action, the Fourth Department determined that plaintiff, decedent’s brother, was entitled only to pecuniary loss for funeral expenses.  In explaining pecuniary loss, the court wrote:

Damages in a wrongful death action are limited to “fair and just compensation for the pecuniary injuries resulting from the decedent’s death to the persons for whose benefit the action is brought” (EPTL 5-4.3 [a]).  “Pecuniary loss” is defined as “the economic value of the decedent to each distributee at the time decedent died” and includes loss of income and financial support, loss of household services, loss of parental guidance, as well as funeral expenses and medical expenses incidental to death….  Generally, because it is difficult to provide direct evidence of wrongful death damages, the calculation of pecuniary loss “is a matter resting squarely within the province of the jury”… .  On this record, we conclude that there are issues of fact with respect to whether plaintiff, as decedent’s brother, suffered pecuniary loss in the form of funeral expenses and whether decedent’s brother Matthew suffered pecuniary loss given the evidence of their longstanding close and interdependent relationship.  Milczarski … v Walaszek…, 656, 4th Dept 7-19-13

 

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Failure to Appeal Dismissal of Underlying Medical Malpractice Action Did Not Preclude Related Legal Malpractice Action

The Fourth Department, over a dissent, allowed a legal malpractice action to go forward, finding that the plaintiff’s failure to appeal the dismissal of the underlying federal medical malpractice action did not preclude the related legal malpractice action. In the federal action, the court determined a physician was an independent contractor, not a government employee, and therefore had to be named individually as a defendant. The action against the physician was dismissed as time-barred. The dissent argued “if plaintiff had been successful in his appeal of the underlying federal action, we would not have a subsequent legal malpractice case.”  In holding that the failure to appeal the federal ruling did not preclude the legal malpractice action, the Fourth Department distinguished a prior case, Rupert v Gates and Adams, PC, 83 AD3d 1383, relied upon by the defendants:

We reject defendants’ invitation to extend the ruling in Rupert to a per se rule that a party who voluntarily discontinues an underlying action and forgoes an appeal thereby abandons his or her right to pursue a claim for legal malpractice. …

Although the precise question presented herein appears to be an issue of first impression in New York, we note that several of our sister states have rejected the per se rule advanced by defendants herein… .  … [S]uch a rule would force parties to prosecute potentially meritless appeals to their judicial conclusion in order to preserve their right to commence a malpractice action, thereby increasing the costs of litigation and overburdening the court system ….  The additional time spent to pursue an unlikely appellate remedy could also result in expiration of the statute of limitations on the legal malpractice claim ….  Further, requiring parties to exhaust the appellate process prior to commencing a legal malpractice action would discourage settlements and potentially conflict with an injured party’s duty to mitigate damages… .  Grace v Law, et al, 625, 4th Dept 7-19-13

 

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Fact that Medical Guidelines May Be Available to the Public Does Not Warrant Denial of Discovery of Such Documents from the Defendant

The Fourth Department determined Supreme Court had erred in denying certain of plaintiff’s discovery demands in a medical malpractice case alleging injuries sustained by infant plaintiff during birth.  The materials deemed material and necessary (and not unduly burdensome to produce) included: standards for fetal monitoring and pediatric advancement of life support; a protocol entitled “Circulating Vaginal Delivery;” interpretation and management of fetal heart rate patterns; and specified guidelines and standards published by medical associations.  The Fourth Department noted that the fact that standards and guidelines may be available to the public is not a ground for denying discovery.  The court explained the discovery criteria generally as follows:

…[W]e note that CPLR 3101 requires “full disclosure of all matter material and necessary in the prosecution or defense of an action” (CPLR 3101 [a]).  The phrase “ ‘material and necessary should be interpreted liberally to require disclosure, upon request, of any facts bearing on the controversy which will assist preparation for trial by sharpening the issues and reducing delay and prolixity. The test is one of usefulness and reason’ ”… .  “Entitlement to discovery of matter satisfying the threshold requirement is, however, tempered by the trial court’s authority to impose, in its discretion, appropriate restrictions on demands which are unduly burdensome . . . and to prevent abuse by issuing a protective order where the discovery request may cause unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice to any person or the courts”  (…see CPLR 3103 [a]).  In opposing a motion to compel discovery, a party must “establish that the requests for information are unduly burdensome, or that they may cause unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice to any person or the courts” (…see generally CPLR 3103 [a]).  Rawlins…v St Joseph’s Hospital Health Center…, 659, 4th Dept 7-19-13

 

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Supreme Court’s Setting Aside Jury Verdict Reversed; Use of Juror-Affidavits to Correct Mistake in Verdict Okay

In a medical malpractice case, the Fourth Department reversed Supreme Court’s setting aside the jury verdict which found the negligence of one defendant (Caputo) was not a substantial factor in causing plaintiff’s injuries. In addition, over a dissent, the Fourth Department found the use of juror affidavits to correct a mistake in the verdict was proper.  The Fourth Department wrote:

“A verdict finding that a defendant was negligent but that such negligence was not a proximate cause of the [plaintiff’s injuries] is against the weight of the evidence only when [those] issues are so inextricably interwoven as to make it logically impossible to find negligence without also finding proximate cause”….  “Where a verdict can be reconciled with a reasonable view of the evidence, the successful party is entitled to the presumption that the jury adopted that view” … .  Here, plaintiffs alleged four different theories of negligence against Dr. Caputo, and we conclude that there is a reasonable view of the evidence to support a finding that Dr. Caputo was negligent in failing to provide [the] resident staff with adequate information concerning the operative procedure and plaintiff’s postoperative care, but that such failures were not the proximate cause of plaintiff’s injuries… .

…[T]he court properly granted plaintiffs’ “supplemental motion” to correct the verdict with respect to the award of damages for plaintiff’s future pain and suffering.  In support of the “supplemental motion,” plaintiffs submitted affidavits from all six jurors, who averred that they understood and agreed that plaintiff would receive $60,000 per year for a period of 30 years, not a total of $60,000 over the course of that period….  We acknowledge that “public policy concerns disfavor the use of juror affidavits for posttrial impeachment of a verdict” … .  Here, however, “[t]he information afforded by the affidavits of the jurors is not to impeach, but to support the verdict really given by them”… .  Butterfield v Caputo, et a;l, 602, 4th Dept 7-19-13

 

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Expert’s Affidavit Too Speculative to Raise Question of Fact About Proximate Cause

In reversing Supreme Court and dismissing a medical malpractice complaint, the Fourth Department determined plaintiff’s expert affidavit was speculative and therefore failed to raise a question of fact about whether the alleged negligence (the failure to order a particular CT scan) was the proximate cause of the injury:

The expert contends that, if that CT scan had been performed on February 16, 2004, “then diagnosis of [decedent]’s aortic dissection . . . would, more probably than not, have been made.”  Significantly, however, the medical records indicate that it was a CT scan of decedent’s head and chest, not a scan of his pelvis and abdomen, that revealed an aortic dissection on March 1, 2004.  Thus, the opinion of plaintiff’s expert that an abdominal and pelvic CT scan performed on February 16, 2004 would more likely than not have revealed an aortic dissection is speculative.  Wilk … v James, et al, 401, 4th Dept 7-19-13

 

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Denial of Father’s Petition for Modification of Custody Reversed

In reversing Family Court and granting father’s petition for a modification of a prior custody order awarding custody to mother, the Fourth Department wrote:

“Generally, a court’s determination regarding custody and visitation issues, based upon a first-hand assessment of the credibility of the witnesses after an evidentiary hearing, is entitled to great weight and will not be set aside unless it lacks an evidentiary basis in the record” … .  Here, we conclude that the court’s determination that it is in the best interests of the child to remain in the custody of the mother lacks a sound and substantial basis in the record.  ,,,

As a preliminary matter, we conclude that the court abused its discretion in failing to “draw the strongest inference that the opposing evidence permits” against the mother based upon her failure to appear for the hearing …, although we note that the court stated that it was doing so.  Although the court properly determined that the father failed to take steps to enforce his right to visit with the child, the court failed to credit the testimony of the mother’s family that the mother interfered with the father’s ability to visit the child; that the mother disparaged the father in the child’s presence; that, despite the court’s order granting telephone access to the child, the access lasted only two weeks; that the mother was verbally abusive to the child; that the child was afraid of her mother; and that the mother exhibited behaviors that support a determination that she failed to provide a proper home environment and parental guidance for the child … .  Further, the court failed to credit the evidence, including testimony and school records, that the mother failed to provide for the child’s emotional development and that the child’s intellectual and emotional development was supported by the mother’s family members and long-term friend, rather than by the mother ….  We note that there is no evidence that the mother has the financial ability to provide for the child and that the evidence establishes that the father has a job, a home, and pays child support … .

Although the court properly determined that the child “barely knows” the father, we conclude that the court erred in failing to give any weight to the 14-year-old child’s preference to live with the father rather than the mother, where, as here, the record establishes that her age and maturity would make her input “particularly meaningful”… . Matter of Lara … v Sullivan, 818, 4th Dept 7-19-13

 

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Termination of Parental Rights Affirmed Because Diligent Efforts to Reunite Parent and Child Were Made (In Spite of Misdiagnosis of Mother’s and Child’s Psychological Conditions)

The Fourth Department, over a dissent, affirmed Family Court’s termination of mother’s parental rights.  The dissent argued that the misdiagnosis of both the mother’s and child’s psychological conditions rendered the efforts to reunite the mother with the child inadequate.  The Fourth Department wrote:

Contrary to the contention of the mother, Family Court properly determined that petitioner made diligent efforts to reunite her with the child (see Social Services Law § 384-b [7] [a], [f]).  Among other things, petitioner arranged for a psychological assessment of the mother, arranged for therapy sessions for the mother and various services for the child, and provided the mother with parenting, budgeting, and nutrition education training.  Petitioner also provided the mother with supervised and unsupervised visits with the child. Most significantly, petitioner arranged for a child psychologist to meet with the mother on several occasions in her home to provide parenting training, and we agree with the court’s assessment that this was “truly a diligent effort” by petitioner to encourage and strengthen the parent-child relationship.

Contrary to the further contention of the mother, the court properly determined that she failed to plan for the future of the child (see Social Services Law § 384-b [7] [a]).  “ ‘[T]o plan for the future of the child’ shall mean to take such steps as may be necessary to provide an adequate, stable home and parental care for the child” (§ 384-b [7] [c]).  “At a minimum, parents must ‘take steps to correct the conditions that led to the removal of the child from their home’ ” (Matter of Nathaniel T., 67 NY2d 838, 840).  Here, while the mother participated in the services offered by petitioner and had visitation with the child, the evidence established that she was unable to provide an adequate, stable home for the child and parental care for the child… .  Matter of Cayden LR, 575, 4th Dept 7-19-13

 

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Defendant’s Failure to Appear at Pre-Trial Conference Did Not Warrant Striking Answer

The Third Department reversed Supreme Court’s striking of defendant’s answer as a penalty for defendant’s not appearing at a pre-trial conference as ordered:

Generally speaking, and based upon sound underlying policy, there is a strong judicial preference for determination of issues upon the merits ….  Consistent with this policy, defendant’s failure to comply with the court’s directive for in-person appearance at a pretrial conference is not punishable by an order striking the pleadings. The applicable rule instead specifically authorizes the court only to deem a party’s failure to comply  “a default under  CPLR  3404,” which  results in removal  of the case from  the trial calendar (22 NYCRR 202.26 [e]…).  CBA Properties LLC v Global Airlines Services Inc, 515868, 3rd Dept 7-18-13

 

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