You are here: / Administrative Law
, , ,

PETITIONER NYC FIREFIGHTER WAS DENIED ACCIDENTAL DISABILITY RETIREMENT (ADR) BENEFITS WITHOUT ANY EXPLANATION IN THE MEDICAL BOARD’S FINDINGS; THE MATTER WAS REMITTED FOR A NEW DETERMINATION BASED ON A RECORD ADEQUATE FOR REVIEW (FIRST DEPT).

The First Department, annulling the denial of accidental disability retirement (ADR) benefits in this firefighter-disability case, determined that the Medical Board’s failure to explain the reasons for its conclusion there was no accident and the injuries were not debilitating required remittal to the Medical Board and a new determination by the Board of Trustees with a record adequate for review:

… [T]he Medical Board found petitioner to be disabled on account of the left shoulder injuries he sustained on March 22, 2018. However, citing “inconsistencies” and a “lack of witnessed accounts . . . that would suggest . . . an accident,” the Board denied petitioner an ADR benefit. When the insufficient explanation was raised before the Board of Trustees, they acknowledged that a witness statement was not necessary, and stated that they did not understand what the Medical Board was referring to with regard to inconsistencies in the manner of petitioner’s injuries. Nevertheless, when the Board of Trustees reconsidered the matter, it simply took a vote on petitioner’s application without any deliberation or indication as to why he had been denied an ADR benefit, issuing a conclusory denial without any explanation as to why they had adopted the Medical Board’s unsupported statements about alleged inconsistencies concerning the nature of petitioner’s injuries.

The Medical Board failed to provide any factual basis concerning the alleged inconsistencies and why it did not believe petitioner’s injuries to be accidental. Further, the determination of the Medical Board was devoid of any articulated basis for its conclusion that the limitations of petitioner’s cervical and lumbar spine were not a debilitating or incapacitating condition for performing the duties of a firefighter. The failure to set forth an adequate statement of the factual basis for the determination forecloses the possibility of fair judicial review … . Matter of Reynolds v New York City Fire Pension Fund, 2022 NY Slip Op 06330, First Dept 11-10-22

Practice Point: Here the injured NYC firefighter was denied accidental disability retirement (ADR) but the Medical Board did not give any reasons for its conclusion. The findings were annulled and the matter remitted for a new determination and the creation of an adequate record for review.

 

/0 Comments/by
,

DEFENDANT PLED GUILTY TO DWI AND THE JUDGE REVOKED HIS DRIVERS LICENSE FOR ONE YEAR; THE DMV SUBSEQUENTLY DENIED DEFENDANT’S APPLICATION TO REINSTATE HIS LICENSE; DEFENDANT’S MOTION TO VACATE HIS CONVICTION ON THE GROUND HE WAS NOT AWARE HE COULD PERMANENTLY LOSE HIS LICENSE SHOULD HAVE BEEN DENIED (SECOND DEPT). ​

The Second Department, reversing Supreme Court, in a comprehensive decision worth consulting, determined defendant’s motion to vacate his DWI conviction should not have been granted: Defendant pled guilty and Supreme Court revoked his driving license for one year. When defendant applied to reinstate his drivers license he was notified by the Department of Motor Vehicles (DMV) that, based on his prior DWI-related convictions or incidents, his application had been denied. Defendant brought a  motion to vacate his conviction, arguing that his guilty plea was not knowing and voluntary because the plea was based on his understanding he would lose his license for one year. Supreme Court granted the motion and the People appealed:

The Supreme Court erred in granting the defendant’s motion to vacate the judgment of conviction on the ground that his plea of guilty was not entered knowingly, voluntarily, and intelligently. The subject regulation that led to the denial of the defendant’s application for relicensing did not exist at the time he entered his plea of guilty, and it would have been impossible for the court to inform the defendant of consequences flowing therefrom … . “‘The defendant’s grievance lies with the enactment and enforcement of the new regulation, not the manner of his conviction'” … .

To the extent that the potentially permanent license revocation authorized under the subject regulation is a consequence of the defendant’s instant plea of guilty at all (see People v Avital, 64 Misc 3d 483, 485 [Town of East Fishkill Just Ct, Dutchess County] [denial of relicensing under 15 NYCRR 136.5 results not from any particular conviction, but from the applicant’s “complete driving history”]), it is, as the defendant acknowledges, a collateral consequence of his plea … . * * *

… [A] consequence of a conviction must represent an exceptionally severe liberty deprivation [i.e., deportation] in order to fall within the narrow category of collateral consequences of which a defendant must be advised at the time of entering the plea. … [W]e cannot conclude that the permanent loss of a driver license fits into that category. People v Maggio, 2022 NY Slip Op 06262, Second Dept 11-9-22

Practice Point: Defendant pled guilty to DWI knowing his license would be revoked by the court for one year. His application to reinstate his license was subsequently denied by the DMV. The fact that defendant’s license could be revoked permanently by the DMV was a collateral consequence of the plea which did not affect the voluntariness of the plea. A defendant need not be aware of a collateral consequence to render a plea voluntary. The rare exception is a collateral consequence which affects a liberty interest, deportation for example.

 

/0 Comments/by
,

WHETHER A PRIVATE COLLEGE ACTED IRRATIONALLY OR ARBITRARILY AND CAPRICIOUSLY IN ELIMINATING FACULTY POSITIONS IN RESPONSE TO A BUDGET SHORTFALL IS PROPERLY DETERMINED IN AN ARTICLE 78 PROCEEDING; HERE THE COLLEGE FOLLOWED THE RELEVANT RULES IN THE COLLEGE MANUAL; SUPREME COURT SHOULD NOT HAVE RULED THE COLLEGE ACTED ARBITRARILY AND CAPRICIOUSLY (THIRD DEPT).

The Third Department, reversing Supreme Court, determined the respondent private college followed the relevant provisions of the college manual in determining what programs and faculty positions to eliminate in response to a budget shortfall. Petitioners, members of the music department faculty whose positions were eliminated, did not demonstrate the respondents’ decisions were irrational or arbitrary and capricious:

A private college, “having accepted a charter and having thus become a quasi-governmental body, can be compelled in a[ CPLR] article 78 proceeding to fulfill not only obligations imposed upon them by State or municipal statutes but also those imposed by their internal rules” …  Thus, a CPLR article 78 proceeding is the appropriate vehicle for judicial review of matters involving a determination of a professor’s benefits and privileges of his or her academic tenure … .

As “the administrative decisions of educational institutions involve the exercise of highly specialized professional judgment and these institutions are, for the most part, better suited to make relatively final decisions concerning wholly internal matters” … . Deference should be accorded to a college’s determination, “and judicial review is circumscribed to whether the [college] failed to substantially comply with its internal rules and whether its decision was arbitrary [and] capricious or made in bad faith … . ….

… [T]he record confirms … there were no procedural rule violations. …

… [T]he record confirms that Supreme Court did not give appropriate deference to respondents’ interpretation of the termination preference — as set forth in chapter 2, § E (1) (1.6) of the manual …  — and that Supreme Court improperly concluded that respondents’ determination was arbitrary and capricious.  Matter of Hansbrough v College of St. Rose, 2022 NY Slip Op 05915, Third Dept 10-20-22

Practice Point: A court’s Article 78 review of a private college’s elimination of faculty positions in response to a budget shortfall is limited to a determination whether the college acted irrationally or arbitrarily and capriciously. Here the record indicated the college followed the relevant rules in the college manual, i.e.,  the college acted rationally.

 

/by
, , ,

​ AN AMENDED REGULATION DESIGNED TO PROTECT THE INTERESTS OF LIFE-INSURANCE AND ANNUITY CONSUMERS IS NOT VOID FOR VAGUENESS AND WAS PROPERLY CRAFTED AND ISSUED BY THE NYS DEPARTMENT OF FINANCIAL SERVICES (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Singas, reversing the appellate division, determined an amended regulation designed to protect the interests of life-insurance and annuity consumers was not void for vagueness and was properly crafted and issued by the NYS Department of Financial Services (DFS):

The amendment addressed concerns that the purchase of annuities and life insurance had become increasingly complex with more products available to purchase. DFS reasoned that consumers, finding themselves more reliant on professional advice in order to understand the options available and to make purchasing decisions, had become more susceptible to producers and insurers recommending transactions that prioritized their own compensation over the consumer’s best interest … . The amendment … extended the scope of the regulation to cover both annuity and life insurance contracts, and created a new standard applicable when producers and insurers make “recommendations” to consumers. The amended regulation, which applies to both “sales transactions” and “in-force transactions” … , requires that producers, or insurers when no producer is involved, act in the “best interest of the consumer” when making a “recommendation” … .

The producer or insurer must, among other things: make “reasonable efforts” to obtain the consumer’s “suitability information”; base any recommendation “on an evaluation of the relevant suitability information” that “reflects the care, skill, prudence, and diligence that a prudent person acting in a like capacity and familiar with such matters would use under the circumstances then prevailing”; “[o]nly [consider] the interests of the consumer . . . in making the recommendation” and not be influenced by compensation or other incentives; recommend only “suitable” transactions; and have a “reasonable basis” to believe that the consumer has been reasonably informed of the features of the policy, the potential consequences of the transactions, both favorable and unfavorable, and that the consumer would benefit from certain features of the policy and the particular policy as a whole … . Matter of Independent Ins. Agents & Brokers of N.Y., Inc. v New York State Dept. of Fin. Servs., 2022 NY Slip Op 05917, CtApp 10-20-22

Practice Point: An amended regulation designed to protect the interests of life-insurance and annuity consumers is not void for vagueness and was properly created and issued by the NYS Department of Financial Services. The amendment seeks to ensure the advice given to consumers does not place the financial compensation of the insurer ahead of the best interests of the consumer.

 

/by
,

DISNEY WAS DEDUCTING ROYALTY PAYMENTS MADE BY AFFILIATES WHICH DID NOT PAY NEW YORK TAXES; THE TAX LAW WAS DESIGNED TO PLUG THAT “LOOPHOLE” AND THE DEDUCTIONS WERE PROPERLY DISALLOWED (THIRD DEPT).

The Third Department, in a full-fledged opinion by Justice Fisher, determined the Tax Law did not permit petitioner to deduct royalty payments made by affiliates organized under the law of foreign countries pursuant to intellectual-property licensing agreements. The opinion is too detailed and comprehensive to be fairly summarized here: Essentially, the petitioner was deemed to be taking advantage of a “loophole” to avoid paying franchise taxes which had been addressed and closed by the Tax Law:

At the hearing, the Department’s employees testified that petitioner was denied the royalty deduction because the foreign affiliates it had received payments from were not New York taxpayers. The ALJ [Administrative Law Judge] found that “[t]he addback and exclusion provisions contained in Tax Law [§ 208 former] (9) (o) work in tandem to ensure that royalty transactions between related members are taxed only once” and do “not escape taxation altogether.” In determining that petitioner’s interpretation of the statute effectively allowed it to avoid taxation on that income, which went against the Legislature’s intent in enacting the statute, the ALJ concluded that the Department’s interpretation of the statute was rational and therefore petitioner was not permitted to deduct royalty payments from its income. When the Tribunal affirmed the findings of the ALJ, it added that “the [L]egislature did not intend for a taxpayer to gain the benefit of the income exclusion . . . without the corresponding cost to a related member of the add back.”  Matter of Walt Disney Co. & Consol. Subsidiaries v Tax Appeals Trib. of the State of N.Y., 2022 NY Slip Op 05898, Third Dept 10-20-22

Practice Point: Disney was deducting royalty payments made by affiliates which did not pay New York taxes. The Third Department determined the Tax Law did not allow the deductions.

 

/by
, ,

NYC DEPARTMENT OF EDUCATION’S (DOE’S) DENIALS OF PETITIONERS’ APPLICATIONS FOR ADMISSION TO THE CITY’S SPECIALIZED HIGH SCHOOLS (SHS’S) WERE NOT ARBITRARY AND CAPRICIOUS (THIRD DEPT). ​

The Third Department, in a full-fledged opinion by Justice Clark, determined the NYC Department of Education’s (DOE’s) denials of petitioners’ applications for admission to NYC’s Specialized High Schools (SHS’s) were not arbitrary and capricious. The opinion includes a detailed history of the SHS’s and detailed explanations of the criteria for admission of students deemed to be disadvantaged within meaning of the SHS’s Discovery program. The petitioners were not disadvantaged students. It is difficult to discern the precise nature of the petitioners’ claims from the opinion, but it appears petitioners were questioning the propriety of the implementation of the Discovery program for disadvantaged students. Matter of C.K. v Tahoe, 2022 NY Slip Op 05899, Third Dept 10-20-22

Practice Point: In this Article 78 proceeding the petitioners were students who were denied admission to NYC’s Specialized High Schools (SHS’s), The petitioners, who were not disadvantaged within the meaning the SHS’s Discovery program, apparently questioned the propriety of the implementation of the Discovery program for disadvantaged students. The Third Department held that the Department of Education’s denials of the petitioners’ applications for admission were not arbitrary and capricious.

 

/by
, , , ,

THE TOWN BOARD OF APPEALS’ FAILURE TO ISSUE A DECISION ON PETITIONER’S APPLICATION FOR A SPECIAL EXCEPTION PERMIT AND AN AREA VARIANCE WITHIN THE 62 DAYS PRESCRIBED BY THE TOWN LAW WAS NOT A DENIAL BY DEFAULT; THEREFORE SUPREME COURT DID NOT HAVE SUBJECT MATTER JURISDICTION AND THE MATTER WAS NOT RIPE FOR REVIEW; SUPREME COURT SHOULD NOT HAVE ANNULLED THE “DEFAULT DENIAL” AND ORDERED THE TOWN TO ISSUE THE PERMIT AND VARIANCE (SECOND DEPT).

The Second Department, reversing Supreme Court, determined: (1) the town Board of Appeals’ failure to issue a decision on petitioner’s application for a special exception permit and an area variance within the 62 days prescribed by the Town Law was not a denial of the application by default; (2) Supreme Court should not have treated the failure to issue a timely decision as a denial by default. which it then annulled, ordering the town to issue the permit and the variance; and (3) Supreme Court should not have denied the Board’s motion to vacate Supreme Court’s order and judgment (ordering the issuance of the permit and variance):

Pursuant to Town Law § 267-a(8), the Board must render a decision within 62 days after the close of the hearing. The Town Law also contains a default provision which provides that if the Board, in exercising its appellate jurisdiction, fails to render a decision within 62 days of the hearing, the application is deemed denied (see id. § 267-a[13][b]). …

A proceeding to annul a determination by an administrative body “should not be concluded in the petitioner’s favor merely upon the basis of a failure to answer the petition on the return date thereof, unless it appears that such failure to plead was intentional and that the administrative body has no intention to have the controversy determined on the merits” … . Here, there was no evidence demonstrating a deliberate default by the Board … .

Contrary to the petitioner’s contention, its application for a special exception permit was not denied by default. The Board’s failure to comply with the time period prescribed by Town Law § 267-a(8) only results in a denial by default when the Board exercises its appellate jurisdiction (see id. § 267-a[13][b]). The Board exercises its original jurisdiction in special exception cases … , and thus, there was no denial by default of the petitioner’s application for a special exception permit … . With no final determination having been rendered on the application for a special exception permit, that issue was not ripe for judicial review, and the Supreme Court lacked subject matter jurisdiction over that issue … . We note that ripeness “is a matter pertaining to subject matter jurisdiction which may be raised at any time, including sua sponte” … . Matter of 999 Hempstead Turnpike, LLC v Board of Appeals of the Town of Hempstead, 2022 NY Slip Op 04721, Second Dept 7-29-22

Practice Point: A town Board of Appeals’ failure to issue a decision on an application for a permit and an area variance within the 62 days prescribed by the Town Law is not a denial of the petition by default. Supreme Court, therefore, did not have subject matter jurisdiction over he purported “denial by default” and the matter was not ripe for review.

 

/by
,

IN A HYBRID ACTION SEEKING AN ANNULMENT PURSUANT TO ARTICLE 78 AND A DECLARATORY JUDGMENT (AND DAMAGES), THE BURDENS TO DEMONSTRATE STANDING ARE DIFFERENT; IN AN ARTICLE 78 THE PETITIONER MUST AFFIRMATIVELY DEMONSTRATE STANDING; AND IN A DECLARTORY-JUDGMENT/DAMAGES ACTION, THE RESPONDENT (DEFENDANT) MUST DEMONSTRATE PETITIONER DOES NOT HAVE STANDING AS A MATTER OF LAW TO WARRANT SUMMARY JUDGMENT (SECOND DEPT).

The Second Department, reversing Supreme Court, explained the different burdens of proof in an Article 78 proceeding and an action seeking declaratory relief and damages. In an Article 78 proceeding, the petitioner has to show standing as part of its prima facie case. In a declaratory judgment/damages action, the respondent (defendant) has to demonstrate the petitioner does not have standing as a matter of law to warrant summary judgment:

The Supreme Court erred in granting the respondents’ motion to dismiss the proceeding/action based on lack of standing. “‘In a hybrid proceeding and action, separate procedural rules apply to those causes of action which are asserted pursuant to CPLR article 78, on the one hand, and those to recover damages and for declaratory relief, on the other hand'” … . Generally, in an action to recover damages, “[o]n a defendant’s motion to dismiss the complaint based upon the plaintiff’s alleged lack of standing, the burden is on the moving defendant to establish, prima facie, the plaintiff’s lack of standing. To defeat a defendant’s motion, the plaintiff has no burden of establishing its standing as a matter of law; rather, the motion will be defeated if the plaintiff’s submissions raise a question of fact as to its standing” … . Within the context of a special proceeding pursuant to CPLR article 78, “[t]he petitioner ‘has the burden of establishing both an injury-in-fact and that the asserted injury is within the zone of interests sought to be protected by the statute alleged to have been violated'” … . Matter of Crown Castle NG E., LLC v City of Rye, 2022 NY Slip Op 04626, Second Dept 7-20-22

Practice Point: The burdens on the issue of standing are different in an Article 78 proceeding and a declaratory judgment/damages action. Here both were brought in a hybrid proceeding. The petitioner must demonstrate standing in the Article 78 proceeding. The respondent (defendant) must demonstrate petitioner does not have standing as a matter of law to warrant summary judgment in the declaratory judgment/damages action.

 

/by
, ,

DUE TO A CONTRACTOR’S ERROR, PETITIONER’S SWIMMING POOL WAS INSTALLED SIX FEET FROM THE PROPERTY LINE, VIOLATING THE 14-FOOT SETBACK REQUIREMENT; THE ZONING BOARD OF APPEALS PROPERLY DENIED THE PETITIONER’S APPLICATION FOR A VARIANCE; SUPREME COURT REVERSED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the zoning board of appeals (ZBA) properly took into the considerations the factors prescribed by the Town Law when it denied petitioner’s application for a setback variance. The setback requirement for a swimming was 14 feet. Due to an error made by the contractor, petitioner’s pool was installed six feet from the property line:

The record indicates that the ZBA considered the five factors set forth in Town Law § 267-b(3) and conducted the relevant balancing test to reach its determination. The ZBA found that the requested variance would produce an undesirable change in the character of the neighborhood because there was no evidence of any similarly located in-ground pools. The ZBA explained that approving a pool with such a small setback where there are no similar structures in the neighborhood would establish an unwarranted precedent for future development of the area, which could result in a detriment to nearby properties. The ZBA properly considered the possibility that granting the requested variance could set a negative precedent in the area … . Based on the property survey, the ZBA determined that the petitioner could have placed the pool in a conforming location. Moreover, the petitioner presented no evidence that the property could not be utilized without violating the zoning code. The ZBA determined that the requested variance was substantial because it asked for a 57% relaxation of the zoning code. Taking into account the rationale for the required setback, which was to protect the privacy and quiet enjoyment of adjacent residential properties, as well as the fact that the location of the pool was inconsistent with the nature and character of the surrounding area, and that the approval of the requested variance would establish an unwarranted precedent for future development of the area, the ZBA determined that granting the requested variance would have an adverse effect on the physical or environmental conditions in the neighborhood. Finally, the ZBA’s finding that the petitioner’s zoning violation, which was the result of the contractor’s error, was self-created is well founded … . Matter of Dutt v Bowers, 2022 NY Slip Op 04546, Second Dept 7-13-22

Practice Point: Due to a contractor’s error, the petitioner’s swimming pool was installed six feet from the properly line, violating the 14-foor setback requirement. The petitioner applied for a variance. The Zoning Board of Appeal properly considered all the factors prescribed the Town Law and denied the variance. Supreme Court granted the variance. The Second Department reversed.

 

/by
,

PETITIONER HELD HIMSELF OUT AS THE FINANCIAL DECISION-MAKER OF THE BUSINESS AND THE TAX TRIBUNAL PROPERLY FOUND PETITIONER WAS PERSONALLY LIABLE FOR UNPAID EMPLOYEE WITHHOLDING TAXES; THE TWO DISSENTERS ARGUED THAT PETITIONER WAS NOT THE FINANCIAL DECISION-MAKER AND WAS PUT IN CHARGE ONLY TO ALLOW THE BUSINESS TO BE CERTIFIED AS A MINORITY BUSINESS-ENTERPRISE; THE IRS IN A PARALLEL PROCEEDING HAD ABSOLVED PETITIONER OF LIABILITY (THIRD DEPT).

The Third Department, over a two-justice dissent, determent the Tax Tribunal properly found that petitioner was a “responsible person” such that he can be held personally liable for unpaid employee withholding taxes. According to the dissent, petitioner held himself out as the business’s (NECC’s) financial decision-maker as part of an agreement with the 51% shareholder, Anthony Nastasi (the actual financial decision-maker) in order that the business would be certified as a minority business-enterprise and be eligible for certain state contracts as a result. In a parallel proceeding brought against petitioner by the IRS, petitioner was absolved of liability:

Notwithstanding evidence that could support a contrary determination, it is undisputed that petitioner was president, the majority shareholder, had check signing authority, was involved in daily field operations and derived a substantial part of his income from NECC. Additionally, petitioner intentionally held himself out to third parties, as well as to the Division of Taxation itself, as the contact person and responsible person for New York taxes by signing state tax returns and checks accompanying the returns, executing a sales tax certificate of authority listing himself as the corporation’s responsible person, filling out the Division’s “Responsible Person Questionnaire,” and maintaining communication with the Department. Accordingly, respondent’s determination that petitioner is a responsible person has a rational basis, is supported by substantial evidence and must be upheld … . Matter of Black v New York State Tax Appeals Trib., 2022 NY Slip Op 04200, Third Dept 6-30-22

Practice Point: Even though there was evidence petitioner was put in charge of the business solely to allow it to be certified as a minority business enterprise, the Third Department upheld the Tax Tribunal’s determination that petitioner was a “responsible person” liable for unpaid employee withholding taxes. The two dissenters argued petitioner was not a “responsible person” and should be absolved of liability, which was the result in the parallel IRS proceeding. The result in this case was dictated by the standard for appellate review of an administrative determination. As long as there is evidence in the record which supports the Tax Tribunal’s ruling, the ruling will be deemed rational and upheld.

 

/by

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

Copyright © 2022 New York Appellate Digest, LLC
Site by CurlyHost | Privacy Policy