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Principal’s Failure to Follow the Performance-Rating Procedures Required by the School District and Collective Bargaining Agreement Deprived a School Social Worker of a Fair Review Process—Unsatisfatory Rating (U-Rating) Annulled

The First Department determined the principal’s failure to comply with the relevant performance-rating procedures deprived petitioner, a school social worker, of a fair review process.  Petitioner’s unsatisfactory rating (U-rating) was annulled:

Petitioner establishes that in evaluating her performance, respondents did not adhere to their procedures or those provided in the parties’ collective bargaining agreement. Special Circular No. 45, a memorandum issued by respondents in response to the mandate set forth in the Commissioner of Education Regulations (8 NYCRR) § 100.2(o), outlines the procedures for rating professional personnel, as does the related manual produced by the New York City Public Schools, entitled Rating Pedagogical Staff Members. Specifically, as a pedagogical employee, petitioner was to be given at least one full period of review during the school year by her principal, followed by a meeting with the principal to discuss her strengths and any areas in need of improvement. Additionally, as a social worker employed at a school, she should have been evaluated by the school principal in consultation with the in-discipline supervisor, in accordance with the collective bargaining agreement. * * *

…[T]he complete absence of constructive criticism and warnings during the entire school year, compounded by the lack of a formal observation and accompanying feedback during the school year, “undermined the integrity and fairness of the process” … . Accordingly, the judgment should be reversed, and the petition granted to the extent of annulling the U-rating. Matter of Murray v Board of Educ. of the City School Dist. of the City of N.Y., 2015 NY Slip Op 06866, 1st Dept 9-22-15

 

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Licensing Officer Has Broad Discretion Re: Denial of Application for a Pistol Permit

In upholding the denial of an application for a pistol permit, the Second Department explained the broad discretion afforded the licensing officer:

Penal Law § 400.00(1), which sets forth the eligibility requirements for obtaining a pistol license, requires, inter alia, that the applicant be at least 21 years of age, of good moral character with no prior convictions of a felony or serious offense, who has not had a license revoked or who is not under a suspension or ineligibility order, and a person “concerning whom no good cause exists for the denial of the license” (Penal Law § 400.00[1][n]…). “A pistol licensing officer has broad discretion in ruling on permit applications and may deny an application for any good cause” (… see Penal Law § 400.00[1][n]…).

Contrary to the petitioner’s contention, the licensing officer’s determination that good cause existed to deny the application was not arbitrary and capricious. The determination was rationally based, inter alia, on the petitioner’s criminal history … . Moreover, the licensing officer, by her own observation, found that the petitioner had issues with judgment, credibility, the ability to stay in control, and general moral fitness. Matter of Lawtone-Bowles v Klein, 2015 NY Slip Op 06669, 2nd Dept 8-26-15

 

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Sexual Harassment Findings Affirmed

The Third Department affirmed the State Division of Human Rights’ (SDHR’s) determination that respondent corrections officer had been subjected to sexual harassment (creating a hostile work environment) and was entitled to economic and noneconomic damages. The court noted that its review powers were “narrow” and were confined to whether the Commissioner of Human Rights’ rulings were rational in light of the evidence. The court further noted that the Commissioner should not have offset the award based upon past and future workers’ compensation benefits, and the commissioner should have considered respondent’s loss of pension benefits. In explaining its review criteria, the court wrote:

When reviewing a determination made by the Commissioner in a matter such as this one, our purview is “extremely narrow” and must focus not on whether we would have reached the same result as did the Commissioner, but instead on whether the Commissioner’s determination was rational in light of the evidence presented … . Such deference is due given SDHR’s expertise in evaluating discrimination claims … . A violation of Executive Law § 296 based on a hostile work environment must be supported by proof that the “workplace [was so] permeated [by a] discriminatory” atmosphere that it “alter[ed] the conditions of the [complainant’s] employment” … . “Where, as here, there is a finding of a hostile work environment as a result of sexual harassment, the evidence in the record must establish the pertinent elements, including proof that the discriminatory conduct occurred due to the complainant’s gender”… . Matter of Rensselaer County Sheriff’s Dept. v New York State Div. of Human Rights, 2015 NY Slip Op 06551, 3rd Dept 8-13-15

 

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Even Though the Insured Was Faultless, the “Additional Insureds” Endorsement Was Triggered—The Endorsement Covered Acts or Omissions by the Insured Which “Caused” the Underlying Injury Without Any Requirement that the “Cause” Entail Negligence—Here the Insured Was Not Negligent, but the Injury Was “Caused” by Insured’s Non-Negligent Acts—Therefore the Additional Insureds Were Covered Under the Policy

The First Department, in a full-fledged opinion by Justice Friedman, determined that the “additional insureds” endorsement in plaintiff-insurer’s policy did not have a “negligence trigger.” Therefore, even though it was demonstrated that the company insured under plaintiff-insurer’s policy was not negligent, the endorsement covered the “additional insureds” because there was a causal relationship between the insured’s acts and the underlying injury to a worker. The insured company, Breaking Solutions, was hired by the New York City Transit Authority (NYCTA) and the Metropolitan Transit Authority (MTA) to break up concrete for a subway construction project. Plaintiff-insurer, Burlington Insurance Co. insured Breaking Solutions.  The NYCTA and MTA were additional insureds under the policy. It was NYCTA’s responsibility to identify the location of electric cables and to shut off the power in the areas where Breaking Solutions was working. NYCTA failed to identify and shut off the power to a cable which was struck by Breaking Solutions’ excavation equipment resulting in an explosion. The plaintiff in the underlying personal injury action, an NYCTA employee, was injured by the explosion. The issue came down to the language of the “additional insureds” endorsement which referred only to injuries “caused” by the acts or omissions of the insured. Even though the probable intent of the drafters of the policy was to cover only “negligent” acts or omissions by the insured which “caused” the injury, the language of the endorsement could only be enforced as written. Because the worker’s injuries were “caused” by the (non-negligent) acts of the insured, the additional insureds (NYCTA and MTA) were covered under the terms of the policy:

While it is true that, because NYCTA had not warned the Breaking Solutions’ operator of the cable’s presence, Breaking Solutions’ “act[]” did not constitute negligence, this does not change the fact that the act of triggering the explosion, faultless though it was on Breaking Solutions’ part, was a cause of [the worker’s] injury. The language of the relevant endorsement, on its face, defines the additional insured coverage afforded in terms of whether the loss was “caused by” the named insured’s “acts or omissions,” without regard to whether those “acts or omissions” constituted negligence or were otherwise actionable. Burlington Ins. Co. v NYC Tr. Auth., 2015 NY Slip Op 06481, 1st Dept 8-11-15

 

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Department of Motor Vehicles Did Not Exceed Its Powers In Promulgating Regulations Re: Lifetime Revocation of Driver’s Licenses, Five-Year Stay of Relicensure, and Subsequent Five-Year Restricted License/Ignition Interlock Period for Alcohol-Related Convictions

The Third Department, in a full-fledged opinion by Justice Peters, over a two-justice dissent, determined that petitioner’s challenges to Department of Motor Vehicles’ (DMV’S) regulations re: (1) the lifetime revocation of a driver’s license for alcohol-related convictions, (2) the five-year stay of relicensure for persons with three alcohol-related convictions, and (3) the subsequent five-year period with the imposition of a restricted license and installation of ignition interlock device, were properly dismissed as nonjusticiable (petitioner not yet affected by any of them). The court went on to determine the DMV, by promulgating these regulations, did not encroach upon the powers of the legislature. The dissenters argued that some of the challenges were justiciable and the DMV in fact exceeded its powers by mandating a five-year stay of relicensure for anyone with three alcohol-related convictions within a 25-year lookback, as well as the subsequent five-year period allowing only a restricted license with the installation of an ignition interlock device. The majority explained the general principles for analyzing whether an agency has exceeded its powers:

To determine whether an administrative agency has usurped the power of the Legislature, courts must consider whether the agency: (1) “operat[ed] outside of its proper sphere of authority” by balancing competing social concerns in reliance “solely on [its] own ideas of sound public policy”; (2) engaged in typical, “interstitial” rulemaking or “wrote on a clean slate, creating its own comprehensive set of rules without the benefit of legislative guidance”; (3) “acted in an area in which the Legislature has repeatedly tried — and failed — to reach agreement in the face of substantial public debate and vigorous lobbying by a variety of interested factions”; and (4) applied its “special expertise or technical competence” to develop the challenged regulations (Boreali v Axelrod, 71 NY2d at 12-14 …).  Matter of Acevedo v New York State Dept. of Motor Vehs., 2015 NY Slip Op 06467, 3rd Dept 8-6-15

 

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Petitioner-Teacher Never Consented to an “Out of Area” Assignment—Therefore She Was Entitled to Seniority in Her Teaching Area, Despite Her Assignment to Another Area

The Third Department determined Supreme Court correctly annulled the commissioner’s determination terminating petitioner’s employment on the ground that her position was properly eliminated because she had the least seniority. Although petitioner was in the English tenure area, she was assigned to teach computer classes, which she had taught for 11 years. The commissioner determined she had acquired no seniority because she had not taught in her tenure area.  However, the relevant regulations require that a teacher consent to an “out of area” assignment. Because petitioner never consented to an “out of area” assignment, she was entitled to seniority in her English tenure area, despite the fact she was assigned to teach computer classes.  The Third Department noted that the Commissioner’s ruling constituted an artificial or forced construction of the applicable regulations:

Petitioner acknowledges that, although the Board awarded her tenure in the English 7-12 tenure area, she never spent 40% or more of her time teaching English classes. She contends, however, that her seniority is preserved by another provision of the Rules, which states that “[n]o professional educator, whether on tenure or in probationary status, may be assigned to devote a substantial portion of his [or her] time in a tenure area other than that in which he [or she] has acquired tenure or is in probationary status, without his [or her] prior written consent” (8 NYCRR 30-1.9 [c]).

Our review of the evidence reveals that petitioner was a professional educator (see 8 NYCRR 30-1.1 [e]) who was assigned exclusively to teach computer classes, which the Board admits was an assignment outside of her probationary and acquired English 7-12 tenure area. The record is devoid of evidence that petitioner was aware that she was given an out-of-area assignment or that she consented to it in writing. * * * Nowhere in the language of 8 NYCRR 30-1.9 (c) is there a requirement that professional educators must first spend some of their time teaching within their probationary or acquired tenure areas before earning the right to consent to an out-of-area assignment. Inasmuch as the Commissioner’s interpretation reads this nonexistent requirement into the provision, we view it as “an artificial or forced construction” (McKinney’s Cons Laws of NY, Book 1, Statutes § 94).

The Commissioner’s interpretation also runs contrary to the underlying purposes of the Rules governing teacher tenure and seniority credit. As the Court of Appeals has noted, 8 NYCRR former 30.9 (b) (now 8 NYCRR 30-1.9 [c]) “protects teachers from being deprived of credit in a previously appointed tenure area if they unwittingly accept, and serve in, out-of-area assignments” … . The “twofold protective purpose” of 8 NYCRR 30-1.9 (c) — that is, to protect teachers from unknowing, involuntary out-of-area assignments and allow for the accrual of seniority credit in their original tenure area if they should accept such an assignment — is not served if the provision is construed in such a way as “to block a teacher from receiving seniority credit which, absent school district error, would have been received by reason of actual service in an out-of-tenure area”… . Because the Commissioner’s interpretation of 8 NYCRR 30-1.9 (c) has precisely this effect on petitioner, we find that Supreme Court properly annulled the Commissioner’s confirmation of petitioner’s termination. Matter of Cronk v King, 2015 NY Slip Op 06396, 3rd Dept 7-30-15

 

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Agency’s Failure to Follow Its Own Regulations Renders Determination Arbitrary and Capricious

The Second Department, over a partial dissent, in a rent-overcharge proceeding, affirmed Supreme Court’s review of the propriety of rent regulated by the NYC Rent Stabilization Code. The court explained the extent of the courts’ review powers of the administrative rulings, noting that the Deputy Commissioner’s failure to calculate the appropriate rent in the manner dictated by the controlling regulations rendered that particular aspect of the Commissioner’s ruling arbitrary and capricious:

“[I]n a CPLR article 78 proceeding to review a determination of the DHCR [NYC Department of Housing and Community Renewal], the court is limited to . . . the question of whether its determination was arbitrary and capricious and without a rational basis” … . In reviewing a determination of the DHCR, “[t]he court may not substitute its judgment for that of the DHCR” … . “The DHCR’s interpretation of the statutes and regulations it administers, if reasonable, must be upheld” … . * * *

In determining that the [landlord was] entitled to a rental increase of $204.01 per month pursuant to Rent Stabilization Code (9 NYCRR) § 2522.4(a)(1), the Deputy Commissioner deviated from the statutory calculations set forth in Rent Stabilization Code (9 NYCRR) § 2522.4(a)(4). Accordingly, the determination to recalculate the legal regulated rent to be $1,200 per month, by including a rental increase of $204.01 per month, was arbitrary and capricious and did not have a rational basis in the record … . Matter of Velasquez v New York State Div. of Hous. & Community Renewal, 2015 NY Slip Op 06353, 2nd Dept 7-29-15

 

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Court’s Review Powers Re: a Planning Board’s Denial of a Subdivision Application Explained

In upholding the Planning Board’s denial of petitioner’s subdivision application, the Second Department explained the court’s review criteria in this context: “The court will substitute its judgment for that of a planning board only when the determination was affected by an error of law, or was arbitrary and capricious or an abuse of discretion, or was irrational (… see CPLR 7803[3]…). When reviewing a planning board’s determination, courts consider substantial evidence only to determine whether the record contains sufficient evidence to support the rationality of the Board’s determination…”. [internal quotation marks omitted] The Second Department went on to look at the evidence, which, although conflicting in some aspects, included support for the rationality of the Planning Board’s ruling. Matter of Ostojic v Gee, 2015 NY Slip Op 06244, 2nd Dept 7-22-15

 

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Conversion of Water to Steam and Steam to Water Did Not Constitute a Manufacturing Process—Therefore Petitioner Was Not Entitled to Manufacturing Tax Credits in Connection with the Operation of Its “Boiling Water” Nuclear Power Facilities—The Certification Prerequisite for Pollution Tax Credits Is Not Preempted by Federal Law which Regulates the Construction and Operation of Nuclear Power Facilities

The Third Department, in a full-fledged opinion by Justice Garry, determined that petitioner, the owner of two nuclear power plants, was not entitled to manufacturing tax credits or pollution tax credits under the Tax Law. The production of electricity is specifically excluded from the range of “manufacturing” for which manufacturing credits are available. The petitioner argued that the water which is turned into steam and then back into water (to operate the turbines) constituted a manufacturing process within the meaning of the Tax Law. The Third Department disagreed, describing the process as recycling, not manufacturing. The pollution tax credits are available only to facilities certified by the Department of Environmental Conservation as compliant with state environmental, public health and sanitary rules. Petitioner’s facilities were not so certified. The Third Department determined that the state certification requirement was not preempted by federal law, which exclusively regulates the construction and operation of nuclear power facilities, because tax credits do not regulate the construction or operation of such facilities. Petitioner was not, therefore, entitled to pollution tax credits. With regard to the manufacturing tax credits, the court explained:

Manufacturing is defined as “the process of working raw materials into wares suitable for use or which gives new shapes, new quality or new combinations to matter which already has gone through some artificial process by the use of machinery . . . and other similar equipment” (Tax Law former § 210 [12] [b] [ii] [A]), and “‘processing’ speaks to an industrial activity related to manufacturing” … . Here, the water that is converted to steam by petitioner’s assets is then converted back to its original form as water and then to steam again in an ongoing, continuous cycle that makes no permanent change in the water and yields no final product. This is more akin to recycling than to manufacturing. On these facts, we cannot find it irrational for the Tribunal to conclude that the claimed assets were not principally engaged in producing any tangible property other than electricity … . Petitioner has neither established that its interpretation of the governing statute is the only reasonable construction nor that the Tribunal’s interpretation was “irrational or unreasonable”…  and, thus, has not shown that the Tribunal’s determination that it is ineligible for the manufacturing tax credits should be reversed.  Matter of Constellation Nuclear Power Plants LLC v Tax Appeals Trib. of the State of N.Y., 2015 NY Slip Op 06183, 3rd Dept 7-16-15

 

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Failure to Strictly Comply with the Procedure Mandated by the State Environmental Quality Review Act (SEQRA) Required Annulment of the Town’s Negative Declaration Re: the Construction of a Casino and Resort

The Fourth Department, with two concurring and one dissenting justice, determined that the town’s negative declaration under the State Environmental Quality Review Act (SEQRA) with respect to the construction of a casino and resort should have been annulled because the town did not strictly comply with mandated procedure. Specifically the negative declaration did not include a “reasoned elaboration” as required by the relevant regulation. A document prepared by the town’s counsel explaining the reasons for the negative declaration was never approved or adopted by the town board and therefore did not meet the statutory/regulatory “reasoned elaboration” requirement:

It is well settled that SEQRA’s procedural mechanisms mandate strict compliance, and anything less will result in annulment of the lead agency’s determination of significance … . “[L]iteral rather than substantial compliance with SEQRA is required” … . Here, 6 NYCRR 617.7 (b) (4) requires that, in making the determination of significance, the lead agency—in this case the Town Board—must “set forth its determination of significance in a written form containing a reasoned elaboration and providing reference to any supporting documentation.” We conclude that the intent of the regulation is to focus and facilitate judicial review and, of no lesser importance, to provide affected landowners and residents with a clear, written explanation of the lead agency’s reasoning at the time the negative declaration is made. We reject respondents’ contention that we should search the entire record to discern the Town Board’s reasoning as of June 12, 2014 in making the determination to issue the negative declaration. “A record evincing an extensive legislative process . . . is neither a substitute for strict compliance with SEQRA’s [written] reasoned elaboration requirement nor sufficient to prevent annulment” … . We therefore reverse the judgment and grant the petition, thereby annulling the negative declaration and vacating the site plan approval and all related resolutions. Matter of Dawley v Whitetail 414, LLC, 2015 NY Slip Op 06082 4th Dept 7-10-15

 

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