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Plaintiff’s Age-Discrimination Lawsuit Properly Survived Summary Judgment

The First Department, over an extensive dissent, determined defendant’s motion for summary judgment in an age-discrimination suit was properly denied. Plaintiff alleged she was terminated because of her age and was able to raise a question of fact about whether the reasons for termination proffered by the defendant were pretextual. The core of plaintiff’s allegations were remarks made by the person who replaced plaintiff as executive director of defendant-club—remarks noting plaintiff looked “tired” and perhaps needed to “rest” or questions whether plaintiff was “up for” meetings or whether a meeting might be “too much for” her:

…[W]e find that when plaintiff’s testimony is credited for purposes of this motion, these remarks directly reflect age-based discriminatory bias  …, and raise an inference of age-related bias sufficient to make out plaintiff’s prima facie case of employment discrimination … . In concluding that no inference of discriminatory motive can be drawn from this evidence, the dissent fails to abide by the precept that “all of the evidence must be viewed in the light most favorable to the party opposing the motion, and all reasonable inferences must be resolved in that party’s favor” … .

Plaintiff has … met her burden of showing pretext by “respond[ing] with some evidence that at least one of the reasons proffered by defendant is false, misleading, or incomplete” … . Rollins v Fencers Club, Inc., 2015 NY Slip Op 03769, 1st Dept 5-7-15

 

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Although Picketing by Teachers Was Protected Speech, the Manner in which the Picketing Was Carried Out Endangered the Safety of Students—Therefore the Teachers Were Properly Disciplined

The Court of Appeals, in a full-fledged opinion by Judge Abdus-Salaam, with concurring and dissenting opinions, reversed the Appellate Division and found that teachers had been properly disciplined for picketing in their cars in a manner which made it more difficult for parents to drop off their children at the school.  The court applied the so-called Pickering test (Pickering v Board of Educ…391 US 563 [1968]) which addresses the free speech rights of public employees (which are somewhat curtailed).  Under the court's Pickering analysis, the picketing was protected speech, but the manner in which the picketing was done endangered the students. The teachers, therefore, could be disciplined for the manner in which they exercised their right to free speech:

Under Pickering, the determination whether a public employer has properly disciplined a public employee “for engaging in speech requires 'a balance between the interests of the [employee], as a citizen, in commenting upon matters of public concern and the interest of the [public] . . . employer, in promoting the efficiency of the public services it performs through its employees'” … . This balancing test recognizes that the public employer must be permitted a level of control over its employees so it may fulfill essential services, such as public safety and education, efficiently and effectively …, but also that “[v]igilance is necessary” to ensure public employers do not use their authority “to silence discourse[] not because it hampers public functions but simply because superiors disagree with the content of [the] employees' speech” … . Matter of Santer v Board of Educ of E Meadow Union Free Sch Dist, 2014 NY Slip Op 03189, CtApp 5-6-14

 

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Comptroller Has Authority to Audit Private Health Care Providers Who Are Paid through an Insurance Company Under Contract with the State for Health Care Provided to State Employees

The Court of Appeals, in a full-fledged opinion by Judge Rivera, determined the state comptroller had constitutional and statutory authority to audit the billing records of private health care providers (Handler and South) who receive state funds for care provided to state employees through an insurance company under contract with the state. The underlying audit concerned the health care providers' waiver of patients' co-payments which effectively reduced the cost of the care provided by 20%.  Because the state was obligated to pay only 80% of the cost of the care, the comptroller determined the health care providers who waived the copayment were effectively overpaid by the state.  The health care providers argued the comptroller did not have the power to audit them because they were paid by the insurance company, not the state:

Handler and South Island receive State insurance funds in exchange for services rendered to State insurance beneficiaries. The fact that the State relies on a third-party conduit, United [the insurance company], does not change the character of the funds. They remain State dollars directed to pay health care costs incurred by State beneficiaries and charged by Handler and South Island.  Matter of Martin H Handler MD PC v DiNapoli, 2014 NY Slip Op 03191, CtApp 5-6-14

 

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Questions of Fact Whether Hospital Liable for Independent Actions of Its Employees Under Respondeat Superior and Negligent Hiring/Retention Theories

In finding that the hospital’s motion for summary judgment in a medical malpractice case was properly denied, the Second Department explained that the hospital can be liable for the independent actions of its own employees, despite the involvement of a non-employee attending physician, under the doctrine of respondeat superior, as well as under a negligent hiring/retention theory.  The court explained the relevant law:

In general, under the doctrine of respondeat superior, a hospital may be held vicariously liable for the negligence or malpractice of its employees acting within the scope of employment, but not for negligent treatment provided by an independent physician, as when the physician is retained by the patient himself … . Thus, “a hospital may not be held liable for injuries suffered by a patient who is under the care of a private attending physician chosen by the patient where the resident physicians and nurses employed by the hospital merely carry out the orders of the private attending physician, unless the hospital staff commits independent acts of negligence or the attending physician’s orders are contraindicated by normal practice” … . A hospital may also be liable on a negligent hiring and/or retention theory to the extent that its employee committed an independent act of negligence outside the scope of employment, where the hospital was aware of, or reasonably should have foreseen, the employee’s propensity to commit such an act… .  Seiden v Sonstein, 2015 NY Slip Op 03517, Second Dept 4-29-15

 

 

 

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“Head Waiter” with Substantial Managerial Duties and “Wine Steward” Whose Duties Did Not Include Serving Customers Were Not Entitled to Share in the Servers’ and Bus Boys’ Tip Pool

The Third Department affirmed the NYS Industrial Board of Appeals’ determination that two senior restaurant employees were not entitled to share in the servers’ and bus boys’ tip pool based upon the nature of their duties—one, the “head waiter,” had substantial managerial duties, and the other, the “wine steward,” had computer-programming duties, assisted customers with the wine list, and had little to do with serving customers.  Labor Law 196-d, as interpreted by the Court of Appeals, looks at the actual duties of employees, as opposed to their titles.  Those who exercise substantial managerial responsibilities, and those who cannot be characterized as “food service workers,” cannot participate in the tip pool:

The governing statute, Labor Law § 196-d, provides that “[n]o employer or his [or her] agent . . . shall demand or accept, directly or indirectly, any part of the gratuities, received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity for an employee. . . . Nothing in this subdivision shall be construed as affecting . . . the sharing of tips by a waiter with a busboy or similar employee.” Recently, the Court of Appeals clarified that eligibility to participate in a tip pool “‘shall be based upon duties and not titles'” (Barenboim v Starbucks Corp., 21 NY3d 460, 471 [2013], quoting 12 NYCRR 146-2.14 [e]), and the Court held that “employer-mandated tip splitting should be limited to employees who, like waiters and busboys, are ordinarily engaged in personal customer service, a rule that comports with the ‘expectation[s] of the reasonable customer'” (Barenboim v Starbucks Corp., 21 NY3d at 471-472, quoting Samiento v World Yacht Inc., 10 NY3d 70, 79 [2008]; see 12 NYCRR 146-2.16 [b]; 146-3.4 [a]). Consistent with longstanding DOL policy, the Court further observed that “employees who regularly provide direct service to patrons remain tip-pool eligible even if they exercise a limited degree of supervisory responsibility” (Barenboim v Starbucks Corp., 21 NY3d at 472). The Court concluded, however, “that there comes a point at which the degree of managerial responsibility becomes so substantial that the individual can no longer fairly be characterized as an employee similar to general wait staff within the meaning of Labor Law § 196-d” (id. at 473). The Court determined that “the line should be drawn at meaningful or significant authority or control over subordinates” (id.). The Court explained that “[m]eaningful authority might include the ability to discipline subordinates, assist in performance evaluations or participate in the process of hiring or terminating employees, as well as having input in the creation of employee work schedules, thereby directly influencing the number and timing of hours worked by staff as well as their compensation” (id.). Matter of Marzovilla v New York State Indus. Bd. of Appeals, 2015 NY Slip Op 03219, 3rd Dept 4-16-15

 

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Although the Doctor Was Employed by the Hospital, His Employment Did Not Encompass His Medical Practice—Therefore the Hospital Was Not Liable for the Doctor’s Medical Malpractice Under the Doctrine of Respondeat Superior/$6.8 Million Verdict Against the Doctors Based Upon a Delay in Diagnosing Cancer Should Not Have Been Set Aside

The Second Department determined Supreme Court properly dismissed the complaint against the hospital in a medical malpractice case, but improperly set aside the $6.8 million verdict against the doctors.  Plaintiff alleged the doctors caused a 13-month delay in the diagnosis of cancer, which required her to have extensive surgery and reduced her chance of survival.  The suit against the hospital was based upon respondeat superior. However the employment contract between the doctor, Aloia, and the hospital related to duties other than Aloia’s treatment of patients.  Therefore the complaint against the hospital was properly dismissed after trial pursuant to CPLR 4401. The Second Department determined there was sufficient evidence to support plaintiff’s allegations and, therefore, the verdict against the doctors should stand.  “…[T]here was a valid line of reasoning and permissible inferences from which the jury could have rationally concluded that the physician defendants departed from good and accepted medical practice, and that the delay in diagnosing the injured plaintiff’s cancer proximately caused her to have a worsened prognosis or decreased 10-year survival rate:”

To be awarded judgment as a matter of law pursuant to CPLR 4401, a defendant must show that, upon viewing the evidence in the light most favorable to the plaintiff, there is no rational basis by which the jury could find for the plaintiff against the moving defendant” … . “The doctrine of respondeat superior renders an employer vicariously liable for a tort committed by an employee while acting within the scope of employment. The general rule is that an employee acts within the scope of his employment when he is acting in furtherance of the duties owed to the employer and where the employer is or could be exercising some degree of control, directly or indirectly, over the employee’s activities” … . Although the issue is usually a factual issue for the jury, “[w]here the proof on the issue of control presents no conflict in evidence or is undisputed, the matter may properly be determined as a matter of law” … .

Here, there was no real dispute as to the employment arrangement between Aloia and [the hospital] as set forth in the clear and unambiguous employment contract … . Aloia’s employment contract permitted him to maintain his private practice in endocrinology, as well as internal medicine and bone densitometry, outside of his employment with [the hospital]. * * *

“A motion for judgment as a matter of law pursuant to CPLR . . . 4404 may be granted only when the trial court determines that, upon the evidence presented, there is no valid line of reasoning and permissible inferences which could possibly lead rational persons to the conclusion reached by the jury upon the evidence presented at trial, and no rational process by which the jury could find in favor of the nonmoving party” … . “In considering such a motion, the trial court must afford the party opposing the motion every inference which may properly be drawn from the facts presented, and the facts must be considered in a light most favorable to the nonmovant'” … . Luna v Spadafora, 2015 NY Slip Op 03134, 2nd Dept 4-15-15

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Criteria for Respondeat Superior (Scope of Employment) Liability Succinctly Explained

The Second Department determined summary judgment was properly denied to the defendant employer.  The employee was test driving a competitor’s car in connection with his job at a Mercedes dealership when the employee was involved in an accident.  The Second Department determined the employer failed to demonstrate the employee was not acting within the scope of his employment at the time of the accident.  The court explained the relevant law:

Under the doctrine of respondeat superior, an employer can be held vicariously liable for the torts committed by an employee acting within the scope of the employment” … . “An act is considered to be within the scope of employment if it is performed while the employee is engaged generally in the business of his [or her] employer, or if his [or her] act may be reasonably said to be necessary or incidental to such employment” … . “An employer, however, cannot be held vicariously liable for its employee’s alleged tortious conduct if the employee was acting solely for personal motives unrelated to the furtherance of the employer’s business at the time of the incident … . Zwibel v Midway Automotive Group, 2015 NY Slip Op 03154, 2nd Dept 4-15-15

 

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Where It Was Not Clear that Grand Jury Proceedings in Which a County Employee Was Directed to Appear Involved a Criminal Matter, as Opposed to Civil Misconduct or Neglect, the County Was Required to Pay for the Employee’s Defense Pursuant to Public Officers Law Section 18

The Third Department affirmed Supreme Court’s ruling that petitioner, a county employee, was entitled to attorney’s fees pursuant to Public Officers Law section 18 in connection his appearances in grand jury proceedings.  The county argued that the statute only requires payment for the defense of an employee “in [a] civil action or proceeding” and a grand jury proceeding is criminal in nature.  The Third Department noted that the district attorney would not divulge the nature of the grand jury proceedings and grand juries can be convened to consider noncriminal misconduct or neglect by public employees.  Therefore the employee was entitled to attorney’s fees for his defense:

Respondent failed to demonstrate what the object of the grand jury proceeding was, readily admitting that the District Attorney had not made his “intentions [known] in relation to the potential for criminal charges.” While grand juries may indict a person for a criminal offense (see CPL 1.20 [18]; 190.60 [1]), they are also empowered “to make presentments as to noncriminal misconduct or neglect by public officers and employees” … . Thus, because there is no indication that criminal charges are [*3]actually being contemplated, Supreme Court properly “reject[ed] respondent’s claim that because the [g]rand [j]ury proceeding[s] could have resulted in criminal charges against petitioner, the proceeding[s] [were] not civil in nature” … . “Any other holding would defeat the clear intent of the statute, which insulates public employees from litigation expenses arising out of their employment” … . Matter of Mossman v County of Columbia, 2015 NY Slip Op 03005, 3rd Dept 4-9-15

 

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Subcontractor Could Not Recover From Property Owners Absent Proof the Owners Consented to Pay the Subcontractor—Owners Hired the General Contractor Who In Turn Hired the Subcontractor

The Second Department determined the property owners were not liable in quasi contract to a subcontractor. The property owners demonstrated the subcontractor was not working for them, but rather worked for the general contractor hired by the owners. The mere fact that the owners consented to the work done by the subcontractor, and were benefitted by it, is not enough to demonstrate unjust enrichment. The subcontractor must show the owners consented to pay the subcontractor for the work:

“[A] property owner who contracts with a general contractor does not become liable to a subcontractor on a quasi contract theory unless it expressly consents to pay for the subcontractor’s performance” … . “The mere fact that the [owners] consented to the improvements and received some benefit from the [subcontractor’s] activities is insufficient to recover on such a theory; the [subcontractor] must also show that it was working for the [owners] when it performed its work resulting in unjust enrichment” … . Sears Ready Mix, Ltd. v Lighthouse Mar., Inc., 2015 NY Slip Op 02955, 2nd Dept 4-8-15

 

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Allegations of Abuse of a Student by a School Bus Monitor Raised Questions of Fact Re: Negligent Supervision of the Student, Negligent Supervision and Training of the Monitor, and Whether the Monitor Was Acting Within the Scope of Her Employment

The Second Department, reversing Supreme Court, determined the defendant school district’s motion for summary judgment should not have been granted.  The complaint alleged a school bus monitor physically and mentally abused plaintiffs’ son, a student with severe mental disabilities.  The court determined the school did not establish it was unaware of the monitor’s propensity for the alleged misconduct (there was evidence of prior complaints). For that reason, the causes of action for negligent supervision of plaintiffs’ son and negligent supervision and training of the monitor should not have been dismissed. The court further determined the school did not demonstrate the actions taken by the monitor were within the scope of her employment, so the cause of action for negligent supervision and training of the monitor was viable.  The court noted that a negligent supervision and training cause of action would be precluded if the employee were shown to have acted within the scope of her employment, but suit under a “respondeat superior” theory would be possible:

Schools have a duty to adequately supervise the students in their care, and may be held liable for foreseeable injuries proximately related to the absence of adequate supervision … . The standard for determining whether the school has breached its duty is to compare the school’s supervision and protection to that of a parent of ordinary prudence placed in the same situation and armed with the same information … . Where the complaint alleges negligent supervision due to injuries related to an individual’s intentional acts, the plaintiff generally must demonstrate that the school knew or should have known of the individual’s propensity to engage in such conduct, such that the individual’s acts could be anticipated or were foreseeable … .

Contrary to the Supreme Court’s determination, the school defendants failed to establish, prima facie, that the school district had no specific knowledge or notice of [the monitor’s] propensity to engage in the misconduct alleged. ***

For the same reason, the Supreme Court erred in directing the dismissal of the plaintiffs’ second cause of action insofar as it alleged negligent supervision and training of [the monitor]. A necessary element of such causes of action is that the employer knew or should have known of the employee’s propensity for the conduct which caused the injury … . * * *

“Generally, where an employee is acting within the scope of his or her employment, the employer is liable for the employee’s negligence under a theory of respondeat superior and no claim may proceed against the employer for negligent hiring, retention, supervision or training”.  … [T]he school defendants did not establish, prima facie, that [the monitor] was acting within the scope of her employment during the alleged incidents. Consequently, the plaintiffs were not precluded from claiming that the school district was negligent in its supervision and training of [the monitor]. Timothy Mc. v Beacon City School Dist., 2015 NY Slip Op 02942, 2nd Dept 4-8-15

 

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