You are here: / Third Department

Tag Archive for: Third Department

, ,

Note Which Was Extended and Consolidated with Other Debts Was Not Extinguished by the Consolidation, Extension and Modification Agreement (CEMA)—the Agreement, Therefore, Did Not Commence the Running of the Statute of Limitations for an Action on the Note

The Third Department, reversing Supreme Court, determined a Consolidation, Extension and Modification Agreement (CEMA) did not extinguish a note which was extended and consolidated under the agreement. Therefore the statute of limitations for action on the note did not commence running when the agreement was entered:

We agree with plaintiff that the plain language of the CEMA does not support Supreme Court’s conclusion that the CEMA extinguished the 1992 note and thereby recommenced the running of the statute of limitations. “It is well established that a subsequent note does not discharge the original indebtedness secured unless there is an express agreement between the parties” … . Defendant points to no express agreement and cites no authority supporting its claim that the CEMA operated to extinguish the 1992 note. Rather, the record makes clear that defendant still owed approximately $169,000 on the 1992 note at the time that the CEMA was executed. That debt was consolidated with two other debts into a new note and the mortgage liens were “coordinated, consolidated, combined and extended” to form a single lien. “Where, as here, balances of first mortgage loans are increased with second mortgage loans and CEMAs are executed to consolidate the mortgages into single liens, the first notes and mortgages still exist” … . Bechard v Monty’s Bay Recreation, Inc., 2015 NY Slip Op 04711, 3rd Dept 6-4-15

 

,

Agency’s Failure to Follows Its Own Regulations Rendered Determination Arbitrary and Capricious

The Third Department determined that the NYS Education Department did not follow its own regulations in calculating the amounts due petitioner for special education services for preschool children with disabilities.  Failure to follow the regulations rendered the calculation “arbitrary and capricious:”

Petitioner contends that respondent failed to follow its own regulations and otherwise acted arbitrarily primarily by relying upon unaudited information from the municipalities, disregarding petitioner’s audited CFR [Consolidated Fiscal Report] and financial data, and refusing to consider petitioner’s explanation for the discrepancies between its audited information and the municipalities’ data. Our review of an administrative agency’s determination is limited to “ascertain[ing] whether there is a rational basis for the action in question or whether it is arbitrary and capricious” …, and we have previously recognized that respondent has “broad discretion in setting the reconciliation rate” … . However, an agency determination arrived at in a manner inconsistent with its own regulations is not supported by a rational basis … . Although “an agency’s interpretation of its own regulation is entitled to deference” … , “courts are not required to embrace a regulatory construction that conflicts with the plain meaning of the promulgated language” … . * * *

The intent of the regulations, consistent with common sense and good government, is to gather and use correct data; hence, the repeated directives that service providers submit information — CFRs and financial statements — that has been independently audited and certified by an appropriate professional (see 8 NYCRR 200.9 [e] [1] [i] [a] [1]; [ii] [a]). The regulations provide no authority for relying solely on unaudited information from municipalities. This does not lead to the conclusion that such information from a municipality has no role. It can be considered to require clarification or explanation from a service provider and, if adequately verified, even incorporated in the calculus. However, at a minimum, a service provider that has adhered to the regulations and provided a CFR and financial statement, both audited, should be afforded a reasonable opportunity to explain and/or reconcile its information with the unaudited information of a municipality. Consistent with its own regulations, respondent cannot simply reject audited information by reason of the existence of less reliable information without some articulable rational basis. Matter of Mid Is. Therapy Assoc., LLC v New York State Educ. Dept., 2015 NY Slip Op 04707, 3rd Dept 6-4-15

 

Untimely Initial Appearance Does Not Mandate Dismissal as Long as the Right to a Speedy Fact-Finding Hearing Is Not Violated

The Third Department determined the failure to conduct an initial appearance within ten days of the filing of the juvenile delinquency petition (charging the equivalent of assault and criminal possession of a weapon) did not require dismissal of the petition. The court attempted to conduct the initial appearance within ten days but respondent failed to appear and no timeliness objection was raised when the initial appearance was conducted five days later.  The Third Department explained that the ten-day requirement is flexible, but the requirement that a fact-finding hearing be conducted within 60 days of the initial appearance is mandatory:

Respondent first contends that dismissal of the June 2013 petition is required because Family Court failed to conduct a timely initial appearance. Because he was not detained, Family Ct Act § 320.2 (1) required that the initial appearance occur “as soon as practicable and, absent good cause shown, within [10] days after” the filing of the petition. The initial appearance, “like the arraignment of an adult charged with a crime, is the process by which the court obtains jurisdiction over the minor, determines if detention is warranted, and sets the dates for further proceedings” (… see Family Ct Act § 320.4). Dismissal is appropriate where a respondent is deprived of his or her right to a speedy fact-finding hearing, a hearing that must occur “not more than [60] days after the conclusion of the initial appearance” if he or she is not confined (Family Ct Act § 340.1 [2]; see Family Ct Act §§ 310.2, 332.1 [8]). A “similar protected status” is not afforded to the initial appearance itself, although “dismissal without prejudice may be an appropriate remedy” if it is not held in a timely manner … . To put it succinctly, dismissal is not mandated in the wake of an untimely initial appearance so long as respondent’s right to a speedy fact-finding hearing is not violated … . Matter of Daniel B., 2015 NY Slip Op 04698, 3rd Dept 6-4-15

 

,

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

 

Good, Fact-Based Analysis of the Requirements for Adverse Possession

Reversing Supreme Court’s grant of summary judgment to the plaintiffs on their adverse-possession claim, the Third Department determined a question of fact had been raised about whether plaintiffs’ use of the disputed land was with the defendants’ permission, which would defeat the “hostility” element of adverse possession.  The Third Department offered a detailed fact-based analysis which provides an excellent lesson on the law of adverse possession. The court noted, on the issue of exclusivity, the claim that defendants occasionally maintained the disputed property during the plaintiffs’ absence was not enough to raise a question of fact about the plaintiffs’ exclusive use of the property:

To establish their claim for adverse possession, plaintiffs are required to prove by clear and convincing evidence that their possession of the disputed property “[was] hostile and under a claim of right, actual, open and notorious, exclusive and continuous for the statutory period of 10 years” … . Additionally, where, as here, the adverse possession claim is not based upon a written instrument, the party asserting the claim “must establish that the land was ‘usually cultivated or improved’ or ‘protected by a substantial inclosure'” … .

As for [defendant’s] alleged maintenance of the disputed property during plaintiffs’ absences, “exclusivity is not defeated even if the true owner makes occasional forays onto the property . . .. [A]ll that is required is possession consistent with the nature of the property so as to indicate exclusive ownership” (1-5 Warren’s Weed, New York Real Property § 5.33 [2015]). In our view, plaintiffs’ exclusive, regular use and maintenance of the disputed property during their periods of occupation were consistent with the seasonal nature of their property. The occasional maintenance that defendants allegedly performed or directed during plaintiffs’ absences — which was performed without plaintiffs’ knowledge and did not interfere in any way with plaintiffs’ possession or use of the disputed property — was insufficient to meet defendants’ prima facie burden to establish that plaintiffs’ use of the property was not exclusive … . Bergmann v Spallane, 2015 NY Slip Op 04713, 3rd Dept 6-4-15

 

, , ,

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

 

Individuals with Disabilities Education Act (IDEA) Does Not Confer a Private Right of Action Upon Local School Districts to Challenge IDEA-Related Rulings by the State Education Department (SED)

The Third Department, in a full-fledged opinion by Justice Peters, determined the Individuals with Disabilities Education Act (IDEA) did not give local educational agencies (LEA’s) (here a local school district) a private right of action to challenge a ruling by the State Education Department (SED) .  Here the SED found that the LEA’s dispute resolution practices violated state laws and regulations promulgated in accordance with the IDEA and ordered corrective measures. The LEA then challenged the SED’s rulings in an Article 78 action. The Third Department noted that the IDEA does not expressly confer a right of private action on LEA’s in this context and therefore whether such a right exists depends upon congressional intent. Because the IDEA confers a private right of action upon a specialized class, i.e., “any party aggrieved” by IDEA-related administrative proceedings which involve due process afforded a particular child, it follows that Congress did not intend to confer such a right upon LEA’s:

… Congress created procedural safeguards to ensure that students with disabilities receive a free appropriate public education and, in doing so, expressly granted a private right of action to “any party aggrieved” by an SEA’s administrative findings or decision resolving a due process complaint challenging “any matter relating to the identification, evaluation or educational placement of [a particular] child, or the provision of a free appropriate public education to such child” (20 USC § 1415 [b] [6] [A]; [f], [g], [i] [2] [A]; see also Education Law § 4404; 8 NYCRR 200.5 [i], [j], [k], [l])[FN2]. Since the IDEA includes an express right of action in favor of a specific class of persons, it is logical to assume that, had Congress intended to bestow upon LEAs a right of action to challenge an SEA’s regulatory and enforcement actions, it would have expressly done so … .

Further evidence of a lack of Congressional intent can be found in the hierarchal regulatory and enforcement structure created by the IDEA, which requires the federal Secretary of Education to monitor the states’ implementation of IDEA mandates and imposes upon the states corresponding regulatory and enforcement responsibilities over LEAs (see 20 USC § 1412 [a] [11]; § 1416 [a] [3]; 34 CFR 300.600, 300.603). The delegation of regulatory and enforcement power to the Secretary of Education and the states, but not to LEAs, suggests that Congress specifically intended to deny LEAs a right of action to challenge an SEA’s compliance with the IDEA … . Moreover, it would be inconsistent for Congress to implicitly create this right of action, as doing so would divest the Secretary of Education and the states of their regulatory and enforcement authority and would transfer that power to the Judiciary … . Matter of East Ramapo Cent. Sch. Dist. v King, 2015 NY Slip Op 04703, 3rd Dept 6-4-15

 

,

Election Poll Worker Not an Employee—Not Entitled to Unemployment Insurance Benefits

The Third Department determined an election poll worker was not an employee entitled to unemployment insurance benefits:

“An employer-employee relationship exists when the evidence shows that the employer exercises control over the results produced or the means used to achieve the results [although] control over the means [used to achieve those results] is the more important factor to be considered” … .

Here, claimant testified that she responded affirmatively to a card received in the mail from the Board of Elections asking if she was available to work on election day; she thereafter received training and was assigned to a polling place, where she worked as a poll worker or inspector on election day. Her duties included setting up and overseeing tables, signing in voters, showing them how to use the voting machines, keeping track of voting cards and printing a tally of votes at the end of the day, which were reported to the Board of Elections.

Poll clerks, like election inspectors, are appointed, trained, compensated and perform duties as mandated by statute and overseen by the New York State Board of Elections (see Election Law §§ 3-400, 3-402, 3-404, 3-412, 3-420; see also Election Law § 3-102). In the City of New York, they are compensated at a per diem rate established by the Mayor (see Election Law § 3-420 [1]). While, pursuant to those governing statutes, the Board of Elections may have exercised some supervision over the poll workers and their training, this is insufficient, by itself, to establish an employer-employee relationship, and the record is devoid of any proof that any such supervision exercised exceeded that required by law, or that additional duties or requirements were imposed beyond those provided by statute … . Matter of Chorekchan (New York City Bd. of Elections–Commissioner of Labor), 2015 NY Slip Op 04552, 3rd Dept 5-28-15

 

Music Teachers Were Employees Entitled to Unemployment Insurance Benefits—Criteria for Professionals, Like Musicians, Who Do Not Lend Themselves to Direct Supervision or Control, Explained

The Third Department determined music teachers were employees of Encore Music, a service which connected students with teachers for a portion of the fees paid by the students.  Encore unsuccessfully argued the teachers were independent contractors:

…”[W]here the details of the work performed are difficult to control because of considerations such as professional . . . responsibilities,” courts have applied the “‘overall control'” test, which requires that the employer exercise control over “‘important aspects of the services performed'” …, a test which has been applied to musicians who “do not easily lend themselves to direct supervision or control” … . Further, “an organization which screens the services of professionals, pays them at a set rate and then offers their services to clients exercises sufficient control to create an employment relationship” … .

…Encore screened the teachers, checked their references, conducted criminal background checks and then matched students to teachers based upon a variety of factors, including qualifications. Encore thereafter followed up with the students after lessons to ensure that they were satisfied. Encore set the lesson fees, which were generally the same for all teachers with some exceptions, billed students directly and paid teachers regardless of whether the students paid Encore. Although teachers used their own equipment, determined the lesson plans or methods and could decline students, they were required to sign a contract that provided that they would, “when reasonably requested by [Encore], act as a music lesson instructor.” The contract also contained a clause prohibiting teachers from soliciting Encore’s students that was in effect during the contract and for three years after its expiration, although teachers were allowed to work for competitors and to have their own private students. Matter of Encore Music Lessons LLC (Commissioner of Labor), 2015 NY Slip Op 04553, 3rd Dept 5-28-15

 

Sales Rep Was an Employee Entitled to Unemployment Insurance Benefits

The Third Department determined a cellular phone sales representative was an employee entitled to unemployment insurance benefits:

Whether an employer-employee relationship exists within the meaning of the unemployment insurance law “is a factual issue for the Board to resolve and its decision will be upheld if supported by substantial evidence” … . “While no single factor is determinative, control over the results produced or the means used to achieve those results are pertinent considerations, with the latter being more important” …. .

… The record establishes that Cellular Sales precluded sales representatives from selling competing products and its products outside of the “territory” absent its prior written consent, suggested, and in certain instances required, that products be sold at a minimum price, set sales goals for the sales representatives to attain and provided a script that sales representatives were to “[s]tick to . . . on every customer opportunity” regarding a certain cellular phone. In addition, Cellular Sales specified a certain dress code and provided that any sales representative not meeting such dress code in its store would be “address[ed]” by a leader. Cellular Sales also required sales representatives to, among other things, complete certain mandatory training that it paid for, to “strictly comply” with its directives regarding use, disclosure and application of marketing information and to know and follow certain “procedures for the market.” …[T]he record establishes that Cellular Sales dictated the number of sales representatives that would work in the store on a given day, provided each sales representative with a Cellular Sales email address and business cards, required, for a certain period of time, that sales representatives send customers thank you cards that it provided and supplied the sales representatives with products for demonstrations. The record also indicates that Cellular Sales reprimanded sales representatives regarding tardiness, held mandatory meetings, required sale representatives who chose to work in the store to submit their availability and requests for days off and, once a shift was assigned, required a sales representative to secure coverage if he or she could not work on the assigned shift. Matter of Pratt (Cellular Sales of N.Y., LLC–Commissioner of Labor), 2015 NY Slip Op 04549, 3rd Dept 5-28-15

 

Categories

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

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy