Fourth Department Utilizes U.S. Supreme Court Precedent to Modify Charge against Bail Bond Organization, Confirms other Charges and Penalties
Buffalo Bail Bonds Agency Inc. v. Vullo (March 20, 2020)
This case presented an Article 78 proceeding to review a determination by respondent, Maria Vullo as Superintendent of Department of Financial Services, a New York State Agency. The Agency’s determination found that petitioners, Buffalo Bail Bonds Agency, Inc., and sublicensee George Adu-Gyamfi, had committed various statutory and regulatory violations.
Petitioners commenced a CPLR Article 78 proceeding seeking review of the Agency’s determination revoking their license to operate as a bail bonds agency unless they paid a $11,450 penalty.
The Fourth Department first found that there is substantial evidence to support the determination with respect to charge 1, specification C, which alleged that petitioners allowed persons to delay paying part of their premium for the posting of a bail bond, in violation of Insurance Law § 2324.
Second, the Court found that there is substantial evidence to support the determination with respect to charge 1, specification D, which alleged that petitioners submitted twenty-one bail affidavits which contained untrue information regarding the premiums paid by petitioners’ bail clients, in violation of CPL § 520.20(4).
Third, the Court determined the same with respect to charge 1, specification E, which alleged that petitioners failed to follow proper receipt-issuing procedures, in violation of 11 NYCRR § 28.2. The Court reasoned that respondent’s “rational construction” of the relevant statutes and regulations are entitled to deference, said construction being “neither irrational nor unreasonable.”
Petitioners also argued that the fines imposed were excessive under Insurance Law § 2127(a). The Court disagreed, and applied a plain-text interpretation of the statute to determine that the penalty was not excessive. The statute includes the language that respondent may impose “a penalty in a sum not exceeding five hundred dollars for each offense, and a penalty in a sum not exceeding twenty-five hundred dollars in the aggregate for all offenses.” The Court reasoned that the statute clearly uses the conjunction “and” to indicate that the penalty imposed here was proper, having been comprised of the lesser amount for each offense plus the greater amount additionally.
Lastly, the Court unanimously modified the determination by annulling the part that found petitioners guilty of charge 1, specification A.
Charge 1, specification A alleged that petitioners violated 18 USC § 1033(e)(1)(A) and (B) by willfully permitting a person previously convicted of a felony involving dishonesty to participate in their bail bond business without respondent’s written consent. The Court held that this allegation must be annulled due to a recent United States Supreme Court decision, Rehaif v. United States, 139 S. Ct. 2191 (2019). The Fourth Department held that under Rehaif, to prove charge 1, specification A, respondent was required to determine that petitioners had knowledge that the subject person had been convicted of a felony involving dishonesty. Under the facts of this matter, the Fourth Department found that respondent determined only that the petitioners had knowingly employed said person, without determining whether petitioners knew of any relevant underlying conviction. Accordingly, the Court modified the determination in part with respect to charge 1, specification A and vacating the corresponding penalty. As modified, the determination is now confirmed and the matter is remitted to respondent to redetermine charge 1, specification A in compliance with the Rehaif standard.
Fourth Department Declares Arrest and Incarceration ‘the Antithesis of a Public Accommodation’ in Holding that Police Department Lacked Jurisdiction to Investigate and Adjudicate Arrestee’s Discrimination Complaint
Letray v. City of Watertown Police Dept., et al (March 20, 2020)
This case presented an Executive Law § 298 proceeding. Petitioner-appellant, Deanna Letray, filed an administrative complaint with respondent New York State Division of Human Rights (the SDHR), alleging illegal discrimination during petitioner’s arrest and pre-arraignment, which was performed by respondent City of Watertown Police Department in a facility owned by respondent Jefferson County Sheriff’s Office.
The SDHR dismissed the complaint for lack of jurisdiction. Petitioner then commenced the subject proceeding on the grounds that said dismissal was arbitrary, capricious, and in error under Executive Law. The Supreme Court, Jefferson County dismissed the petition. On appeal, the Fourth Department unanimously affirmed the appealed-from order.
The Fourth Department found that the SDHR has jurisdiction to investigate and adjudicate complaints of unlawful discrimination in the provision of any “public accommodation, resort or amusement” under Executive Law § 296(2)(a). By definition under Human Rights Law, a “public accommodation, resort or amusement” offers “conveniences and services to the public” and is “generally open to all comers.” Accordingly, the Court found that law enforcement does not provide any “conveniences and services” to those arrested and detained, nor are arrest and detention “open to all comers” as required by case law. Prison facilities do not cater or offer their goods to the general public, and to the contrary, arrest and detention are imposed upon a person, not provided to them as a public service. Case law further established that the process of arresting and incarcerating a person is by its very nature a government decree separating the general public from the arrested or incarcerated individual.
The Court thereby “join[ed] the consensus of courts nationwide” in holding that arrest and incarceration are “properly viewed as the antithesis of” a public accommodation. Thus, the SDHR properly concluded that it lacked jurisdiction over petitioner’s narrowly-drawn administrative complaint under Executive Law, and affirmed the lower court’s ruling that the SDHR’s dismissal of the complaint was not arbitrary, capricious, or affected by an error of law.
Fourth Department, Upon Remittitur from the Court of Appeals, Modifies Order Regarding Plaintiff Buffalo Police Officer’s Termination of Employment on Issue of Fair Representation in Collective Bargaining Agreement
Vanyo v. City of Buffalo, et al (March 20, 2020)
This case presented a remittitur from the Court of Appeals. First, an order and judgment of the Supreme Court, Erie County granted defendants’ motion to dismiss the complaint and amended complaint. Upon appeal, the order and judgment was affirmed by the Fourth Department and later modified by the Court of Appeals. The Court of Appeals also remitted the matter to the Fourth Department for consideration of an argument raised, but not addressed, on the prior appeal to the Fourth Department.
The argument at issue concerned whether plaintiff stated a valid cause of action for breach of the duty of fair representation. Plaintiff’s employment as a police officer with the City of Buffalo (City) was terminated following arbitration pursuant to a collective bargaining agreement between the City and defendant Buffalo Police Benevolent Association, Inc. (PBA). The arbitrator found plaintiff guilty of the pending disciplinary charges and that termination was the appropriate penalty. The City thereby terminated plaintiff’s employment. The plaintiff commenced an action against the City and PBA, asserting several causes of action. The issue relevant on appeal was plaintiff’s allegation that the PBA breached its duty of fair representation.
The Fourth Department previously held that the cause of action was properly dismissed as untimely, as plaintiff failed to commence the action for breach of the duty of fair representation within four months of the date the former employee knew or should have known that the breach has occurred, or within four months of the date the former employee suffered action harm, whichever is later. Because actual harm was suffered on October 16, 2014 and the amended complaint was not served until May 21, 2015, well over four months later, plaintiff’s cause of action was properly dismissed as untimely.
The Fourth Department has now, upon remittitur from the Court of Appeals and after considering the PBA’s arguments under a CPLR 3211(a)(7) motion to dismiss for failure to state a cause of action, concluded that plaintiff has stated a cause of action for breach of the duty of fair representation. The Court thereby unanimously modified the order and judgment by denying the part of defendant PBA’s motion seeking dismissal of the first cause of action and reinstating that cause of action, and further denying the part of defendant City’s motion seeking dismissal of the second cause of action and reinstating that cause of action. As thereby modified, the order and judgment are affirmed.
Prepared by Daniel J. Cercone