| Williams v Village of Endicott |
| 2012 NY Slip Op 00276 [91 AD3d 1160] |
| Jnury 19, 2012 |
| Appellate Division, Third Department |
| Richard Williams, on Behalf of Himself and All Other RetiredEndicott Police Officers Similarly Situated, Respondent-Appellant, v Village ofEndicott, Appellant-Respondent. |
—[*1] The Tuttle Law Firm, Latham (James B. Tuttle of counsel), forrespondent-appellant.
Peters, J. Cross appeals (1) from an order of the Supreme Court (Reynolds Fitzgerald, J.),entered December 7, 2010 in Broome County, which, among other things, denied plaintiff's anddefendant's motions for summary judgment, and (2) from an order of said court, entered June 2,2011, which denied plaintiff's and defendant's motions to renew.
Plaintiff retired from defendant's police department in 1998. The collective bargainingagreement (hereinafter CBA) in effect between defendant and plaintiff's union at that timeprovided that defendant "shall keep in full force and effect medical coverage and hospitalcoverage for each member of the bargaining unit, with benefits to be of a value at least equivalentto those presently in force[,] subject to the following conditions . . . All unitmembers retiring during the terms of this agreement agree that subsequent to their retirement,and in consideration of [defendant's] agreement to continue their health insurance coverage, theywill continue to pay a contribution toward their annual health insurance premium and suchcontribution shall be a [*2]sum of $500.00 per annum for familycoverage, and a sum of $200.00 per annum for individual coverage."[FN*]When plaintiff became eligible for Medicare Part B coverage in 2007, he was informed that thehealth insurance provided by defendant would not cover services that would be covered underMedicare Part B, even if he failed to enroll in the program. As a result, plaintiff enrolled inMedicare Part B and was charged a separate premium by Medicare, which was deducted from hisSocial Security benefits. When defendant refused plaintiff's request for reimbursement, plaintiffcommenced this action seeking a declaration that the CBA required defendant to cover the costsassociated with his Medicare Part B coverage. Following joinder of issue, plaintiff moved forsummary judgment and defendant cross-moved for, among other things, summary judgmentdismissing the complaint. Finding the CBA to be ambiguous as to the specific coverage thatdefendant is obligated to provide, Supreme Court denied both motions. The parties' subsequentmotions to renew were also denied by the court. The parties cross-appeal from both orders.
"In determining the obligations of parties to a contract, courts will first look to the expresscontract language used to give effect to the intention of the parties, and where the language of acontract is clear and unambiguous, the court will construe and discern that intent from thedocument itself as a matter of law" (Shook v Blue Stores Corp., 30 AD3d 811, 812 [2006] [internalquotation marks and citations omitted]; see Angelino v Michael Freedus, D.D.S., P.C., 69 AD3d 1203,1205-1206 [2010]; Bauersfeld v Boardof Educ. of Morrisville-Eaton Cent. School Dist., 46 AD3d 1003, 1005 [2007], lvdenied 10 NY3d 704 [2008]). Whether a contract is ambiguous is a question of law to beresolved by the court (see W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162 [1990]; Stevens & Thompson Paper Co., Inc. vNiagara Mohawk Power Corp., 49 AD3d 1011, 1012 [2008]; CV Holdings, LLC v Artisan Advisors,LLC, 9 AD3d 654, 656 [2004]). "A contract is ambiguous if the language used lacks adefinite and precise meaning, and there is a reasonable basis for a difference of opinion" (Pozament Corp. v AES Westover,LLC, 27 AD3d 1000, 1001 [2006] [citations omitted]; see Greenfield v PhillesRecords, 98 NY2d 562, 569 [2002]; CV Holdings, LLC v Artisan Advisors, LLC, 9AD3d at 656).
We find an ambiguity as to whether Medicare Part B coverage is a component of the"medical coverage and hospital coverage" that defendant agreed to provide to retirees under theCBA. Notably, the CBA does not define what is encompassed by "medical coverage and hospitalcoverage" and is silent with respect to the treatment of costs associated with a federal medicalinsurance plan, such as Medicare. The provision in the CBA requiring defendant to [*3]provide "medical coverage and hospital coverage" with benefits "ofa value at least equivalent to those presently in force" could be interpreted to mean, as defendantsuggests, that subsequent to his retirement plaintiff is entitled to continued private healthinsurance coverage from defendant having, at a minimum, the same terms and conditions asthose in effect at the time of his retirement. In that regard, the parties do not dispute that thehealth insurance plan provided by defendant to plaintiff at the time of his retirement contains thesame terms as that presently in effect, including the coordination of benefits provision thatprovides that the insurance becomes secondary upon plaintiff's eligibility for Medicare. Thus,under this reading, defendant has fulfilled its obligation under the CBA to provide healthinsurance coverage with benefits "of a value at least equivalent" to those in force at the time ofplaintiff's retirement, and would have no obligation to cover the costs associated with plaintiff'sMedicare Part B coverage.
On the other hand, the operative language could be read to require defendant to continue toprovide and pay for a defined level of health insurance benefits—i.e., those in place at thetime of retirement—without resort to any particular insurance plan or provider, subject toplaintiff's $500/$200 annual contribution. There is no dispute that, upon plaintiff's eligibility forMedicare Part B, the health insurance coverage provided by defendant became secondary toMedicare Part B, such that it would no longer cover any expenses or benefits that would becovered under Medicare. Therefore, under this interpretation, which is advocated by plaintiff, thehealth insurance coverage provided by defendant afforded him benefits of a lesser value thanthose in force at the time of his retirement. In order to maintain the level of benefits "of a value atleast equivalent to those . . . in force" at the time of his retirement, plaintiff wasrequired to enroll and participate in Medicare Part B, which carried with it a premium.Consequently, plaintiff must now pay more than the $500/$200 annual contribution limit setforth in the CBA in order to sustain benefits equivalent to those he was receiving at the time ofhis retirement. Inasmuch as the CBA limits plaintiff's contribution for equivalent healthinsurance coverage to $500/$200 per year, defendant would be obligated, under this reading ofthe language of the CBA, to cover the costs associated with his Medicare Part B coverage.
In our view, the parties have advanced two equally plausible and reasonable interpretationsof the CBA provision in question, thereby evidencing an ambiguity that requires consideration ofevidence outside the four corners of the CBA relevant to the parties' intent (see Seymour v Northline Utils., LLC,79 AD3d 1386, 1388 [2010]; Alternatives Fed. Credit Union v Olbios, LLC, 14 AD3d 779, 781[2005]; CV Holdings, LLC v Artisan Advisors, LLC, 9 AD3d at 656). As the scantextrinsic evidence contained in the record does not dispositively establish the scope of healthinsurance coverage contemplated by the parties, the matter is not amenable to summarydisposition (see Capital Dist. Enters.,LLC v Windsor Dev. of Albany, Inc., 53 AD3d 767, 771 [2008]; Shook v BlueStores Corp., 30 AD3d at 812-813).
Finally, inasmuch as our finding of ambiguity is not affected by consideration of the factspresented by defendant on its motion to renew, defendant was not entitled to renewal (seeCPLR 2221 [e] [2]; Matter of Cohen Swados Wright Hanifin Bradford & Brett v Frank R.Bayger, P.C., 269 AD2d 739, 742 [2000]; Curry v Nocket, 104 AD2d 435, 436[1984], lv denied 64 NY2d 606 [1985]; Rose v La Joux, 93 AD2d 817, 818[1983]).
Mercure, A.P.J., Rose, Lahtinen and Garry, JJ., concur. Ordered that the orders are affirmed,without costs.
Footnote *: The interpretation of thisprovision was previously before this Court when defendant attempted to increase the annualcontributions that retirees were required to pay towards their health insurance premium (Hudock v Village of Endicott, 28AD3d 923 [2006]). There, we found that "the language of the CBA unambiguously providesthat for all times subsequent to the retirement of [the] plaintiffs and other officers who retiredwhile the 1996-1999 CBA was in effect, those retirees are only required to pay defendant acontribution of $500 or $200 toward their annual medical insurance 'in consideration of[defendant's] agreement to continue their health insurance coverage' " (id. at 924).