| Llanos v Shell Oil Co. |
| 2008 NY Slip Op 08099 [55 AD3d 796] |
| October 21, 2008 |
| Appellate Division, Second Department |
| Elaine Llanos, Appellant, v Shell Oil Company et al.,Respondents. |
—[*1] Fulbright & Jaworski LLP, New York, N.Y. (Mark A. Robertson and Brian W. Tilker ofcounsel), for respondents.
In a proposed class action, inter alia, to recover damages for violation of General Business Law§ 349, the plaintiff appeals from an order of the Supreme Court, Rockland County (Berliner, J.),dated May 18, 2007, which granted that branch of the defendants' motion which was to dismiss thecomplaint on the ground that the action is preempted by General Business Law § 396-i.
Ordered that the order is reversed, on the law, that branch of the defendants' motion which was todismiss the complaint on the ground that the action is preempted by General Business Law §396-i is denied, and the matter is remitted to the Supreme Court, Rockland County, for furtherproceedings in accordance herewith.
The defendants sell prepaid gift cards that are subject to a dormancy fee of $1.75 per month if notused for more than 12 months. The plaintiff allegedly purchased several of the cards, the balances ofwhich were reduced to zero by the dormancy fees. She commenced this proposed class action, interalia, to recover damages for violation of General Business Law § 349, breach of contract basedon, among other things, the implied covenant of good faith and fair dealing, and unjust enrichment. Theplaintiff alleged, among other things, that the cards are deceptively marketed and fail to adequatelydisclose the existence of the dormancy fee. The defendants moved to dismiss the complaint aspreempted by General Business Law § 396-i, and pursuant to CPLR 3211 (a) (7) for [*2]failure to state a cause of action. The Supreme Court granted that branchof the defendants' motion which was to dismiss the complaint as preempted by General Business Law§ 396-i. We reverse.
General Business Law § 396-i regulates certain "gift certificates," which are defined toinclude gift cards (see General Business Law § 396-i [1]; Lonner v Simon Prop.Group, 100 AD3d 57 [2d Dept 2008]; Goldman v Simon Prop. Group, Inc., 31AD3d 382 [2006]; Senate Introducer Mem in Support, Bill Jacket, L 2004, ch 170, at 3; 2004McKinney's Session Laws of NY, at 1709). The section requires, inter alia, that the terms andconditions of the same "shall be clearly and conspicuously stated thereon," including "whether any feesare assessed against the balance of the gift certificate" (General Business Law § 396-i [3]). TheAttorney General is granted various powers under the section, including the authority to seek injunctiverelief, restitution, and civil penalties against violators (see General Business Law § 396-i[4]). The section does not expressly provide for a private right of action (compare GeneralBusiness Law § 349 [h]). The provisions of the section are "exclusive and shall preempt anyprovisions of local law, ordinance or code, and no locality shall impose requirements that areinconsistent with or more restrictive than those set forth in this section" (General Business Law §396-i [6]). Here, the defendants contend, each of the plaintiff's causes of action are premised upon analleged violation of General Business Law § 396-i, and there is no private right of actionthereunder. Rather, they argue, the section's grant of powers to the Attorney General, and use of theword "exclusive," evinces a legislative intent to vest the Attorney General with the exclusive authority toenforce a violation of the section. However, this argument lacks merit.
The plaintiff did not expressly plead a cause of action to recover damages for a violation of GeneralBusiness Law § 396-i. Thus, we need not determine whether there is an implied private right ofaction thereunder (see generally Sheehy v Big Flats Community Day, 73 NY2d 629 [1989];CPC Intl. v McKesson Corp., 70 NY2d 268 [1987]). Otherwise, it is a fundamental tenet ofstatutory construction that the Legislature is presumed to be aware of the law in existence at the time ofan enactment and to have abrogated the common law only to the extent that the clear import of thelanguage of the statute requires (see B & F Bldg. Corp. v Liebig, 76 NY2d 689 [1990]).Further, "[t]he general rule is and long has been that 'when the common law gives a remedy, andanother remedy is provided by statute, the latter is cumulative, unless made exclusive by the statute' "(Burns Jackson Miller Summit & Spitzer v Lindner, 59 NY2d 314, 324 [1983], quotingCandee v Hayward, 37 NY 653, 656 [1868]). Here, nothing in the clear import of thelanguage of General Business Law § 396-i requires a conclusion that the Legislature intended toabrogate any common-law remedy arising from alleged deceptive or improper practices concerning giftcertificates or cards. The exclusivity provision of the section cited by the defendants preempts only locallegislation concerning gift certificates or cards that is inconsistent with or more restrictive than that setforth in the section (see General Business Law § 396-i [6]; Senate Introducer Mem inSupport, Bill Jacket, L 2004, ch 170, at 3; 2004 McKinney's Session Laws of NY, at 1709). Nor arethe remedies granted to the Attorney General under General Business Law § 396-i for suchalleged conduct made exclusive. Finally, in general, a General Business Law § 349 cause ofaction may be maintained as to "all deceptive acts or practices declared to be unlawful, whether or notsubject to any other law of this state" (General Business Law § 349 [g]; Farino v Jiffy LubeIntl., 298 AD2d 553 [2002]; Walts v First Union Mtge. Corp., 259 AD2d 322, 323[1999]). Thus, the Supreme Court erred in granting that branch of the defendants' motion which was todismiss the complaint on the ground that the action is preempted by General Business Law §396-i.[*3]
Because the Supreme Court directed the dismissal of thecomplaint solely on the ground that the action was preempted by General Business Law § 396-i,it did not reach those branches of the defendants' motion which were to dismiss each cause of action onthe merits (see Goldman v Simon Prop.Group, Inc., 31 AD3d 382 [2006]). Those branches of the motion remain pending andundecided (see Goldman v Simon Prop.Group, Inc., 31 AD3d 382 [2006]). Accordingly, we remit the matter to the Supreme Court,Rockland County, to determine those branches of the defendants' motion. Mastro, J.P., Ritter, Carniand Eng, JJ., concur.