| Spano v Kings Park Cent. School Dist. |
| 2009 NY Slip Op 02771 [61 AD3d 666] |
| April 7, 2009 |
| Appellate Division, Second Department |
| Rocco Spano, Appellant, v Kings Park Central SchoolDistrict et al., Respondents. |
—[*1] Ingerman Smith, LLP, Hauppauge, N.Y. (Michael G. McAlvin of counsel), for respondentKings Park Central School District. Nancy E. Hoffman, Albany, N.Y. (Paul S. Bamberger of counsel), for respondent CSEA,Local 1000 AFSCME, AFL-CIO.
In an action, inter alia, to recover damages for breach of contract, the plaintiff appeals, aslimited by his brief, from so much of an order of the Supreme Court, Suffolk County (Spinner,J.), dated September 25, 2007, as, upon, in effect, converting the defendants' separate motionspursuant to CPLR 3211 to dismiss the complaint insofar as asserted against each of them intomotions for summary judgment dismissing the complaint insofar as asserted against each ofthem, granted the motions, and denied, as academic, that branch of the plaintiff's cross motionwhich was to compel arbitration.
Ordered that the order is modified, on the law, (1) by deleting the provisions thereof grantingthose branches of the defendants' converted motions which were for summary judgmentdismissing the first, second, third, fifth, sixth, and seventh causes of action insofar as assertedagainst each of them and substituting therefor provisions denying those branches of the motions,and (2) by deleting the provision thereof denying, as academic, that branch of the plaintiff's crossmotion which was to compel arbitration and substituting therefor a provision denying that branchof the plaintiff's cross motion on the merits; as so modified, the order is affirmed insofar asappealed from, with one bill of costs to the plaintiff.
In January 1995 the plaintiff began working for the defendant Kings Park Central School[*2]District (hereinafter Kings Park) as a temporary or substitutecustodian. In August 1996 the plaintiff was hired as a permanent custodian with union benefits,and began paying dues to the defendant CSEA, Local 1000, AFSCME, AFL-CIO (hereinafterCSEA). The plaintiff took a one-year unpaid leave of absence from May 26, 2001 through May20, 2002.
In November 2005 the plaintiff attended a CSEA meeting, at which Rebecca Sobotkin, theCSEA unit president, announced that, pursuant to the collective bargaining agreement(hereinafter CBA) between Kings Park and CSEA, Kings Park would pay a $13,000 retirementbonus to any employee with 10 years of service who notified Kings Park by March 1, 2006, ofhis or her intent to retire by January 1, 2007. The CBA provided, in pertinent part, that: "Aretirement bonus shall be granted eligible employees covered by this contract. An eligibleemployee is one covered by this contract who is eligible to retire . . . and hascompleted 10 years of service in Kings Park School District. . . . Ten years ofcompleted service means continuous service except that persons on an approved leave. . . shall neither lose accrued time nor gain time because of said leave."
On February 28, 2006, based on his belief that he qualified for the retirement bonus, theplaintiff submitted a letter notifying Kings Park of his intent to retire, effective December 29,2006. The plaintiff subsequently learned from Kings Park that he did not qualify for the bonus,since his first 18 months on the job, which he spent in a temporary or substitute capacity, did notcount toward the service requirement, and therefore he would be credited with only 9 years and 4months of service. The plaintiff made an inquiry about rescinding his retirement, but was toldthat he could not do so.
Sobotkin advised the plaintiff that CSEA would not oppose Kings Park's determinationregarding the bonus. According to Sobotkin, the plaintiff did not request that CSEA file agrievance on his behalf. Instead, in January 2007, the plaintiff commenced this action againstKings Park and CSEA, seeking, inter alia, damages for breach of contract and fraud againstKings Park, rescission of his retirement, reinstatement of his employment with Kings Park, and,in effect, damages for breach of the duty of fair representation against CSEA.
At a hearing pursuant to General Municipal Law § 50-h, the plaintiff gave thefollowing testimony. The plaintiff first learned that he was not eligible for the retirement bonusin April 2006 when he asked a Kings Park employee in charge of payroll for a letter confirmingthat he would receive the bonus, and was informed that he had not yet accrued 10 years ofservice. The plaintiff subsequently asked Sobotkin to assist him in obtaining a writtenconfirmation of his entitlement to the bonus, but she advised him that he would have to obtainthe letter on his own. The plaintiff did not speak to anyone at Kings Park about the bonus againuntil October 2006 when he was informed by the secretary to the school superintendent that thesuperintendent "wanted to get [him] the [bonus] by using the 18 months that [he] put in as atemp, but that the union was against it." When the plaintiff asked Sobotkin why CSEA was"fighting" the superintendent's effort to get him the bonus, she replied: "I have to fight it becauseif I give it to you, I have to give it to everybody else." Although Sobotkin acknowledged thatthere was currently no one else in the plaintiff's situation, she explained that she did not want to"set a precedent." The plaintiff was subsequently advised that the superintendent had determinedthat he was not entitled to the retirement bonus. In November 2006 Sobotkin informed theplaintiff that CSEA did not intend to challenge the superintendent's determination.[*3]
Kings Park moved to dismiss the complaint insofar asasserted against it on the grounds, among others, that the plaintiff failed to exhaust hisadministrative remedies and lacked standing to assert claims arising under the CBA. CSEAmoved to dismiss the complaint insofar as asserted against it on the ground, among others, that itdid not breach its duty of fair representation. The plaintiff cross-moved, inter alia, to compelarbitration with Kings Park. The Supreme Court, in effect, converted the defendants' motionsinto motions for summary judgment dismissing the complaint insofar as asserted against each ofthem (see CPLR 3211 [c]), granted the motions, and denied the plaintiff's cross motionas academic. The plaintiff appeals.
The Supreme Court concluded that the defendants were entitled to summary judgmentdismissing the complaint since, as a matter of law, the plaintiff had not completed 10 years ofservice pursuant to the CBA, and therefore was not eligible for the retirement bonus. Wedisagree. When a contract, "read as a whole to determine its purpose and intent," plainlymanifests the intent of the parties, relief may be granted by way of summary judgment(W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162 [1990]). Where, however, thecontractual provision relied upon is ambiguous, "the resolution of the ambiguity is for the trier offact" (State of New York v Home Indem. Co., 66 NY2d 669, 671 [1985]; see Nappy v Nappy, 40 AD3d825, 826 [2007]). Here, the CBA provided, in relevant part, that an employee is eligible toreceive a retirement bonus when he or she "has completed 10 years of service in Kings ParkSchool District." The CBA defined "10 years of completed service" as "continuous service." TheCBA did not define "continuous service," and contained no language indicating that "continuousservice" included only service as a permanent employee. Accordingly, the CBA was ambiguous,since it was silent on the issue of whether "continuous service" included service in a temporaryor substitute capacity. Indeed, according to the school superintendent, Kings Park'sdetermination that "continuous service" referred only to permanent service was not based on anylanguage in the CBA, but was made "pursuant to past practice." Similarly, according toSobotkin, CSEA's position that the plaintiff was not eligible for the retirement bonus was basedsolely on its decision to honor Kings Park's "longstanding interpretation" of the CBA. Thus, theissue of whether the plaintiff was an eligible employee under the CBA cannot be determined as amatter of law, and the defendants, therefore, were not entitled to summary judgment on thatground.
The Supreme Court further concluded, in effect, that CSEA was entitled to summaryjudgment on the ground that it did not breach its duty to the plaintiff to provide fairrepresentation. In order to establish a breach of the duty of fair representation against a union, amember must show that "the union's conduct was arbitrary, discriminatory, or in bad faith"(Lundgren v Kaufman Astoria Studios, 261 AD2d 513, 514 [1999]; see Hickey v Hempstead Union FreeSchool Dist., 36 AD3d 760, 761 [2007]; Ponticello v County of Suffolk, 225AD2d 751, 752 [1996]). We conclude that CSEA failed to make a prima facie showing that it didnot breach its duty of fair representation. The papers submitted by CSEA in support of its motionincluded a transcript of the plaintiff's testimony at the hearing held pursuant to GeneralMunicipal Law § 50-h, which itself revealed the existence of a triable issue of fact as towhether CSEA acted arbitrarily in adopting the position that the plaintiff was not eligible for theretirement bonus, rather than asserting, on the plaintiff's behalf, that his 18 months as atemporary or substitute custodian counted toward his "continuous service," which would havebeen an eminently reasonable interpretation of the relevant provision of the CBA. Under thecircumstances of this case, including Sobotkin's affirmative statements to the plaintiff that it wasCSEA's position that the plaintiff was ineligible for the retirement bonus and that the unionwould not challenge Kings Park's refusal to pay him the bonus, the plaintiff's alleged failure tospecifically request that CSEA file a grievance on his behalf—a request which apparentlywould [*4]have been futile—does not negate the existenceof a triable issue of fact as to whether CSEA breached its duty of fair representation.
Contrary to Kings Park's contention, it was not entitled to summary judgment on the groundsthat the plaintiff failed to exhaust his administrative remedies and lacked standing to enforce theterms of the CBA. Generally, an employee covered by a collective bargaining agreement whichprovides for a grievance procedure must exhaust administrative remedies prior to seekingjudicial remedies (see Matter of Plummer v Klepak, 48 NY2d 486, 489-490 [1979]). Inthis case, the CBA set forth a four-step grievance procedure, and the plaintiff did not completeany of the steps in that procedure. Moreover, an individual union member normally lacksstanding to enforce the terms of a collective bargaining agreement between the union and theemployer (see Hickey v Hempstead Union Free School Dist., 36 AD3d at 761;Berlyn v Board of Educ. of E. Meadow Union Free School Dist., 80 AD2d 572 [1981],affd 55 NY2d 912 [1982]). Nonetheless, a union employee may maintain a direct actionagainst an employer, despite a failure to exhaust available administrative remedies, where theemployee can prove that "the union as bargaining agent breached its duty of fair representationin the handling of the employee's grievance," including situations where "the union refuses topress . . . the individual's claim" (Jackson v Regional Tr. Serv., 54 AD2d305 [1976]; see Vaca v Sipes, 386 US 171, 186 [1967]; Matter of Board of Educ.,Commack Union Free School Dist. v Ambach, 70 NY2d 501, 508 [1987]; Hickey vHempstead Union Free School Dist., 36 AD3d at 761). Here, since there exists a question offact as to whether the CSEA's conduct constituted a breach of its duty of fair representation,there exists a concomitant question of fact as to whether that conduct prevented the plaintifffrom exhausting the remedies provided in the CBA (see Vaca v Sipes, 386 US at 185),thus affording him standing to sue Kings Park for a breach of the CBA and overcoming KingsPark's defense of failure to exhaust administrative remedies. Although Kings Park contends thatthe plaintiff could have processed his grievance by himself without assistance from CSEA(see Matter of Lewis v Klepak, 65 AD2d 637 [1978]), we perceive a triable issue of factas to whether such steps would have been futile, in light of Sobotkin's statements to the plaintiffindicating that CSEA would not be supporting him at any stage of the grievance process.
The Supreme Court properly awarded summary judgment to the defendants dismissing thefourth cause of action, which, inter alia, sought to recover punitive damages. To the extent thatthis cause of action was based upon a breach of contract, punitive damages would be availableonly upon "an extraordinary showing of a disingenuous or dishonest failure to carry out [the]contract" (Gordon v Nationwide Mut. Ins. Co., 30 NY2d 427, 437 [1972]), which theplaintiff cannot make here. To the extent that the fourth cause of action was based upon fraud,punitive damages are not available in the absence of a showing, which the plaintiff cannot makehere, that the defendants acted in a malicious, vindictive, or reckless manner (see ReinahDev. Corp. v Kaaterskill Hotel Corp., 59 NY2d 482, 488 [1983]). Furthermore, punitivedamages are not available against Kings Park, as it is a political subdivision of the State (seeSharapata v Town of Islip, 56 NY2d 332 [1982]).
In light of our determination, that branch of the plaintiff's cross motion which was to compelarbitration should not have been denied as academic. Nonetheless, denial of that branch of thecross motion on the merits was appropriate, since the plaintiff's "use of the courts is 'clearlyinconsistent with [his] later claim that the parties were obligated to settle their differences byarbitration' " (Stark v Molod SpitzDeSantis & Stark, P.C., 9 NY3d 59, 66 [2007], quoting Flores v Lower E. Side Serv. Ctr., Inc.,4 NY3d 363, 372 [2005]).
The parties' remaining contentions are without merit or need not be reached in light of our[*5]determination. Prudenti, P.J., Mastro, Fisher and Dillon, JJ.,concur. [See 2007 NY Slip Op 33211(U).]