| Matter of SLS Residential, Inc. v New York State Off. of MentalHealth |
| 2009 NY Slip Op 08236 [67 AD3d 813] |
| November 10, 2009 |
| Appellate Division, Second Department |
| In the Matter of SLS Residential, Inc., et al.,Respondents, v New York State Office of Mental Health, et al.,Appellants. |
—[*1] Law Offices of David L. Trueman, P.C., Mineola, N.Y., for respondents.
In a proceeding pursuant to CPLR article 78 to review a determination of the Commissionerof the New York State Office of Mental Health, which, upon adopting the report of a hearingofficer dated April 17, 2008, made after a hearing, imposed a fine on the petitioners in the totalsum of $110,000 for certain statutory and regulatory violations, the New York State Office ofMental Health and Michael F. Hogan, as Commissioner of the New York State Office of MentalHealth, appeal from an order of the Supreme Court, Putnam County (O'Rourke, J.), datedDecember 3, 2008, which, inter alia, granted the petition, annulled the determination, anddirected the petitioners to schedule a hearing on the issue of damages.
Ordered that the appeal is dismissed and the order is vacated; and it is further,
Adjudged that the petition is granted to the extent that so much of the determination asimposed a fine in the sum of $10,000 upon the petitioners for the alleged illegal use of manualrestraints on the residents of their facilities is annulled, the petition is otherwise denied, and thedetermination is otherwise confirmed; and it is further,
Ordered that one bill of costs is awarded to the appellants.[*2]
The petitioners operate two community residences andone outpatient clinic, all of which are licensed by the New York State Office of Mental Health(hereinafter OMH). On November 6, 2006, OMH conducted a two-day survey of the petitioners'licensed facilities. Subsequently, by letter dated November 17, 2006, OMH directed thepetitioners to cease and desist all admissions to the licensed facilities and to cease and desist theuse of a facility known as "the Barn." In addition, OMH imposed a fine in the sum of $10,000 foreach of eight separate alleged statutory and regulatory violations, totaling $80,000. In a letterdated November 28, 2006, OMH informed the petitioners that it found two violations of thecease and desist orders, and imposed an additional fine in the sum of $15,000 for each violation,totaling $30,000. Consequently, the total fine sought to be imposed against the petitioners was inthe sum of $110,000.
After an evidentiary hearing, a hearing officer upheld OMH's allegations that the petitionersviolated certain statutes and regulations and two cease-and-desist orders, and recommended thata total fine in the sum of $110,000 be imposed on the petitioners. The report of the hearingofficer was adopted in a determination of Michael F. Hogan, the Commissioner of OMH. Thepetitioners then commenced this proceeding pursuant to CPLR article 78 to review thedetermination and for an award of damages. In an order dated December 3, 2008, the SupremeCourt granted the petition, annulled the determination, and directed the petitioners to schedule ahearing date before the court on the issue of damages. OMH and Hogan appeal. We dismiss theappeal, vacate the order, and grant the petition in part and deny it in part.
"Upon judicial review of a determination rendered by an administrative body following ahearing, this Court's function is limited to consideration of whether the determination issupported by substantial evidence" (Matter of S & S Pub, Inc. v New York State Liq. Auth., 49 AD3d654, 654 [2008]; see Matter of Lahey v Kelly, 71 NY2d 135, 140 [1987]; 300Gramatan Ave. Assoc. v State Div. of Human Rights, 45 NY2d 176, 179-180 [1978]). Sincethe petition raises a substantial evidence question, and no objections were raised that could haveterminated that proceeding within the meaning of CPLR 7804 (g), the Supreme Court shouldhave transferred the proceeding to this Court (see Harper v W.E. Rest., Inc., 38 AD3d 602, 603 [2007]; Matter of Sureway Towing, Inc. vMartinez, 8 AD3d 490 [2004]; Matter of Stein v County of Rockland, 259AD2d 552 [1999]). Nonetheless, since the record is now before us, we will treat the proceedingas if it had been properly transferred, and review the proceeding de novo (see Harper v W.E.Rest., Inc., 38 AD3d at 603; Matterof Sureway Towing, Inc. v Martinez, 8 AD3d 490 [2004]; Matter of Stein v Countyof Rockland, 259 AD2d 552 [1999]).
One of the eight alleged statutory and regulatory violations upon which OMH predicted theimposition of a $10,000 fine involved the alleged illegal use of manual restraints on the residentsof the petitioners' facilities. Mental Hygiene Law § 33.04 defines "restraint" as "the use ofan apparatus on a patient which prevents the free movement of both arms or both legs or whichtotally immobilizes such patient, and which the patient is unable to remove easily" (MentalHygiene Law § 33.04 [a]). Mental Hygiene Law § 33.04 (b) provides: "Restraintshall be employed only when necessary to prevent a patient from seriously injuring himself orothers. It may be applied only if less restrictive techniques have been clinically determined to beinappropriate or insufficient to avoid such injury. It may not be employed as punishment, for theconvenience of staff, or as a substitute for treatment programs." Regulations promulgated byOMH also define the term"restraint" as including the use of [*3]an apparatus (see 14 NYCRR 27.2 [d]). However,according to current OMH policy, manual restraints that are employed without the use of anapparatus, such as the "brief safety interventions" used by the petitioners, constitute a "restraint,"and should be employed only where there is a danger to life and limb, and only as a last resort.
State Administrative Procedure Act § 202 (1) (a) provides, in relevant part: "Prior tothe adoption of a rule, an agency shall submit a notice of proposed rule making to the secretaryof state for publication in the state register and shall afford the public an opportunity to submitcomments on the proposed rule" (see NY Const, art IV, § 8). A "rule" is definedby the State Administrative Procedure Act to include "the whole or part of each agencystatement, regulation or code of general applicability that implements or applies law" (StateAdministrative Procedure Act § 102 [2] [a] [i]). A "rule or regulation," for purposes of theNew York State Constitution, has been described as "any kind of legislative or quasi-legislativenorm or prescription which establishes a pattern or course of conduct for the future" (Peoplev Cull, 10 NY2d 123, 126 [1961]). The Court of Appeals has stated that a rule or regulationis "a fixed, general principle to be applied by an administrative agency without regard to otherfacts and circumstances relevant to the regulatory scheme of the statute it administers"(Matter of Roman Catholic Diocese of Albany v New York State Dept. of Health, 66NY2d 948, 951 [1985]; see Matter ofSuffolk Regional Off-Track Betting Corp. v New York State Racing & Wagering Bd., 11NY3d 559, 572 [2008]; Cubas vMartinez, 8 NY3d 611, 621 [2007]; Matter of Cordero v Corbisiero, 80 NY2d771, 772-773 [1992]). Excluded from the definition of a "rule" are "forms and instructions,interpretive statements and statements of general policy which in themselves have no legal effectbut are merely explanatory" (State Administrative Procedure Act § 102 [2] [b] [iv]).
OMH's policy, which essentially amends the Mental Hygiene Law and existing regulationsto include "manual restraints" within the meaning of "restraint," is a rule within the meaning ofthe New York Constitution and State Administrative Procedure Act. Contrary to OMH'scontention, its policy does not merely interpret existing laws and regulations regarding restraints(see Mental Hygiene Law § 33.04 [d]-[f]; 14 NYCRR 27.2 [d]; 587.6 [g]). Rather,OMH is attempting to change Mental Hygiene Law § 33.04 (a) and 14 NYCRR 27.2 (d)by redefining the term "restraint" to include manual restraints (cf. Matter of PharmacistsSocy. of State of N.Y., Inc. v Pataki, 58 AD3d 924, 926 [2009]).
Accordingly, OMH's failure to officially promulgate its policy as a rule or regulationviolated the New York Constitution and State Administrative Procedure Act (see Matter ofRobinson v Perales, 166 AD2d 594, 597 [1990]). Since there was no evidence that thepetitioners used an apparatus to restrain residents, the $10,000 fine imposed on the petitioners forthe alleged use of illegal restraints was not supported by substantial evidence, and that portion ofthe determination must be annulled.
However, there is substantial evidence in the record to support the remaining fines imposedon the petitioners. The evidence demonstrated that the petitioners limited the rights of residentsto receive visitors and communicate freely with persons inside and outside of the facility, inviolation of 14 NYCRR 527.5 (b) (9) and (c). There was also substantial evidence that thepetitioners violated the privacy rights of residents through use of a random drug testing policy,which required residents to be watched by a staff member while providing a urine sample(see 14 NYCRR 527.5 [b] [8]).
In addition, substantial evidence supports the conclusion that the petitioners imposedimproper punitive measures on residents through an Antisocial Personality Disorder group(hereinafter ADP group), which, in some cases, was not voluntary in nature. Consequencesimposed upon members of the [*4]ADP group included the lossof telephone and communication rights, and the wearing of an orange jumpsuit, which madesome residents feel humiliated and invisible (see 14 NYCRR 527.5 [b] [5]). Substantialevidence further supports the determination that the petitioners, through their policies, placedimproper restrictions on the ability of residents to leave the facilities and the programs(see Mental Hygiene Law § 31.19 [a]). In addition, the record demonstrates thatthe petitioners did not have a viable incident management program, in violation of 14 NYCRRpart 524, and failed to fingerprint several employees hired after April 1, 2005, in violation ofMental Hygiene Law § 31.35 (a) and 14 NYCRR 550.5. Furthermore, there wassubstantial evidence that the petitioners' clinical program was not "clearly identifiable" so as todistinguish it from the residential programs, and did not have "separately identifiable staff, spaceand program policies and procedures" (14 NYCRR 587.5 [c]). Furthermore, OMH presentedsubstantial evidence that the petitioners admitted two individuals after receiving the cease anddesist orders barring such admission, and used the Barn to interview one of those individuals, infurther violation of the cease and desist orders.
Accordingly, the fines imposed on the petitioners for these violations, in the total sum of$100,000, were supported by substantial evidence.
To the extent the petition seeks an award of damages, it must be denied, since the petitionersare essentially seeking consequential damages, which are not recoverable in a proceedingpursuant to CPLR article 78 (see CPLR 7806; Matter of Gross v Perales, 72NY2d 231, 236-237 [1988]; Rose Lee Mfg. v Chemical Bank, 186 AD2d 548, 551[1992]).
The petitioners' remaining contentions are without merit. Rivera, J.P., Fisher, Belen andAustin, JJ., concur.