| Matter of Knavel v West Seneca Cent. Sch. Dist. |
| 2017 NY Slip Op 03416 [149 AD3d 1614] |
| April 28, 2017 |
| Appellate Division, Fourth Department |
[*1]
| In the Matter of Victoria Knavel and Others, on Behalf ofThemselves and Certain Other Retired Employees of West Seneca Central School DistrictFormerly in CSEA Bargaining Unit, Appellants, v West Seneca Central School District et al.,Respondents. |
Steven A. Crain and Daren J. Rylewicz, Civil Service Employees Association, Inc., Albany(Aaron E. Kaplan of counsel), for petitioners-appellants.
Hodgson Russ LLP, Buffalo (Aaron M. Saykin of counsel), forrespondents-respondents.
Appeal from a judgment (denominated order) of the Supreme Court, Erie County (John L.Michalski, A.J.), entered April 13, 2015 in a proceeding pursuant to CPLR article 78. Thejudgment granted the pre-answer cross motion of respondents to dismiss the petition anddismissed as moot the motion of petitioners for leave to amend the petition.
It is hereby ordered that the judgment so appealed from is reversed on the law without costs,the cross motion is denied, the petition is reinstated, respondents are granted 20 days fromservice of the order of this Court with notice of entry to serve and file an answer, and the matteris remitted to Supreme Court, Erie County, for a determination of the motion for leave to amendthe petition.
Memorandum: Petitioners, who are retired employees of respondent West Seneca CentralSchool District (District) and under the age of 65 years old, commenced this CPLR article 78proceeding seeking to annul respondents' determination to discontinue the practice of offering"Under Age 65 retirees" the option of carrying their health insurance through the District's activeemployee Blue Cross/Blue Shield plan. During their employment with the District, petitionerswere covered under a collective bargaining agreement between the District and the Civil ServiceEmployees Association, Inc., Local 1000, AFSCME, AFL-CIO (CSEA), which allowedpetitioners to enroll in the same Blue Cross/Blue Shield health insurance and Guardian dentalinsurance plans available to the District's current employees, at their own expense. On June 5,2014, the District mailed to "Retirees Under age 65 carrying BlueCross BlueShield HealthInsurance" an undated letter stating "that effective July 1, 2014, West Seneca Central SchoolDistrict will no longer offer Under Age 65 retirees the option of carrying their health insurancethrough the active employee Blue Cross Blue Shield plan." On June 18, 2014, following ameeting with affected retirees, the District issued to "retirees under age 65 Carrying BlueCrossBlueShield Health Insurance" a letter stating that "the District has decided to extend your abilityto participate in the CSEA Health Insurance Plan until August 1, 2014." On July 31, 2014, theDistrict cancelled insurance coverage for retirees under age 65. According to petitioners, theDistrict's actions violated the "Retiree Health Insurance Moratorium Law" (L 2009, ch 504,§ 1, part B, § 14).
Petitioners moved for leave to amend the petition and, in lieu of filing an answer, [*2]respondents cross-moved to dismiss the petition on the ground thatit was barred by the four-month statute of limitations (see CPLR 217 [1]). Supreme Courtgranted the cross motion and dismissed the petition, further concluding that petitioners' motion toamend was moot. We reverse.
Initially, we and our dissenting colleagues agree that the "determination to be reviewed" inthis proceeding is the decision embodied in the undated letter sent on June 5, 2014 (CPLR 217[1]). We note that respondents correctly concede that they bear the burden of establishing in thefirst instance that the proceeding was not timely commenced within the applicable four-monthstatute of limitations (see id.;Matter of Bill's Towing Serv., Inc. v County of Nassau, 83 AD3d 698, 699 [2011]).
Respondents contend that the date of mailing, rather than the date of receipt by petitioners, ofthe undated letter to petitioners notifying them of the discontinuance of their participation in theDistrict's health insurance plan, was the event which began the running of the statute oflimitations. In order to apply the date of mailing to the analysis, which involves a constructivenotice test, it is necessary to make the legal conclusion, as a threshold matter, that thedetermination at issue was "quasi-legislative" in nature (see Matter of Owners Comm. onElec. Rates v Public Serv. Commn. of State of N.Y., 76 NY2d 779, 780 [1990], revg ondissenting op of Levine, J., 150 AD2d 45, 51-54 [1989]). Respondents contend that theundated letter is properly characterized as a "quasi-legislative" decision, that actual notice is notrequired, and that constructive notice by mailing was sufficient to commence the four-monthlimitations period. We recognize that at oral argument of this appeal petitioners' counsel joined inthe legal conclusion that the determination was "quasi-legislative." However, this Court is notbound by an erroneous concession of counsel or the parties with respect to a legal principle andsuch "concession does not . . . relieve us from the performance of our judicialfunction and does not require us to adopt the proposal urged upon us" (People v Berrios,28 NY2d 361, 366-367 [1971]). "When an issue or claim is properly before the court, the court isnot limited to the particular legal theories advanced by the parties, but rather retains theindependent power to identify and apply the proper construction of governing law" (Kamen vKemper Financial Services, Inc., 500 US 90, 99 [1991]). We simply cannot turn a blind eyeto the unsubstantiated and patently erroneous legal conclusion offered by the parties on thisrecord (see generally Arcadia v Ohio Power Co., 498 US 73, 77 [1990], rehdenied 498 US 1075 [1991]). We have no quarrel with a litigant conceding an issue of fact(see Elston v Canty, 15 AD3d990, 990 [2005]), or conceding that a bill of particulars is sufficiently specific (seeGriswold v Kurtz, 80 AD2d 983, 983 [1981]), or waiving a beneficial right (see Mitchellv New York Hosp., 61 NY2d 208, 214 [1984]). Those types of concessions do not intrudeupon the judicial function of correctly identifying and applying the law to the facts.
A quasi-legislative-type administrative determination is one having an impact far beyond theimmediate parties at the administrative stage (see Owners Comm. on Elec. Rates, 150AD2d at 53 [Levine, J.]; Matter ofPlainview-Old Bethpage Congress of Teachers v New York State Health Ins. Plan, 140AD3d 1329, 1331 [2016]). Thus, where a quasi-legislative determination is challenged,"actual notice of the challenged determination is not required in order to start the statute oflimitations clock" (Matter of SchoolAdm'rs Assn. of N.Y. State v New York State Dept. of Civ. Serv., 124 AD3d 1174,1176 [2015], lv denied 26 NY3d 904 [2015]). The policy underlying the rule is thatactual notice to the general public is not practicable (see Owners Comm. on Elec. Rates,150 AD2d at 53). Instead, the statute of limitations begins to run once the administrative agency'squasi-legislative determination of the issue becomes "readily ascertainable" to the complainingparty (Matter of Riverkeeper, Inc. vCrotty, 28 AD3d 957, 962 [2006]).
On the other hand, where the public at large is not impacted by a determination, actualnotice, commonly in the form of receipt of a letter or other writing containing the final andbinding determination, is required to commence the statute of limitations (see Matter of EssexCounty v Zagata, 91 NY2d 447, 453 [1998]; New York State Assn. of Counties vAxelrod, 78 NY2d 158, 165-166 [1991]).
Here, the only evidence submitted by respondents with respect to the determination todiscontinue the practice of permitting "Under Age 65 retirees" the option of carrying their healthinsurance through the District's Blue Cross/Blue Shield plan was the undated letter that wassigned by the "Assistant Superintendent, Human Resources." That letter makes no mention ofany meeting of, or resolution by, respondent West Seneca Central School District Board of [*3]Education (Board of Education) at which the participation of"Under Age 65 retirees" in the health insurance plan was discussed or voted upon. The AssistantSuperintendent does not mention the authority, if any, upon which he issued the letter. Theundated letter does not identify when the determination was made or by whom it was made. Theletter does not indicate that it was the Assistant Superintendent's decision to make or that he wasacting at the direction of the Board of Education or respondent Dr. Mark J. Crawford,Superintendent of Schools (Superintendent).
In other words, respondents wholly failed to submit any evidence establishing the processthat resulted in the issuance of the undated letter, and the record is otherwise devoid of anyevidence of the nature of the process giving rise to the determination. In our view, all of thosefacts and factual shortcomings are critical to the analysis. Moreover, respondents do not explainhow dropping the letter in the mailbox made the determination "readily ascertainable" toanyone—and more particularly to the individual petitioners/retirees.
The determination clearly had no impact upon the public at large, and respondents havewholly failed to establish that actual notice to the affected persons would be impracticable orunduly burdensome. Indeed, in their moving papers, respondents failed to quantify the number ofaffected "Under Age 65 retirees." Even assuming, arguendo, that a District resident or taxpayersought to challenge the determination, we note that respondents fail to explain how the undatedletter, privately addressed and mailed only to "Under Age 65 retirees," would be "readilyascertainable" to a resident or taxpayer in the District so as to commence the running of thestatute of limitations with respect to such a challenge. Nor do respondents explain how an"Under Age 65 retiree" would be expected to know that he or she was aggrieved by the undatedletter when nothing further in the way of notice was given by respondents other than dropping theletter in a mailbox (cf. School Adm'rs Assn. of N.Y. State, 124 AD3d at 1177-1178).
We thus conclude that respondents failed to meet their burden of establishing that thechallenged determination was "quasi-legislative" and, therefore, that the "readily ascertainable"constructive notice test should be applied herein (Riverkeeper, Inc., 28 AD3d at 962;see School Adm'rs Assn. of N.Y. State, 124 AD3d at 1176-1177).
We further conclude that our decision in Matter of Jones v Board of Educ. of WatertownCity School Dist. ([appeal No. 2] 30 AD3d 967 [2006]), is inapplicable to the facts presentedhere. In Jones, the Board of Education passed a resolution that required retirees tocontribute to their health insurance premiums. The impacted retirees were informed of theresolution in a letter from the Superintendent of the subject school district that was mailed to andreceived by the petitioners. Jones concluded that the mailing of the letter—notreceipt—was the triggering event for commencing the limitations period (id. at968-969). Nonetheless, Jones did not address the issue whether the determination was"quasi-legislative." Nor did it resolve the question of why the subject school board's resolutionwas not the triggering event in that case. Even assuming, arguendo, that the Jones Courtconsidered the determination to be of a "quasi-legislative" nature, in our view it may very wellhave been that the Jones Court concluded that a school board's public meeting, publishedresolution, and mailing—in combination—made the determination "readilyascertainable" (see School Adm'rs Assn. of N.Y. State, 124 AD3d at 1176-1177).However, inasmuch as Jones neither explicitly addressed nor resolved those issues, weconclude that it has no precedential value toward the resolution of this appeal on the facts beforeus.
Lastly, inasmuch as respondents, in our view, failed to meet their burden to establish whenthe four-month statute of limitations commenced, the burden did not shift to petitioners toestablish any particular date of individual receipt of the undated letter. In any event, respondentsfailed to establish any dates of receipt by petitioners in their moving papers.
Finally, we further conclude that "[t]he grant of an extension of time to comply with the finaldetermination was merely incidental to that determination and did not affect" the time at whichthe statute of limitations began to run (Matter of S.S. Canadiana Preserv. Socy. vBoardman, 262 AD2d 961, 962 [1999] [internal quotation marks omitted]; see Matter ofMetropolitan Package Store Assn. v Duffy, 143 AD2d 832, 833 [1988], lv denied 73NY2d 705 [1989]). Carni and DeJoseph, JJ., concur.
Peradotto, J.P., concurs in the following memorandum.
Peradotto, J.P. (concurring). I agree with petitioners that Supreme Court erred in grantingrespondents' pre-[*4]answer cross motion to dismiss the petitionas time-barred and denying as moot petitioners' motion for leave to amend the petition. However,inasmuch as my rationale for reaching that conclusion differs from the plurality, I concur in theresult only.
There is no dispute that this CPLR article 78 proceeding is governed by the statute oflimitations period set forth in CPLR 217 (1), which requires that a petitioner commence theproceeding " 'within four months after the determination to be reviewed becomes finaland binding upon the petitioner' " (Walton v New York State Dept. of Correctional Servs., 8 NY3d186, 194 [2007]). "An administrative determination becomes 'final and binding' when tworequirements are met: completeness (finality) of the determination and exhaustion ofadministrative remedies. 'First, the agency must have reached a definitive position on the issuethat inflicts actual, concrete injury and second, the injury inflicted may not be . . .significantly ameliorated by further administrative action or by steps available to the complainingparty' " (id. at 194). Here, the undated letter indicating that respondent WestSeneca Central School District (District) would no longer offer retirees under age 65 the optionof carrying health insurance through the active employee Blue Cross/Blue Shield plan constitutedrespondents' definitive position on that issue, which could not have been " 'significantlyameliorated by further administrative action or by steps available to [petitioners]' "(id.; see Matter of SchoolAdm'rs Assn. of N.Y. State v New York State Dept. of Civ. Serv., 124 AD3d 1174,1177 [2015], lv denied 26 NY3d 904 [2015]). Contrary to petitioners' contention, theDistrict's subsequent action in granting an extension to affected retirees with respect to theeffective date of the final determination "was merely incidental to that determination" and did notaffect its finality (Matter of S.S. Canadiana Preserv. Socy. v Boardman, 262 AD2d 961,962 [1999]; see School Adm'rs Assn. of N.Y. State, 124 AD3d at 1177-1178; Matterof Metropolitan Package Store Assn. v Duffy, 143 AD2d 832, 833 [1988], lv denied73 NY2d 705 [1989]).
I nonetheless agree with petitioners that respondents failed to meet their initial burden ofestablishing that the petition was untimely because the time to commence the proceeding hadexpired, which required that respondents establish, inter alia, when the statute of limitationsbegan to run (see generally Matter of Village of Westbury v Department of Transp. of State ofN.Y., 75 NY2d 62, 73 [1989]; Larkin v Rochester Hous. Auth., 81 AD3d 1354, 1355 [2011]).Initially, the nature of the determination must be ascertained in order to resolve when the statuteof limitations began to run. I agree with the parties and the dissent that respondents' decision tono longer offer retirees under age 65 the option of carrying health insurance through the activeemployee plan was a quasi-legislative determination (see Matter of Owners Comm. on Elec.Rates v Public Serv. Commn. of State of N.Y., 76 NY2d 779, 780 [1990], revg ondissenting op of Levine, J., 150 AD2d 45, 51-54 [1989]; see generally School Adm'rsAssn. of N.Y. State, 124 AD3d at 1175-1176). The nature of the determination, i.e., thedecision of a school district to discontinue offering certain of its retirees enrollment access to aparticular health insurance plan, has none of the hallmarks of quasi-judicial decision-making(see Vincent C. Alexander, Practice Commentaries, McKinney's Cons Laws of NY, Book7B, CPLR C7801:2).
"In the context of quasi-legislative determinations . . . , actual notice of thechallenged determination is not required in order to start the statute of limitations clock; rather,the statute of limitations begins to run once the administrative agency's 'definitive position on theissue [becomes] readily ascertainable' to the complaining party" (School Adm'rs Assn. ofN.Y. State, 124 AD3d at 1176-1177; see Owners Comm. on Elec. Rates, 150 AD2dat 53 [Levine, J., dissenting]). Thus, a quasi-legislative determination becomes binding, and thestatute of limitations begins to run, on the date that the aggrieved party is constructively notifiedof the challenged determination, i.e., when that determination becomes readily ascertainable tothe aggrieved party (see School Adm'rs Assn. of N.Y. State, 124 AD3d at 1176-1177;see generally Village of Westbury, 75 NY2d at 72).
Respondents assert that the statute of limitations began to run on June 5, 2014, when theymailed the undated letter to the affected retirees, and that the proceeding was commenced onOctober 10, 2014 after expiration of the four-month statute of limitations period. Whilerespondents established that they mailed the undated letter, both their submissions and the caseupon which they rely, Matter of Jones vBoard of Educ. of Watertown City School Dist. (30 AD3d 967, 968-969 [2006]), fail toexplain how that action alone, i.e., placing the letter in the custody of the United States PostalService on June 5, 2014 for regular delivery, could have rendered the [*5]determination contained in that letter readily ascertainable to theaffected retirees on that same date. The record does not establish that respondents undertook anyother notification procedures to disseminate the subject information that would have adequatelyprovided petitioners with constructive notice of the District's determination on that date (cf.Owners Comm. on Elec. Rates, 150 AD2d at 52 [Levine, J., dissenting]; School Adm'rsAssn. of N.Y. State, 124 AD3d at 1177-1178). The email received by the District's personnelsupervisor from a Blue Cross/Blue Shield representative on June 9, 2014, which was submittedby respondents in support of their cross motion, contained only hearsay statements fromunidentified retirees that they were going to lose coverage after June 30, 2014. Those hearsaystatements are insufficient to establish that the determination was readily ascertainable topetitioners by the date of the email, which would also render the petition untimely (seegenerally Feis v A.S.D. Metal & Mach. Shop, 234 AD2d 504, 505 [1996]; R.Bernstein Co. v Popolizio, 97 AD2d 735, 735 [1983]). Inasmuch as respondents failed tomeet their initial burden on the cross motion in that regard, I conclude that the court erred indismissing the petition as time-barred. It is on that basis alone that I agree with the plurality toreverse the judgment, deny respondents' cross motion, reinstate the petition, and grantrespondents 20 days from service of the order of this Court with notice of entry to serve and filean answer. I likewise agree with the plurality that the matter must be remitted to Supreme Courtto determine petitioners' motion for leave to amend the petition.
NeMoyer and Curran, JJ., dissent and vote to affirm in the following memorandum.
NeMoyer and Curran, JJ. (dissenting). We respectfully dissent. We agree with our colleaguesthat the "determination to be reviewed" is the decision of respondent West Seneca Central SchoolDistrict (District) embodied in the undated letter sent by the District to petitioners on June 5,2014 (CPLR 217 [1]). We disagree with our colleagues, however, on the issue whether the recorddemonstrates that the determination became "final and binding" upon petitioners when the letterwas sent (id.). In our view, inasmuch as the nature of the action taken by the District wasquasi-legislative, the undisputed date of the determination's mailing is, as a matter of publicpolicy, the accrual date (see Matter ofBest Payphones, Inc. v Department of Info. Tech. & Telecom. of City of N.Y., 5 NY3d30, 34 [2005]; Matter of Owners Comm. on Elec. Rates v Public Serv. Commn. of Stateof N.Y., 150 AD2d 45, 53-54 [1989, Levine, J., dissenting], revd on dissenting op ofLevine, J., 76 NY2d 779 [1990]). Accordingly, the four-month statute of limitationsapplicable to the instant CPLR article 78 proceeding began to run when the District sent theundated letter on June 5, 2014, notifying petitioners of the District's determination (see Matter of Jones v Board of Educ. ofWatertown City School Dist., 30 AD3d 967, 968-969 [2006]; see generally Matter ofVillage of Westbury v Department of Transp. of State of N.Y., 75 NY2d 62, 72-73 [1989]).Inasmuch as this proceeding was commenced on October 10, 2014, we conclude that the petitionis time-barred (see Jones, 30 AD3d at 969; see also Matter of Paterson v New York State Teachers' RetirementSys., 25 AD3d 899, 899-900 [2006]).
We respectfully disagree with the plurality's conclusion that the nature of the action takenwas something other than quasi-legislative. That conclusion is of the plurality's own makinginasmuch as it was not raised in any of the parties' briefs, and petitioners conceded at oralargument of this appeal that the determination is quasi-legislative. The plurality relies in partupon the case People v Berrios (28 NY2d 361, 366-367 [1971]), which is rooted inprinciples of criminal and constitutional law safeguarding "[t]he public interest that a result bereached which promotes a well-ordered society . . . in every criminal proceeding"(Young v United States, 315 US 257, 259 [1942]). We respectfully submit thatthe plurality's application of such principles to civil cases overlooks our long-establishedprecedent in civil cases excluding from consideration issues conceded at oral argument (see Elston v Canty, 15 AD3d 990,990 [2005]; Griswold v Kurtz, 80 AD2d 983, 983 [1981]), or in a party's brief (see DeLang v Doctors Hosp., 29 AD2d 735, 735 [1968]), as well as precedent that otherwise allowsthe parties in a civil case to chart their own litigation course, including by circumscribing theissues presented (see Hasselback v 2055Walden Ave., Inc., 139 AD3d 1385, 1387 [2016]; Quilty v Cormier, 115 AD3d 1229, 1230 [2014]; see alsoMitchell v New York Hosp., 61 NY2d 208, 214 [1984]). The plurality also relies onthe case Kamen v Kemper Financial Services, Inc. (500 US 90, 99 [1991]), in which anissue was raised only in a reply brief and was argued to have been waived. That is not thesituation here inasmuch as none of the parties has raised the issue addressed by the plurality.
We agree with our concurring colleague that there is nothing about the District'sdetermination that fits the quasi-judicial category (see New York City Health & Hosps.Corp. v McBarnette, 84 NY2d 194, 203 n 2 [1994], rearg denied 84 NY2d 865[1994]; Matter of Town of Waterford v [*6]Water PollutionControl Bd., 5 NY2d 171, 183 [1959]; see also Matter of Venes v Community SchoolBd. of Dist. 26, 43 NY2d 520, 525 [1978]; Matter of Halperin v City of New Rochelle, 24 AD3d 768, 770[2005], appeal dismissed 6 NY3d 890 [2006], lv denied 7 NY3d 708 [2006]), andwe conclude that the determination fits comfortably within precedent holding that similar actionsare quasi-legislative in nature (see Owners Comm. on Elec. Rates, 150 AD2d at 52[Levine, J., dissenting]; see also Lenihan v City of New York, 58 NY2d 679, 681 [1982];Jones, 30 AD3d at 968-969). We respectfully disagree with the plurality's speculativebasis for distinguishing Jones, which expressly measured the statute of limitations fromwhen the letter was "sent" (Jones, 30 AD3d at 968), and which thereby did not requireactual notice as would be necessary for quasi-judicial action.
While our concurring colleague agrees that the District need show only that petitioners hadconstructive notice, as opposed to actual notice, of the District's decision, she concludes that theDistrict did not meet its burden. She concludes that the District needed to show that it undertookother notification procedures to disseminate the information. That, too, is a point of view that hasnot been raised by the parties. Even if we assume for the sake of argument that the law requiresother notification procedures, we conclude that the accrual date for the statute of limitations stillwould be the undisputed date of the final determination under review, i.e., June 5, 2014 (see Matter of School Adm'rs Assn. of N.Y.State v New York State Dept. of Civ. Serv., 124 AD3d 1174, 1178 [2015], lvdenied 26 NY3d 904 [2015]).
For the reasons given, we would affirm the judgment. Present—Peradotto, J.P., Carni,DeJoseph, NeMoyer and Curran, JJ.