Opinion
12118
12-13-2012
Robert K. Holdman, Claimant, v. Office of Court Administration, and STATE OF NEW YORK DEPARTMENT OF CIVIL SERVICE, Defendants.
Gage, Spencer & Fleming, LLP By: William B. Fleming, Esq. For Defendants: Eric T. Schneiderman, Attorney General By: Joan Matalavage, AAG and Cheryl Rameau, AAG
Gage, Spencer & Fleming, LLP
By: William B. Fleming, Esq.
For Defendants:
Eric T. Schneiderman, Attorney General
By: Joan Matalavage, AAG and Cheryl Rameau, AAG
, J.
Defendant moves here to dismiss Robert Holdman's claim, which was brought as a result of the incorrect information he had received as to what his health insurance premiums would be subsequent to leaving public service.
For ease of reference, this Decision and Order will use "defendant" and "State"; the caption sets out the "Office of Court Administration, and State of New York Department of Civil Service" as the defendants.
Mr. Holdman had been an assistant district attorney in Bronx County from August 26, 1991 to June 23, 2005, at which time, upon the Governor's appointment, he began service as a Court of Claims judge and was designated an acting justice of the Supreme Court by the Chief Administrative Judge. Judge Holdman resigned effective September 30, 2011 to engage in the private practice of law.
According to Holdman, in March 2011, he began making inquiries about what benefits he and his family would be as entitled to, specifically as to pension and health insurance, recalling that these discussions continued for about seven months. Claimant has no complaint about the pension information he received. A representative of the New York State and Local Retirement System advised him to continue working at least through August 26, 2011 when he would have a total of 20 years of public service, meaning that each year of service beginning from 1991 would be multiplied by 2% (instead of 1.67%) and then times the final average salary to calculate the value of his annual pension.
Nineteen and one-half years' service credit would yield 32.5% of final average salary, whereas 20 years service would give 40% of final average salary if claimant waited to collect an unreduced pension at age 62; collecting the pension at age 55 means a reduced benefit. (See Retirement and Social Security Law § 604 and exhibits A and B, appended to the Affidavit of Robert K. Holdman, dated July 11, 2012).
As for health insurance, while he was a judge, Holdman was a member of the State Health Insurance Plan (NYSHIP), which is offered across state government, as well as to officers and employees of participating public employers. An individual with 10 years' service in the Plan (including time with more than one employer in the Plan) is considered vested. Holdman was informed by representatives of the judicial benefits unit of the Office of Court Administration that he was vested, and that when he reached age 55, he could pay health insurance premiums covering him and his family at a significantly lower rate than the full rate: then $250 versus $1,600 per month (def affid, exh A [the verified complaint], ¶ 13; cl affirm, ¶ 12). When Holdman resigned in September 2011, he was 47 years old.
See exhibit A to the Affidavit of Robert K. Holdman for his date of birth: January 1964.
Claimant also states that he was informed that if he stopped making payments to NYSHIP, he would not be permitted to rejoin the Plan. Accordingly, William Gilchrist of the judicial benefits office advised him to continue uninterruptedly making full rate premium payments and not participate in his new employer's health plan (cl affid, ¶ 10).
On July 7, 2011, Maureen Maury of the judicial benefits office sent Judge Holdman a memorandum, which provided, in part: "You have advised us that you are considering resigning . . . You may continue your health insurance as a Vestee and pay the employer and the employee shares of your health insurance premium until you reach age 55 at which time you will be considered a retiree and pay retiree premiums" (cl affid, exh D).
After September 30, 2011, Holdman "contacted Mr. Gilchrist's office on numerous occasions to ask when I would begin making premium payments as a vestee" and was told they were processing the paperwork (cl affid, ¶ 19). However, on or about January 20, 2012, claimant received a phone call from Mr. Gilchrist advising him that his Bronx County ADA service would not count toward the NYSHIP vesting threshold of 10 years, and therefore he was ineligible to vest since his judicial service by itself was only a little over 6 years. This information was confirmed in a February 3, 2012 e-mail from Gilchrist. (Cl affid, ¶ 20 & exh E).
When Holdman served there, the Office of the Bronx District Attorney was not a NYSHIP participating employer, or part of a NYSHIP participating employer (def affid, exh B, ¶ 6).
Holdman indicated that had he known, he would have continued on the bench until he had satisfied the 10-year requisite - - another three years and nine months (cl affirm, ¶ 25; def affid, exh A [the verified complaint], ¶ 22). He then would have been responsible for paying the entire health insurance premium for approximately four years after that.
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Defendant argues that claimant is in the wrong forum, that Holdman's claim is essentially equitable and that the Court of Claims generally has jurisdiction only over claims for money damages (Matter of Gross v Perales, 72 NY2d 231 [1988]). Moreover, defendant adds that to the extent that such claim seeks to overturn the determination of an administrative agency, it more properly should have been brought via an article 78 proceeding. For example, see Matter of Grella v Hevesi (38 AD3d 113 [3d Dept 2007]). With that said, in two of its claims for relief, the verified complaint seeks an amount no less than the "difference between the premiums he will have to pay for coverage under a private policy and the premiums he would have paid under the NYSHIP" (def affid, exh A [the verified complaint], ¶¶ 40 & 47). There is some precedent that, if necessary, claims like this one can be recast in terms of damages for purposes of Court of Claims jurisdiction as in (Sims v State of New York, 2005 WL 6214818 [NY Sup 2005, McNamara, J], affd 30 AD3d 949).
Defendant also raises a failure on the part of claimant to timely serve and file his claim. However, it will not be necessary to reach the procedural issues; what will be considered below are immunity and estoppel - - asserted, respectively, on behalf of and against a governmental entity.
Defendant maintains that the claim accrued when Judge Holdman resigned on September 30, 2011, rather than a later date when the information he received about his health insurance premiums was changed (def affid, ¶¶ 4-6).
A ministerial error by the state or a municipality acting in its governmental, as opposed to a proprietary capacity (for example as a property or premises owner ), is immune from suit unless a special relationship running to the individual, rather than the public at large, can be shown. (Valdez v City of New York, 18 NY3d 69 [2011]). No special relationship obtains here, the standard for which was set forth in Cuffy v City of New York (69 NY2d 255 [1987]).
See, for example, Maccarello v County of Suffolk (100 AD3d 972 [2012]).
"The elements of this special relationship' are: (1) an assumption by the municipality through promise or actions, of an affirmative duty to act on behalf of the party who was injured; (2) knowledge on the part of the municipality's agents that inaction could lead to harm; (3) some form of direct contact between the municipality's agents and the injured party; and (4) that party's justifiable reliance on the municipality's affirmative undertaking." (69 NY2d at 260 [citations omitted]). Invariably, a special relationship is invoked in situations which involve the offer of some form of corporeal protection to an individual citizen by a governmental entity.
Mr. Holdman contends that in any case, the State should be estopped from going back on its initial, albeit erroneous, advice. The Court of Appeals has stated that "[g]enerally, governmental agencies are not subject to the defense of estoppel . . . [a]lthough . . . exceptions to the general rule may be warranted in unusual factual situations' to prevent injustice" (Matter of E.F.S. Ventures Corp. v Foster, 71 NY2d 359, 369-370 [1988] [citations omitted]). The Court explained that the reasons for the policy are to prevent fraud and to avoid violating the doctrine of separation of powers.
In Allen v Board of Educ. of Union Free School Dist. No. 20 (168 AD2d 403 [2d Dept 1990], appeal dismissed 77 NY2d 939 [1991]), a case involving retiree health insurance, the Second Department upheld the denial of summary judgment to defendant, thus clearing the way for a trial on whether promissary estoppel was invoked. The Allen facts were considerably different than we have here: the Lynbrook School District had induced a group of employees to retire with the promise to maintain its 100% payment of health insurance premiums for them - - and it was undisputed that the district had the authority to do so.
The facts in Agress v Clarkstown Cent. School Dist. (69 AD3d 769 [2010]) were closer to Judge Holdman's; there the Second Department also upheld the denial of summary judgment on estoppel. Ms. Agress was employed as a school psychologist by the district for nearly 12 years. Plaintiff contended that shortly before she resigned, she was told by an employee in the district's benefits office that since she was a vested employee, if she paid full premiums until the age of 55, thereafter the district would pay half of her premium cost. Agress continued paying premiums and receiving health insurance coverage for some six years after she left the district's employment. The month before Agress turned 55, she so advised the school district, which responded that an error had occurred and that she had not been "entitled to the continuation of health benefits after she resigned" (69 AD3d at 770).
The Agress appellate court did not confront the issue of whether the Clarkstown district was authorized to offer the benefit, and the immunity issue was likely not raised because the district had such authority to offer the benefit and accepted Ms. Agress' premium payments and maintained her enrollment in the district's health plan for six years beyond her resignation.
If incorrect information dispensed by a governmental entity (or entities), at variance with a given statutory/regulatory scheme, can readily be converted into an enforceable promise, such would undermine, if not eviscerate, not only the Court of Appeals' holdings on governmental estoppel (E.F.S. Ventures, supra), but those on immunity as well, as enunciated in McLean v City of New York (12 NY3d 194 [2009]), the above-cited Valdez and most recently, Metz v State of New York (2012 WL 5948966 [2012]). Claimant Holdman has not presented an unusual set of facts and resulting injustice (E.F.S. Ventures, supra) that would give rise to an enforceable promise against the State by estoppel.
See defendant's Affidavit in Support of Motion to Dismiss, exhibit B, the affidavit of the director of insurance programs for the State Department of Civil Service, ¶ 5.
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In view of the foregoing, and having reviewed the parties' submissions, IT IS ORDERED that defendant's motion no. M-81622 is granted and the claim of Robert K. Holdman (no. 121182) is dismissed.
The following papers were reviewed: From Defendant: Notice of Motion to Dismiss with Affidavit in Support of Motion to Dismiss and exhibits A through C; and a Reply Affirmation with exhibits A and B. From Claimant: an Affirmation from counsel with exhibits 1 through 4; and an Affidavit from Robert K. Holdman with exhibits A through E. In addition, oral argument of this matter was held on November 8, 2012.
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New York, New York
December 13, 2012
ALAN C. MARIN
Judge of the Court of Claims