Opinion
CA 03-00581.
November 21, 2003.
Appeal from an order of Supreme Court, Oneida County (Ringrose, J.), entered June 3, 2002, which dismissed the counterclaim.
John W. Dillon, Corporation Counsel, Utica (Charles N. Brown of Counsel), for Respondents-Appellants.
Mark A. Wolber, Utica, for Petitioner-Respondent.
Before: Present: Green, J.P., Wisner, Scudder, Gorski, and Lawton, JJ.
MEMORANDUM AND ORDER
It is hereby ORDERED that the order so appealed from be and the same hereby is unanimously reversed on the law without costs, the counterclaim is reinstated and the matter is remitted to Supreme Court, Oneida County, for further proceedings on the counterclaim.
Memorandum: Petitioner, a disabled firefighter receiving disability retirement benefits pursuant to General Municipal Law § 207-a (2), commenced this proceeding seeking in effect to prevent respondents, the City of Utica and its Employee Benefits Coordinator (collectively, City), from reducing those benefits by the amount of supplemental retirement benefits petitioner received pursuant to Retirement and Social Security Law § 378. The City asserted a counterclaim for recoupment of alleged overpayments to petitioner. Supreme Court granted the petition and dismissed the counterclaim, and on a prior appeal this Court affirmed the judgment ( Matter of Farber v. City of Utica, 282 A.D.2d 39). The Court of Appeals thereafter reversed our order, dismissing the petition and reinstating the counterclaim, and the Court remitted the matter to Supreme Court for further proceedings on the counterclaim ( Matter of Farber v. City of Utica, 97 N.Y.2d 476, 480-481). On remittal, Supreme Court dismissed the counterclaim, and this appeal ensued.
We reverse. Although we reject the City's contention that it would be "against equity and good conscience to permit the [petitioner] to retain what is sought to be recovered" ( Paramount Film Distrib. Corp. v. State of New York, 30 N.Y.2d 415, 421, mot to amend remittitur granted 31 N.Y.2d 678, rearg denied 31 N.Y.2d 709, cert denied 414 U.S. 829), we nevertheless conclude that the City is entitled to recoup those funds. The City has a "common-law right of action * * * to recover an overpayment of governmental moneys" ( Matter of Daleview Nursing Home v. Axelrod, 62 N.Y.2d 30, 33), and we therefore reject petitioner's contention that the City should be estopped from recovering such funds herein. "[T]he severely limited recognition of estoppel as a defense to an action for recoupment stems not from the thought that the recipient of an overpayment may not have equities in his * * * favor, but from considerations of sovereign immunity, protection of the public fisc, and separation of powers * * *, leading to the conclusion that it is better that the recipient `should now and then suffer by such mistakes, than to introduce a rule against the abuse of which * * * it would be very difficult for the public to 595, 601-602). We therefore reverse the order, reinstate the counterclaim and remit the matter to Supreme Court, Oneida County, for protect itself'" ( id. at 34; see generally Matter of Schwartfigure v. Hartnett, 83 N.Y.2d 296, 300-301; Matter of Couch v. Perales, 78 N.Y.2d further proceedings on the counterclaim.