Opinion
No. 100097/2015.
04-20-2016
Michael P. THOMAS, Plaintiff v. NEW YORK CITY DEPARTMENT OF EDUCATION, Dennis M. Walcott, Former Chancellor of the New York City Department of Education, Richard J. Condon, Special Commissioner of Investigation for the New York City School District, Kelita Stratford, and John Doe, Defendants.
Michael P. Thomas, pro se. Evan Schnittman, Assistant Corporation Counsel, New York City Law Department, New York, for defendants.
Michael P. Thomas, pro se.
Evan Schnittman, Assistant Corporation Counsel, New York City Law Department, New York, for defendants.
LUCY BILLINGS, J.
I. PLAINTIFF'S CLAIMS
Plaintiff brings this taxpayer action under New York General Municipal Law (GML) § 51 seeking a declaratory judgment that defendants New York City Department of Education (N.Y.CDOE) and its Chancellor Walcott violated the New York State Constitution by expending public funds for political purposes, and defendants Condon and Stratford intentionally and fraudulently concealed these violations. Plaintiff alleges that Chancellor Walcott's comments about Democratic mayoral candidates at NYCDOE's 2012–2013 principals' conference violated the State Constitution's Gift and Loan Clause because New York City principals were given a compensatory day for attending the conference. NY Const. art. VIII, § 1. Plaintiff further alleges that Walcott used NYCDOE resources to advance his and the incumbent Mayor Michael Bloomberg's political agenda and that NYCDOE also used its resources to advance these views by posting the Chancellor's comments on NYCDOE's website.
Plaintiff filed a complaint with NYCDOE's Special Commissioner of Investigation, defendant Condon, claiming that Walcott's remarks violated Chancellor's Regulation D–130, which requires school personnel to maintain complete neutrality regarding political candidates. Defendant Stratford, the investigator of plaintiff's administrative complaint, found his allegations unsubstantiated.
Plaintiff claims that Condon and Stratford violated New York City Charter § 1116(b) by finding plaintiff's complaint unsubstantiated despite clear and convincing evidence supporting his complaint. Thus Stratford's investigative report was knowingly false or deceptive.
II. PLAINTIFF'S CLAIMS FAIL UNDER GML § 51.
Plaintiff, as a taxpayer, may bring an action against defendants to "prevent any illegal official act ... or to prevent waste or injury to, or to restore" municipal funds. GML § 51. Plaintiff's taxpayer suit will succeed, however, only if defendants' official acts (1) wasted public funds by using public funds for "entirely illegal purposes" or (2) were fraudulent. Godfrey v. Spano, 13 N.Y.3d 358, 373, 892 N.Y.S.2d 272, 920 N.E.2d 328 (2009) ; Mesivta of Forest Hills Inst. v. City of New York, 58 N.Y.2d 1014, 1016, 462 N.Y.S.2d 433, 448 N.E.2d 1344 (1983). See Hill v. Giuliani, 249 A.D.2d 28, 28, 670 N.Y.S.2d 493 (1st Dep't 1998). Defendants move to dismiss the complaint because, even accepting all its allegations as true, it fails to allege that defendants used public funds for entirely illegal purposes or acted fraudulently. C.P.L.R. § 3211(a)(7).
A. Plaintiff Fails to State a Claim to Prevent or Restore an Illegal Expenditure or for a Declaratory Judgment.
In opposition to defendants' motion, plaintiff voluntarily discontinued his claim for restoration of the funds he claims were spent illegally. Defendants consented to the discontinuance. C.P.L.R. § 3217(a)(2). Thus plaintiff seeks only a declaratory judgment that defendants NYCDOE and Walcott violated the State Constitution, and defendants Condon and Stratford violated the City Charter. C.P.L.R. § 3001. Plaintiff acknowledges that the funds he claims were spent illegally already have been spent, so that it is impossible now to prevent their expenditure.
Plaintiff's discontinuance of his claim for restoration of the funds eliminates any controversy that they were spent illegally, wastefully, or fraudulently and thus the court's authority to grant a declaratory judgment. The court may grant a declaratory judgment only on an issue about which a live, ongoing controversy remains. BLT Steak, LLC 57th St. Dorchester, Inc., 93 A.D.3d 554, 554, 940 N.Y.S.2d 603 (1st Dep't 2012) ; Ovitz v. Bloomberg, L.P, 77 A.D.3d 515, 516, 909 N.Y.S.2d 710 (1st Dep't 2010) ; Megibow v. Condominium Bd. of Kips Bay Towers Condominium, 38 A.D.3d 265, 266, 831 N.Y.S.2d 174 (1st Dep't 2007) ; Long Is. Light. Co. v. Allianz Underwriters Ins. Co., 35 A.D.3d 253, 253, 826 N.Y.S.2d 55 (1st Dep't 2006). Here, the issue whether the funds were spent illegally, wastefully, or fraudulently is purely academic, with no effect on any future expenditure of funds for purposes of former Chancellor Walcott's remarks. BLT Steak, LLC 57th St. Dorchester, Inc., 93 A.D.3d at 554, 940 N.Y.S.2d 603 ; Megibow v. Condominium Bd. of Kips Bay Towers Condominium, 38 A.D.3d 265, 266, 831 N.Y.S.2d 174. See Big Four LLC v. Bond St. Lofts Condominium, 94 A.D.3d 401, 402–403, 941 N.Y.S.2d 567 (1st Dep't 2012). The absence of any basis or authority to grant plaintiff's only claim for relief is grounds alone to grant defendants' motion to dismiss this action. C.P.L.R. § 3001 ; Big Four LLC v. Bond St. Lofts Condominium, 94 A.D.3d at 403, 941 N.Y.S.2d 567 ; BLT Steak, LLC 57th St. Dorchester, Inc., 93 A.D.3d at 554, 940 N.Y.S.2d 603 ; Ovitz v. Bloomberg, L.P, 77 A.D.3d at 516, 909 N.Y.S.2d 710 ; Megibow v. Condominium Bd. of Kips Bay Towers Condominium, 38 A.D.3d at 266, 831 N.Y.S.2d 174. Even if plaintiff did not discontinue his claim for restoration of the funds, however, his claim that defendants spent the funds entirely illegally fails in any event.
B. Plaintiff Fails to State a Claim That an Expenditure Was Entirely Unconstitutional.
The State Constitution's Gift and Loan Clause prohibits defendants from expending money to aid any individual, private corporation, or private undertaking. NY Const. art. VIII, § 1 ; 10 E. Realty, LLC v. Incorporated Vil. of Val. Stream, 12 N.Y.3d 212, 215, 879 N.Y.S.2d 361, 907 N.E.2d 274 (2009). The Gift and Loan Clause does not prohibit defendants, however, from expending funds to further a public purpose even if a private individual or entity derives an incidental benefit from the expenditure. Lavin v. Klein, 12 A.D.3d 244, 245, 783 N.Y.S.2d 815 (1st Dep't 2004) ; Schulz v. Warren County Bd. of Supervisors, 179 A.D.2d 118, 121–22, 581 N.Y.S.2d 885 (3d Dep't 1992).
Plaintiff fails to state a claim under GML § 51 that defendants violated Article VIII, § 1, of the State Constitution. Although plaintiff alleges that defendant Walcott used public funds to support political candidates when he made political statements at the 2012–2013 principals' conference, the conference's main purpose was to benefit NYCDOE and its employees, not to endorse political candidates. According to Exhibit D attached to the complaint, the conference provided principals the opportunity to learn from Walcott the "instructional expectations" for the 2013–2014 school year and to "delve into a challenging issue" of the principals' choice. Aff. of Evan Schnittman Ex. D. Even Walcott's references to the education reforms that mayoral candidates were discussing in their election campaign were to contrast those reforms with the education policies that he believed were important for NYCDOE to preserve and that he sought to promote.
Consequently, any benefit that a political candidate may have received from the Chancellor's comments was incidental and thus not in violation of the Gift and Loan Clause. Murphy v. Erie County, 28 N.Y.2d 80, 87–88, 320 N.Y.S.2d 29, 268 N.E.2d 771 (1971) ; Lavin v. Klein, 12 A.D.3d at 245, 783 N.Y.S.2d 815 ; Tribeca Community Assn. v. New York State Urban Dev. Corp., 200 A.D.2d 536, 537, 607 N.Y.S.2d 18 (1st Dep't 1994). As long as the Chancellor's comments did not violate the Gift and Loan Clause, plaintiff's allegation that NYCDOE disseminated the Chancellor's remarks on its website also fails to state a claim that NYCDOE violated the Gift and Loan Clause.
Even if the Chancellor's comments did violate the Gift and Loan Clause, plaintiff still fails to state a claim under GML § 51 against defendants because the purposes of the Chancellor's comments and the principals' conference were not "entirely illegal." Godfrey v. Spano, 13 N.Y.3d at 373, 892 N.Y.S.2d 272, 920 N.E.2d 328 ; Mesivta of Forest Hills Inst. v. City of New York, 58 N.Y.2d at 1016, 462 N.Y.S.2d 433, 448 N.E.2d 1344 ; Fauvell v. Miglino, 111 A.D.3d 596, 598, 974 N.Y.S.2d 115 (2d Dep't 2013). The Chancellor's remarks were just one part of the conference that sought to inform principals about expectations for the coming school year and address "a challenging issue" that confronted each principal. Schnittman Aff. Ex. D. Likewise, the purposes of NYCDOE's website posting of the Chancellor's remarks were not entirely illegal. Godfrey v. Spano, 13 N.Y.3d at 373, 892 N.Y.S.2d 272, 920 N.E.2d 328 ; Mesivta of Forest Hills Inst. v. City of New York, 58 N.Y.2d at 1016, 462 N.Y.S.2d 433, 448 N.E.2d 1344 ; Fauvell v. Miglino, 111 A.D.3d at 598, 974 N.Y.S.2d 115. In sum, NYCDOE did not spend any additional funds for purposes of the Chancellor's remarks, let alone due to the contents of those remarks, other than the funds it spent for the conference's and website's undisputed legitimate purposes.
C. Plaintiff's Claim of Illegality Under the City Charter Is Precluded.
Finally, plaintiff may not rely on the claimed violation of City Charter § 1116(b) by defendants Condon and Stratford as the illegal means by which funds were spent under GML § 51 or as an independent claim. Plaintiff simply claims that defendant investigators, in failing to find that the Chancellor violated regulation D–130, knowingly produced a false investigative report that in turn violated City Charter § 1116(b).
The court (Nervo, J.) already decided against plaintiff on the merits of defendant investigators' determination, in a proceeding that he litigated pursuant to C.P.L.R. Article 78 in this court. Schnittman Aff. Exs. J and K. Therefore, even if petitioner now raises new grounds on which the investigators' determination was unlawful, res judicata bars this claim against Condon, Matter of Hunter, 4 N.Y.3d 260, 269, 794 N.Y.S.2d 286, 827 N.E.2d 269 (2005) ; Bevilacqua v. CPR/Extell Parcel I, L.P., 126 A.D.3d 429, 429, 2 N.Y.S.3d 347 (1st Dep't 2015) ; Andrade v. New York City Police Dept., 106 A.D.3d 520, 521, 965 N.Y.S.2d 450 (1st Dep't 2013) ; Pitcock v. Kasowitz, Benson, Torres & Friedman, LLP, 80 A.D.3d 453, 454, 915 N.Y.S.2d 239 (1st Dep't 2011), and collateral estoppel bars the claim against Stratford. Pinnacle Consultants v. Leucadia Natl. Corp., 94 N.Y.2d 426, 432–33, 706 N.Y.S.2d 46, 727 N.E.2d 543 (2000) ; Parker v. Blauvelt Volunteer Fire Co., 93 N.Y.2d 343, 349, 690 N.Y.S.2d 478, 712 N.E.2d 647 (1999) ; Simmons–Grant v. Quinn Emanuel Urquhart & Sullivan, LLP, 116 A.D.3d 134, 139, 981 N.Y.S.2d 89 (1st Dep't 2014) ; Sanders v. Grenadier Realty, Inc., 102 A.D.3d 460, 461, 958 N.Y.S.2d 120 (1st Dep't 2013). That proceeding provided plaintiff a full and fair opportunity to litigate the unlawfulness of the investigation and its outcome, even if he failed to raise all the grounds for the claimed unlawfulness that he raises here. Howard v. Stature Elec., Inc., 20 N.Y.3d 522, 525, 964 N.Y.S.2d 77, 986 N.E.2d 911 (2013) ; Parker v. Blauvelt Volunteer Fire Co., 93 N.Y.2d at 349, 690 N.Y.S.2d 478, 712 N.E.2d 647 ; Kaufman v. Eli Lilly & Co., 65 N.Y.2d 449, 456, 492 N.Y.S.2d 584, 482 N.E.2d 63 (1985) ; Simmons–Grant v. Quinn Emanuel Urquhart & Sullivan, LLP, 116 A.D.3d at 138, 981 N.Y.S.2d 89.
Plaintiff insists that the court's conclusion there that he lacked standing required a dismissal without prejudice. The court then proceeded, however, to decide that defendant investigators' determination was lawful and to deny the petition on its merits. See 175 East 74th Corp. v. Hartford Acc. & Ind. Co., 51 N.Y.2d 585, 590 n. 1, 435 N.Y.S.2d 584, 416 N.E.2d 584 (1980) ; Springwell Nav. Corp. v. Sanluis Corporacion, S.A., 81 A.D.3d 557, 557–58, 917 N.Y.S.2d 560 (1st Dep't 2011) ; Tico, Inc. v. Borrok, 57 A.D.3d 302, 302, 868 N.Y.S.2d 522 (1st Dep't 2008) ; Pullman Group v. Prudential Ins. Co. of Am., 297 A.D.2d 578, 578, 747 N.Y.S.2d 170 (1st Dep't 2002). Even if the decision on the merits was unwarranted following the decision on standing, as plaintiff now urges here, he never appealed the decision on that or any other ground. See Tico, Inc. v. Borrok, 57 A.D.3d at 302, 868 N.Y.S.2d 522.
III. CONCLUSION
For all the reasons explained above, the court grants defendants' motion to dismiss the complaint. C.P.L.R. § 3211(a)(5) and (7). This decision constitutes the court's order and judgment of dismissal.