Opinion
# 2012-039-282Claim No. 120197Motion # 2012-039-282Claim No. M-80424M-80596Cross-Motion No. CM-80542
03-30-2012
ZARRO, JR. v. STATE OF NEW YORK
Synopsis
Claimant's motion to strike defendant's cross motion is denied. Claimant has not demonstrated grounds justifying this extreme sanction. Defendant's cross-motion to dismiss the claim is granted. The claim is untimely as to claimant's first, second, third and fourth causes of action. Claimant's fifth cause of action, alleging fraud, is dismissed for failure to state a cause of action, as the claim contains no factually supported allegation of misrepresentation. Claimant's discovery motion is denied as moot. Case information
UID: 2012-039-282 Claimant(s): FRANCIS A. ZARRO, JR. Claimant short name: ZARRO, JR. Footnote (claimant name) : Defendant(s): STATE OF NEW YORK Footnote (defendant name) : Third-party claimant(s): Third-party defendant(s): Claim number(s): 120197 Motion number(s): M-80424, M-80596 Cross-motion number(s): CM-80542 Judge: James H. Ferreira Claimant's attorney: Norman J. Voog, Esq. Hon. Eric T. Schneiderman Attorney General of the State of New York Defendant's attorney: By: Jessica Hall Assistant Attorney General Third-party defendant's attorney: Signature date: March 30, 2012 City: Albany Comments: Official citation: Appellate results: See also (multicaptioned case) Decision
A claim for damages was filed with the Clerk of the Court on August 5, 2011. In it, claimant, an inmate, seeks damages for wrongs allegedly committed by the New York State Attorney General's Office in its investigation and criminal prosecution of claimant, beginning in 1997 and culminating in his conviction in 2004 on 13 out of 39 counts in the indictment.
Claimant proceeded pro se in commencing this action. In a decision dated September 20, 2011, the Court granted the application of Norman J. Voog, an attorney admitted to practice law in the State of Connecticut, for admission pro hac vice to this Court for the purpose of representing claimant (see Zarro v State of New York, UID # 2011-039-251, Claim No. 120197, Motion No. M-79959 [Ferreira, J., September 20, 2011]). The Court also denied claimant's motion for pre-claim discovery (id.).
By way of background, Executive Law § 63 (3) grants the Attorney General jurisdiction to investigate and prosecute certain criminal conduct upon the request of certain State officials (see Executive Law § 63 [3]; People v Cuttita, 7 NY3d 500, 507 [2006]). "Thus, when presented with a proper Executive Law § 63 (3) request, the Attorney General may investigate and prosecute alleged illegal activity that falls under the statutory or regulatory authority of the officer making the referral" (People v Cuttita, 7 NY3d at 507 [citation omitted]; see e.g. Matter of Kimyagarova v Spitzer, 16 AD3d 507, 508 [2005]). "[I]f the Attorney General lacks power to prosecute a defendant, any resulting indictment must be dismissed" (People v Gilmour, 98 NY2d 126, 132 [2002]). The Court notes at the outset that claimant has unsuccessfully litigated the issue of the Attorney General's jurisdiction over the investigation and prosecution pursuant to Executive Law § 63 (3), as well as other issues arising from the investigation, in a number of forums, including during the underlying criminal proceedings and on direct appeal (Defendant's Affirmation in Support of its Cross Motion to Dismiss, at Exhibit B) (see e.g. People v Zarro, 66 AD3d 1050, 1051-1052 [2009], lv denied 14 NY3d 894 [2010], cert denied __ US __, 131 S Ct 836 [2010]; People ex rel. Zarro v McKinney, 48 AD3d 844, 844-845 [2008], lv denied 10 NY3d 709 [2008]; see also Zarro v Spitzer, 408 Fed Appx 391, 393 n 2 [2d Cir 2010]).
In this claim, claimant avers that the Attorney General acted in the absence of jurisdiction, as the investigation and prosecution was undertaken in the absence of a proper Executive Law § 63 (3) referral letter, and that the two referral letters disclosed by the Attorney General during the course of the criminal proceedings and during subsequent litigation - dated December 30, 1997 and March 27, 2001 - are not authentic and/or insufficient. Claimant has appended to his claim the two referral letters that he asserts are not genuine and/or insufficient (Claim, Appendix, Exhibit Q-1 and Exhibit Q-5) .Claimant alleges six causes of action: (1) malicious prosecution, abuse of process and unlawful investigation with respect to the charges of which he was acquitted, (2) wrongful "interference with claimant's actual and prospective economic advantage," (3) violation of his "rights to be tried by a court of competent jurisdiction," (4) violation of his State constitutional right against unreasonable searches and seizures, (5) fraud, misrepresentation and concealment of evidence, and (6) "mental anguish, physical deterioration, and legal fees and expenses."
In the first, dated December 30, 1997, Elizabeth McCaul, the then-Acting Superintendent of the New York State Banking Department, informed the then-Attorney General that "[t]he Banking Department has received information which indicates that certain individuals including Mr. William Zuga have engaged in criminal conduct relating to a forged Credit Suisse Group Letter of Credit relating to Timberbrook Golf Estates in violation of the Banking Law and the Penal Law of the State of New York" and requested, pursuant to Executive Law § 63 (3), that the Attorney General's Office "commence an investigation into the commission of any crimes and offenses by the above-named person and/or entities and, if warranted, that you prosecute them, and/or any other persons your investigation uncovers" (Claim, Appendix, Exhibit Q-1). In the second, dated March 27, 2001, McCaul informed the then-Attorney General that the Banking Department had received information that claimant had engaged in criminal conduct relating to the use of fraudulent financial instruments and/or money laundering and requested, pursuant to Executive Law § 63 (3), that the Attorney General's Office "commence an investigation into the commission of any crimes and offenses by the above-named persons and, if warranted, that you prosecute them, and/or any other persons your investigation uncovers" (Claim, Appendix, Exhibit Q-5).
There are three motions currently pending before the Court. The first is a motion filed by claimant seeking an order directing the issuance of (1) a subpoena duces tecum to the Attorney General pursuant to CPLR 2305 and 3101 to produce the original Executive Law § 63 (3) referral letters issued with respect to the investigation of claimant and (2) so-ordered subpoenas to several former State employees pursuant to CPLR 3101 and 3120. The motion also seeks an order directing the Attorney General to provide the original letter or letters to claimant's expert and an order directing the Superintendent of Mt. McGregor Correctional Facility to produce claimant on the dates and times when depositions are scheduled.
Defendant opposes the motion and cross-moves to dismiss the claim pursuant to Court of Claims Act § 10 (3) and 11 on the grounds that it is untimely, fails to state a cause of action and is barred by principles of res judicata and collateral estoppel.
Claimant opposes the cross motionand moves to strike it on the grounds that defendant is barred from filing a motion to dismiss because it has already interposed an answer and that the motion "was only filed in an attempt to stay discovery," "relies upon incomplete documents which are not dispositive of the claims" and does not address or determine the issues that are at the heart of this claim (Motion to Strike ¶¶ 2, 3).
The Court notes, upon defendant's objection, that given defendant's properly-made demand that answering papers be served at least seven days prior to the return date of December 21, 2011, claimant's opposition papers mailed on December 22, 2011 were untimely (see CPLR 2214 [b]). While the Court does not condone such dilatory conduct, it discerns no prejudice in this particular matter, and will therefore accept claimant's untimely opposition papers.
In his motion to strike, claimant also seeks an order preventing discovery from being stayed by defendant's cross motion and permitting him to proceed with taking depositions. On December 9, 2011, in response to correspondence that it received from the parties, the Court stayed discovery until its decision on defendant's cross motion (see CPLR 3214 [b]), rendering this request moot. Inasmuch as claimant has requested relief from the Court's December 9, 2011 order in three letters to the Court dated January 24, 2012, February 9, 2012 and March 5, 2012, these requests are denied. Also in his motion to strike, claimant moved for an extension of time to file his opposition to defendant's cross motion. As the Court has accepted claimant's late opposition papers, this request is also denied as moot.
Initially, the Court denies claimant's motion to strike defendant's cross motion to dismiss. Claimant's contention that defendant waived its right to file a motion to dismiss by filing an answer to the claim is without merit. Defendant preserved its right to seek dismissal of the claim pursuant to Court of Claims Act § 10 (3) and 11 and CPLR 3211 (5) by raising those defenses in its answer (Answer ¶¶ 4, 6, 10) (see CPLR 3211 [e]; Court of Claims Act § 11 [c]), and a motion to dismiss a claim for failure to state a cause of action may be made at any time (see CPLR 3211 [e]; Butler v Catinella, 58 AD3d 145, 151 [2008]). Claimant has not otherwise demonstrated grounds justifying the "extreme sanction" of striking defendant's cross motion (Carnegie Assoc. Ltd. v Miller, 90 AD3d 442, 443 [2011]; see e.g. CPLR 3024 [b]; 3126 [3]; see also Polsky v Tuckman, 85 AD3d 750 [2011]).
The Court will next address defendant's cross motion to dismiss the claim.Initially, the Court finds that claimant's sixth cause of action, in which he alleges that "[f]rom June 1997 to present, [c]laimant has been made to bear constant and intense stress, mental anguish and physical deterioration caused by defendant's continued conduct as described in paragraphs 1 to 99" (Claim ¶ 101), constitutes an allegation of the damages that claimant has suffered as a result of defendant's conduct, and the Court will not consider it as a separate cause of action. In any event, even if the Court construed the final paragraphs of the claim as alleging a cause of action sounding in intentional infliction of emotional distress, the cause of action would be dismissed, as no claim lies against the State for intentional infliction of emotional distress where, as here, the acts complained of constituted official conduct (see Augat v State of New York, 244 AD2d 835, 837 [1997], lv denied 91 NY2d 814 [1998]; Brown v State of New York, 125 AD2d 750, 752 [1986], lv dismissed 70 NY2d 747 [1987]; see also Lynn v State of New York, 33 AD3d 673, 675 [2006]; Matter of Lynch v State of New York, 2 AD3d 1002, 1003 [2003]).
Claimant's request that it rule on his discovery motion before considering defendant's cross motion is denied.
The Court of Claims Act requires, in relevant part, that a claim sounding in unintentional or intentional tort "be filed and served upon the attorney general within [90] days after the accrual of such claim, unless the claimant shall within such time serve upon the attorney general a written notice of intention to file a claim therefor" (Court of Claims Act §§ 10 [3], [3-b]; see also Court of Claims Act § 11). In the event a notice of intention is timely served, then "the claim shall be filed and served upon the attorney general within two years after the accrual" of a claim for "injuries to property or for personal injuries caused by the negligence or unintentional tort" of defendant, and "within one year after the accrual" of a claim for "injuries to property or for personal injuries caused by the intentional tort" of defendant (Court of Claims Act §§ 10[3], [3-b]). It is well settled that "compliance with Court of Claims Act §§ 10 and 11 pertaining to the timeliness of filing and service requirements respecting claims . . . constitutes a jurisdictional prerequisite to the institution of a claim against the State" (Mallory v State of New York, 196 AD2d 925, 926 [1993]; see Davis v State of New York, 89 AD3d 1287, 1287 [2011]; Bush v State of New York, 60 AD3d 1244, 1245 [2009]; Pristell v State of New York, 40 AD3d 1198, 1198 [2007]).
The papers before the Court establish that claimant served a written notice of intention to file a claim upon the Attorney General on October 21, 2009 and that this claim was filed with the Court and served upon the Attorney General on August 5, 2011 (Affirmation in Support of Defendant's Cross Motion, at Exhibit H). With respect to the timeliness of the claim, defendant argues that the claim accrued, at the latest, on July 8, 2004, the date of claimant's conviction, and that the claim is therefore untimely because claimant did not serve a claim or a notice of intention within 90 days after that date. In opposition, claimant argues that the notice of intention was timely because the claim accrued on October 2, 2009, when New York State Banking Department counsel Thomas Eckmier certified that "no [Executive Law § 63 (3) referral letter regarding claimant] ever existed" (Claimant's Response to Defendant's Affirmation and Opposition ¶¶ 16, 18-19). Claimant asserts that this certification established that defendant "had been concealing the truth" concerning the referral letter for eight years (id. ¶ 21) and that the filing and service requirements should be equitably tolled in light of defendant's "deliberate concealment and fraud" (id. ¶ 34).
I. First, Second, Third and Fourth Causes of Action
For purposes of Court of Claims Act § 10, a claim accrues at the time when damages are reasonably ascertainable (see Prisco v State of New York, 62 AD3d 978, 978 [2009], lv denied 13 NY3d 706 [2009]; Richard A. Hutchens CC, L.L.C. v State of New York, 59 AD3d 766, 768 [2009], lv denied 12 NY3d 712 [2009]; Local 851 of Intl. Bhd. of Teamsters v State of New York, 36 AD3d 672, 673 [2007], lv denied 8 NY3d 811 [2007]). In the first cause of action, claimant alleges that, from June 10, 1997 until July 8, 2004, the Attorney General investigated, arrested and prosecuted claimant in the absence of authority and without probable cause with respect to the charges of which he was acquitted. Similarly, in the third and fourth causes of action, claimant asserts, respectively, that the Dutchess County Court acted without jurisdiction from his arrest in September 2002 until his conviction in July 2004, and that he was subject to unlawful searches and seizures from June 1997 until July 2004 in the absence of authority and probable cause. Damages arising from these causes of action - which all relate to the investigation and prosecution of the underlying criminal charges - were reasonably ascertainable, at the latest, on July 8, 2004 when defendant was convicted on several crimes in the indictment and acquitted of several others (see Goddard v State of New York, 173 Misc 2d 1002, 1003-1006 [Ct Cl 1997]). As to the cause of action sounding in tortious interference with existing and prospective business relationships, claimant alleges that, between June 10, 1997 and July 8, 2004, defendant contacted several individuals and "pressured them to terminate their business dealings and association with [c]laimant" (Claim ¶ 90-91). Damages arising from this cause of action would be reasonably ascertainable by the time the investigation and prosecution was complete, on July 8, 2004. In any event, the claim provides no basis to find that claimant sustained damages after July 2004 with respect to this cause of action. Thus, because these four claims accrued, at the latest, in July 2004, the notice of intention, served in October 2009, was untimely, and the Court lacks jurisdiction to consider them.
The Court is unpersuaded by claimant's assertion that these causes of action accrued, instead, on October 2, 2009. Upon review, the Court finds that the letter upon which claimant relies does not establish that no Executive Law § 63 (3) referral letters ever existed or that the Attorney General's Office has perpetrated a fraud regarding the letters (Claim, Appendix, Exhibit R-14). The October 2009 letter was written in response to one of claimant's numerous Freedom of Information Law (hereinafter FOIL) requests to the Banking Department regarding the referral letters and establishes, at most, that a search of the Department's transfer lists and indexes of records which have been destroyed or disposed of, or which are scheduled to be destroyed or disposed of, did not reveal any references to claimant or William Zuga, the individual identified in the 1997 referral letter. The Court has also carefully reviewed the other documents submitted by claimant in support of the claim and finds nothing therein supporting claimant's contention that it has been established that the two referral letters are not authentic. The Court also rejects claimant's contention that the time requirements should be equitably tolled in light of defendant's alleged fraud and misrepresentation, where claimant has not alleged that he was "induced by fraud, misrepresentations or deception to refrain from filing a timely action" with respect to these causes of action (Simcuski v Saeli, 44 NY2d 442, 449 [1978]; see Putter v North Shore Univ. Hosp., 7 NY3d 548, 552-553 [2006]). In any event, even assuming that these four claims, which allege intentional torts, accrued in October 2009 as claimant asserts, the claim was not filed with the Court within one year of that date and is untimely for that reason (see Court of Claims Act § 10 [3-b]).
II. Fifth Cause of Action
Finally, in his fifth cause of action, claimant alleges that, from October 2002 until July 2011, the Attorney General deliberately misrepresented to numerous courts - including Dutchess County Court, the Appellate Division, Second and Third Departments, the Court of Appeals and two federal courts - that it was in possession of the two referral letters establishing the Attorney General's jurisdiction in claimant's case and willfully concealed evidence that the Attorney General was without authority to investigate and prosecute claimant (Claim ¶¶ 98-99). To the extent that this cause of action alleges a series of ongoing unlawful acts by defendant continuing until the time of the filing of the claim, the continuing violation doctrine effectively tolls the Court of Claims Act § 10 limitations period until the date of the commission of the last alleged wrongful act (see Selkirk v State of New York, 249 AD2d 818, 819 [1998]; see also Bullard v State of New York, 307 AD2d 676, 678 [2003]; Commack Self-Serv. Kosher Meats v State of New York, 270 AD2d 687, 688 [2000]), and the Court declines to dismiss this cause of action as untimely.
Nevertheless, the Court concludes that the fifth cause of action must be dismissed for failure to state a cause of action. In considering a motion to dismiss for failure to state a cause of action, the inquiry before the Court is "'whether the facts as alleged in the claim fit within any cognizable legal theory'" (Justice v State of New York, 66 AD3d 1182, 1183 [2009], quoting Leon v Martinez, 84 NY2d 83, 87-88; see IMS Engrs. -Architects, P.C. v State of New York, 51 AD3d 1355, 1356 [2008]; lv denied 11 NY3d 706 [2008]). The Court must liberally construe the claim, assume claimant's allegations to be true and afford claimant the benefit of "every favorable inference" (Trump on the Ocean, LLC v State of New York, 79 AD3d 1325,1326 [2010], lv dismissed and lv denied 17 NY3d 770 [2011]; see Leon v Martinez, 84 NY2d at 87-88), although "bare legal conclusions as well as factual claims flatly contradicted by the record are not entitled to any such consideration" (Mayer v Sanders, 264 AD2d 827, 828 [1999]; see Berman v Christ Apostolic Church Intl. Miracle Center, Inc., 87 AD3d 1094, 1095 [2011]). "In order to set forth a cause of action in fraud, there must be allegations of a representation of a material fact, the falsity of that representation, knowledge by the party who made the representation that it was false when made, justifiable reliance by plaintiff and resulting injury" (Monaco v New York Univ. Med. Ctr., 213 AD2d 167, 169 [1995], lv dismissed and lv denied 86 NY2d 882 [1995]; see Lama Holding Co. v Smith Barney, 88 NY2d 413, 421 [1996]; Colasacco v Robert E. Lawrence Real Estate, 68 AD3d 706, 708 [2009]). The elements of this cause of action must be pleaded with specificity (see CPLR 3016 [b]; Orchid Const. Corp. v Gottbetter, 89 AD3d 708, 710-711 [2011]), and conclusory allegations are insufficient to state a cause of action for fraud (see Greschler v Greschler, 51 NY2d 368, 375 [1980]).
Here, the crux of claimant's allegations of fraud is that the two Executive Law § 63 (3) referral letters that are in his possession are inauthentic. However, claimant has failed to allege any basis in fact for this allegation, and the Court finds that it is speculative and conclusory at best. In the Court's view, nothing in the materials submitted by claimant calls into the question the authenticity of these letters or the Attorney General's jurisdiction to investigate and prosecute claimant. Thus, the claim contains no " 'factually supported allegation' of misrepresentation" (Matter of HSBC Bank U.S.A. [Littleton], 70 AD3d 1324, 1325 [2010], lv denied 14 NY3d 710 [2010], quoting Pope v Saget, 29 AD3d 437, 441 [2006], lv denied 8 NY3d 803 [2007]). Moreover, claimant does not allege that he justifiably relied upon the alleged misrepresentations or concealment during the various legal proceedings, and it is clear from the face of the claim that, since his arrest in 2002, claimant has never relied upon any assertions made by defendant. As such, claimant has failed to state a cause of action sounding in fraud.
Based upon the foregoing, it is ORDERED that claimant's motion to strike defendant's cross motion, M-80596, is DENIED, defendant's cross motion to dismiss the claim, CM-80542, is GRANTED and Claim No. 120197 is dismissed. Claimant's motion seeking discovery, M-80424, is DENIED as moot. Any pending requests or motions not specifically addressed by the Court in this decision are hereby denied.
March 30, 2012
Albany, New York
James H. Ferreira
Judge of the Court of Claims
Papers Considered:
1. Claim filed August 5, 2011 and supporting exhibits and appendices attached thereto;
2. Verified Answer filed September 2, 2011;
3. Claimant's Notice of Motion dated August 25, 2011 and supporting papers and exhibits attached thereto;
4. Defendant's Notice of Cross Motion and Affirmation in Opposition to Claimant's Motion dated October 21, 2011 and supporting papers and exhibits attached thereto;
5. Claimant's Motion to Strike Defendant's Cross Motion dated November 1, 2011 and supporting papers and exhibits attached thereto;
6. Defendant's Affirmation in Opposition to Claimant's Motion to Strike dated December 9, 2011 and supporting papers and exhibits attached thereto; and
7. Claimant's Response to Defendant's Affirmation and Opposition to Defendant's Cross Motion dated December 21, 2011.