Court Opinion

ID: 5528824
Source: CourtListenerOpinion
Date Created: 2022-01-10 18:00:01.04051+00
Date Added: 2024-06-11T08:34:32.402304
License: Public Domain

Memorandum. The order of the Appellate Division should be modified (1) by deleting so much thereof as awarded, interest at the rate of 4% per annum; ánd (2.) reinstating the determination of Supreme Court, New York County, awarding interest at the statutory rate (General Municipal Law, § 3-a, subd. 1), and, as so modified, affirmed, without costs.
The interest sought to be recovered herein arises from a delay, dating from 1966, in payment of the principal obligation owed by the City of New York Employees’ Retirement System to the estate of Alfred Falanga. The decedent, who joined the City of New York Employees’ Retirement System in 1937, did not acquire a vested right to the 4% rate of interest on judgments and accrued claims against municipal corporations in effect July 1,1940, the implementation date of section 7 of article V of the New York Constitution, which prohibits diminishment or impairment of retirement benefits. (Cf. Title Guar. & Trust Co. v. 2846 Briggs Ave., 283 N. Y. 512; O’Brien v. Young, 95 N. Y. 428.) Within the intendment of this section, the rate of interest then in effect simply was not a “ benefit ” of the contractual relationship between the decedent and the Retirement System. (Cf. Brown v. New York State Teachers Retirement System, 25 A D 2d 344, affd. 19 N Y 2d 779.) Hence, an impairment of contract is not involved in this case.
Chief Judge Breitel and Judges Jasen, Gabrielli, Jones, Wachtler and Rabin concur Judge Stevens taking no part.
Order modified in accordance with the memorandum herein and, as so modified, affirmed, without costs.