Court Opinion

ID: 5895327
Source: CourtListenerOpinion
Date Created: 2022-01-13 03:02:50.744486+00
Date Added: 2024-06-11T08:45:28.829383
License: Public Domain

Ellerin, J. (dissenting in part).
Plaintiff brings this action against his former employer, defendant Port Authority of New York and New Jersey, for wrongful discharge, asserting that after almost 15 years of service as a tenured, permanent employee, he was initially forced to relinquish his tenured status, and, thereafter, was coerced into resigning. Despite a finding by the State Unemployment Insurance Administrative Law Judge that plaintiffs resignation was not voluntary but was "under pressure from the employer”, a finding which was made after a hearing at which the defendant employer actively participated and which was affirmed upon administrative appeal, Special Term granted summary judgment dismissing the complaint in its entirety on the ground that plaintiff had freely waived his rights. In my view, such summary disposition was inappropriate under the facts here present with respect to the first and fourth causes of action and, accordingly, I would reverse and deny the defendant’s motion for summary judgment as to those two causes of action and, in addition, would grant summary judgment to the plaintiff on the first cause of action.
Plaintiff Ralph A. Faillace, with an educational background that included a Bachelor’s degree in Business Administration in Real Estate and a Master’s degree in Business Administration in Finance, entered the defendant Port Authority’s employ in December 1967 in a middle management position in its Real Estate Department after having had 17 years of experience in private industry. In 1974, the Port Authority’s Real Estate Department was abolished and plaintiff was "excessed” and assigned to the Management Services Department as a senior property representative. Thereafter, in 1979, as part of a further personnel reorganization, plaintiffs position was abolished and he was assigned to the World Trade Department.
Throughout this period of service, plaintiff enjoyed the status of a tenured, "permanent employee” by virtue of the defendant’s long-standing policy as set forth in its "General Resolution 76”, adopted in 1941. Pursuant to that policy, one *45who is continuously employed by the Port Authority for a period of more than one year obtains tenure, and as a "permanent employee” cannot be dismissed except for good cause. Port Authority regulation PAI 20-1.11, delineates the procedure for removal of professional and managerial employees for "cause”, including the right to notice and a hearing.
After plaintiffs assignment to the World Trade Department in 1979, his supervisors indicated that they were unhappy with his performance. While defendant makes much of its claim that plaintiff admitted that his performance was poor, it appears from the record that plaintiff merely acknowledged, in response to questioning, that he had accumulated a backlog of paperwork attributable to his unfamiliarity with this new department, but that he did not admit to "difficulties in performing his work”. In any event, plaintiff asserts that plaintiffs supervisors threatened to terminate his employment forthwith, place a bad report in his personnel file and give poor references for future employment unless he agreed to resign his permanent employment position, for which he had obtained tenure. It was in the face of this threat that plaintiff, on October 10, 1980, signed the resignation offered him. Under this resignation document, plaintiff forfeited his tenure as a "permanent employee” and waived all rights he would be due pursuant to PAI 20-1.11. In exchange, he was given a "temporary” employment position, without rights of tenure, in the Regional Development Division of the Planning and Development Department for a period of six months commencing October 27, 1980, at the end of which period he was to resign if not otherwise permanently placed. Included in this agreement were vague promises of assistance in securing a new permanent position in another division of the Port Authority, assistance which does not appear to have been rendered.
On May 1, 1981, Mr. Faillace, again under threats of immediate termination, was forced to sign a similar resignation agreement, this time setting a resignation date of February 19, 1982, continuing a waiver of his rights, and assigning him a temporary employment position in defendant’s Tunnels, Bridges and Terminals Department. This agreement purported to give plaintiff time off to pursue and secure other employment, but in fact, he was given no time off, and, again, was denied the promised assistance in obtaining another position within the Port Authority.
Prior to the effective date specified for his resignation, plaintiff came to the belief that the agreements were illegal *46and the result of fraud and duress, and he attempted to rescind his resignation by letter dated January 20, 1982. In that letter, plaintiff advised the Port Authority that an appropriate permanent position within the Tunnels, Bridges and Terminals Division was available in the area of work he was already performing satisfactorily.
The Port Authority rejected this "rescission” and the resignation was put into effect on February 19, 1982.
Thereafter, when plaintiff applied for unemployment insurance, the defendant Port Authority objected on the ground that plaintiff voluntarily left his employment without good cause. A hearing was conducted on this issue before Unemployment Insurance Administrative Law Judge Albert Einstein on June 25, 1982. At that hearing William Peterman, principal insurance analyst for the Port Authority Personnel Department, and Richard Peduto, assistant manager of management personnel, appeared on behalf of the Port Authority, and testified at length with the opportunity to fully address all relevant issues regarding the plaintiff’s termination from the defendant agency.
After considering the evidence adduced at this hearing, the Administrative Law Judge denied the Port Authority’s objections and sustained Faillace’s eligibility for unemployment insurance benefits based upon the following opinion: "The credible evidence adduced at the hearing established that claimant was terminated when he resigned February 19, 1982 under pressure from the employer. As early as January 20, and January 21, claimant sought to withdraw his resignation but this was not accepted by the employer. Claimant’s various transfers effected by the employer put him in a position where he wound up not being able to perform duties to the employer’s satisfaction and the employer therefore requesting a resignation. I find that the termination under these circumstances was non-disqualifying and claimant was entitled to unemployment insurance benefits.” This decision, which was appealed by the defendant Port Authority, was affirmed by the Appeal Board on November 4, 1982.
The instant action was commenced on or about February 18, 1982, almost contemporaneous with the February 19, 1982 termination date. In October 1983, leave was granted to serve the amended complaint here in issue which pleads four causes of action. The first cause of action alleges a violation of plaintiff’s due process rights by virtue of defendant’s failure to *47provide him a hearing pursuant to the defendant agency’s own rules; the second cause of action alleges a prima facie tort; the third pleads a breach of contract; and the fourth cause charges age discrimination in violation of Executive Law § 296.
Thereafter, plaintiff moved for summary judgment on the first cause of action in the amended complaint, asserting that under the rules of collateral estoppel the finding in the administrative proceeding that "he resigned * * * under pressure from the employer” conclusively established that his "resignation”, with its "waiver of rights”, was not voluntary and was, therefore, invalid, with the consequence that he remained a tenured employee and, as such, was entitled to the notice and hearing procedures mandated by defendant’s rules in the case of such an employee, which concededly were not met here.
Defendant cross-moved for summary judgment dismissing the complaint for failure to state a cause of action, and alternatively, to dismiss the second through fourth causes of action on the procedural grounds of failure to file a notice of claim.
Special Term focused on the issue of the validity of the initial document, dated October 10, 1980, which provided for plaintiff’s resignation and a waiver of his rights and the court consistently characterized that agreement solely as "the waiver” and couched the issue as "validity of the waiver”. Notwithstanding the contradictory factual allegations in plaintiffs papers, Special Term made a conclusive finding that the waiver was freely entered into and valid, and granted defendant’s cross motion dismissing the complaint. In so doing, Special Term summarily dismissed the administrative finding "that plaintiffs termination was not voluntary and that he was entitled to benefits” as "not the issue before this Court”. The court took the position that the ruling that the resignation was involuntary was of no relevance on the issue of whether plaintiffs waiver of rights was involuntary.
Special Term appears to have isolated the "waiver provision” and treated it as a completely separate and discrete agreement unrelated to the mandatory resignation provision in the very same document. That document itself, however, makes clear that the waiver of rights was part and parcel of the very resignation agreement that plaintiff was found to have been pressured into signing. It is difficult to perceive how *48the two provisions in a single document, signed as a single entity, can be treated differently in terms of the state of mind of the party who allegedly entered into the agreement and signed that document. Either plaintiff entered into the entire arrangement freely and voluntarily or the entire agreement was involuntarily induced. It cannot be viewed piecemeal.
Here, the Administrative Law Judge, while specifically concerned with the issue of plaintiff’s termination, found that plaintiff’s acquiescence in the agreement which provided for his resignation was not voluntary. That determination as to involuntariness necessarily extends to the remaining provisions of the agreement which were inexorably intertwined with the termination provision.
It is now clear that the doctrines of res judicata and collateral estoppel are applicable to give conclusive effect to the quasi-judicial determinations of administrative agencies. (Ryan v New York Tel. Co., 62 NY2d 494.) Under collateral estoppel a party is precluded from litigating in a subsequent action or proceeding an issue clearly raised in a prior action or proceeding, and material thereto, and decided against that party, whether or not the tribunal or causes of action are the same (e.g., Ripley v Storer, 309 NY 506). In the application of collateral estoppel with respect to administrative determinations, the burden rests on the proponent to demonstrate the identicality and decisiveness of the issue, while the burden rests upon the opponent to establish the absence of a full and fair opportunity to litigate the issue in the prior action or proceeding. (Ryan v New York Tel. Co., supra, at 501.)
In this case, it was clearly established that the issue decided at the administrative proceeding was directly material and controlling upon the issue sought to be precluded here. (The defendant does not raise any issue with respect to its full and fair opportunity to litigate the matter at the administrative proceeding.) The precise issue before the unemployment insurance proceeding was whether the termination of plaintiff’s employment, as expressed through the resignation he signed, was voluntary. The administrative hearing fully explored the circumstances leading up to plaintiff’s resignation and a finding was made that plaintiff was involuntarily pressured into resigning. The terms and conditions of that resignation, which plaintiff was found to have signed involuntarily, were held invalid.
That is the same material issue which is raised here. As the *49defendant repeatedly asserts, a tenured public employee may waive significant rights appurtenant to that tenure, so long as the waiver is freely, knowingly, and openly arrived at, without taint of coercion or duress. (Matter of Abramovich v Board of Educ., 46 NY2d 450, cert denied 444 US 845; see also, Matter of American Broadcasting Cos. v Roberts, 61 NY2d 244; Matter of Feinerman v Board of Coop. Educ. Servs., 48 NY2d 491.) Accordingly, the crucial issue in the matter before us, as in the hearing before the Administrative Law Judge, is whether the plaintiff was under taint of coercion or duress when he signed the resignation agreement which included the waiver of his rights under PAI 20-1.11.
In order to obtain his reassignment to the Regional Development Division of the Planning and Development Department, plaintiff was compelled by the defendant to tender his resignation and waive his rights. He was threatened by Port Authority management personnel that unless he signed the waiver his employment would be terminated forthwith and he would receive a bad report in his personnel record and poor references for future employment. As Mr. Faillace graphically testified at the hearing, "I was told at that time by [Senior Personnel Representative] Curcuruto 'you have no choice; it is either sign it or they will commence termination proceedings’.”
Clearly, under circumstances such as these, plaintiff did not sign the resignation and waiver of rights under his own free will. Contrary to the defendant’s contention, its threats to terminate plaintiff did not merely advise him of acts it was legally entitled to do. Had plaintiff remained under tenure, he could not have been terminated at will. Nor is it persuasive that plaintiff received a benefit, in the form of one additional year of temporary employment. The earned right of tenure and continued employment is too significant a benefit to be traded away for a brief period of temporary work and an empty promise of assistance in securing a permanent position. Clearly, it must be said that under such circumstances petitioner signed the waiver under taint of duress and coercion. As was stated in Gerstein v 532 Broad Hollow Rd. Co. (75 AD2d 292, 297), "[d]uress * * * may be said to exist where one is compelled to perform an act which he has the legal right to abstain from performing. The compulsion must be such as to overcome the exercise of free will * * * It must 'involve an act or a threat of action from which the person sought to be influenced is entitled to be free’ ”.
*50Since plaintiff did not validly waive his right to tenure, he retained a constitutionally protected property interest in his continued public employment. Plaintiffs property interest, in his employment with the Port Authority was created and defined by the terms of his employment. (Board of Regents v Roth, 408 US 564, 577-578.) The rules and understandings, such as the General Resoultion of 1941, establishing tenure and permanence, and PAI 20-1.11 setting forth the procedure for a hearing prior to dismissal for cause, secure for plaintiff the legal entitlement to such benefits (supra). The Supreme Court has recently reaffirmed the significance of the constitutional property interest in employment for nonprobationary public employees who by statute or rule could be fired only for cause. (Cleveland Bd. of Educ. v Loudermill, 470 US 532.) The Supreme Court explicitly stated that the Due Process Clause provides that the substantive rights of life, liberty and property cannot be deprived except pursuant to constitutionally adequate procedures. Once a property interest in public employment is conferred, as it is here by the Port Authority tenure rules, it may not be deprived without appropriate procedural safeguards (supra, at 541).
Plaintiff, not having waived his rights as a tenured employee, could not be dismissed without being accorded the hearing he was entitled to under the defendant’s own rules. Accordingly, plaintiff is entitled to summary judgment on his first cause of action, alleging a deprivation of due process, and the grant of summary judgment to the defendant on that cause of action should be reversed.
I agree that the second and third causes of action must be dismissed for the failure of the plaintiff to serve a notice of claim pursuant to the holding in Mills v County of Monroe (59 NY2d 307).
However, plaintiff’s fourth cause of action, asserting age discrimination should not have been summarily dismissed. Plaintiff’s papers made out a prima facie case. He demonstrated that, being over 50 years of age, he was a member of the protected class, that he was discharged, that he was qualified for the position held, and that he was replaced by a younger person. (See, Mayer v Manton Cork Corp., 126 AD2d 526.) For the defendant to succeed on its summary judgment motion, it had the burden of setting forth evidentiary facts to establish its defense as a matter of law (supra). Here, the defendant’s claim is that plaintiff’s performance was unsatisfactory. However, plaintiff has not yet had a hearing on this *51issue. Despite the conclusory allegations of the affidavits submitted by defendant, issues of fact as to Faillace’s job performance are yet to be determined and summary judgment is, therefore, inappropriate. Similarly, defendant’s assertion that plaintiffs replacement, a Mr. Rossi, is a "few years younger” than plaintiff but in the same senior pension system, is an issue of fact which must await trial. Accordingly, dismissal of the fourth cause of action should be reversed and defendant’s motion for summary judgment with respect to that cause of action denied.
Murphy, P. J., Asch and Rosenberger, JJ., concur with Ross, J.; Ellerin, J., dissents in part in an opinion.
Order and judgment (one paper), Supreme Court, New York County, entered on or about May 13, 1986, affirmed, without costs and without disbursements.