Merritt v Defedericis
Annotate this CaseDecided on July 1, 2005
Supreme Court, Nassau County
RICHARD MERRITT, Plaintiff,
against
DANIEL DEFEDERICIS, as President of the Association of the New York State Troopers, Inc. & The Police Benevolent Association of the New York State Troopers, Inc., Defendants
004183-03
Richard J. Merritt, Esq.
Pro se Plaintiff
2 Birs Avenue
Lindenhurst, NY 11757
Clay J. Lodovice
Gleason, Dunn, Walsh & O'Shea
Attorneys for Defendant
40 Beaver Street
Albany, NY 12207
Lawrence J. Brennan, J.
In this proceeding, the Court must interpret three prior decisions of three different justices of this court, each of which addressed aspects of the underlying issues herein.
This litigation involves an alleged breach of contract in which the pro se plaintiff, Richard Merritt, an attorney, claims that the defendants Daniel Defedericis, as President of the Association of the New York State Troopers, Inc., and The Police Benevolent Association of the New York State Troopers, Inc., (hereinafter referred to as NYSPBA) failed to pay a portion of his legal fees after they had retained him to represent a then-New York State Trooper, Steven Telano, in a disciplinary matter arising from both on-duty and off-duty conduct.
The plaintiff's complaint alleges that the defendants refused to compensate him for agreed-upon legal services, after submission of his bill, together with relevant time sheets. The defendants allege that they sent him a $5,000 check with an accompanying letter that this amount reflected a final full accord and satisfaction. It is undisputed that no such endorsement or language appeared on either side of the check.
The defendant moved to dismiss the plaintiff's complaint alleging that full payment had been made by way of a final payment letter dated March 16, 2001. Discovery, which included depositions and document discovery, was completed. Thereafter, the Court set the matter down for a hearing. [*2]After a limited two day hearing on a motion to dismiss, Justice Ira Raab issued a bench Decision on June 30, 2003 [see: Trial Transcript Pages 62-65] which is the first judicial determination to which this Court is bound by way of the "law of the case" rule. The basis for the law of the case doctrine is to have a trial court judge's ruling be the final statement in a matter based on the context in which the ruling was made as well as the nature of the ruling itself. People v. Evans, 94 NY2d 499 (2000).
In that Decision, Justice Raab reviewed the pleadings, assessed the credibility of the witnesses and presented evidence. He determined that the defendant had never mailed to the plaintiff the unsigned final payment letter dated March 16, 2001. [see June 30, 2003, trial transcript at pages 65:5 - 25 to 66: 2-4]. Justice Raab ordered that the Minutes of that part of the transcript which constituted the Order of the Court in denying the defendant's motion to dismiss.
Thereafter, on September 22, 2003, the defendants moved to renew based on allegedly new discovered evidence which could not have reasonably been discovered prior to the aforesaid hearing. The motion was made nearly three months after Justice Raab's June 23, 2003, bench Decision. Judge Raab left the Supreme Court bench before deciding the September 22, 2003 motion to renew his June 30, 2003 decision.
After review of the defendant's motion papers and plaintiff's affirmation in opposition concerning the renewal, Justice Peter B. Skelos, (before being appointed to the Appellate Division, Second Department) issued a Decision on December 10, 2003, the second Decision to which this Court is bound. In relevant part, he held that with respect to the accord and satisfaction letter, "... Significantly what remains undetermined even in light of the new evidence is whether the letter of March 16, 2001 actually accompanied the check of same date. The hearing transcript contains arguments as to why the letter was not signed, and what the customary mailing practice of the PBA office was, but is silent on the threshold issue of when and if the letter was actually received by the plaintiff. This remains to be determined."
Thereafter, on July 9, 2004, the third judicial decision to which this Court is bound by Justice Robert Roberto, Jr., the newly-appointed IAS Judge, determined that this matter should proceed to a further hearing "... Upon a review of Justice Skelos's Decision, by which it is bound, the Court finds that these issues were whether the check to the plaintiff dated March 16, 2001 was created on that date, or on March 15, 2001, and "when and if" the letter indicating that this check represented final payment for the legal services at issue was received by the plaintiff ..."
The hearing before this Court commenced on February 2, 2005, and concluded on March 17, 2005.
This Court has reviewed the relevant prior Decisions (i.e. those of Justice Ira Raab, Justice Peter B. Skelos, and Justice Robert Roberto). Justice Raab's bench Decision, the first of these, determine that the letter had neither been mailed nor delivered to the plaintiff and did not accompany the check.
Justice Skelos determined in his December 10, 2003 Order, which decided the renewal motion herein, that the parties shall initially proceed to hearing on the issue of whether there was an accord and satisfaction outside the letter. However, he was unable to direct a "framed issue hearing" because of his appointment to the Appellate Division, Second Department.
Justice Roberto's Decision, "... upon a certification conference held with counsel, and upon its own motion ..." determined that Justice Skelos's December 10, 2003, Decision, "... by which it [*3]is bound...", found that the issues for a framed hearing were "... whether the check to the plaintiff dated March 16, 2001, was created on that date, or on March 15, 2001, and 'when and if' the letter indicating that this check represented final payment for the legal services at issue was received by the plaintiff..."
The dilemma faced by this Court is that Justice Raab, in his bench Decision, [see trial transcript, supra] had already carefully assessed the credibility of the defendants' witnesses and determined that no such accord and satisfaction letter was delivered to the plaintiff. Reading the three previous decisions together, this Court finds that the issue to be resolved is whether there can be gleaned from the March 16, 2001 letter an intent to be the final payment from the conduct of the parties, in the absence of a signed or delivered letter. In the alternative the amount of plaintiff's claim for legal fees is still before this Court.
This Court had asked defendant's counsel for an offer of proof concerning the relevance of the date of the check's creation. No factual issues were proferred to demonstrate its materiality. Indeed, the only relevant credible evidence is proof of the letter's mailing or its delivery with the $5,000.00 check, which eventually was deposited by the plaintiff. There is no dispute that the check alone, regardless of its date, was hand-delivered to the plaintiff's office in Lindenhurst, New York in a sealed envelope.
Therefore, in view of the inability of Defendant's counsel to satisfactorily provide the Court with an offer of proof demonstrating the relevancy of testimony concerning when the check was drafted, that branch of the hearing referred to in Justice Skelos's Decision was deemed moot and unnecessary by this Court.
This Court determined that the "framed issue hearing", referred to by both Justice Skelos and Justice Roberto, was limited to allowing relevant testimony as to whether he had received the alleged letter.
This Court permitted additional testimony by both defendant and plaintiff to further amplify the purported delivery of the letter together with the $5,000 check.
The plaintiff's sister-in-law, Virginia DiLorenzo, testified that at the time period in question she would frequently come in on weekends to straighten up the plaintiff's office. This was the first floor of a renovated private home in Lindenhurst, New York. She has no legal training.
She would take the mail which normally was in a mailbox on a stand next to the front door of the house. In the case of this letter, it was on the floor inside the house approximately one foot from the front door.
Her normal practice was to open his mail. If there was a check in any envelope, she would prepare a deposit slip and a memo concerning each such check on the plaintiff's computer. She would then leave the check, a completed deposit slip, the memo, any correspondence enclosed, and the envelope on the plaintiff's desk. The original memo concerning this check, signed in blue ink, was marked in evidence. [Plaintiff's Exh. 2.] There was only a check inside this envelope. Therefore, she left only her memo, the check, the deposit slip, and the empty envelope for the plaintiff on his desk. [*4]
Cross-examination revealed that the witness, Virginia DiLorenzo, was not a trained paralegal and had stopped helping the plaintiff on a regular basis when she later obtained a new job in Brooklyn. She was not paid for her services.
She remembered that the envelope had a PBA name, logo and address, but could not be very clear about it. However, she looked inside the envelope and was absolutely sure that there was no letter enclosed. She recalled that the envelope had no postage, was under the door and was not inside the standing mailbox at the entry door. She had a clear recollection of having prepared the memo to the plaintiff on that Sunday, March 18, 2001. This distinct memory was because the next day, March 19, 2001, was St. Joseph's Day and it was the last such day she ever spent with her mother, who is now deceased. The witness was able to produce the original memo from the storage area for old files in the basement approximately one year ago, when Mr. Merritt asked her to look for it.
The Court finds this witness to be an extremely credible, reliable and truthful in the recitation of events and documentation.
The pro se plaintiff, Richard Merritt also testified that he came in to his office on Monday, March 19 , 2001, and found a $5,000 check, together with an envelope and a deposit slip for his account at the Dime Savings Bank. His custom and practice was to discard envelopes without letters or notes, whereas he would staple an envelope to any note or letter if one had been included in an enveope. There was no letter accompanying the check, envelope and deposit slip; accordingly, he did not keep the envelope.
The plaintiff testified that the custom and practice of the defendants, for the year and one-half he had performed legal services for them, was to send payment checks in envelopes, which were rarely accompanied by letters. Thus, he was not surprised that only the check had been in the envelope.
He explained that there was no prior indication, oral or written, that defendants did not intend to pay his bill or that they would send him a lesser payment as a final accord and satisfaction concerning his final submitted bill. He did ask his sister-in-law, the witness Virginia DiLorenzo, about whether she ever saw a letter in the envelope with the check. She told him there was none.
Cross-examination of the plaintiff revealed no inconsistences with the plaintiff's version of events.
This Court found the plaintiff to be highly credible and fully worthy of belief. Indeed, in reviewing the motion papers at bar, Mr. Merritt discussed the amount of time involved in his representation of Mr. Telano, including many hours of telephone calls which he affirmed had not even been billed to the defendants. [*5]
In searching the record, the Court notes that there was no specific rejection by defendant's counsel of Mr. Merritt's statements referred to in the plaintiff's April 30, 2003 Affirmation in Opposition to the Motion to Dismiss.
The defendant called Ms. Kelly Miller, an eight year employee of the defendant, PBA, to testify with respect to some of her duties.
She maintains the phone bills. Placed in evidence over objection of the plaintiff was a telephone bill which related to the time period from February 2, 2001 to March 16, 2001. It reflected both a fifty minute and one minute telephone calls to the plaintiff's office on March 16, 2001. [Defendant's Exh. C]
Voir dire by the plaintiff concerning this document had revealed that the witness had no knowledge of who called from the PBA office to the plaintiff's office in Lindenhurst that day, or if indeed anyone had spoken with Mr. Merritt personally. Further questioning revealed that the witness was familiar with the fact that many former PBA officers utilized the plaintiff's office as a courtesy.
The Court finds that Ms. Miller was a generally credible witness; however, her testimony was in no way relevant, probative or material inasmuch as the telephone calls were irrelevant to the issues this Court seeks to determine. She had no knowledge about the alleged letter at issue or any information about its preparation, mailing or delivery. Moreover, in view of the fact that she accompanied the office manager, Caryl Ehrhardt, and the defendant, Daniel Defedericis, down from Albany on two occasions for this hearing, the Court found it very difficult to accept that there was no discussions with them about the March 16, 2001 final payment letter.
The Court has carefully reviewed Ms. Miller's September 16, 2003, three page Affidavit in Support of the Motion for Leave to renew, which resulted in part in the hearing before this Court.
It is absolutely silent on the relevant issue herein, that being whether the final payment letter was delivered to the plaintiff with the $5,000 check.
Thus, in assessing Ms. Miller's Affidavit and her testimony before this Court on February 2, 2005, and the defendants response to this Court's directive for an offer of proof, the defendants have provided no evidence whatsoever as to the relevance of the actual date of the check as dispositive of plaintiff's case.
The defendants also called Caryl Erhardt [D/B: October 25, 1948] upon their behalf. She is the office manager and has been employed by the New York State PBA for thirty two years.
She is married to John Caufield, former NYSPBA president, who retired from the NYSPBA in June 1993 and now works for the NYS Department of Labor. [*6]Introduced into evidence was the alleged March 16, 2001 "final payment" letter, the critical document at issue in this case. [Defendant's Exh. B] She drafted this on her office computer at the direction of Thomas Pomeroy, the then-treasurer of the defendant NYSPBA.
Of great significance was her testimony that this termination letter was unsigned when sent in an envelope with the check. The text of the letter noted the authority of the Executive Board. Later cross-examination revealed that no such entity as the Executive Board exists in the By Laws of the NYSPBA.
She indicated that she personally placed the unsigned final payment letter and check in an envelope to go with the mail ready to go through the postage machine and then be mailed. The actual mailing could have been done by her, Kelly or Arnie. The witness was certain she never gave this envelope with the check and letter to Steven Telano. The check, according to the computer which prints out the checks, was not entered until March 16, 2001.
Cross-examination revealed that Caryl Erhardt was very defensive concerning the circumstances of drafting the final payment letter and printing the check, which significantly impaired her credibility. When questioned about who instructed her to write the final payment letter, she was clear that it was at the direction of her boss, Mr. Pomeroy. However, her earlier testimony was that the entire board, in other words the seventeen members present at the Board Meeting that day, told her to send the letter. She admitted that for her to be asked to type this final payment letter was unusual and out of the ordinary.
The March 2001 "NYSPBA By Laws" were placed in evidence by the plaintiff. There is no provision for an "Executive Board" therein [Plaintiff's Exhibit 7 - (20 pages)].
Further cross-examination of Ms. Erhardt revealed that Steven Telano, the plaintiff's witness, had been involved with some litigation arising from a NYSPBA controversy with Mr. Caufield, who is now married to the witness.
The Court found Mrs. Ehrhardt to be a defensive witness, who is not credible or worthy of belief on the issues presented herein. In making this evaluation, the Court has not relied on any prior observation or characterization of her prior testimony by then-Justice Ira Raab, who presided over the initial hearing in June 2003.
The defendants also called Don Postles [D/B: January 13, 1965]. He is currently the First Vice President and Executive Director of the NYSPBA and has been a New York State Trooper for sixteen years. Don Postles worked closely with the Plaintiff Merritt on both the Telano litigation and the disciplinary hearing, which [*7]partially involved off-duty conduct of then-Trooper Steven Telano.
Mr. Merritt had been retained by former NYSPBA President Al Wohlford and Mr. Postles; thereafter Mr. Merritt met with the entire NYSPBA Board of Directors. The January 16, 2001 $5,000 retainer agreement with the NYSPBA was introduced in evidence. [Plaintiff's Exhibit 10]. This exhibit clearly indicates defendant's retention of plaintiff for the Telano matter, and that the initial $5,000 was for litigation expenses to be incurred prior to the disciplinary hearing. It addresses procedures for submitting further bills.
Cross-examination demonstrated that Mr. Postles actually was present only for the last day of the Telano eight-day hearing. However, he was fully aware of its progress. Indeed, he was aware that the plaintiff, Mr. Merritt, had been representing Mr. Telano continuously for three months, which included an earlier Article 78 proceeding commenced in Supreme Court, Nassau County, well before the hearing itself.
Mr. Postles conceded that he was aware generally, without needing to look at documents or exhibits, that Mr. Merritt had expended nearly 223 hours in Mr. Telano's defense by the day of the summations in the hearing. There had been twenty-five witnesses called during the Telano disciplinary hearing.
Critical to Mr. Postle's testimony was the concession during his February 23, 2004 deposition in this litigation that at no time was Mr. Merritt told during the hearing that he would not be paid for his services. Mr. Postles was in constant communication with Mr. Merritt during the entire time of both the hearing and related litigation. Furthermore, the Board of Directors authorized Mr. Merritt to travel to Albany from his Long Island office to brief them on a number of occasions.
When he was still a NYSPBA delegate in 2001, Postle further conceded there was precedent for retention of counsel by the NYSPBA president, subject to the consent of the Board of Directors. The example cited was the Cerrone matter, where counsel was paid $300,000.00 to represent Trooper Cerrone.
The witness testified that the problem with Mr. Telano's case was that it partially involved off-duty conduct. However, Mr. Postle, in responding to the Court's questions, stated that the January 16, 2003 retainer letter to Mr. Merritt never allocated percentages of legal services towards off-duty conduct, the grievance proceeding, the Article 78 litigation, or the disciplinary hearing. The letter does not make any such distinction, and the Court finds that no such intent was intended by the defendant NYSPBA in its retention of the plaintiff as counsel to Steven Telano.
Of particular significance to the Court was the failure of defendants' counsel to make any inquiry of Mr. Postles concerning his knowledge of the circumstances [*8]surrounding the drafting of the alleged final payment letter to Mr. Merritt. Inasmuch as this witness was a delegate at the board meeting and was also vice-president during all the relevant times in question, it would logically have been expected that he would testify as to these critical aspects of the case. In this sense, his silence, or lack of testimony, can be deemed to be clearly adverse to the interest of the defendants.
In addition, the Court notes the failure of NYSPBA President Daniel Defedericis, himself a named defendant, to testify herein. The Court draws the strongest possible inference against this defendant for his failure to testify as well. The Court can draw a negative inference when a named party does not appear under these circumstances. This party bears information on a material issue, and would have been expected to provide noncumulative testimony in favor of his case. Ross v. Manhattan Chelsea Assoc., 194 AD2d 332 (2nd Dept. 1993).
Steven Telano also testified on behalf of the plaintiff. He is a retired New York State Trooper who was the subject of the administrative proceedings for which Mr. Merritt was retained by the defendant.
Mr. Telano is 44 years old and had been a state trooper from 1981 until his retirement in 2001. He exhibited in his testimony an obvious animus towards numerous former delegates and current employees of the NYSPBA .
Some of this negativity originated from his time as a delegate and from a lawsuit he filed against the NYSPBA which, from his perspective, resulted in the resignation of then NYSPBA president John Caufield. Mr. Caufield is currently married to the defendant's witness, Carol Erhardt. Interestingly, Mr. Telano testified that he had supported the defendant's witness Don Postles in Mr. Postles' successful quest to be elected union vice president.
Concerning payments to the Plaintiff Merritt, Mr. Telano, then sitting as a delegate of the NYSPBA at the board meeting in February 2001, testified that there were no fee limits set for the plaintiff's attorney's fees. At the March 15, 2001 board meeting, there was no discussion that the $5,000 check was a final payment to Mr. Merritt for his case.
Mr. Telano was certain that Carol Erhardt personally typed the $5,000 post-dated check on the office computer in his presence and used the signature stamp of the then-treasurer, Tom Pomeroy, which was kept in a locked desk. She also initialed the stamped portion and placed only the check in an envelope, which she then gave to him. He placed it in his briefcase. Mr. Telano thereafter placed the envelope with the check under the door of Mr. Merritt's office in Lindenhurst on Thursday evening.
Cross examination revealed that former NYSPBA president Al Wohlford had [*9]authorized payment of $10,000 to Mr. Merritt, based upon the plaintiff's bill submitted for $14,000 in legal fees arising from the Telano case.
When questioned further about the Board's March 2001 decision to approve the additional $5,000 payment to the plaintiff, Mr. Telano did not interpert this $5,000 to be full and final payment to Mr. Merritt. Although the Minutes of the meeting reflect an amended motion by delegate and then-secretary, Warnock, he does not believe that Mr. Warnock would have put that in the Minutes. [Defendant Exhibit G].
Additional questioning about the check registry sequence demonstrated that checks were printed sequentially, and all of them indicated they were dated the day after he had testified that he had placed the envelope under the plaintiff's door [Defendant's Exhibit D].
The Court finds that Mr. Telano was a reliable and credible witness concerning the circumstances of the payment to the plaintiff, notwithstanding his obvious residual anger towards some of his former colleagues. Certainly nothing in his direct or cross-examination revealed any awareness of the alleged authorization by the Board of Delegates to send the March 16, 2001 letter designating the $5,000 final payment to the plaintiff.
Mr. Telano's credible testimony was very clear, and indeed unrebutted, that Ms. Erhardt placed only the $5,000 check in the envelope, which she then handed to him.
The Court finds that his version of events in this critical regard is fully worthy of belief, rather than that of Ms. Erhardt.
The Court further finds that there has been no probative evidence whatsoever that the alleged letter, which purportedly accompanied the $5,000 check, was authorized by the Executive Board of the NYSBA, or that it was ever mailed, sent or delivered to the plaintiff by the NYSPBA or Ms. Erhardt.
Even assuming arguendo that the "letter" was delivered to plaintiff, the Court finds no credible evidence indicating any semblance of an accord and satisfaction in the March 16, 2001 letter from the defendant to the plaintiff. The defendant was not able to show the existence of a genuine controversy concerning plaintiff's legal work product or billing. Thus, the mere alleged delivery of a $5,000 check representing significantly less than was due him, and his subsequent deposit of the check in the routine course of business does not establish the foundation for an accord and satisfaction defense to this claim. Trans World Grocers, Inc. v. Sultana Crackers, 257 AD2d 616 (2nd Dept. 1999).
Quite simply, there is no credible evidence whatsoever that the letter was [*10]mailed or delivered to the plaintiff.
Judgment is granted to Plaintiff. The amount of the judgment and interest thereon shall be determined upon submission of a judgment on consent within 30 days of service of this order or at a hearing on August 11, 2005 to adduce factual reasons for not awarding the sum sought by plaintiff in the complaint: $29,330.00.
Should the parties need to resolve the amount of the judgment at an inquest hearing, the Court is ready to impose the sanction provisions available pursuant to 22 NYCRR § 130-1.1, if at such hearing, the testimony and documentation is deemed frivolous and vexatious.
This shall constitute the Decision and Order of this Court.
E N T E R
DATED: July 1, 2005
_____________________________
HON. LAWRENCE J. BRENNAN
Acting Supreme Court Justice
TO:
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