Zatto v Great Neck Water Pollution Control Dist.

[*1] Zatto v Great Neck Water Pollution Control Dist. 2004 NY Slip Op 51324(U) Decided on August 6, 2004 Supreme Court, Nassau County Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on August 6, 2004
Supreme Court, Nassau County

VICTOR ZATTO and THE CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., A.F.S.C.M.E., LOCAL 1000, A.F.L.-C.I.O., by its LOCAL 882, Plaintiff(s),

against

GREAT NECK WATER POLLUTION CONTROL DISTRICT, THE BOARD OF COMMISSIONERS OF THE GREAT NECK WATER POLLUTION CONTROL DISTRICT and ACTING SUPERINTENDENT CHRISTOPHER MURPHY, Defendant(s).



2600/04

Kenneth A. Davis, J.

The instant action stems from plaintiff's allegation that he was wrongfully terminated without being afforded a due process hearing pursuant to Civil Service Law § 75. On June 19, 2003, plaintiff refused to perform an assigned task and shouted at his supervisor using profanity. Pursuant to Section 75 of the Civil Service Law, plaintiff was entitled to a hearing regarding any disciplinary charges that were proffered against him. Plaintiff was offered the option of entering into a Settlement Agreement in lieu of the hearing. At hearing, plaintiff could have been punished with a penalty up to and including dismissal from employment. He opted to enter into the Settlement Agreement instead. The Settlement Agreement provided that he would be [*2]suspended without pay from June 26, 2003 through July 25, 2003. After his suspension, plaintiff would return to work on a probationary status effective July 26, 2003. His probationary status would be in effect until July 25, 2005 after which he would be restored to permanent Civil Service status and entitled to all the rights of an employee with permanent status. Plaintiff entered into this Settlement Agreement voluntarily and was represented by CSEA in the matter. On October 31, 2003 plaintiff received a letter informing him that, due to his unsatisfactory service, he was being terminated from his employment with the District effective November 7, 2003. Following his termination, plaintiff filed suit claiming that the Settlement Agreement was signed by representatives of the District, Christopher Murphy (Acting Superintendent) and David Wirtz (Legal Counsel for the District), who lacked the authority to bind the District and Board; therefore, plaintiff claims, the agreement has no effect and he is entitled to a Section 75 hearing as provided for in the collective bargaining agreement and under New York State Civil Service Law.

Plaintiff alleges that Murphy is an independent contractor and as such, it is unclear that Murphy had the requisite authority because no written authority of the agent has been proven. Furthermore, plaintiff contends that the relationship between the independent contractor and the District in this case is an employer-employee subterfuge which is unlawful. The court finds plaintiff's allegations to be without merit.

There is no constitutional mandate that all services furnished or labor performed for a governmental agency must be supplied by civil servants; independent contractors can be hired. Subterfuge is found only where the independent contractor is effectively under the control of the government officials.

The fact that the duties performed by the contractor's employees are identical with certain civil service titles does not meant that the contract is in violation of the State Constitution, and the fact that government officials tell the contractor's employees where to go to do the work does not constitute such a degree of control as to invalidate the contract where the government does not fix the contractors' employees' salaries, hours, or terms of employment, and where the contractor sets hiring practices, supervises, and pays all taxes, benefits and insurance. Coxen v. Meyer, 130 AD2d 72, 518 N.Y.S.2d 158 (2nd Dept. 1987).

Where there is an allegation of subterfuge, there are factors to be considered in determining the validity of a contract between a governmental agency and a private contractor. (1) the agency may not fix salaries, although it may require certain minimum wages, (2) the agency may not fix the hours of employment of individual employees, (3) the agency may not control the terms and conditions of employment although it may, [*3]and should, detail the services that must be performed and the frequency of performance, (4) the agency may not control the hiring practices of the contractor, although it may require the hiring of licensed persons where necessary and that there be affirmative action in hiring minorities, (5) the contractor must supply his own supervision, and (6) the contractor must be responsible for the payment of all pension and welfare benefits, taxes and insurance pertaining to its employees. These factors were adopted and applied by the Court of Appeals in Matter of Nassau Educ. Ch. v. Great Neck Union Free School Dist., 52 NY2d 658. Coxen v. Meyer at 76.

In the present action, plaintiff has failed to allege any of these factors which would point to the independent contractor being part of an employer-employee subterfuge.

Mr. Wirtz is Legal Counsel for the District. His purpose as legal counsel is to represent the District's interest and, as such, he has the authority to form a binding agreement on its behalf. Plaintiff fails to make any convincing argument to the contrary. Therefore, Wirtz' signature alone makes the Settlement Agreement binging.

Regarding Mr. Murphy, there is no dispute that an independent contractor may act as an agent. "One who contracts to act on behalf of another and subject to the other's control except with respect to his physical conduct is an agent and also an independent contractor." Restatement (Second) of Agency § 14N (1958). The dispute is whether Murphy was granted the authority to act as an agent and sign the Settlement Agreement on behalf of the District. The District hired Murphy to carry out its duties. Murphy was "Acting Superintendent" for the District and he and Wirtz signed the Settlement Agreement which plaintiff acknowledges was prepared by the District. The other party to a contract made by an agent for a disclosed or partially disclosed principal, acting within his authority, apparent authority or other agency power, is liable to the principal as if he had contracted directly with the principal, unless the principal is excluded as a party by the form or terms of the contract. Restatement (Second) of Agency § 292 (1958).



It is also apparent that plaintiff believed that both Murphy and Wirtz had the authority to create a binding agreement at the time of the signing and that there was a manifestation of mutual assent between the parties.

To create a binding contract, there must be a manifestation of mutual assent sufficiently definite to assure that the parties are truly in agreement with respect to all material terms. Generally, courts look to the basic elements of the offer and the acceptance to [*4]determine whether there is an objective meeting of the minds sufficient to give rise to a binding and enforceable contract. Robison v. Sweeney, 301 AD2d 815, 817, 753 N.Y.S.2d 58 (3rd Dept. 2003) quoting Matter of Express Indus. & Term. Corp. v. New York State Dept. of Transp., 93 NY2d 584, 589, 693 N.Y.S.2d 857, 715 N.E.2d 1050.

Even if both Murphy and Wirtz lacked the requisite authority, "[a] municipality may ratify a contract made on its behalf which it has the authority to make even if the contract was initially invalid due to a defective execution or because the municipal officer who purported to execute it did not have the requisite authority." Della Rocca, Jr. v. City of Schnectady, 278 AD2d 628,631, 717 N.Y.S.2d 704 (3rd Dept. 2002) quoting Imburgia v. City of New Rochelle, 223 AD2d 44, 48).



The language of the Settlement Agreement is unambiguous, and the plaintiff was represented by CSEA at the time of the signing. He accepted the Settlement Agreement in lieu of a hearing which presumptively would have resulted in a less favorable outcome for him and then proceeded to abide by the terms of the agreement. It is not until after his termination that plaintiff contested the validity of the Settlement Agreement. Thus, by his own actions, plaintiff has ratified the agreement and even if both signatories lacked the authority to create a binding agreement on behalf of the District, the agreement is still valid and binding. Section 94 of the Restatement (Second) of Agency provides: "An affirmance of an unauthorized transaction can be inferred from a failure to repudiate it" (see also, § 94, comment c ["If a third person, who has had dealings with a purported agent, reports these to the purported principal under circumstances which reasonably justify an inference of consent unless the principal discloses his dissent, the failure of the principal to dissent within a reasonable time, is, unless explained, sufficient evidence of affirmance"] and illustration 5). Of course, a principal's acceptance of benefits from a contract that was unauthorized when originally executed constitutes an affirmance of the contract that, under appropriate circumstances, will give rise to a ratification. Matter of Cologne Life Reinsurance Company v. Zurich Reinsurance, 286 AD2d 118, 126, 730 N.Y.S.2d 61 (1st Dept. 2001).

The effect of the binding Settlement Agreement is such that plaintiff no longer has a claim for a Section 75 hearing. He waived that right in exchange for the probationary status that he was granted. As a probationary employee, plaintiff was subject to automatic termination.

Given the stringent standard of review this Court is obliged to apply in termination cases of probationary employees 'a probationary employee ha[s] no right to challenge the [*5]termination by way of a hearing or otherwise, absent a showing that he was dismissed in bad faith or for an improper or impermissible reason.' Matter of Randall Davis v. New York State Div. of Military and Naval Affairs, 291 AD2d 778, 779, 738 N.Y.S.2d 719 (3rd Dept. 2002).

Therefore, the Defendant's motion to dismiss pursuant to CPLR § 3211(a)(7) is granted.

This decision constitutes the order of the court.

Dated: August 6, 2004 _________________

J.S.C.