Matter of Inglese v LiMandri

[*1] Matter of Inglese v LiMandri 2010 NY Slip Op 52136(U) [29 Misc 3d 1234(A)] Decided on October 19, 2010 Supreme Court, New York County Schlesinger, J. 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 October 19, 2010
Supreme Court, New York County

In the Matter of the Application of Louis Inglese, Jr., for a Judgment Pursuant to Article 78 of the CPLR, Petitioner,

against

Robert D. LiMandri, as Commissioner of New York City Buildings, Respondent.



107806/10



Attorney for Plaintiff

Murray Richman

2027 Williamsbridge Road

Bronx, NY 10461

718-892-8588

Defendant

Robert D. LiMandri, Commissioner

NYC DOB

280 Broadway, 7th fl.

New York, NY 10007

Alice Schlesinger, J.

Louis Inglese is 41 years of age, married with two teenage sons. He has been the main bread winner of the family. Not having graduated from high school, he became a laborer on construction sites. In 1985, he applied to become a member of Local 14 of the Operating Engineers Union and 12 years later, in 1997, he was accepted.

In 2000, he became licensed by the respondent Department of Buildings (DOB) as a hoist machine operator. It is that license, which the Commissioner of Buildings Robert LiMandri revoked in a letter to Mr. Inglese dated April 23, 2010, that is at the center of this controversy.

The facts behind the revocation and the challenge now before this Court, via an Article 78 proceeding, are not in dispute. Nor is the reason for the revocation. On September 30, 2004, in the Southern District of New York, Mr. Inglese pleaded guilty before District Judge Naomi [*2]Reice Buchwald to a violation of USC §1951, Conspiracy to Commit Extortion. The minutes of the plea allocation were later submitted to Administrative Law Judge Ingrid Addison at a hearing held at the Office of Administrative Trials and Hearings (OATH) on January 19, 2010.

The minutes reveal that Mr. Inglese admitted that he had received preferential treatment in obtaining a job as an operating engineer to run material waste at one job site, Rockefeller Institute, between November 2001 and February 2002. Petitioner was sentenced to one year and a day, the minimum sentence under the Stipulation of Sentencing Guidelines for this plea which called for 12-18 months. His sentence also included a fine of $3,000 and probation for three years following the completion of his incarceration. He served ten months, paid the fine, and completed his probation without incident.

Upon release from prison and return to work in 2005, his hoist machine license was renewed in that year and in the years following in 2006, 2007, 2008 and November 2009. (The ALJ includes this last date in her recitation of the facts). By letter dated February 23, 2009, Mr. Inglese was directed by Camie Dart, then Agency Attorney Intern, to appear at DOB's Special Investigations Unit (BSIU) "for the purpose of discussing matters relating to your Hoisting Machine Operator license." On March 24, 2009 Mr. Inglese appeared with counsel and was interviewed by Ms. Dart, along with an Investigative Attorney and a Special Inspector General from New York City Department of Investigation.

At that meeting, Ms. Inglese was told that DOB would seek to revoke his license based on this 2004 conviction.[FN1] He was also told he could surrender his license, but he declined to do that. After learning of that decision, Ms. Dart told Mr. Inglese's attorney that Inglese was "required to appear for an interview, and that such an interview would be recorded," which it was on April 21, 2009. At the interview, the questions solely concerned the conviction and acts that were its predicate.

Six months later, on October 5, 2009, DOB initiated formal proceedings to revoke petitioner's license based again solely on the federal conviction. Mr. Inglese responded by requesting a hearing before OATH to contest the proposed revocation. The hearing was held on January 19, 2010, before ALJ Addison. The allegation in DOB's petition was that due to the 2004 plea to Conspiracy to Commit Extortion, Mr. Inglese violated §26-133 of the Administrative Code (now §28-401.19) as having "poor moral character that adversely reflects on his or her fitness to conduct work regulated by this code..."

At the hearing, no witnesses testified. DOB relied exclusively in its presentation on the federal conviction and in that regard submitted the 2004 plea allocution. Mr. Inglese's sole submission was a handwritten letter from his wife, describing their family and how important her husband's work was to their sons' welfare.

On February 4, 2010 ALJ Addison issued her report and recommendation (Exh B to petition). It was eight pages and began with a brief recitation of the claim by DOB, a summary of the argument by Inglese's counsel for a penalty of something other than revocation, and the following statement: [*3]

I find that petitioner [DOB at the hearing] established that respondent [Inglese] violated section 21-133 of the Administrative Code, renumbered as Section 28-401.6. However, for the following reasons, I find that revocation is not an appropriate remedy. Instead, I recommend suspension of respondent's license for one year.

The remainder of the decision was devoted to "Analysis", "Finding and Conclusion" and 5 pages discussing her recommendation and its rationale. After the Analysis section, at the beginning of the section entitled "Finding and Conclusion", after pointing out that crimes such as bribery and extortion have supported findings of "poor moral character", the ALJ does find, based on Inglese's plea and conviction, that DOB had established that Inglese demonstrated poor moral character in violation of the applicable Administrative Code section. The poor moral character occurred "when he engaged in the criminal act of conspiracy to commit extortion, for which he pled guilty and was convicted in federal district court."

ALJ Addison, in explaining her recommendation, first reviewed other OATH findings, pointing out that criminal convictions of this type, with a few exceptions, have resulted in license revocations. She cites liberally from those exceptions, Taylor and Gelb, and shows why lesser penalties were recommended in both cases and accepted. She then points out that though good moral character is "an integral qualifier" for the issuance of a license, evaluations should be made on a "case-by-case basis", particularly because the Code gives the Commissioner the option of imposing a penalty less severe than revocation, such as a suspension or fine.

What follows then is a clear, logical, ultimately convincing justification for a recommendation of a one-year suspension. The central aspect of her analysis, a compelling one, is that DOB failed to establish that Inglese's 2004 conviction for actions occurring two years earlier adversely impacted upon his fitness to perform his job. Here she points out that in other OATH proceedings, such as Gelb, DOB did establish such a connection as they showed that trust and integrity were integral components of a master electrician's job that directly implicated public safety.

But here, the ALJ found that DOB had "presented no evidence of the job responsibilities of a hoist machine operator, or whether it required elements of integrity or trust." The ALJ also pointed to DOB's repeated renewal of Mr. Inglese's license from 2005-2009, stating that:

At no time during those years did petitioner question respondent's fitness to do his job. Nor did it allege that there were any complaints against respondent that were job-related, or that respondent had engaged in any further acts constituting poor moral character. There was no indication that respondent had not been rehabilitated, even though rehabilitation, by itself, does not divest an agency of its prerogative to seek to revoke a license where the licensee's conviction demonstrated poor moral character. ... However, revocation requires a finding that there is a direct relationship between the criminal conviction and the license sought, or that there is an unreasonable risk to the safety or welfare of the public. Even so, revocation may not be proper where the relationship between the conviction and the license sought is sufficiently attenuated.

The ALJ then proceeds to conclude that DOB failed to assert or prove a nexus between the crime Inglese pled to and his license and adds that one was not readily apparent. Here she points out, for example, that Mr. Inglese's conviction concerned work as an operating engineer, [*4]not as a hoist operator. Further, she notes that the minimum sentence of a year and a day that Inglese received (the maximum carried 20 years) was an indication that his involvement in the conspiracy was a minor one. Finally, ALJ Addison finds that the crime for which Inglese was convicted, "albeit one of moral turpitude, was sufficiently attenuated to his duties as a hoist machine operator, and neither adversely affected his duty to perform the job nor endangered public safety." Significantly, throughout her decision, the ALJ cites prior OATH decisions as precedent.

In conclusion, ALJ Addison acknowledges that, contrary to arguments made by counsel, the time lapse between Inglese's conviction and DOB's decision to revoke his license did not preclude DOB from taking action now. This is so because of the continued importance of emphasizing integrity and good behavior. Therefore, while it is proper to punish a worker in instances such as this, in part to act as a deterrent for others, the penalty must be an appropriate one. And here, the appropriate penalty was a license suspension for one year.

On April 23, 2010, Commissioner LiMandri, in a one and one-half page letter to petitioner, informed him that he had completed his review of Judge Addison's Report along with the record and transcripts (Exh A to petition). He then refers to the unrebutted evidence of Inglese's conviction. He goes on to say that while he agrees with the ALJ's finding that Inglese violated the moral character requirement of the Administrative Code, "I have determined that your conduct was sufficiently serious to warrant revocation of your license as a Hoist Machine Operator, rather than suspension as recommended by Judge Addison."

He then proceeds to discuss the two cases Taylor and Gelb cited by the ALJ, where suspension rather than revocation was chosen as a penalty, and attempts to distinguish them. Taylor merely involved an IRS offense. Gelb was commented on, in part, because of sections of the Correction Law that were used there to support the suspension decision. The crime in Gelb was two counts of mail fraud, a fraud which involved nearly $200,000 in inflated invoices. It had occurred seven years earlier. The Commissioner distinguishes Gelb and says that here, in Inglese, the Correction Law was not raised in the hearing. However, a judge is not constrained to only apply law that is cited, since applicable law is always relevant. But the Commissioner adds that the cited sections do not apply in revocation proceedings; they only apply in initial licensing. However, Gelb was, in fact, a revocation proceeding.

But getting to the core of the matter, even if sections of the Correction Law were properly alluded to in Inglese by the ALJ, the Commissioner states:

The Department of Buildings relies on the integrity and honesty of all licensees to assure public safety and it depends upon licensees to conduct their work in a code compliant and safe manner ... Your acts of receiving and providing preferential treatment for construction jobs are sufficient to establish poor moral character that adversely reflects on your fitness to hold a licensed position in the construction industry. Your age at the time of the conviction (35) and the time the crime was committed two to three years earlier; the absence of any evidence other than a letter from your spouse relating to your moral character; the seriousness of the crime and its direct relationship to and involvement in the construction industry committed soon after you received your initial HMO license all support my determination that revocation is the appropriate remedy.

One further statement by the Commissioner is worthy of note and further discussion. In [*5]the third paragraph, wherein he tells Inglese that he has determined that his conduct was sufficiently serious to warrant revocation, he refers petitioner to a decision decided after ALJ Addison made her recommendation here, that of Persico decided by ALJ Kevin Casey on April 9, 2010, wherein the ALJ recommended revocation.

Discussion

The reference to Persico, along with other aspects of the Commissioner's decision, convinces me that his determination ordering revocation is irrational, lacking in substantial evidence and arbitrary. I also find that because of these things, the penalty determined in the decision is shocking and inappropriate in its harshness.

Persico can be factually distinguished in several important ways from the instant case. For example, Persico committed mail fraud by submitting false information to a union, Local 14, to obtain wages and benefits for several jobs. His sentence was 33 months of incarceration and an agreement to pay restitution of $759,482. Thus, the crime was clearly more serious, warranting the greater penalty. Also, unlike Inglese who paid his $3,000 fine (there was no restitution ordered), Persico, in the time since his release from prison, only repaid $5,000.

But the most significant difference is that DOB, learning from the Inglese decision that had come down two months earlier, produced a significant witness at the Persico hearing. This person, Frank Damiani, a supervising inspector with DOB, testified about the responsibilities of a licensed hoist machine operator. He described the work they did and stated that in addition to the technical competence that was necessary, "hoist machine operators must take their work seriously, show up for work on time, act professionally, and possess good moral character."

Therefore, Damiani provided the necessary, in fact critical, link between poor moral character and an adverse impact upon fitness to perform the job. This DOB failed to do in the case at bar. Indeed, ALJ Addison said, "Petitioner presented no evidence of the job responsibilities of a hoist machine operator, or whether it required elements of integrity, or trust." But ALJ Casey in Persico, relying on Damiani's testimony, found "contrary to respondent's claim, there is a direct connection between his prior criminal conviction and his hoist machine operator's license".

Commissioner LiMandri, in the matter at hand, supplied the missing evidentiary link of "adverse impact" by implicitly relying on that DOB testimony given at a hearing that took place after Inglese's hearing in a wholly different case. In this way, he improperly relied on matters outside the record and by so doing, he sorely abused his discretion. Again ALJ Casey, in distinguishing his decision in Persico from ALJ Addison's decision in Inglese, emphasized that "suspension rather than revocation [was] recommended where petitioner [DOB had] offered no testimony concerning licensee's responsibilities, criminal activity was not considered major' because the licensee only received a $3,000 fine and one-year and a day incarceration, and the agency renewed the license for five successive years in which licensee repeatedly disclosed his criminal conviction." But in Persico, contrary to those facts, "petitioner offered credible evidence concerning the safety sensitive nature of respondent's work and the critical need for integrity among hoist machine operators."

The Commissioner certainly has a right to disagree and reject the recommendation of an ALJ even on matters of credibility (which was not the situation here since no testimony was [*6]given) as long as the Commissioner's action is supported by "substantial evidence". See, Mancini v. NYC Dept of Environmental Protection, 26 AD3d 178 (1st Dep't 2006)(cited by counsel for respondent). One could also argue that the Commissioner's statement that "integrity and honesty" are traits that DOB has a right to rely on for all licensees is a noncontroversial given. But there still must be substantial evidence, or in fact some evidence, presented at the hearing to show that the poor moral character indicated by the 2004 guilty plea did have an actual adverse impact on Inglese's fitness to perform his job, or in the words of the regulation §28-401.19(13): "Poor moral character that adversely reflects on his or her fitness to conduct work regulated by this code."

Even though the Commissioner has wide discretion in deciding on a penalty, he cannot abuse that discretion. I find that he did precisely that in relying on a non-existent evidentiary predicate. It does not make it any less an abuse of discretion to rely on testimony given at another later hearing, based on distinguishable facts.

I had asked counsel to brief the issue of the amount of deference, if any, that a Commissioner must give to the findings and recommendations of an ALJ who has presided at an OATH hearing. Counsel for respondent convincingly shows that subsection (e) of City Charter §1046, set forth in the City Administrative Procedure Act, makes it clear that recommendations of hearing officers may be adopted, rejected or modified. Counsel in this regard also points to §28-401.19(13), cited earlier, which gives the Commissioner alone the power to suspend or revoke a license. But again, it must be emphasized that in exercising that power, the Commissioner is obliged to adhere to the Code and must be able to show that here Inglese's "poor moral character" did "adversely reflect on his fitness to conduct work regulated by this code." He simply was unable to show that here on the record as it was presented at the OATH hearing.

The circumstances of this controversy make it clear that DOB had decided to revoke Mr. Inglese's license as early as February 2009. Their counsel, Ms. Dart, said as much. Then, after failing to persuade Mr. Inglese to surrender his license with the hope of reapplying to get it back, it called him in for an interview to obtain sworn testimony, additional to his plea allocation in 2004. DOB's counsel made a decision that all they had to do was submit that plea allocution in order to obtain the recommendation they sought. But that strategy did not work. The independent ALJ found that DOB had failed to meet its burden of proving the elements of a violation of the Administrative Code. Following that, the Commissioner simply disregarded that recommendation and the legal rationale supporting it to obtain the result the Department had wanted all along.

That is not right and it is shocking to one's sense of fairness. I want to emphasize here that my findings, which lead to granting the petition, are not based on mere technicalities or confusion found sometimes in other cases. Here there was a fundamental failure of proof, one which is too late to correct.[FN2] Therefore, I am annulling the Commissioner's decision and remanding this matter with the directive that the Commissioner accept the recommendation of the ALJ, and when the one year suspension is up, the DOB renew Inglese's hoist machine [*7]operator's license at issue here.

Accordingly, it is hereby

ADJUDGED that the petition is granted, the April 23, 2010 decision by DOB Commissioner LiMandri is annulled, and the matter is remanded for a new determination consistent with this decision.

Dated: October 19, 2010

_____________________________

J.S.C. Footnotes

Footnote 1:The contact between petitioner and respondent is detailed in an affirmation submitted by Camie Dart as a supplement to respondent's "Statement of Relevant Facts" contained in the Answer, which this Court requested.

Footnote 2:Remanding this matter to the Commissioner for a second hearing would be unfair under the circumstances detailed above.