Matter of Institute for Puerto Rican/Hispanic Elderly v New York City Dept. for the Aging

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Matter of Institute for Puerto Rican/Hispanic Elderly v New York City Dept. for the Aging 2012 NY Slip Op 32987(U) December 10, 2012 Supreme Court, New York County Docket Number: 103869/12 Judge: Manuel J. Mendez Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. SCANNEDON I211712012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK MANUEL J. MENDEZ Justice PRESENT: COUNTY PART 13 In the Matter of the Application of THE INSTITUTE FOR PUERTO RlCANlHlSPANlC ELDERLY, INDEX NO. 103869112 MOTION DATE MOTION SEQ. NO. MOTION CAL. NO. Petitioner, 10-31-12 00 1 For Judgment Pursuant to CPLR Article 78 -against - UNFILED JUDGMENT THE NEW YORK CITY DEPARTMENT FOR THE AGING and THE CARTER BURDEN CENTER, Respondents. l"h1g ludgment has not been entered by the County Clerk and noti& of entry cannot be served based hereon. TO Obtain entry, counsel or authorized irepresentative must r In person at the Judgment Clerk's Desk (Roan 941B, ) PAPERS NUMBERED Answering Affidavits - Exhibits - Affidavits - Exhibits ... 1-4 cross motion Notice of Motion/ Order to Show Cause 3-5.6-7 8-9 Replying Affidavits Cross-Motion : Yes X No Upon a reading of the foregoing cited papers, the petition seeking injunctive relief, enjoining and restraining the respondents from taking any action pending the outcome of this proceeding, is denied. It is Ordered and Adjudged that this Article 78 petition is denied and the proceeding is dismissed. Petitioner's Order t o Show Cause seeks t o enjoin the New York City Department for the Aging ("DFTA") from taking any steps t o execute or otherwise implement the contract award t o The Carter Burden Center (hereinafter referred t o as "Carter Burden") for the administration of the Leonard Covello Senior Center (hereinafter referred t o as "Covello Center"). Petitioner seeks a judgment pursuant t o CPLR Article 78, nullifying and setting aside DFTA's determinations terminating and not renewing its contract for the administration of the Covello Center, instead awarding the contract t o Carter Burden. Petitioner also seeks t o have this Court direct respondents t o conduct a public hearing on the proposed contract and secure registration by the Comptroller on petitioner's behalf. The movant seeking a preliminary injunction, is required t o demonstrate that the factors required pursuant t o CPLR Article 62 and 63 concerning preliminary injunctions also apply t o the petition (Uniformed Firefighters Ass'n of Great New York v. City of New York, 79 N.Y. 2d 236, 590 N.E. 2d 719, 581 [* 2] N.Y.S. 2d 734 [1992]). A movant seeking a stay or injunction, is required t o show, "(1) the likelihood of ultimate success on the merits; (2) irreparable injury t o him absent granting of the preliminary injunction; and (3) that a balancing of the equities favors his position" (Nobu Next Door, LLC v. Fine Arts Housing, Inc., 4 N.Y. 3d 839, 833 N.E. 2d 191, 800 N.Y.S. 2d 48 [20051). Irreparable injury requires a showing that there is no other remedy at law, including monetary damages, that could adequately compensate the party seeking relief (Zodkevitch v, Feibush, 49 A.D. 3 d 424, 854 N.Y .S. 2d 373 1N.Y .A.D. 1*' Dept., 20081). An administrative determination will withstand judicial scrutiny if it is supported by substantial evidence, has a rational basis and is not arbitrary and capricious (Matter of Pel1 v. Board of Education, 34 N.Y. 2d 222, 356 N.Y.S. 2d 833, 313 N.E. 2d 321 [1974]). Judicial review of an administrative determination is confined t o the facts and record adduced before the agency, absent a showing that the determination is arbitrary or capricious (Featherstone v. Franco, 9 5 N.Y.2d 550, 7 4 2 N.E.2d 607, 720 N.Y.S.2d 93 [20001). A contract containing an unconditional termination clause provides a party with the unqualified, absolute right t o limitation by notice of termination, without court inquiry. The Court may not inquire as t o whether there was an ulterior motive for the activation of an unconditional termination clause (Red Apple Child Development Center v. Community School Districts Two, 303 A.D. 2d 156, 756 N.Y.S. 2d 527[N.Y.A.D. 1'' Dept., 20031 citing to Big Apple Car v. City of New York, 204 A.D. 2d 109, 611 N.Y.S. 2d 533 [N.Y.A.D. 1'' Dept., 19941). Where there is no prescribed time, a hearing is t o be provided within a reasonable time. There is no basis for a finding of misconduct for failure t o perform a nondiscretionary act, or t o compel a purely ministerial act, where the requirement of a hearing has no prescribed time (Clark v. Schirro, 91 A.D. 3d 483, 935 N.Y.S. 2d 887 [N.Y.A.D. 1" Dept., 20121). A municipality's, acceptance of services performed under an unauthorized contract, does not estop the municipality from asserting the invalidity of the contract" (Matter of Garrison Servs. v. Office of the Comptroller of the City of N.Y., 92 N.Y. 2d 732, 708 N.E. 2d 994, 685 N.Y.S. 2d 921 119991). " ... Petitioner has run the Covello Center since 1991, there was a ten year contract in place prior t o the 2012 fiscal year. On July 1, 2012, petitioner entered into a renewal contract with DFTA for a one year period t o expire on June 30, 2013 (DFTA Ans., Exh.1). The renewal period was shortened because DFTA was in the process of a city-wide procurement utilizing an innovative procurement process pursuant t o the Procurement Policy Board ("PPB") rules. The t w o stage process was approved as of August 2, 2010 (DFTA Ans., Exh. A), and published in the City Record on August 16, 2010 (Pet. Aff. of Merit, Exh. A). The procurement process utilized by DFTA required pre-qualified non-profit organizations t o obtain approval for their status. DFTA could select candidates from the list of pre-qualified vendors after determining which had suitable qualifications. Selected pre-qualified candidates were required t o compete by submitting a proposal for each senior center site, t o be evaluated and rated by a committee, the contract t o be awarded t o the candidate with the highest rating (DFTA Ans., Exh. C). [* 3] As of February 17, 201 2,three pre-qualified vendors submitted initial proposals for the Covello Center, including petitioner and Carter Burden. On March 27, 2012,final proposals were submitted. There were three reviewers on the committee that evaluated the proposals, petitioner received the lowest rating of the pre-qualifed candidates applying for the Covello Center (DFTA Ans., Exhs. E,F&G). A DFTA letter dated July 18,2012,notified petitioner that its solicitation for the Covello Center was not being considered for a contract award (Pet. Aff. of Merit, Exh. C). On July 26, 2012,petitioner sent a written Appeal (Pet, Aff. of Merit, Exh. D) which was denied on August 2, 2012 (Pet. Aff. of Merit, Exh. E). , Petitioner submitted proposals for eight (8) Centers it held contracts with including the Covello Center, and won seven ( 7 ) of them covering a period of three or more years (DFTA Ans., Exh. D). The only contract petitioner lost was the Covello Center. Carter Burden was rated the highest by the committee of the three prequalified candidates and awarded the Covello Center contract. DFTA entered into a contract with Carter Burden t o provide services for a period of three years, nine months, starting October 1, 2012 through June 30, 2016. The contract includes a renewal option for the period from July 1, 2016 t o September 30, 2018 (DFTA Ans., Exh. I),On September 10,2012,DFTA posted notice of public hearing in the City Record. The meeting was held on September 24,2012 (DFTA Ans., Exh. L). The July 1, 201 2 renewal contract between petitioner and DFTA, at Appendix A, "Article IO, Termination, Default and Reduction in Funding," has an unconditional termination clause in Section 10.01, titled, "Termination by the City Without Cause." Section 10.01, paragraph A, specifically states, "The City shall have the right t o terminate this Agreement, in whole or in part, without cause, in accordance with the provisions of Section 10.05." Section 10.05, titled "Procedures for Termination," in paragraph A of the renewal contract, provides DFTA or the City's requirements for notice under the contract. DFTA or the City, shall give written notice of termination without cause, with an effective date that days from the date the notice is sent by mail. shall not be less than fifteen (15) There were no other termination requirements of DFTA pursuant t o the parties' renewal contract (DFTA Ans., Exh. I). Section 10.05,paragraph B, provides a list of close out procedures t o be followed by the petitioner, including, "Providing reasonable assistance t o the Department in the transition if any, t o a new contractor"(DFTA Ans., Exh. I). DFTA sent petitioner a letter dated August 7, 201 2,providing notice of termination. The letter states that the contract would be terminated without cause effective September 30, 2012.By letter dated August IO, 2012, DFTA sought petitioner's compliance with close-out procedures as stated in the July 1, 2012 renewal contract (DFTA Ans., Exh. J). Upon review of all the papers submitted this Court finds that there is no basis t o maintain this petition. The July 1, 2012 renewal contract in Section 10.01, paragraph A, contains an unconditional termination clause. DFTA has complied with Section 10.05,paragraph A, of the renewal contract. PPB Rules §3-04(b)(4), provides that negotiations shall take place with all qualified vendors that have expressed an interest, "...unless the ACCO determines for a particular procurement or for a particular type of procurement, it [* 4] i in the City's best interest t o negotiate with fewer vendors, and the CCPO approves such determination." DFTA has provided affidavits establishing that the ACCO (Agency Chief Contracting Officer) determined there was no need t o negotiate with all pre-qualified vendors. The ACCO's determination was approved by the CCPO (City Chief Procurement Officer). Petitioner was evaluated by a committee and placed third out of three pre-qualified providers bidding for the Covello Center. There was no need t o negotiate with the petitioner. PPB Rules 93-12 applies t o public hearings prior t o implementation of the proposed innovative procurement method. There is no specific time requirement in PPB Rules 93-12 of a public hearing after the award. DFTA complied with PPB Rules and the public hearing was held within a reasonable time after the award to Carter Burden. Respondents provided a rational basis for their determination and have not acted arbitrarily or exceeded their authoriTy by entering into a contract with Carter Burden. There is no basis for petitioner's contentions that DFTA acted arbitrarily by entering into an agreement with Carter Burden prior to approval by the comptroller. Carter Burden assumed the risk of entering into an agreement with DFTA, and acting t o act on the agreement prior t o comptroller approval. DFTA's termination of the renewal contract is not arbitrary and within the agency's discretion. Petitioner has not established a basis for the petition or injunctive relief. Accordingly, it is ORDERED that the petition seeking injunctive relief, enjoining and restraining the respondents from taking any action pending the outcome of this proceeding, is denied, and it is further, ORDERED that any temporary stay pending a hearing on this motion, is vacated, and it is further, ORDERED AND ADJUDGED that the petition is denied and the proceeding is dismissed. ENTER: Dated: December IO, 2012 MANUEL J.' MENDEZ, J.s. c. MANUEL J. MENDEZ J.S.C. Check one: X FINAL DISPOSITION 0 NON-FINAL DISPOSITION wm DO NOT POST Check if appropriatSL.-- Q,RE FERENc E UNFILED JUDGMENT This judgment has not been entered by the County Clerk and noti* of entry cannot be served based hereon. TO obtain eotry. counsel or authorized representative must appear in person at the Judgment Clerk's Desk (Room 141B). t' , . d *

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