New York State Court of Claims

New York State Court of Claims

VRIESENDORP v. STATE OF NEW YORK, #2005-018-473, Claim No. 109507, Motion Nos. M-69703, CM-69908


Synopsis


Defendant's motion to dismiss is denied in part. Claimant has minimally set forth a valid cause of action for breach of the terms of the agreement of employment. The claim does minimally state a cause of action for breach of the implied covenant of good faith and fair dealing. Claimant has set forth a cause of action for wrongful discharge. For purposes of public policy, no action lies against the State for intentional infliction of emotional distress and this cause of action is dismissed. Claimant has failed to state a cause of action for prima facie tort.

The proposed amendment is patently deficient and Claimant's motion to add a cause of action for tortious interference with contract or business relations must be denied.

Case Information

UID:
2005-018-473
Claimant(s):
HUIBERT M. VRIESENDORP, M.D.
Claimant short name:
VRIESENDORP
Footnote (claimant name) :

Defendant(s):
STATE OF NEW YORK
Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
109507
Motion number(s):
M-69703
Cross-motion number(s):
CM-69908
Judge:
DIANE L. FITZPATRICK
Claimant's attorney:
Abrams, Fensterman, Fensterman,
Flowers, Greenberg & Eisman, LLPBy: Sarah C. Lichtenstein, Esquire
Defendant's attorney:
Eliot Spitzer
Attorney General of the State of New York
By: Patricia M. Bordonaro, EsquireAssistant Attorney General
Third-party defendant's attorney:

Signature date:
June 29, 2005
City:
Syracuse
Comments:

Official citation:

Appellate results:

See also (multicaptioned case)



Decision

Claimant brings a motion to amend the claim to include a cause of action for tortious

interference with contract and business relationship. Defendant opposes the requested relief and brings a cross-motion to dismiss the claim.

The claim, filed on June 21, 2004, seeks damages for breach of contract, breach of implied covenant of good faith and fair dealing, abusive/wrongful discharge, intentional infliction of emotional distress, and prima facie tort. Claimant alleges in the claim that he was forced to: (1) resign from his employment as "Clinical Investigator" for the Research Foundation of the State University of New York (hereinafter Foundation); (2) resign from his position as Assistant Professor at the State University of New York Upstate Medical University (hereinafter SUNYUMU); and (3) withdraw his application for medical staff privileges at the State University of New York Upstate Medical University (hereinafter University Hospital).

Claimant asserts that in a letter dated November 5, 2003, from Dr. Chung T. Chung, Chair of the Department of Radiation Oncology, at SUNYUMU, he was offered a faculty appointment with SUNYUMU and a position as "Clinical Investigator" with the Foundation. Claimant accepted the offer. By letter dated February 13, 2004, Dr. Gregory L. Eastwood, President of SUNYUMU, made Claimant an official offer of employment, according to Claimant, as a "Clinical Investigator" with the Foundation and as an Assistant Professor in the Department of Radiation Oncology at a total salary of $220,000. Claimant accepted this offer on March 1, 2004. Prior to acceptance of the offer, Claimant also applied for medical staff privileges at University Hospital. On March 11, 2004, Claimant alleges Dr. Chung advised that his application for medical staff privileges was going to be denied which, according to Dr. Chung, would have to be reported to the New York State Office of Professional Medical Conduct. Claimant undertook to provide additional information to the Credentialing Committee. On April 5, 2004, Claimant's counsel was advised by Mary Ann Merklein, Director of Medical Staff Services at University Hospital, that the additional information was unnecessary because the Credentialing Committee had already reached its decision. Dr. Chung also spoke with Claimant and allegedly advised him that he should have previously withdrawn his application for medical staff privileges, rather than provide the additional information, because the Executive Committee was scheduled to review and finalize the Credentialing Committee's decision the next morning. Claimant then wrote a letter to Ms. Merklein and the Credentialing Committee dated April 5, 2004, withdrawing his request for medical staff privileges.

Claimant also asserts that on April 6, 2004, Dr. Chung contacted him and advised that the Credentialing Committee would only accept the withdrawal of his application for medical staff privileges if "within one hour" he also resigned his position as a Clinical Investigator with the Foundation and his position as an Associate Professor with SUNYUMU. Claimant's attorney confirmed this with Molly C. Zimmermann, Esquire, Associate Counsel for University Hospital. Claimant then, by letter dated April 6, 2004, resigned his employment with the Foundation and his faculty position with SUNYUMU. Claimant asserts that the threatened reporting of a denial of medical staff privileges to the New York State Office of Professional Medical Conduct were unjustified threats, without basis in law or fact, depriving him of his employment contract and due process rights and procedures.

The Court will first address Defendant's motion to dismiss. Defendant has submitted, in support of its motion to dismiss, two affirmations and other documentation which purport to establish that Claimant does not have any cause of action against the State. Claimant argues that the Court cannot consider these affirmations and other evidence to determine whether there is evidentiary support for the pleading unless notice is given that the motion is being treated as one for summary judgment under CPLR 3212. Claimant's position is correct. Defendant's affirmations may not be used to establish that Claimant lacks evidentiary support for the claim (Rovello v Orofino Reality Co., Inc. 40 NY2d 633, 634-635; Marraccini v Bertelsmann Music Group, Inc., 221 AD2d 95, 97). Unlike a motion for summary judgment, Claimant has no obligation to submit affidavits on a motion to dismiss if confident that the allegations in the claim sufficiently state the necessary elements of a cause of action. If Claimant does submit affidavits they may be considered to remedy defects in the pleading and to preserve "inartfully pleaded, but potentially meritorious claims," (Rovello, 40 NY2d at 635; Cron v Hargro Fabrics, Inc., 91 NY2d 362, 366). The Court, in considering the motion, must give the Claimant the benefit of every favorable inference, accept the allegations as true, and only where it is clear that Claimant has no cause of action should the claim be dismissed (Leon v Martinez, 84 NY2d 83, 87). An affidavit submitted by Defendant may only be considered where it conclusively establishes that Claimant has no cause of action (Rovello, 40 NY2d at 633, 636; Albert v Solimon, 252 AD2d 139, 140).
Claimant's Cause of Action for Breach of Contract
The Claimant contends in the claim that he had a contract for employment with SUNYUMU for a faculty appointment and a position as a Clinical Investigator with the Foundation as evidenced by the letter to Claimant from Dr. Chung, as Chair of the University Department of Radiation Oncology dated November 5, 2003, and the second letter, considered the official offer, dated February 13, 2004, signed by Dr. Gregory L. Eastwood, President of the SUNYUMU.[1] Claimant asserts that the State breached its contract for employment when he was terminated without the required six months notice as provided in the letter dated November 5, 2003. It is Defendant's position that Claimant was never employed by the State, there was no employer-employee relationship. Claimant's salary was to be paid by the Foundation and the Department Medical Services Group, which according to Defendant are not entities of the State over which this Court has jurisdiction. Defendant further argues that there was no contract for employment, Claimant's employment with the Foundation and the Department Medical Services Group was "at will" employment terminable at any time for any reason. Defendant's final argument is that Claimant was never terminated but resigned.

Claimant has set forth sufficient facts in his claim to withstand dismissal of this cause of action. Claimant's employment involved positions with SUNYUMU, the Foundation and the Department of Radiation Oncology Medical Service Group. Compensation included a salary of $220,000, $20,000 to be paid by the Foundation and $200,000 to be paid from the Department Medical Service Group. In addition, Claimant was to receive specified fringe benefits, $4,000 for receipted moving expenses, a $12,000 annual Academic Enrichment Fund allowance, and the rights and privileges of membership as Faculty of the College of Medicine at Upstate Medical University. Which entity was responsible for providing these fringe benefits was not specified.

The requirements of each component of employment were not specified however an "Agreement of Academic Expectations" which was signed by Dr. Chung and Claimant was included with the November 5, 2003 letter. The offers of employment to Claimant were made by employees of the State. Whether there was an employer-employee relationship is a question of fact which turns upon whether the purported employer exercises control over the results produced or the means by which those results are produced (Matter of Ted Is Back Corp., 64 NY2d 725; 12 Cornelia Street, Inc., [Ross], 56 NY2d 895; Matter of Salamatian, 263 AD2d 748). Here, Defendant clearly had some control over Claimant's professional activities, and given the benefits being paid and the fact that employees of the State offered Claimant the positions, the Court cannot find as a matter of law that Claimant was not employed by the State as Defendant urges. Whether Claimant was terminated or voluntarily resigned is also a question of fact. Resignation procured by fraud, duress, coercion or other affirmative misconduct is not a voluntary act (Matter of Mangee, 239 AD2d 892; Fischer v KPMG Peat Marwick, 195 AD2d 222 [stated cause of action for constructive termination]). Whether the Credentialing Committee anticipated denying Claimant's request for staff privileges at University Hospital, and whether the potential denial related to an alleged mental or physical impairment, incompetence, malpractice, misconduct or impairment of patient safety or welfare requiring reporting to the Education Department pursuant to Public Health Law §2803-e are outstanding issues. At this juncture, Claimant has made sufficient factual assertions to raise a question as to whether or not his resignation was coerced.

Finally, although from the letter agreements there is no restriction on Claimant's termination, with or without cause, there is a limitation in the November 5, 2003 letter providing that if it became necessary to terminate Claimant's services on the faculty of SUNYUMU, six- months notice of intent to terminate would be provided. Without a provision for employment for a specified term, or a limitation on the reason(s) employment may be terminated, Claimant is presumed to be an "at will" employee (Horn v New York Times, 100 NY2d 85, 90; Lobosco v New York Telephone Co., 96 NY2d 312, 316; Sabetay v Sterling Drug, Inc. 69 NY2d 329, 333; Evans v Ithaca Urban Renewal Agency, 205 AD2d 844, 846; Zolotar v New York Life Ins. Co., 172 AD2d 27, 30-31). Nonetheless, Defendant expressly agreed to restrict its right to terminate Claimant at will on six-months notice. If Defendant effectively terminated Claimant, as alleged, six-months notice was required pursuant to the terms of the November 5, 2003 letter. Since Claimant argues this notice was not provided, which is borne out by Defendant's submissions, then Claimant has minimally set forth a valid cause of action for breach of the terms of their agreement (Zolotar, 172 AD2d at 30-31; Evans, 205 AD2d at 844; UWC, Inc. v Eagle Industries, Inc., 213 AD2d 1009; Vardi v Mutual Life Ins. Co. of New York, 136 AD2d 453)
Breach of Implied Covenant of Good Faith and Fair Dealing
A covenant of good faith and fair dealing will only be implied where it is consistent with other agreed upon contractual terms, it is implicit in the agreement when the contract is viewed as a whole (Rowe v Great Atlantic & Pacific Tea Co., 46 NY2d 62, 69). Such a covenant will not be implied where it is inconsistent with other terms or would conflict with the law giving the employer an unfettered right to terminate the employee at any time; in that context it would be inconsistent to find that the employer impliedly agreed to a provision which would effectively destroy his right to terminate the employee for any reason at any time (Sabetay, 69 NY2d at 335-336; Murphy v American Home Prods. Corp., 58 NY2d 293, 304-305; Zolotar, 172 AD2d at 30-31). Although in other contracts there is an implied covenant of good faith and fair dealing, under New York law "absent a constitutionally impermissible purpose, a statutory proscription, an express limitation in the individual contract of employment" an employer's right to terminate employment at will is not constrained by such an implied covenant (Murphy v American Home Prods. Corp., 58 NY2d at 305). Where there is an express limitation on the employer's right of discharge, it will be given effect, even though the employment is for an unspecified duration (id.). Claimant relies on Defendant's obligation to provide six-months notice of termination to argue that Defendant did not have an "unfettered" right of termination. Nothing in any letter offering Claimant employment restricted Defendant's right to terminate Claimant, there was no limitation on the reason or even lack of reason for termination and the November 5, 2003 letter specifically refers to Claimant's faculty appointment as a temporary appointment. Yet the express notice requirement did condition the effective time-frame for termination and thus limited the State's "unfettered" right to terminate Claimant. As a result, the claim does minimally state a cause of action for breach of the implied covenant of good faith and fair dealing, given Claimant's assertion that Defendant acted in such a manner so as to deprive Claimant of the right to receive benefits under the contract (511 West 232nd Owners Corp. v Jennifer Realty Co., 98 NY2d 144, 2 NY PJI2d 4:1, at 632[2 ed]).

Abusive/Wrongful Discharge

The Courts of this State have declined to recognize the tort of abusive or wrongful discharge for at will employment (Murphy, 58 NY2d at 300-301; Negron v JP Morgan Chase/Chase Manhattan Bank, 14 AD3d 673; Vardi, 136 AD2d at 455). Yet as described in the preceding paragraphs, the State expressly limited its ability to terminate Claimant at will on six-months notice of intent. Since Claimant alleges Defendant failed to provide this notice he has set forth a cause of action for wrongful discharge.
Intentional Infliction of Emotional Distress
For purposes of public policy, no action lies against the State for intentional infliction of emotional distress (DeLesline v State of New York, 91 AD2d 785; Wheeler v State of New York, 104 AD2d 496). This cause of action must be DISMISSED.
Prima Facie Tort
To state a cause of action for prima facie tort the pleading must allege: (1) intentional infliction of harm without justification or excuse, (2) causing special damages, by (3) acts or a series of acts which would otherwise be lawful (Curiano v Suozzi, 63 NY2d 113, 117; Cavanaugh v Doherty, 243 AD2d 92, 101). The acts must be motivated solely by disinterested malevolence (Burns Jackson Miller Summit & Spitzer v Lindner, 59 NY2d 314, 333; Cavanaugh, 243 AD2d at 101). Claimant has failed to state a cause of action for prima facie tort. No special damages have been alleged, nor is there any allegation or facts to suggest that Defendant's actions were motivated solely by malevolence (Burns Jackson Miller Summit & Spitzer, 59 NY2d at 333). This cause of action must also be DISMISSED.

As set forth above, Defendant's motion is granted in part and denied in part.
Claimant's Motion to Amend the Claim M-69703
Claimant seeks to amend the claim to assert a cause of action for interference with contract and business relationship. Defendant opposes the relief on the ground that there is no merit to the proposed amendment.

CPLR 3025(b) provides that a party may move to amend his pleading at any time by setting forth additional or subsequent transactions or occurrences by stipulation or leave of court and that such leave shall be freely given upon such terms as may be just. When determining a motion to amend a pleading a court must examine the sufficiency and merit of the proposed amendment to determine whether it is patently deficient (Fiesel v Nanuet Props. Corp., 125 AD2d 292; Zahler v Niagara County Ch. of NY State Assn. For Retarded Children, 112 AD2d 707). If the proposed amendment is potentially meritorious and Defendant will suffer no prejudice, permission to amend should be given (Sharapata v Town of Islip, 82 AD2d 350, 362, affd 56 NY2d 332).

To determine whether a cause of action for tortious interference with a contract and business relationship is set forth, the assessment must begin with what are Claimant's alleged enforceable rights. Where there is an existing enforceable contract Defendant's interference resulting in breach of that contract may permit Claimant to recover damages, even if Defendant's conduct was lawful (Guard-Life Corp. v S. Parker Hardware Mfg. Corp., 50 NY2d 183; NBT Bancorp Inc. v Fleet/Norstar Financial Group, Inc., 87 NY2d 614, 620-621; Carvel Corp. v Noonan, 3 NY3d 182, 189-190). To establish a cause of action for tortious interference with a contract there must be (1) the existence of a valid contract between claimant and a third party; (2) defendant must have knowledge of that contract; (3) defendant must intentional and improperly procure the third party's breach; and (4) as a result claimant suffers damages (Lama Holding Co. v Smith Barney, Inc., 88 NY2d 413, 424; Guard-Life Corp., 50 NY2d at 189-190; Weaver v Town of Rush, 1 AD3d 920, 924).

Here, Claimant asserts that he had an enforceable contract for employment for at least six months, and Defendant's misrepresentations without any basis in fact or law and unjustified threats interfered with this contractual relationship with the Foundation and the Department Medical Services Group causing damages. The difficulty with Claimant's position is that the "conduct constituting tortious interference with business relations is, by definition, conduct directed not at the [claimant himself], but at the party with which the [claimant] has or seeks to have a relationship," (Carvel Corp., 3 NY3d at 192). Claimant makes no allegation that the State's conduct was directed at the Foundation or the Department Medical Services Group. Rather, Defendant's alleged wrongdoing was directed at putting pressure on Claimant himself. The proposed amendment is patently deficient and Claimant's motion to add a cause of action for tortious interference with contract and business relationship must be denied (id.).

Accordingly, based upon the foregoing Defendant's motion to dismiss the claim is GRANTED IN PART and DENIED IN PART and Claimant's motion to amend the claim is DENIED.

June 29, 2005
Syracuse, New York

HON. DIANE L. FITZPATRICK
Judge of the Court of Claims


The Court has considered the following documents in deciding these motions:


Notice of Motion..............................................................................................1


Affidavit of Sarah C. Lichtenstein, Esquire, in support with exhibits

attached thereto.....................................................................................2


Claimant's Memorandum in Support of Motion to Amend

"Notice of Claim".................................................................................3


Notice of Cross-Motion....................................................................................4


Affirmation of Patricia M. Bordonaro, Esquire, Assistant Attorney General
in Opposition to Claimant's Motion to Amend

and in Support of Defendant's Cross-Motion to Dismiss

with exhibits attached thereto...............................................................5


Defendant's Memorandum of Law in Opposition to Claimant's Motion

to Amend and in Support of Defendant's Cross-Motion

to Dismiss Claim...................................................................................6


Claimant's Reply Memorandum in Further Support of Motion to Amend

and in Opposition to Cross-Motion to Dismiss.....................................7




[1] These letters are actually attached to Defendant's motion as exhibits D and E, however, Claimant refers to these letters and Defendant's exhibits in his responding documents and it is for this reason these exhibits were considered by the Court.