VRIESENDORP v. STATE OF NEW YORK, #2008-018-638, Claim No. 109507, Motion Nos.
Claimant and Defendant each brought motions for Summary Judgment based upon CPLR
3212 asserting no material facts exist and this matter may be decided as a
matter of law. The Court finds that Claimant voluntarily, albeit with limited
options, resigned his position with the State. Given his resignation,
Claimant’s causes of action for breach of contract, wrongful termination,
and breach of the covenant of good faith and fair dealing must fail.
Defendant’s motion is GRANTED and Claimant’s motion is hereby
HUIBERT M. VRIESENDORP, M.D.
Footnote (claimant name)
STATE OF NEW YORK
Footnote (defendant name)
DIANE L. FITZPATRICK
ABRAMS, FENSTERMAN, FENSTERMAN, EISMAN, GREENBERG, FORMATO & EINIGER, LLPBy: Sarah C. Lichtenstein, Esquire
ANDREW M. CUOMO
Attorney General of the State of
By: Patricia M. Bordonaro,
EsquireAssistant Attorney General
October 8, 2008
See also (multicaptioned
Claimant brings an action against the State of New York for breach of contract,
the implied covenant of good faith and fair dealing, and for abusive/wrongful
discharge. After lengthy pre-trial proceedings, both the Claimant and Defendant
bring motions for summary judgment pursuant to CPLR 3212 asserting that no
material issues of fact exist and the claim may be decided as a matter of law.
In essence, the majority of facts are not in dispute as evidenced by the
submissions of the parties; although, clearly the parties’ interpretation
of the facts is highly contested. Yet, where only one conclusion may be drawn
from the established facts, the claim may be decided as a matter of law (see
Culkin v Parks & Recreation Dept. of City of Syracuse, 168 AD2d 912).
It is undisputed that in July of 2003, Claimant, a medical doctor licensed in
New York, Wisconsin, Massachusetts, Maryland, and Montana, contacted Dr. Chung
T. Chung, Chair of the Department of Radiation-Oncology at the State University
of New York Upstate Medical University (SUNYUMU) about potential employment.
Claimant was living in Wisconsin at the time of his initial contact with Dr.
Chung. After a few e-mail communications with Dr. Chung, Claimant met with him
in October 2003, and again in November or December 2003. On November 5, 2003,
Dr. Chung forwarded a letter to Claimant on SUNYUMU
the letter offered Claimant a
faculty appointment with SUNYUMU as Assistant Professor. It was noted that his
promotion to Professor was anticipated following approval by the College of
Medicine Faculty Appointments and Promotions Committee. The letter says that
once Claimant signed the letter reflecting his approval of the terms of the
offer, Dr. Chung would forward his recommendation to the Dean of the College of
Medicine, William J. Williams, M.D., and the President of SUNYUMU, Dr. Gregory
Eastwood, would actually make the official offer of employment to
As a condition of his position as Assistant Professor with SUNYUMU, Claimant
was required to work at a satellite office(s) in addition to providing clinical
care at the hospital. Other terms included:
a.) You will be an employee of the Research Foundation of the State University
of New York. Your official payroll title will be Clinical Investigator. You
will be granted a concurrent unpaid faculty appointment with the State
University of New York at the rank of Assistant Professor as described
b.) You will have all rights and privileges of a member of the Faculty of the
College of Medicine at Upstate Medical University as defined by the policies and
articles of governance of such. Please refer to our website at
www.upstate.edu for more information.
c.) You will have all rights and privileges of membership in the Department of
Radiation Oncology Medical Service Group, University Hill Radiation Oncology,
d.) Your annual salary from all sources will be $220,000 (plus benefits) for
the first year. Your starting annual base salary rate of $20,000 will be paid
by the Research Foundation of the State of New York, and $200,000 will be paid
from the Department Medical Service Group fund. Salary increases and/or bonuses
may be granted annually following yearly review, dependent upon the financial
status of the department. Your fringe benefit package includes an approximate
15% contribution to a retirement plan as well as medical, life, and malpractice
e.) This is a temporary appointment subject to he availability of funds. This
appointment does not carry credit toward continuing appointment nor can
a continuing appointment be considered during your service in this
f.) The effective date of this appointment is [March 1, 2004] or a date to be
mutually agreed upon, contingent upon your satisfactory completion of employment
physical examination and evidence of a valid New York State medical license, and
subject to your arrival prior to or on that date to complete necessary
employment paperwork with the offices of Human Resources and Payroll.
g.) Office space will be provided and you will have use of all department
h.) You will be reimbursed up to $4,000 for receipted moving expenses,
including your personal travel costs.
i.) An Academic Enrichment Fund allowance will be provided for your use; at
the present time this allowance amounts to approximately $12,000 annually, and
can be used for books, journals, society dues, professional license fees,
computers, and professional and educational travel.
j.) If in the future you decide to terminate your position in this department,
you agree to provide the Department Chair with notice of intent to terminate, in
writing, at least six months prior to the anticipated date of your termination.
Similarly, if our department should find it necessary to terminate your services
on our faculty, the Chair will notify you of such intent, in writing, at least
six months prior to the effective date of such termination.
k.) At the time of your employment you will be required to sign a Restrictive
Covenant, which will prohibit the competitive practice of radiation oncology in
areas served by the Department of Radiation Oncology for a period of two years
following termination of employment. By means of your signature below, you
agree to the requirement to sign such a document.
Additionally, an “Agreement of Academic Expectations” was included
setting forth the requirements of research, teaching, clinical care, mentoring,
consultation, service, collegiality, and evaluation and directed that as an
Assistant Professor, Claimant must “[f]acilitate the goals of SUNY Upstate
Medical University at all times.” Claimant accepted the terms of the
offer and the academic expectations by signing both documents on November 13,
2003. He also made two follow-up visits to Syracuse in December 2003 and
January 2004. In December 2003, Claimant spent time in Syracuse looking for a
home. He also signed an application on December 5, 2003, for Medical Staff
Appointment and Clinical Privileges
SUNYUMU, University Hospital (hereinafter University Hospital). Claimant
testified in his deposition that he signed the application and Dr. Chung’s
secretary, Maureen Knopp, completed the application by typing the requested
information. In January, Claimant filled out many forms to facilitate insurance
billing for patients.
Thereafter, by letter dated February 13, 2004, Dr. Gregory Eastwood, President
of SUNYUMU, offered Claimant the Assistant Professor faculty position in the
Department of Radiation-Oncology effective March 1,
The letter indicated that for payroll
purposes his title would be Clinical Investigator and his salary would be paid -
$20,000, funded by the Research Foundation Grant 1029170-31290-3, and the
balance, $200,000, from the Department of Radiation-Oncology Medical Service
Group Fund. The portion to be paid from the Medical Service Group Fund was
noted as not the responsibility or obligation of SUNYUMU. Claimant was reminded
that this was a temporary appointment subject to the availability of funds, and
the appointment did not provide credit toward continuing appointment nor would
continuing appointment be considered while Claimant held this specific position.
The policies of the Board of Trustees of SUNY, Article 11 under
“Appointment of Employees” Title F, defines a temporary appointment
as an appointment which “may be terminated at any
Claimant signed this letter in
acceptance on March 1, 2004, when he actually began his position.
When Claimant applied for University Hospital privileges in December 2003, he
was advised by Dr. Chung’s secretary, Maureen Knopp, which was confirmed
by Dr. Chung, that the process should take approximately three months and should
be completed or almost complete by the time he was expected to begin work on
March 1, 2004. Typically, consideration for a position on the faculty
progresses simultaneously with an application for privileges at the hospital.
As part of the process, Claimant was contacted and scheduled an interview with a
Dr. Weiner in pediatrics for the last week in February 2004.
Claimant did not have privileges for clinical practice at University Hospital
at the time he began his position. He testified that he followed Dr. Hahn as he
saw new patients in the clinic. Claimant was present for morning conferences
and gynecologic tumor boards, pediatric tumor boards, solids tumor boards, and
hematology tumor boards. He participated in department meetings. He did some
teaching of the residents and also had discussions with two radiation biologists
regarding work they were doing and how Claimant might assist. Although Claimant
could advise on patient care, he could not treat patients directly without
having credentialing at the hospital. Claimant was paid during this time
according to the terms of his agreement by the Research Foundation and also by
the Practice Group. No checks came directly from SUNYUMU.
After beginning his position, he spoke with Patricia Numann, M.D., the Medical
Director of University Hospital who oversees the activities of the medical staff
office particularly in areas of quality, civility, and competence of the
physicians within the hospital. Dr. Numann supervises the employees in the
medical staff office who conduct the credentialing process for the hospital.
Mary Ann Merklein is the Director of Medical Staff Services and is involved
directly in the credentialing process. She also attends all of the
Credentialing Committee and the Medical Executive Committee meetings. Dr.
Numann is also a member of the Medical Executive Committee of the hospital.
This committee consists of eight elected official members and a couple
ex-officio members who represent the medical staff of the hospital. In relation
to the credentialing process for the hospital, this committee appoints the
medical staff. The Credentialing Committee gathers information about a
physician and then after meeting, makes a report recommending that privileges be
granted or denied to the Medical Executive Committee.
Dr. Numann explained the process of obtaining hospital privileges. To apply
for privileges at the hospital, a doctor must first be a faculty member with
SUNYUMU. Contact must first be made to the Chief of the University Department
in which a position is sought. The Medical Staff Office would then, upon the
direction of the Chair of the Department, send out an application for privileges
form. Once the application is completed, the Medical Staff Office does primary
verification of the information the applicant provides. This means that the
information sought must come from the specific people from whom it was sought,
and the feedback needs to be responsive to the request. Once the requested
verification is obtained, the Credentialing Committee will meet and review the
information and decide whether or not privileges should be granted. A report of
the Credentialing Committee’s decision is then forwarded to the Executive
Medical Committee which will or will not offer the physician an appointment. It
is actually the Executive Medical Committee which grants or denies privileges.
If granted, a meeting is scheduled for the physician’s orientation to
review the rules of the hospital.
Dr. Numann recalled that regarding Claimant’s application she had spoken
a number of times with Mary Ann Merklein, Director of Medical Staff Services,
about the difficulty they were encountering obtaining the information requested
from Claimant’s prior employers. Efforts were made to get the information
in writing and by telephone without success. The Chair of the Credentialing
Committee, Dr. Robert Carhart, spoke with Dr. Numann about what they should do
given the dearth of pertinent feedback. Dr. Numann advised Dr. Carhart that
given their diligent attempts to get the information relating to
Claimant’s competence, character, and performance, the credentialing
process could not go forward and privileges could not be granted.
Claimant spoke with Dr. Chung at his office on March 10, 2004. At that time,
Dr. Chung told Claimant that he would not be credentialed and he had until
Monday to decide whether to withdraw his application. He advised Claimant that
if his credentialing was denied a report would have to be made to the New York
State Office of Professional Medical Conduct (hereinafter OPMC); if he withdrew
his application it would not go the Credentialing Board or to the State.
Typically, at that time, the Credentialing Committee met the second Monday of
every month and the Medical Executive Committee met the first Tuesday of every
month. Whatever happened at the Credentialing Committee meeting was on the
agenda for the following Medical Executive Committee. The Credentialing
Committee met late in March 2004, on March 29, regarding Claimant’s
application. In this case, the next scheduled Medical Executive Committee
meeting was April 6, 2004.
On March 10 or 11, 2004, a Friday evening, Claimant spoke with Dr. Numann to
inquire what additional credentialing information was needed. Claimant
testified that she told him that he had all the time he needed to get additional
information, but that if the Credentialing Committee did not get satisfactory
information from the requested sources, his application would be denied and a
report would have to be made to the State.
Thereafter, Claimant tried to obtain additional information for his
credentialing but no additional information was received. At the March 29, 2004
meeting, the Credentialing Committee decided that the issue of Claimant’s
privileges would be sent on to the Medical Executive Committee without a
recommendation as to credentialing. In early April, Claimant spoke with his
attorney from Wisconsin, Jeff Scott Olson. On April 5, 2004, Mr. Olson spoke
directly with Ms. Merklein and inquired about whether the Medical Executive
Committee’s meeting could be rescheduled. He was told that the meeting
could not be rescheduled. Ms. Merklein advised Mr. Olson that he could fax
additional information from one of Claimant’s prior employers, but that
the Credentialing Committee had already met and made a decision. Mr. Olson did
fax a letter from one of Claimant’s prior employers to Ms. Merklein, and
in the cover letter to her, Mr. Olson indicated that Claimant would accept
probationary credentialing unless the Committee would defer making a decision so
that additional data could be provided. He also inquired as to whether Claimant
could still withdraw his application to avoid a negative decision. Mr. Olson
also spoke with Molly Zimmermann, Associate Counsel with SUNYUMU, and Dr. Chung
and then he advised Claimant to withdraw his application for privileges.
Claimant hand-wrote a letter to the Credentialing Committee withdrawing his
request for hospital privileges on April 5, 2004, and faxed it to Mary Ann
Merklein the same day. Claimant testified that Dr. Chung telephoned Claimant in
his office during the morning of April 6, 2004, and told him that he had to
resign his positions with the Research Foundation and the Medical Services Group
within one hour, or the Medical Executive Committee meeting later that day,
would not accept the withdrawal of his application for privileges. Dr. Chung
spoke with Mary Ellen Kenny from the Human Resources Department of the hospital
before talking with Claimant, and it was Dr. Chung’s understanding that if
Claimant had withdrawn his application for privileges, his employment with the
Research Foundation and position with SUNYUMU must be
Dr. Chung acknowledged that he
may have told Claimant that if he was withdrawing this application for
privileges, he also had to resign his positions with SUNYUMU and the Research
Foundation. It was Dr. Chung’s understanding that if Claimant was
withdrawing his application for privileges, it was his intention to also resign
his faculty and clinical positions as the privileges were integral to performing
Claimant hand-delivered a
letter to Dr. Chung, dated April 6, 2004, resigning his faculty position as well
as his position with the Research Foundation. Dr. Chung forwarded a letter to
Claimant of the same date indicating that Claimant’s resignation was
accepted and it was being considered a resignation from the Department of
Radiation-Oncology Medical Service Group as well.
The decision as to whether a denial of privileges must be reported to the OPMC
is jointly made by the CEO of the hospital, the Director of Medical Staff
Office, Dr. Numann and counsel for the hospital. Both Dr. Numann, Molly
Zimmermann, and Mary Ann Merklein indicated that if Claimant’s privileges
were denied because sufficient information could not be obtained regarding
Claimant’s character, competence, and performance from prior employers and
associations, at the least, inquiry would have to be made to OPMC for advisement
on whether a report must be filed.
Defendant’s motion will be addressed first. Defendant seeks dismissal of
the claim on a number of grounds. First Defendant argues that this Court lacks
subject matter jurisdiction over the claim, as the claim primarily seeks review
of Claimant’s application for privileges and Public Health Law
§§ 2801-b and 2801-c provide the exclusive remedy for a physician to
challenge a hospital’s actions in relation to an application for hospital
privileges. Defendant next argues that Claimant was never employed by the State
of New York as he had an unpaid faculty position with SUNYUMU, and was a paid
employee of two separate non-State entities, the Research Foundation and the
Medical Service Group. Alternatively, Defendant argues that even if Claimant
was an employee of the State, his employment was at-will employment terminable
at any time for any reason and he is not entitled to any compensation.
Finally, Defendant’s last argument is that Claimant was not terminated,
but voluntarily resigned.
As a preliminary matter the Court will address “Exhibit U” which
in support of its motion. Exhibit U purportedly contains all of the documents
and the determination by the Public Health Council in a proceeding pursuant to
Public Health Law
§ 2801-b. Claimant argues, in opposition, that those documents are
privileged and not subject to disclosure
seeks sanctions against the Assistant Attorney General for even presenting the
exhibit. Public Health Law § 2801-b, which authorizes a physician who
feels aggrieved by an improper denial of staff membership or privileges in a
hospital to file a verified complaint with the Public Health Council, also
provides that information received by the Public Health Council in investigating
the complaint “shall be kept confidential” and the records from any
proceedings “shall not be admissible as evidence in any other action of
any kind in any court or before any other tribunal, board, agency or
person.” (Public Health Law §2801-b). The statute clearly
requires the information received by the Public Health Council through its
investigation to be kept confidential. Thus, the documents or information
obtained by the Council and its procedures and deliberations thereon are
confidential (Public Health Law § 2801-b; Matter of Cohoes Mem. Hosp.
v Department of Health of State of N.Y.,
48 NY2d 583). The Court has not
considered Exhibit U.
Exclusivity of Statutory Grievance Process
There is no common law cause of action for a denial of staff privileges by a
private hospital (Moallem v Jamaica Hosp., 264 AD2d 621; Leider v Beth
Israel Hosp. Assn., 11 NY2d 205). Public Health Law §§
2801-b and 2801-c were enacted to provide some redress from a denial of
privileges and establishes a two-tiered system for review of a hospital’s
action on a physician’s hospital privileges. First, the physician may
file a complaint with the Public Health Council to investigate the circumstances
of the hospital’s actions. The Public Health Council will then make a
determination whether cause exists to credit the allegations in the complaint;
and if so, the Council will advise the hospital to review its actions regarding
the physician’s privileges (Public Health Law § 2801-b). Thereafter
the Supreme Court may enjoin violations or threatened violations of any
provision of Article 28 of the Public Health Law (Public Health Law §
An aggrieved physician seeking court intervention to direct a hospital to grant
or reinstate hospital privileges must first seek review by the Public Health
Council (Gelbard v Genesee Hospital, 87 NY2d 691). Only after
such review may a physician “bring a [PHL] section 2801-c injunction
action or any other valid claim.” (Id at 698). In an
injunction action brought in Supreme Court, any findings made by the Public
Health Council shall be prima facie evidence of the fact or facts found
therein (Public Health Law § 2801-c).
Here, we note initially that Claimant’s privileges were never actually
denied as he withdrew his application, but Claimant did bring a complaint before
the Public Health Council which was investigated and reviewed in accordance with
Public Health Law § 2801-b. The statutory requirement of threshold Public
Health Council review has been met (Id.). Claimant does not, nor could
he in this Court, seek an order directing the hospital to grant privileges.
Rather, Claimant seeks damages for a separate breach of contract, breach of the
covenant of good faith and fair dealing, and wrongful termination separate from
the likely denial of his hospital privileges (cf, Moallem v Jamaica Hosp.,
264 AD2d 621, 622). The Court has jurisdiction to hear such
Claimant bases his allegations in the claim for breach of contract on the
Medical Staff By-Laws of the hospital and on the letter offers of employment
dated November 5, 2003, from Dr. Chung T. Chung, and February 13, 2004, from Dr.
Gregory L. Eastwood. Claimant makes reference in the claim to a breach of an
unspecified section of the Medical Staff By-Laws. However, no breach of
contract action lies for breach of Medical Staff By-Laws unless the By-Laws
specifically authorize such action (Mason v Central Suffolk Hosp.,
There is no such authorization found in the By-Laws of SUNYUMU,
To the extent that the
claim seeks damages for breach of the provisions of the Medical Staff By-Laws,
it is not viable.
Defendant argues that Claimant was not an employee of the State of New York.
Pursuant to the offers of employment, Claimant was offered an unpaid, temporary,
faculty appointment with the SUNYUMU as Assistant Professor in the Department of
Radiation-Oncology. His salary was paid partially by the Research Foundation of
the State of New York and partially by the Department of Medical Services Group
Fund. Claimant’s W-2 Wage and Tax
for 2004 support the payment of
income from these two sources.
The issue of whether an employer-employee relationship exists is factually
based and goes beyond payment of compensation. Somewhat dependent upon the
context within which the issue arises, the focus is on the specific nature of
the relationship. Certain key factors distill whether the context is the Labor
Law, Unemployment Insurance Law, Workers’ Compensation Law, Human Rights
Law, or respondeat superior. Factors such as (1) selection and
engagement of the servant (2) the payment of salary, wages or fringe benefits,
(i.e., was the individual on the employer’s payroll?), (3) the right to
dismissal or discharge, (4) control over the servant’s work, including the
nature of the work, schedule, and furnishing of equipment have been found
relevant in determining whether an employer/employee relationship exists (see
and compare State Div. of Human Rights v Board Coop. Educ. Servs., 98 AD2d
958; State Div. of Human Rights v GTE Corp., 109 AD2d 1082 [within
context of Executive Law]; Theodoreu v Chester Fire Dist., 12 AD3d
499; Matter of Semus v University of Rochester, 272 AD2d 836; Matter
of Tully v Live Right Realty Corp., 36 AD3d 1108 [Workers’
Compensation Law]; Bynog v Cipriani Group, Inc., 1 NY3d 193; Stringer
v Musacchia, 46 AD3d 1274 [Labor Law]; Matter of Charles A. Field
Delivery Serv., 66 NY2d 516 [Unemployment Insurance Law]; Theodoreu v
Chester Fire Dist., 12 Ad3d 499 [Volunteer Firefighters’ Benefit
No factor alone is determinative, however, control over the servant and the
work being done seem to be the most critical. A few cases provide particular
guidance. In State Div. of Human Rights v GTE Corp., 109 AD2d 1082, the
petitioner applied for employment as a keypunch operator with GTE and was
interviewed by GTE employees. The petitioner was accepted for employment by the
GTE employees. Petitioner was on the payroll of an employment agency. GTE,
however, set petitioner’s pay rate and determined her hours of employment.
The petitioner had no contact with the employment agency. The Court found that
despite the fact the petitioner was not on the GTE payroll, GTE was her employer
as GTE exercised the power and control over her job duties and power of
dismissal. Similarly, under facts very similar to those present here, in
Matter of Palmer v State Univ. of N.Y. Upstate Med. Univ., 14 AD3d 737,
738, lv denied 5 NY3d 717, an orthopedic hand surgeon provided
“volunteer” services as a clinical professor at SUNYUMU while he was
paid by the Research Foundation which received its funds from the Orthopedic
Medical Services Group, an orthopedic practice group created by the university
in which Claimant maintained a private practice. The members of the practice
group served as the University’s Department of Orthopedic Surgery faculty.
Since the university created this “web of relationships to enable it to
receive the benefit of [the physician’s] services” the Court found
“substantial evidence” to support the Workers’ Compensation
Board’s findings that the physician was a dual employee of the both the
university and the foundation (Matter of Palmer v State Univ. of N.Y. Upstate
Med. Univ., 14 AD3d 737, 738).
In this case, the facts are not in dispute and the intricate relationship
between the SUNYUMU, University Hospital, the Research Foundation, and the
Medical Service Group is evident from the testimony of Dr. Chung, and the
Defendant’s other submissions.1
purpose of the Research Foundation is to develop and increase the facilities of
The purpose of the Medical Service
Group is to provide financial support for the development and growth of the
clinical departments, expenses of practice, and academic mission of
SUNYUMU is required by statute
and regulations to plan for the management of clinical practice income, which
includes the formation of the Medical Service Group by each school of medicine,
along university guidelines.1
The dean of
SUNYUMU must approve all new positions in the Department of Radiation-Oncology.
All physicians in the Department of Radiation-Oncology are members of the
Medical Service Group and all members of the Medical Service Group are part of
the Department. To be in the Medical Service Group, the physician must first
have a faculty appointment. Financing for the Department of Radiation-Oncology
at SUNYUMU comes from the State and the Medical Service Group. The money for
the Research Foundation comes from grants and the Medical Service Group. Here,
SUNYUMU through Dr. Chung T. Chung, as Chair of the Department of
Radiation-Oncology at SUNYUMU and Dr. Gregory Eastwood, as President of SUNYUMU,
made the offers of employment to Claimant. In offering Claimant the positions
with the Research Foundation and the Medical Service Group, Dr. Chung did not
seek or need the approval of anyone else, although it was Dr. Eastwood’s
letter which actually extended the offer for a faculty appointment with SUNYUMU.
Dr. Chung and the dean of SUNYUMU determine salary and approve all salary
increases. Dr. Chung had the power to terminate Claimant. Although it was
clearly delineated by the letter offers that the payment of Claimant’s
salary was not the responsibility of SUNYUMU, Claimant’s job duties and
responsibilities for all the positions were presented by SUNYUMU employees.
Even more notable is that once Claimant submitted the resignation of his faculty
position and the position with the Research Foundation, Dr. Chung considered it
to also be a resignation from the Medical Service Group. As Dr. Chung testified
to the interrelationship between credentialing, the faculty position, and the
Medical Service Group position he agreed “[i]t is all three or
The positions with the
Research Foundation and the Medical Service Group are contingent on maintaining
a faculty position at SUNYUMU.
Although, the Research Foundation is not an arm of the State (see Turner v
State of New York, 49 AD2d 269 vacated by 52 AD2d 671) given the
undisputed circumstances here, there is only one conclusion that may be drawn
and the Court finds that Claimant was an employee of the State as well as the
Research Foundation and the Radiation-Oncology Medical Service Group.
The law is very clear that absent an agreement establishing employment for a
fixed duration, an employment relationship is a hiring at will, which may be
terminated at any time for any reason (Sabetay v Sterling Drug, Inc., 69
NY2d 329, 333; Lobosco v New York Tel. Co./NYNEX, 96 NY2d 312, 316;
Horn v New York Times, 100 NY2d 85, 90; Martin v New York Life Ins.
Co., 148 NY 117). Defendant argues that despite the six-month notice of
termination clause, which referenced only termination as a faculty member, there
was no fixed duration for termination and no limit on either party’s
unfettered right to end the relationship. The notice provision, according to
Defendant, only established the effective date of the termination.
Defendant cites in support of its position Zolotar v New York Life Ins. Co.,
172 AD2d 27. However, this Court finds that the facts of
Zolotar set it apart from the circumstances here. Mr. Zolotar entered
into a contract of employment which specified that either party “may, with
or without cause, terminate this contract upon written notice, said termination
to become effective thirty days after the day on which such notice is
dated.” (Zolotar, 172 AD2d at 28). The Court refers to the
contract as an at-will relationship because there is no limitation of any kind
in duration or purpose to the unfettered right to terminate employment. The
critical difference here is that the employer gave the employee a letter
terminating their relationship without cause effective 30 days thereafter, in
full compliance with the terms of the contract and thus since the terms of the
contract were met, the employer had the full and unfettered right to terminate
the employee's services without cause (see also Gazzola-Kraenzlin v
Westchester Med. Group, P.C., 10 AD3d 700; and Lynch v Upper Crust,
294 AD2d 237). Although reference to such a case as “at-will”
muddies the linguistic waters when other courts refer to at-will employment as
“permit[ing] either party to terminate the employment relation without
advance notice...” (Kotick v Desai, 123 AD2d 744, 745
[emphasis supplied]; see also Evans v Ithaca Urban Renewal Agency,
205 AD2d 844, 846). In effect, when the terms of the contract’s
notice provisions have been met, the employment is at-will. Here, however, if
Claimant was terminated, which will be addressed forthwith, he was entitled by
the terms of the contract to six-months notice, which effectively restricted the
time frame within which Defendant could terminate Claimant. Moreover, since the
position as a faculty member along with the positions at the Research Foundation
and the Medical Service Group were intricately connected, such that Claimant
could not have been discharged from just his faculty position, and continued
with his position with the Research Foundation or the Medical Service Group, the
terms applied to all the positions.
Resignation or Termination
It is Defendant’s position that Claimant was never terminated, he
resigned. This, at least on its face, is accurate based upon Claimant’s
letters withdrawing his application for privileges dated April 5, 2004, and
resigning from his faculty position and the Research Foundation by letter dated
April 6, 2004.1
However, it is Claimant’s position that the letters of resignation were
not voluntary but were coerced and he was, in essence terminated. Claimant
argues that the State, through Dr. Chung, improperly threatened that if he did
not withdraw his application for medical staff privileges that his application
would be denied and the denial would have to be reported to the OPMC. Since
such a denial of privileges and a potential report to the State would likely
negatively impact his medical career, he was left with no choice but to withdraw
his application for privileges and resign his positions.
Although, normally, whether a resignation is voluntary or coerced would be a
question of fact; here, the undisputed facts permit the Court to rule as a
matter of law (see Matter of Manel v Mosca, 216 AD2d 468; Matter of
Gilliam v New York City Dept. of Sanitation, 18 Misc 3d 1141[A]). The
undisputed facts establish that Claimant applied for hospital privileges with
University Hospital. The process which normally takes three months or more was
begun in December. The hospital required primary verification from all sources
to substantiate all aspects of the applicant’s education and experience.
It is the statutory obligation of the hospital on an application for hospital
privileges to make inquiry and seek verification of information relating to the
applicant’s prior training, employment, association or professional
privileges, or any actions which the applicant may have taken to avoid
disciplinary action, any conviction of a crime, professional misconduct, or
mental or physical impairment, incompetence, malpractice, or impairment of
patient safety or welfare (Public Health Law § 2803-e  [a] and [b]).
After months of trying by the Medical Staff Office sufficient information could
not be obtained and, according to the undisputed testimony of Dr. Numann and
Mary Ann Merklein, there was no indication that it was a matter of requiring
more time: the information would not be forthcoming. The Credentialing
Committee met and referred the matter to the Medical Executive Committee without
making a recommendation to grant or deny privileges. It was clear from Dr.
Numann’s testimony, and as a member of the Medical Executive Committee,
that if the application information was not complete, privileges would not be
granted. The Medical Executive Committee was required, if privileges were
denied, to specify the reason for the denial, and based upon the reason set
forth, it would then be determined whether a report was needed to be made to
OPMC. If it was questionable, an inquiry would be made to OPMC as to whether a
report was required. It is Claimant’s position that no report was
required if the basis for the denial was an incomplete report, and Dr. Numann
confirmed this and testified that she could not recall any other case where
privileges were denied because of an incomplete application.
Public Health Law § 2803-e  [a] requires that “[h]ospitals and
other facilities approved pursuant to this article shall make a report or cause
a report to be made within thirty days of the occurrence of any of the
following:...the denial of staff privileges to a physician if the reasons stated
for such denial are related to alleged mental or physical impairment,
incompetence, malpractice, misconduct or impairment of patient safety or
welfare.” The policies of Upstate Medical Hospital relating to the
reporting of an action affecting hospital privileges are consistent with the
From the testimony, it is clear
that both Dr. Chung and Mary Ann Merklein were of the opinion that if
Claimant’s application for privileges were denied, a report would have to
be made. Dr. Numann and Molly Zimmermann, counsel for Upstate Medical
University, were of the opinion that a report might have to be made and an
inquiry would have to be made as to whether a report was required under these
circumstances. Dr. Numann referred to such a situation as a “very odd and
Dr. Numann and Molly
Zimmermann, along with the CEO of University Hospital, would have made the
determination of whether a report to OPMC was required.
Coercion is defined as “[c]ompulsion; constraint; compelling by force or
arms or threat (Black’s Law Dictionary, p. 258 [6th ed. 1990]).
It can be physical or mental but it effectually deprives the individual of his
or her free will to act (Id.). The Courts have consistently held that
merely requiring a person to make an uncomfortable or unpleasant choice between
two legal and viable positions is not coercive (see Matter of Cacchioli v
Hoberman, 31 NY2d 287, 292, Jasen, J., concurring opinion;
Matter of DeMarco v McLaughlin, 69 AD2d 882, affd 49 NY2d 941;
Matter of Hopkins v Governale, 222 AD2d 435,436; Matter of Wolfe v
Jurczynski, 241 AD2d 88, 90-91; Doyle v Trinity Church, 133 NY
372; Levitz v Robbins Music Corp., 6 AD2d 1027; but compare Rychlick v
Coughlin, 99 AD2d 863; Matter of Willis v VonHolden, 67 AD2d 810).
“[A] person’s resignation may not be considered to be obtained under
duress unless the employer threatened to take action which it had no right to
take.” (Matter of Cacchioli v Hoberman, 31 NY2d 287, 292,
Jasen, J., concurring opinion; Matter of Hopkins v Governale,
222 AD2d 435,436; Wolfe v Jurczynski, 241 AD2d 88, 90-91). Here,
Defendant had the obligation to inquire into Claimant’s education,
employment, and association history for purposes of granting or denying hospital
privileges. The hospital did not receive the information it required. Without
the required information, if the Medical Executive Committee had proceeded to
consider Claimant’s application, it, more than likely, would have been
denied. This result would have been, at the very least, submitted to the OPMC
for advisement as to whether a report should be made for the denial of
privileges. Claimant, understandably, wanted to avoid a denial of privileges.
The fact that the choice presented to Claimant was unpalatable does not equate
with duress or coercion. It is worthy to note that Claimant was represented by
counsel at the time.
Accordingly, under the circumstances presented here, based upon the undisputed
facts, the Court does not find that Defendant terminated Claimant, but rather
that Claimant voluntarily, albeit with limited options, resigned his position
with the State. Given his resignation, Claimant’s causes of action for
breach of contract, wrongful termination, and breach of the covenant of good
faith and fair dealing must fail. Defendant’s motion is GRANTED, the
claim is DISMISSED and Claimant’s motion is hereby DENIED.
October 8, 2008
HON. DIANE L. FITZPATRICK
Judge of the Court of Claims
The Court has considered the following documents in deciding these
1) Notice of Motion.
2) Affirmations of Patricia M. Bordonaro, Esquire, Assistant Attorney
General, and Molly Zimmermann, Esquire, in support, with exhibits attached
3) Defendant’s Memorandum of Law in Support of Summary Judgment.
Affidavit in opposition to Defendant’s motion of Sarah Lichtenstein,
Esquire, sworn to June 11, 2008, with exhibits attached thereto and Memorandum
6) Affidavit of Sarah C. Lichtenstein, Esquire, sworn to May 9, 2008, Affidavit
of Huibert M. Vriesendorp, M.D., sworn to April 10, 2008, and Affidavit of Jeff
Scott Olson, Esquire, sworn to April 10, 2008, in support, with exhibits
attached thereto, and Memorandum of Law.
7) Reply Affidavit of Sarah C. Lichtenstein, Esquire, in further support of
Claimant’s Motion for Summary Judgment sworn to June 17, 2008, with
exhibit and Memorandum of Law.
8) Attorney’s Affirmation in response and opposition of Claimant’s
motion of Patricia M. Bordonaro, Esquire, Assistant Attorney General.
. Defendant’s Exhibit L.
. Defendant’s Exhibit N.
. Defendant’s Exhibit M.
.Defendant’s Exhibit D, page 17.
. Defendant’s Exhibit AA, page 122,
.Defendant’s Exhibit AA, page 124, lines
.Claimant, by letter dated May 19, 2008,
opposed the disclosure of Exhibit U and seeks sanctions. Although this was not
made as a formal request by motion, the Court declines to impose
.Claimant’s Medical Service Group Fund
W-2 is from the University Hill Radiation-Oncology, LLP.
Exhibits AA, SUNY Board of
Trustees policies, the Agreements between SUNY and the Research Foundation and
Clinical Practice Management Plan Governing Board.
Defendant’s Exhibit H,
Defendant’s Exhibit I,
Defendant’s Exhibit I,
Upstate Medical University Governing Board, Statement of Principles, page 1,
. Defendant's Exhibit AA, page 132, lines
Claimant’s Exhibits K
.Defendant’s Exhibit F.
. Defendant’s Exhibit X, page 56,