Opinion
64419
07-17-2019
NY GO EXPRESS, INC., d/b/a GOexpress, and Subcontracting Concepts, LLC, Petitioners, v. NEW YORK STATE INSURANCE FUND, Respondent.
Peter Fidopiastis, Queensbury, for petitioners. Letitia James, Attorney General, Albany (Shannon C. Krasnokutski of counsel), for respondent.
Peter Fidopiastis, Queensbury, for petitioners.
Letitia James, Attorney General, Albany (Shannon C. Krasnokutski of counsel), for respondent.
Robert J. Muller, J.
The facts of this case are fully set forth in the Court's earlier decision and will not be repeated at length. Briefly, petitioner NY GO Express, Inc. (hereinafter NY GO) — a logistics broker — had an insurance policy with respondent for the period of December 31, 2014 to December 31, 2015. On June 19, 2016, respondent conducted an audit and determined that $574,968.00 was paid to Naipaul Trucking (hereinafter Naipaul) and $224,920.00 was paid to Nate's Management Services, Inc. (hereinafter Nate's Management) — two commercial carriers commissioned by NY GO — during the policy period. As a result, respondent advised NY GO that it would be assessed additional premiums in the amount of $55,871.02 unless it demonstrated that Naipaul and Nate's Management had workers' compensation coverage during this period.
In response, petitioner Subcontracting Concepts, Inc. (hereinafter SCI) — a third party administrator acting on behalf of NY GO — submitted certificates of insurance listing it as the insured and Naipaul and Nate's Management, respectively, as the certificate holders. Respondent, however, found that the certificates of insurance failed to provide sufficient proof of coverage and requested that SCI provide an analysis of NY GO's relationship with Naipaul and Nate's Management under the New York State Goods Transportation Industry Fair Play Act (see Labor Law art 25-C [hereinafter the Fair Play Act] ). This analysis was provided on July 26, 2016, but respondent remained unconvinced that Naipaul and Nate's Management had coverage during the policy period. Respondent then advised that it was adhering to its original decision to assess the additional premiums on September 2, 2016.
In accordance with the provisions of NY GO's insurance policy, SCI sent correspondence to the New York Compensation Insurance Rating Board (hereinafter the Rating Board) on October 25, 2016 requesting that respondent's September 2016 determination be vacated. By written decision dated November 16, 2016, the Rating Board denied the request and sustained the ruling. SCI then requested a conference with members of the Rating Board staff but received no response, as the result of which petitioners commenced this CPLR article 78 proceeding seeking to vacate the September 2016 determination. By Decision, Order and Judgment dated May 30, 2018, the Court found that the determination was supported by a rational basis and dismissed the petition in its entirety ( 60 Misc 3d 536 [Sup Ct, Warren County 2018] ). Presently before the Court is petitioners' combined motion for leave to renew and leave to reargue relative to the Decision, Order and Judgment.
Turning first to that aspect of the motion which seeks leave to renew, to succeed on such a motion petitioners must "provide new facts that would change the prior determination as well as a justifiable excuse for not providing such facts earlier" ( Hurrell—Harring v. State of New York , 112 AD3d 1217, 1218 [2013] ; see CPLR 2221[e] ).
Here, in an effort to remedy certain deficiencies noted by the Court in its Decision, Order and Judgment, petitioners have submitted affidavits from the owner of Naipaul, the owner of Nate's Management, the president and chief executive officer of NY GO and an agent of Protective Insurance Company — all of which present new facts. Petitioners contend that they have a justifiable excuse for failing to submit these affidavits earlier, namely that respondent failed to insist that the appeal be heard by the Rating Board in accordance with the procedures set forth in the insurance policy and such failure "prevented them from submitting evidence in a form that would have made an adequate factual record."
The Court is not persuaded. This issue was addressed in the Decision, Order and Judgment, with the Court stating as follows:
"The Court must take this opportunity to note that it is troubled by the Rating Board's failure to respond to SCI's request for a conference. If the Rating Board had followed the appeals procedure set forth in NY GO's policy and held a conference — as well as a hearing, if necessary— then the record would be far more developed. Petitioners would have had the opportunity to present additional evidence. The Court in fact considered adding the Rating Board as a necessary party under CPLR 1001 so the matter could perhaps be remitted. The Court ultimately decided against it, however, as petitioners had the opportunity to present any missing evidence in the context of this proceeding and failed to do so. Indeed, as expressly stated in the petition: ‘[Respondent] has refused to participate in its own administrative review process and prevented the creation of an administrative record. Therefore, [the] Court may decide the matter based on the evidence submitted by the parties’ " ( 60 Misc 3d at 548 ).
Under the circumstances, petitioners were not prevented from presenting the requisite evidence. Rather, they were given ample opportunity to present such evidence in the context of the proceeding and failed to do so. "[A] motion to renew is ‘not a second chance to remedy inadequacies that occurred in failing to exercise due diligence in the first instance’ " ( Howard v. Stanger , 122 AD3d 1121, 1123 [2014], lv dismissed 24 NY3d 1210 [2015], quoting Onewest Bank, FSB v. Slowek , 115 AD3d 1083, 1083 [2014] [internal quotation marks and citation omitted] ). Petitioners have thus failed to present a justifiable excuse for their failure to submit these affidavits earlier. As a result, the issue of whether the new facts contained therein would change the Court's prior determination need not be considered.
Based upon the foregoing, the aspect of the motion which seeks leave to renew is denied.
Turning now to that aspect of the motion which seeks leave to reargue, to succeed on such a motion petitioner must demonstrate that the Court "overlooked significant facts or misapplied the law in its original decision" ( Matter of Town of Poestenkill v. New York State Dept. of Envtl. Conservation , 229 AD2d 650, 650 [1996] ; see CPLR 2221[d] ; Greene Major Holdings, LLC v. Trailside at Hunter, LLC , 148 AD3d 1317, 1318-1319 [2017] ; Matter of Ellsworth v. Town of Malta , 16 AD3d 948, 949 [2005] ).
Here, petitioners contend that the Court misapplied the law in its original decision by failing to give the verified petition the weight to which it was entitled under CPLR 105 (u), which provides that "[a] ‘verified pleading’ may be utilized as an affidavit whenever the latter is required."
Again, the Court is not persuaded. The verified petition was given the weight to which it was entitled; it simply failed to set forth facts sufficient to demonstrate that respondent's determination was arbitrary and capricious. Indeed, it was verified by the Vice President of Client Services for SCI, who could not possibly have had personal knowledge of all of these facts. As discussed above, petitioners have actually recognized and attempted to remedy the defects in the verified petition by moving for leave to renew.
Under the circumstances, the aspect of the motion which seeks leave to reargue must also denied.
Therefore, having considered the Affirmation of Peter Fidopiastis, Esq. with exhibits attached thereto, dated June 29, 2018, submitted in support of the motion; Memorandum of Law of Peter Fidopiastis, Esq., dated June 29, 2018, submitted in support of the motion; Affidavit of Phyllis Martin, sworn to August 24, 2018, submitted in opposition to the motion; Memorandum of Law of Shannon C. Krasnokutski, Esq., dated August 31, 2018, submitted in opposition to the motion; and Reply Memorandum of Law of Peter Fidopiastis, Esq., dated September 5, 2018, and oral argument having been held on July 16, 2019 with Peter Fidopiastis, Esq. appearing on behalf of petitioners and Shannon C. Krasnokutski, Esq. appearing on behalf of respondent, it is hereby
Attached as exhibits to this Affirmation are the Affidavit of Naipaul Ramkaran with attachments thereto, sworn to June 26, 2018; Affidavit of Melvin Tortorelli with attachments thereto, sworn to June 26, 2018; Affidavit of Vincent Malerba with attachments thereto, sworn to June 11, 2018; and Affidavit of Jane Peacock, sworn to June 28, 2018.
ORDERED that petitioners' combined motion for leave to renew and leave to reargue is denied in its entirety.
The original of this Decision and Order has been filed by the Court together with the Notice of Motion dated June 29, 2018 and the submissions enumerated above. Counsel for respondent is hereby directed to promptly obtain a filed copy of the Decision and Order for service with notice of entry upon petitioners in accordance with CPLR 5513.