Opinion
# 2017-040-074 Claim No. 122096
06-26-2017
DAVID E. SHAFFER v. THE STATE OF NEW YORK
Steven J. Borofsky, Esq. ERIC T. SCHNEIDERMAN Attorney General of the State of New York By: Thomas R. Monjeau, Esq., AAG Paul F. Cagino, Esq., AAG Steven J. Borofsky, Esq.
Synopsis
Court finds that Claimant failed to establish by a preponderance of the credible evidence that Defendant: breached a covenant of Good Faith & Fair Dealing; was unjustly enriched; violated Claimant's Civil Rights; or defamed Claimant.
Case information
| UID: | 2017-040-074 |
| Claimant(s): | DAVID E. SHAFFER |
| Claimant short name: | SHAFFER |
| Footnote (claimant name) : | |
| Defendant(s): | THE STATE OF NEW YORK |
| Footnote (defendant name) : | Caption amended to reflect the State of New York as the proper defendant. |
| Third-party claimant(s): | |
| Third-party defendant(s): | |
| Claim number(s): | 122096 |
| Motion number(s): | |
| Cross-motion number(s): | |
| Judge: | CHRISTOPHER J. McCARTHY |
| Claimant's attorney: | Steven J. Borofsky, Esq. |
| Defendant's attorney: | ERIC T. SCHNEIDERMAN Attorney General of the State of New York By: Thomas R. Monjeau, Esq., AAG Paul F. Cagino, Esq., AAG |
| Third-party defendant's attorney: | |
| Signature date: | June 26, 2017 |
| City: | Albany |
| Comments: | |
| Official citation: | |
| Appellate results: | |
| See also (multicaptioned case) |
Decision
For the reasons set forth below, the Court finds that Claimant, Dr. David E. Shaffer, failed to establish, by a preponderance of the credible evidence, his Claim against the State of New York. A bifurcated trial of the Claim, addressing liability issues only, was held on November 17, 2015, and May 17-18, 2016, at the Court of Claims in Albany, New York. There were six witnesses: Claimant; Johnny Guadalupe, a tax compliance agent for the New York State Department of Taxation and Finance (hereinafter, "DTF") ; Dominick DiGennaro, a New York City Police Detective (hereinafter, "Det.") assigned to the office of the Queens County District Attorney (hereinafter, the "Queens DA"); Martha Perlson, a DTF field auditor; Neil F. Gitin, Esq., who has been an Assistant District Attorney (hereinafter, "ADA") in the Queens DA's office since 1985; and Elaine Wallace, a DTF lawyer since 1985, who has managed the bankruptcy and criminal restitution section in civil enforcement since 2000. Thereafter, the parties were granted additional time to order a transcript and then submit post-trial memoranda. FACTS
Claimant is a podiatrist whose office is in Flushing, New York. He had not filed personal income tax (hereinafter, "PIT") returns for tax years 1999-2007 but, when DTF opened a case on Dr. Shaffer in 2008 as part of a larger project concerning licensed professionals who had not filed PIT returns, the statute of limitations already had expired for 1999-2001 (see Ex. 8 [DTF Case Summary]; May 2016 transcript [hereinafter, "May Tr."], pp. 349-350). Ms. Perlson worked on the portion of the case relating to Dr. Shaffer's failure to file PIT returns for tax years 2002-2007.
Nevertheless, by 2003 or 2004 Dr. Shaffer was paying DTF $300 per month for tax years 1999-2001 (May Tr., pp. 39-41, 349-350; Ex. 4). In 2009, Claimant also set up another agreement with Mr. Guadalupe, pursuant to which Claimant paid a variable amount of about $200-$300 per month (May Tr., pp. 42, 63).
In March 2009, DTF met with ADA Gitin, who headed a specialized economic crimes bureau in the Queens DA's office, and Claimant's case was accepted for prosecution. Det. DiGennaro was assigned to investigate.
Claimant testified that, in November 2009, he gave an offer in compromise (hereinafter, an "OIC") to Mr. Guadalupe that covered 2002-2008, but the DTF agent could not recall receiving it. Mr. Guadalupe also said that he was not working on Dr. Shaffer's PIT issues, but rather a separate investigation of business liabilities he may have had for withholding and sales taxes (see Ex. 35 [income execution Mr. Guadalupe requested with respect to tax warrants filed in 2002-2004]). Later, Ms. Perlson said she learned that an OIC had been filed and rejected (May Tr., pp. 336-338). It is not clear to the Court, however, if Ms. Perlson's answer is responsive to the specific question about the 2009 OIC, or is responsive to the discussion of OICs generally, which preceded it. She also observed that DTF could not accept an OIC in a case, like Claimant's at that time, where the taxpayer's liability had yet to be determined. In any event, Dr. Shaffer said that Mr. Guadalupe advised him in December 2009 that his case, including his OIC, had been transferred to DTF's fraud unit.
On January 7, 2010, Claimant was arrested on a Criminal Court Complaint charging him with four Class E felony counts of repeated failure to file PIT returns for 2002-2007, and four misdemeanor counts of failure to file and pay PIT returns (see Ex. 1 [hereinafter, the "Criminal Complaint"]). The Criminal Complaint was filed in the Criminal Court of The City of New York, Queens County (hereinafter, "Queens Criminal Court"). ADA Gitin drafted the Criminal Complaint, based upon information provided to him by DTF, including Ms. Perlson (May Tr., p. 385). Det. DiGennaro signed the Criminal Complaint and Ms. Perlson was listed as the source of the information contained in it, although she testified that she could not recall having any direct communication with Det. DiGennaro (May Tr., pp. 342-343; Ex. 30, p. 32; see Ex. 1).
The Criminal Complaint asserts that Claimant had an unpaid tax liability for each of the tax years 2002-2007 (Ex. 1). It further states that, on or about October 17, 2008, Claimant filed a delinquent PIT return for tax year 2007 and that, on or about December 10, 2008, he filed delinquent PIT returns for tax years 2002, 2003, 2004, 2005, and 2006. The parties agreed that those PIT returns were accepted by DTF without any material changes. The total unpaid tax liability indicated in the Criminal Complaint was $13,419. The Criminal Complaint also states that Claimant remitted no payments with the PIT returns filed on December 10, 2008, even though DTF data revealed that he earned income in each of those tax years. Finally, it asserts that Claimant did not request extensions to file his PIT returns, and did not have permission or authority to fail to file them, when and as required, for tax years 2002-2007.
($2,431[2002]+$1,141[2003]+$5,177 [2004]+$2,385 [2005]+$288 [2006]+$1,997 [2007]=$13,419).
A DTF press release issued the same day as his arrest, January 7, 2010, identified Claimant by name, age, and office location, as one of 18 individuals arrested "on tax evasion charges" for "not filing tax returns over multiple years" (Ex. 20). It recited the charges against Dr. Shaffer and noted that, if convicted, he faced up to four years in State prison. It further stated that Claimant earned $253,324 during that period and failed to pay $13,419 in State income taxes. In an undated e-mail to Ms. DiPietro, a lawyer in DTF's special investigations unit, Ms. Perlson asked whether Claimant should be included in the press release since he had, by then, filed delinquent PIT returns (Ex. 11). Dr. Shaffer asserted that the press release was untrue insofar as he did file his PIT returns in 2008, and that the press release forms the basis for his defamation claim (May Tr., pp. 28-30, 187). At her examination before trial (hereinafter, "EBT," conducted on August 16, 2013), Ms. Perlson agreed that the statements that Claimant failed to file PIT returns for 2003-2007 were incorrect as of January 7, 2010 (Ex. 30, pp. 30-32). At trial, however, Ms. Perlson said that the e-mail was a "mistake" on her part, sent because she was seeking information to educate herself as a member of the criminal investigations team (May Tr., pp. 278).
On January 22, 2010, Claimant's lawyer, Mr. Borofsky, wrote Ms. Perlson to request "a statement of the total amount owed by Dr. Shaffer broken out by year, with [the] amount of tax, penalty and interest for each year, so that we may resolve the outstanding liability with the State of New York" (Ex. L). The letter also included a proposed settlement with the Queens DA's office. Ms. Perlson prepared draft Consents to Field Audit Adjustment (each hereinafter, an "Adjusted Consent") which set forth for Claimant and his counsel the liabilities DTF was asserting against Dr. Shaffer (May Tr., pp. 358-359; see, i.e., Ex. 33, pp. 3, 12-14). ADA Gitin said that he and DTF's Ms. DiPietro negotiated a plea deal with Claimant (May Tr., p. 393).
On March 2, 2010, Claimant appeared with Mr. Borofsky in Queens Criminal Court for an allocution at which the Queens DA made an offer in order to resolve the matter, pursuant to which Claimant pleaded guilty to one misdemeanor count of failure to file a tax return (see Ex. 2 [Transcript of Proceeding]). Ms. Perlson and Ms. DiPietro were present in court, but were not part of the prosecution team and did not speak (November 2015 Transcript [hereinafter, "Nov. Tr."], pp. 48-49; May Tr., pp. 367-368). During that proceeding, Claimant agreed: that no one forced him to plead guilty; that he had the opportunity to discuss the plea with his attorney; and that no promises had been made to him, other than the promise that he would be sentenced to three years' probation, with the additional conditions that he consent to any searches by the New York City Department of Probation (hereinafter, the " NYC Probation Department"), and that he pay restitution in the amount of $13,440, in 24 monthly payments of $560 each, plus a 5% fee (Ex. 2). The case was adjourned so that a pre-sentence report could be ordered and prepared.
ADA Leslie McCarron, Esq., who appeared on behalf of the Queens DA, initially had stated a higher amount of restitution ($23,867), after which counsel approached the bench (see Ex. 2). Claimant testified that the $23,867 amount included penalties and interest, but the final amount was reduced to the amount of the PIT owed (Nov. Tr., pp. 43-46; May Tr., pp. 244-245; see Ex. 26 [Adjusted Consent, dated March 1, 2010, stated that total tax, penalties and interest owed was $23,870]).
Claimant thought that the restitution constituted the total amount he was required to pay, and said that he never agreed to pay penalties and interest and, for that reason, refused to sign the March 1, 2010 Adjusted Consent (May Tr., pp. 86-87). ADA Gitin testified, however, that he never told Claimant's counsel that the restitution amount included penalties and interest, and that Mr. Borofsky did not ask if they were, or argue that they should be, included (May Tr., pp. 393-394).
Dr. Shaffer said that, but for ADA Gitin's letter, dated January 19, 2009, he would not have entered into the plea agreement and, instead, would have pleaded innocent to the charges (Nov. Tr., p. 47; May Tr., p. 154). The Gitin letter states that the Queens DA's office would not assure Claimant that his professional license would be unaffected by the criminal proceeding, although the ADA also said that, in his experience, the State took no such action if the matter did not involve the actual practice of the licensed profession (Ex. 5). The letter did state that the Queens DA would not act against his license, so long as Dr. Shaffer remained current on his restitution payments. Claimant testified that his license was affected, however, and that a $10,000 fine was imposed by the New York State Department of Education (hereinafter, the "Education Department"), his license was suspended for one month, and then he was placed on probation for three years (May Tr., p. 155). The letter also stated that ADA Gitin would not provide Claimant with a letter of satisfaction until Claimant fully paid his "unpaid tax liability" (Ex. 5).
While Exhibit 5 clearly is dated January 19, 2009, the Court questions if it was misdated, as sometimes occurs, early in a new year, and that it actually may have been written in January 2010. A date after Claimant's arrest, during the period when Mr. Borofsky was gathering information about the amounts DTF asserted that Dr. Shaffer owed (see Ex. L), and only several weeks prior to the plea agreement set forth at the March 2, 2010 allocution, the outlines of which are described in the Gitin letter, all would appear to comport better with the time line that has been established. The Court further notes, however, that the date of the Gitin letter is of no consequence to the Court's decision in this Claim.
Immediately after the allocution and plea, Claimant and Mr. Borofsky met with DTF's Ms. Perlson and Ms. DiPietro in a hallway at the courthouse to further discuss the income tax owed, as well as penalties and interest (May Tr., pp. 368-373). Ms. Perlson prepared an Adjusted Consent, dated March 1, 2010, for that conversation (see Ex. 33, p. 12). At the meeting, DTF stated its position that Claimant was required to pay the back income tax owed plus penalties and interest, but offered to reduce the total liability by reducing the fraud determination.
Ms. Perlson explained that, while the negligence penalty was equal to 5% of the tax owed, the fraud penalty was equal to 50% of the tax, plus 50% of the interest owed. The March 1 draft Adjusted Consent had assessed the fraud penalty against tax year 2005, which was an average year. In the March 2 revised draft Adjusted Consent [see below], the fraud penalty was imposed against a year, 2006, in which the tax was lower (May Tr., pp. 371-373).
The next day, March 3, 2010, Ms. Perlson forwarded to Mr. Borofsky a revised Adjusted Consent, dated March 2, 2010, which stated the total tax, penalties and interest owed for tax years 2002 through 2007 as $22,928 (Ex. 33, pp. 2-3). Claimant testified that Ms. Perlson provided him with similar draft Adjusted Consent forms at least three or four times, with different amounts owed each time, but he never signed any of the paperwork and believed that, by not doing so, he would not owe penalties and interest (May Tr., pp. 197, 253).
Claimant said that he filed a second OIC because the first one had not been decided, or was with DTF's fraud unit (May Tr., p. 245). The second OIC, the only one in evidence (see Ex. 34, pp. 11-28), was dated and signed by Claimant on April 22, 2010 (id., pp. 14, 23), and was stamped as received on April 26, 2010 by DTF's tax compliance bureau/OIC (id., pp. 11, 16, 24, 28). The space on the OIC form provided for the taxpayer to indicate the amount being offered to compromise the liabilities was left blank, and the record of liabilities and payments space refers to an attached copy of the March 2, 2010 draft Adjusted Consent, which stated that total tax, penalties and interest owed was $22,928 (Ex. 34, pp. 11-12). Claimant included a money order with the second OIC for $100, which, he testified, was an opening offer to spur negotiations (May Tr., p. 246; Ex. 34, pp. 34-36).
Claimant asserted that DTF neither contacted him about the second OIC, nor did it request any additional information to supplement it (May Tr., p. 245). On June 10, 2010, however, DTF's Collection and Enforcement Division wrote to Claimant's accountant advising that the agency could not entertain Dr. Shaffer's OIC because an audit was in progress, and because the OIC was incomplete, including the failure to offer an actual monetary amount to settle the debt (Ex. 34, pp. 29-30). Claimant said that his accountant never gave him a copy of the letter (May Tr., p. 262). Dr. Shaffer also was copied on the letter, but said that he never received it (May, Tr., p. 270). The letter did say that DTF would be willing to consider a complete OIC after the audit was completed. Claimant never followed up with his accountant about the OIC, nor, to his knowledge, were any further efforts made on his behalf to compromise or settle with DTF after his OIC was rejected in June 2010 (May Tr., pp. 210, 262-263).
Claimant also said that he filed an OIC with the Internal Revenue Service with respect to his unpaid federal tax liabilities which, he believed, extended the filing deadline for his Federal PIT returns until 2010 or 2011. He also believed that he could not file his New York PIT returns until after his Federal returns had been filed. Claimant said that he filed both his Federal, as well as his State PIT returns in 2008.
On April 23, 2010, Ms. Perlson sent an e-mail to Ms. DiPietro noting that the payments contemplated by the proposed plea agreement only covered the PIT owed and asked whether penalties and interest on that amount, as well as the separate payments Dr. Shaffer was making in connection with the 1999-2001 tax years, would be taken into consideration in the final plea agreement (Ex. 4). ADA Gitin explained at trial that the policy of the Queens DA's office in prosecuting such cases is to seek restitution only for the actual loss incurred (i.e., the PIT owed). Penalties and interest were not part of the plea agreement because, in his view, such amounts were assessed by DTF, were the equivalent of pain and suffering in a civil case, and it was inappropriate to pursue them as part of the criminal matter (May Tr., p. 394). Thus, he said that the $13,440 amount set forth in the plea agreement is the "actual out of pocket loss" to DTF as the victim (May Tr., p. 390, quoting Penal Law § 60.27[1]). He noted that Penal Law § 60.27(6) expressly provides that such plea agreements do not preclude or impair DTF from seeking any damages in excess of actual out-of-pocket losses by bringing a civil action or proceeding (May Tr., p. 395). In Ms. Perlson's experience, some district attorneys' offices do seek penalties and interest in the plea agreement (Suffolk County), while others do not (Nassau County), and observed that, in this instance at least, the Queens County DA did not include them either (May Tr., pp. 357-358).
On June 15, 2010, Queens Criminal Court signed the order (Ex. 3 [hereinafter, the "Restitution Order"]; see Ex. B [Transcript of proceeding]; Ex. K [Certificate of Disposition]), wherein the terms of the allocution and plea agreement were memorialized providing that Claimant was required to pay restitution of $13,440, as more fully described above. ADA Gitin testified that he prepared the Restitution Order. The Restitution Order further directed that all payments be made by April 2, 2012, a date that was prior to the maximum expiration of Claimant's probation sentence. Such amounts were payable to DTF, as beneficiary. At the top of the Restitution Order, it is noted that it must be attached to the NYC Probation Department's copy of the Orders of Probation. The body of the order further states that "[r]estitution is included as a special condition of Probation" and that, pursuant to Penal Law § 60.27(8), the 5% surcharge is payable to the NYC Probation Department and may not be waived (Ex. 3). ADA Gitin testified that the Restitution Order was not an agreement between Claimant and the State, but, rather, the order of Queens Criminal Court to Dr. Shaffer, as defendant in the criminal proceeding, to pay restitution to DTF, as the named beneficiary (May Tr., p. 388).
DTF sent Claimant a Notice of Deficiency, dated August 2, 2010, notifying him that a field audit disclosed that he owed $11,439.86 in additional interest and penalties only (i.e., no taxes) (Ex. 33, pp. 17-19). The letter further explained Claimant's rights if he disagreed with the amount owed, and warned that, if he failed to act by September 11, 2010, then the notice would become an assessment subject to collection action. It further advised Claimant that interest and penalties would continue to be added to the total amount due unless and until full payment was received by the payment date, in this case August 23, 2010. Claimant testified that he never received the letter (May Tr., pp. 266, 268). DTF has no record of Claimant or his counsel filing a timely protest (see Ex. 9).
Geraldine Smith, a DTF tax compliance representative who worked under Ms. Wallace, contacted Claimant on October 26, 2012, first to congratulate him for completing payments pursuant to the Restitution Order and, second, to inform him that DTF would be seeking additional payments from him (May Tr., pp. 145-146, 234). The Claim asserts that the action accrued two days later, on October 28, 2012, although, at trial, Dr. Shaffer could not recall why that date was chosen (May Tr., p. 174). Claimant testified that he did not hear anything further from DTF about additional amounts allegedly owed until after he won a lottery prize in February 2013 (May Tr., p. 149-150). He agreed, however, that he signed his Claim on November 16, 2012, it was served upon Defendant on December 13, 2012, and it was filed "well before I won Lotto" so that, at that point, the only money DTF had recovered from him were the payments under the Restitution Order (May Tr., pp. 175, 178; see Ex. 27).
The Claim was filed with the office of the Clerk of the Court on December 5, 2012.
Ms. Wallace explained that, when DTF determines a fixed and final liability, called an assessment, it files a warrant for such assessment with the New York State Department of State and in the applicable County Clerk's office in order to create a lien against the debtor's real property (May Tr., pp. 416-417, 419). She said that a warrant is like a judgment and is a public record (May Tr., pp. 418-420). She further explained that DTF has an agreement with the New York State Division of the Lottery (hereinafter, "the Lottery"), pursuant to which the names of lottery winners are checked against a DTF-generated list of taxpayers who have outstanding liabilities (see Ex. C [Tax Law § 1613-c, and Memorandum of Understanding between the Lottery and DTF (hereinafter, the "MOU")]). The liabilities are offset against any lottery winnings and are paid to DTF (May Tr., p. 421).
On February 28, 2013, the Lottery paid to DTF, pursuant to a Tax Compliance Levy, more than $16,000 from Claimant's winnings in order to satisfy warrants filed in 2002-2004 (Ex. 32, pp. 6-9). Ms. Wallace explained that DTF also addressed two notices to Claimant in the first half of March 2013 advising him that DTF had offset against his lottery prize to pay nearly $25,000 in other assessments dating from 2000, 2001, 2007, and 2011 (Ex. 32, pp. 2-3). The Court notes that warrants were filed for each of those assessments except for one in the amount of $17.33 (cf. Ex. 32, pp.2-3 with p.4 [notation "WD" next to each assessment]; May Tr., p. 417 [Ms. Wallace explained that "WD" means that a warrant was filed]). Ms. Wallace testified that the Lottery paid those amounts to DTF as well (May Tr., p. 422).
Claimant at first asserted that DTF never advised him that money would be seized from his winnings, and denied receiving any notices to that effect, but later said that he could not recall (May, Tr., pp. 149-150, 254-255, 265). He said that he first learned from Yolanda Vega, the lottery's television presenter, at the ceremony where his winnings were announced, that DTF had deducted an amount from his prize.
A February 23, 2013 story appeared in the New York Post, under the headline "Tax Cheat Wins $5M in Lottery" (Ex. 21). In it, Claimant was identified by name and the story recited that "State tax authorities slapped [Dr.] Shaffer with four class-E felony counts in January 2010 for failing to file tax returns from 2002 to 2007. He owed $13,419 in back taxes, said a news release from [DTF]. He ultimately pleaded guilty to a misdemeanor and agreed to pay restitution, a [DTF] spokesman said" (Ex. 21). Claimant testified that the story was false and that he was not a tax cheat (May Tr., p. 37). On cross-examination, however, Dr. Shaffer agreed that he was arrested for not filing tax returns, pleaded guilty, and agreed to pay restitution (May Tr., pp. 166-167, 171). He said it was not correct, however, to state that he did not file tax returns for 2002 through 2007 because he filed them in late 2008, and further asserted that he had an extension to do so from both the State and federal governments (id., pp. 168-169).
LAW and DISCUSSION
Upon consideration of all the evidence, including a review of the exhibits and listening to the witnesses testify and observing their demeanor as they did so, the Court finds that Claimant failed to establish his Claim by a preponderance of the credible evidence.
With the exception of Claimant, each of the witnesses who testified at trial provided generally sincere and forthright testimony. As for Dr. Shaffer's testimony, the Court found large swaths of it to be self-serving, implausible, contradicted by other portions of the record, and less than creditworthy.
The Claim asserts causes of action against the State alleging breach of the terms of the Restitution Order, breach of "a covenant of good faith and fair dealing" and "overreaching," defamation, and violation of Dr. Shaffer's civil rights (see Ex. 27).
The Restitution Order
This dispute chiefly concerns the scope and effect of the Restitution Order and the Court concludes that Defendant was not prohibited by the terms of the order from assessing and collecting penalties and interest against Dr. Shaffer.
Claimant argues that he never agreed or intended to pay anything more than what was required by the Restitution Order, and, because penalties and interest were not included in the terms of the order, DTF was precluded from imposing those additional amounts upon him. He further asserts that it is irrelevant that DTF communicated its demands to him, again because there is no written agreement and no signed consent by him acceding to those demands. In effect, Claimant argues that the Restitution Order created a species of accord and satisfaction whereby any existing debt by him to DTF was discharged and replaced by a new agreement for him to pay only the taxes owed, with DTF having waived or abandoned the right to collect penalties and interest.
Defendant, by contrast, asserts that the Restitution Order only sets forth the conditions upon which the criminal proceedings against Dr. Shaffer were resolved. In return for his plea to a reduced charge, Claimant was ordered to pay restitution in the amount of the taxes he owed the State. Restitution was a special condition of his probation. In the Defendant's view, the Restitution Order in no way limited DTF from attempting to collect civil penalties and interest against Dr. Shaffer.
The Court adopts Defendant's view and determines that the terms of the allocution and sentencing proceedings, and the Restitution Order, were fulfilled in their entirety. The four felony criminal charges against Claimant were dropped. Dr. Shaffer was permitted, instead, to plead guilty to one misdemeanor count of failing to file a tax return and was sentenced to three years probation. The Restitution Order expressly states that it must be "attached" to the NYC Probation Department's copy of the "Orders of Probation" and that restitution is included as a "special condition" of Claimant's probation (Ex. 3). It specifically notes that a mandatory surcharge is payable to NYC Probation pursuant to Penal Law § 60.27(8), which may not be waived. The Restitution Order names DTF as the beneficiary of the restitution payments, in other words, the victim of the offense. The order further requires that the total restitution must be paid by a date that is prior to the maximum expiration of Claimant's probation sentence. All of those provisions have been satisfied in full. Claimant obtained the benefit of his plea agreement.
Even assuming, arguendo, Claimant's position that the Restitution Order was a form of contract between him and Defendant, a point which the State disputes (see People v Selikoff, 35 NY2d 227, 238 [1974], cert denied 419 US 1122 [1975]; Hodes v State of New York, 113 AD2d 121, 122 [3d Dept 1985], lv denied 68 NY2d 602 [1986]), the Court concludes Claimant's argument fails. It is well settled that the role of the courts in interpreting the language of a contract "is to ascertain the intention of the parties at the time they entered into the contract" (Evans v Famous Music Corp., 1 NY3d 452, 458 [2004]). Where that intent is complete, clear, and unambiguous, as evidenced by the plain meaning of the language the parties chose to employ in the contract, it should be enforced as written. There is no need to look further (Evans v Famous Music Corp., supra; Greenfield v Philles Records, 98 NY2d 562, 569 [2002]).
The Restitution Order clearly was issued by Queens Criminal Court as part of the resolution of Claimant's criminal proceeding. The plain language is that restitution was ordered as a special part of Dr. Shaffer's probation. The Restitution Order does not mention, specifically, penalties and interest, a point upon which the parties have agreed throughout the course of this litigation. Likewise, there is no statement to the effect that the Restitution Order constitutes the entirety of the agreement between Dr. Shaffer and the State, including any civil liabilities, or that they have been restructured and reduced to only the amount of taxes owed. Thus, the Court finds that the question of penalties and interest simply are beyond the scope of the Restitution Order and that Claimant is, therefore, incorrect in asserting that DTF's efforts to collect them breached the terms of the order.
Moreover, even if the Court looks beyond the plain meaning of the Restitution Order to consider other evidence of the parties' intent, Claimant's arguments are unavailing.
First, Dr. Shaffer agreed at his allocution that he was not coerced into pleading guilty and that no promises were made to him, other than the promise of probation. Thus, he himself conceded in open court that no other consideration was offered to him that was not contained in the Restitution Order. Yet, at trial he said that he relied upon ADA Gitin's letter of January 2009, and, but for it, he would not have pleaded guilty. To the Court's mind, the two assertions cannot be reconciled. Either he spoke falsely when he told Queens Criminal Court that no inducements were made in exchange for his plea, or his trial testimony in this Claim was false when he said he depended upon ADA Gitin's letter.
Moreover and in any event, the Court finds that no assurances were given by ADA Gitin upon which Dr. Shaffer reasonably could/should have relied concerning any action the Education Department might take. To the contrary, the ADA took pains to state unequivocally that the Queens DA's office would not assure Claimant that his professional license would be unaffected by the criminal proceeding. ADA Gitin did state that, in his experience, the State took no such action if a matter did not involve the actual practice of the licensed profession, but he clearly was making no promise or prediction that such an outcome would occur in this instance (see Ex. 5). Certainly, ADA Gitin did not indicate that he could dictate or bind the Education Department's regulatory decisions about Claimant's professional license, and Dr. Shaffer does not suggest why he reasonably might have believed that to be the case.
Second, as noted above, the parties agreed that the Restitution Order does not mention, specifically, penalties and interest. Moreover, each knew that the other attached a different significance to the scope and effect of the Restitution Order well before the order was executed.
Claimant argues that because DTF staff were at the allocution, but did not speak, or object to the proposed terms, DTF was precluded from collecting penalties and interest against him. The argument is without merit, however, because DTF and the Queens DA are "separate and independent entities" for purposes of the criminal matter, and any role DTF had in assisting the Queens DA in that proceeding was in its capacity as a crime victim, and not as a prospective civil litigant (City of New York v College Point Sports Assn., Inc., 61 AD3d 33, 46 [2d Dept 2009]; see Matter of Juan C. v Cortines, 89 NY2d 659, 668-669, 671-672 [1997]; State of New York v Mountain Tobacco Co., 2016 WL 3962992 [EDNY 2016] ["A district attorney is not empowered to address the civil claims that a City or County may assert."]).
Claimant also has intimated that the conversation between ADA McCarron and Mr. Borofsky at his allocution, after which the amount of restitution was reduced, evidenced that Defendant waived the collection of penalties and interest. The Court disagrees. While the amount originally mentioned at the allocution, as noted above, is similar to the total amount of taxes, penalties, and interest DTF asserted that Dr. Shaffer owed, Claimant failed to establish to this Court's satisfaction, the contents of that off-the-record conversation, the basis for the amount originally stated by ADA McCarron, or the reason for its reduction. Claimant testified that the lawyers approached the bench to discuss the matter (Nov. Tr., p. 45). Thus, he was not a party to the conference with the judge and has only secondhand knowledge of what transpired. Even if the Court assumes that the original number did include penalties and interest, it might have been reduced because the ADA abandoned any claim to those amounts, as Claimant posits, or, it could be that the ADA decided to leave those amounts out of the Restitution Order in order for DTF to pursue them by civil action or proceeding. In fact, the latter scenario strikes the Court as being more likely, as it is in keeping both with the policy of the Queens DA's office articulated by ADA Gitin not to include penalties and interest in such orders, as well as the meeting between DTF and Dr. Shaffer that took place immediately after the allocution.
DTF made clear to Claimant no later than the same day as his allocution that it intended to press its claim for penalties and interest against him. Thereafter, DTF even provided Claimant with several draft Adjusted Consents in an attempt to secure his acquiescence. By the same token, Dr. Shaffer failed to sign any of those draft Adjusted Consents, a signal to Defendant that Claimant would not agree to pay such amounts willingly. Thus, there was no mistake or misunderstanding here on the part of either party. Rather, by the time of the sentencing, each clearly understood that they disagreed about the collection of penalties and interest, and their course of dealings evidenced, to the Court's mind, an intent to lay the issue aside rather than confront and resolve it directly. In effect, each bet that their legal interpretation of the scope of the Restitution Order was the correct one, and each took a chance that their understanding ultimately would prevail.
The Court determines that Defendant's view is correct and that the Restitution Order did not preclude DTF from attempting to collect penalties and interest from Dr. Shaffer. The Restitution Order itself expressly references one provision of Penal Law § 60.27 governing restitution and reparation. That statute also provides that, after the district attorney has been given an opportunity to be heard, the court may require, as part of the sentence imposed, that the person convicted of an offense make restitution of the fruits of his or her offense to the victim of the crime, or reparation for the out-of-pocket loss caused to the victim (Penal law § 60.27[1]). The statute further states that payment of an amount of money as restitution does not preclude the victim from instituting "any civil action or proceeding" for damages in excess of the amount received as restitution (Penal Law § 60.27[6]; see Penal Law § 60.27, Hon. William C. Donnino, Practice Commentary: Assessing Restitution and Reparation; City of New York v College Point Sports Assn., Inc., supra at 46-47; Marion Blumenthal Trust v Arbor Commercial Mtge., LLC, 133 AD3d 419,420 [1st Dept 2015]; People v Wein, 294 AD2d 78, 85 [1st Dept 2002]). In fact, in Wein, the First Department held that the trial court could not condition the victims' right to receive restitution upon their execution of releases because the court could not force the victims to surrender "specifically protected civil remedies in order to receive an amount less than the entire restitution justly due" (People v Wein, supra). While no such releases were sought here, Wein underscores the fact that DTF, as the victim of Claimant's offense and the beneficiary of the Restitution Order, had an "independent, parallel right also to pursue a [criminal] defendant civilly should there be a deficiency in the restitution amount" (id.).
It also is instructive that, in City of New York v College Point Sports Assn., Inc., the City was permitted to seek additional restitution in a civil action, even though the defendants there maintained that they were unaware that the City had commenced such proceedings prior to the time their criminal sentences were imposed. Here, by contrast, Dr. Shaffer knew right after his allocution, and well before his sentencing, that DTF intended to pursue him for penalties and interest.
The Court rejects Claimant's argument that Penal Law § 60.27(6) does not apply because DTF did not institute a civil action for damages, but, rather, in his view, seized his assets without notice, based upon arbitrary and fraudulent calculations of penalties and interest.
The statute provides that a crime victim, in this case DTF, shall not be precluded or impaired from pursuing "any liability for damages in any civil action or proceeding" (Penal Law 60.27[6] [emphasis supplied]). The Court of Appeals has "repeatedly [held] that 'the word any' means 'all' or 'every' and imports no limitation" (Kimmel v State of New York, __ NY3d ___, NY Slip Op 03689 [2017] [emphasis in original]). Thus, the Court concludes that the actions taken by DTF in order to secure payment of the liabilities Dr. Shaffer owed to it are within the unfettered protection Penal Law § 60.27(6) affords.
As recited above, DTF sent Claimant a Notice of Deficiency in 2010, notifying him that he owed additional interest and penalties. It outlined his right to challenge that amount, and warned him that, if he failed to act by September 11, 2010, then the notice would become an assessment subject to collection action, with interest and penalties continuing to accrue until payment was received. The Court rejects Claimant's self-serving testimony that he never received the letter and finds that neither he, nor his counsel, protested the amounts in a timely manner, and the time to do so has long since passed (see Ex. 9). Ms. Smith informed him again in 2012 that DTF would be seeking additional payments from him. Ms. Wallace's credible and uncontradicted testimony was that, when DTF determines a fixed and final liability, or assessment, warrants are filed both with the New York State Department of State and in the applicable County Clerk's office, creating a lien and judgment that is a public record. She further explained that, pursuant to the MOU between DTF and the Lottery, tax liabilities are offset against any lottery winnings and are paid to DTF. The Court further credits Ms. Wallace's testimony that DTF notified Claimant again in 2013 that it had offset his lottery prize to pay assessments/warrants. The Court notes that warrants were filed for each of those assessments and that the Lottery paid those amounts to DTF.
The Court rejects Claimant's prevarications, first, that DTF never advised him, and then that he could not recall if it told him, that money would be seized from his winnings, and that he first learned about it from Yolanda Vega. Rather, the Court finds that Defendant credibly established that DTF notified Dr. Shaffer as to the amount of the liabilities he owed, and collected it pursuant to regular and established procedures.
In summary, the Court finds that Claimant's reasonable expectations were met, based upon an objective reading of the allocution and sentencing proceedings, and the Restitution Agreement (see People v Collier, 22 NY3d 429, 433-434 [2013]; People v Cataldo, 39 NY2d 578, 580 [1976]). Dr. Shaffer is not entitled to have his plea deal, including the restitution component thereof, tested against his subjective interpretation or expectation (id.). The fact remains that the parties were acutely aware that they disagreed at all relevant times about the status of the penalties and interest asserted by DTF.
Under such circumstances, the Court finds Claimant's arguments that the Restitution Order settled the question of penalties and interest to be both disingenuous and self-serving. Given the uncertainty about the scope of the Restitution Order, if Dr. Shaffer expected that order to serve as a global and comprehensive settlement of his outstanding liabilities to the State, then he should have insisted that it expressly address the issue of penalties and interest. By contrast, Defendant asserts that the Restitution Order should be read in accordance with its terms to only provide for restitution of Dr. Shaffer's outstanding taxes as a condition of his probation, with the issue of whether or not penalties and interest were owed left open and unresolved. Thus, it was not impelled by the same need to settle that question. In the end, Claimant simply has it backwards in maintaining that DTF somehow was obliged to establish that a subject not mentioned in the Restitution Order was not governed by it.
Covenant of Good Faith and Fair Dealing/ Overreaching/Unjust Enrichment
The Court finds Claimant's assertions that Defendant breached "a covenant of good faith and fair dealing" and was guilty of "overreaching" and "unjust enrichment" to be without merit. To the contrary, the record shows that DTF forthrightly and repeatedly advised Claimant that it intended to press its claim for penalties and interest against him so that Dr. Shaffer could have been under no misapprehension otherwise.
Claimant's suggestion that ADA Gitin somehow induced him to take the plea deal by his January letter is not worthy of credit for the reasons stated above. The tenor of ADA Gitin's letter was clear. No promises were made.
In post-trial submissions, Dr. Shaffer asserts that DTF breached a covenant of good faith and fair dealing by failing to "honor" his two OICs without a showing that DTF had any such duty to "honor" them. Rather, the uncontradicted testimony of Ms. Perlson was that no OIC could be accepted while an audit was ongoing and before the taxpayer's liability was established. Because the matter of penalties and interest had not been agreed to or resolved at the time the OICs were submitted, liability still was unsettled. She further noted that the 2010 OIC did not recite an amount that Claimant was offering in order to compromise his obligation. As for the 2009 OIC, the document was not produced at trial. Mr. Guadalupe had no clear recollection of it and, although Ms. Perlson said that she heard that an OIC had been filed and rejected, it is not clear to the Court from the context of her testimony which OIC she was referencing. It is passing strange that Claimant fastidiously maintained and produced copies of business cards with his notes on them when DTF staff visited him, yet failed to produce a copy of the 2009 OIC at trial. In any event, there was no showing that the 2009 OIC was complete, nor, again, did Claimant establish that DTF was obliged to "honor" it. Likewise, Claimant did not show that either of his two installment agreements were not "honored" by DTF. The Court rejects as self-serving and incredible, Claimant's assertions that he did not receive DTF's correspondence concerning the deficiencies in the 2010 OIC and that his accountant failed to forward the letter on which he was copied. What is believable, however, is his testimony that he failed to followup on the 2010 OIC.
Finally, Claimant failed to show any unjust enrichment, as he neither showed that the amounts intercepted from his lottery winnings lawfully belonged to him, nor did he show that it was against equity and good conscience to permit DTF to assess and collect penalties and interest in connection with PIT returns that went unfiled and unpaid for a number of years (see McGrath v Hilding, 41 NY2d 625, 629 [1977]; Clifford R. Gray, Inc. v LeChase Constr. Servs., LLC, 31 AD3d 983, 987-988 [3d Dept 2006]; Cruz v McAneney, 31 AD3d 54, 59 [2d Dept 2006]).
Civil Rights Violations
With respect to Dr. Shaffer's allegations that Defendant has violated his civil rights, to the extent that they assert deprivations under the Federal Constitution, no action may be maintained in this Court against the State for alleged Federal constitutional violations (Shelton v New York State Liq. Auth., 61 AD3d 1145, 1151 [3d Dept 2009]; Lyles v State of New York, 194 Misc 2d 32, 35-36 [Ct Cl 2002], affd 2 AD3d 694, 696 [2d Dept 2003], affd on other grounds 3 NY3d 396 [2004]; Matter of Thomas v New York Temporary State Commn. on Regulation of Lobbying, 83 AD2d 723 [3d Dept 1981], affd 56 NY2d 656 [1982]). To the extent that Claimant asserts Federal constitutional violations, his remedy lies elsewhere.
In Brown v State of New York (89 NY2d 172 [1996]), the Court of Appeals "recognized that, when certain requirements are met, a violation of the [New York State] Constitution may give rise to a private cause of action" (Waxter v State of New York, 33 AD3d 1180, 1181 [3d Dept 2006]; see Wagoner v State of New York, UID No. 2008-029-014 [Ct Cl, Mignano, J., Apr. 2, 2008]). In Martinez v City of Schenectady (97 NY2d 78 [2001]), however, the Court of Appeals made it clear that Brown establishes a "narrow remedy," applicable in cases where no other remedy is feasible to provide citizens with "an avenue of redress" when their private interests have been harmed by constitutional violations (Martinez v City of Schenectady, supra at 83; Waxter v State of New York, supra at 1181). Where an adequate remedy could be provided, however, " 'a constitutional tort claim … is [not] necessary to effectuate the purposes of the State constitutional protections … [invoked] nor appropriate to ensure full realization of [claimants'] rights' " (Bullard v State of New York, 307 AD2d 676, 679 [3d Dept 2003], quoting Martinez v City of Schenectady, supra at 83).
In the present case, recognition of the State constitutional cause of action is neither necessary nor appropriate to ensure the full realization of Claimant's rights, because the alleged wrongs could have been redressed by an alternative remedy, namely, the other causes of action in his Claim. For that reason, it is not necessary to recognize a State constitutional remedy here and, thus, the cause of action alleging violations of Claimant's State constitutional rights is dismissed.
Defamation
The Court determines that Claimant failed to establish his defamation claim. The Claim states that Defendant made "false and defamatory statements about the Claimant concerning the amount of tax, penalties, and interest the Claimant owed. These statements were contrary to the Restitution Order made by [Queens County Criminal Court], which was paid in full by the Claimant" (Ex. 27, ¶ 2[a]). It is well settled, however, that, "[i]n an action for libel or slander, the particular words complained of shall be set forth in the [Claim] …" (CPLR 3016[a]). Defendant asserted in its Verified Answer, filed with the office of the Clerk of the Court on January 24, 2013, as its Third Affirmative Defense, that Claimant failed to comply with CPLR 3016(a). The Court agrees.
The Claim fails to state with sufficient particularity the alleged defamatory statements made by Defendant (Place v Ciccotelli, 121 AD3d 1378, 1380 [3d Dept 2014]; Dobies v Brefka, 273 AD2d 776, 777-778 [3d Dept 2000], lv dismissed 95 NY2d 931 [2000]. Rather, the Court determines that the Claim provides only vague characterizations, or paraphrases, rather than a recitation of the particular words uttered by Defendant (Conley v Gravitt, 133 AD2d 966, 968 [3d Dept 1987]; cf. Radiation Oncology Servs. of Cent. N.Y., P.C. v Our Lady of Lourdes Mem. Hosp., Inc., 148 AD3d 1418, 1420 [3d Dept 2017]).
Moreover, "[i]t is axiomatic that truth is an absolute, unqualified defense to a civil defamation action … and that substantial truth is all that is required" (Schwartzberg v Mongiardo, 113 AD2d 172, 174 [3d Dept 1985]; Strader v Ashley, 61 AD3d 1244, 1246 [3d Dept 2009], lv dismissed 13 NY3d 756 [2009]; Ingber v Lagarenne, 299 AD2d 608, 609 [3d Dept 2002], lv denied 99 NY2d 507 [2003]). Defendant asserted as its Fourth Affirmative Defense in its Verified Answer that the "statements which form the basis of the [C]laim are true, and therefore, the [C]laim fails to state a cause of action for libel or slander."
As noted above, the Court finds that the allegedly defamatory statements Claimant paraphrases in his Claim were correct regarding the amount of tax, penalties, and interest he owed, and were not contrary to the terms of the Restitution Order. At trial, however, Dr. Shaffer asserted that it was the statement that he had not filed PIT returns which formed the basis for his defamation claim. Yet, Claimant did not include that statement in his Claim, no less recite any particular words. In any event, the Criminal Complaint does correctly note that he filed delinquent PIT returns years after he was obliged to, and without permission to do so. That statement was omitted from DTF's press release, as Ms. Perlson forthrightly agreed. That nugatory trifle, however, will not sustain his defamation action. The allegations concerning Dr. Shaffer's failure to file his PIT returns when and as required, a point Claimant does not seriously contest, were entirely correct in the Criminal Complaint and, the Court finds, were substantially correct in the press release. Given the nature of the allegations against him, it is hard to see how the failure to note that Claimant belatedly filed delinquent PIT returns (and without remitting any payments in connection with those obligations) caused any significant damage to his standing or reputation that the uncontroverted, self-inflicted, facts had not already wrought. Indeed, Claimant conceded the substantial accuracy of the press release when he pleaded guilty to the reduced charge of failing to file a PIT return. As for the New York Post story, no action lies against Defendant for a story written by a third party who references "State tax authorities," but does not quote them. Suffice to say, Claimant failed to "allege the time when, place where, and manner in which" a DTF employee made the allegedly false statements contained in the newspaper story (Epifani v Johnson, 65 AD3d 224, 233 [2d Dept 2009]). In any event, the Court determines that story also was substantially correct.
"At the outset, the gravamen of an action in defamation is an injury to reputation" (PJI 3:23 at 229 [2017]).
CLAIMANT'S MOTION
Claimant made a Motion (Motion No. M-88230) to amend his Claim pursuant to CPLR § 3025(b) or, in the alternative, to file a Claim late pursuant to Court of Claims Act § 10 (6). The Motion was filed in the office of the Clerk of the Court on March 7, 2016. The proposed amended Claim would add two new causes of action. The first asserts abuse of power by the State, alleging that a false Criminal Complaint was filed insofar as it stated that Claimant failed to file tax returns when they were filed and accepted by Defendant without material changes. The second asserts violations of Claimant's taxpayer rights because Defendant failed to "honor" Claimant's OIC without a valid reason, and failed to "honor" the terms of his installment agreement (see Exhibit B attached to Affirmation in Support of Motion by Steven J. Borofsky, Esq. [hereinafter, the "Borofsky Affirmation"]). The new causes of action are based upon "significant facts and factual developments that have occurred since the original [C]laim was filed, and uncovered in discovery and deposition testimony" (Borofsky Affirmation, ¶ 2).
Both prongs of the Motion are denied. The Court notes that Claimant's Note of Issue and Certificate of Readiness was filed in the office of the Clerk of the Court on July 28, 2014. The Court advised the parties, by letter dated November 24, 2014, that the trial of this Claim would commence on November 17, 2015. The trial did begin that day, but had to be adjourned after only a few hours of testimony. By Daily Report, dated December 22, 2015, the Court advised the parties that the continuation of the trial would commence on May 17, 2016. Thereafter, on March 7, 2016, Claimant's Notice of Motion was filed in the office of the Clerk of the Court. Upon the continuation of the trial, the Court indicated that the Motion would be addressed as part of its decision on the trial itself (May Tr., pp. 14-15).
With respect to the portion of the Motion that seeks to amend the Claim, where, as here, "an action has been certified as ready for trial, judicial discretion in permitting the amendment should be exercised only in the most 'discreet, circumspect, prudent and cautious' of circumstances" (Bell v State of New York, UID No. 2015-032-117 [Ct Cl, Hard, J., Mar. 31, 2015], quoting Yavorski v Dewell, 288 AD2d 545, 546 [3d Dept 2001], quoting Thompson v Connor, 178 AD2d 752, 753 [3d Dept 1991], lv dismissed 80 NY2d 826 [1992]; see Fregoe v Fregoe, 33 AD3d 1182, 1183-1184 [3d Dept 2006]).
The Court finds the proffered explanation for the inordinate and unreasonable delay in making this Motion - that the new causes of action result from information gleaned during discovery - to be wholly inadequate. The Motion was not made until more than 19 months after the Note of Issue was filed in which Claimant indicated that discovery was completed. Nor can it even be said that the Motion was made on the eve of trial. Rather, Claimant waited until more than three months after the trial commenced to move. The Motion was filed more than 60 days after the continued trial date had been set. Thus, Claimant knew the facts that underlay these new causes of action for more than 19 months. He, likewise, had very nearly a full year's notice of the trial date. Yet, no reason was offered as to why these new theories could not have been advanced in a more timely manner. The Court agrees with Defendant that the State would be prejudiced if the proposed amendment was permitted at such a late date and after the trial had commenced. Under such circumstances, the Court concludes that this is not one of those discreet, circumspect, prudent, and cautious circumstances that would justify the Court's exercise of its judicial discretion in permitting the proposed amendments.
Moreover, assuming, arguendo, that the Motion had been granted, the Court further determines that the causes of action are without merit. The Court fails to see how it constituted an an abuse of power for Defendant to pursue Claimant for failing to file and pay his taxes for a number of years. Dr. Shaffer agreed that he did not file his PIT returns for 2002-2008 until late 2008 (November Tr., pp. 38-39). He pleaded guilty to one misdemeanor count of failure to file a tax return (Ex. A [Transcript of Proceeding]; Ex. K [Certificate of Disposition]). He agreed to pay restitution in an amount nearly equal to the PIT he owed for 2002-2007 (see Ex.1; Ex. 3). Thus, to that extent, he already has conceded the validity of the charge that he did not file a PIT return. The Criminal Complaint is factually correct. It notes that Dr. Shaffer belatedly filed his PIT returns in late 2008, but also notes that he had no permission to file them late, and that no tax payments were remitted to the State when the returns were filed. The Court concludes that no abuse of power occurred, or has been shown. As for alleged violations of taxpayer rights, the uncontradicted testimony of Ms. Perlson was that no OIC could be accepted while an audit was ongoing and before the taxpayer's liability was established and that the 2010 OIC failed to include a compromise offer. As noted, the 2009 OIC was not produced at trial. It was not shown to be complete, or that DTF was obliged to "honor" it. Likewise, Claimant did not show that either of his two installment agreements were not "honored" by DTF. Claimant also suggests, with nothing in the record to support it, that an extension he purportedly received from the Internal Revenue Service for his Federal PIT returns, somehow required that DTF do the same. Even if it is correct, as Dr. Shaffer asserts, that he could not file his State PIT returns until his Federal returns were completed, he did not show that he was absolved from the obligation to seek extensions from DTF.
Claimant's alternative prayer to be allowed to file a Claim late also is denied. Pursuant to Court of Claims Act § 10(6), it is within the Court's discretion to allow the filing of a late claim if the applicable statute of limitations set forth in Article 2 of the CPLR has not expired. Thus, the first issue for determination upon any late claim motion is whether the application is timely. The proposed amended Claim (Borofsky Affirmation, Ex. B) includes two new causes of action asserting abuse of power and violation of taxpayer rights. Those alleged acts could be regarded as a species of intentional tort (CPLR § 215 [3], a one-year Statute of Limitations), or negligence (CPLR § 214[5], a three-year statute of limitations). In either case, it appears that the proposed new causes of action are not timely as the amended Claim states that it accrued on October 28, 2012, more than three years before the Motion was filed on March 7, 2016.
However, even if the above requirement was met, the Motion still would be denied. In determining whether to grant a motion to file a late claim, Court of Claims Act § 10(6) sets forth six factors that should be considered, although other factors deemed relevant also may be taken into account (Plate v State of New York, 92 Misc 2d 1033, 1036 [Ct Cl 1978]). Claimant need not satisfy every statutory element (see Bay Terrace Coop. Section IV v New York State Employees' Retirement Sys. Policemen's & Firemen's Retirement Sys., 55 NY2d 979, 981 [1982]). However, the burden rests with Claimant to persuade the Court to grant his or her late claim motion (see Matter of Flannery v State of New York, 91 Misc 2d 797 [Ct Cl 1977]; Matter of Santana v New York State Thruway Auth., 92 Misc 2d 1 [Ct Cl 1977]).
Here, Claimant has failed to make the requisite showing. He has not addressed the six factors that should be considered, including perhaps the most important factor, whether the proposed amended Claim has the appearance of merit, for it would be futile to permit a defective claim to be filed, subject to dismissal, even if other factors tended to favor the request (Ortiz v State of New York, 78 AD3d 1314, 1314 [3d Dept 2010], lv granted 16 NY3d 703 [2011], affd sub nom. Donald v State of New York, 17 NY3d 389 [2011], quoting Savino v State of New York, 199 AD2d 254, 255 [2d Dept 1993]). As discussed above, the Court finds that the proposed new causes of action are without merit. Thus, Motion No. M-88230 is denied.
Finally, the Court would be remiss if it did not note the improper and unorthodox practice of Claimant's counsel, Mr. Borofsky, who, in his post-trial submissions, repeatedly cited documents that are not in evidence, including EBTs and materials purportedly produced by Defendant during discovery. He also attempted to argue new causes of action for the first time, such as an alleged violation of the Federal Brady rule regarding the prosecution's duty to disclose evidence to the defense in a criminal matter. Suffice to say, the Court disregarded all such references and did not consider any materials that were not part of the record of this trial. CONCLUSION
Claimant's counsel also argued that Exhibit 44 marked for identification (the EBT of Ms. Smith) should be admitted into evidence after the record had closed and even though he specifically withdrew his offer of that document at trial when Defendant's counsel stipulated that Ms. Smith did not remember speaking to Claimant (May Tr., p. 413).
Based on all the foregoing, the Court finds that Claimant failed to establish his case by a preponderance of the credible evidence, and the Claim is hereby dismissed.
All motions upon which the Court reserved decision at trial are hereby denied.
All objections upon which the Court reserved determination at trial are now overruled.
The Chief Clerk is directed to enter judgment accordingly.
June 26, 2017
Albany, New York
CHRISTOPHER J. McCARTHY
Judge of the Court of Claims