Brink's Inc. v. City of New York
| Decision Date | 06 September 1983 |
| Docket Number | D,954,Nos. 953,s. 953 |
| Parties | 13 Fed. R. Evid. Serv. 1388 BRINK'S INC., Appellant, v. The CITY OF NEW YORK, Appellee. BRINK'S INC., Appellant-Cross-Appellee, v. John ADAMS, Anthony De Nardo, Trevor Fairweather, Richard Florio, James Gargiulo, Michael Solomon, William J. Donovan, Francis Gitto, William McInerney, Anthony San Marco, James Springett, John Barrera and Joseph Nardo, Appellees, and Jorge Olivari, Ramon Hernandez, and Jose Rodriguez, Appellees-Cross-Appellants. ockets 82-7782, 82-7788. |
| Court | U.S. Court of Appeals — Second Circuit |
Robert A. Meister, Milgram, Thomajan, Jacobs & Lee, P.C., New York City (Victoria A. Cundiff, Andrew L. Deutsch, New York City, of counsel), for appellant-cross-appellee.
Jeffrey E. Glen, Sp. Asst. Corp. Counsel, New York City (Frederick A.O. Schwarz, Jr., Corp. Counsel, Debra A. James, Patricia Kruger, New York City, Edward C. Tuozzo, Staten Island, N.Y., Asst. Corporation Counsels, of counsel), for appellee City of New York.
Phillip M. Kovitz, New York City, for appellees-cross-appellants Olivari, Hernandez, and Rodriguez.
Before OAKES, CARDAMONE and WINTER, Circuit Judges.
The City of New York contracted out the collection of its parking meter revenues to Brink's Inc., the well-known national armored car carrier. Under the March 1978 contract, armed, uniformed Brink's personnel were to collect coins from parking meters throughout the City, deposit them into canisters sealed and locked by the City, and return the canisters to the City's parking meter division (PMD) at 42 Franklin Street in Manhattan. On April 9, 1980, seven Brink's collectors were arrested, five of whom were charged with and convicted of stealing parking meter revenues. The City suspended and ultimately cancelled the Brink's contract. On December 5, 1980, Brink's sued the City for money owed under the contract and the City counterclaimed charging breach of contract and negligence based upon lack of due care in hiring, failure to supervise and failure to investigate the parking meter collectors. Brink's served a third-party complaint on the seven employees above mentioned as well as five other employees and their supervisor, William J. Donovan.
The case was tried before a jury in the United States District Court for the Southern District of New York, Edward Weinfeld, Judge. Brink's had preliminarily moved to prevent the City from questioning any Brink's employees about matters with respect to which they could assert their privilege against self-incrimination, but Judge Weinfeld denied the motion. Brink's, Inc. v. City of New York, 539 F.Supp. 1139 (S.D.N.Y.1982). The jury, in a special verdict, found that the City had sustained its claim against Brink's for breach of contract and for negligence in failing to supervise and to investigate, but found for Brink's on the charge of negligence based upon lack of due care in hiring. The jury awarded the City $1 million compensatory and $5 million punitive damages. On the third-party complaint of Brink's Inc. against the individual collectors, ten of them were found severally liable in the amount of $5,000 each.
In a post-verdict opinion, Brink's Inc. v. City of New York, 546 F.Supp. 403 (S.D.N.Y.1982), Judge Weinfeld denied the Brink's motions for a directed verdict on the compensatory and punitive damage claims, Fed.R.Civ.P. 50(a), for judgment notwithstanding the verdict as to both damage awards, Fed.R.Civ.P. 50(b), and for a new trial on the ground that the awards were grossly excessive, Fed.R.Civ.P. 59. He did, however, allow a remittitur, to which the City subsequently agreed, of the $5 million punitive damage award to $1.5 million. Id. at 416. He also denied a motion by Brink's to set aside the verdicts on its indemnity claims against the collectors on the ground that they were inadequate, inconsistent, the result of passion and prejudice, and in disregard of the court's instructions. Alternatively, Brink's asked that the judgments against the ten individual employees be entered jointly because the jury found that each collector had acted jointly. This motion was granted; the motions of the collectors for directed verdicts and judgment notwithstanding the verdict were denied. Brink's appeals, as do three of the collectors found liable to Brink's: Jorge Olivari, Ramon Hernandez, and Jose Rodriguez. We affirm.
The City of New York owns and operates approximately 70,000 parking meters, mostly The process of collection involved collectors working in teams, with one individual going to each parking meter on a city-prescribed schedule. 1 To collect a meter, the collector would insert a meter key, open the bottom portion of the meter head, and remove a sealed coin box. This coin box would then be placed upside down onto a gooseneck protruding upward from a large metal canister on wheels, resembling a dolly, that the collector rolled along from meter to meter. By twisting the coin box, an unlocking device called a "canister key," attached to the canister by City personnel and theoretically not reachable by the collector, would allow the coins from the coin box to drop into the canister without the collector's having access to the coins. After the coin box was emptied the collector would replace it and lock the meter. Upon completion of a specific route the canister would be placed in a collection van. At the end of a given team's work on a particular day, the van was driven back to the PMD and the canisters were turned over to City personnel.
on-street, but some in metered parking lots. Daily collections average nearly $50,000. After public bidding in March of 1978, Brink's was awarded the contract to collect coins from these meters and deliver them to the New York City Department of Finance Depository. Brink's was reimbursed at the rate of 33 cents per day for each meter it collected. Operations under the contract commenced in May of 1978.
As can be seen from the above, collectors were not to have contact with the coins in the meters. 2 City personnel were to check each collection canister daily to ensure that it was in good working order; upon receipt of a canister the Brink's people signed a receipt attesting that it was in good working order. Under the contract, at the end of the day any canister malfunction or broken or uncollectible meters were to be reported to the City. Brink's was to provide ten three-person collection crews daily, the crews to be rotated in the discretion of the City Department of Finance as a security measure. The City directed that the rotation should be accomplished by a lottery system to prevent the formation of permanent teams, but the City's evidence was that the rotation system was ignored. Daily assignments were frequently made by the collectors themselves and the management of Brink's was aware of this but did nothing to correct it. As the trial judge stated, the jury "could readily have found that the planned rotation system was honored more in the breach than in the observance." 546 F.Supp. at 409. The contract also provided that Brink's would provide supervisory personnel to oversee the proper performance of its obligations. Although the contract called for two supervisors and one field inspector, the full complement was never assigned.
In response to an anonymous tip, the City's Department of Investigation, in conjunction with the Inspector General's Office of the Department of Finance, began an investigation of parking meter collections. Surveillance of Brink's collectors revealed suspicious activity violative of both the City's and Brink's rules and procedures. The investigators then "salted" parking meters by treating coins with a fluorescent substance and inserting them into specific meters. "Salted" meters were checked after the coin boxes had been emptied by Brink's employees to make sure that all of the treated coins were collected; collections from the meters were then scanned to see if any treated coins were missing. The "salting" process indicated that a substantial percentage of coins collected by Brink's personnel were not being returned to the City. Surveillance at the 42 Franklin Street depository revealed that at the end of a day Brink's employees would often arrive in James Gargiulo, Trevor Fairweather, Richard Florio, Michael Solomon and John Adams were arrested and charged with grand larceny and criminal possession of stolen property when on April 9 they had in their possession over $4,500 in coins stolen that day from parking meter collections. Anthony DeNardo was arrested and charged with petit larceny and criminal possession of stolen property. A charge against Jorge Olivari was dismissed on motion by the district attorney, but the remaining six defendants were either convicted after trial (Florio, Solomon and Adams) or pleaded guilty before trial (Fairweather, Gargiulo, DeNardo). They were sentenced to varying jail terms and fines ranging from $1,000 to $5,000.
personal vehicles following their assigned collection vans, indicating some kind of "drop-off." Brink's employees were also seen entering a parking lot in Manhattan in Brink's vans, removing bags from the vans, placing them in private automobiles and then returning to the vans to continue to the City depository. The City presented video tapes of these transfers at trial; Brink's collectors were shown straining to lift heavy bags into their cars. Brink's employees were also followed to a private residence and again observed carrying heavy bags from their vehicles into the building and emerging empty handed
Brink's maintains that its motion for judgment n.o.v. on the punitive damages award should have been granted because, first, the City's claim was essentially one for breach of contract, a claim for which punitive damages are unavailable under New York law and, second, the evidence demonstrated only ordinary negligence and...
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