Bulson v. Control Data Corp.

• Decision Date: 15 November 1990
• Citation: 563 N.Y.S.2d 249,164 A.D.2d 141
• Parties: , 64 Ed. Law Rep. 1159 Patricia A. BULSON et al., Plaintiffs, v. CONTROL DATA CORPORATION, Defendant and Third-Party Plaintiff-Respondent, et al., Defendants; New York State Higher Education Services Corporation, Third-Party Defendant-Appellant.
• Court: New York Supreme Court — Appellate Division

Page 249

563 N.Y.S.2d 249

164 A.D.2d 141, 64 Ed. Law Rep. 1159

Patricia A. BULSON et al., Plaintiffs, v. CONTROL DATA CORPORATION, Defendant and Third-Party

Plaintiff-Respondent, et al., Defendants;

New York State Higher Education Services Corporation,

Third-Party Defendant-Appellant.

Supreme Court, Appellate Division,

Third Department.

Nov. 15, 1990.

Robert Abrams, Atty. Gen. (Patrick Barnett-Mulligan and Peter J. Dooley, of counsel), Albany, for third-party defendant-appellant.

Wager, Taylor, Howd, Brearton & Kessler (Theresa A. Schneder and Michael W. Kessler, of counsel), Troy, for defendant and third-party plaintiff-respondent.

Before CASEY, J.P., and WEISS, LEVINE, MERCURE and HARVEY, JJ.

MERCURE, Justice.

Plaintiff Patricia A. Bulson, employed by third-party defendant, New York State Higher Education Services Corporation (hereinafter NYSHESC), and injured when the cubicle in which she worked collapsed, commenced this action in Supreme Court against, among others, defendant Control Data Corporation (hereinafter defendant), the firm which manufactured the data processing equipment in use in the cubicle. Defendant, in turn, commenced a third-party action against third-party defendant, New York State Higher Education Services Corporation (hereinafter NYSHESC). NYSHESC thereafter moved to dismiss the third-party complaint on the ground that it was subject to suit only in the Court of Claims. Supreme Court denied the motion. NYSHESC now appeals.

We reverse. In Bell v. New York Higher Educ. Assistance Corp., 138 Misc.2d 932, 526 N.Y.S.2d 316, affd. 144 A.D.2d 1047, 533 N.Y.S.2d 642, appeal dismissed 73 N.Y.2d 871, 537 N.Y.S.2d 493, 534 N.E.2d 332, lv. denied 74 N.Y.2d 601, 623, 541 N.Y.S.2d 984, 539 N.E.2d 1112, it was concluded that Supreme Court lacked jurisdiction over claims brought against NYSHESC's predecessor, the New York Higher Education Assistance Corporation. ¹ Emphasis was placed upon the Legislature's specific reference to the corporation's status "within" the State University (see, Education Law § 652[1] as an indication that it was to be considered an agency of the State (Bell v. New York Higher Educ. Assistance Corp., supra, 138 Misc.2d at 934, 526 N.Y.S.2d 316; cf., State of New York Higher Educ. Servs. Corp. v. Baker, 126 Misc.2d 244, 482 N.Y.S.2d 212). Furthermore, the fact that the Legislature empowered the corporation to coordinate the State's administrative effort in student financial aid and loan programs "with those of other levels of government" (Education Law § 652[2][b] was seen as an indication that the corporation itself occupies a level of government (Bell v. New York Higher Educ. Assistance Corp., supra ). It is also significant, in our view, that NYSHESC's student aid and loan budget and its administrative and operating budget are subject to the control of the Legislature (see, Education Law § 653[2][a], [b] and the State is required to apportion and pay to it the amounts necessary to pay all defaulted student loans (see, Education Law § 653[2][c]. Moreover, any award made as a result of this or any other claim would come out of the State's treasury (see, Bell v. New York Higher Educ. Assistance Corp., supra ).

Contrary to defendant's assertion, those cases dealing with public authorities (see, e.g., Matter of Dormitory Auth. of State of N.Y. [Span Elec. Corp.], 18 N.Y.2d 114, 271 N.Y.S.2d 983, 218 N.E.2d 693; Story House Corp. v. State of New York Job Development Auth., 37 A.D.2d 345, 325 N.Y.S.2d 659, affd. 31 N.Y.2d 942, 340 N.Y.S.2d 929, 293 N.E.2d 97) do not compel a different result. First, the entities that defendant refers to were established by the Public Authorities Law as public benefit corporations (see, Public Authorities Law § 1675 et seq.; § 1800 et seq.) and, unlike NYSHESC, were not made part of any existing State agency. Second, public benefit corporations have the authority to issue bonds, making their fiscal autonomy from the State apparent (see, Matter of Dormitory Auth. of State of N.Y. [Span Elec. Corp. ], supra, 18 N.Y.2d at 117-118, 271 N.Y.S.2d 983, 218 N.E.2d 693). Nor do we find the Legislature's grant to NYSHESC of the power to sue and be sued inconsistent with its status as a State agency (see, State Univ. of N.Y. v. Syracuse Univ., 285 App.Div. 59, 135 N.Y.S.2d 539; see also, Breen v. Mortgage Commn., 285 N.Y. 425, 431, 35 N.E.2d 25; cf., Gembala v. Audobon Assn., 97 A.D.2d...