City of New York v. Uniformed Fire Officers Ass'n

• Decision Date: 07 December 1999
• Parties: In re Application of The CITY OF NEW YORK, et al., Petitioners-Respondents, For a Judgment, etc., v. The UNIFORMED FIRE OFFICERS ASSOCIATION, etc., et al., Respondents-Appellants. Municipal Labor Committee, Amicus Curiae.
• Court: New York Supreme Court — Appellate Division

Page 355

699 N.Y.S.2d 355

In re Application of The CITY OF NEW YORK, et al., Petitioners-Respondents For a Judgment, etc., v. The UNIFORMED FIRE OFFICERS ASSOCIATION, etc., et al., Respondents-Appellants Municipal Labor Committee, Amicus Curiae.

Supreme Court, Appellate Division, First Department, New York.

Dec. 7, 1999.

Cheryl Payer, of counsel (Ellen B. Fishman, Felicia A. Mennin and Chlarens Orsland, on the brief, Michael D. Hess, Corporation Counsel of the City of New York, attorney) for petitioners-respondents.

Richard M. Betheil, of counsel (Tina C. Kremenezky, on the brief, Pryor Cashman Sherman & Flynn LLP, attorneys) for respondents-appellants Uniformed Fire Officers Association and John McDonnell.

Victoria A. Donoghue, of counsel (Wendy E. Patitucci, on the brief, and as General Counsel, Office of Collective Bargaining, attorney) for respondents-appellants Steven C. DeCosta and The New York City Board of Collective Bargaining, respondents-appellants.

Claude I. Hersh, of counsel (James R. Sandner, attorney) on behalf of Municipal Labor Committee, as Amicus Curiae.

JOSEPH P. SULLIVAN, J.P., EUGENE NARDELLI, MILTON L. WILLIAMS and ISRAEL RUBIN, JJ.

RUBIN, J.

This proceeding arose out of criminal investigations conducted by the New York City Department of Investigation (DOI) that either implicated the conduct of New York City Fire Department personnel or required their testimony as witnesses to possible criminal activity. One such investigation concerned an attempt to obtain higher pension benefits by claiming that a disabling injury was sustained while on duty. The scheme allegedly involved one firefighter calling in a false alarm to afford the injured firefighter the opportunity to claim that the injury was sustained in responding to the alarm. The investigation included interviews with members of respondent union, Uniformed Fire Officers Association, Local 854, who appeared pursuant to subpoena.

The union brought a grievance and demanded arbitration, contending that interviews with its members were conducted in violation of the employee rights provisions of its collective bargaining agreement with the City, Article XVII of which provides, in relevant part:

Section 2.

At the time an employee is notified to appear for interrogation, interview, trial or hearing the Employer shall advise the employee either in writing, when practicable, or orally to be later confirmed in writing of (1) the specific subject matter of such interrogation * * * and (2) whether that employee is a suspect or non-suspect. If notified orally, the employee shall be given a written notice before the interrogation * * * If an interrogation or interview may lead to disciplinary action, the employee may be accompanied by counsel and/or a union representative at such interrogation or interview.

* * *

Section 5.

When an employee is a suspect in a departmental investigation or trial, the officer in charge of the investigation or trial shall give the employee the following warning before that employee is questioned:

"I wish to advise you that you have all the rights and privileges guaranteed by the law of the State of New York and the Constitutions of this State and of the United States, including the right not to be compelled to incriminate yourself. You have the right to have an attorney present if you wish. I wish further to advise you that if you refuse to answer any questions relating to the performance of your duties, you will be subject to dismissal from your employment with the City. However, if you do answer questions, neither your answers nor any information or evidence which is gained by reason of such answers can be used against you in any criminal proceeding. You are advised, however, that if you knowingly make any false answers or deceptive statements, you may be subject to criminal prosecution and disciplinary action by reason thereof."

Such employee shall also be advised of the right to union representation. When the interrogating officer is advised by the employee that that employee desires the aid of counsel and/or a union representative, the interrogation shall be suspended and the employee shall be granted a reasonable time to obtain counsel and/or a union representative, which time shall be at least two working days.

If it appears that the investigation may result in a disciplinary proceeding based on the Employee's answer to questions or on the refusal to answer, a stenographic or electronic record of the questioning of the employee shall be made unless the exigencies of the situation prevent such recording.

In the event that an employee is subject to charges by the Department, any such record shall be made available to the employee or the representative.

The agreement also states that an "employee shall not be questioned by the Employer on personal behavior while off duty and out of uniform", except in matters pertaining to official department business, extra-departmental employment or volunteer firefighting, conflict of interest, injuries or illness, residency, and loss or improper use of departmental property.

The Union claimed in its arbitration demand that the DOI, as an agency of the "employer", the City of New York, was bound by the terms of the collective bargaining agreement. The union complains that its members interviewed by DOI investigators were not given prior written notice, were not read the statement of rights contained in section 5, were not permitted union representation (though counsel was permitted), and were not given immunity from the use of any information obtained in subsequent criminal proceedings. The City contested the arbitrability of the dispute before respondent Board of Collective Bargaining. On October 28, 1997, the Board issued a determination (Decision No. 46-97), finding the dispute to be arbitrable.

The City then brought this special proceeding pursuant to CPLR articles 75 and 78 in Supreme Court, seeking to annul the Board's determination and to permanently enjoin arbitration of the dispute. The petition contends that the City of New York never agreed to arbitrate the procedures employed by the DOI in conducting criminal investigations; that the collective bargaining agreement cannot, as a matter of public policy, supplant or impair those procedures; and that public policy considerations prohibit negotiation of the DOI's criminal investigation procedures.

Supreme Court set aside the administrative determination and enjoined arbitration, holding that "the core function of ensuring governmental integrity is a public policy sufficiently strong as to preclude referral of this dispute to arbitration". The court further found the policy implications to warrant immediate intervention to permanently stay arbitration (CPLR 7503[b] ) rather than deference to the arbitral forum and limitation of judicial review to the propriety of the forthcoming award (CPLR 7511; see, Avon Prods. v. Solow, 150 A.D.2d 236, 238-239, 541 N.Y.S.2d 406).

On appeal, respondents contend that Supreme Court acted precipitously in staying arbitration because an arbitration award might determine the dispute in a manner that accords with public policy. They argue that the determination by the Board of Collective Bargaining that the dispute is arbitrable is both reasonable and entitled to deference. Finally, they assert that the governing statutes do not bar arbitration of the dispute and that public policy considerations do not militate overwhelmingly against its resolution in an arbitral forum.

In Matter of Wertlieb (Greystone Partnerships Group), 165 A.D.2d 644, 646-647, 569 N.Y.S.2d 61, this Court stated the considerations bearing upon judicial interference in the arbitration process:

Normally, a party to a valid arbitration agreement is required to submit to arbitration and to defer any challenge to the proceeding until an award is rendered, either by way of an application to vacate the award (CPLR 7511; see, Matter of Weinrott [Carp], 32 N.Y.2d 190, 198 [344 N.Y.S.2d 848, 298 N.E.2d 42]) or in opposition to an application to confirm the award (CPLR 7510; Garrity v. Lyle Stuart, Inc., 40 N.Y.2d 354 [386 N.Y.S.2d 831, 353 N.E.2d 793]). It is rare for the courts to intervene in arbitration proceedings by amending the award (see, Garrity v. Lyle Stuart, Inc., supra, at 358-359 [386 N.Y.S.2d 831, 353 N.E.2d 793]) and rarer still to preclude parties from seeking resolution of a dispute in their chosen forum by imposing a stay (see, Matter of Silverman [Benmor Coats], 61 N.Y.2d 299, 309 [473 N.Y.S.2d 774, 461 N.E.2d 1261]). Therefore, a stay of arbitration is reserved for disputes which involve "a public policy of the first magnitude" (Matter of Aimcee Wholesale Corp. [Tomar Prods.], 21 N.Y.2d 621, 625 [289 N.Y.S.2d 968, 237 N.E.2d 223] [enforcement of State antitrust policy]; see also, Matter of Knickerbocker Agency [Holz], 4 N.Y.2d 245 [173 N.Y.S.2d 602, 149 N.E.2d 885] [claim concerning liquidation of insolvent insurer]; Durst v. Abrash, 22 A.D.2d 39 , affd. 17 N.Y.2d 445 [266 N.Y.S.2d 806, 213 N.E.2d 887] [enforcement of usurious loan agreement]; but cf., Rosenblum v. Steiner, 43 N.Y.2d 896 [403 N.Y.S.2d 716, 374 N.E.2d 610]). As stated more recently by the Court of Appeals, judicial intervention in the arbitration process is only appropriate where the relevant public policy considerations "prohibit, in an absolute sense, particular matters being decided or certain relief being granted by an arbitrator. Stated another way, the courts must be able to examine an arbitration agreement or an award on its face,...