Duffy v. Wetzler

• Court: New York Supreme Court — Appellate Division
• Writing for the Court: Before THOMPSON
• Citation: Duffy v. Wetzler, 616 N.Y.S.2d 48, 207 A.D.2d 375 (N.Y. App. Div. 1994)
• Decision Date: 08 August 1994
• Parties: Eugene H. DUFFY, et al., Respondents-Appellants, v. James W. WETZLER, et al., Appellants-Respondents.

Page 48

616 N.Y.S.2d 48

207 A.D.2d 375

Eugene H. DUFFY, et al., Respondents-Appellants, v. James W. WETZLER, et al., Appellants-Respondents.

Supreme Court, Appellate Division Second Department.

Aug. 8, 1994.

G. Oliver Koppell, Atty. Gen., Albany (Peter H. Schiff and Denise A. Hartman, of counsel), for New York State appellants-respondents.

Paul A. Crotty, Corp. Counsel, New York City (Edward F.X. Hart, Frances J. Henn, and Stanley Buchsbaum, of counsel), for New York City appellants-respondents.

Anderson Kill Olick & Oshinsky, P.C. (Mark L. Weyman, Robert Velez, and Mayda Prego, of counsel); Phelan & Costello, P.C., (John J. Phelan III, and Robert J. Costello, of counsel), New York City, and O'Neil, Cannon & Hollman, S.C., Milwaukee, WI (Eugene O. Duffy and Gregory W. Lyons, of counsel), for respondents-appellants (one brief filed).

Before THOMPSON, J.P., and MILLER, O'BRIEN and ALTMAN, JJ.

MEMORANDUM BY THE COURT.

In an action, inter alia, for declaratory and injunctive relief challenging the constitutionality of former Tax Law § 612(c)(3) and Administrative Code of the City of New York § 11-1712(c) (former [3]), the defendants appeal from so much of an order and judgment (one paper) of the Supreme Court, Queens County (LeVine, J.), dated June 14, 1990, as declared the challenged laws invalid and unconstitutional, and enjoined them from assessing or collecting personal income taxes which may still be due and owing, and from interfering with or refusing to grant the plaintiffs a refund of taxes paid on Federal pension benefits for the years 1986 through 1988, and the plaintiffs (1) cross-appeal from so much of the same order and judgment as, upon renewal, denied their motion for class certification, and dismissed the first cause of action asserted under 42 U.S.C. § 1983, and the fourth cause of action asserted against the defendant City of New York for money had and received (Duffy v. Wetzler, 148 Misc.2d 459, 555 N.Y.S.2d 543), and (2) appeal from four orders of the same court, all entered October 5, 1990, which denied their motions (i) for leave to renew or reargue their application for class certification and for resettlement of the judgment, (ii) to supplement their pleadings, (iii) to permit the intervention of various taxpayers, and (iv) for an award of attorneys' fees to the plaintiffs' counsel under the common fund doctrine. By opinion and order of this court dated January 15, 1992 (Duffy v. Wetzler, 174 A.D.2d 253, 579 N.Y.S.2d 684), the order and judgment appealed from was modified in certain respects by deleting, inter alia, those provisions which declared that the plaintiffs were entitled to refunds, and which granted injunctive relief accordingly, and the orders were affirmed. On a writ of certiorari to this court, the Supreme Court of the United States vacated the opinion and order of this court dated January 15, 1992, and remitted the matter here "for further considerition in light ofHarper v. Virginia Department of Taxation, 509 U.S. ----, 113 S.Ct. 2510, 125 L.Ed.2d 74 (1993)" (Duffy v. Wetzler, --- U.S. ----, ----, 113 S.Ct. 3027, 3028, 125 L.Ed.2d 716). Justice Altman has been substituted for former Justice Kunzeman (see, 22 NYCRR 670.1[c].

ORDERED that the appeal from the order and judgment of the Supreme Court, Queens County, dated June 14, 1990, is dismissed, without costs or disbursements, as academic; and it is further,

ORDERED that the order and judgment is affirmed insofar as cross-appealed from, without costs or disbursements; and it is further,

ORDERED that the orders are affirmed insofar as appealed from, without costs or disbursements.

In Duffy v. Wetzler, 174 A.D.2d 253, 579 N.Y.S.2d 684, supra (hereinafter Duffy I ), this court addressed the issue of whether the decision of the United States Supreme Court in Davis v. Michigan, 489 U.S. 803, 109 S.Ct. 1500, 103 L.Ed.2d 891 should be applied retroactively. In Davis, the Supreme Court of the United States invalidated, as violative of principles of intergovernmental tax immunity, Michigan's income taxation scheme which exempted from taxation pensions paid to former state employees but taxed the pensions paid to all other retirees, including those of the Federal government. The tax laws existing in this State and the City of New York at the time of the Davis decision were similarly discriminatory (see, Tax Law § 612[c][3]; Administrative Code of the City of New York § 11-1712), and were subsequently amended to exempt pensions paid to Federal retirees from taxation by the State and City (L.1989, ch. 664, §§ 1, 2, 3). The plaintiffs, Federal retirees, sought to secure refunds of the illegally imposed taxes for the period provided by statute ...