Giaimo & Vreeburg v. Smith

• Decision Date: 06 July 1993
• Citation: 192 A.D.2d 41,599 N.Y.S.2d 841
• Court: New York Supreme Court — Appellate Division
• Parties: , 62 Fair Empl.Prac.Cas. (BNA) 716 GIAIMO & VREEBURG, etc., et al., Appellants, v. James Todd SMITH, etc., Respondent.

Page 841

599 N.Y.S.2d 841

192 A.D.2d 41, 62 Fair Empl.Prac.Cas. (BNA) 716

GIAIMO & VREEBURG, etc., et al., Appellants, v. James Todd SMITH, etc., Respondent.

Supreme Court, Appellate Division Second Department.

July 6, 1993.

Giaimo & Vreeburg, Kew Gardens (Joseph Giaimo pro se, of counsel), appellant pro se and for the other appellants.

Goodkind, Labaton & Rudoff, New York City (Brian D. Caplan, of counsel), for respondent.

Before THOMPSON, J.P., and BRACKEN, MILLER, EIBER and RITTER, JJ.

THOMPSON, Justice Presiding.

The plaintiff attorneys commenced the instant action alleging that the defendant, their former client, improperly discharged them based solely upon their race. The defendant, who is known professionally as "LL Cool J", is black; the plaintiff attorneys, Giaimo & Vreeburg, are white.

The amended verified complaint contains several causes of action, but those relevant to the instant appeal are the fourth, fifth, and sixth causes of action. The factual allegations pertinent to the foregoing causes of action assert, inter alia, that after a number of years, during which the plaintiffs represented the defendant and forged a close relationship with him, the defendant dismissed the plaintiffs as his attorneys in August 1989 because of his alleged "desire to employ as attorneys, accountants, business managers and other professionals, only members of the [black race]". According to the plaintiffs' complaint, the defendant's discriminatory conduct violated, inter alia, the Federal Civil Rights Act (42 U.S.C. § 1981), Executive Law § 296(1)(a), and Civil Rights Law § 40-c(2).

The defendant subsequently moved to dismiss the fourth, fifth, and sixth causes of action pursuant to CPLR 3211(a)(7) on the ground that they failed to state a cause of action. The Supreme Court granted the motion, finding, inter alia, that 42 U.S.C. § 1981 covered only the making and enforcement of contracts, and that the allegations of wrongful termination made by the plaintiffs were outside its scope. The court dismissed the fifth cause of action, alleging a violation of Executive Law § 296, based upon its conclusion that Civil Rights Law § 40-c prohibited discriminatory discharges only within an employer-employee relationship, which did not apply to an attorney-client relationship. Lastly, the court ruled that the sixth cause of action alleging a violation of Civil Rights Law § 40-c was defectively pleaded, inasmuch as the complaint failed to allege that notice of the action was served upon the Attorney-General as required by Civil Rights Law § 40-d.

We agree with the Supreme Court's conclusion that the allegations set forth in the complaint fail to state a cognizable claim under 42 U.S.C. § 1981. The United States Supreme Court has clearly held that the protections of § 1981 extend only to the making and enforcement of contracts and that "[w]here an alleged act of discrimination does not involve the impairment of one of these specific rights, § 1981 provides no relief" (Patterson v. McLean Credit Union 91 U.S. 164, 176, 109 S.Ct. 2363, 2372, 105 L.Ed.2d 132). Further, the weight of authority is that under the Patterson rule, termination of a contract is not covered by § 1981 (see, Lavender v. V & B Transmissions & Auto Repair, 897 F.2d 805; Overby v. Chevron USA, Inc., 884 F.2d 470, 473; Long v. AT & T Information Systems, Inc., 733 F.Supp. 188; Doffoney v. Board of Trustees, 731 F.Supp. 781; Coleman v. Domino's Pizza, Inc., 728 F.Supp. 1528, 1531-1532, n. 3; Alexander v. New York Med. Col., 721 F.Supp. 587; Rivera v. AT & T Information Systems, Inc., 719 F.Supp. 962; Hall v. County of Cook, State of Ill., 719 F.Supp. 721; Rick Nolan's Auto Body Shop, Inc. v. Allstate Ins., Co., 718 F.Supp. 721). Accordingly, and since the allegations of improper discrimination made here concern "postformation" conduct relating to the termination of the parties' professional relationship, the plaintiffs' claims fall outside the reach of the statute. ^*

Moreover, we are unpersuaded by the plaintiffs' assertion that their complaint can be reasonably construed to allege covered "preformation" discrimination. The plaintiffs claim that each request for legal services made by the defendant constituted a separate and "new" contract, and that the defendant's refusal to enter into a "new" contract for legal services actually constitutes "preformation" conduct to which the protections of § 1981 would attach. While the plaintiffs' pleading must be construed liberally (see, Rovello v. Orofino Realty Co., 40 N.Y.2d 633, 389 N.Y.S.2d 314, 357 N.E.2d 970), as the dissenter properly observes, "and be deemed to allege whatever can reasonably be implied from its statements, it must still allege the material elements of the cause of action" (Kohler v. Ford Motor Credit Co., 93 A.D.2d 205, 207, 462 N.Y.S.2d 297; cf., Lewis v. Village of Deposit, 40 A.D.2d 730, 336 N.Y.S.2d 672, affd. 33 N.Y.2d 532, 347 N.Y.S.2d 434, 301 N.E.2d 422; Didier v. Macfadden Publications, Inc., 299 N.Y. 49, 53, 85 N.E.2d 612).

Although the plaintiffs now suggest that their representation of the defendant was comprised of separately-arising contracts corresponding to each request for legal services, the amended complaint characterizes the parties' relationship in precisely the opposite fashion, since it emphasizes, among other things, that "beginning in or about July 1985, and until the time " (emphasis added) they were dismissed, the plaintiffs were employed by the defendant to act as his attorneys, that the plaintiffs' firm was "continually" available to the defendant, 24 hours a day, and that it afforded him "unparalleled time and attention", accepting "calls during the middle of the night and in the early morning hours". If anything then, the reasonable inference to be drawn from the plaintiffs' own complaint is that the parties' relationship was ongoing and continuous rather than comprised of successively-arising contracts. In any event, even if the complaint is interpreted as alleging that successive contracts for legal services arose and that the discrimination occurred upon the defendant's refusal to renew the parties' contractual relationship, dismissal would still be warranted.

Significantly, in construing analogous cases, Federal courts have rejected attempts to circumvent the Patterson rule by the plaintiffs who have merely recast "postformation" claims as purported "preformation" discrimination, i.e., claims that an individual "is not only performing under an existing contract but also is constantly 'remaking' a new contract so that whenever the employee is discriminatorily terminated, the employer has impaired his or her right to 'make' a contract in violation of § 1981" (Brereton v. Communications Satellite Corp., 735 F.Supp. 1085, 1088). As the court in Brereton commented, "the great creativity of this argument is inversely proportional to the acceptance that it has garnered" (Brereton v. Communications Satellite Corp., supra, at 1088; see also, Smith v. Continental Ins. Corp., 747 F.Supp. 275, 281-282, affd. 941 F.2d 1203; Carter v. O'Hare Hotel Investors, 736 F.Supp. 158, 160; Coleman v. Domino's Pizza, 728 F.Supp. 1528, 1531-1532, supra ). It has been observed that if such a theory were accepted, discrimination plaintiffs could routinely "turn postformation conduct into preformation conduct simply by alleging that they sought a 'new' contract reinstating the terms of the prior agreement" ( Rick Nolan's Auto Body Shop, Inc. v. Allstate Ins. Co., 718 F.Supp. 721, 722, supra ).

Here, it is apparent that "although plaintiffs have attempted to present their § 1981 claim as charging discrimination in the making of a 'new' contract, plaintiffs' claim essentially is based on the discrimination which allegedly occurred in the termination of their prior agreement" (see, Rick Nolan's Auto Body Shop v. Allstate Ins. Co., supra, at 722). In short, irrespective of whether the plaintiffs' representation was comprised of just one contract or of successively-arising contracts, the fact remains that the wrongful discrimination which allegedly occurred was simply the termination of the parties' professional relationship in August 1989. Under these circumstances, the Supreme Court properly concluded that the complaint failed to state a cause of action under the Federal Civil Rights Act.

Additionally, we find that the fifth cause of action, alleging discriminatory conduct in violation of Executive Law § 296, was properly dismissed. Executive Law § 296(1)(a) prohibits, inter alia, discrimination in employment on racial grounds. However, the plain language of the statute limits its applicability to employees (see, Mehtani v. New York Life Ins. Co., 145 A.D.2d 90, 93, 537 N.Y.S.2d 800; cf., State Div. of Human Rights v. GTE Corp., 109 A.D.2d 1082, 1083, 487 N.Y.S.2d 234). Here, since the relationship between the plaintiffs and the defendant was clearly that of attorney and client, and not employer and employee, Executive Law § 296 is inapplicable.

Lastly, the Supreme Court properly dismissed the sixth cause of action asserted under Civil Rights Law § 40-c inasmuch as the plaintiffs failed to allege compliance with the statutory requirement of notice to the Attorney-General, as specifically mandated by Civil Rights Law § 40-d (see, Silver v. Equitable Life Assur. Socy. of the U.S., 168 A.D.2d 367, 368, 563 N.Y.S.2d 78).

ORDERED that the order is affirmed, with costs.

BRACKEN and EIBER, JJ., concur.

RITTER, Justice (concurring in part and dissenting in part).

I agree that the fifth cause of action, alleging a violation of New York's Human Rights Law, and the sixth cause of action, alleging a violation of New York's Civil Rights Law were properly dismissed for the reasons stated in the majority's opinion. However, I believe dismissal of the fourth cause of action was premature because the allegations of the complaint, coupled with the plaintiffs' affidavit...