In the Matter of John Murphy v. Kirkland

• Decision Date: 16 August 2011
• Citation: 928 N.Y.S.2d 333,88 A.D.3d 267,2011 N.Y. Slip Op. 06271
• Parties: In the Matter of John MURPHY, petitioner/cross-respondent,v.Galen D. KIRKLAND, etc., et al., respondents,State Division of Human Rights, respondent/cross-petitioner.
• Court: New York Supreme Court — Appellate Division

88 A.D.3d 267

928 N.Y.S.2d 333

2011 N.Y. Slip Op. 06271

In the Matter of John MURPHY, petitioner/cross-respondent,

v.Galen D. KIRKLAND, etc., et al., respondents,State Division of Human Rights, respondent/cross-petitioner.

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

Aug. 16, 2011.

Franklin, Gringer & Cohen, P.C., Garden City, N.Y. (Joshua Marcus of counsel), for petitioner/cross-respondent.Caroline J. Downey, Bronx, N.Y. (Michael K. Swirsky of counsel), for respondent/cross-petitioner.WILLIAM F. MASTRO, J.P., RUTH C. BALKIN, JOHN M. LEVENTHAL, and ROBERT J. MILLER, JJ.BALKIN, J.

The primary issue before us is whether, in this administrative proceeding brought under the Human Rights Law (Executive Law article 15), the New York State Division of Human Rights (hereinafter the Division) abused its discretion in amending the administrative complaint (hereinafter the complaint) by adding another respondent after the one-year limitations period set forth in Executive Law § 297(5) had expired, and after the respondent had already appeared pro se on behalf of his company, the sole respondent in the original complaint, at a public hearing on the complaint ( see Executive Law § 297[4][a] ). Specifically, the Division amended the complaint—which originally alleged sexual harassment and retaliatory termination by a sole respondent, Alliance Mortgage Banking Corp. (hereinafter Alliance)—by adding another respondent, John Murphy, Alliance's President and sole shareholder. This amendment was made after the one-year limitations period ( see Executive Law § 297[5] ) had expired and Murphy had already appeared pro se on behalf of Alliance at the public hearing on the complaint.

In August 2006 Takiya Fitzgerald filed the complaint with the Division, alleging that she had been sexually harassed by her supervisor, Keith Bailey, while they were employed by Alliance, and that she had been fired in retaliation for complaining about the harassment. Only Alliance was named as a respondent. Following an investigation, the Division determined that a public hearing was warranted. Shortly before the hearing commenced, Alliance discharged its counsel and proceeded pro se, through Murphy. According to Murphy, the corporation was going out of business and was in the process of winding down its affairs.

The matter came before an administrative law judge (hereinafter the ALJ) on November 19, 2007. At the commencement of the hearing, the Division moved to add Bailey as a party respondent, and the ALJ reserved decision.

Fitzgerald testified that, during her employment interview with Bailey, the manager of Alliance's collections department, Bailey told her that he was attracted to her and “was willing to give [her] a try” despite her lack of experience in the mortgage industry. Fitzgerald was hired, and she began working for Alliance on December 9, 2005, as a collections customer service representative. Fitzgerald further testified that, beginning that month, and continuing throughout her employment, Bailey made inappropriate comments and touched her inappropriately. As recounted by Fitzgerald on Friday, June 2, 2006, Fitzgerald sent an e-mail to Alliance's human resources manager, Ellen Spaventa, and asked to meet with her for the purpose of discussing Bailey's behavior. Fitzgerald explained that, at the meeting, which took place on that day, Fitzgerald detailed the inappropriate comments and conduct. According to Fitzgerald, Spaventa said that she would speak to Bailey and set up a meeting with Fitzgerald, Spaventa, and Bailey to resolve the issue. That same day, at 4:55 P.M., Bailey called Fitzgerald into the conference room and terminated her employment.

Fitzgerald testified that she knew Murphy while she was employed by Alliance, but was not aware of any “active role” he had in her employment. After Fitzgerald completed her testimony, the Division rested.

At the end of the day's proceedings, the ALJ denied the Division's application to add Bailey as a respondent, “given the fact that a lot of time has passed, the statute of limitations issues that ... may relate to that [sic].” Notable as well, the ALJ stated: “this is something that should have been brought up much earlier in these proceedings and I don't wish it to delay the speedy resolution.”

The next day, Alliance presented its case. Spaventa testified, and disputed key portions of Fitzgerald's testimony. Among other things, she testified that Fitzgerald's probationary period had been extended in April 2006, and that Bailey had told Spaventa earlier in the week during which Fitzgerald was terminated that Fitzgerald should be terminated because of poor work performance. According to Spaventa, terminations took place only on Fridays; after Fitzgerald made her complaint that Friday, the decision was made to go forward with the termination that day. As Spaventa recalled, both Bailey and Murphy were aware of the complaint, and Spaventa investigated it by speaking with two other employees. Spaventa explained that Murphy approved the termination. Spaventa also testified that Alliance was going out of business and that, at the time she testified, she was the only employee remaining on the payroll.

Fitzgerald offered rebuttal testimony in which she acknowledged that her probation had been extended in April 2006.

On January 25, 2008, after the hearing, the ALJ forwarded to the parties his proposed order. In it, the ALJ recommended a finding that Alliance had discriminated against Fitzgerald on the basis of sex because it condoned the sexual harassment she experienced, that Alliance had retaliated against Fitzgerald by terminating her employment, and that Fitzgerald was entitled to back pay and damages for mental anguish.

Both parties promptly filed objections. The Division's Prosecutions Unit requested to reopen the hearing and to add Bailey and Murphy as respondents. In particular, the Prosecutions Unit argued that Murphy, “as Alliance's president, played an active role in Ms. Fitzgerald's termination, ratifying his subordinate's decision to dismiss the Complainant,” and that “Bailey should ... be added as an aider and abettor.” Murphy objected to being added as a respondent given the passage of time and the lack of notice that he would be named.

On February 25, 2008, on behalf of the Commissioner of the Division (hereinafter the Commissioner), Adjudications Counsel amended the case caption to include Murphy (but not Bailey) individually as a respondent. Additionally, the matter was returned to the Division's Hearings Unit to reopen the record to allow Murphy to defend against the complaint.

Murphy, now represented by counsel, testified at the reopened hearing before the same ALJ who had conducted the initial hearing. Following the hearing, that ALJ recommended in his “Recommended Findings of Fact, Opinion and Decision, and Order,” dated November 24, 2008, that both Alliance and Murphy be held liable for discrimination and retaliatory discharge, and that Fitzgerald be awarded the principal sums of $26,527 in damages for back pay and $25,000 in compensatory damages for mental anguish and humiliation during her employment and after her termination. On July 3, 2009, the Commissioner adopted the ALJ's recommendations in full and issued his final order.

Murphy, but not Alliance, commenced this proceeding under Executive Law § 298 in the Supreme Court, Nassau County, to vacate and annul the July 3, 2009, determination, and the Division cross-petitioned to enforce it. The proceeding and cross proceeding were transferred to this Court ( see Executive Law § 298). Murphy contends that the statute of limitations had already passed when he was added as a respondent; that his addition as a respondent, after he appeared pro se on behalf of his company at the hearing, violated his due process rights; that no basis exists in the record for a finding that he condoned any discrimination suffered by Fitzgerald or was involved in a retaliatory discharge; and that the back pay award is excessive.

The Human Rights Law (Executive Law article 15) provides that persons aggrieved by certain forms of unlawful discrimination ( see Executive Law §§ 296, 296–a, 296–b) may seek redress in an administrative proceeding or in a court action. Executive Law § 297(5) requires that a complainant seeking redress through an administrative proceeding must file a complaint “within one year after the alleged unlawful discriminatory practice” ( see also 9 NYCRR 465.3[e] ). The statute directs the Division to take certain steps upon the filing of a complaint. The Division “shall promptly” serve the respondent and any necessary party with copies of the complaint and make a “prompt investigation” (Executive Law § 297[2][a]; see Executive Law § 292 [16]; 9 NYCRR 465.3[g] ). It “shall” also, within 180 days after the complaint has been filed, determine if it has jurisdiction and, if so, whether there is “probable cause to believe that the person named in the complaint, hereinafter referred to as the respondent, has engaged or is engaging in an unlawful discriminatory practice” ( id.). If the Division determines that there is probable cause, it “shall,” within 270 days after the complaint has been filed, issue a written notice to the respondent requiring an answer to the complaint, as it may have been amended, and an appearance at a public hearing within between 5 and 15 days after service of the notice (Executive Law § 297[4][a] ). Then, within 180 days after commencement of the hearing, the Division “shall” make a determination and serve an order (Executive Law § 297[4][c] ). The statute also gives the Division broad remedial and punitive powers to effectuate the purposes of the Human Rights Law ( see Executive Law §§ 290[3], 297[4][c]; Matter of Freudenthal v. County of Nassau, 99 N.Y.2d 285, 289–291, 755 N.Y.S.2d 56, 784 N.E.2d 1165).

The provision that a complaint “must” be filed within one...