Mehtani v. New York Life Ins. Co., 1
| Decision Date | 14 February 1989 |
| Docket Number | No. 2,No. 1,1,2 |
| Citation | 145 A.D.2d 90,537 N.Y.S.2d 800 |
| Parties | , 49 Fair Empl.Prac.Cas. (BNA) 247, 50 Empl. Prac. Dec. P 39,044 Satish MEHTANI, et al., Plaintiffs-Respondents, v. NEW YORK LIFE INSURANCE COMPANY, et al., Defendants-Appellants, and "John Doe", et al., Defendants. ActionNEW YORK LIFE INSURANCE COMPANY, Plaintiff, v. Satish MEHTANI, et al., Defendants. Action |
| Court | New York Supreme Court — Appellate Division |
Irwin M. Berg, of counsel (Fuchsberg & Fuchsberg, attorneys), New York City, for plaintiffs-respondents.
Peter M. Panken, of counsel (Daniel S. Greenfeld and Kenneth R. Davis with him on the brief; Parker, Chapin, Flattau & Klimpl, attorneys), New York City, for defendants-appellants.
Before MURPHY, P.J., and SULLIVAN, CARRO and KASSAL, JJ.
Section 296(13) of the Executive Law, commonly referred to as the "Arab Boycott Law", does not apply to the cancellation of an employment contract or the discharge of an employee where the alleged act of discrimination did not occur in the course of an organized boycott or blacklisting.
In August 1982, plaintiffs-respondents, Satish Mehtani and Sneh Mehtani, his wife, commenced the above-captioned Action No. 1 against defendants-appellants, New York Life Insurance Company ("New York Life") and its senior vice president in charge of marketing, Lee Buck, and defendants "John Doe" and "Richard Roe", investigators assigned to Buck's department. The original verified complaint stated two causes of action, the first alleging that Satish had been wrongfully discharged from the employ of New York Life because he was disliked by Buck and that Doe and Roe had conspired with Buck toward that end, and the second alleging that Sneh had sustained damages because the notice of termination had been deliberately timed to arrive one day before she and Satish were to be married.
Following a decision rendered by the Court of Appeals on March 29, 1983, holding that, "This court has not and does not now recognize a cause of action in tort for abusive or wrongful discharge of an employee ...", Murphy v. American Home Products Corporation, 58 N.Y.2d 293, 297, 461 N.Y.S.2d 232, 448 N.E.2d 86, plaintiffs amended their complaint to add the allegation that the discharge of Satish, an American citizen born in India, was racially motivated, and to assert a claim for loss of consortium on behalf of his wife, Sneh. The allegation of racial discrimination was grounded in a 1976 incident in which Lee Buck was said to have angrily confronted Satish at a special club for New York Life's most successful salespersons, saying, . Satish further alleged that three years later, in December 1979, Buck had a private meeting with him in which he stated:
Don't think I have forgotten you. I am going to get your ass out of New York Life the first chance I get. I have had enough from you f---ing Indians. I would like to get rid of every one of you. You think you own the place. You Indians come to this country and you think everything is coming to you.
At about the time that this meeting took place, the circumstances under which Satish had sold a life insurance policy to a woman who died six months thereafter were under investigation. As a result of that investigation, New York Life commenced an action in July 1982, designated herein as Action No. 2, against Satish and a medical doctor, Sarup Sharma, alleging that they had conspired to fraudulently obtain the policy without a medical examination for the woman, who had a serious heart condition. The two lawsuits were subsequently consolidated as above captioned.
In denying defendants-appellants' motion for summary judgment dismissing Satish and Sneh Mehtani's complaint, Special Term held that there existed a question of fact as to whether Satish was an independent contractor or an employee, an issue bearing on the applicability of Executive Law § 296(1)(a). The court further held that even if Satish were found to be an independent contractor and thus ineligible for relief pursuant to Executive Law § 296(1)(a), he could nevertheless prosecute a claim of racial discrimination under Executive Law § 296(13). With respect to Sneh's loss of consortium cause of action, the court found that it was viable because Satish's discharge had become effective after the date of their marriage.
We first address the issue of whether there exists a genuine question of fact regarding Satish's status with New York Life. It is undisputed that the proscription against unlawful discriminatory practices contained in Executive Law § 296(1)(a) applies solely to employees and not to independent contractors. The statute provides as follows:
1. It shall be an unlawful discriminatory practice:
(a) For an employer or licensing agency, because of the age, race, creed, color, national origin, sex, or disability, or marital status of any individual, to refuse to hire or employ or to bar or to discharge from employment such individual or to discriminate against such individual in compensation or in terms, conditions or privileges of employment.
Satish's association with New York Life commenced on July 1, 1971, when the parties entered into an Apprentice Field Underwriter's Agreement for an initial two-year period. This contract, which authorized Satish to solicit applications for insurance policies on behalf of New York Life, and outlined the terms and conditions upon which he would do so, contained the following provision:
Neither the term 'Field Underwriter' ... nor anything contained herein or in any of the rules or regulations of [New York Life] shall be construed as creating the relationship of employer and employee between [New York Life] and the Field Underwriter. Subject to the provisions hereof and within the scope of the authority hereby granted, the Field Underwriter, as an independent contractor, shall be free to exercise his discretion and judgment with respect to the persons from whom he will solicit applications, and with respect to the time, place, method and manner of solicitation and of performance hereunder.
At the expiration of the initial period, Satish continued his work as a field underwriter, with his compensation consisting solely of commissions. Consistent with the practice utilized for independent contractors, New York Life did not deduct any withholding taxes from these commissions. Other indicia of independent contractor status was Satish's hiring of a secretary whose...
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