Perez v. Dumpson
| Decision Date | 08 November 1976 |
| Citation | 88 Misc.2d 506,389 N.Y.S.2d 279 |
| Parties | Milagros PEREZ et al., Plaintiffs, v. James R. DUMPSON, Individually and as Commissioner of the New York City Department of Social Services and Frederico Costales, Individually and as Inspector General of the Human Resources Administration of the City of New York Defendants. |
| Court | New York Supreme Court |
Mark H. Spires, Long Island City, for plaintiffs; Robert L. Becker, Daniel J. Wise, Long Island City, fo counsel.
W. Bernard Richland, Corp. Counsel, by Barry L. Asen, Asst. Corp. Counsel, Hyman Frankel, Sp. Asst. Corp. Counsel, New York City, for defendants.
'Overpayments' made by the Department of Social Services to recipients in excess of the sum to which they may either be entitled or because of fraud or ineligibility have long been receiving the general paying public's notice to its annoyance and rage, as well as its complete lack of comprehension as to how or why it can occur or is even allowed to occur to such an extensive volume. To the public's complete consternation it has continued to occur and grow like an insidious cancer gnawing at the very vitals of public support, and to the overwhelming expense of those who are compelled by law to contribute. The general public cannot believe what they have read and been told of how ineligible as well as fraudulent recipients have extracted and still continue to extract millions upon millions of their hard earned dollars, funds obtained from them through taxation which should rightfully have gone to the true needy. That the public's moneys are said to have been carelessly squandered away by the Department of Social Services through the medium of agency employees making payments of public funds to persons not entitled thereto, either because of ineligibility or fraud or as to excessive amounts to which the recipient was not entitled, leaves the hard-working taxpaying citizen not only bewildered but completely distraught and thoroughly outraged.
The general public has a heart and conscience and no real deep-down antagonism to the truly needy recipients of public assistance, but it does have a furious rage against those who apply for and receive public assistance funds when not entitled thereto, that is, an amount in excess of what they may legitimately be entitled to, ineligible to receive any public assistance because of fraud, or sheer lack of care or inefficiency of said governmental agency (Department).
It is in this light and atmosphere that the plaintiffs herein, either present recipients or former recipients, have moved for a determination that this suit be permitted to be maintained as a 'class action' pursuant to Article 9 of the Civil Practice Law and Rules, and that as such 'class action', summary judgment be granted to plaintiffs, (a) declaring that the practice and policy of the Department of Social Services of the City of New York (Department) of taking 'confessions of judgment' from former and present recipients of public assistance who received 'overpayments' of assistance be enjoined; (b) that the 'confessions of judgment' previously obtained from such former and present recipients and filed in the courts of the State of New York be vacated, and (c) that the Department make 'restitution' to those members of the class from whom payments were received or exacted through court sanctioned enforcement of judgment procedures.
Before commencing this action the plaintiffs had commenced an action against these same defendants in the United States District Court for the Southern District of New York wherein the plaintiff's alleged, as they do here, in addition to what has been heretofore stated, that the policy of the defendants in demanding and obtaining 'confessions of judgment' violated the privilege against self-incrimination and their right to due process pursuant to the Fourth and Fifth Amendments to the United States Constitution. The parties therein stipulated that that court would abstain from any determination pending litigation of the present claims in the State court. This action thereafter followed.
The first branch of the plaintiffs' motion is for an order pursuant to Article 9 of the Civil Practice Law and Rules determining that this action can proceed as a 'class action' by 'all former and current recipients of public assistance who have been asked to confess, have confessed or in the future will confess or will be asked by the defendants or their duly authorized agents to confess judgment in favor of the Commissioner of Social Services of the City of New York for amounts of public assistance allegedly 'overpaid' to said persons'; Intending by such all present or former recipients regardless of whether such 'overpayments' are alleged to have occurred as a result of error on the part of the agency (Department) or misrepresentation or concealment by the recipient.
To support their present application plaintiffs contend that in the action in the United States District Court, in answer to certain interrogatories requested, the Department stated that in the years 1972 to the first half of 1975 (3 1/2 years) they Requested, through their CONCEALED ASSETS SECTION, confessions of judgment from 26,219 persons. The number is astonishing per se, but the amount of money which must have been involved must have reached fantastic heights and is more astounding. The number of 'confessions' requested is one of the bases for plaintiffs' application for leave to proceed by 'class action'.
Plaintiffs also claim that as a prerequisite to a 'class action', they have questions of law and fact which are common to the entire class and predominate over any questions affecting only individual members. In this regard Plaintiffs maintain that nowhere in the Social Services Law are defendants granted any authority to take 'confessions of judgment' from recipients regardless of which class such recipient may fit into; and, consequently, Any 'confessions of judgment' secured and setered by defendants have been obtained in excess of the Department's lawful authority. Plaintiffs further delineate their position. They state that defendants must have a valid cause of action to obtain confessions in lieu of suit against current or former recipients for the value of assistance provided to such recipients, but that as to such, they maintain, the cause is alleged by them on behalf of those members of the class 'who do not possess property from which recovery can be made', and that possession of property from which recovery can be made is a minimum basic condition precedent to suit, and pleading such is required.
Claiming that the question is solely one of law, that is, the lack of authority being common to all of the recipients, plaintiffs contend that summary judgment should be granted to them allowing the class action, enjoining defendant now and in the future from demanding or receiving confessions of judgment, directing restitution and vacating the confessions of judgment already received.
Plaintiffs basically contend that the basis for their challenging the Department's policy, practice and procedure of obtaining confessions of judgment from those recipients who received such 'overpayments' of assistance is that the Department's activities in so doing are illegal in that it exceeds its lawful authority; and that under the circumstances to even commence suit for such 'overpayments' in the absence of proof that such recipients are 'discovered to possess real or personal property from which restitution could be effected' is likewise without sanction or authority.
The principle of law is well settled that an administrative agency has the right to exercise only such powers as are conferred upon it by legislative fiat (Village of Boonville v. Maltbie, 272 N.Y. 40, 4 N.E.2d 209); except as to such powers as are necessarily implied as being essential to the exercise of another power expressly conferred and plainly free of doubt appearing to have been within the intent of the Legislature (People ex rel. City of Olean v. W.N.Y. & P.T. Co., 214 N.Y. 526, 529, 108 N.E. 847, 848).
Can it be said that the Department's effort to recoup funds fraudulently or improperly obtained from said Department by 'unjustly or fraudulently enriched recipients' is an act of assuming unauthorized power; power beyond legislative intended limits? This court is of the opinion that it does not.
Within the scope of the issue of 'authorized or implied power', the court will first examine the so-called 'stipulation issue' which the plaintiffs proclaim the defendants have agreed upon, and this court finds neither right nor power existent or implied within the purview of the Social Services Law, which in any way or to any extent authorizes such Department, created by legislative enactment, to relinquish or to stipulate away any of its rights or powers whether they be statutory or implied. To prosecute recipients, criminally or civilly, those who have obtained social service monetary assistance illegally because of ineligibility or fraud, or to make legal effort to seek reimbursement from those who have obtained so-labelled 'overpayments' erroneously is within the power implied in any such governmental agency if not statutori spelled out. This is especially so in a City where many worthy recipients are being forced to suffer because of the scheming, fraudulent and abominable activities of the undeserving. Not by hindsight is such so, but by legislative intent and foresight.
There are three (3) different classes of recipients to be separately considered, namely:
The first class of recipients are those who, although actually entitled to public assistance, through honest error on the part of the recipient or the Department, have received 'overpayments'. This class are recipients who are still receiving assistance and they are simply handled by Social Services, Law, section 106--b.
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