Krohn v. New York City Police Department

OPINION OF THE COURT

Plaintiff Alii Katt^[1] sued her former employer, the New York

This action was commenced roughly nine years ago, in 1995, and has an extensive procedural history. The complaint originally named three additional individual defendants and alleged several causes of action. At the time of trial, plaintiffs only remaining claims were for violations of 42 USC § 1983 , the New York State Human Rights Law (Executive Law § 290 et seq.) and New York City Human Rights Law (Administrative Code of City of NY) § 8-502, against the City and DiPalma.

After trial in the United States District Court for the Southern District of New York, the jury delivered a verdict in plaintiffs favor, awarding $400,000 in compensatory damages against both defendants and $1,000,000 in punitive damages against the City. In response to defendants’ motions for judgment as a matter of law (see Fed Rules Civ Pro rule 50 [b]) or, in the alternative, for a new trial (see Fed Rules Civ Pro rule 59), the court struck the punitive damages award against the City, and otherwise directed entry of judgment for the plaintiff in the amount of $400,000. The court determined that punitive damages were not authorized under section 8-502 of the New York City Human Rights Law because the statute does not contain an unequivocal indication of legislative intent to waive the City’s common-law immunity from liability for such damages ( 151 F Supp 2d 313 , 345 [US Dist Ct, SD NY 2001]). The court subsequently denied plaintiffs motion for reconsideration.^[2]

Defendants appealed the District Court’s denial of their motion for a new trial, which the United States Court of Appeals for the Second Circuit affirmed. Plaintiff cross-appealed from the portion of the District Court’s order vacating the punitive damages award. Determining that there was insufficient guidance from this Court to resolve the issue, which raises significant state law public policy concerns, the Second Circuit certified the following question: “Can a person claiming gender-

Analysis

Plaintiff claims gender-based employment discrimination under section 8-502 (a) of the New York City Human Rights Law, which states that:

“Except as otherwise provided by law, any person claiming to be aggrieved by an unlawful discriminatory practice as defined in chapter one of this title . . . shall have a cause of action in any court of competent jurisdiction for damages, including punitive damages, and for injunctive relief and such other remedies as may be appropriate” (Administrative Code of City of NY § 8-502 [a]).

Under the Code, it is an unlawful discriminatory practice for an employer “to discriminate against [a] person in compensation or in terms, conditions or privileges of employment” because of the person’s gender (see Administrative Code § 8-107 [1] [a]).

The Code then defines “employer” by excluding those employers with three employees or less (see Administrative Code § 8-102 [5]), and does not differentiate between public and private employers. Although the definition of “person”^[3] includes “governmental bodies or agencies,” section 8-502 (a) uses “person” to refer to those aggrieved by discriminatory treatment, rather than those subject to liability for damages (see Administrative Code § 8-102 [1]; § 8-502 [a]). Plaintiff argues since this Court has previously determined that the New York City Transit Authority was an “employer” within the definition of the New York City Human Rights Law (see Matter of Levy v City Commn. on Human Rights, 85 NY2d 740 , 744 [1995]), that the City should also be considered an “employer” here. However, holding the City to be an “employer” for the purposes of the Human Rights Law, does not of itself constitute legislative authorization for punitive damages liability (see Sharapata v Town of Islip, 56 NY2d 332 , 336 n 5 [1982]).

Here, by contrast to Sharapata, the language of the Code provision expressly references punitive damages. The question is whether that reference is sufficient to imply the City’s waiver of immunity to liability for punitive damages. Under plaintiffs reading of the provision, since the City is within the definition of “employer” under section 8-102 (5), and an “employer” is prohibited from engaging in unlawful discriminatory practices under section 8-107 (1) (a), the City is expressly subject to punitive damages under section 8-502. We agree, however, with the District Court that this language is not an unambiguous expression of legislative authorization to subject the City to liability for punitive damages (see 151 F Supp 2d at 342-343 ) and is insufficient to waive the City’s immunity to punitive damages liability. The absence of any specific reference to the municipality in the provision itself supports the interpretation that there

Further, the statute begins with the phrase, “[e]xcept as otherwise provided by law” (Administrative Code § 8-502 [a]). It has been a common-law principle in this State that a municipality is not liable for punitive damages flowing from its employees’ misconduct in the absence of express legislative authorization to the contrary (see Sharapata, 56 NY2d at 336 ). Thus, “we must presume that the City Council was aware of the common-law rule and abrogated it only to the extent indicated by the clear import of its enactment” (Juarez v Wavecrest Mgt. Team, 88 NY2d 628 , 646 [1996] [citations omitted]; see also McKinney’s Cons Laws of NY, Book 1, Statutes § 301 [b]). The absence of any specific reference to the municipality, combined with the “[e]xcept as otherwise provided by law” language, suggest that the City Council in fact intended to preserve the principle of municipal immunity from punitive damages. At best, the provision is ambiguous as to imposition of punitive damages liability upon the City and thus cannot be considered express legislative authorization or abrogation of this well-settled principle.

In addition, as was the case in Sharapata, here there is no indication that the City Council discussed, debated or even contemplated exposing the City to punitive damages or the potential fiscal impact of punitive damages on the City. In fact, the Fiscal Impact Statement from the Finance Division of the City Council included in the Local Law Bill Jacket does not include potential punitive damages in its estimated impact on expenditures (see Local Law Bill Jacket, Local Law No. 39 [1991] of City of New York). The Statement did, however, mention that the proposed provision authorized civil penalties and calculated such penalties as revenue to the City (see Local Law Bill Jacket, Local Law No. 39 [1991]).

The general statements that the provision was intended to give “enhanced protection against discrimination” and should be liberally construed do not provide conclusive support for the

In short, persons claiming gender-based employment discrimination cannot recover punitive damages pursuant to section 8-502 as the provision does not clearly, expressly and specifically waive New York City’s sovereign immunity. In light of this determination, it is not necessary to address the City’s constitutional argument.

Accordingly, the certified question should be answered in the negative.

Chief Judge Kaye and Judges G.B. Smith, Rosenblatt, Graffeo, Read and R.S. Smith concur.

Following certification of a question by the United States Court of Appeals for the Second Circuit and acceptance of the question by this Court pursuant to section 500.17 of the Rules of Practice of the Court of Appeals (22 NYCRR 500.17), and after hearing argument by counsel for the parties and consideration of the briefs and the record submitted, certified question answered in the negative.