The Article 78 Lawsuit – Part I
March 14, 2018

The Article 78 Lawsuit - Part I by James StevensBy James Stevens, Esq.

{4:42 minutes to read}  On Wednesday, January 24, 2018, our law firm, Gerstman Schwartz LLP filed an Article 78 proceeding in New York County Supreme Court on behalf of a NYC licensed master plumber, challenging the determination of the NYC Office of Administrative Trials and Hearings (OATH). OATH is not a court of law, but an agency empowered by the laws and code of NYC to conduct hearings that are referred by other city agencies, including the NYC Department of Buildings (DOB).

It was the DOB that issued the summons, which is an appearance ticket, to our client. The summons was one of over one hundred issued to various NYC licensed plumbers. It accused our client of violating Section 28-401.19.6 of the Administrative Code of the City of New York, which is titled “Suspension or Revocation of License or Certificate of Competence.” It suggests that someone who is charged and found to be responsible for a violation would be subjected to suspension or revocation of license. This threatened our client’s NYC City Master Plumber license.

On this summons, our client was accused of violating Subsection 6, which lists “negligence, incompetence, lack of knowledge, or disregard of this code and related laws and rules.” Our client has been a licensed plumber for 50 years and is a principal member of one of the largest plumbing firms in NYC. The language of subsection 6 is very broad: What is negligence? What constitutes incompetence, lack of knowledge, or disregard of the code?

One of our arguments against this summons is that any charged violation or any summons issued pursuant to §28-401.19 can only be heard at the OATH trials division, and not at the OATH hearings division. That was one of our threshold arguments. The hearings division was an improper forum to hear a violation of this section of the code. This fact was even undisputed by the DOB attorney who attended the hearing. The OATH trials division, and not the OATH hearings division, is the exclusive forum for any proceeding that DOB may initiate against one of its licensees.

So, why were we at the hearings division? §28-401.19 also permits DOB to impose a monetary fine, not to exceed $25,000. It says that the Commission has the power to suspend a license, revoke a license, or impose a monetary fine.

The DOB argued that they were not seeking to suspend or revoke the license, only a monetary fine. In that case, it would be correct to have a hearing at the hearings division.

However, our primary argument was that the title of the section that was brought against our client is “Suspension or Revocation of License or Certificate of Competence.” Period. There’s nothing about a monetary fine, so for the DOB’s intention to only pursue a fine to be the deciding standard for whether or not the OATH hearings division has jurisdiction over this section of the code, simply doesn’t make sense.

The initial result for us when we had the hearing at the OATH hearings division was success. The summons was dismissed by the OATH hearing officer on multiple grounds. In a two-page decision, she found: “Based upon the foregoing, the instance summons is dismissed. I find that the summons does not belong in this forum. I also find that this summons does not make out a prima facie case.

We thought that was the end, until the DOB’s attorneys appealed the decision to the OATH appeals board, where they review appeals made by either the government, the contractors or the plumbers who received the summons.

In our next blog, we will outline the results of that appeal.