Dentom Transportation, Inc. v. New York City Human Resources Administration

155 Misc. 2d 31, 588 N.Y.S.2d 713, 1992 N.Y. Misc. LEXIS 356
CourtNew York Supreme Court
DecidedJuly 20, 1992
StatusPublished
Cited by4 cases

This text of 155 Misc. 2d 31 (Dentom Transportation, Inc. v. New York City Human Resources Administration) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dentom Transportation, Inc. v. New York City Human Resources Administration, 155 Misc. 2d 31, 588 N.Y.S.2d 713, 1992 N.Y. Misc. LEXIS 356 (N.Y. Super. Ct. 1992).

Opinion

OPINION OF THE COURT

David B. Saxe, J.

In order to avoid awarding contracts to corrupt enterprises, the new New York City Charter gives the City Comptroller the right to object to registration of a contract between the City and a private contractor, and requires the Mayor to review the submitted evidence and uphold or disagree with the objection to the contract. This proceeding clarifies the rights and obligations of the contractor, the Comptroller and the Mayor when such an objection is interposed.

In this CPLR article 78 proceeding, petitioner Dentom Transportation, Inc. (Dentom) seeks an order directing respondents to register and award to Dentom a busing contract for the transport of Human Resources Administration (HRA) [33]*33employees to and from work. Dentom further seeks to permanently enjoin HRA from rebidding the work and from awarding a contract for this work to any contractor other than petitioner. Petitioner also seeks an order requiring the City to compensate it for work it rendered to respondent under temporary ID No. 1-0636.

In September 1990, Frank Braccia was convicted, as a result of a plea bargain, of the misdemeanor of giving an unlawful gratuity. His conviction was the result of a 1986-1987 investigation in which an undercover police officer posed as a New York State Department of Transportation school bus inspector. Mr. Braccia was named by the undercover officer as one of 41 people representing 55 City school bus companies who offered him a bribe of between $10 to $10,000 in order to overlook violations ranging from faulty breaks and steering columns to minor infractions. Of the 14 buses presented for inspection by Mr. Braccia, five were owned by Dentom.

In January 1991, Dentom submitted a bid in the amount of $363,042 for transportation services to HRA over a two-year period. On March 4, 1991, Dentom was informed in writing by HRA that it had submitted the low bid on the contract. This letter further stated that the contract had to be registered and certified with the Office of the Comptroller prior to the commencement of its terms. Dentom began providing shuttle service to HRA in March 1991, even though the contract had not yet been registered.

This new requirement for registration of the contract with the Office of the Comptroller was pursuant to a new provision, section 328 of the New York City Charter adopted November 1989. The provision empowers the Comptroller to object to the contract’s registration within 30 days of the filing of the contract, on the basis of "possible corruption in the letting of the contract or that the proposed contractor is involved in corrupt activity.” The Mayor must then review the evidence that the Comptroller has submitted and the Comptroller’s basis for any objections, and can either uphold or disagree with the objection.

On June 21, 1991, the contract was delivered to the Comptroller for registration. Pursuant to the newly provided power in the 1989 Charter, respondent Holtzman, in her capacity as Comptroller of the City of New York, initiated an investigation.

She interviewed the principal of Dentom, Ms. Lia, and [34]*34elicited several sworn statements. In a statement sworn to on July 8, 1991, Ms. Lia stated, "Frank Braccia was never and is not now associated with Dentom in any official capacity (whether as a manager, an employee, or a full or partial owner). His sole relationship with Dentom consisted of occasionally driving a bus for the company. He has not driven any buses for Dentom since 1987” (emphasis added).

Additionally, in an interview conducted by the Comptroller’s staff on July 16, 1991 with the undercover officer who had taken part in the criminal investigation of Mr. Braccia, the undercover officer stated that it was Mr. Braccia who regularly presented Dentom vehicles for inspection and it was Mr. Braccia who frequently signed completed inspection forms prepared by the officer. According to the officer, Frank Braccia brought in Dentom’s vehicles "all the time.” The Comptroller notes that Ms. Lia’s sworn statement of July 18, 1991 that "Frank Braccia’s indictment had nothing to do with Dentom Transportation” is belied by the fact that Mr. Braccia’s conviction was in connection with his presentation of Dentom buses for inspection. Furthermore, the Comptroller posed the following question to Ms. Lia in writing: "Did Mr. Braccia ever take any vehicles owned or operated by Dentom in for inspection and/or was he ever present at any inspections of Dentom buses?” (Emphasis added.) The Comptroller notes that in her sworn statement of July 18, 1991 Ms. Lia did not respond to this question but answered instead by identifying the individual who currently presents Dentom vehicles for inspection. Ms. Lia also affirmatively swore that: "Frank Braccia was never an owner, officer or manager of Dentom * * * In 1989, at the time of his indictment, Frank Braccia was in fact my husband, but he was not an owner, or officer, nor held a managerial position in Dentom Transportation, Inc.” However, this assertion was in contradiction to a file obtained from the Department of General Services (DGS), Division of Real Property, regarding the 1987 sale of 8 Rome Avenue, Staten Island, by New York City to Dentom. Each of the documents in the file was signed by "Francis Braccia” or "Frank Braccia” on behalf of Dentom. Francis Braccia was identified as the president of Dentom on many of these documents.

On July 19, 1991, in a letter to Mayor David Dinkins, the Comptroller objected to the registration of the contract and declined to register it because of the apparent falsity of sworn statements submitted by Ms. Lorraine Lia, Dentom’s president [35]*35and Frank Braccia’s ex-wife. The Comptroller also objected to the involvement of Mr. Braccia in the affairs of Dentom. According to the Comptroller, "Ms. Lia’s statement that Mr. Braccia’s sole relationship with Dentom consisted of occasionally driving a bus is apparently inaccurate.”

Michael Rogers, the Mayor’s representative, then reviewed the Comptroller’s written objection and attached memorandum and exhibits. During the period of his review, he received the letters from Ms. Lia and held a face-to-face meeting with Ms. Lia at her request in which he questioned her about Mr. Braccia’s relationship with Dentom. Rogers noted that in her July 22, 1991 letter to him, she stated "Francis Braccia has no relationship with Dentom,” yet her earlier July 8, 1991 statement said that Frank Braccia "occasionally” drove Dentom buses.

Although Rogers concluded that there was insufficient evidence as to Ms. Lia’s knowledge of Braccia’s activity in purchasing and selling 8 Rome Avenue on behalf of Dentom (despite the fact that they were married at that time and she was the president of Dentom), Rogers upheld the Comptroller’s objection to registration of the contract. He concluded that Lia had filed and sworn to false statements in her July 8, 1991 statement where she asserted that Frank Braccia was never associated with Dentom.

Petitioner now proceeds under CPLR 7803 (3). In CPLR article 78 proceedings, "The courts cannot interfere unless there is no rational basis for the exercise of discretion or the action complained of is 'arbitrary and capricious’ ” (Matter of Pell v Board of Educ., 34 NY2d 222, 231 [1974]). "Once a rational basis for [an administrative] determination is found to exist, the court’s power to interfere in the award of a contract arising out of the bidding process is ended” (Abco Bus Co. v Macchiarola,

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Bluebook (online)
155 Misc. 2d 31, 588 N.Y.S.2d 713, 1992 N.Y. Misc. LEXIS 356, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dentom-transportation-inc-v-new-york-city-human-resources-administration-nysupct-1992.