Kountz v. State University

109 Misc. 2d 319, 437 N.Y.S.2d 868, 1981 N.Y. Misc. LEXIS 2396
CourtNew York Supreme Court
DecidedMarch 17, 1981
StatusPublished
Cited by9 cases

This text of 109 Misc. 2d 319 (Kountz v. State University) 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
Kountz v. State University, 109 Misc. 2d 319, 437 N.Y.S.2d 868, 1981 N.Y. Misc. LEXIS 2396 (N.Y. Super. Ct. 1981).

Opinion

OPINION OF THE COURT

Irving S. Aronin, J.

This is a declaratory judgment action tried before the court without a jury.

The plaintiffs consist of 29 licensed physicians in the State of New York, who are employed by Downstate Medi[320]*320cal Center College of Medicine (hereinafter Downstate), in Brooklyn, New York, to teach medicine. Downstate is operated, managed and controlled by the State University of New York (hereinafter SUNY).

The complaint asserts two causes of action. In the first, plaintiffs allege and seek a declaration that article 8-AA of the Education Law, entitled “Clinical Practice Income Management Corporations”, does not apply to fees for medical services rendered by the plaintiffs to their own private practice patients because such private practice is not related to their employment as teachers at Downstate. As a second and alternative cause of action, plaintiffs seek a declaration that if article 8-AA is found to be applicable to their private practice then said statute is unconstitutional and invalid on the dual grounds that it deprives the plaintiffs of property without due process of law and denies them equal protection of the law.

Article 8-AA was added to the Education Law in 1973 as sections 385-a through 385-i. A “Statement of legislative intent” is set forth in the statute as section 385-a. This section reads as follows: “It is the sense of the legislature that the current methods for the collection of, and accounting for, income generated by teaching professionals employed in a medical or dental school at a state university of New York medical center or health science center in the course of performing services related to their employment are inadequate and fail to serve properly the needs of the medical and dental schools, the state university system or the people of the state of New York. The purpose of this article is to provide a mechanism for the collection, management and ultimate disbursement, including disbursements for the purpose of making salary adjustments, of all such income and pursuant to which proper accounting and auditing measures may be implemented, and such purpose is hereby declared to be a public purpose, essential to the public interest.”

Other relevant provisions of article 8-AA include the following:

“§ 385-b. Definitions
“As used in this article, unless the context otherwise requires:
[321]*321“(a) ‘Clinical practice’ means the act of providing any form of medical and health care, including patient consultations, and the act of performing clinical investigation involving patients, for which acts a fee for professional services is customarily charged.
“(b) ‘Clinical practice income’ means all income resulting from fees charged for professional services rendered in connection with clinical practice, but shall not include research grants, royalties, honoraria for lectures or income from consultations unrelated to patient care.”
“§ 385-c. Restriction on clinical practice
“Notwithstanding any other law or the provisions of any agreement or contract, no employee serving in a position of academic rank in a medical or dental school at a state university of New York medical center or health science center having in operation a clinical practice income management corporation formed pursuant to this article may engage in any clinical practice except as a member of such corporation and in accordance with the provisions of this article and with the rules and procedures promulgated by the governing board of such corporation. For the purposes of this section, clinical practice at an affiliated institution shall be deemed to be clinical practice at a state university of New York medical or dental school. In addition to membership in the corporation, every such employee shall be a member of either a school-wide clinical practice plan or a clinical practice plan organized along one or more departmental lines. Selection of the plan structure shall be made on a departmental basis by vote of a majority of the members of the department. Membership in a corporation and a clinical practice plan shall, for the purposes of this chapter, be a condition of employment for any such employee who engages in clinical practice, except that the trustees may exempt from the provisions of this section such employees as are deemed to be engaged in part-time employment. Nothing herein shall prohibit the employment by the corporation of any member thereof.”
“§ 385-e. Purposes and powers of the corporation
“The purposes of the corporation shall be to collect, manage and disburse, on behalf of the medical or dental [322]*322school, all clinical practice income generated by employees of the school engaged in clinical practice in connection with their employment, and each corporation created pursuant to this article shall have the following powers:
* * *
“(g) To collect all clinical practice income generated by any of its members in accordance with a system established by the governing board and approved by the trustees and the state comptroller”.

In contrast to the plaintiffs’ position that their non-teaching-related private practice income is not encompassed within the definition of clinical practice income, the posture of the defendants is that it includes all of the doctors’ private practice fees. The plaintiffs’ position was upheld in a decision dated January 10, 1977 by a former Justice of this court, wherein he granted the plaintiffs’ motion for summary judgment, declaring that “Article 8-AA of the Education Law is applicable to only those services rendered by doctors in connection with their employment as teaching professionals at the SUNY Medical Colleges. This does not encompass, generally, the services rendered by the doctors, and the fees earned therefrom, to patients in their private practice” (Kountz v State Univ. of N. Y., 89 Misc 2d 483, 491).

Upon appeal of this decision, the Appellate Division, Second Department, reversed, holding that “a trial is necessary, at which the parties may present evidence, inter alia, of the intent of article 8-AA of the Education Law; the matters that it sought to correct or revise; and, to the extent that it may appear to be relevant, the relationship between the care of private patients by faculty professionals employed by SUNY and the performance by them of services related to their employment” (Kountz v State Univ. of N. Y., 61 AD2d 835, 836). This trial ensued.

Upon the trial the following testimony and documentary evidence was adduced:

Plaintiffs’ case consisted of the trial testimony of two of the plaintiffs, their pretrial depositions and those of two other plaintiffs, the reading into evidence parts of the deposition of one of defendants’ witnesses, and the submis[323]*323sion of various documents. The testimony and depositions of the four doctors disclose that their teaching duties include classroom lectures, conferences with students, making rounds examining patients in hospital wards and instructing students during these rounds, performing surgical operations and teaching and explaining such surgery to medical students who observe the operations, and research. The doctors also engage in a private practice between 8 and 20 hours a week.

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Kountz v. State University
87 A.D.2d 605 (Appellate Division of the Supreme Court of New York, 1982)

Cite This Page — Counsel Stack

Bluebook (online)
109 Misc. 2d 319, 437 N.Y.S.2d 868, 1981 N.Y. Misc. LEXIS 2396, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kountz-v-state-university-nysupct-1981.