Psaty v. Duryea

118 N.E.2d 584, 306 N.Y. 413
CourtNew York Court of Appeals
DecidedMarch 12, 1954
StatusPublished
Cited by103 cases

This text of 118 N.E.2d 584 (Psaty v. Duryea) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Psaty v. Duryea, 118 N.E.2d 584, 306 N.Y. 413 (N.Y. 1954).

Opinion

Desmond, J.

Plaintiffs are building contractors who, having put in a bid to erect a building for the State, and having discovered, after the several competitive bids had been opened and theirs found to be the lowest, that they had made a serious omission in calculation of the amount of their bid, informed officials in the State Department of Public Works of the alleged error and requested that they (plaintiffs) be relieved of their bid because of the mistake, and that their bid check of $7,500 be returned. After conferences, the State officials refused to accede to this request. Plaintiffs then brought this action in the Supreme Court. In form, it runs, not against the State itself, but against various State officers. The complaint says that the defendant State officers have declared that the bid check, which is on deposit in a special fund of the State, will be declared forfeit and placed in the State’s general fund, that this will result in great and irreparable loss and damage, and that plaintiffs have no adequate remedy at law. The prayer for judgment is that the allegedly mistaken hid of plaintiffs he rescinded and cancelled, and that defendants be enjoined from declaring the plaintiffs in default or from transferring the bid check or declaring it forfeit, or from using the check in any way, or placing it in the State’s general fund, and for a direction that the bid check or its proceeds be returned to plaintiffs. The answer denies the allegations as to mistake by plaintiffs, and sets up an alleged separate defense to the effect that the State notified plaintiffs that theirs was the lowest bid and that it was accepted and the contract awarded to plaintiffs, that the contract documents were delivered to plaintiffs for execution by them, that plaintiffs refused to sign on account of the alleged [416]*416mistake, that several hearings or conferences were held between plaintiffs and State officers or their representatives, and that plaintiffs submitted certain working papers in an effort to prove they had made the mistake but that the papers did not support that claim, whereupon the State officials, on several occasions, repeated their demands that plaintiffs execute the contract, but that plaintiffs have continued to refuse to do so with the result that, on September 20, 1950, which was about three months after plaintiffs originally filed their bid and bid check, and nearly two months after plaintiffs were notified that their bid was accepted, the State, through its representatives, notified plaintiffs that their deposit of $7,500 was forfeited to the State. The answer contains a further allegation, not now particularly important, that the State, by reason of the default of plaintiffs, was compelled to award the contract to the bidder next higher than plaintiffs, which bid was higher by about $20,000 than the bid of plaintiffs.

At the trial, as by an earlier separate motion, the State continued to insist that the Supreme Court had no jurisdiction, besides asserting that no mistake had in fact been made by plaintiffs. Both those questions were decided in favor of plaintiffs. The Official Referee held that plaintiffs’ bid was mistakenly computed and was not plaintiffs’ real bid or one which they had ever intended to submit, and ordered that the bid be rescinded and cancelled, and that the defendant State officers be restrained from using the check in any manner, and that they return the check or its proceeds to plaintiffs, with the bid itself. While the Appellate Division reversed on the law and dismissed the complaint, its order specifically affirmed the facts as found by the Referee. Since that fact finding of a mistake, affirmed in the Appellate Division, was justified on this record, there is no question before us as to whether or not the mistake actually was made. The real question is one of jurisdiction of the Supreme Court to grant the demanded relief.

It seems to be conceded that the Court of Claims has, under section 9 of the Court of Claims Act, no jurisdiction to grant strictly equitable relief, but to award money damages only against the State, in appropriate cases. Plaintiffs assert that they, accordingly, could not have obtained relief against the State in the Court of Claims on this claim, since they would [417]*417have no rights unless and until their bid should be cancelled and rescinded, and that the Court of Claims, being without such equity jurisdiction, could not annul the bid. Therefore, say plaintiffs, they were compelled to bring this suit in equity in the Supreme Court to be relieved from their bid, to have the same declared cancelled, and for an injunction to keep the State officials from putting the money into the State’s general funds. Such would be a proper subject for the exercise of the equitable jurisdiction of the Supreme Court were it not for the fact that defendants are sued as officers of the State, dealing, within their powers, with moneys paid to the State, and that, accordingly, this is a suit against the State under the theory of Samuel Adler, Inc., v. Noyes (285 N. Y. 34), Breen v. Mortgage Comm, of State of N. Y. (285 N. Y. 425), and Niagara Falls Power Co. v. White (292 N. Y. 472). Since, therefore, it is such a suit against the State itself, the Appellate Division was correct in its unanimous dismissal of the suit on the jurisdictional ground since, concededly, the State has not given consent so to be sued. In the Presiding Justice’s opinion for the unanimous Appellate Division, it is stated that the broad grant of power given to the Court of Claims in sections 8, 9 and 12 of the Court of Claims Act “ necessarily implies the right to afford equitable relief where the same may be incidental to a claim for a money judgment ”. (282 App. Div. 94, 99.) We need not determine the full reach of that statement of law, since appellants’ contentions are defeated by the fact that this is a suit against the State itself attempted to be brought in the Supreme Court and, as such, subject to dismissal. We may assume that, in determining claims for money damages against the State, the Court of Claims may apply equitable considerations and perhaps, to some extent, may grant some sort of incidental equitable relief, but that concept has nothing to do with this case since this, in essence and by concession, is not a suit for money damages but, primarily, an equitable action to cancel and rescind a bid which equitable relief, as plaintiffs concede, was essential before there could be any injunction or mandate for the return of the money. In other words, this was a suit for traditional equitable relief, with the return of the money to follow as a consequence of the equitable relief, if granted.

[418]*418The Official Referee, in his opinion, said that the facts here were such as should, under equitable considerations, entitle the plaintiffs to relief. He pointed out, too, that the State has largely waived its ancient immunity as a sovereign. As to whether the State has waived that immunity so as to permit the prosecution of this suit in the Supreme Court, the only authority cited by the Official Referee was Levine v. Parsons (258 App. Div. 1003), as to which leave to appeal was denied by this court in 1940 (282 N. Y. 808). It cannot be denied that the Levine decision, resulting in the same kind of relief asked by plaintiffs herein, would seem to hold inferentially that there is jurisdiction in the Supreme Court of such a suit against a State officer; however, the jurisdictional point was not raised in Levine, and it is raised in the present case.

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Bluebook (online)
118 N.E.2d 584, 306 N.Y. 413, Counsel Stack Legal Research, https://law.counselstack.com/opinion/psaty-v-duryea-ny-1954.