4 No. 118
In the Matter of Jake Bello,
Ph.D., et al.,
Respondents, v. Roswell Park Cancer Institute,
et al.,
Appellants.
2005 NY Int. 109
June 29, 2005
This opinion is uncorrected and subject to revision before
publication in the New York Reports.
Robert M. Goldfarb, for appellants. Josephine A. Greco, for respondents.
R. S. SMITH, J.:
We hold that an award of back pay pursuant to Civil Service Law § 77 may not include pre-decision interest.
Facts and Procedural History
Petitioners are research scientists who were laid off
by the Roswell Park Cancer Institute (RPCI), a State institute
under the management and control of the Department of Health.
They brought a CPLR article 78 proceeding against RPCI, the
Department, and several other State agencies and officials
(collectively, the State), challenging the layoffs. Supreme
Court held that the layoffs were unlawful and that petitioners
were entitled to back pay with interest on each installment "from
the date it was incurred, if such designation is possible or from
a single reasonable intermediate date."
The Appellate Division modified Supreme Court's
judgment in a way not relevant here, and otherwise affirmed. The
State appeals, pursuant to leave granted by this Court,
challenging only the pre-decision interest award. We now reverse
the Appellate Division's order insofar as it is appealed from.
Discussion
Pre-judgment or pre-decision interest generally was not
available at common law ( see Monessen Southwestern Ry. Co. v
Morgan, 486 US 330, 337 [1988]). Before the adoption of the
Civil Practice Law and Rules, interest was allowed in New York in
certain kinds of cases, sometimes without statutory authority
( see former Civil Practice Act § 480; Flamm v Noble, 296 NY 262
[1947]; Wilson v City of Troy, 135 NY 96 [1892]), but today
interest is purely a creature of statute ( seeCPLR 5001 ; Matter
of Meloni v Goord, 267 AD2d 977, 978 [4th Dept 1999]). The
controlling statute in this case is Civil Service Law § 77, which
provides:
"Any officer or employee who is removed from
a position in the service of the state or of
any civil division thereof in violation of
the provisions of the chapter, and who
thereafter is restored to such position by
order of the supreme court, shall be entitled
to receive and shall receive from the state
or such civil division, as the case may be,
the salary or compensation which he would
have been entitled by law to have received in
such position but for such unlawful removal,
from the date of such restoration, less the
amount of any unemployment insurance benefits
he may have received during such period.
Such officer or employee shall be entitled to
a court order to enforce the payment of such
salary or compensation."
The State argues that interest is unavailable in this
case because Section 77 makes no mention of it. Petitioners
argue that a right to interest is implicit in the statute's
reference to "compensation"; they say that a claimant who is
deprived for a period of time of money that he or she is entitled
to cannot be fully compensated unless interest is awarded. We
agree with the State, and reject petitioners' argument. The statute does not just create a general right to
"compensation"; it is specific about what a claimant "shall be
entitled to receive." It speaks of "salary or compensation" --
indicating that "compensation" refers to bonuses or other non-
salary forms of payment. It provides for the deduction of
unemployment insurance benefits. Until 1985, it also provided
for deduction of "compensation which [the reinstated employee]
may have earned in any other employment or occupation" (Civil
Service Law former § 77), thus adopting the common law
"mitigation of damages" rule. When the statute was amended to
eliminate the mitigation requirement, the amendment did not
contain any provision for interest. We conclude that a
Legislature giving such careful attention to the components of a
back pay award would have added the words "with interest" if it
had intended interest to be awarded. In interpreting Section 77, we give some weight to the
fact that it provides for recoveries against "the state" as well
as "any civil division thereof." To the extent that it allows
recovery against the State, the statute waives the State's
sovereign immunity. Such waivers are to be strictly construed,
"waiver of immunity by inference being disfavored." ( Sharapata v
Town of Islip, , 56 NY2d 332, 336 [1982]; see Krohn v New York City
Police Dept., 2 NY3d 329, 338 [2004]). This rule reinforces our
reluctance to find an implicit provision for interest in a
statute that makes no mention of it. Petitioners argue that it is unfair to deny them
interest on money that has been wrongly withheld from them.
There is force in this argument, but we may not rewrite the
statute to achieve more "fairness" than the Legislature chose to
enact. The Legislature did not have to permit recovery of back
pay at all; nor did it have to eliminate the mitigation
requirement -- a feature of the statute that will, in some cases,
give wrongly terminated employees a substantial windfall. Having
allowed for back pay, and having eliminated the requirement of
mitigation, the Legislature did no more. Finally, petitioners argue that they are entitled to
interest under CPLR 5001 (a), which says: "Interest shall be
recovered upon a sum awarded because of a breach of performance
of a contract, or because of an act or omission depriving or
otherwise interfering with title to, or possession or enjoyment
of, property." We find this argument to be without merit.
Petitioners are not suing for breach of contract or for injury to
or interference with any property. They are suing to enforce the
right to back pay given to them by Civil Service Law § 77, and
that statute does not provide for pre-decision interest. Accordingly, the order of the Appellate Division,
insofar as appealed from, should be reversed, with costs, and the
case remitted to Supreme Court with directions to delete the
award of pre-decision interest.