Manuel De La Cruz, et al., Appellants,v.Caddell Dry Dock & Repair Co., Inc., et al., Respondents.

Brief

N.Y.May 30, 2013

Bronx County Clerk’s Index No. 26220/02 Court of Appeals STATE OF NEW YORK MANUEL DE LA CRUZ, RAFAEL GUTIERREZ and FELIX MORET, individually and on behalf of all other persons similarly situated who were employed by CADDELL DRY DOCK & REPAIR CO. INC. and/or other entities affiliated or controlled by CADDELL DRY DOCK & REPAIR CO. INC. with respect to certain Public Works Projects awarded by THE CITY OF NEW YORK, THE NEW YORK CITY AND/OR NEW YORK STATE DEPARTMENT OF TRANSPORTATION, THE NEW YORK CITY DEPARTMENT OF SANITATION and/or other municipalities, public authorities or government entities, Plaintiffs-Appellants, against CADDELL DRY DOCK & REPAIR CO. INC., AMERICAN AUTOMOBILE INSURANCE COMPANY and AMERICAN MANUFACTURERS MUTUAL INSURANCE COMPANY, Defendants-Respondents. >> >> To Be Argued By: James Emmet Murphy Time Requested: 30 Minutes REPLY BRIEF FOR PLAINTIFFS-APPELLANTS VIRGINIA & AMBINDER, LLP Attorneys for Plaintiffs-Appellants Trinity Centre 111 Broadway, Suite 1403 New York, New York 10006 212-943-9080 Of Counsel: James Emmet Murphy Lloyd R. Ambinder Date Completed: February 14, 2013 i TABLE OF CONTENTS PAGE TABLE OF AUTHORITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 POINT I DEFENDANTS-RESPONDENTS’ ARGUMENT IN OPPOSITION FUNDAMENTALLY MISINTERPRETS THE NATURE OF PREVAILING WAGE LAWS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 A. The work at issue involved the “repair” of vessels, which are “construction” projects under New York law . . . . . . 3 B. Projects need not be “fixed” to constitute “public works” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 0 POINT II THE TREATMENT OF PREVAILING WAGES BY THE CONTRACTING AGENCIES AND COMPTROLLER’S OFFICE ARE IRRELEVENT TO THE DETERMINATION OF WHETHER THE WORK AT ISSUE CONSTITUTES “PUBLIC WORK” REQUIRING PAYMENT OF PREVAILING WAGES . . . . . . . 19 A. The Comptroller’s determination is both incorrect and irrelevant to Plaintiffs-Appellants’ claims . . . . . . . . . . . . 20 B. The ACCO’s statements are both irrelevant and inaccurate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 C. Plaintiffs-Appellants’ claims are not barred by estoppel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 PAGE ii POINT III FEDERAL AUTHORITY INTERPRETING THE DAVIS-BACON ACT AND MILLER ACT, WHILE NOT CONTROLLING, IS INSTRUCTIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 7 POINT IV PUBLIC POLICY CONSIDERATIONS REQUIRE THAT REPAIR OF PUBLIC VESSELS BE CONSIDERED “PUBLIC WORK” REQUIRING PAYMENT OF PREVAILING WAGES . . . . . . . . 3 7 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 PAGE -iii- TABLE OF AUTHORITIES Cases Action Elec. Contractors, Co. v. Goldin, 64 N.Y.2d 213 (1984).........................................................................40 Associated Builders & Contractors, Inc. v. Rochester, 67 N.Y.2d 854 (1986).........................................................................40 Austin v. City of New York, 258 N.Y. 113 (1932).................................................................33,36,41 Brang Co. v. State Univ. Constr. Fund, 365 N.Y.S.2d 914 (3d Dept. 1965)...................................9,23,24,26,33 Bessemer Water Services v. Lake Cyrus Dev. Co., 949 So.2d 643 (Ala. 2006)..................................................................11 Bucci v. Village of Port Chester, 22 N.Y.2d 195 (1968).........................................................................41 Caddy v. Interborough Rapid Transit Co., 195 N.Y. 415 (1909)...........................................................................15 Cadwallader v. New York State Dep’t of Labor, 112 A.D.2d 527 (3d Dept. 1985).....................................................7,27 Carson-Tahoe Hosp. v. Bldg. & Constr. Trades Council, 128 P.3d 1065 (Nev. 2006) ................................................................12 Chaffee v. Union Dry Dock Co., 73 N.Y.S. 908 (4th Dept. 1902).....................................................14,15 De La Cruz v. Caddell Dry Dock and Repair Co., 804 N.Y.S.2d 58 (1st Dept. 2005).......................................................20 Demeter Land Co. v. Florida Pub. Serv. Co., 128 So. 402 (Fla. 1930).......................................................................12 PAGE -iv- Don v. Joseph, 1 N.Y.2d 708 (1956)...........................................................................17 E. Williamson Roofing & Sheet Metal Co. v. Town of Parish, 530 N.Y.S.2d 720 (4th Dept. 1988)....................................................40 Erie County Indus. Dev. Agency v. Roberts, 94 A.D.2d 532 (4th Dept. 1983), aff’d, 63 N.Y.2d 810 (1984)......................................................20,21,26 Falk v. Gerosa, 138 N.Y.S.2d 425 (Sup. Ct. N.Y. Co. 1954)...............................passim Harding v. City of New York, 1988 WL 56729 (S.D.N.Y. 1988) (Connor, D.J.).................................9 Joint Indus. Bd. Of the Elec. Indus. v. Koch, 452 N.Y.S.2d 488 (N.Y.Sup.Ct. 1982).....................................13,24,26 Lantry v. State of New York, 6 N.Y.3d 49 (2005).............................................................................30 Lee v. City of Lynn, 111 N.E. 700 (Mass. 1916).................................................................12 Long Island Lighting Co. v. Indus. Comm’r, 338 N.Y.S.2d 751 (2d Dept. 1972), aff’d, 34 N.Y.2d 725 (1974)........................................................9,10,33 McManus v. Bd. of Educ., 87 N.Y.2d 183 (1995).........................................................................25 Mercer County v. Wolff, 86 N.E. 708 (Ill. 1908)........................................................................12 Miele v. Joseph, 280 A.D. 408 (1st Dept. 1952), aff’d, 305 N.Y. 667 (1953).............................................................10,33 PAGE -v- National R.R. Passenger Corp. v. Hartnett, 572 N.Y.S.2d 386 (3d Dept. 1991).....................................................26 Opportunity Center of Southeastern Illinois, Inc. v. E. Allen Bernardi, 562 N.E.2d 1053 (Ill. App.Ct. 1990).............................................12,13 Overstreet v. Houston County, 365 S.W.2d 409 (Tex.Civ.App.1963).................................................13 People v. Crane, 214 N.Y. 154 (1915)...........................................................................11 Raley v. California Tahoe Reg’l Planning Agency, 68 Cal.Appl.3d 965 (Cal. Ct. App. 1977)...........................................13 Regal Indus. Corp. v. Crum and Forster, Inc., 2005 PA Super. 425 (Pa.Super.Ct. 2005)...........................................29 Safari Circuits, Inc. v. Chicago Sch. Reform Bd. of Tr., 474 F.Supp.2d 993 (N.D.Ill. 2007)................................................13,14 Salla v. County of Monroe, 48 N.Y.2d 514 (1979).........................................................................41 Sewer Envtl. Contractors, Inc. v. Goldin, 469 N.Y.S.2d 339 (1st Dept. 1983)..........................................22,23,26 State v. A.H. Read Co., 240 P. 208, 33 Wyo. 387 (Wyo. 1925)...............................................12 Southern Surety Co. v. Standard Slag Co., 159 N.E. 559 (Ohio 1927)...................................................................12 Stephens and Rankin, Inc. v. Hartnett, 160 A.D.2d 1201 (3d Dept. 1990).................................................12,26 Surace v. Danna, 248 N.Y. 18 (1928).............................................................................36 PAGE -vi- Thaxter v. City of New York, 704 F.Supp. 531 (S.D.N.Y. 1989).........................................................9 Title Guar. & Trust Co. v. Crane Co., 219 U.S. 24 (1910).................................................................8,29,34,35 Twin State CCS Corp. v. Roberts, 72 N.Y.2d 897 (1988)....................................................................13,18 Universities Research Ass’n. v. Coutu, 450 U.S. 754 (1981)............................................................................30 United States v. Olympic Marine Services, Inc., 827 F.Supp. 1232 (E.D.Va. 1993).......................................................29 Winters v. City of Duluth, 84 N.W. 788 (1901).............................................................................12 State Constitution N.Y. State Const., art. I, § 17........................................................................16 New York State Statutes N.Y. Lab. Law § 220..............................................................................passim N.Y. Lab. Law § 220(3)(a)............................................................................17 N.Y. Lab. Law § 220(3)(c)........................................................................1,4,5 N.Y. Lab. Law § 220-g..................................................................................32 N.Y. Nav. Law § 2(6)(a)..................................................................................3 N.Y. Nav. Law § 54......................................................................................3,8 PAGE -vii- N.Y. Nav. Law § 55(1)....................................................................................4 N.Y. Nav. Law § 61(1)....................................................................................4 State Fin. Law § 137.................................................................................31,32 Other State Statutes Maryland State Finance and Procurement Code § 17-201 ..........................14 Missouri Rev. Stat. § 290.210(7) .................................................................15 United States Code 40 U.S.C. § 3131......................................................................................29,31 40 U.S.C. § 3142........................................................................................1,29 Code of Federal Regulations 29 C.F.R. § 5.2(1)(3).....................................................................................33 29 C.F.R. § 5.2(1)(1)................................................................................33,36 46 C.F.R. pt. 338 § 4(f)............................................................................29,35 Other New York State Authorities New York City Dep’t of Transp., Ferries & Buses, Staten Island Ferry, available at http://www.nyc.gov/html/dot/html/ferrybus/statfery.shtml............................8 PAGE -viii- Press Release, Majority Press, New York State Senate Passed the Domestic Workers Bill of Rights quoting State Senator Diane J. Sevino (June 2, 2010), available at http://www.nysenate.gov/press-release/senate- passes-historic-bill-protect-domestic- workers................................................................................................30 Thirteenth Annual Report of the Bureau of Statistics of Labor of the State of New York for the Year 1895, 1896 NY Legis. Doc. No. 73, at pp. 387-388................................................................................................39 Memorandum from Robert Gollnick, Deputy Commissioner of Labor, State of New York Department of Labor, to John Hudacs, Commissioner of Labor State of New York Department of Labor, May 25, 1994 ……..............................................................................42 Other State Authorities 1979-1980 Mich. Op. Atty. Gen. 726 OAG No. 5696, 1980 WL 113842.........................................................................................2,15,36 Other Federal Authorities Amendments to Federal Contract Labor Laws by the Federal Acquisition Streamlining Act of 1994, 61 Fed. Reg. 40714 (1996)..................................................................29 Opinion of the Attorney General, 38 U.S. Op. Att’y. Gen. 418 (Mar. 6, 1936).......................................29 Opinion of the Comptroller General, 17 Comp. Gen. 585 (Jan. 21, 1938)....................................................29 United States Dep’t of Labor Field Operations Handbook.......................................................................................29,35 U.S. 69th Congress, 2nd Session (1927), Hearings before the Committee on Labor, House of Representatives, 31 January, Government Printing Office, Washington, D.C. at p. 2.........................................................38 PAGE -ix- Other Authorities Republicans Get Grip on Convention, N.Y. TIMES, November 4, 1937, available at http://query.nytimes.com/mem/archive/pdf?res=F00913FC3859177A93C6 A9178AD95F438385F9................................................................................16 10% Pay Rise Asked for City Employees, N.Y. TIMES, Jan. 19, 1943, available at http://query.nytimes.com/mem/archive/pdf?res=9C00EEDC1F31E53BBC4 152DFB7668388659EDE.............................................................................17 https://fortress.wa.gov/lni/wagelookup/prvWagelookup.aspx.....................28 1 INTRODUCTION Defendants-Respondents, in their brief in opposition, make several arguments in support of their position that the work they performed – reconstruction and repair of publically owned and publically operated vessels of the City of New York, done pursuant to contracts with various municipal agencies of the City of New York – does not constitute “public work” falling within the ambit of Labor Law § 220. Namely, Defendants-Respondents argue: 1) that the work they performed was not “construction” work; 2) that Labor Law § 220 is fundamentally different from the Federal Davis-Bacon Act (40 U.S.C. § 3142) and that authority interpreting the Davis-Bacon Act should not be used to interpret Labor Law § 220; 3) that no prior authority in New York, with the exception of a nisi prius court’s decision in Falk v. Gerosa, 138 N.Y.S.2d 425 (Sup.Ct.N.Y.Co. 1954), exists requiring the payment of prevailing wages to workers performing vessel repair under publically financed contracts; and 4) that public policy dictates that the work not be deemed “public work” requiring payment of prevailing wages. None of these arguments are in any way meritorious. As will be set forth in detail below, shipbuilding constitutes “construction” as a matter of New York statutory law. The fact that Defendant-Respondent Caddell Dry Dock & Repair Co., Inc. (“Caddell”) was not engaged in the new construction of vessels, but rather their repair and reconstruction, is immaterial, as Labor Law § 220-3(c) specifically 2 requires payment of prevailing wages not just on the construction of public works, but also on their reconstruction and repair. The fact that this issue is one of first impression in the appellate courts of this state in no way impacts determination of whether public vessel repair constitutes “public work.” Given that authority from sister states on this issue is virtually non-existent – indeed, Defendants-Respondents cite to no authority whatsoever, other than a single 1980 opinion letter of the Attorney General of the State of Michigan, holding that vessel repair is not public work – the Federal authority interpreting vessel repair as constituting “public work” requiring payment of prevailing wages (Defs.-Resp’t’s Br. in Opp’n, pp. 43-44), and the United States Supreme Court’s analysis of why vessel repair should constitute “public work,” is certainly instructive. This is particularly true given that the policy purposes of both the Davis-Bacon Act and Labor Law § 220, along with their legislative histories, suggest that their objectives and the harms these statutes seek to redress are substantially identical. Finally, contrary to Defendants-Respondents’ argument, public policy dictates heavily in favor of a finding that the work at issue constitutes “public work” requiring payment of prevailing wages. As such, the determination of the Appellate Division should be reversed. 3 ARGUMENT Point I: Defendants-Respondents’ Argument in Opposition Fundamentally Misinterprets the Nature of Prevailing Wage Laws Defendants-Respondents repeatedly argue that the vessel repair at issue cannot constitute public work as it does not involve “construction,” and that public work must necessarily be “fixed.” Neither contention has merit. A. The work at issue involved the “repair” of vessels, which are “construction” projects under New York law. New York law explicitly states that vessels are “constructed,” and that ship building thus constitutes “construction.” New York Navigation Law § 54 states: “All public vessels shall be so constructed that inflammable material about any machinery or apparatus involving danger of fire where such inflammable material is exposed to ignition, shall be shielded by some incombustible material so that the air may circulate freely between such material and the ignitable substances.” (Emphasis added.) The definition of the term “public vessels” would include the vessels at issue here, such as the Staten Island Ferry, since the Ferry is used for carrying passengers as a means of public accommodation. See N.Y. Nav. Law § 2(6)(a). 4 Like a public building – and unlike a true commodity such as a police car or piece of furniture – public vessels share physical characteristics typically found in buildings such as stairs and passageways which must be constructed: Every public vessel certified to carry passengers shall be provided with (a) permanent stairways and other sufficient and safe means convenient for passing from one deck to the other, and (b) passageways large enough to allow persons freely to pass, which shall be open fore and aft of the length of the vessel, and to and along the railings, which shall be functional, unobstructed and passable whenever the vessel is engaged in carrying passengers. N.Y. Nav. Law § 55(1). Similarly, New York Law explicitly states that repairs to vessels constitute “repairs to a structure.”: “Before any repair or modification is made to the structure or engineering plant of a public vessel… the owner shall notify the inspector of the repair or modification or proposed repair or modification in writing.” See New York Navigation Law § 61(1) (emphasis added). Defendants-Respondents’ repeated attempt to state that the contracts at issue did not require “construction” ignores the plain language of Labor Law § 220, which requires that prevailing wages be paid on all projects for the renovation and repair of public works, as well as their construction. See N.Y. Lab. Law § 220(3)(c) (“The term ‘contract’ as used in this article also shall include reconstruction and repair of any such public work.”) (emphasis added). It thus 5 cannot be disputed that “[t]he ‘repair’ of a public work is a public work.” Sewer Envtl. Contractors, Inc. v. Goldin, 469 N.Y.S.2d 339 (1st Dept. 1983). Defendants-Respondents even go so far as to misrepresent the testimony of Plaintiffs’ expert witness Tom Nodell claiming that Mr. Nodell testified that the contracts at issue do not call for “construction,” and that the Comptroller’s office has never enforced the payment of prevailing wages on vessel repair projects. See Defs.-Resp’t’s Br. in Opp’n, pp. 4, 31. To be sure, Mr. Nodell testified that the contracts at issue did not involve new construction. (See R. 2216) (“We’re not building a boat”); (R. 2219) (“I would say that this is not new construction” (emphasis added)); (R. 2202) (“it’s not new construction.”). However, as Labor Law § 220(3)(c) makes clear, a contract need not require new construction in order to require payment of prevailing wages. The statute contemplates that “repair” to public works requires payment of prevailing wages just as much as the construction of public works.1 1 The contracts at issue here unequivocally called for reconstruction and repair of public vessels. (See, e.g. R. 181) (contract for “Drydocking, Inspection and Related Repairs to the Department of Transportation Ferry Vessels, the ‘Andrew J. Barberi’ and the ‘Samuel I. Newhouse’” (FE-5693, FC-5576), in the City of New York”) (emphasis added); (see also R. 662) (contract for “Repairs to the Department of Transportation Ferry Vessels of the ‘Austen’ Class”); (R. 944) (contract for repair of sanitation barges); (R. 960) (contract for “reconstruction of Derrick #3” for the Department of Sanitation) (emphasis added); (R. 1039) 6 Mr. Nodell did not recall a situation where his office had investigated a prevailing wage complaint brought by a worker on a vessel repair project during his tenure. However he acknowledged that the Comptroller’s Labor Law Division had a “very small staff and we were reactionary as opposed to being proactive… I would say that 99 percent of the time [we only acted if someone complained].” (R. 2194). What is certain is that the Comptroller’s Office had in fact investigated prevailing wage complaints relating to vessel repair prior to Mr. Nodell’s tenure, and completely failed to abide by a controlling judicial determination directing it to enforce payment of prevailing wages to workers performing public vessel repair. In Falk v. Gerosa, 138 N.Y.S.2d 425 (Sup.Ct.N.Y.Co. 1954), George F. Falk, a worker on a New York City sludge boat had applied to the New York City Comptroller for a determination of his wage rate pursuant to Labor Law § 220. The Comptroller “dismissed the application on the ground that petitioner's duties were not such as were provided for in § 220.” Falk, supra, 128 N.Y.S.2d at 426. Thereafter, Mr. Falk filed an Article 78 proceeding seeking to annul the Comptroller’s determination. The Hon. Justice Edgar J. Nathan granted the petition, finding that the “determination of the respondent [Comptroller] was unreasonable and must therefore be annulled and the matter remitted for further (contract for repair to Department of Transportation vessels); (R. 1156) (contract for repair to Department of Sanitation barges). 7 proceedings.” Id. This determination was never overturned, and was never called into question prior to the Appellate Division’s determination in the instant matter. Accordingly, the Falk court’s determination that workers performing vessel repair remained binding on the Comptroller throughout the period at issue. There is no justification in the record for the Comptroller’s failure to enforce the edict given it by the Falk Court. Clearly, the Caddell workers performing these vessel repairs cannot be faulted for failing to complain to the Comptroller that they were being underpaid, particularly when the Comptroller itself was not enforcing the dictates set down in Falk. Nor does the workers’ inaction imply that they were being paid correctly. See, e.g. Cadwallader v. New York State Dep’t of Labor, 112 A.D.2d 527 (3d Dept. 1985) (acceptance by workers of wages less than the prevailing wage, with signed waivers stating the workers had been paid in full, did not obviate the contractor’s obligation to fully pay prevailing wages). Defendants-Respondents stress that the vessels at issue are “commodities,” the repair of which constitutes “general services” rather than “construction, rebuilding, or repair” as defined in Labor Law § 220. See Defs.-Resp’t’s Br. in Opp’n, at p. 27. However, Defendants-Respondents make this argument without any citation to authority that repair of publically owned and operated vessels is a “commodity.” Indeed, this argument ignores the fundamental nature of vessels as 8 opposed to, for example, automobiles or desks, which are usually thought of as “commodities.” Each of the Staten Island Ferry vessels holds over a thousand people, and contains “sinks, faucets [and] toilets,”2 While Defendants-Respondents claim that the legislature’s failure to “include vessels within the examples of ‘public work’” “speaks volumes about the Legislature’s intent,” (see Defs.-Resp’t’s Br. in Opp’n, at p. 24), the list of as well as seating areas, corridors, stairwells, and extensive electrical, HVAC (heating, ventilation, and air conditioning), and plumbing systems. These are all physical characteristics of public buildings, rather than commodities such as a fire engine, desk, or pencil sharpener. The fact that New York statutes consider shipbuilding to be “construction” (see N.Y. Nav. Law § 54), and the United States Supreme Court considers shipbuilding to be “public work” (see Title Guar. & Trust Co. v. Crane Co., 219 U.S. 24, 33 (1910)), along with the fact that some of the contracts at issue specifically state that the projects are “public works Project[s] on which each worker is entitled to receive the prevailing wages and supplements for the occupation at which he or she is working,” (see, e.g. R. 287) belies Defendants- Respondents unsupported allegation that these are “general services” contracts for “the maintenance of commodities.” See Defs.-Resp’t’s Br. in Opp’n, at p. 12. 2 See New York City Dep’t of Transp., Ferries & Buses, Staten Island Ferry, available at http://www.nyc.gov/html/dot/html/ferrybus /statfery.shtml. 9 construction trades included in the non-exhaustive listing of construction categories contained in the ancillary sections of Labor Law § 220 by no means includes every type of “public work” for which prevailing wages must be paid. See, e.g. Brang Co., Inc. v. State Univ. Constr. Fund, 47 A.D.2d 178 (3d Dept. 1965) (tree planting); Long Island Lighting Co. v. Indus. Comm’r, 40 A.D.2d 1003 (2d Dept. 1972) (street light installation). Many types of “public work” are simply subject to infrequent litigation, and as such, the legislature’s failure to mention them by name in Labor Law § 220 is more a reflection of the statute’s non- exhaustive nature than any specific intention on the part of the legislature to limit Labor Law § 220’s scope. After the Falk decision in 1954, more than thirty years passed before any court mentioned payment of prevailing wages on vessels. See Thaxter v. City of New York, 704 F.Supp. 531 (S.D.N.Y. 1989) (“Chief Marine Engineer[s] on sludge vessels operated by the City,” were “‘Section 220’ or ‘prevailing rate’ employees”); Harding v. City of New York, 1988 WL 56729 (S.D.N.Y. May 20, 1988) (Connor, D.J.) (same). No court addressed the issue again until the instant action was filed 13 years later. Because vessel repair represents a minute fraction of all publicly-financed building construction, repair and renovation performed in New York, it is reasonable to conclude that actions, both civil and administrative, involving the applicability of prevailing wage laws to vessel repair will rarely arise. Perhaps this 10 explains why the body of law on the vessel repair issue is so sparse when compared to prevailing wage cases as a whole. It may also explain why vessel repair is not specifically referenced in the Labor Law, since the list of construction trades given as examples in Labor Law § 220 is far from exhaustive. For example, Labor Law § 220 also fails to specifically include sign painting or street light installation, which are clearly subject to payment of prevailing wages. See Miele v. Joseph, 280 A.D. 408 (1st Dept. 1952), aff’d 305 N.Y. 667 (1953); Long Island Lighting Co. v. Indus. Comm’r, 40 A.D.2d 1003 (2d Dept. 1972) (“The contracts with petitioner had undoubtedly for their purpose the construction of fixtures for a public object. In this sense they carried out public work, for it is function which marks the public nature of the contracts”). The trades set forth in the various ancillary sections of Labor Law § 220 are, thus, in no way exhaustive of those governed by New York’s prevailing wage laws, and should not be deemed to exclude any work not delineated. Accordingly, Defendants-Respondents’ argument that vessel repair does not constitute “construction,” and thus cannot be considered “public work,” is meritless. B. Projects need not be “fixed” to constitute “public works.” Defendants-Respondents cite a legion of decisions from other states and statutes of other states which they contend support the proposition that vessel repair cannot constitute “public work” as it is not “fixed.” See Defs.-Resp’t’s Br. in 11 Opp’n, at pp. 42-45. However, almost none of the authority cited to by Defendants- Respondents for their proposition that “numerous states considering the scope of term ‘public works’ have limited its definition to ‘fixed’ works” actually supports that proposition See Defendents-Respondents’ Brief in Opposition, at p. 43. Initially, it must be noted that Defendants-Respondents repeatedly cite to this Court’s holding in People v. Crane, 214 N.Y. 154, 188 (1915) for the proposition that public works are “fixed works for public use.” See Defs.-Resp’t’s Br. in Opp’n, at pp. 12, 17, 23. However, that definition comes only in the dissent to this Court’s majority opinion, which contains no such definition. Likewise, Bessemer Water Serv. v. Lake Cyrus Dev. Co., 949 So.2d 643 (Ala. 2006) nowhere mentions the word “fixed.” Rather, the Bessemer court cited to Alabama’s public bidding statute, which states: “The construction, repair, renovation, or maintenance of public buildings, structures, sewers, waterworks, roads, bridges, docks, underpasses, and viaducts as well as any other improvement to be constructed, repaired, renovated, or maintained on public property and to be paid, in whole or in part, with public funds…” Id., 949 So.2d at 650 (emphasis in original). Under that definition, the work at issue here would clearly constitute “public work,” as vessel repair constitutes the “construction, repair, renovation, or maintenance of public… structures.” 12 Similarly, Carson-Tahoe Hosp. v. Bldg. & Constr. Trades Council, 128 P.3d 1065 (Nev. 2006) does not mention the word “fixed,” and finds only that prevailing wages did not have to be paid on a project which was purely a private construction project, funded through public economic development bonds, for which no public funds were expended. Lee v. Lynn, 111 N.E. 700 (Mass. 1916) contains no mention of the word “fixed” at all, and indeed references no definition of the term “public work” whatsoever – it merely held that Massachusetts’ prevailing wage law was constitutional. Mercer County v. Wolff, 86 N.E. 708 (Ill. 1908) makes no mention of the word “fixed,” contains no definition of the term “public work,” and holds only that “[t]he erection of a common jail is a public work.” Demeter Land Co. v. Florida Pub. Serv. Co., 128 So. 402 (Fla. 1930), included a definition of the term “public works” which used the word “fixed.” However, at issue in that case was the propriety of a condemnation proceeding to obtain an easement for public utility lines. Whether the project was “fixed” or not was of no moment to the decision. Similarly, Southern Surety Co. v. Standard Slag Co., 159 N.E. 559 (Ohio 1927) (regarding a road building project); State v. A. H. Read Co., 240 P. 208 (Wyo. 1925) (regarding a street paving project); Winters v. City of Duluth, 84 N.W. 788 (Minn. 1901) (regarding a public pumping station); Opportunity Center of Southeastern Illinois, Inc. v. E. Allen Bernardi, 562 N.E.2d 13 1053 (Ill. App. Ct. 1990) (regarding building remodeling services); Raley v. California Tahoe Reg’l Planning Agency, 68 Cal. App. 3d 965 (Cal. Ct. App. 1977) (regarding highway alteration); and Overstreet v. Houston County, 365 S.W.2d 409 (Tex. Civ. App. 1963) (regarding installation of a central air conditioning system in a county courthouse) each determined that a project was a prevailing wage project, and, in so doing, made mention of definitions of the term “public work” which used the word fixed. However, in all of these decisions, the work at issue was a “fixed” work. As such, the word “fixed” was immaterial to each of their holdings, and in no way do they support Defendants-Respondents’ argument that repair and renovation projects which are not “fixed” cannot be “public works.” One case cited by Defendants-Respondents, Safari Circuits, Inc. v. Chicago Sch. Reform Bd. of Tr., 474 F.Supp.2d 993 (N.D.Ill. 2007) did hold that the work at issue – installation of audio/visual equipment in school buildings – was not “public work” because it was not “fixed.” However, the Safari court specifically cited to two New York decisions, including one from this Court, which held to the contrary, finding that such work is public work: Twin State CCS Corp. v. Roberts, 528 N.E.2d 1219 (1988); and Joint Indus. Bd. of the Elec. Indus. v. Koch, 452 N.Y.S.2d 488, 490 (N.Y. Sup. Ct. 1982). The Safari Court rested its holding on the fact that the work at issue there “was not ‘construction’ type work.” 474 F.Supp.2d 14 at 1000. The Safari Court included a definition of “public work” which would, in fact, encompass the work at issue here: “contracts for ‘public work’… cover only contracts for ‘fixed works,’ ‘construction-oriented’ projects or work ‘akin to building contracts.’” Id. (emphasis added). The work that Plaintiffs here performed – cutting, burning, and welding metal; “work[ing] with wood [and performing] interior joinery;” performing electrical work; painting ships; sand blasting; and pipefitting (R 1709-1712) – is clearly “akin to building contracts.” Id. Defendants-Respondents similarly cite to Maryland State Finance and Procurement Code § 17-201 for their argument that the term “public works” has been limited to “fixed works.” However, nowhere in that statute is the word “fixed” used. Rather, it refers to a definition of “public work” which includes “a structure or work, including a bridge, building, ditch, road, alley, waterwork, or sewage disposal plant, that: (i) is constructed for public use or benefit; or (ii) is paid for wholly or partly by public money.” Md. State Finance and Procurement Code Ann. § 17-201. Under that definition, New York law would clearly hold shipbuilding and ship repair of public vessels to be “public work” because: (i) public funds wholly paid for the contracts at issue; (ii) the vessels at issue are for public use and benefit; and (iii) New York courts have held that ships in dry-dock constitute “structures” under the Labor Law. See Chaffee v. Erie R.R. Co., 68 A.D. 15 578 (4th Dept. 1902), cited with approval by this Court in Caddy v. Interborough Rapid Transit Co., 195 N.Y. 415 (1909). Missouri Revised Statute § 290.210(7) does, in fact, define “public works” as “all fixed works constructed for public use or benefit or paid for wholly or in part out of public funds.” Mo. Rev. Stat. § 290.210(7). However, no published decisions have ever cited to this definition in the context of shipbuilding or vessel repair, and – of course most crucially – no such definition appears in New York law. In sum, despite representations to the contrary, Defendants-Respondents fail to provide any authority standing for the proposition that shipbuilding or vessel repair does not constitute “public work”, and that the public work must be “fixed,” with only one exception. Their sole “authority” for this position is a single 1980 Opinion Letter of the Michigan Attorney General. However, as thoroughly discussed in Plaintiffs-Appellants original brief, this Opinion Letter is based on erroneous interpretations of the legal authority it cites to, and it is respectfully requested that this Court give that Opinion Letter no weight. See Pls.-Appellants’ Br. in Supp., at pp. 22-25. Defendants-Respondents’ argument that no New York Court, aside from the New York County Supreme Court in Falk v. Gerosa, 138 N.Y.S.2d 425 (Sup.Ct.N.Y.Co. 1954), has ever held that vessel repair constitutes “public work” 16 is of no moment. See Defs.-Resp’t’s Br. in Opp’n, at pp. 15-17. Prior to the instant action, no New York court had ever addressed the issue of whether vessel repair constituted “public work” requiring payment of prevailing wages, aside from the Falk court, which ruled favorably for the affected workers. Significantly, the Supreme Court Justice who decided Falk, the Hon. Edgar J. Nathan, was a member of the 1937-1938 Constitutional Convention which passed Article 1, § 17 of the Constitution, the New York Constitutional provision that guarantees payment of prevailing wages on public works.3 3Republicans Get Grip on Convention, N.Y. TIMES, November 4, 1937, available at http://query.nytimes.com/mem/archive/pdf?res=F00913FC3859177A93C6A9178 AD95F438385F9. Because Justice Nathan had intimate knowledge of the passing of this provision, it is presumed he believed his decision in Falk to be in accordance with the intent of Article 1, § 17 of the New York Constitution. While the Appellate Division in this case rejected the reasoning of Judge Nathan’s decision, the Court below cited extensively to the 1938 Constitutional Convention floor minutes regarding this Constitutional provision in its holding. (See R 3770). It is respectfully submitted that Justice Nathan, having been a member of the Constitutional Convention, was better positioned to analyze the application of the Constitutional Convention’s intent to interpret vessel repair as “public work” than was the Appellate Division in this 17 case, fifty eight years later. Further, as Justice Nathan had been Manhattan Borough President during World War II,4 Defendants-Respondents further stress that no court had previously ordered the payment of prevailing wages “for work on a project that was not fixed to land,” and Plaintiffs-Appellants are aware of only one prior case where this Court addressed the issue of payment of prevailing wages to workers who were working on projects which were not “fixed to land.” See Don v. Joseph, 1 N.Y.2d 708 (1956) (this Court affirmed the holding of the First Department Appellate Division that “carriage upholsterers” were entitled to be paid prevailing wages under Labor Law § 220). However, the fact that this matter is one of first impression has no bearing on the validity of Plaintiffs-Appellants’ claims. it can be presumed that he had extensive experience with public contracting. Finally, Defendants-Respondents acknowledge that Labor Law § 220(3)(a) requires that workers on public works projects be paid “not less than the prevailing rate for a day's work in the same trade or occupation in the locality within the state where such public work on, about or in connection with which such labor is performed in its final or completed form is to be situated, erected or used.” See 4 10% Pay Rise Asked for City Employees, N.Y. TIMES, Jan. 19, 1943, available at http://query.nytimes.com/mem/archive/pdf?res=9C00EEDC1F31E53BBC4152DF B7668388659EDE. 18 Defendants-Respondents Brief in Opposition, at pp. 29-30 (emphasis added). Defendants-Respondents attempt to explain this language – which clearly implies that a project need be neither “situated” nor “erected” in order to constitute a public works project – by stating that “fixed structures can be moved from [w]here they are ‘erected’ and fixed again.” See Defs.-Resp’t’s Br. in Opp’n, at p. 30. Of course, any structure capable of such use would necessarily not be “fixed” – but, by Defendants-Respondents’ own admission, construction work performed on such a structure would constitute “public work.” Clearly, there is no legal or logical argument for asserting that “public work” must necessarily be fixed. As this Court has held, “[i]n determining whether a particular project constitutes a ‘public work’, the inquiry focuses on ‘the purpose or function of the project.’” See Twin States CCS Corp. v. Roberts, 72 N.Y.2d 897, 899 (1988). Clearly, the purpose and function of performing reconstruction and repair of publically owned vessels has, as its main purpose, the benefit of the public. The funds used for these repairs are solely public funds; the work is performed pursuant to contracts with public agencies; and the work performed on the projects consists of trade work consistent with that typically used on public buildings (R 2227-2229). As such, the work at issue was “public work.” 19 POINT II: THE TREATMENT OF PREVAILING WAGES BY THE CONTRACTING AGENCIES AND COMPTROLLER’S OFFICE ARE IRRELEVENT TO THE DETERMINATION OF WHETHER THE WORK AT ISSUE CONSTITUTES “PUBLIC WORK” REQUIRING PAYMENT OF PREVAILING WAGES On or about June 23, 2003, in response to a letter from Caddell’s counsel (R. 99-101), B. Dean Angelakos of the Office of the Comptroller issued a statement that “it is our opinion that the prevailing wage laws do not apply to the dry-dock and ship-repair work your client Caddell Dry Dock & Repair Co. will perform for the City of New York.” (R. 102-103). Similarly, in depositions taken in the course of proceedings in this action, various Agency Chief Contracting Officers (“ACCO”’s) for the Contracting Agencies stated their opinions that the work performed by Caddell pursuant to the Public Works Contracts did not constitute “public works” requiring the payment of prevailing wage and supplemental benefit rates (see generally R. 2462-3129). As a matter of firmly established law, the determination of the Comptroller and the opinions of the ACCO’s are irrelevant to Plaintiffs’ common-law contractual claims. Nevertheless, they are both incorrect and unavailing. 20 A: The Comptroller’s determination is both incorrect and irrelevant to Plaintiffs-Appellants’ claims Initially, with respect to B. Dean Angelakos’s June 23, 2003 letter,5 5 Mr. Angelakos, an appointed former official with the New York City Comptroller’s office, is not an attorney. Nevertheless, he interpreted case law – specifically, Erie County Indus. Dev. Agency v. Roberts, 94 A.D.2d 532 (4th Dept. 1983) aff’d 63 N.Y.2d 810 (1984), a case involving the applicability of prevailing wage requirements to a private construction project on a privately-owned printing factory – in making his incorrect determination. More importantly, he inexplicably failed to reference the dictates set down in Falk, much less attempt to distinguish the facts in Falk to those in this action. Indeed, pursuant to Falk, the Comptroller did not have the authority to find that vessel repair did not constitute “public work” requiring payment of prevailing wages. The Comptroller did not appear to review the contracts at issue in this action, nor did it invite comment from interested parties, such as trade unions or Plaintiffs-Appellants’ counsel. No public hearing was held, and the determination was based solely upon representations made by Caddell’s counsel. (R. 23-24). the First Department Appellate Division, on both a prior appeal and below, specifically reviewed this determination and its effect upon Plaintiffs’ claims herein, and rejected its relevancy to Plaintiffs’ common-law breach of contract claims. Noting that, in response to communication from Caddell’s counsel, the “Comptroller responded that the prevailing statutory wage laws (N.Y. Lab. Law § 220 et seq.) did not apply to the type of work Caddell described,” (De La Cruz v. Caddell Dry Dock and Repair Co., 22 A.D.3d 404, 405 (1st Dept. 2005)), the First Department nevertheless found that “the Comptroller’s determination, based on the Labor Law, is irrelevant to Plaintiffs’ common-law contractual claim,” and that Plaintiffs were entitled to recover “even in the absence of a Labor Law violation.” Id. The 21 Appellate Division, despite having the Comptroller’s opinion letter before it on the decision being appealed from here, made no mention of the Comptroller’s determination. As such, the decision appealed from does not rely upon the Comptroller’s letter. It is clear that courts are not required to give any deference to a Comptroller’s determination in deciding whether a particular project constitutes “public work” requiring payment of prevailing wages. The determination of the New York City Comptroller or NYS Department of Labor regarding the applicability of prevailing wage laws to a particular project “is one of pure statutory construction such that [courts] are not required to give deference to [the agency’s] interpretation.” Stephens and Rankin, Inc. v. Hartnett, 160 A.D.2d 1201 (3d Dept. 1990). “The issue of what is a public works [sic] is viewed as essentially one of statutory reading and analysis.” Matter of National R.R. Passenger Corp. v. Hartnett, 572 N.Y.S.2d 386, 388 (3d Dept. 1991); see also Matter of Erie County Indus. Dev. Agency v. Roberts, 465 N.Y.S.2d 301, 307 (4th Dept. 1983), aff’d, 63 N.Y.2d 810 (1984). B: The ACCO’s statements are both irrelevant and inaccurate At their depositions, the ACCO’s for the New York City Department of Transportation, Department of Sanitation, and Fire Department all testified as to their belief that prevailing wage laws did not apply to the work performed by 22 Caddell. (See generally R. 2462-3129). However, the opinions of the ACCO’s are of no moment. Nowhere in Labor Law § 220 are contracting agencies such as those here given any authority to interpret or opine upon the applicability or inapplicability of prevailing wage requirements to any particular contract. At least one court has specifically addressed a similar instance of contracting agency’s insistence on the non-applicability of prevailing wage requirements, and nevertheless upheld the requirement to pay prevailing wages and supplemental benefits, under strikingly similar circumstances. In Sewer Envtl. Contractors, Inc. v. Goldin, 98 A.D.2d 606 (1st Dept. 1983), the contractor was awarded several contracts “by the New York City Department of Environmental Protection for the removal and disposal of sewer deposits.” Id. at 606. There, as here, the contracts “required that the wages paid must comply with the ‘prevailing rate of wage’ as defined in Labor Law § 220.” Id. The contractor “had been apprised by various agency officials in both this and prior instances that section 220 did not apply to sewer cleaning contracts. When it sought an opinion from the Comptroller's office on the question, no response was forthcoming.” Id. at 606-607.6 6 Here, unlike in Sewer Envtl. Contractors, Caddell did not request an opinion from the Comptroller until after this suit was brought. Indeed, Caddell’s President testified that Caddell took no affirmative steps whatsoever to have the Contracts revised to remove the contractual language requiring payment of Prevailing Wages (R. 1720). The First 23 Department, in finding that the contractor was nevertheless required to pay prevailing wages and supplemental benefits to its workers, recognized both that the “contracts required that the wages paid must comply with the ‘prevailing rate of wage’ as defined in Labor Law § 220” and that “the ‘repair’ of a public work is a public work. See Labor Law § 220[3]. The test to be applied in determining what is a public work is function rather than magnitude.” Id. at 606. Here, as in Sewer Envtl. Contractors, the Contracting Agencies, through their various ACCO’s, have stated their belief that prevailing wages are not required to be paid to Plaintiffs-Appellants. Nevertheless, Caddell entered into contracts requiring the payment of prevailing wages, for the repair of a publicly owned structure. A similar situation was addressed by the Third Department Appellate Division in Brang Co., Inc. v. State Univ. Constr. Fund, 47 A.D.2d 178 (3d Dept. 1965), where the court upheld the requirement that the contractor – who had entered into a contract for a “tree planting project at the State University College of Forestry at Syracuse … provid[ing] that the wages to be paid by [the contractor] ‘shall be not less than the prevailing rate of wages as defined by law’” – was required to pay prevailing wages to its workers. Despite the fact that the contracting agency failed to annex a prevailing wage schedule to the contract, the 24 Third Department upheld Brang Co.’s obligation to pay prevailing wages to its workers under Section 220 of the Labor Law, noting: Here, the statutory scheme [requiring payment of prevailing wages] was, apparently, completely ignored by both parties before any contract was executed… Insofar as defendant's neglect to perform its obligation [to annex a prevailing wage schedule to the contract] is concerned, we note that plaintiff failed to object thereto before signing a contract flatly promising to pay the prevailing rate of wages. Id. at 179-180. Similarly, in Joint Indus. Bd. of the Elec. Indus. v. Koch, 452 N.Y.S.2d 488 (Sup.Ct.N.Y.Co. 1982), the Court refused to accord any weight to either the contracting agencies’ or the Comptroller’s office’s determination that prevailing wage laws did not apply to the contracts at issue. There, an electrical contractor, Northern Telecom, Inc., “was advised by the city prior to entering into the contracts that the ‘prevailing rate of wage’ provision was inapplicable.” Id. at 490. In response to that proceeding, the City submitted an affidavit from the Comptroller’s office “which state[d] that section 220 of the Labor Law is inapplicable to these contracts.” Id. at 491. Nevertheless, the Court granted petitioner’s application for a writ of mandamus forcing the City to require payment of prevailing wages and supplemental benefits upon the contracts at issue. Recognizing that the “term ‘public works’ is not synonymous with public contracts but the courts have given a liberal interpretation to the term,” the Court accorded 25 no weight to the opinions of the Comptroller or the contracting agencies. Id. at 490. Instead, the Court found that Labor Law § 220 did apply to the projects at issue, as “extensive construction-type labor is involved in the installation of… ‘a permanent improvement to the structure.’” Id. As such, it is clear that the determination of whether the work at issue constitutes “public work” requiring the payment of prevailing wages is one that rests with this Court, and that the determinations of the various New York City agencies to the contrary are of no moment. C. Plaintiffs-Appellants’ Claims are not Barred by Estoppel Defendants-Respondents make an attempt to argue that, based upon the past practice of the city in neglecting to enforce payment of prevailing wage provisions, the city would be estopped from attempting to enforce those provisions now. See Defs.-Resp’t’s Br. in Opp’n, at pp. 33-34. Defendants-Respondents further argue that, as third-party beneficiaries of the contracts between Caddell and the various city agencies, Plaintiffs-Appellants should similarly be estopped from arguing that the work they performed constituted public work requiring payment of prevailing wages. This argument is patently meritless. Defendants-Respondents cite to the case of McManus v. Bd. of Educ., 87 N.Y.2d 183, 187 (1995) for the proposition that a municipal division may, by its conduct, be estopped from changing positions. However, what this argument fails 26 to recognize is that the determination of whether something constitutes a public work requiring payment of prevailing wages is a determination which, in the end, is one to be made judicially, rather than by an executive branch authority. See, e.g. Matter of Erie County Indus. Dev. Agency v. Roberts, 465 N.Y.S.2d 301, 307 (4th Dept. 1983), aff’d, 63 N.Y.2d 810 (1984); Matter of Nat’l R.R. Passenger Corp. v. Hartnett, 572 N.Y.S.2d 386, 388 (3d Dept. 1991); Stephens and Rankin, Inc. v. Hartnett, 160 A.D.2d 1201 (3d Dept. 1990); Sewer Envtl. Contractors, Inc. v. Goldin, 98 A.D.2d 606 (1st Dept. 1983); Brang Co., Inc. v. State Univ. Constr. Fund, 47 A.D.2d 178 (3d Dept. 1965); Joint Indus. Bd. of the Elec. Indus. v. Koch, 452 N.Y.S.2d 488 (Sup.Ct.N.Y.Co. 1982). Further, as in Sewer Envt’l Contractors, Inc. v. Goldin, 98 A.D.2d 606 (1st Dept. 1983) and Brang Co., Inc. v. State Univ. Constr. Fund, 47 A.D.2d 178 (3rd Dept. 1965), Caddell here signed, without protest, a contract flatly promising to pay prevailing wages. In fact, Caddell signed many such contracts. As in those cases, the fact that neither the Comptroller nor the contracting agencies sought to enforce those provisions of the contracts does not mean that those provisions cannot be enforced. This is especially true where, as here, Caddell continued to enter into contracts for decades, never having taken any steps to seek clarification or removal of the prevailing wage provisions during the bidding process when 27 clarifying pre-bid contract addendums could have been issued by the contracting agencies. (See R. 1720). Finally, Defendants-Respondents’ insistence that Plaintiffs-Appellants should be estopped from asserting that they are owed prevailing wages based upon their previous acceptance of wage payments at less than the prevailing rate of wages is clearly unavailing. As a matter of public policy, if prevailing wages are required to be paid on a project, they must be paid. If workers were free to waive their rights to receive prevailing wages, contractors could avoid the entire statutory scheme to pay prevailing wages merely by seeking out workers willing to work for less, and obtaining waivers or releases from those workers, thus allowing them to avoid the competitive bidding procedures and undercut contractors who pay proper wages. This precise scheme was rejected by the Appellate Division in Cadwallader v. New York State Dep’t of Labor, 112 A.D.2d 527 (3d Dept. 1985), and it should be rejected by this Court. PART III: FEDERAL AUTHORITY INTERPRETING THE DAVIS-BACON ACT AND MILLER ACT, WHILE NOT CONTROLLING, IS INSTRUCTIVE Defendants-Respondents allege that “Plaintiffs concede that federal and New York laws on prevailing wages are ‘not identical’… and they offer no reason why this Court should disregard New York law or prefer a federal interpretation of 28 ‘public work’ over that of the courts of this State.” See Defs.-Resp’t’s Br. in Opp’n, at p. 35. This argument fails simply because there is no New York authority on the issue of whether vessel repair constitutes “public work” requiring payment of prevailing wages, aside from Falk v. Gerosa, 138 N.Y.S.2d 425 (Sup.Ct.N.Y.Co. 1954). Similarly, there is scant authority from sister states addressing the issue of whether, under their prevailing wage laws, shipbuilding and vessel repair constitutes “public work” requiring the payment of prevailing wages. The State of Washington considers “Shipbuilding & Ship Repair” to be public work requiring payment of prevailing wages, and the State of Washington Department of Labor & Industries Prevailing Wage Section has promulgated prevailing wage rates for Ship Repair trades such as Carpenters, Electricians, Boilermakers, Pipefitters, Sandblasters, Machinists, and Sheet Metal workers upon Ship Repair projects.7 7 See State of Washington prevailing wage rates available at https://fortress.wa.gov/lni/wagelookup/prvWagelookup.aspx, under trade “Shipbuilding and Ship Repair.” As addressed above, the Michigan Attorney General has stated that prevailing wages need not be paid on shipbuilding projects. Neither Plaintiffs-Appellants nor Defendants-Respondents have been able to cite to any other sister states which have determined the issue. 29 Conversely, the Federal authority determining that shipbuilding and ship repair constitute “public work” under the Davis-Bacon Act (40 U.S.C. § 3142) and the Miller Act (40 U.S.C. § 3131(b)) is legion. See generally Title Guar. & Trust Co. v. Crane Co., 219 U.S. 24, 33 (1910); United States v. Olympic Marine Services, Inc., 827 F.Supp. 1232 (E.D. Va. 1993); Regal Indus. Corp. v. Crum and Forster, Inc., 2005 PA Super. 425 (Pa. Super. Ct. 2005); 38 Op. Att’y Gen. 418, 422-423; 1936 WL 1683 (U.S.A.G.) (1936) (R. 110-113); U.S. Comptroller General Opinion, 17 Comp. Gen. 585, 586; 1938 WL 568 (1938) (R. 114-116); Amendments to Federal Contract Labor Laws by The Federal Acquisition Streamlining Act of 1994, 61 Fed. Reg. 40714, 40715 (Dep’t of Labor August 5, 1996) (R. 117-120); Procedure for Securing Competitive Bids, 46 C.F.R. Pt. 338 § 4(f); Department of Labor Wage and Hour Division Field Operations Handbook (R. 139). As this authority directly addresses the issue of whether vessel repair constitutes “public work” requiring the payment of prevailing wages, while authority under New York law consists solely of the nisi prius court’s decision in Falk, and the authority of sister states is largely nonexistent, it is respectfully submitted that Federal authority is entirely appropriate. Defendants-Respondents’ argument that the purposes of the Davis-Bacon Act and New York Labor Law § 220 are different, and that authority based upon the Davis-Bacon Act is thus not informative of issues arising under Labor Law § 30 220, ignores the history of both statutes. As the Supreme Court has recognized, the Davis-Bacon Act “was designed to protect local wage standards by preventing contractors from basing their bids on wages lower than those prevailing in the area.” Universities Research Ass’n., v. Coutu, 450 U.S. 754, 773 (1981). This Court has recognized that this is precisely the same goal sought by Labor Law § 220: “Labor Law § 220 implements the constitutional mandate that contractors engaged in public projects pay their workers wages and supplements which ‘shall be not less than the prevailing rate for a day’s work in the same trade or occupation in the locality within the state where such public work… is performed.’” Lantry v. State of New York, 6 N.Y.3d 49, 54 (2005) (quoting N.Y. Lab. Law § 220). While it is clear that the purpose of the Davis-Bacon Act and Labor Law § 220 are the same, Defendants-Respondents would have this Court read an interpretation of Labor Law § 220 which would grant workers fewer protections than are available to them under Federal law. This result would clearly be at odds with the Legislature’s insistence that “New York has long been a leader in protecting the rights of workers. We enacted child labor laws long before the federal government did [and] were the first to pass labor protections for those toiling in sweatshops.” See Press Release, Majority Press, New York State Senate Passed the Domestic Workers Bill of Rights quoting State Senator Diane J. Sevino (June 2, 2010), 31 available at http://www.nysenate.gov/press-release/senate-passes-historic-bill- protect-domestic-workers. Further, Defendants-Respondents’ claim that Plaintiff-Appellants have “failed to highlight any provision of the Prevailing Wage Act [Labor Law § 220] that references the Miller Act” is disingenuous. While Labor Law § 220 does not reference the Federal Miller Act, it does reference New York State Finance Law § 137 – the New York analog of the Miller Act. Specifically, the Miller Act (40 U.S.C. § 3131(b)) provides as follows: Before any contract of more than $ 100,000 is awarded for the construction, alteration, or repair of any public building or public work of the Federal Government, a person must furnish to the Government the following bonds, which become binding when the contract is awarded:…(2) Payment bond. A payment bond with a surety satisfactory to the officer for the protection of all persons supplying labor and material in carrying out the work provided for in the contract for the use of each person. The amount of the payment bond shall equal the total amount payable by the terms of the contract. State Finance Law § 137 similarly requires the provision of a labor and material payment bond on New York public works projects in much the same way as the Miller Act does on Federal public works projects: In addition to other bond or bonds, if any, required by law for the completion of a work specified in a contract for the prosecution of a public improvement for the state of New York a municipal corporation, a public benefit corporation or a commission appointed pursuant to law… shall nevertheless require prior to the approval of any such contract a bond guaranteeing prompt payment of moneys due to all persons furnishing labor or materials to the contractor or any 32 subcontractors in the prosecution of the work provided for in such contract. State Fin. Law § 137. Contrary to Defendants-Respondents’ argument, Labor Law § 220 does indeed refer to the Miller Act’s New York analog, State Finance Law § 137. Labor Law § 220-g specifically provides for a direct private right of action by workers seeking to recover underpayment of prevailing wages upon State Finance Law § 137 bonds: [T]he affected employee may bring an action to recover from the bond which is required by section one hundred thirty-seven of the state finance law, of the contractor, the subcontractor or both, unpaid wages and supplements, including interest as provided for in subdivision eight of section two hundred twenty of this article, due to persons furnishing labor to either the contractor or subcontractor. Said action may be brought against the contractor, the subcontractor, or the issuer of such bond, without prior notice. Defendant-Respondent Caddell obtained such labor and material payment bonds for their contracts from Defendants-Respondents American Automobile Insurance Company and American Manufacturers Mutual Insurance Company. (See, e.g. R 1654-1663). Plaintiffs-Appellants have sued upon these State Finance Law § 137 bonds. As there is no authority interpreting State Finance Law § 137’s application to vessel repair, and only Falk interpreting Labor Law § 220’s application to vessel repair, it is respectfully submitted that the abundant authority assessing the applicability of those statutes’ Federal analogs to vessel repair be considered by the Court. 33 Similarly, Defendants-Respondents’ reliance upon textual differences between the Davis-Bacon Act and Labor Law § 220 is misguided. Defendants- Respondents point out that the Davis-Bacon Act requires payment of prevailing wages upon “public buildings and public works,” while Labor Law § 220 requires payment of prevailing wages “to laborers, workmen or mechanics upon such public works.” See Defs.-Resp’t’s Br. in Opp’n, at p. 39. Defendants-Respondents use this difference to imply that, while the Davis-Bacon Act “precludes a construction that limits the term ‘public works’ to buildings,” Labor Law § 220 should be limited solely to work on buildings. See Defs.-Resp’t’s Br. in Opp’n, at p. 40. This argument is based solely on conjecture, and is patently false, as it is clear that Labor Law § 220’s requirement that prevailing wages be paid on public works applies to far more projects than just work on public buildings. See generally Miele v. Joseph, 280 A.D. 408 (1st Dept. 1952) aff’d 305 N.Y. 667 (1953) (sign painting); Austin v. City of New York, 258 N.Y. 113 (1932) (bridge repair); Brang Co., Inc. v. State Univ. Constr. Fund, 47 A.D.2d 178 (3d Dept. 1965) (tree planting); Long Island Lighting Co. v. Indus. Comm’r, 40 A.D.2d 1003 (2d Dept. 1972) (street light installation). Finally, Defendants-Respondents argue that: It is clear from the Department of Labor’s regulations that Caddell’s dry dock does not constitute a ‘site of the work’ for Davis-Bacon Act purposes… See 29 C.F.R. § 5.2(1)(3). Specifically, Caddell’s dry 34 docks and physical plant, which are located on Staten Island, New York, were constructed there for purposes of service all clients, not just municipal clients. Accordingly, and contrary to Plaintiffs’ argument, the Davis-Bacon Act would not require the payment of prevailing wages here. Defs.-Resp’t’s Br. in Opp’n, p. 42. This argument fundamentally betrays the untenability of Defendants- Respondents’ position. Section 5.2(1)(1) of Title 20 of the Code of Federal Regulations, which provides definitions of terms relating to the Davis-Bacon Act, defines “site of the work” as “the physical place or places where the building or work called for in the contract will remain.” 20 C.F.R. § 5.2(1)(1). This regulation reflects the general situation where a “public works project” constitutes the erection of, or repair of, a structure which will remain in situ. As Justice Oliver Wendell Holmes, Jr. stated over a century ago: Of course, public works usually are of a permanent nature, and that fact leads to a certain degree of association between the notion of permanence and the phrase. But the association is only empirical, not one of logic. Whether a work is public or not does not depend upon its being attached to the soil; if it belongs to the representative of the public, it is public, and we do not think that the arbitrary association that we have mentioned amounts to a coalescence of the more limited idea with speech so absolute that we are bound to read ‘any public work’ as confined to work on land. Title Guar. & Trust Co., supra, 219 U.S. at 33 (1910) (emphasis added). Alongside the broader regulation cited to by the Defendants-Respondents regarding public works projects generally, Federal regulations also specifically 35 provide that “[v]essel repair work contracted for by representatives of the National Shipping Authority is subject to the provisions of the Davis-Bacon Act.” See Procedure for Securing Competitive Bids, 46 C.F.R. Pt. 338 § 4(f) (R. 121-122). The Department of Labor’s Wage and Hour Division’s Field Operations Handbook contains, at § 15d08, a provision entitled, “Shipbuilding, alteration, repair, and maintenance.” (R. 139.) This provision specifically dictates that the “building, alteration, and repair of ships under Government contract is work performed upon ‘public works’ within the meaning of the Davis-Bacon Act.” Id. Necessarily, facilities for “building, alteration, and repair of ships” cannot be deemed “the physical place or places where the building or work called for in the contract will remain.” Id. The generally applicable regulation cited to by Defendants-Respondents, along with every other piece of authority they cite, with the sole exception of the 1980 Opinion Letter of the Michigan Attorney General, reflects the general correlation between “public works” and objects which are “fixed.” Clearly, none of these authorities even considered the application of their general rules to vessel repair – presumably, because “public works usually are of a permanent nature, and that fact leads to a certain degree of association between the notion of permanence and the phrase. But the association is only empirical, not one of logic.” Title Guar. & Trust Co., supra, 219 U.S. at 33 (1910). 36 Were 20 C.F.R. § 5.2(1)(1)’s definition of the “site of work” to be applied to vessel repair, then no shipbuilding, alteration, or repair of ships could ever be considered “public work” requiring payment of prevailing wages. Clearly, this is not the case. That regulation, like all other authority cited to by the Defendants- Respondents with the exception of a single 1980 Opinion Letter from the Michigan Attorney General, relies upon the word “fixed” in contexts where the word “fixed” is of no moment whatsoever. Thus, Defendants-Respondents’ interpretation creates the absurd result that Federal regulations using general definitions of general applicability obviate a specific holding of the United States Supreme Court where the practice of applying the general construction term “fixed” to the special instance of shipbuilding and repair was rejected. This Court has reflected its willingness to ignore a strict, dictionary definition of words in upholding workers’ right to receive prevailing wages. See generally Austin v. City of New York, 258 N.Y. 113 (1932) (“There is no magic in the word foreman. Whether it stands for a workman or for something else cannot be known in advance as a matter of dictionary definition, without knowledge or heed of the conditions of the job”). This is especially true where a strict, dictionary interpretation of a word would require an absurd result, limiting the effect of a law intended to protect workers. See Surace v. Danna, 248 N.Y. 18 (1928) (“Few words are so plain that the context or the occasion is without capacity to enlarge or 37 narrow their extension. The thought behind the phrase proclaims itself misread when the outcome of the reading is injustice or absurdity. Adherence to the letter will not be suffered to defeat the general purpose and manifest policy to be promoted”) (internal citations and punctuation omitted). Part IV: PUBLIC POLICY CONSIDERATIONS REQUIRE THAT REPAIR OF PUBLIC VESSELS BE CONSIDERED “PUBLIC WORK” REQUIRING PAYMENT OF PREVAILING WAGES Defendants-Respondents point out to this Court that various New York municipal agencies have contracted public vessel repair to out-of-state contractors who pay wages substantially lower than those prevailing in New York. See Defs.- Resp’t’s Br. in Opp’n, at pp. 2-3. Contrary to Defendants-Respondents’ position, this fact militates heavily in favor of this Court determining, as a matter of public policy, that the publically financed repair of publically owned vessels be considered “public work” requiring payment of prevailing wages. Requiring that a pre-determined, set prevailing wage and benefit rate be paid by all contractors bidding on repairs of publically owned and operated New York vessels would ensure that New York contractors are operating on a level playing field with dry- docks located in other regions such as Virginia, Maryland, or Alabama, where wage rates are lower than in New York. 38 Both the Davis-Bacon Act and New York Labor Law § 220 were designed to ensure that government contracts did not serve to disadvantage local workers by permitting work to be performed by contractors utilizing workers willing to accept less than the wages prevailing in the locality. In support of H.R. 17069, the original bill that would later become the Davis-Bacon Act, Rep. Robert Bacon (R., NY) provided the following justification: The Government is engaged in building in my district a Veteran’s Bureau hospital. Bids were asked for. Several New York contractors bid, and in their bids, of course, they had to take into consideration the high labor standards prevailing in the State of New York. The bid, however, was let to a firm from Alabama who had brought some thousand non-union laborers from Alabama into Long Island, N.Y.; into my district. They were herded onto this job, they were housed in shacks, they were paid a very low wage, and the work proceeded...It seemed to me that the federal Government should not engage in construction work in any state and undermine the labor conditions and the labor wages paid in that State...The least the federal Government can do is comply with the local standards of wages and labor prevailing in the locality where the building construction is to take place. U.S. 69th Congress, 2nd Session (1927), Hearings before the Committee on Labor, House of Representatives, 31 January, Government Printing Office, Washington, D.C. at p. 2 Similarly, the New York legislature which originally enacted the State’s first prevailing wage law in 1894 was faced with complaints from New York laborers that non-New York residents were being brought in to New York to provide cheap labor on public works projects. These non-New Yorkers worked for wages far 39 below those prevailing amongst New York laborers, effectively leading to the State of New York subsidizing non-New Yorkers at the expense of its own citizens. In an 1896 report from Bureau of Statistics of Labor to the State of New York, provided to the legislature on March 2, 1896, the legislature was informed of complaints by its constituents such as these: “The only difficulty the bricklayers have is the influx of members of their craft from other States and countries to this city which is almost impossible to overcome… our trade suffers greatly from foreigners coming here and undermining the American citizens by working for whatever they can get. At the present time you will find that most of the carpenters that are out of work are citizens of the United States; while those employed are foreigners, especially Swedes, working at wages ranging from $1.75 per day up to the standard wages, $3.25 per day. They very seldom get more than $2.50 per day. Thirteenth Annual Report of the Bureau of Statistics of Labor of the State of New York for the Year 1895, 1896 NY Legis. Doc. No. 73, at 387-388. Doubtlessly, this was precisely the type of harm to New York residents which the legislature hoped to prevent by passing prevailing wage laws. It is explicitly the type of harm which Representative Bacon sought to prevent by passing the Davis-Bacon Act, and it is expressly the type of harm which Defendants-Respondents complain when they point out that “the City already does contract with out-of-state companies for similar maintenance contracts.” See Defs.- Resp’t’s Br. in Opp’n, at p. 2. 40 As this Court has held, the purpose of Labor Law § 220 “is to equalize minimum labor costs between union contractors and nonunion employers who held an unfair advantage through lower labor costs.” Associated Builders & Contractors, Inc. v. Rochester, 67 N.Y.2d 854, 856 (1986). When discussing the 1956 amendments to Labor Law § 220, this Court opined that “[t]he available documentary background to this amendment reflects only a concern to equalize contractors' minimum labor cost.” Action Elec. Contractors, Co. v. Goldin, 64 N.Y.2d 213, 222 (1984). Similarly, one Appellate Division court has held that the requirement that a set schedule of wages and benefits be paid to workers on a public works contract is included in the bidding materials is to ensure that all contractors are on a level playing field at the bidding stage: “The Legislature, by amending subdivision (3) of the statute to require a schedule of prevailing wages and supplements to be annexed to the work specifications, provided an incidental benefit to contractors by affording them foreknowledge of the requirements and by placing nonunion and union contractors on an equal footing at the bidding stage.” E. Williamson Roofing & Sheet Metal Co., v. Town of Parish, 139 A.D.2d 97, 104 (4th Dept. 1988). Requiring that all bidders on a publically-financed New York vessel repair contract pay the same level of wages and supplemental benefits ensures in-state and out-of-state contractors start out on an equal footing with respect to labor costs 41 at the bidding stage, and ensures that New York contractors cannot be outbid by out-of-state contractors who can afford to post a lower bid by underpaying its workers using New York tax dollars. Indeed, if all contractors are required to pay the same wage rates, then contractors such as Caddell, being located in New York, will hold a competitive advantage over the national competition who will be forced to incur the additional high costs of transporting vessels to and from their dry- docks many hundreds or thousands of miles away. Labor Law § 220 “is an attempt by the State to hold its territorial subdivisions to a standard of social justice in their dealings with laborers, workmen and mechanics.” Austin v. City of New York, 258 N.Y. 113, 117 (1932). In interpreting Labor Law § 220, this Court is “required to give effect to a unique statutory scheme, one that has as its entire aim the protection of workingmen against being induced, or obliged, to accept wages below the prevailing rate from a public employer.” Bucci v. Village of Port Chester, 22 N.Y.2d 195, 201 (1968). As this Court has held, the State of New York is required to apply its public works laws equally to New York and out-of-state contractors. See Salla v. County of Monroe, 48 N.Y.2d 514 (1979). Recognizing this, the Department of Labor already enforces the payment of prevailing wages by contractors performing construction work on items removed from and then returned to their place of public ownership in New York, recognizing that failing to do so would lead to contractors 42 performing construction work in localities with lower wage levels at the expense of New York workers. See Memorandum from Robert Gollnick, Deputy Commissioner of Labor, State of New York Department of Labor, to John Hudacs, Commissioner of Labor State of New York Department of Labor, May 25, 1994 (“The Bureau of Public Work presently enforces the prevailing wage for all bridge repainting, no matter where the work is done… The Board has recommended that we continue to enforce the wage in this manner”).8 Contrary to Defendants-Respondents’ contention, the fact that its dry-dock facility is located on private property does not change the fundamental nature of the work it performs on publically owned vessels – Caddell is not a materialman, in the business of providing goods in the stream of commerce. Caddell very specifically, as relevant here, took possession of structures owned and operated by subdivisions of the State of New York, employed laborers to perform difficult, dangerous work in reconstructing those structures, and then returned them to their public owners. As Defendants-Respondents argue, “fixed structures can be moved from [w]here they are ‘erected’ and fixed again.” See Defs.-Resp’t’s Br. in Opp’n, at p. 30. Fundamentally, Caddell’s repairs to publically owned vessels are the functional 8 A copy of this opinion letter is available at http://www.vandallp.com/files/pdf/may-25-1994.pdf 43 equivalent of moving a school building from one location to another, performing repairs on it there, and then returning it to its original location. The nature of vessels allows this method of reconstruction and repair. Enforcing the prevailing wage provisions included in their contracts to perform this work will serve only to put New York contractors, and their New York employees, on an equal footing with out-of-state contractors who can find workers willing to work for lower wages, thereby circumventing both competitive bidding laws and prevailing wage laws. 44 CONCLUSION Wherefore, for the reasons set forth above, it is respectfully requested that the Decision and Order of the Appellate Division, First Department, dated April 12, 2012; and the Order of the Supreme Court, Bronx County, dated May 19, 2010 (Guzman, J.), be reversed, and this Court grant such relief as the Court deems just and proper. Dated: New York, New York February 14, 2013 Virginia & Ambinder, LLP Attorneys for Plaintiffs-Appellants Trinity Centre 111 Broadway, Suite 1403 New York, New York 10006 (212) 943-9080 By:____________________________ James Emmet Murphy, Esq. Lloyd R. Ambinder, Esq.