author: Bellacosa, J.

text:
    Kathryn Johnson, Individually and as Administratrix of the Estate of Veronica Ashby, Deceased, Respondent, v Manhattan & Bronx Surface Transit Operating Authority, Appellant, et al., Defendant.
    Argued November 12,1987;
    decided January 12, 1988

      POINTS OF COUNSEL

      John A. Murray and Albert C. Cosenza for appellant.
    I. Appellant’s actionable negligence was not established on either statutory or common-law grounds. (Sadowski v Long Is.

      R. R. Co., 292 NY 448; Matter of Ryan v City of New York, 228 NY 16; Somersall v New York Tel. Co., 52 NY2d 157; Lotito v Kyriacus, 272 App Div 635, 297 NY 1027; Walter v Bond, 267 App Div 779, 292 NY 574; Podstupka v Brannon, 81 Misc 2d 338, 54 AD2d 692, 42 NY2d 803; People v Mobil Oil Corp., 48 NY2d 192; Berger v City of New York, 260 App Div 402, 285 NY 723; Banellis v Yackel, 49 NY2d 882; Burks v Bosso, 180 NY 341.) II. The judgment should not be sustained since the verdict on both issues was affected by prejudicial evidentiary and charge errors. (Trimarco v Klein, 56 NY2d 98; Cover v Cohen, 61 NY2d 261; Carhart v Relmar Operating Corp., 66 AD2d 680; Martin v Herzog, 228 NY 164; Bennett v Long Is. R. R. Co., 163 NY 1; Marquard v Erie R. R. Co., 291 NY 538; Tedla v Ellman, 280 NY 124; Kaplan v City of New York, 6 AD2d 489, 10 AD2d 319; Sawyer v Dreis & Krump Mfg. Co., 67 NY2d 328; Loschiavo v Port Auth. of N. Y. & N. J., 58 NY2d 1040.) III. The judgment may not be sustained when the award for pecuniary loss was also affected by prejudicial evidentiary and charge error. (Holmes v City of New York, 269 App Div 95, 295 NY 615; Kraus v Ford Motor Co., 55 AD2d 851; Louissaint v Hudson Waterways Corp., 111 Misc 2d 122; Juditta v Bethlehem Steel Corp., 75 AD2d 126; Zipprich v Smith Trucking Co., 2 NY2d 177; Fritz v Consolidated Rail Corp., 68 NY2d 877; Gilliard v New York City Health & Hosps. Corp., 77 AD2d 532; Norfolk & W. Ry. Co. v Liepelt, 444 US 490; In re Air Crash Disaster Near Chicago, 701 F2d 1189.)

      Theodore H. Friedman, Bernard S. Meyer, Edward T. Chase and Michael A. Ciaffa for respondent.
    I. The trial record contains sufficient evidence from which the jury could reasonably conclude that defendant breached its common-law and statutory duty by leaving its bus unattended, thereby causing Veronica Ashby’s death. (Davis v Caldwell, 54 NY2d 176; Russo v Jess R. Rifkin, D.D.S., P. C., 113 AD2d 570; Suria v Shiffman, 67 NY2d 877; Tierney v New York Dugan Bros., 288 NY 16; Connell v Berland, 223 App Div 234, 248 NY 641; Gumbrell v Clausen-Flanagan Brewery, 199 App Div 778; Lee v Van Buren & N. Y. Bill Posting Co., 190 App Div 742; Luedeke v New York Cent. & Hudson Riv. R. R. Co., 164 App Div 104; Mann v Parshall, 229 App Div 366; Maloney v Kaplan, 233 NY 426.) II. The trial court’s evidentiary rulings admitting testimony as to prior bus thefts and unauthorized boardings by children and "winos,” and its charge with respect to Vehicle and Traffic Law § 1210 (a) and the issues and foreseeability and proximate cause, were proper and not prejudicial. (Ferrara v Galluchio, 5 NY2d 16; Martin v Herzog, 228 NY 164; Zegarelli v Colp, 91 Misc 2d 430; Kass v Schneiderman, 21 Misc 2d 518.) III. The trial court did not err in excluding proof as to the "after-tax income” Veronica Ashby would have retained or in refusing to charge that the jury’s award would not be subject to tax. (Coleman v New York City Tr. Auth., 37 NY2d 137; Sullivan v Held, 81 AD2d 663; Vasina v Grumman Corp., 644 F2d 112; Woodling v Garrett Corp., 813 F2d 543; Petition of Marina Mercante Nicaraguense, 364 F2d 118, 385 US 1005; McWeeney v New York, New Haven & Hartford R. R. Co., 282 F2d 34, 364 US 870.)
   OPINION OF THE COURT

Bellacosa, J.

In this action for wrongful death and conscious pain and suffering, we focus primarily on defendant’s argument that the trial court erred in two respects on damages: (1) excluding evidence of the decedent’s after-tax income for calculating damages based on the lost wages component; and (2) refusing to instruct the jury that, despite the over-all nontaxability of the award, the part of the damages calculation on decedent’s lost wages component should nevertheless be based on decedent’s net rather than gross income. Defendant also argues that, in any event, it should not be held liable in negligence under any theories advanced at trial.

We affirm the order of the Appellate Division and hold that the trial court did not err in its evidentiary or charge rulings on the tax aspects of the damages calculation. We further hold that liability was properly imposed against MABSTOA.

I. FACTS AND TRIAL

On the morning of September 27, 1979, a bus driver employed by defendant Manhattan and Bronx Surface Transit Operating Authority (MABSTOA) returned the bus he had been driving to defendant’s depot located between 146th Street and 147th Street and reported that he was sick. The MABSTOA dispatcher told the driver to "park the bus” and to sign himself out for the day. The driver parked the bus on 146th Street, outside the depot.

Shortly afterwards, the bus was driven away by one Thomas Jones, who had been drinking since the night before and who was, by .his own admission, "loaded”. According to his testimony, Jones was walking towards Lenox Avenue to catch a bus to the Port Authority bus terminal when he spotted the parked unattended bus. He entered the bus by opening the driver’s side window and pulling the lever to open the door. Once inside the bus, he pushed the starter button on the dashboard, put the bus in gear, closed the door and drove off. At the corner of 146th Street, Jones made a wide left turn onto Lenox Avenue and struck the decedent, Veronica Ashby. The bus dragged the victim nearly a block, striking other vehicles, and killing another pedestrian before coming to rest.

Plaintiff, the decedent’s mother and administratrix of her estate on behalf of decedent’s minor child, commenced this action for wrongful death and conscious pain and suffering. MABSTOA’s liability was premised on common-law negligence and violation of Vehicle and Traffic Law § 1210 (a), which provides that "[n]o person driving or in charge of a motor vehicle shall permit it to stand unattended without first stopping the engine, locking the ignition, removing the kcsy from the vehicle, and effectively setting the brake thereon”.

At trial, plaintiff’s economist testified as to the decedent’s lost earnings. On cross-examination in this respect, defense counsel questioned only whether the calculation was based on gross income or after-tax income. The economist responded that the figures were based on the decedent’s gross income at the time of death. At that point, the court interjected and informed the jury: "Income taxes of whatever nature, be they federal, state or city, should not be considered by the jury in arriving at the ultimate determination.” Defense counsel made no objection to the economist’s response or to the instruction.

At the close of proof, defense counsel requested that the jury be instructed to calculate the pecuniary loss to decedent’s daughter in the following manner:

"In considering what award you made for any loss by decedent’s children of decedent’s past and future earnings, please consider the following:

"Had decedent lived, the money she earned at her job as a police aide would have been subject to federal, state and city tax withholdings.

"But any award you make to decedent’s pecuniary beneficiaries for the loss of their mother’s income will not be subject to any tax, federal, state or city. In arriving at any decision on the award for the loss of decedent’s future earnings you should consider the fact that your award will not be subject to taxes, and will therefore exceed what decedent’s take-home pay would have been during her working career.

"Your award, if any, should only equal the net pay decedent would have received had she lived [emphasis supplied].”

The court, over defense counsel’s objection, refused to give the requested charge.

The jury found defendant MABSTOA liable on common-law negligence and on the statutory violation. Plaintiff was awarded $800,000 for the wrongful death and $3.2 million for the conscious pain and suffering of the decedent. The trial court later granted defendant’s motion to set aside the verdict unless plaintiff accepted a reduction of the award for conscious pain and suffering to $250,000. Plaintiff stipulated to accept the lower amount and the judgment then fixed damages at $800,000 for wrongful death and $250,000 for pain and suffering. The Appellate Division affirmed, without opinion.

Defendant MABSTOA appeals, urging: (1) the trial court erred in excluding proof of decedent’s after-tax income and in refusing defendant’s requested jury instruction for a net income computation; (2) the "key-in-the-ignition” statute (Vehicle and Traffic Law § 1210 [a]) is not applicable to vehicles equipped with a push button starter; (3) common-law negligence was not established.

II. DAMAGES — TAX IMPLICATIONS

One of the important issues raised by defendant relates to claimed excessiveness of the final award in that it was improperly inflated due to the jury’s misunderstanding of tax implications resulting from the allegedly erroneous evidentiary ruling and from the lack of proper jury instruction.

In wrongful death cases, an award of damages is limited to the "fair and just compensation for the pecuniary injuries resulting from the decedent’s death to the persons for whose benefit the action is brought” (EPTL 5-4.3). In determining what is "fair and just compensation”, factors which have traditionally been considered include: the age, health and life expectancy of the decedent at the time of the injury; the decedent’s future earning capacity and potential for career advancement; and the number, age and health of the decedent’s distributees (Rohan, Practice Commentary, McKinney’s Cons Laws of NY, Book 17B, EPTL 5-4.3, at 497-498). Generally, evidence of a decedent’s gross income at the time of death is the standard to measure the value of income already lost and to measure the loss of future earnings (Woodling v Garrett Corp., 813 F2d 543, 557-558 [2d Cir] [and cases cited in that opinion]).

On appeal, defendant urges that a worker’s ability to contribute to the support of a family is directly affected by the amount of taxes owed to the government, and after-tax or net income rather than gross income provides the more realistic and legally correct measure of the monetary loss suffered. While there is respectable authority (Norfolk & W. Ry. Co. v Liepelt, 444 US 490, 494 [1980], reh denied 445 US 972; Morgan Guar. Trust Co. v Texasgulf Aviation, 604 F Supp 699 [1985]), and while abstract logic could favor defendant’s view, we conclude that such a rule would inject an unacceptably speculative and distracting feature into the jury’s consideration of damages, and thus we reject it as a matter of statutory construction, practical policy and sound jurisprudence.

No crystal ball is available to juries to overcome the inevitable speculation concerning future tax status of an individual or future tax law itself. Trial strategies and tactics in wrongful death actions should not be allowed to deteriorate into battles between a new wave of experts consisting of accountants and economists in the interest of mathematical purity and of rigid logic over less precise common sense. Countless numbers of unknown and unpredictable variables for tax purposes alone include, as mere examples, future marital and family status, changes in rates, exemption and deduction provisions of overlapping tax codes. All sides to this issue would no doubt agree at least that this could produce much guesswork. So, a majority of jurisdictions have wisely stayed with a rule precluding evidence of after-tax income on the earnings damage issue to avoid "turning every negligence case into a trial [at least] of the future federal income tax structure” involving "a parade of tax experts” (Nordstrom, Income Taxes and Personal Injury Awards, 19 Ohio St LJ 212, 228 [1958]; Vaughan, Tax Issues of Personal Injury and Wrongful Death Awards, 19 Tulsa LJ 702 [1984]; see also, Cunningham v Rederiet Vindeggen A/S & M/S Trolleggen, 333 F2d 308, 313 [2d Cir 1964]; see also, Beaulieu v Elliot, 434 P2d 665, 673 [Alaska 1967]; Dempsey v Thompson, 363 Mo 339, 251 SW2d 42, 45 [1952]; Girard Trust Com Exch. Bank v Philadelphia Transp. Co., 410 Pa 530, 538, 190 A2d 293, 298 [1963]; Hoge v Anderson, 200 Va 364, 106 SE2d 121, 123-124; Annotation, 16 ALR4th 589, 605-609). We are persuaded that the gross income standard was correctly applied with respect to calculations of lost wages in this case.

Support for the correctness of our policy choice is particularly found in the recent legislative enactment specifically authorizing evidence of after-tax income to be considered only in medical and dental malpractice personal injury and wrongful death actions (see, L 1986, ch 266, §§ 4, 6; EPTL 5-4.3 [c]; CPLR 4546). This is not such a case. The implied recognition of the general exclusion of tax considerations, incorporating a specific authorization in specified cases, clearly suggests that any expansion of these rules for now should come from the Legislature. It is especially pertinent to note that this limited statutory authorization came about in the context of a complex negotiation addressing many facets of the so-called insurance and liability crises. The final legislative package, for example, rejected a proposed ceiling on recoveries for noneconomic damages despite a recommendation (among an 18-point program) to the contrary by the Governor’s Advisory Commission on Liability Insurance (Insuring Our Future, Report of Governor’s Advisory Commission on Liability Insurance, Apr. 7, 1986). Instead the Legislature adopted a limited approach designed to reduce proportionately the size of some verdicts by allowing the trier of fact to consider the impact of personal income tax when determining an award for lost earnings only in the specified malpractice categories.

Notably, the charge requested by defendant in this case is also in sharp contrast to the general nontaxability instruction which we approve in Lanzano v City of New York (71 NY2d 208). Indeed, our rejection in this case of defendant’s desire to use after-tax income — through the admission of net income evidence coupled with a corresponding jury instruction — is consistent with the policy rationale of Lanzano v City of New York (id.) because both keep tax complications out of the jury’s deliberations. Contrary to Lanzano, whose precise issue is neither presented or preserved here, this defendant requested a charge which would have taken the jury a great distance beyond Lanzano’s mere instruction of nontaxability and nonrelevancy; it would have required the jury to calculate the lost wages component of the over-all damages award based on the decedent’s after-tax income. Where Lanzano takes tax entanglements out of a case and out of misinformed speculation, defendant’s contention in this case would drive the tax consideration right back into the heart of the deliberations.

There should be no illusion but that introduction of evidence of after-tax income is intended to lessen the over-all amount of awards by decreasing the components, formulas and foci of the jury. While we fully recognize the lack of mathematical certainty of jury damage awards, we are also realists appreciating the futility of expecting these kinds of unknowable projections to change very much except perhaps to add bedeviling confusion.

In this case, the court’s charge to the jury properly reflected standard principles (accord, PJI 2:320 [2d ed 1974]). Indeed, while this court has not up to now definitively spoken to the gross versus net income issue, there can be no doubt that defendant’s argument, were it to be adopted, would mark a significant shift in our law of damages.

We hold that without express statutory direction to the contrary, the damages component of a plaintiff’s award as to lost wages in this action should be based on gross projected earnings and no deduction or consideration of after-tax net should be allowed into evidence or charged to the jury. '

With respect to the adequacy of the jury instruction given on damages and on taxation aspects of this case, defendant failed to object to the trial court’s instruction that "income taxes of whatever nature” should not be considered by the jury, so that aspect of the case is unpreserved and beyond our review (see, Lanzano v City of New York, 71 NY2d 208, supra).

III. LIABILITY

Turning to the statutory violation theory, we note that to sustain defendant’s liability on this basis plaintiff must establish: (1) that the statute is applicable; (2) that the statute was violated; and (3) that plaintiff was injured as a consequence of the violation (Homin v Cleveland & Whitehill Co., 281 NY 484, 488; Prosser and Keeton, Torts § 36 [5th ed]). Defendant contends that Vehicle and Traffic Law § 1210 (a) is inapplicable because no key was left in the ignition. We disagree. The decedent was within the class of persons the Legislature sought to protect and the harm suffered is the kind which the statute was intended to prevent inasmuch as the bus was equipped with a push button starter and, if left unattended with an unlocked ignition, the engine could be started without a key just like any vehicle left with a key in the ignition.

In recognition of the fact that auto theft is a crime of opportunity, the Legislature enacted Vehicle and Traffic Law § 1210 (a) to serve as a deterrent to such opportunities and to protect the public from injury due to the operation of motor vehicles by unauthorized persons (Report of Joint Legis Comm on Motor Vehicle Problems, 1954 NY Legis Doc No. 36, at 106-107). Here, testimony clearly established the bus was unattended, the windows were unlocked and the safety switch, which could have locked the ignition and prevented the operation of the push button starter by a thief, was not engaged by defendant’s employee. Thus, the defendant provided the opportunity for the theft in violation of the statute and started the chain of events causing and culminating in the deaths of two pedestrians. That the engine could be started without a key does not take the case out of the statute for civil liability purposes under these circumstances because the modern device employed here and designed for the benefit of the defendant is the functional equivalent of the leaving-the-key-in-the-ignition danger that the statute forbids.

Finally, since liability was properly imposed on the basis of the statutory violation, we need not consider defendant’s common-law negligence argument.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Hancock, Jr., concur.

Order affirmed, with costs.


source: Caselaw Access Project

license: Public Domain

text:
    Thomas Lanzano et al., Appellants, v City of New York, Respondent.
    Argued November 12, 1987;
    decided January 12, 1988

      POINTS OF COUNSEL

      Sherwood Allen Salvan and Harry Salvan for appellants.
    I. The jury should not have been informed that appellants’ recovery was not taxable or that plaintiff was receiving a nontaxable disability pension. (Towli v Ford Motor Co., 30 AD2d 319; Coleman v New York City Tr. Auth., 37 NY2d 137; Louissaint v Hudson Waterways Corp., 111 Misc 2d 122; Sullivan v Held, 81 AD2d 663; Woodling v Garrett Corp., 813 F2d 543.) II. In the absence of showing that the interest of justice and good cause exist, the failure to exchange medical reports precludes the introduction of testimony at the trial pursuant to rule 660.10 of the Supreme Court. (Kastner v Rodriquez, 91 AD2d 950; Valenti v Chanice, 75 AD2d 850; Rivera v City of New York, 107 AD2d 331.) III. The cumulative impact of the errors deprived appellants of having a fair and reasonable verdict for the injuries sustained. (Bromberg v City of New York, 25 AD2d 885; Healy v Rennert, 9 NY2d 202; Silinsky v State-Wide Ins. Co., 30 AD2d 1; Anatasia v Barnes, 127 Misc 2d 971; Saleeby v Kingsway Tankers, 531 F Supp 879; McWeeney v New York, New Haven & Hartford R. R. Co., 282 F2d 34; Munson v Long Is. R. R. Co., 191 F Supp 748; Horn v State of New York, 31 AD2d 364; Matter of Burris v Lewis, 2 NY2d 323; Lindwall v Talent Cab Corp., 51 Misc 2d 381.)

      Peter L. Zimroth, Corporation Counsel (Lin Saberski and Stephen J. McGrath of counsel), for respondent.
    I. The trial court did not err in instructing the jury to disregard the effect of income taxes in calculating its award. (Coleman v New York City Tr. Auth., 37 NY2d 137; Towli v Ford Motor Co., 30 AD2d 319; Norfolk & W. Ry. Co. v Liepelt, 444 US 490; Burlington N. v Boxberger, 529 F2d 284; Grant v City of Duluth, 672 F2d 677; In re Air Crash Disaster Near Chicago, 701 F2d 1189, cert denied sub nom. Kahl v McDonnell Douglas Corp., 464 US 866.) II. The trial court did not abuse its discretion as a matter of law in permitting defendant’s medical expert to testify despite an alleged failure by defendant to provide plaintiffs’ counsel with a copy of the doctor’s report, where defendant’s counsel believed he had supplied the report, plaintiffs’ counsel knew the expert had examined Mr. Lanzano, and testimony based on that report was cumulative. (Rivera v City of New York, 107 AD2d 331, 66 NY2d 912; De Stefano v Gonzalez, 38 AD2d 532; Wonsch v Snyder, 53 AD2d 1031; Holshek v Stokes, 122 AD2d 777.) III. Plaintiffs’ remaining allegations are without merit. (McLaurin v Ryder Truck Rental, 123 AD2d 671; Matter of Northeast Cent. School Dist. v Webutuck Teachers Assn., 121 AD2d 544; Bell v Shopwell, Inc., 119 AD2d 715; Carroll v City of New York, 37 Misc 2d 563; Havas v Victory Paper Stock Co., 90 AD2d 864, 58 NY2d 605; Nappi v Falcon Truck Renting Corp., 286 App Div 123, 1 NY2d 750; Marshall v Meade, 23 Misc 2d 162; Kane v Zade, 63 AD2d 993, 45 NY2d 709; Coleman v City of New York, 37 AD2d 764; Loeb v Teitelbaum, 112 Misc 2d 1039.)
   OPINION OF THE COURT

Bellacosa, J.

The primary action is by an injured New York City sanitation employee seeking damages for personal injury. He appeals, contending that the trial court’s instruction to the jury that the award of damages would not be subject to income taxation constituted error and aggrieved him because the jury awarded him less than it would have absent that instruction. We affirm the Appellate Division order upholding the trial court ruling because the instruction was not erroneous.

On February 20, 1980, plaintiff Thomas Lanzano suffered a line-of-duty injury while working as a laborer for the Department of Sanitation and was granted disability retirement in June 1981. He subsequently brought an action against his employer, the City of New York, which is not governed by the Workers’ Compensation Law (see, Workers’ Compensation Law § 3 [1], group 17), seeking damages for pain and suffering and loss of future income; his wife sued for loss of services and companionship. The issue of liability was determined against the City and is conclusive, and there is no appeal as to that. At the close of proof on the trial of damages, however, the Judge instructed the jury, over plaintiffs’ objection, that "any amount of money damages you award the plaintiffs will not be subject to income taxes and you should not consider income taxes, therefore, on the award, in fixing the amount of your award”.

The jury returned a verdict in favor of plaintiff, awarding him $75,000 damages for pain and suffering and $112,000 for past and future lost earnings. Plaintiffs wife was awarded $13,000 damages for loss of consortium. The Appellate Division affirmed, without opinion. Only the plaintiff appeals as limited to the claimed insufficient damages awarded to him, arguing that the jury should have been told nothing with respect to the nontaxability of the award.

Section 104 (a) (2) of the Internal Revenue Code of 1954 (26 USC § 104 [a] [2]) provides that the amount of damages received on account of personal injuries is not taxable income. The long-standing traditional rule in New York has been that Trial Judges are "not required to charge the jury that any award to the plaintiff would be free of income tax” (Coleman v New York City Tr. Auth., 37 NY2d 137, 145 [emphasis supplied]). Numerous courts and commentators have recently expressed support for a more forthcoming and informative instruction, noting that the nontaxability of the personal injury damage award is an important reality which the jury should be at least aware of (see, Norfolk & W. Ry. Co. v Liepelt, 444 US 490, reh denied 445 US 972; Fritz v Consolidated Rail Corp., 68 NY2d 877; see also, Vaughan, Tax Issues of Personal Injury and Wrongful Death Awards, 19 Tulsa LJ 702, 724-728 [1984]; Nordstrom, Income Taxes and Personal Injury Awards, 19 Ohio St LJ 212 [1958]; Comment, Personal Injury Awards and the Nonexistent Income Tax — What is a Proper Jury Charge?, 26 Fordham L Rev 98, 102-103 [1957]). In this respect, courts are mindful of the growing "tax consciousness” of the American public and the pervasiveness of tax realities in our society. While the average juror may be generally aware of the over-all impact of income taxes, it would be rare indeed if more than a handful would know that personal injury awards are excluded from taxation.

We should not blind ourselves to the possibility that ignorance of relevant rules in this highly specialized complex field could contribute to juries proceeding on erroneous speculations and assumptions and rendering unfair and inaccurate verdicts. Juries should not be allowed to increase or decrease awards based on misconceptions of the law when simple and straightforward instructions of relevant rules are readily available to help them in the truth-finding process (contrast, Johnson v Manhattan & Bronx Surface Tr. Operating Auth., 71 NY2d 198).

While this court is aware, of course, of the inherent difficulty in achieving mathematical accuracy in this area and of the competing factors in the adversarial process, we are nevertheless convinced that the process of arriving at fair and correct results is enhanced by juries being well informed and treated as sensible, intelligent human beings capable of following instructions and of balancing nuances. On the contrary, it ill serves the judicial process to place hands over our Trial Judges’ mouths and over the eyes and ears of the jurors with respect to this issue, letting them grope in ignorance of a simple fact.

Moreover, informing juries as to the nontaxability of all exempted awards is consistent with the primary purpose of jury instructions. The court’s obligation is to instruct the jury on the applicable law and to help minimize erroneous speculation flowing from jurors applying their own general experience and sometimes erroneous knowledge in reaching the damage aspect of their verdicts. While there can be no guaranteed certainty or perfection, the trial courts, through careful, fair and explicit jury instruction, can minimize erroneous speculation, at least in this correctable area, even though we are tolerant that general verdicts partake of some commonsense approximations (accord, Johnson v Manhattan & Bronx Surface Tr. Operating Auth., 71 NY2d 198, supra).

As a matter of prudent policy, it is better practice in all cases where jury awards are excluded from taxation under 26 USC § 104 (a) (2) for the jury to be instructed in substance that such awards, if any, are not subject to income taxes, and that it should not add or subtract from the award on account of income taxes but should follow the ordinary, specific instructions for measuring damages which the courts usually give. Taxes should be treated for what they are in this area— a speculative and irrelevant nonfactor.

This rule would also make uniform the treatment of damages in jury trials with those fixed in nonjury trials, where Judges trained in the law and knowledgeable about the nontaxability of such awards surely exclude that datum from the damages calculation, as they should, and now as juries should as well.

In this case, the trial court, over plaintiff’s objection, instructed the jury that the award would not be subject to taxation under 26 USC § 104 (a) (2) and that it should not consider the tax consequences when figuring the amount of damages. We hold that the instruction in this case was not error and expressly authorize such instructions to be given. We also take this opportunity, however, to express our preference, as we build on the Coleman (Coleman v New York City Tr. Auth., 37 NY2d 137, supra) case rule, that the charge state a specific direction not to add or subtract from the award because of the nontaxability of the award. To the extent that Coleman (id.) has been read as being inconsistent with this holding, that interpretation is declared erroneous.

We have reviewed plaintiffs other contentions and conclude they are without merit. Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone and Hancock, Jr., concur.

Order affirmed, with costs.


author: Per Curiam.

text:
    The People of the State of New York, Respondent, v Wilfredo Rodriguez, Appellant.
    Argued November 12,1987;
    decided January 14, 1988

      POINTS OF COUNSEL

      B. Kay Huff and Philip L. Weinstein for appellant.
    The court erred in not declaring a mistrial when a juror on the second day of deliberations approached the court and asked to be excused because she was prejudiced against black Hispanics like appellant and, therefore, could not deliberate fairly. (Patton v Yount, 467 US 1025; People v Blyden, 55 NY2d 73; Aldridge v United States, 283 US 308; People v McCray, 57 NY2d 542, 461 US 961; People v Decker, 157 NY 186; United States v Heller, 785 F2d 1524; McDonough Power Equip, v Greenwood, 464 US 548; Batson v Kentucky, 476 US 79; People v Torpey, 63 NY2d 361; People v Dodt, 61 NY2d 408.)

      Robert M. Morgenthau, District Attorney (Maryjane C. Shim-sky and Mark Dwyer of counsel), for respondent.
    Defendant’s guilt was determined by 12 fair and impartial jurors and thus he is not entitled to another trial. (People v Cargill, 70 NY2d 687; People v Buford, 69 NY2d 290; People v Williams, 63 NY2d 882; People v Blyden, 55 NY2d 73; People v Culhane, 33 NY2d 90; People v McCray, 57 NY2d 542; People v Taylor, 120 AD2d 325; People v Leonti, 262 NY 256; People v Rukaj, 123 AD2d 277; People v Testa, 103 AD2d 973, 61 NY2d 1008.)
   OPINION OF THE COURT

Per Curiam.

After a jury trial defendant was convicted of criminal sale of a controlled substance in the third degree, and criminal possession of a controlled substance in the third and seventh degrees. The Appellate Division unanimously affirmed the conviction. Defendant argues on this appeal that the trial court erred in denying his motions for a mistrial, and later to set aside the verdict, on the grounds that one juror was "grossly unqualified” within the meaning of CPL 270.35, and that he was denied a fair trial under the Federal and State Constitutions. We now reverse the order of the Appellate Division, and hold that when, during a break in deliberations, the juror stated to the Trial Judge that the juror’s bias against dark-skinned Hispanics was affecting her ability to make a decision on guilt or innocence, under the particular facts of this case and after a hearing on the issue the Judge should have determined that the juror was "grossly unqualified to serve.”

During the trial, one juror became ill and was replaced with an alternate juror. Another juror became ill during deliberations and, with defendant’s consent, was replaced by the one remaining alternate juror. Deliberations then continued.

Shortly thereafter, the jury informed the court officers that the jury was deadlocked, and the court officers instructed them to send the Judge a note. The Trial Judge then received a note stating only that a third juror wished to be excused. This juror was brought into the courtroom and, in the presence of counsel and defendant, explained that she wished to be excused "because of the emotional factors,” and stated that "I cannot make a decision. I can’t go guilty or not guilty.” When the Trial Judge asked for the reasons for the juror’s indecision, this exchange took place:

"juror no. five: First of all, on Thursday morning on the subway I was * * * bothered, touched, handled by a dark Hispanic man on the subway. And I am holding that against this defendant. And I don’t think it’s fair for me to make a decision. I mean, I can’t. It’s something that happened to me after I had been on the jury. I can’t disassociate it.

"the court: And you’re condemning the whole Hispanic race because a Hispanic touched you on the subway?
"juror no. five: At the moment, yes, sir, I am.”

The juror then also stated that she was troubled by what she felt to be the "manipulation” of a prosecution witness by defense counsel.

Focusing on the subway incident, the Trial Judge asked the juror to recognize what happened to her as an insult to her dignity and not as a racial incident, and to disassociate it from her decision on the guilt or innocence of defendant on the facts. The Trial Judge then explained:

"the court: You recognize that if you’re excused there’s a mistrial.
"juror no. five: I cannot make — because of the emotional factors, I cannot a decision. I can’t make a decision. I can’t go guilty or not guilty.
"the court: And you recognize the — after almost two days of deliberating all this goes down the drain.
"juror no. five: Well, yes, your Honor, I am aware of that, but I cannot—
"the court: I have no more alternates.
"juror no. five: Yes, I’m very much aware of that. But I can’t make a decision. I mean, because of emotional problems.”

Finally, the Trial Judge made one last effort to convince the juror that she should return to deliberations:

"the court: I ask you to try because the stakes are so high to abort the trial at this moment. It would be such — it would be an awesome thing to do to the defendant, number one, to go through the whole process again. It would be cruel.
"juror no. five: But I’m not sympathetic at the moment. It’s my opinion.
"the court: That’s just number one. New York State is bottled up with trials. They’re all waiting. Many lawyers are coming in and out. I couldn’t move for days because of this trial. They’re all bottled up.
"This thing has to go all over again. The pens are bottled up, all waiting to go to trial. All those things are at stake.” The Judge implied that, despite her bias, she was better than some of the other jurors:
"the court: And you don’t think that you could go in there and listen to the arguments to your fellow jurors? See, because let me tell you something. You know, don’t kid yourself. You’re not the only one who’s got a fight going on. Some tell and some don’t. Some tell and some don’t.
* * *
"And only thing about you, you are strong enough to come forth and say, ’Hey, I feel this.’ Others will perhaps conceal and — or shame, perhaps, to reveal it. You are most honest.”
In response, the juror finally stated ”[w]ell, I’ll try. I’ll try ”.

The juror then returned to the jury room. Defense counsel moved for a mistrial, and the motion was denied. Defendant was convicted, and defense counsel moved to set aside the verdict. A hearing was held on this latter motion, at which time the juror stated that she had voted to convict the defendant solely on the facts, and that she had put her bias aside. The trial court then denied defendant’s motion to set aside the verdict.

The constitutional right of a criminal defendant to a fair trial includes both the right to be tried by the jury in whose selection the defendant himself has participated, and the right to an impartial jury (see, NY Const, art I, §§ 6, 2; US Const 6th, 14th Amends; People v Buford, 69 NY2d 290, 298; People v Torpey, 63 NY2d 361, 365). To safeguard these rights the New York Legislature has provided for the defendant and the People to participate fully in the selection of the jury (CPL 270.05-270.25; see also, Batson v Kentucky, 476 US 79; People v Scott, 70 NY2d 420). To further protect the impartiality of the jury, the Legislature also has supplied a mechanism for a juror to be dismissed during the trial or during deliberations (CPL 270.35).

Specifically, CPL 270.35 states that if after the jury is sworn but before it renders a verdict the court finds that a juror is "grossly unqualified to serve”, that juror must be dismissed (see, People v Buford, 69 NY2d 290, 298, supra). Under that section, upon dismissal of a juror a mistrial must be declared if an alternate juror is not available. The Trial Judge generally is accorded latitude in making the findings necessary to determine whether a juror is grossly unqualified under CPL 270.35, because that Judge is in the best position to assess partiality in an allegedly biased juror (see, People v Michael, 48 NY2d 1, 10).

Recently, in People v Buford (supra), in the context of the discharge of a sitting juror over defendant’s objection, we set out guidelines for the trial court in making a determination under CPL 270.35. There we explained that the trial court should first conduct an in camera proceeding in the presence of the attorneys and defendant, with the attorneys participating if they so desire. We noted that this proceeding should be a "probing and tactful inquiry” into the "unique facts” of each case, including a careful consideration of the juror’s "answers and demeanor” (id., at 299).

We then held that a juror is grossly unqualified "only 'when it becomes obvious that [the] particular juror possesses a state of mind which would prevent the rendering of an impartial verdict’ ” (id., at 298, quoting People v West, 92 AD2d 620, 622 [Mahoney, P. J., dissenting], revd on dissenting opn below 62 NY2d 708; see also, People v Anderson, 70 NY2d 729, following People v Buford, supra; People v Cargill, 70 NY2d 687, 688, following People v Buford, supra). Thus in People v Buford (supra) we concluded that it was error for the trial court to have dismissed a sworn juror based on speculation from the juror’s equivocal responses (id.).

The case before us, however, is distinguishable from People v Buford (supra) in several important aspects. First, in determining that the jurors, in both People v Buford (supra) and its companion case, People v Smitherman, should not have been discharged as "grossly unqualified” under CPL 270.35 over defendants’ objections, we noted that the matters troubling the jurors were relatively insignificant and unlikely to affect their deliberations; and that, after the court explained that the jurors’ concerns were groundless, the jurors gave unambiguous assurances that they understood this and could deliberate fairly. Additionally, it is noteworthy that in Buford and Smitherman the prosecution sought discharge of a juror over defendant’s opposition, thus implicating defendant’s constitutional rights "to a trial by a 'particular jury chosen according to law, in whose selection [the defendant] has had a voice’ ” (People v Buford, supra, at 297-298, quoting People v Ivery, 96 AD2d 712, and People v West, 92 AD2d 620, 622 [Mahoney, P. J., dissenting], revd on dissenting opn below 62 NY2d 708, supra; see, NY Const, art I, § 2).

In contrast to the situation found in Buford and Smitherman, where minor incidents were involved and the question of the presence of bias was unclear at best, in the case before us the juror stated unequivocally that she was racially biased against Hispanics and was holding this against the Hispanic defendant. Thus, here we are not presented with equivocal indications of bias as we were in Buford and Smitherman; on the contrary, here the juror forthrightly expressed racial bias. Moreover, unsurprisingly, here it was the defendant who sought discharge of the juror in order to protect his right to be tried by an impartial jury.

We cannot accept the juror’s indications that she knew her bias was wrong, and her statement that she would "try” and deliberate as adequate assurances that the juror would put her bias aside and decide the case solely on the evidence. The construction of CPL 270.35 which affords the necessary constitutional protection is this: where, during the course of a trial, the court learns that a juror is racially or otherwise invidiously biased against the defendant due to an incident occurring after voir dire, the juror must be discharged as "grossly unqualified” unless (1) the trial court makes a determination on the record, following a probing and tactful inquiry with the juror, that the juror can render an impartial verdict according to the evidence and that her verdict will not be influenced by such bias; and (2) the trial court’s determination is supported in the record by the juror’s answers to the court’s questions including unequivocal assurance from the juror that he or she will decide the case solely on the evidence and free from any effect of the bias.

This case is not one in which the trial court was forced to "speculate as to possible partiality of the juror based on * * * equivocal responses” (see, People v Buford, supra, at 299). Instead, on this record the juror’s statements made it plain that she " 'possessed] a state of mind which would prevent the rendering of an impartial verdict’ ” (see, id., at 298). Despite the trial court’s inquiry, however, the juror gave no assurance that she would or could put her bias aside and reach a determination solely on the facts presented at trial. This juror should, therefore, have been dismissed as grossly unqualified to serve under CPL 270.35.

Finally, it is important to note that this court has repeatedly held that when a jury is deadlocked it is impermissible for the trial court to single out a particular juror when further instructing the jury (see, e.g., People v Carter, 40 NY2d 933; People v Pagan, 45 NY2d 725). Therefore, it was error for the trial court in the case before us to overemphasize to the one juror the fact that if her request to be dismissed was granted a costly mistrial, unfair to defendant and others, would be required.

Accordingly, the order of the Appellate Division should be reversed, and a new trial ordered.

Chief Judge Wachtler and Judges Simons, Kaye, Alexander, Titone, Hancock, Jr., and Bellacosa concur in Per Curiam opinion.

Order reversed, etc.

      . [2] Because we hold that the juror should have been determined to be "grossly unqualified to serve” after the discussion with the trial court during deliberations, we do not reach any question as to the propriety of the postverdict hearing. We note, however, that while the trial court has discretion to order a postverdict hearing on the presence of juror bias or misconduct and its affect on the jury’s decision, the required assiduous protection of the secrecy and sanctity of the jury’s deliberative process counsels that such a hearing not be undertaken except in extraordinary circumstances.

      . The jurors had expressed some concern over rather trivial matters — a juror in Buford seeing two prosecution witnesses leaving the courthouse together and wondering whether this was proper; another juror in Smitherman realizing that she had some knowledge of a collateral fact alluded to by a witness.


author: Titone, J. Kaye, J.

text:
    In the Matter of Marvin B. Kaplan et al., Appellants, v David S. Ritter, as Justice of the Extraordinary Special and Trial Term of the Supreme Court of the State of New York, et al., Respondents.
    Argued November 10, 1987;
    decided December 17, 1987

      POINTS OF COUNSEL

      Gerald B. Lefcourt, Joshua L. Dratel and Erica Horwitz for appellants.
    I. The New York State prosecution is barred by the New York State statutory double jeopardy framework embodied in CPL 40.10 and 40.20. (People v Abbamonte, 43 NY2d 74; People v Goodman, 69 NY2d 32; Matter of Abraham v Justices of N. Y Supreme Ct., 37 NY2d 560; People v Williams, 123 Misc 2d 165; People v Dorf, 77 Misc 2d 65; Braverman v United States, 317 US 49; Frohwerk v United States, 249 US 204; People v Ruiz, 130 Misc 2d 191; Marino v United States, 91 F2d 691; People v Ozarowski, 38 NY2d 481.) II. The State prosecution is barred by the Double Jeopardy Clauses of the New York State and Federal Constitutions. (Heath v Alabama, 474 US 82; North Carolina v Pearce, 395 US 711; Matter of Auer v Smith, 77 AD2d 172; Matter of Johnson v Morgenthau, 69 NY2d 148; Abney v United States, 431 US 651; Matter of Cirillo v Justices of Supreme Ct., 43 AD2d 4; People v Williams, 123 Misc 2d 165; Matter of De Canzio v Kennedy, 67 AD2d 111, 47 NY2d 709; Ashe v Swenson, 397 US 436; Matter of Cardin v Sedita, 53 AD2d 253.)

      Robert M. Pitler and Mary C. Farrington for Robert M. Morgenthau, respondent.
    I. Under CPL 40.20 (2) (e) the State may prosecute the investor larceny counts and the securities fraud counts because those counts involve losses to victims different from those involved in the Federal prosecution. (People v Rivera, 60 NY2d 110; People v Abbamonte, 43 NY2d 74; People v Luongo, 47 NY2d 418; Matter of Cirillo v Justices of Supreme Ct., 43 AD2d 4, 34 NY2d 990; People v Acevedo, 69 NY2d 478; People v Goodman, 69 NY2d 32; Matter of Wiley v Altman, 52 NY2d 410; People v Graham, 55 NY2d 144; People v Bayron, 66 NY2d 77; Allen v Minskoff, 38 NY2d 506.) II. Under the doctrine of "dual sovereignties” New York can prosecute the same offense which has been previously prosecuted by the Federal Government without violating the constitutional ban against double jeopardy. (Brown v Ohio, 432 US 161; Matter of Johnson v Morgenthau, 69 NY2d 148; People v Prescott, 66 NY2d 216; People v Rivera, 60 NY2d 110; People v Lo Cicero, 14 NY2d 374; Moore v Illinois, 14 How [55 US] 13; United States v Lanza, 260 US 377; Bartkus v Illinois, 359 US 121; Abbate v United States, 359 US 187; United States v Wheeler, 435 US 313.)
   OPINION OF THE COURT

Titone, J.

Having been tried and convicted in Federal court of various racketeering, conspiracy and fraud counts, petitioners now seek to prohibit the New York County District Attorney from trying them on charges of larceny and securities fraud arising from the same transaction. Their appeal from the judgment below denying them such relief requires us to consider the scope and proper application of CPL 40.20 (2) (e), which establishes an exception to the general statutory rule against successive prosecutions where "[e]ach offense involves death, injury, loss or other consequence to a different victim”. We hold that this exception is available only where each of the offenses in the separate prosecutions involves one or more specific, individually identifiable victims. Accordingly, where, as here, the accuseds have previously been tried and convicted on Federal conspiracy, racketeering and fraud charges, all of which were based on a bribery scheme having no specifically identifiable victims, the "different victim” exception of CPL 40.20 (2) (e) cannot be invoked to justify a separate prosecution for State larceny and securities fraud arising from the same bribery scheme.

At the time the events leading to the charged acts of bribery took place, petitioner Stanley Friedman was the Chairman of the Bronx Democratic Party and petitioner Marvin Kaplan, Friedman’s friend, was a businessman involved with several data processing concerns, one of which had previously obtained a contract with the New York City Parking Violations Bureau (PVB). In 1982, according to prosecution allegations, petitioners bribed one Geoffrey Lindenauer, who was then the Deputy Director of the PVB, and the late Donald Manes, the former Queens Borough President and political leader with reputed city-wide influence. The object of the bribe was to ensure that, Citisource, Inc., a corporation owned by petitioners, would be awarded a lucrative PVB contract for the development and production of a hand-held computerized device for issuing parking summonses.

The alleged bribe to Manes and Lindenauer purportedly took the form of Citisource stock, which was to be held secretly in petitioner Friedman’s name in order to conceal the illegal bribe transaction and Lindenauer’s patent conflict of interest. The PVB contract was, in fact, subsequently awarded to Citisource. Shortly thereafter, the corporation, which had no other assets, made a public stock offering. Of course, neither the bribe to Lindenauer and Manes nor the surreptitious retention by Friedman of the Citisource shares that had been issued to Manes and Lindenauer was disclosed in the offering statement.

As a result of a subsequent investigation, the bribe leading to the awarding of the PVB contract was eventually uncovered. In the wake of the ensuing publicity, petitioners Friedman and Kaplan were indicted — within a two-week period — by Grand Juries for both New York County and the United States District Court for the Southern District of New York. These indictments were evidently the products of extensive cooperation among prosecutors at the county, State and Federal levels.

The 41-page Federal indictment charged petitioners with, among other crimes, violating the Racketeer Influenced and Corrupt Organizations Act (RICO) (18 USC § 1961 et seq.) by "transforming] the PVB from a public agency * * * into a vehicle for the corrupt profit of county leaders, public officials, private businesses and private businessmen.” Among the means by which this "transformation” was allegedly effected was the bribe paid to Lindenauer and Manes to secure the PVB contract for Citisource. Additionally, petitioners were charged with conspiracy to violate RICO (see, 18 USC § 1962 [d]; see also, § 1962 [c]) and mail fraud (see, 18 USC § 1341), accomplished by sending certain false and fraudulent documents in connection with the PVB-Citisource contract through the United States Postal Service. The alleged object of the latter charge was "to defraud the * * * citizens of the City of their right to the honest and loyal services of Manes, Lindenauer and * * * their right to have the business and affairs of the City * * * and the PVB conducted honestly and free from fraud, corruption and the illegal receipt of bribes.”

The 34-page, 27-count New York County indictment, in contrast, charged petitioners with violating the antitrust provisions of the Donnelly Act (General Business Law § 340), violating the securities fraud provisions of the Martin Act (General Business Law § 352-c) and committing the crimes of second degree grand larceny (Penal Law § 155.35 [now § 155.40]) and second degree bribery (Penal Law § 200.00 [now § 200.03]). A count of conspiracy to commit the crimes of grand larceny, securities fraud and offering a false instrument for filing (see, Penal Law § 105.05) and a separate count of second degree bribe receiving (Penal Law § 200.10 [now §200.11]) against Friedman alone were also stated in the indictment. The factual basis for each of these charges included, as an essential component, the bribe to Manes and Lindenauer and the resulting corruption of the process through which the PVB contract was awarded to Citisource. The securities fraud and larceny counts were predicated specifically on petitioners’ failure to disclose the bribe transaction in the Citisource stock prospectus, resulting in the defrauding of "members of the public” and financial loss to specific named investors.

After extensive discussions among the local and Federal prosecutors and the Judges handling the respective cases, it was determined, over objection by the New York County District Attorney, that the Federal trial would proceed first. Conducted between September 22 and November 25, 1986, the Federal trial terminated in a conviction against petitioner Friedman for mail fraud and RICO violations and a conviction against petitioner Kaplan for those crimes as well as the crime of perjury. On March 11, 1987, Friedman was sentenced to 12 years’ imprisonment and five years’ probation; Kaplan was sentenced to four years’ imprisonment and was fined $250,000.

Following the Federal trial, petitioners commenced the present article 78 proceeding seeking an order prohibiting further prosecution under the New York County indictment (see, e.g., Matter of Abraham v Justices of N Y. Supreme Ct., 37 NY2d 560, 564 [prohibition lies to challenge successive prosecution under CPL 40.20]). Contending that the charges arose out of the same transaction as formed the basis of the counts in the Federal indictment, petitioners argued that separate prosecution would violate their constitutional and statutory double jeopardy rights. In response, the New York County District Attorney conceded that prosecution of seven of the counts in the New York County indictment — conspiracy, larceny from New York City (two counts), bribery and bribe receiving (four counts) — was precluded under the statutory scheme. However, he argued that prosecution of the securities fraud and larceny counts was permissible because those charges and the Federal counts did not arise from the same transaction. Additionally, he argued that each of the 20 remaining counts were separately prosecutable because even if they had arisen from the same transaction, they also fell within various exceptions to the statutory rule prohibiting successive prosecution.

After hearing oral argument on the petition, the Appellate Division accepted the District Attorney’s concession and, in addition, prohibited prosecution of the Donnelly Act antitrust counts, reasoning that the Federal RICO claims "encompass[ed]” the wrongs with which those counts were concerned. The court, however, denied petitioners’ request for a writ of prohibition with respect to the charges alleging fraud in the sale of securities (3 counts) and grand larceny from named investors (15 counts). Citing CPL 40.20 (2) (e), the court stated in connection with these charges that "[n]one of the individuals or organizations to which the securities were sold is mentioned in the Federal indictment” and that "[a]n ordinary 'Blue Sky’ contention is not included in a 'RICO’ prosecution.” (131 AD2d, at 399.) Petitioners then appealed by permission of this court.

On this appeal, respondent District Attorney has abandoned his argument that the pending securities fraud and grand larceny counts do not arise out of the same transaction as the Federal RICO counts. Further, the District Attorney has expressly relinquished any reliance he might previously have placed on the other statutory exceptions and has instead concentrated his arguments principally on CPL 40.20 (2) (e), which permits separate prosecution for offenses arising out of the same transaction where the prosecutions involve loss or injury to different victims. Finally, no reliance has been placed on CPL 40.20 (2) (h) (enacted L 1986, ch 516), which establishes a new exception where one of the offenses to be separately prosecuted is "enterprise corruption” (see, Penal Law § 460.20) or "racketeering” in violation of Federal law. This new law, effective November 1, 1986, is not applicable to the present case because the Federal prosecution in issue was commenced before that date.

Thus narrowed, the District Attorney’s argument is, in essence, that the Federal charges all focused upon the allegations of bribery and corruption of governmental agencies through a pattern of "racketeering.” Even the mail fraud charge, as the District Attorney notes, concerned the use of the Federal mail system to defraud the City of New York. The victims of these crimes, according to the District Attorney, were the citizens and taxpayers of New York City, who had a right to honest decision making by their public officials and were deprived of that right by petitioners’ unlawful machinations. In contrast, the victims of the remaining counts in the New York County indictment — securities fraud and grand larceny — were the investing public at large and the named individual investors who lost money as a result of petitioners’ failure to disclose the bribe transaction. Inasmuch as the Federal and local indictments concern two entirely separate classes of victims, the District Attorney argues, separate prosecution is not statutorily barred (see, CPL 40.20 [2] [e]).

We conclude, however, that the exception provided in CPL 40.20 (2) (e) for offenses involving different victims has no application in this situation. Prior cases in which the "different victim” exception was successfully invoked have all involved successive prosecutions for offenses that arose from the same transaction but caused loss or injury to separate, individually identifiable persons or entities (see, e.g., People v Luongo, 47 NY2d 418; People v Dean, 56 AD2d 242, affd 45 NY2d 651; Matter of Carney v Leary, 106 AD2d 176; see also, People v Rodgers, 184 App Div 461, affd 226 NY 671). In petitioners’ case, in contrast, the Federal RICO, conspiracy and mail fraud counts, which all related to the corrupting effect of official bribery, have no specific, individually identifiable victims. Rather, as is apparent from the District Attorney’s own argument, the "victims” of those Federal crimes may be defined only by reference to a general class of individuals— citizens and taxpayers of New York City — who were in a position to be wronged by the corruption of New York City officials.

To permit application of the CPL 40.20 (2) (e) "different victim” exception in these circumstances would be to distort the carefully crafted statutory double jeopardy scheme. Virtually any criminal act may be described either in terms of the evil or harm that the relevant penal legislation was designed to prevent or in terms of a general category of "victims” corresponding roughly to that evil or harm. Thus, if the "different victim” exception were construed to encompass cases involving different classes of victims, as the District Attorney here urges, it would, in effect, substantially overlap with the entirely distinct statutory exception that applies when "[e]ach of the offenses as defined contains an element which is not an element of the other, and the statutory provisions defining such offenses are designed to prevent very different kinds of harm or evil” (CPL 40.20 [2] [b]).

Such a result is not acceptable in this context. Each of the statutory exceptions to the general rule proscribing successive prosecution for offenses arising from the same transaction was drafted to address a particular situation in which the statutory prohibition was deemed overly broad (see, People v Rivera, 60 NY2d 110, 114). The "different harm or evil” exception, which is potentially quite broad, has been legislatively narrowed by the requirements, not applicable to the "different victim” exception, that each crime have at least one element not shared by the other and that the "harm or evil” to be addressed by the separate prosecutions be analyzed by reference to the "statutory provisions defining such offenses” rather than to the particular criminal acts charged. Given this important distinction between the exceptions prescribed in CPL 40.20 (2) (b) and 40.20 (2) (e), an interpretation of the latter that would permit the exceptions to be used in a virtually interchangeable manner could well lend itself to unilateral evasion by the very entity that the Legislature sought to regulate by enacting a statutory double jeopardy protection for those accused of crimes.

In this case, for example, the District Attorney has understandably chosen to abandon an argument he made in the courts below that separate prosecution of the State securities fraud and larceny charges may be justified under the "different evil” exception to the statutory double jeopardy rule. Yet, the argument he now makes — that the prosecution is maintainable under the "different victim” exception — is essentially the same. In effect, the District Attorney has attempted to invoke the "different victim” exception of CPL 40.20 (2) (e) by simply recasting the harm or evil that was the object of the particular Federal RICO-fraud prosecution — the corruption of government and the consequent distortion of government’s purposes — in language that focuses on the ultimate victims of such conduct — the citizens of the affected governmental entity. The net result of this facile argument, however, is the circumvention of the more demanding requirements of CPL 40.20 (2) (b), which looks not to the evil toward which the particular prior prosecution was directed, but rather to the broader evil to which the penal statute in question was addressed. Such an outcome is unacceptable and demonstrates vividly why we must reject the application of CPL 40.20 (2) (e) that the District Attorney urges.

To summarize, we hold that the "different victim” exception specified in CPL 40.20 (2) (e) is available only when all of the offenses included in a prior prosecution involved specific, individually identifiable victims and the second prosecution arising from the same transaction involves other individual victims (see, e.g., People v Luongo, supra). In instances where, because of either the nature of the offense or the nature of the specific criminal acts charged, identification of a specific victim is not feasible, separate prosecution may be justified only if the conditions in one of the other statutory exceptions, such as CPL 40.20 (2) (b), are fully satisfied. As applied to this case, these principles lead to the conclusion that the remaining counts in the New York County indictment, which charge petitioners with securities fraud and grand larceny, cannot be prosecuted in light of the prior Federal prosecution for RICO violations and fraud. Because the latter prosecution did not involve specific, individual victims, the exception set forth in CPL 40.20 (2) (e) is unavailable and the general rule prohibiting separate prosecution of offenses arising from the same transaction is controlling.

In light of our decision on the proper application of the statutory double jeopardy provisions, we need not consider petitioners’ other arguments addressed to the State and Federal constitutional double jeopardy proscriptions (US Const 5th, 14th Amends; NY Const, art I, § 6). Accordingly, the judgment of the Appellate Division, insofar as appealed from, should be reversed, with costs, and the petition granted in its entirety.

Kaye, J.

(concurring). The prosecution here has not met its burden of showing that the victims of the crimes alleged in the State indictment are different from the victims of the offenses that were the subject of the Federal indictment. I therefore agree with the court’s conclusion that the double jeopardy exception recognized by CPL 40.20 (2) (e) for prosecutions involving "loss or other consequence to a different victim” is inapplicable to this case. I cannot, however, agree with the rationale that CPL 40.20 (2) (e) must be limited to cases where “all of the offenses included in a prior prosecution involved specific, individually identifiable victims and the second prosecution arising from the same transaction involves other individual victims”. (Majority opn, at 230; also, at 224,230.) My disagreement has two bases.

First, the rationale is broader than necessary to resolve this case. Here, the Federal indictment charges racketeering and mail fraud involving both Citisource stock and bribery of certain public officers, where the public at large — and particularly the citizens of New York City — are the alleged victims. The State indictment, concededly based on the "same transaction” (CPL 40.20 [2]) involving both Citisource stock and bribery of the same public officers, identifies as defendants’ victims "members of the public” as well as named individual purchasers of Citisource stock. The District Attorney insists that different interests are being vindicated by the State prosecution, but the statutory exception into which he seeks to fit this case is not for a different harm or evil (CPL 40.20 [2] [b]) but for an actual "different victim” (CPL 40.20 [2] [e]). That requirement is plainly not satisfied. One can only conclude from reading the indictment that the members of the public whose interests are sought to be vindicated by the Federal prosecution must be the very same victims, the very same members of the public — which necessarily includes the particular named individual purchasers of Citisource stock— whose interests are also the subject of the State prosecution. My first disagreement with the court’s rationale, therefore, is that it goes beyond what is necessary to resolve the case before us.

Second, I see no present basis for limiting the "different victim” exception to prosecutions where there are "specific, individually identifiable victims.” (Majority opn, at 224.) As CPL 40.20 (2) (e) is now construed, unless the first prosecution involves "specific, individually identifiable” victims a second prosecution on the same transaction cannot go forward under the "different victim” exception even though it involves a different group or class of victims or even different individuals. Nothing in the statute itself, or its history, or the case law is cited as support for that limitation. It may well be that interpreting CPL 40.20 (2) (e) also to encompass wholly different groups or classes of victims will in a future case show itself to be erroneous; it may well be that such an interpretation would facilitate manipulation and undermine the entire purpose of the section. But we cannot and do not know that now.

Chief Judge Wachtler and Judges Alexander, Hancock, Jr., and Bellacosa concur with Judge Titone; Judge Kaye concurs in result in a separate opinion in which Judge Simons concurs.

Judgment, insofar as appealed from, reversed, etc.

      . Following the issuance of the New York County indictment, the District Attorney of that county also commenced a civil forfeiture action, under article 13-A of the CPLR, against Friedman, Kaplan and Citisource. The propriety of the provisional relief afforded the District Attorney in that action was considered in Morgenthau v Citisource, Inc. (68 NY2d 211).

      . In addition to the RICO, conspiracy and mail fraud counts, petitioner Kaplan was charged with one count of perjury for his alleged dishonesty before the Securities Exchange Commission (18 USC § 1621).

      . The aspect of the conspiracy count relating to the crime of offering a false instrument for filing (see, Penal Law § 175.35) referred to a separate substantive count in the indictment that was asserted only against a codefendant, Martin Solomon.

      . It is clear that the Federal RICO statutes under which petitioners were prosecuted were "designed to prevent” the enhanced evil and societal harm that occurs when criminal activities, of many types, are conducted in organized form (see, e.g., United States v Turkette, 452 US 576, 588-590; Preamble, Organized Crime Control Act of 1970, 84 US Stat 922-923). Such criminal activities as securities fraud and theft conducted through legitimate and illegitimate organizations were plainly contemplated. In fact "harm to investors” was one of the targeted evils specifically mentioned when the legislation was enacted (see, 84 US Stat 922). Thus, even though the elements of the previously prosecuted Federal RICO crimes may differ from those of the State securities fraud and larceny crimes that the District Attorney now wishes to pursue, it can hardly be said that the underlying penal statutes were aimed at "very different kinds of harm or evil” within the meaning of CPL 40.20 (2) (b) (see, Matter of Abraham v Justices of N. Y Supreme Ct., 37 NY2d 560, 567).