author: Cooke, J.

text:
    Beverly J. Allen, Individually and as Administratrix of the Estate of Edward P. Allen, Jr., Deceased, Respondent, v Cloutier Construction Corp. et al., Appellants, and J. Ellrott Excavating Contractor, Inc., Respondent. Richard W. Myers, as Administrator of the Estate of Jay B. Myers, Deceased, Respondent, v Cornell University, Defendant-Appellant and Third-Party Plaintiff-Respondent. A. Friederich & Sons Co., Inc., Third-Party Defendant-Appellant.
    Argued March 30, 1978;
    decided May 2, 1978

      POINTS OF COUNSEL

      Raymond C. Green, Peter M. Pryor and Andrew F. Capoccia for Cloutier Construction Corp., appellant in the first above-entitled action.
    I. The 1969 amendment of section 241 of the Labor Law was not intended to and did not serve to impose duties upon the owner of a residence under construction toward a general contractor’s employee or subcontractor with respect to areas, operations, instrumentalities or activities belonging to and within the control of the general contractor or one of its subcontractors, which were neither in the owner’s control or supervision nor furnished by the owner for use in common by the general contractor, its subcontractors and their employees. (Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Kappel v Fisher Bros., 6th Ave. Corp., 39 NY2d 1039; Wright v Belt Assoc., 14 NY2d 129; Naso v Wates & Co., 15 NY2d 667; Bidetto v New York City Housing Auth., 25 NY2d 848; Persichilli v Triborough Bridge & Tunnel Auth., 16 NY2d 136; Conte v Large Scale Dev. Corp., 10 NY2d 20; Rusin v Jackson Hgts. Center, 27 NY2d 103; Rooney v Brogan Constr. Co., 194 NY 32; Lotocka v Elevator Supplies Co., 246 NY 295.) II. If section 241 (subd 6) of the Labor Law is a liability statute which is designed to hold owners and general contractors who are without culpability vicariously liable for what is actually the culpability of others, sections 11 and 29 (subd 6) of the Workmen’s Compensation Law, its exclusive remedy provisions, prohibit the imposition of any such liabilities, if the others actually at fault are the employer or fellow employees of injured workmen and the employer has secured the payment of workmen’s compensation benefits in accordance with the provisions of the Workmen’s Compensation Law. (Kelly v Diesel Constr. Div. of Carl A. Morse, Inc., 35 NY2d 1; Plath v Justus, 28 NY2d 16; Naso v Lafata, 4 NY2d 585; Rauch v Jones, 4 NY2d 592; Castle v North End Contr. Corp., 21 AD2d 8; Di Bernardo v Heimroth, 58 AD2d 344; Matter of Lippman v Biennier Transp. Co., 12 AD2d 681, 10 NY2d 757; Matuszak v City of New York, 8 AD2d 976; Williams v

      Hartshorn, 296 NY 49; Boyle v Cheney Piano Action Co., 193 App Div 408.)

      Dale M. Thuillez and Thomas A. Ford for Philip J. Sgarlata and another, appellants in the first above-entitled action.
    I. There was no breach of the nondelegable duty imposed by sections 240 and 241 of the Labor Law as amended by the laws of 1969 by the owner Sgarlata who exercised no direction or control of the work performed by the contractor and subcontractors. (Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Freeo v Victor A. Perosi, Inc., 54 AD2d 684; Tilkins v City of Niagara Falls, 52 AD2d 306; Komar v Dun & Bradstreet Co., 284 App Div 538; Thomas v New York City Housing Auth., 28 Misc 2d 289, 8 AD2d 789, 9 NY2d 625; Curtis v State of New York, 27 AD2d 628, 23 NY2d 976; Kappel v Fisher Bros., 6th Ave. Corp., 39 NY2d 1039.) II. The right of the owners, Sgarlatas, to indemnification from plaintiff subcontractor grants an absolute defense to the Sgarlatas. (Kelly v Diesel Constr. Div. of Carl A. Morse, Inc., 35 NY2d 1.)

      Daniel R. Santola, Morris J. Bloomberg and Philip G. Jupiter for Beverly J. Allen, respondent in the first above-entitled action.
    I. Sections 240 and 241 of the Labor Law impose a nondelegable duty upon all owners and contractors, whether or not they exercise direction or control over the work or construction site. (Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Kappel v Fisher Bros., 6th Ave. Corp., 39 NY2d 1039; Kelly v Diesel Constr. Div. of Carl A. Morse, Inc., 35 NY2d 1; Bidetto v New York City Housing Auth., 25 NY2d 848; Persichilli v Triborough Bridge & Tunnel Auth., 16 NY2d 136; Haskins v City of New York, 28 AD2d 656; Horan v Dormitory Auth., 43 AD2d 65; Rocha v State of New York, 45 AD2d 633, 36 NY2d 642; Myers v Cornell Univ., 46 AD2d 839; Freeo v Victor A. Perosi, Inc., 54 AD2d 684.) II. The right of the owners, Sgarlatas, to indemnification does not grant them an absolute defense against plaintiff. (Koenig v Patrick Constr. Corp., 298 NY 313.)

      David F. Kunz for J. Ellrott Excavating Contractor, Inc., respondent in the first above-entitled action.
    I. Sections 240 and 241 of the Labor Law impose nondelegable duties on owners and general contractors that do not require their control or direction of the worksite. (Write v Belt Assoc., 14 NY2d 129; Conte v Large Scale Dev. Corp., 10 NY2d 20; Mount v Mitchell, 31 NY 356, 32 NY 702; People ex rel.

      Lehigh & N. Y. R. R. Co. v Sohmer, 217 NY 443, 218 NY 632; Rocha v State of New York, 45 AD2d 633, 36 NY2d 642; Myers v Cornell Univ., 46 AD2d 839; Tilkins v City of Niagara Falls, 52 AD2d 306; Scavone v State Univ. Constr. Fund, 46 AD2d 895; Persichilli v Triborough Bridge & Tunnel Auth., 16 NY2d 136; Wright v Belt Assoc., 14 NY2d 129.) II. The motion for summary judgment cannot be granted because fact issues exist. (Catapano v Impressive Homes, 19 AD2d 532; Ithaca Trust Co. v Driscoll Bros. & Co., 220 NY 617.)

      Robert H. Reeder for defendant-appellant and third-party plaintiff-respondent in the second above-entitled action.
    I. Prior to 1969 there was no liability on the part of an owner under section 241 of the Labor Law to injured employees of contractors where the owner did not direct, control or supervise the work. (Wright v Belt Assoc., 14 NY2d 129; Campoli v Endicott Constr. Servs., 21 AD2d 947; Curtis v State of New York, 23 NY2d 976.) II. The 1969 amendment to section 241 of the Labor Law did not impose any new duties upon an owner. (Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Tilkins v City of Niagara Falls, 52 AD2d 306; Naso vLafata, 4 NY2d 585.)

      M. Bates Davidson for respondent in the second above-entitled action.
    I. The courts have heretofore erroneously read into section 241 a requirement that the owner have control before liability will attach. (Wright v Belt Assoc., 14 NY2d 129; Thomas v New York City Housing Auth., 9 NY2d 625; Conte v Large Scale Dev. Corp., 10 NY2d 20; Curtis v State of New York, 23 NY2d 976.) II. Section 241 of the Labor Law as amended in 1969 imposes an absolute nondelegable duty on owners and general contractors. (Scavone v State Univ. Constr. Fund, 46 AD2d 895; Freeo v Victor A. Petrosi, Inc., 54 AD2d 684; Tilkins v City of Niagara Falls, 52 AD2d 306; Myers v Cornell Univ., 46 AD2d 839; Allen v Cloutier Constr. Corp., 56 AD2d 348; Haimes v New York Tel. Co., 59 AD2d 813; Kappel v Fisher Bros., 6th Ave. Corp., 49 AD2d 578; Washington v East 87th & 88th St. Contr. Co., 90 Misc 2d 911; Kelly v Diesel Constr. Div. of Carl A. Morse, Inc., 35 NY2d 1; Horan v Dormitory Auth., 43 AD2d 65.) III. Imposing an absolute nondelegable duty on an owner pursuant to section 241 would not cause undue hardship. (Basso v Miller, 40 NY2d 233; Scurti v City of New York, 40 NY2d 433; Naso v Lafata, 4 NY2d 585; Dole v Dow Chem. Co., 30 NY2d 143.)

      Manley H. Thaler for third-party appellant-defendant in the second above-entitled action.
    I. Section 241 of the Labor Law, as presently worded, creates no duty or liability on the owner of premises who is not in possession or control of the work site. (Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Tallarico v Long Is. Light. Co., 45 AD2d 845, 38 NY2d 733; Tilkins v City of Niagara Falls, 52 AD2d 306; Scavone v State Univ. Constr. Fund, 46 AD2d 895; Rocha v State of New York, 45 AD2d 633, 36 NY2d 642; Horan v Dormitory Auth., 43 AD2d 65; Myers v Cornell Univ., 46 AD2d 839; Allen v Cloutier Constr. Corp., 56 AD2d 348; Haimes v New York Tel. Co., 59 AD2d 813.) II. The present case law applicable to construction site accidents has spawned a myriad of interpretive decisions. (Naso v Wates & Co., 15 NY2d 667; Wright v Belt Assoc., 14 NY2d 129; Kelly v Diesel Constr, Div. of Carl A. Morse, Inc., 35 NY2d 1; Rock v Reed-Prentice Div. of Package Mach. Co., 39 NY2d 34; Dole v Dow Chem. Co., 30 NY2d 143; Iuliani v Great Neck Sewer Dist., 38 NY2d 885; Kappel v Fisher Bros., 6th Ave. Corp., 39 NY2d 1039; Naso v Lafata, 4 NY2d 585; Castle v North End Constr. Corp., 21 AD2d 8.) III. The Workmen’s Compensation Law is the sole and exclusive remedy of an injured employee. The remedy is exclusive to the extent of prohibiting indemnification actions, apportionment actions, vicarious liability actions, all as maintained by third parties against the employer. (Powers v Porcelain Insulator Corp., 285 NY 54; O’Rourke v Long, 41 NY2d 219; Koutrakos v Long Is. Coll. Hosp., 47 AD2d 500; Clements v Rockefeller, 189 Misc 885; Putvin v Buffalo Elec. Co., 5 NY2d 447; Dole v Dow Chem. Co., 30 NY2d 143; Kelly v Long Is. Light. Co., 31 NY2d 25; Rogers v Dorchester Assoc., 32 NY2d 553; Barry v Niagara Frontier Tr. System, 35 NY2d 629; Greenberg v City of Yonkers, 37 NY2d 907.) IV. (A) The contractual indemnity between Cornell and Friederich supplants any common-law indemnity rights which might otherwise have existed between them; and in any event, the contractual obligation to indemnify is paramount and primary and resort to common-law indemnity may be had only if the right to actual recovery of contractual indemnity proves fruitless. (B) Furthermore, if the 1969 amendment of section 241 did indeed intend to overturn that which pre-existed, one of its intents was to restore the rule of law that an owner held liable under section 241 has no common-law recourse over against another, its sole recourse over being by way of a contractual right to indemnity, if one exists. (Schroeder v Braun & Co., 502 F2d 235; Rogers v

      Dorchester Assoc., 32 NY2d 553; Haman v Humble Oil & Refining Co., 34 NY2d 557; Williams v D.A.H. Constr. Corp., 42 AD2d 877; Hogeland v Sibley, Lindsay & Curr Co., 42 NY2d 153; Rocha v State of New York, 45 AD2d 633; Feller v Sano-Rubin Constr. Co., 82 Misc 2d 890; United States Steel Corp. v Hartford Acc. & Ind. Co., 511 F2d 96; Fenner v Continental Diving Serv., 543 F2d 1113; Lopes v Rostad, 56 AD2d 645.) V. The contractual indemnity insurance does not apply to claims of indemnitors’ own employee; common-law indemnity only being applicable, if at all, in such claims. (Hogeland v Sibley, Lindsay & Curr Co., 42 NY2d 153.)
   OPINION OF THE COURT

Cooke, J.

Both of these appeals arise out of construction site accidents involving workmen killed as a result of the collapse of excavation trenches. Actions were commenced against the respective owners upon whose property the accidents occurred, notwithstanding that the actual work was at all times performed and directed by others. The issue presented in each case is whether an owner or general contractor may be held to answer for the damages suffered by a workman as a result of a violation of subdivision 6 of section 241 of the Labor Law absent a showing that they controlled, directed or supervised the work site. The Appellate Division held that the 1969 amendment to section 241 (L 1969, ch 1108, § 3, eff July 25, 1969) imposed liability on an owner even in the absence of control and direction of the work being performed by subcontractors. We affirm.

Defendants Philip and Patricia Sgarlata engaged the Cloutier Construction Corp. for the erection of a home on their land in the Town of Colonie. Cloutier in turn subcontracted the plumbing and heating work to Edward Allen. On August 17, 1973, the walls of a trench in which Allen was installing a sewer line caved in, causing injuries from which he subsequently died. An action for wrongful death and conscious pain and suffering was commenced by his estate representative against the Sgarlatas, as owners, Cloutier, as contractor, and the J. Ellrott Excavating Contractor, Inc., the lessor and operator of the equipment which had dug the trench. Each defendant answered and cross-claimed against the others. The Sgarlatas and Cloutier moved for summary judgment dismissing the complaint on the ground that an owner and general contractor owe no duty to a subcontractor in the absence of any control or supervision over the subcontractor’s work.

Defendant Cornell University, the owner of property on its campus at Ithaca, contracted with third-party defendant A. Friederich & Sons Co., Inc., to erect an addition to the Wilson Synchrotron Laboratory. On November 19, 1971, employees of Friederich, one of whom was Jay B. Myers, were engaged in breaking concrete out of an old foundation so that a new footing and wall might be installed. An earthen embankment gave way and collapsed into the trench in which Myers was working causing his death. Cornell moved for summary judgment dismissing the complaint on the ground that it had no direct control over the performance of the work and that the area involved was not a common work area.

Plaintiffs in both cases predicate the owners’ liability on the post-1969 terms of subdivision 6 of section 241 of the Labor Law. The statute presently provides:

"All contractors and owners and their agents, when constructing or demolishing buildings or doing any excavating in connection therewith, shall comply with the folldwing requirements: * * *
"6. All areas in which construction, excavation or demolition work is being performed shall be so constructed, shored, equipped, guarded, arranged, operated and conducted as to provide reasonable and adequate protection and safety to the persons employed therein or lawfully frequenting such places. The board may make rules to carry into effect the provisions of this subdivision, and the owners and contractors and their agents for such work shall comply therewith” (L 1969, ch 1108, § 3).

To determine whether liability may be imposed on a non-controlling owner pursuant to section 241, it is necessary to trace the long, and somewhat checkered, history of the statute, as well as its relationship to other worker safety legislation. Prior to 1962, section 241 was essentially identical to the present statute, although it contained no counterpart to the present subdivision 6 with respect to shoring excavation work. That statute (L 1909, ch 36, § 20, as amd by L 1911, ch 693; L 1913, ch 492; L 1919, ch 545, § 2), consisted of seven subdivisions, the first five of which contained specific, positive commands to all contractors and owners to provide protection deemed appropriate by the Legislature in connection with the construction or demolition of buildings or any excavation in connection therewith. The duty imposed upon owners and general contractors by these subdivisions was "a flat and unvarying” one (Koenig v Patrick Constr. Co., 298 NY 313, 318), rendering them liable for a violation of their proscriptions even though the actual work might have been performed by an independent contractor (Semanchuck v Fifth Ave. & 37th St. Corp., 290 NY 412, 419; Bruno v Almar Residences Corp., 13 AD2d 232, 236, affd 11 NY2d 988). This nondelegable duty was made designedly broad to reach those who were thought to have the over-all responsibility for the construction of a building in which the Legislature deemed a particular employment inherently hazardous, irrespective of fault and despite lack of control. Thus, a violation of any of these five subdivisions, causing injury to a member of the protected class was held to have imposed absolute, first instance liability upon an owner or general contractor unrelated to questions of negligence (Joyce v Rumsey Realty Corp., 17 NY2d 118, 122; Walters v Rao Elec. Equip. Co., 289 NY 57, 61; Berla v Zambetti, 235 App Div 464, 465; cf. Haskins v City of New York, 28 AD2d 656, 657).

Subdivisions 6 and 7 of the pre-1962 version of section 241 proceeded on a different basis. These were the rule-making subdivisions, and provided generally that the Board of Standards and Appeals might make rules for the protection of workmen. Whereas a violation of any of the first five subdivisions gave rise to absolute liability, a violation of the administrative rules promulgated pursuant to subdivisions 6 and 7 " 'was simply some evidence of negligence which the jury could take into consideration with all the other evidence bearing on that subject’ ” (Conte v Large Scale Dev. Corp., 10 NY2d 20, 29, quoting Schumer v Caplin, 241 NY 346, 351). This disparity as to the effect of violations was based on the well-recognized principle that there is a clear distinction between the effect of a violation of an administrative regulation promulgated pursuant to statute, and a violation of a substantive provision of the statute itself (Bergen v East 84th St. Constr. Co., 16 NY2d 644; Prosser, Torts [4th ed], § 36, pp 197-198).

In 1962, the Legislature amended section 241 (L 1962, ch 450, § 3, eff Oct. 1, 1962), and substituted in place of the prior seven subdivisions, one paragraph which set forth general duties as to work operations for owners, general contractors and, for the first time, subcontractors to provide "reasonable and adequate protection and safety to the persons employed [in the construction, demolition or excavation of a building] or [persons] lawfully frequenting such places.” This 1962 revision delegated the authority to make specific rules and regulations to administer the statute to the Board of Standards and Appeals. Moreover, the amended statute was devoid of any specific directions normally contained in statutes imposing absolute liability and, hence, a violation of the rules promulgated thereunder resulting in the injury of a member of the protected class was properly held to be merely some evidence of negligence on the part of some person (see Wright v Belt Assoc., 14 NY2d 129, 135).

In effect, then, a violation of these rules was simply a breach of the common-law duty, later codified (see Labor Law, § 200), of an owner or general contractor to provide a safe place to work to workmen on the construction site (see Iuliani v Great Neck Sewer Dist., 38 NY2d 885, 886; Rusin v Jackson Hgts. Shopping Center, 27 NY2d 103, mot for rearg den 27 NY2d 817). Since it was "well settled that the duty to provide a safe place to work is not breached when the injury arises out of a defect in the subcontractor’s own plant, tools and methods, or through negligent acts of the subcontractor occurring as a detail of the work” (Persichilli v Triborough Bridge & Tunnel Auth., 16 NY2d 136, 145), it followed that an owner or general contractor could not be held responsible for the negligent acts of others over whom he had no direction or control (Curtis v State of New York, 23 NY2d 976). The liability of an owner or general contractor under the 1962 amendment was, therefore, dependent upon a showing that they exercised some degree of control or supervision of the work site (e.g., Kappel v Fisher Bros., 6th Ave. Corp., 39 NY2d 1039, 1041; Tallarico v Long Is. Light. Co., 45 AD2d 845, affd 38 NY2d 733; Scavone v State Univ. Constr. Fund, 46 AD2d 895, 896).

It soon became all too evident that the intent of the Legislature — to give the workman in the hazardous employment of construction, demolition and excavation added protection, other than workmen’s compensation, in the form of nondelegable duties cast upon the owner and general contractor with ensuing liability for breach of those duties — was being easily circumvented under the 1962 version of section 241 by its requirement of control. Owners and contractors were able to insulate themselves from liability for injuries caused by dangerous and unlawful conditions on the job site, and indeed were encouraged to disregard such conditions, lest they be found to be in control. More importantly, the inclination of an owner or contractor to engage a subcontractor predicated on price alone was greatly enhanced, with a concomitant disregard of the safety record and practices of the subcontractor.

Accordingly, in 1969 the Legislature again amended section 241 (L 1969, ch 1108, § 3), so as to once again place "ultimate responsibility for safety practices at building construction jobs where such responsibility actually belongs, on the owner and general contractor” (NY Legis Ann, 1969, p 407). The effect of this amendment was to restore to section 241 the vitality and protections which had previously existed and which had been removed from the statute by virtue of its 1962 amendment. This was accomplished by the re-enactment of the prefatory paragraph as it existed prior to the 1962 amendment, the deletion of subcontractors from the scope of the statute and the restoration of former subdivisions 1 through 5, which the 1962 amendment had excised. Similarly, subdivisions 7 and 8 of the 1969 amendment authorize the Board of Standards and Appeals to promulgate rules and regulations for the protection of workmen, a grant of authority identical to that contained in subdivisions 6 and 7 of the statute as it had existed prior to 1962. And, more importantly for purposes of these appeals, the 1969 amendment imposed on owners and contractors the nondelegable duty to insure that areas in which excavation work is being performed "shall be so constructed, shored * * * and conducted as to provide reasonable and adequate protection and safety to the persons employed therein” (Labor Law, § 241, subd 6).

Thus, the conclusion is inescapable that the change effected by the 1969 legislation was a substantial one, for it fashions absolute liability upon an owner or contractor for a breach of the duties imposed by subdivisions 1 through 6 of section 241 irrespective of their control or supervision of the construction site (cf. Rocha v State of New York, 45 AD2d 633, mot for lv to app den 36 NY2d 642). Doubtless this duty is onerous; yet, it is one the Legislature quite reasonably deemed necessary by reason of the exceptional dangers inherent in connection with "constructing or demolishing buildings or doing any excavating in connection therewith.” In pointing to this underlying policy inherent in the legislative product, we reiterate what we have expressed previously — that we construe the statute in a judicial role and do not function as legislators (see Matter of Rapp v New York City Employees’ Retirement System, 42 NY2d 1, 6).

Moreover, the statute now serves the salutary purpose of inducing owners and contractors to assure that only financially responsible and safety-conscious subcontractors are engaged so that a high standard of care might be maintained throughout the entire construction site. While the duty imposed by section 241 may not be delegated, the burden may be shifted to the party actually responsible for the accident, either by way of a claim for apportionment of damages under the rule of Dole v Dow Chem. Co. (30 NY2d 143) or by contractual language requiring indemnification by the injured worker’s employer (see Kelly v Diesel Constr. Div. of Carl A. Morse, Inc., 35 NY2d 1, 5-7). The hiring of responsible subcontractors will be encouraged, for any solace based upon a right of indemnification or contribution will be short lived if it proves that the subcontractor is financially irresponsible. Further, as liability in normal course will be cast ultimately upon the party actually responsible for the accident, insurance premiums will be adversely affected, thereby furnishing an additional incentive to both insurer and insured to maintain safety standards necessary to avoid increased exposure to liability.

Accordingly, in the Allen action the order of the Appellate Division should be affirmed, with costs, and the question certified answered in the negative; and in the Myers action, the judgments of the Supreme Court should be affirmed, with costs.

Chief Judge Breitel and Judges Jasen, Gabrielli, Jones, Wachtler and Fuchsberg concur.

In Allen v Cloutier Constr. Corp.: Order affirmed, etc.

In Myers v Cornell Univ.: Judgments affirmed.


source: Caselaw Access Project

author: Jones, J.

license: Public Domain

text:
    Health Insurance Association of America et al., Appellants-Respondents, v Thomas A. Harnett, as Superintendent of Insurance of the State of New York, Respondent-Appellant.
    Argued March 21, 1978;
    decided May 2, 1978

      POINTS OF COUNSEL

      Sidney S. Rosdeitcher, Robert S. Smith, John Charles Boger and Roger E. Schechter for appellants-respondents.
    I. The Mandatory Maternity Care Coverage Law violates due process because the burdens it imposes on insurers and policyholders are not justified by any rational relation to a valid public purpose. (Patterson v Carey, 41 NY2d 714; Defiance Milk Prods. Co. v Du Mond, 309 NY 537; Trio Distr. Corp. v City of Albany, 2 NY2d 690; Aerated Prods. Co. of Buffalo v Godfrey, 290 NY 92; Society of Plastics Ind. v City of New York, 68 Misc 2d 366; People v Bunis, 9 NY2d 1; Good Humor Corp. v City of New York, 290 NY 312; Matter of Bon-Air Estates v Building Inspector of Town of Ramapo, 31 AD2d 502; Herrick v Ingraham, 74 Misc 2d 234, 46 AD2d 546; Streb v City of Rochester, 32 Misc 2d 29.) II. The Mandatory Maternity Care Coverage Law violates due process because it compels companies engaged in selling individual health insurance to enter a different and more hazardous business. (California Auto. Assn, v Maloney, 341 US 105; Insurers’ Action Council v Heaton, 423 F Supp 921.)

      Louis J. Lefkowitz, Attorney-General (Arnold D. Fleischer, Samuel A. Hirshowitz and George D. Zuckerman of counsel), for respondent-appellant.
    I. The insurance companies’ claims of deprivation of due process are premature and speculative. (Matter of Old Republic Life Ins. Co. v Wikler, 9 NY2d 524; Matter of Dairylea Coop. v Walkley, 38 NY2d 6; Matter of Fritz v Huntington Hosp., 39 NY2d 339; Craig v Boren, 429 US 190; Prashker v United States Guar. Co., 1 NY2d 584.) II. The challenged statute does not deprive plaintiffs of property in violation of due process. (People v Nebbia, 262 NY 259, 291 US 502; New York State Thruway Auth. v Ashley Motor Ct., 10 NY2d 151; Nettleton Co. v Diamond, 27 NY2d 182, app dsmd sub nom. Reptile Prods. Assn. v Diamond, 401 US 969; Williamson v Lee Opt. Co., 348 US 483; Montgomery v Daniels, 38 NY2d 41; Matter of Taylor v Sise, 33 NY2d 357; Lincoln Bldg. Assoc. v Barr, 1 NY2d 413; Farrington v Pinckney, 1 NY2d 74.) III. Chapter 843 does not unconstitutionally impair plaintiffs’ contract rights. (Moore v Metropolitan Life Ins. Co., 33 NY2d 304; Home Bldg. & Loan Assn. v Blaisdell, 290 US 398; El Paso v Simmons, 379 US 497; Matter of Farrell v Drew, 19 NY2d 486; Matter of Department of Bldgs. of City of N. Y. [Philco Realty Corp.], 14 NY2d 291; Sylvander v Taber, 19 Misc 2d 1005, 9 AD2d 1019, 8 NY2d 835, app dsmd sub nom. Sylvander v Farmers & Traders Life Ins. Co., 364 US 629; East N. Y. Bank v Hahn, 326 US 230; United States Trust Co. v New Jersey, 431 US 1; Country-Wide Ins. Co. v Harnett, 426 F Supp 1030; Patterson v Carey, 41 NY2d 714.) IV. Since no material issues of fact were raised with respect to plaintiffs’ third cause of action, the court below erred in denying defendant’s motion for summary judgment. In any event, this issue is now moot. (Esteve v Abad, 271 App Div 725; Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395; City School Dist. of City of Corning v County of Chemung, 54 AD2d 231; New Orleans v Dukes, 427 US 297; Martin v State Liq. Auth., 43 Misc 2d 682, 15 NY2d 707; Saratoga Harness Racing Assn. v Agriculture & N. Y. State Horse Breeding Dev. Fund, 51 Misc 2d 591, 27 AD2d 631, 22 NY2d 119.)
   OPINION OF THE COURT

Jones, J.

The 1976 legislation mandating the inclusion of maternity care coverage in health and accident insurance policies issued after January 1, 1977 is not unconstitutional as to its substantive provisions; however it may not constitutionally require the addition of such coverage to policies in existence before that date but thereafter renewed, if the renewal is at the option of the insured alone without the consent of the insurer.

As a part of his legislative program, the Governor submitted to the 1976 Legislature what has become known as the Mandatory Maternity Care Coverage Law. When enacted as chapter 843 of the Laws of 1976 on July 27, 1976 it added to the Insurance Law sections 162-a and 164-a and subdivision 1-a of section 253, the effect of which was to require that health insurance policies "written, altered, amended or renewed” after January 1, 1977 include coverage for maternity care to the same extent that hospital service and medical expense indemnity are provided under the policies for illness or disease. Maternity care coverage could be limited to reimbursement of covered expenses for maternity care for a period of four days of hospital confinement and to persons covered under the policy for a period of 10 months, or for a lesser period if the pregnancy commenced while the insured was covered by the policy. The coverage was not required to be included in policies issued to public employers or pursuant to plans sponsored by public employers. In his memorandum in support of the legislation the Governor stated:

"This bill, by providing essential maternity coverage, recognizes that for younger persons the greatest single need for health insurance protection coverage is for maternity care. Rising hospital and medical costs have made payment for maternity care a great financial burden for younger people at a time when many are unable to meet the burden.
"The bill also recognizes the insurance concept of sharing of risk among a broad base of the population, particularly recognizing that the young should have their special areas of health concern adequately covered just as the older population is covered for illnesses or diseases more likely to affect them.”

On January 7, 1977 plaintiffs, the trade association of insurance carriers writing individual and group health insurance policies and 22 of the carriers themselves, commenced the present action for a judgment declaring the 1976 statute unconstitutional and enjoining its enforcement by defendant Superintendent of Insurance. By separate causes of action three attacks were mounted. The first cause of action alleged that the Mandatory Maternity Care Coverage Law deprived plaintiffs of property without due process of law by prohibiting them from selling health insurance policies without the specified maternity care coverage and by requiring plaintiffs to sell a type of coverage they may not want to sell and buyers to buy a type of coverage they may not want to buy, at additional cost, such that plaintiffs will be deprived of substantial revenues as a result of the purchasers’ unwillingness to buy. It was asserted that no need exists to justify such a substantial interference with insurers and insureds. The second cause of action alleged that any application of the statute by defendant to guaranteed renewable and noncancelable policies renewed after January 1, 1977 would work an impairment of contractual obligations in violation of section 10 of article I of the United States Constitution. The third cause of action asserted that, by reason of failing to provide adequate time for compliance, including time to obtain guidelines and approval from defendant Superintendent of Insurance of forms and premium rate changes, the statute deprived plaintiffs of property without due process. After an answer had been filed, cross motions for summary judgment were made by the parties.

Special Term granted defendant’s motion as to the first cause of action and plaintiffs’ motion as to the second cause of action; it declared that chapter 843 of the Laws of 1976 does not violate constitutional due process provisions and is a valid exercise of police power in mandating maternity care coverage, but that the statute may not, consonant with constitutional requirements, be applied to existing health and accident policies as to which plaintiffs have no choice but to renew at the option of the policyholders. With respect to the third cause of action, the court found that material issues of fact were presented as to the adequacy of the time for compliance given by statute and as to claimed delays by defendant making timely implementation impossible; it therefore denied both motions for summary judgment addressed to this cause of action and directed a prompt trial. The injunctive relief sought was also denied. The Appellate Division affirmed the dispositions by the Justice at Special Term. We too affirm as to the first and second causes of action and dismiss the appeal as to the third cause of action.

In support of their claim asserted in the first cause of action that the substantive provisions of the statute violate due process, plaintiffs contend that what are described as the burdens it imposes on insurers (to provide a form of coverage plaintiffs may prefer not to supply) and on policyholders (to purchase a form of coverage some may prefer not to receive) are not justified by any rational relation to a valid public purpose. We disagree.

At the outset we observe that insurance is "a business to which the government has long had a 'special relation’ ” California Auto. Assn. v Maloney, 341 US 105, 109); regulation of the industry, closely related as it is to the public interest (Matter of Massachusetts Mut. Life Ins. Co. v Thacher, 15 AD2d 242, 247), "is surely a proper subject for the state’s exercise of its police power” (Country-Wide Ins. Co. v Harnett, 426 F Supp 1030, 1035, affd 431 US 934). "[I]t is competent for the legislature, in the interest of the people and to promote the general welfare, to regulate insurance companies and the management of their affairs, and to provide by law for that protection to policy holders which they could not secure for themselves” (People v Formosa, 131 NY 478, 483). "[T]he business of writing insurance is not a right; it is a privilege granted by the State subject to the conditions imposed by the State and to its control and supervision” (Matter of People [Int. Workers Order], 199 Misc 941, 967, affd 280 App Div 517, affd 305 NY 258, cert den 346 US 857).

Plaintiffs do not dispute the right of the Legislature to regulate the insurance industry, nor do they deny that the patent objective of the 1976 legislation — to remedy the absence of adequate insurance coverage for rapidly rising maternity care costs falling on young families usually of moderate income — addressed a legitimate public need. Their quarrel is with the means selected to achieve the legislative goal.

We first note that it has long been recognized that what constitutes required due process varies with the status of the party asserting that there has been a denial thereof as well as with the governmental function involved (cf. Goldberg v Kelly, 397 US 254, 263; Dobkin v Chapman, 21 NY2d 490, 502). Though the test for determining whether due process has been accorded may be said to be constant — i.e., whether there has been protection of the individual against arbitrary action (Ohio Bell Tel. Co. v Commission, 301 US 292, 302) — the specifics required to satisfy the standard may differ. Thus, for example, the procedural due process owed to a tenured teacher with a vested right in a position is not the same as that to which a probationary teacher is entitled (Board of Regents v Roth, 408 US 564).

Turning then to plaintiffs’ challenge, we reiterate that a reasonable exercise of the State’s police power is not constitutionally infirm as violative of the due process clause (Nettle- ton Co. v Diamond, 27 NY2d 182, 196). When a statute is challenged on nonprocedural grounds as violative of due process of law the question is whether there is some fair, just and reasonable connection between it and the promotion of the health, comfort, safety and welfare of society (Montgomery v Daniels, 38 NY2d 41, 54; People v Bunis, 9 NY2d 1, 4). Judicial inquiry begins with the recognition that as a matter of substantive law every legislative enactment is deemed to be constitutional until its challengers have satisfied the court to the contrary and that the Legislature is presumed to have investigated and found the existence of a situation indicating the need for and the desirability of the statute (Montgomery v Daniels, 38 NY2d 41, 54, supra). Whether the enactment of chapter 843 of the Laws of 1976 be examined as an exercise of police power, the reasonableness of which must be measured against the foregoing standard (as plaintiffs seem to contend by the authorities they cite), or whether it be examined as an exercise of the Legislature’s regulatory authority over the insurance industry — to which perhaps a less stringent standard of scrutiny is applicable — we find no difficulty in concluding that the substantive provisions of the legislation do not deprive plaintiffs of due process of law.

It is clear, at least at this time and on a record compiled only shortly after the effective date of the statute, that the mandate of the legislation for provision of maternity care coverage in individual and group health insurance policies may be expected to be an effective method of meeting the need for such coverage identified at the time of submission and adoption of the legislation. Whereas, under conditions as they existed prior to January 1, 1977, benefits to compensate for medical expenses incident to childbirth were not widely available and, to the extent available, were not nearly adequate to provide a significant measure of protection against such expenses, after the effective date of chapter 843, coverage would be provided to the broad segment of the population who enjoy coverage against medical expenses occasioned by illness or disease and to the same extent as such latter coverage. That the extension of protection thus accomplished will be substantial is demonstrated by plaintiffs’ own estimate of premiums to be generated by such coverage as running in the millions of dollars annually. Whether plaintiffs’ apprehensive speculation that the inclusion of maternity coverage in health insurance policies with resulting increases in premiums will bring about a consequent loss of business to insurers as insureds terminate or curtail their health insurance coverage will prove to be justified, cannot now be determined. In this respect the present case differs significantly from Defiance Milk Prods. Co. v Du Mond (309 NY 537), relied on by plaintiffs. In Defiance the challenge to the statute was mounted after it had been in effect for more than 30 years and when the court could say, based on practical experience, that the regulation requiring sales of evaporated milk in no less than 10-pound containers accomplished an exclusion of the product from sale within the State because "the minimum quantity so specified is many times larger than could or would be sold and purchased in a retail food shop” (309 NY 537, 540). Whatever may be plaintiffs’ anticipation, in no way may the statute here in question —which in terms prohibits nothing — now be regarded as a prohibition on the sale of a nondeleterious product, as in fact could the statute in the Defiance case.

Plaintiffs’ argument that there is a fatal defect in the legislation because its result will be to impose a part of the cost of maternity care coverage, through increased premiums occasioned by such coverage, on purchasers of health insurance policies who do not want, or do not need, protection against the expenses of childbirth is refuted by the concept— basic to insurance — of risk sharing, a factor consciously taken into account when the legislation was fashioned. Additionally, the extent to which the cost of maternity care coverage falls on a particular group — as, for instance, the elderly — is determined by the manner in which the cost of the benefits is allocated among the insureds, a subject as to which no provision was included in the legislation and which was therefore left for initial address by the insurers in preparing and seeking approval of premium rate schedules.

Totally without merit as a basis for invalidating chapter 843 is plaintiffs’ argument that "The effect of the new law is to require the entire burden to be borne by the existing health insurance system; persons who do not happen to have health insurance are wholly exempt from bearing the burden of maternity coverage”. The principle incorporated in this self-evident statement is equally applicable to any type of insurance — thus, the entire burden of automobile liability coverage is borne by the existing automobile liability system; persons who do not happen to have such insurance are exempt from bearing the burden of liability coverage. That fact, however, does not present any basis for invalidating the mandated coverage.

Nor is there merit to plaintiffs’ contention that they are being compelled to enter a different and more hazardous business than that in which they choose to be engaged. The determination by Special Term that the statute does not require insurers to enter into a new business but merely to include a health care expense not previously covered is sound and provides a valid basis for distinguishing Hartford Acc. & Ind. Co. v Ingram (290 NC 457), so strongly relied on by plaintiffs. The statute there under attack did in fact require general liability insurance carriers to add a new coverage (malpractice insurance) to their offerings. While the question might be regarded as one of degree, we perceive the extension from general liability to malpractice insurance to be both substantially greater in degree and different in kind from the inclusion of maternity care coverage within that of hospital and medical expenses for illness and disease; the comparison here is closer to the home health care provisions required to be included in accident and sickness policies by subdivisions 7-f to 7-j of section 164 of the Insurance Law.

Finally, concluding that plaintiffs have failed to establish that section 843 of the Laws of 1976 is unfair, unjust or arbitrary and thus a deprivation of due process, we note, in response to plaintiffs’ assertion that other — and in their view, better — means could have been found to meet the objective of making maternity care coverage widely available, that the choice of means was within the legislative prerogative; its wisdom in exercising its discriminating authority, absent an unconstitutional selection, is beyond the scope of judicial review (Montgomery v Daniels, 38 NY2d 41, 56, supra).

Turning to plaintiffs’ second cause of action on which judgment has been granted in their favor declaring that chapter 843 may not, consonant with constitutional restrictions on impairment of obligations of contract, modify policies issued by plaintiffs as guaranteed renewable policies (those issued before the effective date of the statute which, though the premiums might be increased, plaintiffs have no choice but to renew at the option of the other party to the insurance contract), we agree with the determination by the courts below (Moore v Metropolitan Life Ins. Co., 33 NY2d 304). The holding in Moore (p 312) that "Where * * * the insurer does not have the right to terminate the policy or change the premium rate without consent of the [insured], renewal, by the payment of premiums merely continues in force the preexisting policy, and statutes enacted subsequent to its original enactment cannot be applied” is dispositive of this cause of action (cf. Char-Mo Investors v Market Ins. Co., 44 NY2d 793). Defendant’s reliance on the existence of a right in the insurers to increase premiums on provision of maternity care coverage as sufficient to satisfy the requirements set forth in Moore as prerequisite to the validity of statutory modification of insurance contracts is misplaced. What is required is a choice open to the insurer to increase premiums or in the alternative, if it so elects, to terminate — thus, fail to renew— the policy and escape the added risk imposed by the statutory modification; the right to increase premiums alone is not sufficient (Mulligan v Travelers Ins. Co., 280 App Div 764, affd 306 NY 805).

Defendant’s attempt to justify and to uphold the impairment of contract rights and obligations, which would be impermissible under Moore if chapter 843 were given effect with respect to guaranteed renewable policies, is not persuasive. Cases such as Home Bldg. & Loan Assn. v Blaisdell (290 US 398), cited by defendant, in which a compelling public interest, in face of what amounts to an economic emergency of broad scope and ramification, takes precedence over individual contract rights occur but infrequently. Only on rare occasions and in extreme circumstances do rights fixed by the terms of a contract willingly entered into give way to a greater public need (cf. Matter of Subway-Surface Supervisors Assn. v New York City Tr. Auth., 44 NY2d 101; United States Trust Co. v New Jersey, 431 US 1). In the present case, while there was a genuine, identifiable public purpose to be served by the enactment of chapter 843, the predicament which spawned the legislation had not risen to the magnitude of a crisis which warranted overriding the terms of the agreements entered into by the parties to the guaranteed renewable health and accident policies.

For the reasons stated, the order of the Appellate Division should be affirmed, without costs, except that on defendant’s appeal the third cause of action should be deemed severed and his appeal with respect thereto dismissed for nonfinality.

Chief Judge Breitel and Judges Jasen, Gabrielli, Wachtler, Fuchsberg and Cooke concur.

On plaintiffs’ appeal: Order, insofar as appealed from, affirmed, without costs.

On defendant’s cross appeal: Cross appeal, from so much of the Appellate Division order as affirmed the denial of defendant’s motion for summary judgment with respect to plaintiffs’ third cause of action, dismissed upon the ground that such portion of the order appealed from does not finally determine the action within the meaning of the Constitution; order otherwise affirmed, without costs.

      . The new section 162-a, applicable to group or blanket accident and health policies, provided: "Every policy subject to the provisions of section one hundred sixty-two which provides hospital, surgical or medical coverage shall provide coverage for maternity care, including hospital, surgical or medical care to the same extent that hospital, surgical or medical coverage is provided for illness or disease under the policy, provided, however, that such maternity care coverage, other than coverage for complications of pregnancy, may be limited to reimbursement of covered expenses for maternity care for a period of four days of hospital confinement. Maternity care coverage may also be limited to those persons covered under the policy for a period of ten months, or for a lesser period if the pregnancy commenced while the insured was covered by the policy. The requirements of this section shall not be applicable, however, to any policies which have been or shall be issued to any 'government’ or 'public employer’, as those terms are defined in paragraph a of subdivision six of section two hundred one of the civil service law.”
      Similar provision was made in section 164-a with respect to individual accident and sickness policies and in subdivision 1-a of section 253 with respect to contracts issued by hospital service and other nonprofit corporations.

        . The reality of the need is documented by statistics included in the record disclosing increases of 50% in some hospital maternity room rates in the four years immediately preceding enactment of the statute, such that medical expenses incident to the birth of a child were reaching and exceeding a figure of $2,000; availability of maternity care insurance, on the other hand, was quite limited and, when available, benefits usually amounted to only a small part of the costs customarily incurred. A report issued in 1974 by the Senate Task Force on Critical Problems stated that the average family was not able to accumulate by savings in the months preceding delivery the funds necessary to meet the expenses of childbirth.

      . In People v Formosa (131 NY 478, supra) in reviewing an attack on a statute regulating the conduct of the life insurance industry, after discussing the authority of the Legislature under the police power, the court stated at pages 483 and 484: "We have no occasion now to specify to what extent [the police power] might reach, or in any way to place upon it its proper limitations, because, in order to justify the act in question, it is not necessary to resort to that power. * * * The power exercised over these insurance companies and their agents is similar to that exercised by the legislature over banks and railway corporations; and it has never been doubted that such power exists, and the legislative power to regulate them and their agents in the minutest particular in the interest of the public, has never been questioned.” (See, also, Merchants Liab. Co. v Smart, 267 US 126, 129.)


author:
      Per Curiam.
     Fuchsberg, J.

text:
    The People of the State of New York, Respondent, v Anthony Leone, Jr., Appellant.
    Argued February 10, 1978;
    decided May 2, 1978

      POINTS OF COUNSEL

      Harvey L. Greenberg for appellant.
    I. Appellant, in fact and in law, by complying with the order of the Honorable John R. Starkey dated August 21, 1974, did purge himself of the contempt set forth in the within indictment. (Matter of Amado, 204 Misc 454; Typothetae of City of N. Y. v Typographical Union No. 6, 138 App Div 293; Colombo v New York, 405 US 9; People v Colombo, 31 NY2d 947.) II. The trial court erred in refusing to allow appellant to assert as a defense: (1) that there was a valid court order allowing appellant to purge himself of the contempt; (2) to show that the prosecution was guilty of laches in failing to comply with said order; (3) that appellant in fact did appear before the Grand Jury and testified fully. (Matter of Storm, 28 AD2d 290; Baker v Eisenstadt, 456 F2d 382; People v Colgan, 50 AD2d 932; Matter of Rodriguez v Feinberg, 40 NY2d 994.)

      Eugene Gold, District Attorney (Michael Gore of counsel), for respondent.
    I. Did appellant’s belated Grand Jury appearance purge the contempt herein? (People v Colombo, 29 NY2d 1, vacated and remanded on other grounds sub nom. Colombo v New York, 405 US 9; Bessette v Conkey Co., 194 US 324; Typothetae of City of N. Y. v Typographical Union No. 6, 138 App Div 293; Matter of Alphonse C., 38 NY2d 923.) II. The trial court committed no error in its evidentiary rulings. (United States v Yates, 355 US 66.)
   OPINION OF THE COURT

Per Curiam.

Defendant appeals from an affirmance of his conviction, after indictment and jury trial, of criminal contempt in the first degree (Penal Law, § 215.51). The contempt arose out of his refusal, in violation of a court order, to answer questions before a Grand Jury. Defendant contends that his contempt has been purged and the indictment should be dismissed. He relies on an order made by a Supreme Court Justice, more than a year after defendant’s indictment and nearly two years after the contempt, allowing defendant to purge the contempt by testifying before the Grand Jury. At trial no reference to the purge order or defendant’s subsequent testimony was permitted.

At issue is the power of a Judge to allow a defendant who has been indicted for criminal contempt under the Penal Law to purge himself of the indictment by complying, belatedly, with a court order earlier disobeyed. Since it is concluded that the purge order could have no effect on the indictment for the crime of contempt, there should be an affirmance. The problem and its resolution are simple and elaboration would be superfluous. Not to be confused with the crime of contempt, as defined in the Penal Law, is summary contempt, either civil or criminal. When the crime of contempt, prosecuted by indictment, is involved, a court may not permit the contempt to be purged.

Indictment for the crime of contempt, as defined in the Penal Law, like any other crime entitles defendant to a plenary trial. The crime is not intended solely to vindicate the authority of the court, but to further the ends of public justice as well. Thus, the crime of contempt must be distinguished from a summary criminal contempt adjudication, or a civil contempt which may undoubtedly be purged (Judiciary Law, §§ 750, 753). As had been said, nearly a century ago: "The two proceedings are wholly independent of each other. One who disobeys the lawful order of a court not only offends against the dignity of the particular tribunal, but also against the public law. The particular court may pass over the contempt and suffer its order to be spurned, but the offense against the people remains. Their authority has been contemned, the administration of public justice assailed, and its power despised” (People ex rel. Sherwin v Mead, 92 NY 415, 420 [Finch, J.]; see, also, People v Colombo, 29 NY2d 1, 4, vacated and remanded on other grounds sub nom. Colombo v New York, 405 US 9). Thus, once a contempt goes to indictment and prosecution, forgiveness by an individual Judge or court may not be permitted to frustrate the power to punish for the affront to public justice. Purging of the contempt, therefore, is not permissible, at least in the absence of statutory authority.

Unnecessary to reach, and probably incorrect, is the conclusion that under no circumstances may a "criminal” summary contempt be purged. In fact, this court has concluded, in some circumstances at least, that one summarily adjudged in criminal contempt pursuant to section 750 of the Judiciary Law " 'holds the key to his freedom’ ” (Colombo v New York, 29 NY2d 1, 4, supra; People ex rel. Valenti v McCloskey, 6 NY2d 390, 399, app dsmd 361 US 534; see, also, Typothetae of City of N. Y. v Typographical Union No. 6, 138 App Div 293). Arguably, implicit in such a conclusion is the ability to purge some criminal contempts as distinguished from crimes of contempt. As noted already, however, that issue need not be reached.

This is how the law of New York has developed. It should not be confused with a somewhat different categorization of summary criminal contempts in cases before the Supreme Court of the United States involving the application of principles of double jeopardy or jury trial (e.g., Colombo v New York, 405 US 9, 10-11, supra; Shillitani v United States, 384 US 364, 368-372; Cheff v Schnackenberg, 384 US 373, 377-380).

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

Fuchsberg, J.

(concurring). This case presents claims (1) that the District Attorney, in bringing appellant before the Grand Jury, acquiesced in the acceptance of a judicial offer of redemption and thus waived any objection to its enforcement and (2) that the unappealed decision of the Judge who granted the defendant’s motion to purge himself became the "law of the case” binding on District Attorney and trial court alike. Beyond that, the analytical divergence of the opinions below points up the recurrent confusion in the law of contempt. I therefore believe more extensive discussion is merited.

Though the power to punish for criminal contempt in New York is now to be found entirely in our statutes, its roots are ancient. In Anglo-Saxon tradition alone this power is traceable at least as far back as the twelfth century (Fox, History of Contempt of Court [1927], p 1). Blackstone later described it as "an inseparable attendant upon every superior tribunal” and "as ancient as the laws themselves” (4 Blackstone, Commentaries, p 282). And American courts, following those leads, have consistently regarded it as inherent and indispensable to their judicial functions (see, e.g., United States v Hudson, 7 Cranch, [11 US] 32, 34; Thomas, Problems of Contempt of Court, pp 49-53).

Appellant, by his refusal to answer questions posed by the Grand Jury, flouted this power. The dignity of our courts having thus been affronted, its vindication could follow one of two statutory avenues, either that prescribed by sections 750 and 751 of the Judiciary Law or the one to be found in sections 215.50 and 215.51 of the Penal Law.

Under the Judiciary Law sections, a court has the power summarily to punish for specified acts, among which is "contumacious and unlawful refusal to be sworn as a witness; or, after being sworn, to answer any legal and proper interrogatory.” While the sanctions which may be imposed under these sections may be expeditious, they are comparatively light, being limited to a $250 fine and 30 days in jail. (This relative leniency has not been without criticism; see the comments of Professor Siegel in McKinney’s Cons Laws of NY, Book 7B, Practice Commentary to CPLR 2308, subd [a].)

In this case, as no summary action was instituted against appellant under the Judiciary Law, the concomitant discretion that a court acting summarily retains to allow a contemnor to purge himself did not come into play (cf. People ex rel. Valenti v McCloskey, 6 NY2d 390, 399, app dsmd 361 US 534).

Under the Penal Law sections, while the State may attempt to exact a more severe penalty, it may not proceed summarily. Thus, having chosen to indict the appellant here for criminal contempt in the first degree under section 215.51 of the Penal Law, a class E felony, the People were required to accord him all the safeguards of a plenary trial. Another result of the pursuit of proceedings under the Penal Law rather than the Judiciary Law was that the appellant could not absolve himself of his contemptuous conduct by his subsequent compliance with the commands of the court.

For section 215.51 of the Penal Law made appellant’s crime complete when, "after having been sworn * * * before a grand jury, [he] refuse[d] to answer”. His belated change of heart could no more excuse him from responsibility for his crime than would an indicted embezzler’s disgorgement of the avails of his larceny (cf. People v Colombo, 29 NY2d 1, 3, vacated and remanded on other grounds 405 US 9). Nor could Leone’s subsequent testimony before the Grand Jury eradicate the intent with which he defiantly undertook to obstruct justice two and a'half years earlier.

That his ameliorative conduct might be appropriately considered by the sentencing Judge on the limited issue of punishment is besides the point. For that purpose, eventual compliance very well could be a mitigating factor. But it was not a defense. (Yates v United States, 355 US 66, 72.) Consequently, on the issue of guilt or innocence, proof of the fact that he eventually did testify and of the issuance of the order which preceded that event were properly excluded at trial.

True it is that the outstanding "purge” order may have led Leone to believe that retroactive immunity could be his. But, in testifying, he did no more than what he was obligated to do. The prosecutor’s right to recall him was not dependent on the order. Had the appellant then continued in his refusal to answer questions — even if conviction and punishment for the earlier offense had already been a thing of the past — the State would have had the right to persist in its efforts to obtain his testimony and, if necessary, to have prosecuted him anew for a later and therefore separate contempt (Matter of Ushkowitz v Helfand, 15 NY2d 713; Matter of Second Grand Jury v Cirillo, 12 NY2d 206 [Desmond, Ch. J.]; People v Matra, 42 AD2d 865, 866; Matter of Vario v County Ct., 32 AD2d 1038, 1039, mot for lv to app den 25 NY2d 741; United States ex rel. Ushkowitz v McCloskey, 359 F2d 788).

The appellant also cannot take refuge behind a "law of the case” contention that the Trial Judge and the prosecutor were bound by the terms of the "purge” order. The law of the case doctrine is not an inflexible rule (Dictograph Prods. Co. v Sonotone Corp., 230 F2d 131, 134-135 [Learned Hand, J.], reh den 231 F2d 867, cert dsmd 352 US 883; cf. Martin v City of Cohoes, 37 NY2d 162, 165). Absent a claim of double jeopardy, of which there is none here, a criminal defendant has no vested right in an error of law (United States v Wilson, 420 US 332, 345).

Nor was the earlier Judge’s postindictment grant of leave for defendant to purge himself a bar to the prosecution. In criminal no less than in civil cases, where circumstances require it, one Judge has the power to deviate from a decision made by another (State v Richards, 229 NW2d 229, 232-233 [Iowa]; People v Milo, 35 AD2d 848 [semble]; but see People v Lenti, 46 Misc 2d 682, 685). All the more was this so here, where the People could not appeal unless and until the indictment was dismissed (see CPL 450.20; cf. Matter of Alphonso C., 38 NY2d 923, 925). It was most doubtful too that prohibition would have been a viable remedy (Matter of State of New York v King, 36 NY2d 59).

In short, affirmance in this case is dictated not only by the resolution of the stellar issue but of its satellites as well.

Chief Judge Breitel and Judges Jasen, Gabrielli, Jones and Cooke concur in Per Curiam opinion: Judge Fuchsberg concurs in result in a separate opinion in which Judge Wachtler concurs.

Order affirmed.

      . (See Moskowitz, Contempt of Injunctions, Civil and Criminal, 43 Col L Rev 780; Civil and Criminal Contempt in Federal Courts, 17 FRD 167.)

      . The double jeopardy clause precludes resort to both statutory schemes for prosecution of the same offense (see People v Colombo, 31 NY2d 947).

      . I am aware of the fact that the American Bar' Association has recently expressed a contrary view (American Bar Association, Policy on the Grand Jury [1977], comment 24, p 16). But I see no reason to depart from Chief Judge Desmond’s analysis in Cirillo. As he put it, "Every citizen is subject to be recalled as a witness before the same Grand Jury or investigating body. There is no reason why one should get immunity as to subsequent contempts by serving a term of imprisonment and paying a fine. The State has a right to his truthful testimony and has a right to try again to get it after he has once been found guilty of contempt and punished” (p 210).


author: Jasen, J. Jones, J.

text:
    In the Matter of the Claim of Sue Greene, Appellant, v City of New York Department of Social Services, Respondent. Workmen’s Compensation Board, Respondent.
    Submitted March 28, 1978;
    decided May 4, 1978

      POINTS OF COUNSEL

      Robert M. Ziskin and Stephen F. Gordon for appellant.
    I. The board’s conclusion that claimant’s accident did not arise out of and in the course of her employment is erroneous as a matter of fact and law. (Matter of Devito v Imbriano, 39 AD2d 796, 33 NY2d 757.) II. Liberal construction must be given to the Workmen’s Compensation Law. (Matter of Redfield v Boulevard Gardens Housing Corp., 4 AD2d 906, 3 NY2d 710; Boyle v Cheney Piano Action Co., 193 App Div 408.)

      W. Bernard Richland, Corporation Counsel (L. Kevin Sheridan of counsel), for City of New York Department of Social Services, respondent.
    The Workmen’s Compensation Board correctly held that appellant’s accident did not arise out of her employment. (Matter of Fronce v Prosperity Co., 255 NY 613; Matter of Chetney v Manning Co., 273 NY 82; Matter of Bennett v Marine Works, 273 NY 429; Erdberg v United Textile Print Works, 216 App Div 574; Didier v McFadden Pub., 299 NY 49; Matter of Bodensky v Royaltone, Inc., 5 AD2d 733.)
   OPINION OF THE COURT

Jasen, J.

The claimant, Sue Greene, was employed by the respondent, City of New York Department of Social Services, in the capacity of a homemaker. As such, she was required to travel each working day to the homes of several designated clients to provide domestic services for them. Homemakers were not authorized to use their private automobiles in carrying out their assigned tasks, unless permission was obtained. Although claimant never sought authorization to use her private automobile, she elected, nevertheless, on occasion, without informing her supervisor, to drive to her work assignments to avoid the inconvenience of public transportation. December 10, 1974 was one of those occasions when she used a private car for work purposes. At about 2:00 p.m., while en route to her second assignment of the day, she collided with a truck, and sustained hip injuries which prevented her from working for several months.

Claimant sought workmen’s compensation benefits for the injuries she sustained. After a hearing, the referee disallowed the claim and the Workmen’s Compensation Board affirmed on the ground that "claimant used her car for personal reasons without the consent or knowledge of her employer and therefore her accident did not arise out of and in the course of her employment.” A closely divided Appellate Division affirmed, noting that "Under these circumstances, the increase in the risks to the employer resulting from claimant’s conduct are obvious, and the record plainly indicates a violation by claimant of an 'implied prohibition’ at minimum [citation omitted].”

The issue presented in its most simple terms is whether, for purposes of the Workmen’s Compensation Law, claimant was within the course of her employment, as a matter of law, when the accident occurred. Respondents contend that appellant, in using her vehicle without obtaining or even seeking authorization, engaged in an activity impliedly prohibited by her employer, and that she was, therefore, not within the course of her employment at the time of the accident. Although it may be true that appellant did violate an implied prohibition, we cannot agree on the record before us that this violation removed her from the course of her employment, thereby rendering her ineligible for workmen’s compensation benefits.

As a general rule, employees are not deemed to be within the scope of their employment while traveling to and from work. (Van Gee v Korts, 252 NY 241; 65 NY Jur, Workmen’s Compensation, § 360.) This rule recognizes that the risks inherent in traveling to and from work relate to the employment only in the most marginal sense. Usually, injuries arising while traveling to and from the place of work are neither directly nor incidentally related to employment, and are, therefore, not compensable. An exception to this general rule, however, allows for compensation where an "outside worker” is injured while engaged in work-related travel. (Matter of Bennett v Marine Works, 273 NY 429.) Such employees, who do not work at one fixed location, are required in conjunction with their employment to travel from one location of work to another. Under such circumstances, the risks of travel do arise in the course of employment.

There can be little doubt that the claimant in this case was an "outside worker”. As a homemaker, she did not perform her duties at a particular location, but, instead, she was required to travel, in accordance with the assignments given by her supervisor, to several locations during the course of the working day.

It is argued, however, that claimant, in violating the implied prohibition that she not use her car for work-related transportation, was not in the course of her employment when the accident occurred. The question, therefore, remains whether the unauthorized use of a private automobile, under the circumstances present here, constituted such a deviation and departure of the employer’s rules of employment as to fall outside the course of claimant’s employment. We think not. As an "outside worker”, it was necessary for claimant, as part of her job, not only to provide domestic services to her clients, but also to travel between her clients’ homes to carry out her work responsibilities. The travel between her clients’ homes was an integral part of her duties. At the time of the accident, claimant, in traveling to an assigned client during regular working hours, was doing exactly what she had been employed to do. While she disobeyed her employer’s implied prohibition against using her own automobile in traveling to her assignments, she was in all other respects performing her assigned work. Under such circumstances, we believe her disobedience related solely to the manner of doing the work specifically assigned to her. As such, violation of a prohibition, related to the manner of travel, whether express or implied, should not place the claimant outside the course of her employment for the purposes of the Workmen’s Compensation Law. (Erdberg v United Textile Print Works, 216 App Div 574.) This conclusion is not only supported by logic, but also promotes "the fundamental concept that the Workmen’s Compensation Law, being remedial in character, is to be construed liberally to accomplish the economic and humanitarian objects of the act”. (Husted v Seneca Steel Serv., 41 NY2d 140, 145.) Thus, we hold, as a matter of law, that the Workmen’s Compensation Board was not justified in ruling that the accident which occurred while claimant was traveling between clients’ homes in her automobile was not compensable. The substantial evidence test, usually appropriate in reviewing a board’s determination, is, therefore, not applicable under these circumstances.

Accordingly, the order of the Appellate Division should be reversed, with costs, and the case remitted to the Appellate Division, Third Department, with directions to remand to the Workers’ Compensation Board for a determination of the amount to be awarded to claimant.

Jones, J.

(dissenting). I cannot accept the view expressed by the majority that claimant is entitled to workmen’s compensation benefits as a matter of law.

Sue Greene was employed as a homemaker in the Department of Social Services of the City of New York. In the performance of her duties she was required to travel to the homes of her several clients. On September 10, 1974, about 2:00 p.m., while driving her own car from one work assignment to another she was injured in a traffic accident.

After a hearing the referee denied her claim on a finding that her injuries did not arise out of and in the course of her employment. The Workmen’s Compensation Board affirmed this initial determination, and the board’s decision was affirmed at the Appellate Division. The familiar issue on the appeal before us is whether there was substantial evidence to sustain the determination of the board.

Although I recognize that contrary inferences might have been drawn from the uncontroverted testimony in this record and concede that I would likewise have upheld the board had it determined to grant benefits, I agree with the majority at the Appellate Division that there was substantial evidence to support the board’s denial of benefits. Both Mrs. Duncan, claimant’s case supervisor, and Barbara Patrick, a supervising field worker, testified that homemakers were not authorized to use their private cars unless permission was obtained. Neither knew of claimant’s having sought such permission; indeed claimant testified that she had never asked for authorization to use her car. Claimant also testified that neither her supervisor nor any other superior knew that she was using her car, and further that she had used it for her own convenience — it had been a cold morning and she would otherwise have had to take two buses for an early appointment.

Based on consideration of the entire record, including the testimony taken before him, the referee found "that this claimant used her personal automobile for her own convenience and her personal use, without the consent, knowledge, and or authority of her employer, the City of NY”. The denial of compensation benefits was predicated on this finding.

Whether, in the circumstances disclosed in this record, the unauthorized use of a private automobile constituted such a deviation and departure as to fall outside the course of employment involves exactly the sort of factual evaluation and appraisal which the Workmen’s Compensation Board is appointed to make. Manifestly some variances from normal practice in the performance of assigned duties will be within "the course of employment”, others will fall outside that scope. Cases at either extreme will be readily decided. It is precisely the function and responsibility of the Workmen’s Compensation Board, with its daily experience and intimate consciousness of the purpose and objectives of the Workmen’s Compensation Law, to resolve those cases which approach the demarcation line. Determinations of the board in such cases are beyond the reach of judicial intervention; it is only when it may be concluded that a contrary finding was dictated as a matter of law that the courts may set aside the action of the board. There is no such mandate in this instance.

Judges Gabrielli, Wachtler, Fuchsberg and Cooke concur with Judge Jasen; Judge Jones dissents and votes to affirm in a separate opinion in which Chief Judge Breitel concurs.

Order reversed, with costs, and the matter remitted to the Appellate Division, Third Department, with directions to remand to the Workers’ Compensation Board for further proceedings in accordance with the opinion herein.

       By amendment the Workmen’s Compensation Board is now known as the Workers’ Compensation Board. (L 1978, ch 79, eff April 18, 1978.)

       I find no support in the record, by way of express testimony or by implication which might be drawn from the context in which the testimony appears, for the assumption made by the dissenters in the Appellate Division that the "authorization” referred to was related only to entitlement to reimbursement for travel expenses. Indeed claimant makes no such contention in our court.


author: Jasen, J.

text:
    In the Matter of Charles J. Hynes, as Deputy Attorney-General for Health, Social Services and Nursing Homes, Respondent, v Roland Lerner, Appellant.
    Argued March 29, 1978;
    decided May 4, 1978

      POINTS OF COUNSEL

      Marc Freedman and George S. Meissner for appellant.
    I. The court below erred when it based its findings as to the dominant purpose behind the Grand Jury’s postindictment investigation solely upon verbal representations made by the prosecutor. (People v Einhorn, 35 NY2d 948; United States v Fisher, 455 F2d 1101; United States v Lipshitz, 148 F Supp 774; United States v Doss, 545 F2d 548; United States v Sellaro, 514 F2d 114; United States v Doe, 455 F2d 1270; United States v Dardi, 330 F2d 316; United States v Kovaleski, 406 F Supp 267.) II. The court below erred when it failed to make findings concerning the prosecutor’s need for the subpoenaed materials in light of the information available to the Grand Jury through other sources. III. The subpoena duCes tecum is overly broad and offensive to the Fourth and Fourteenth Amendments of the United States Constitution. (Hale v Henkel, 201 US 43; Matter of Moore v Delaney, 180 Misc 844; Federal Trade Comm. v American Tobacco Co., 264 US 298; Matter of Grand Jury Subpoena Duces Tecum, 342 F Supp 709; Matter of Grand Jury Investigation [General Motors Corp.], 174 F Supp 393; Matter of Kent Nursing Homes v Office of Special State Prosecutor for Health & Social Servs., 38 NY2d 260.) IV. Defendant is not required to "leave” subpoenaed materials with the Grand Jury by virtue of recent Court of Appeals decisions. (Matter of Heisler v Hynes, 42 NY2d 250.)

      Charles J. Hynes, Deputy Attorney-General (T. James Bryan and Richard D. Carruthers of counsel), for respondent.
    I. The court based its determination as to the dominant purpose of the subpoena upon an adequate factual basis and properly denied appellant’s motion in all respects. (United States v Sellaro, 514 F2d 114; United States v George, 444 F2d 310; People v Donaudy, 87 Misc 2d 787; People v Johnson, 40 NY2d 882; United States v Doss, 545 F2d 548; United States v Doe, 455 F2d 1270; Matter of Grand Jury Proceeding, 507 F2d 963; Matter of Pilliteri, 420 F Supp 913; United States v Weiner, 418 F Supp 941, 546 F2d 421.) II. The requirement that appellant leave his books and records with the Grand Jury is authorized by statute. (Matter of Horowitz, 482 F2d 72; Schwimmer v United States, 232 F2d 855; Robert Hawthorne, Inc. v Director of Internal Revenue, 406 F Supp 1098; United States v Kleen Laundry & Cleaners, 381 F Supp 519; United States v Culver, 224 F Supp 419; United States v United States Dist. Ct. of Southern Dist. of W. Va., 238 F2d 713, cert den sub nom. Valley Bell Dairy Co. v United States, 352 US 981; Matter of Grand Jury Proceedings, 486 F2d 85; Essgee Co. v United States, 262 US 151; Wilson v United States, 221 US 361.) III. Appellant’s request that this court modify the subpoena duces tecum is not properly before this court.
   OPINION OF THE COURT

Jasen, J.

On October 28, 1976, appellant Roland Lerner, a partner in Park View Nursing Home, was served with a Bronx County Grand Jury subpoena duces tecum requiring him to produce essentially all the home’s business records for 1970 "to the present”.

In a motion to quash the subpoena, made on November 2, 1976, appellant alleged that the subpoena was unduly broad, and that since appellant was the target of a Grand Jury investigation, the subpoena violated his constitutional privilege against self incrimination. The motion was orally denied at Supreme Court, Bronx County, on November 5, 1976, and a formal order of denial was entered on December 10, 1976.

In the meantime, on November 8, 1976, a 25-count indictment against appellant was returned by the Bronx County Grand Jury, charging him with willful violation of the Public Health Laws and conspiracy in the fourth degree. All these charges arose out of a kickback scheme in which appellant had allegedly engaged.

For the second time appellant moved to quash the subpoena on December 21, 1976, now alleging that the dominant purpose of the subpoena was to acquire evidence in preparation for trial of the pending charges. Appellant also argued that the subpoena should be quashed because the materials which it sought would provide information to which the Special Prosecutor already had access. Opposing the motion to quash, and cross-moving to have appellant held in contempt, the Special Prosecutor submitted a sworn affirmation advising the court that the subpoena sought information relating to an investigation of criminal activities other than those contained in the indictment.

On January 20, 1977, Supreme Court, Bronx County, heard oral argument on these motions. To preserve the confidentiality of the Grand Jury proceedings, the court heard an in camera oral statement of the Special Prosecutor out of the presence of opposing counsel. Based on the affirmation and oral statement, the court found that the dominant purpose of the subpoena was to investigate criminal activities other than those alleged in the indictment. The motion to quash was, therefore, denied and appellant was ordered to "produce and leave” all the subpoenaed records with the Grand Jury. The Appellate Division unanimously affirmed.

On this appeal, appellant’s principal contention is that "the court below erred when it based its findings as to the dominant purpose behind the Grand Jury’s post-indictment investigation solely upon verbal representations made by the prosecutor” without requiring production of the Grand Jury minutes.

Preliminarily, it should be stated that once an indictment is issued, a Grand Jury subpoena duces tecum may not be used for the sole or dominant purpose of preparing the pending indictment for trial. Such abuse was specifically disapproved in United States v Dardi (330 F2d 316, 336, cert den 379 US 845) and constitutes a misuse of the Grand Jury process. However, where the purpose of the Grand Jury investigation is directed to other offenses, its scope should not be circumscribed and any collateral or incidental evidence from bona fide inquiries may be used by the prosecutor against the defendant at the trial of the pending indictment.

Appellant, not disputing that the "dominant purpose” rule should be applied in this case to test the validity of the Grand Jury subpoena duces tecum, argues that the evidence offered by the Special Prosecutor at Supreme Court was insufficient as a matter of law to support a finding that the dominant purpose of the subpoena was to obtain information relevant to offenses not contained in the indictment. We cannot agree.

The record adequately supports the finding of the court below. At the hearing on the motion to quash the subpoena, the Special Prosecutor submitted a sworn affirmation in which he asserted that "[t]he Grand Jury * * * is continuing its investigation into whether or not additional crimes have been committed. These additional crimes include, but are not necessarily limited to, Grand Larceny, Offering a False Instrument for Filing, and Falsifying Business Records. Thus, the records sought are required to obtain evidence for different crimes than contained in the said indictment.” In addition, the Special Prosecutor was examined by the court in camera. This examination confirms the affirmation submitted and reveals in greater detail that a legitimate Grand Jury investigation was being conducted in connection with offenses not contained in the indictment. Therefore, we agree that the dominant purpose of the challenged subpoena duces tecum was directed to other offenses than those contained in the indictment.

Contrary to appellant’s contention, the court below was not required to inspect the Grand Jury minutes before rendering its decision, but was justified in relying on the written and oral representations made by the Special Prosecutor. (Matter of Grand Jury Proceedings, 507 F2d 963, 966.) His statements were not limited to vague generalities, but detailed specific allegations of wrongdoing and reasons why the records sought would be relevant to a legitimate Grand Jury investigation. Although the court, in its discretion, might have required the Special Prosecutor to produce the Grand Jury minutes, it was not error, as a matter of law, to rely upon the affirmation and in camera oral statement. Moreover, it was not improper for the court to conduct the hearing in camera. Since Grand Jury proceedings are secret (CPL 190.25, subd 4), the in camera hearing was an acceptable means for the court to become apprised of the purposes of the subpoena, while preserving the secrecy of the Grand Jury proceedings.'

Appellant also argues that the subpoena seeks documents containing information available to the Grand Jury, and that the subpoena is overbroad. The factual showing made by the Special Prosecutor belies both these contentions. At the in camera hearing, the Special Prosecutor explained in detail the need for the subpoenaed materials in connection with investigating uncharged criminal offenses. Having established the relevancy of these documents to a legitimate Grand Jury investigation, the Special Prosecutor has the right to retain and inspect them for a reasonable period of time. (CPL 610.25; Matter of Hynes v Moskowitz, 44 NY2d 383.)

Finally, appellant seeks modification of the order of Supreme Court, Bronx County, which required that he "leave” the subpoenaed records with the Grand Jury. Appellant argues that prior to the enactment of CPL 610.25, effective July 19, 1977, retention of materials obtained by a Grand Jury subpoena duces tecum was forbidden. (Matter of Heisler v Hynes, 42 NY2d 250; cf. Matter of Windsor Park Nursing Home v Hynes, 42 NY2d 243.) Since the challenged subpoena was issued prior to July 19, 1977, appellant contends that CPL 610.25 may not be applied to permit retention of the subpoenaed materials.

In raising this argument, appellant does not challenge the power of the Grand Jury to issue subpoenas, for long before the enactment of CPL 610.25 the Grand Jury had such power. (CPL 190.50, subd 3.) This power was extended by CPL 610.25 only insofar as retention of the subpoenaed material is concerned. Thus, the issue concerns the mode of compliance with a subpoena — that is, whether retention may be ordered. Since appellant has not yet complied with the subpoena, and the Grand Jury has not yet gained possession of the materials sought, it would make little sense to apply the law prior to July 19, 1977. The validity of the legal process itself not being at issue, the mode of compliance should conform to present law.

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

Chief Judge Breitel and Judges Gabrielli, Jones, Wachtler, Fuchsberg and Cooke concur.

Order affirmed.