text:
    The People of the State of New York, Appellant, v Ross Kelly, Respondent.
    Decided December 27, 1990

      APPEARANCES OF COUNSEL

      Robert Morgenthau, District Attorney (Alexei Schacht of counsel), for appellant.

      John Gemmill and Philip L. Weinstein for respondent.
   OPINION OF THE COURT

Memorandum.

The order of the Appellate Division should be affirmed.

Defendant’s conviction for robbery in the first degree was properly reversed. It was error for the trial court to give the jury a verdict sheet, over defendant’s objection, that, in addition to listing the charged crimes, also listed some of the robbery counts’ statutory elements (People v Taylor, 76 NY2d 873; People v Nimmons, 72 NY2d 830). "Since such an error creates a risk that the jury’s deliberative process will be unfairly skewed it puts in serious question the reliability of the ultimate guilt determination (see, People v Owens, 69 NY2d 585, 590-591).” (People v Taylor, supra, at 874.) Further, contrary to the People’s contention, defendant’s conviction for criminal possession of a weapon in the second degree was also properly reversed, even though the verdict sheet did not list any of that crime’s elements. Since the weapon possession count was factually related to the robbery count, it too may have been affected by the improper notations on the verdict sheet (see, People v Cohen, 50 NY2d 908, 911).

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

On review of submissions pursuant to section 500.4 of the Rules of the Court of Appeals (22 NYCRR 500.4), order affirmed in a memorandum.


source: Caselaw Access Project

license: Public Domain

text:
    John B. Bell, Appellant, v New York Higher Education Assistance Corporation et al., Defendants, and Chemical Bank, Respondent.
    Submitted December 3, 1990;
    decided December 27, 1990
   Motion for reargument denied. Cross motion for sanctions denied. [See, 76 NY2d 930.]


text:
    The People of the State of New York ex rel. George S. Crandall, Appellant, v Bernard T. Waldron, as Sheriff of Schenectady County, Respondent.
    Submitted November 13, 1990;
    decided December 27, 1990
   On the Court’s own motion, appeals taken as of right dismissed, without costs, upon the ground that no substantial constitutional question is directly involved. Motion for leave to appeal denied.


text:
    The People of the State of New York, Respondent, v Gary Mongen, Appellant.
    Submitted November 13,1990;
    decided December 27, 1990
   Motion to dismiss appeal granted and appeal dismissed upon the ground that defendant is not presently available to obey the mandate of the Court of Appeals in the event of an affirmance (see, People v Jiminez, 71 NY2d 963; People v Burger, 70 NY2d 828; Matter of Robert E, 68 NY2d 980; People v Sullivan, 28 NY2d 900; People v Del Rio, 14 NY2d 165; People v Genet, 59 NY 80).


text:
    City of New York, Respondent, v Karuna N. Roy et al., Appellants.
    Submitted November 13,1990;
    decided December 27, 1990
   Motion for leave to appeal dismissed upon the ground that this Court does not have jurisdiction to entertain the motion (NY Const, art VI, § 3; CPLR 5602 [a]).


text:
    In the Matter of the City of New York, Respondent, v Unsafe Building and Structure at 21 Richmond Avenue, Staten Island; Joseph Geronimo, Jr., Appellant.
    Submitted November 13,1990;
    decided December 27, 1990
   Motion, insofar as it seeks leave to appeal from so much of the Appellate Division order dated September 7, 1990 as dismissed the appeal from the April 21, 1988 order of Supreme Court, dismissed upon the ground that no appeal lies from an Appellate Division order dismissing an appeal from a determination entered upon a default (CPLR 5511). Motion, insofar as it seeks leave to appeal from the remaining portion of the September 7, 1990 Appellate Division order, dismissed upon the ground that that portion of the order does not finally determine the proceeding within the meaning of the Constitution. Motion, insofar as it seeks leave to appeal from the Appellate Division order dated October 18, 1990, dismissed upon the ground that the order sought to be appealed from does not finally determine the proceeding within the meaning of the Constitution.


text:
    In the Matter of State Farm Mutual Insurance Company, Respondent, v Miriam Donath, Appellant.
    Submitted December 17,1990;
    decided December 27, 1990
   Appeal dismissed, without costs, by the Court of Appeals sua sponte, upon the ground that no appeal lies as of right from the unanimous order of the Appellate Division absent the direct involvement of a substantial constitutional question (CPLR 5601).


text:
    Scott Sutherland, an Infant, by His Mother and Natural Guardian, Jayceline Sutherland, et al., Respondents, v County of Nassau, Appellant.
    Submitted October 15,1990;
    decided December 27, 1990
   Motion for leave to appeal dismissed upon the ground that simultaneous appeals do not lie to both the Appellate Division and the Court of Appeals.


author: Hancock, Jr., J.

text:
    In the Matter of Johnson Newspaper Corporation, Doing Business as Watertown Daily Times, Appellant, v Joseph Melino, as Supervisor of the Office of Professional Discipline, New York State Department of Education, et al., Respondents.
    Argued October 18, 1990;
    decided November 27, 1990

      POINTS OF COUNSEL

      S. Paul Battaglia for appellant.

      Charles E. O’Brien and Lizette A. Cantres for Joseph Melino and another, respondents.
   OPINION OF THE COURT

Hancock, Jr., J.

In this CPLR article 78 proceeding petitioner, the publisher of a Watertown newspaper, seeks an order compelling public access to a disciplinary hearing involving a dentist, a licensed professional supervised by the Board of Regents under article 130 of the Education Law. Supreme Court dismissed the proceeding and the Appellate Division affirmed. Petitioner’s appeal presents two questions:

(1) whether there is a public right of access to such a professional disciplinary hearing under the Federal or State Constitution; and

(2) if not, whether there is a common-law right of access to the proceedings grounded in the public policy of this State.

For reasons which will appear, we answer both questions in the negative and, therefore, affirm.

I

Professional disciplinary proceedings under Education Law § 6510 generally involve a three-part process. At the first stage, the Education Department’s Office of Professional Discipline (OPD) conducts an adversarial hearing on the charges of misconduct (Education Law §6510 [3] [c]). Thereafter, the hearing panel prepares a written report, which includes a recommendation of guilty or not guilty, and, if necessary, a penalty recommendation (§ 6510 [3] [d]). The Regents’ review committee reviews the report and the hearing transcript, and prepares a written report of its own (§ 6510 [4] [b]). The two reports and the hearing transcript are then forwarded to the Board of Regents which renders a final decision (§ 6510 [4] [c]). It is the petitioner’s claimed right of access to the OPD hearing that is at issue on this appeal.

Petitioner Johnson Newspaper Corporation is the publisher of the Watertown Daily Times. In 1988, petitioner sought access to the disciplinary hearing involving a dentist who was charged with misconduct. The OPD refused this request, stating that it was the policy of the Board of Regents to conduct closed professional disciplinary hearings unless the accused professional specifically requested an open hearing. Petitioner thereafter commenced this article 78 proceeding seeking a judgment enjoining enforcement of this policy and declaring professional disciplinary hearings presumptively open to the press and public.

Supreme Court held that professional disciplinary hearings are not presumptively open. It reasoned that the general policy favoring open administrative hearings did not apply in the disciplinary context where different considerations favor confidentiality. Supreme Court also concluded there was no constitutional right of public access to such hearings. The Appellate Division, with one Justice dissenting, affirmed in an opinion (see, Matter of Johnson Newspaper Corp. v Melino, 151 AD2d 214).

II

In addressing petitioner’s argument that there is a constitutionally based public right of access to a professional disciplinary hearing (US Const 1st Amend), the Appellate Division applied what it described as the Supreme Court’s two-tiered test. The test, the court stated, quoting Press-Enterprise Co. v Superior Ct. (478 US 1), "includes 'whether the place and process have historically been open to the press and general public’ and 'whether public access plays a significant positive role in the functioning of the particular process in question’ (supra, at 8).” (Matter of Johnson Newspaper Corp. v Melino, supra, at 216.) The Appellate Division concluded that there is no First Amendment right of access inasmuch as there is "no historical basis for open professional disciplinary hearings” (id., at 216) and no showing that "the public played a significant role in the licensing or policing of professionals.” (Id., at 216.) Petitioner’s primary contention here is that the first step in the Appellate Division’s analysis — whether there exists an historical tradition of openness — is no longer a valid criterion of whether access is protected by the First Amendment. We disagree and conclude that the test as applied by the Appellate Division remains valid.

The two most recent Supreme Court opinions dealing with the First Amendment right of access are Press-Enterprise Co. v Superior Ct. of Cal. (Press-Enterprise I) (464 US 501 [upholding First Amendment right of access for voir dire proceeding in a criminal trial]) and Press-Enterprise Co. v Superior Ct. (Press-Enterprise II) (478 US 1, supra [First Amendment right of access for preliminary hearing in criminal case]). There is no basis in either opinion for concluding that the Supreme Court no longer relies on the historical tradition of access as a significant consideration in determining whether a particular proceeding should receive First Amendment protection.

On the contrary, in Press-Enterprise I, Chief Justice Burger, writing for eight members of the Court, resummarized the thorough exigesis given in his plurality opinion in Richmond Newspapers v Virginia (448 US 555 [upholding First Amendment right of access to criminal trials generally]) concerning the tradition of access as developed in the evolution of the Anglo-American criminal jury trial from its earliest roots in pre-Norman England. The Court determined that the convention of openness — which it had earlier held in Richmond Newspapers v Virginia (supra) and Globe Newspaper Co. v Superior Ct. (457 US 596) existed for criminal trials generally —applied, as well, to the jury selection process. In so holding, the Court in Press-Enterprise I observed that the "historical evidence” reveals that "since the development of trial by jury, the process of selection of jurors has presumptively been a public process with exceptions only for good cause shown.” (464 US, at 505.)

Again, in Press-Enterprise II, Chief Justice Burger, in an opinion for seven members of the Court, noted that the Court in dealing with the First Amendment right of access to criminal proceedings had "emphasized” as one of two complementary considerations "whether the place and process have historically been open to the press and general public.” (478 US, at 8 [emphasis added].) In deciding that preliminary proceedings should be open to the public the Court pointed out that "there has been a tradition of accessibility to preliminary hearings of the type conducted in California.” (478 US, at 10.)

To be sure, as petitioner notes, there are indications in some cases that the tradition of openness should not be treated as an important factor in determining whether there is a First Amendment right of access to a particular type of proceeding (see, e.g., Globe Newspaper Co. v Superior Ct., supra, at 605, n 13; United States v Criden, 675 F2d 550, 555 [3d Cir 1982] [access to pretrial criminal proceedings]; United States v Chagra, 701 F2d 354, 363 [5th Cir 1983] [access to bail reduction hearings]; Newman v Graddick, 696 F2d 796 [11th Cir 1983] [hearings in class action involving overcrowding of prisons]). But many of these decisions predate Press-Enterprise I and Press-Enterprise II in which the court now seems clearly to have settled on a two-part test which gives full effect to the historical component (see, Note, What Ever Happened To The Right To Know?: Access To Government-Controlled Information Since Richmond Newspapers, 73 Va L Rev 1111, 11181122).

The Supreme Court has yet to hold that there is a First Amendment right of access to civil judicial trials (but see, Richmond Newspapers v Virginia, supra, at 580, n 17 ["that historically both civil and criminal trials have been presumptively open”]; Gannett Co. v DePasquale, 443 US 368, 386, n 15 ["(f)or many centuries, both civil and criminal trials have traditionally been open to the public”]). Some Federal Courts of Appeals, however, have held that there is a constitutional right of access to civil trials and, in doing so, have relied specifically on the historical tradition of openness (see, e.g., Publicker Indus. v Cohen, 733 F2d 1059, 1066-1070 [3d Cir 1984] [hearings on motions in corporate litigation]; Brown & Williamson Tobacco Corp. v Federal Trade Commn., 710 F2d 1165, 1178 [6th Cir 1983], cert denied 465 US 1100 [suit against FTC challenging proposed changes in testing procedures]; Westmoreland v Columbia Broadcasting Sys., 752 F2d 16, 23 [2d Cir 1984], cert denied sub nom. Cable News Network v United States Dist. Ct., 472 US 1017 [upholding First Amendment right to attend civil trials but rejecting right to televise trials as "a leap that is not supported by history”]). The one case cited by petitioner dealing with access to administrative proceedings (Society of Professional Journalists v Secretary of Labor, 616 F Supp 569 [D Utah 1985], appeal dismissed and judgment below vacated and remanded as moot 832 F2d 1180 [10th Cir 1987]) does not support the proposition that the historical tradition of openness is without significance. Indeed, the court specifically noted that "to the extent that there is a tradition of holding this type of hearing, there is a tradition that the hearings have been open to the public.” Id., at 575.)

Here, because there is no suggestion that professional disciplinary hearings have any tradition of being open to the public and no showing that the public access plays "a significant positive role” in the functioning of the proceedings (Press-Enterprise II, supra, at 8; see infra, at 9-11), we conclude that the Appellate Division properly held that there is no First Amendment right of access. Petitioner argues, nevertheless, that irrespective of the existence of a First Amendment right, we should hold that there is a right of access under the broader protections afforded by our State Constitution (NY Const, art I, § 8). Although our Court has in some cases found our State Constitution to be more protective of expressional freedoms than the Federal Constitution (see, e.g., O’Neill v Oakgrove Constr., 71 NY2d 521, 528-529, 531 [Kaye, J., concurring]), there is no such precedent with respect to the right of access. Petitioner has cited no authority and makes no persuasive argument for the proposition that our State Constitution affords a protected right of access to disciplinary hearings, and we decline to so hold.

Ill

Petitioner argues that, notwithstanding the absence of a Federal or State constitutional right, a presumptive right of access to professional disciplinary hearings exists in the common law of this State. It relies principally on Matter of Herald Co. v Weisenberg (59 NY2d 378) where the Court held that unemployment compensation hearings should be presumptively open. There, the Court discerned no basis "for setting aside the strong public policy in this State of public access to judicial and administrative proceedings” (id., at 381) and noted specifically that there is nothing in the statutes or departmental regulations governing unemployment compensation hearings suggesting that they should be closed. The Court reasoned: "That section 537 concerns only disclosure of information acquired through the reporting requirements of article 18, and not closure of hearings, is emphasized by the language of the provisions dealing with hearings. Section 622 and the regulation promulgated thereunder (12 NYCRR 461.4) set forth in some detail the procedures and rules to be followed at such hearings, yet neither mentions closure. In light of the failure of either the Legislature or the commissioner to provide for closing unemployment compensation hearings, it would be inappropriate to read into section 537 a blanket order of closure. Moreover, this conclusion is consistent with the position of the Department of Labor on this appeal that it had no objection to the presence of the press at the hearing, as well as with the long-standing position of the Attorney-General (1959 Opns Atty Gen 80).” (Id., at 382-383.)

The rationale of Weisenberg, we believe, leads to the conclusion that professional disciplinary hearings held pursuant to Education Law § 6510 are not presumptively open. In Weisenberg, not only was there nothing in the statute or regulations indicative of a policy of confidentiality, but the posture of the Commissioner of Labor and the long-standing position of the Attorney-General (1959 Opns Atty Gen 80) were supportive of a policy of public access to such hearings. Here, by contrast, the applicable statute (see, Education Law § 6510 [8]) manifests a governmental policy of preserving the confidentiality of information pertaining to disciplinary proceedings until a determination has been reached. The same policy of confidentiality is reflected in analogous statutes pertaining to disciplinary proceedings in the legal profession (see, Judiciary Law § 90 [10]), the medical profession (see, Public Health Law § 230 [10], [11] [a]; Education Law § 6510-a), and to disciplinary hearings conducted by the State Commission on Judicial Conduct (see, Judiciary Law § 44 [4]).

Moreover, in the case of professional disciplinary hearings conducted under article 130 of the Education Law, as distinguished from unemployment compensation hearings held under article 18 of the Labor Law (see, Matter of Herald Co. v Weisenberg, supra, at 383), the established policy of the Board of Regents has been to keep the proceedings private until final determination unless the respondent requests otherwise. And the difference in the policy considerations underlying professional disciplinary hearings and unemployment compensation hearings is displayed in the contrasting conclusions reached by the Attorney-General to the effect that unemployment compensation hearings should be open (1959 Opns Atty Gen 80 [Feb. 16, 1959]) while in professional disciplinary proceedings predecisional materials may be withheld under the Freedom of Information Law (1984 Opns Atty Gen 49, No. 84-F14 [Dec. 3,1984]).

Petitioner points out, nevertheless, that there is no specific statutory or regulatory requirement that professional disciplinary hearings be closed and argues that in the absence of such requirement we should give effect to the prevailing State policy by ordering that hearings of this kind be open. It is true that Education Law § 6510 (8) imposes a requirement of confidentiality on the files of the department concerning possible instances of professional misconduct or unlawful practice and not on the actual conduct of hearings. But under statutes prescribing disciplinary procedures in analogous contexts, the existence of a requirement for confidential hearings has been assumed despite a similar absence of any specific provision mandating closure (see, Matter of Capoccia, 59 NY2d 549, 553 [attorney’s request that hearing be open should be granted in absence of good cause shown where attorney has expressly waived confidentiality requirement]; Matter of Lazachek v Board of Regents, 101 AD2d 639, 641, lv denied 63 NY2d 608 [holding, by implication that medical doctor has a right to a closed disciplinary hearing]; Matter of Doe v Axelrod, 123 AD2d 21, 30, revd on other grounds 71 NY2d 484 [recognizing that the patient as well as the physician has an interest in insuring confidentiality of the disciplinary proceedings]; see also, Sinicropi v County of Nassau, 76 AD2d 832, lv denied 51 NY2d 704 [materials pertaining to disciplinary proceedings against probation officer including hearing transcript exempt under Freedom of Information Law (Public Officers Law § 87 [2] [g] [iii]) as intraagency predecisional memoranda]).

We conclude that our statutes and case law reflect a policy of keeping disciplinary proceedings involving licensed professionals confidential until they are finally determined. The policy serves the purpose of safeguarding information that a potential complainant may regard as private or confidential and thereby removes a possible disincentive to the filing of complaints of professional misconduct (see, Matter of Doe v Axelrod, 123 AD2d 21, 29-30, 36-38 [Sullivan, J., dissenting], revd on other grounds 71 NY2d 484, supra; Landmark Communications v Virginia, 435 US 829, 835-836). The State’s policy also evinces a sensitivity to the possibility of irreparable harm to a professional’s reputation resulting from unfounded accusations — a possibility which is enhanced by the more relaxed nature of the procedures and evidentiary rules followed in disciplinary proceedings in which hearsay evidence may be received. Indeed, our Court has recognized that professional reputation "once lost, is not easily restored.” (See, People ex rel. Karlin v Culkin, 248 NY 465, 478.)

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

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

Order affirmed, with costs.

      . The record does not reveal the precise nature of these charges.

      . Education Law § 6510 (8) provides: "The files of the department relating to the investigation of possible instances of professional misconduct, or the unlawful practice of any profession licensed by the board of regents, or the unlawful use of a professional title or the moral fitness of an applicant for a professional license or permit, shall be confidential and not subject to disclosure at the request of any person, except upon the order of a court in a pending action or proceeding. The provisions of this subdivision shall not apply to documents introduced in evidence at a hearing held pursuant to this chapter and shall not prevent the department from sharing information concerning investigations with other duly authorized public agencies responsible for professional regulation or criminal prosecution.” (Emphasis added.)

      . Section 90 (10) of the Judiciary Law requires that all papers, records, and documents relating to attorney disciplinary matters be deemed confidential unless either the charges of misconduct are sustained or the Justices of the Appellate Division, upon a showing of good cause, decide to make these materials public. Section 230 of the Public Health Law requires that patient records used in connection with physician disciplinary matters remain confidential unless the patient specifically consents to disclosure (Public Health Law § 230 [10] [l]), and the section also prohibits disclosure of any reports or complaints of misconduct made to the State Board of Professional Medical Conduct (Public Health Law § 230 [11] [a]).


author: Simons, J.

text:
    In the Matter of Binghamton GHS Employees Federal Credit Union et al., Respondents, v State Division of Human Rights et al., Appellants. Estate of Theresa M. Yadlosky, Necessary Party.
    Argued October 11, 1990;
    decided November 27, 1990

      POINTS OF COUNSEL

      Caroline J. Downey and Lawrence Kunin for appellants.

      Donald W. O’Brien, Jr., for Binghamton GHS Employees Federal Credit Union and another, respondents.

      Richard H. Block, David J. Weisenfeld and Elizabeth A. Barasch for Insurance Department of the State of New York, respondent.
   OPINION OF THE COURT

Simons, J.

The Human Rights Law prohibits discrimination on the basis of sex in "the fixing of the rates, terms or conditions of * * * any form of credit” (Executive Law § 296-a [1] [b]). The issue in this proceeding is whether an auto loan agreement violates this statutory prohibition if it contains an option to purchase disability insurance for the duration of the loan which excludes coverage for disabilities caused by normal pregnancy. We conclude that it does.

I

In October 1982, Theresa Yadlosky obtained a car loan from petitioner Binghamton GHS Employees Federal Credit Union by executing a combined one-page application form and promissory note. The application contained an option for credit health and disability insurance to be exercised by the borrower placing an "x” in a designated box. Ms. Yadlosky elected the option and the premium of $388.48 was included in the principal and amortized over the life of the loan as a part of her installment payments. She later received an insurance policy written by PHF Life Insurance Company and administered by petitioner Richard J. Katz & Co., Inc., an insurance broker. Under the terms of the insurance policy, benefits were available to pay monthly loan installments if the insured became disabled and was unable to do so. The policy excluded benefits, however, "if the debtor becomes disabled due to a normal pregnancy.”

Ms. Yadlosky filed claims under the policy, in January 1984 and March 1985, for six-week disabilities caused by two normal pregnancies. They were denied because of the pregnancy exclusion. Ms. Yadlosky then filed complaints against Binghamton and Katz with the State Division of Human Rights alleging that denial of her claims constituted unlawful discrimination in the terms and conditions of credit based on sex. The Administrative Law Judge found for Ms. Yadlosky and ordered Binghamton and Katz to pay compensatory damages of $669.28 for the two disability periods. The Commissioner of the Division of Human Rights agreed, holding that the disability insurance policy was so "inextricably intertwined with the auto car loan” that it constituted a "term and condition” of credit and violated the Human Rights Law (see, Executive Law § 296-a [1] [b]).

Binghamton, Katz and the New York State Insurance Department commenced an article 78 proceeding to annul the determination of the Division of Human Rights and a divided Appellate Division granted their petition. The majority held that the Division of Human Rights lacked subject matter jurisdiction, concluding that because the insurance was optional the insurance transaction did not implicate a "term or condition” of credit within the meaning of the Human Rights Law. The majority also noted that the provisions of the policy complied with Insurance Department regulations (see, 11 NYCRR 185.5 [f] [2] [i]). Justice Lawton dissented, concluding that the insurance was a "term” of credit and that the exclusion was proscribed by the Human Rights Law. We granted leave to appeal.

II

The Insurance Department has the statutory power and duty to determine whether policy premiums are rationally related to risks and expenses (Insurance Law §3201 [c] [3]) and to eliminate discriminatory practices in the writing of insurance (see, Insurance Law §§ 2606, 2607, 4224; 11 NYCRR 185.5 [f] [2] [i]). It contends, therefore, that the Division of Human Rights order affecting health and disability insurance intrudes on its exclusive jurisdiction over this dispute. We disagree.

The Legislature has given the Division of Human Rights jurisdiction over discrimination matters; it has the primary responsibility to "receive, investigate and pass upon” claimed discriminatory practices which violate the Human Rights Law (Executive Law § 295 [6] [a]; § 290; Matter of Board of Higher Educ. v Carter, 14 NY2d 138, 145-146). Moreover, we have held that singling out pregnancy for different treatment from other physical or medical disabilities discriminates on the basis of sex and is prohibited in areas addressed by the Human Rights Law (Brooklyn Union Gas Co. v New York State Human Rights Appeal Bd., 41 NY2d 84, 86; Union Free School Dist. No. 6 v New York State Human Rights Appeal Bd., 35 NY2d 371, 375). Accordingly, the Division has the power to investigate and decide Ms. Yadlosky’s claim that the insurance option was a discriminatory term of credit under the Human Rights Law (see, Executive Law § 296-a [1] [b]; cf., Matter of Imperial Diner v State Human Rights Appeal Bd., 52 NY2d 72, 77). Even if it ultimately determined that there was no merit to the claim, it nevertheless had the authority to pass on its validity.

III

Turning to the merits, petitioners contend that the disability insurance exclusion was not a "term or condition * * * of credit” within the provisions of the statute because the coverage was optional with the debtor. While the insurance was not a "condition” of credit under the circumstances, it was indeed a "term” of the credit included in the credit agreement and an integral part of the loan transaction. The insurance was offered in the one-page credit agreement and promissory note used by Binghamton; it was available with every installment loan and the duration of every policy was keyed to the amount and duration of the loan. Moreover, the insurance was available only as a part of a credit transaction. Although Ms. Yadlosky could have obtained similar insurance from another source, the insurance she obtained from Binghamton was offered only to borrowers, as a part of the credit agreement, not to the public generally. Further, the insurance premium was incorporated into the loan. It was computed and added into the monthly installment payments and then collected by the creditor with the interest and principal of the loan. Binghamton paid the insurer at the outset and charged interest to Ms. Yadlosky on the insurance premium at 16%, the same rate charged on the debt, keeping the interest and thus making a profit on the premium.

Based upon these facts, the determination of the Commissioner that the disability insurance provision was "inextricably intertwined” with the loan agreement and a "term” of credit was not arbitrary and capricious. Inasmuch as a woman could not obtain credit on the same terms from Binghamton as a man, i.e., she was denied the opportunity to obtain full disability protection because of her sex, the credit agreement violated the statutory proscription against discrimination. That the borrower could have obtained the loan without any insurance or with insurance purchased from another source is irrelevant. We construe section 296-a (1) (b) liberally to encompass optional as well as mandatory benefits of insurance coverage to effectuate the purposes of this remedial statute prohibiting discrimination (see, Executive Law § 300; New York Inst. of Technology v State Div. of Human Rights, 40 NY2d 316, 324-325; Holly v Pennysaver Corp., 98 AD2d 570, 572-573). It is appropriate, therefore, to apply the statutory proscription against discrimination to all provisions of a credit offering, not simply those which are mandatory (cf., Arizona Governing Comm. v Norris, 463 US 1073, 1081, n 10). A lender may not, as a part of its regular loan procedures, offer a disability benefits policy, whether optional or not, that discriminates on the basis of sex (see, Executive Law § 296-a [1] [b]).

Accordingly, the order of the Appellate Division should be reversed, with costs, and the determination of the Division of Human Rights reinstated.

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

Order reversed, etc.

       The Human Rights Law (Executive Law § 296-a [1]) provides: ”[i]t shall be an unlawful discriminatory practice for any creditor or any officer, agent or employee thereof * * * [b] [t]o discriminate in the granting, withholding, extending or renewing, or in the fixing of the rates, terms or conditions of, any form of credit, on the basis of * * * sex” (emphasis added).


author: Titone, J.

text:
    The People of the State of New York, Respondent, v Jessie Dunn, Appellant.
    Argued October 18, 1990;
    decided November 29, 1990

      POINTS OF COUNSEL

      Burton Ritter for appellant.

      Kevin M. Dillon, District Attorney (John J. DeFranks and J. Michael Marion of counsel), for respondent.
   OPINION OF THE COURT

Titone, J.

In recent years, law enforcement officers have increasingly turned to specially trained dogs to assist them in their efforts in the "war against drugs.” The present appeal raises the question of whether the use of these "canine cannabis connoisseurs” — as they have been termed — to detect the presence of controlled substances in a person’s apartment is subject to the strictures of the Fourth Amendment of the Federal Constitution or article I, § 12 of the New York State Constitution. For the reasons that follow, we conclude that while the use of such dogs does not implicate the protections of the Fourth Amendment, our State Constitution requires that the police have at least a reasonable suspicion that a residence contains illicit contraband before this investigative technique may be employed.

I

In May of 1988, prompted by information that controlled substances were being kept in an apartment leased by defendant in Hamburg, New York, the police arranged to have a trained narcotics detection dog brought to the common hallway outside his apartment door so that a "canine sniff” could be conducted. Upon its arrival, the dog "alerted,” indicating the presence of drugs inside the apartment. Based on the dog’s reaction, as well as their prior information, the police obtained a warrant to search the apartment. This search re-suited in the seizure of large quantities of cocaine and marihuana, various items of drug paraphernalia and two handguns. Relying in part on the success of that search, the police then obtained a second warrant to search another of defendant’s apartments, this one located in Cheektowaga, New York. That search also resulted in the seizure of cocaine and marihuana, as well as additional items of drug paraphernalia.

A nine-count indictment was subsequently returned against defendant charging him with, among other things, various drug-related offenses. Prior to trial, defendant moved to suppress all of the items of evidence which had been seized during the two searches. In support of his motion, defendant argued that the search warrants in question had been improperly issued insofar as they were based on the result of the "canine sniff” conducted outside his apartment door, which he asserted itself constituted an unlawful warrantless search unsupported by probable cause. Defendant’s motion was denied, and he was subsequently convicted after a jury trial.

On appeal, the Appellate Division affirmed. A two-Justice plurality declined to hold the "canine sniff” in question to be a search within the meaning of either the Federal or our State Constitution. Although the plurality’s holding obviated the need to determine if the police had any basis for subjecting defendant’s apartment to this investigative device, they nevertheless noted that a reasonable suspicion did exist. Justice Lawton, although concurring with the plurality’s holding that the "canine sniff” was not unlawful, disagreed that it did not constitute a search. He, however, believed that such a procedure, since it was minimally intrusive, needed to be supported only by a reasonable suspicion, which he, like the plurality, found to exist. The dissent, on the other hand, focusing on the sanctity of the home, thought that both a warrant and probable cause should be required. A Justice of the Appellate Division granted defendant leave to appeal to this Court. We now affirm, but solely on the ground that the police had a reasonable suspicion that defendant’s apartment contained illicit contraband.

II

We first turn to defendant’s contention that his rights under the Federal Constitution were violated. Our analysis here must begin with an examination of United States v Place (462 US 696). There, the Supreme Court addressed the issue of whether the exposure of a person’s luggage, while at an airport, to a specially trained narcotics detection dog constituted a search within the meaning of the Fourth Amendment. In holding this investigative method not to be a search, the court primarily focused on its discriminate and nonintrusive character, particularly the extremely limited nature of the information revealed by such a procedure. As Justice O’Con-nor, writing for the majority, stated: "A 'canine sniff by a well-trained narcotics detection dog * * * does not expose noncontraband items that otherwise would remain hidden from public view, as does, for example, an officer’s rummaging through the contents of [a person’s] luggage. Thus, the manner in which information is obtained through this investigative technique is much less intrusive than a typical search. Moreover, the sniff discloses only the presence or absence of narcotics, a contraband item. Thus, despite the fact that the sniff tells the authorities something about the contents of the luggage, the information obtained is limited.” (462 US, at 707; see also, United States v Jacobsen, 466 US 109, 123 ["governmental conduct that can reveal whether a substance is cocaine, and no other arguably 'private’ fact, compromises no legitimate privacy interest”, and thus, does not constitute a search within the meaning of the Fourth Amendment].)

In light of the rationale adopted by the Supreme Court in Place, and reaffirmed in Jacobsen, we reject defendant’s contention that his Federal constitutional rights were violated. Since the "canine sniff’ conducted outside his apartment could reveal only the presence or absence of illicit drugs, it did not constitute a search within the meaning of the Fourth Amendment. Although the Second Circuit, in United States v Thomas (757 F2d 1359 [2d Cir], cert denied sub nom. Wheelings v United States, 474 US 819), held Place inapplicable to "residential sniffs,” we find its attempt to distinguish that case unpersuasive (see, United States v Colyer, 878 F2d 469, 475 [DC Cir] [questioning the correctness of the Thomas decision]). The distinction it relies upon, namely, the heightened expectation of privacy that a person has in his residence, is irrelevant under Place’s rationale (see, United States v Jacobsen, supra, at 140 [Brennan, J., dissenting]; cf., People v Price, 54 NY2d 557, 563). Whether or not there exists a heightened expectation of privacy, the fact remains that a "canine sniff’ reveals only evidence of criminality (see, United States v Place, supra, at 707; see also, United States v Jacobsen, supra, at 122-124). Since that was the factor that was determinative in Place, we conclude that its holding is controlling even where the target of the “canine sniff” is a residence.

Ill

Having determined that defendant’s rights under the Federal Constitution (US Const 4th Amend) were not violated, we now turn to the question of whether our State Constitution provides greater protections (NY Const, art I, § 12). Initially, we note that our decision in People v Price (54 NY2d 557, supra) is not dispositive of this issue. Price, like the Supreme Court’s decision in Place, involved the exposure of a person’s luggage, located at an airport, to a trained canine’s nose. However, in declining to find that particular procedure to be a search under our State Constitution, we, unlike the Place court, primarily focused on the reduced expectation of privacy that a person has with regard to the luggage he places in the hands of a common carrier (54 NY2d, at 563). Nowhere in Price did we even intimate that the investigative tool employed there did not constitute a search because it could disclose only the presence or absence of contraband.

We now must decide whether we should adopt the Place rationale as a matter of State constitutional law. At the outset, we note that in the past this Court has not hesitated to interpret article I, § 12 independently of its Federal counterpart when the analysis adopted by the Supreme Court in a given area has threatened to undercut the right of our citizens to be free from unreasonable government intrusions (see, People v P. J. Video, 68 NY2d 296, on remand from New York v P. J. Video, 475 US 868; People v Class, 67 NY2d 431, on remand from New York v Class, 475 US 106; People v Bigelow, 66 NY2d 417; People v Johnson, 66 NY2d 398; People v Gokey, 60 NY2d 309). Because we conclude that the Place analysis does just that, we decline to follow it.

Unlike the Supreme Court, we believe that the fact that a given investigative procedure can disclose only evidence of criminality should have little bearing on whether it constitutes a search. Notwithstanding such a method’s discriminate and nonintrusive nature, it remains a way of detecting the contents of a private place (see, United States v Jacobsen, supra, at 140-141 [Brennan, J., dissenting]; United States v Thomas, supra, at 1366-1367; see also, Gutterman, A Formulation of the Value and Means Models of the Fourth Amendment in the Age of Technologically Enhanced Surveillance, 39 Syracuse L Rev 647, 707-711 [1988]). Thus, our analysis should more appropriately focus on whether there has been an intrusion into an area where an individual has a reasonable expectation of privacy. Once our inquiry is so directed, it becomes clear that the use of the trained canine outside defendant’s apartment constituted a search. By resorting to this investigative technique, the police were able to obtain information regarding the contents of a place that has traditionally been accorded a heightened expectation of privacy (see, People v Levan, 62 NY2d 139, 144 [citing Payton v New York, 445 US 573]). While it is true that the canine only sniffed the air outside defendant’s apartment, that fact is not dispositive. Indeed, the odors emanating from the premises were not unlike the sound waves which were harnessed by the electronic surveillance equipment in Katz v United States (389 US 347). Each originated "inside a private area and traveled] beyond its perimeters” (People v Price, supra, at 565 [Meyer, J., concurring]), unexposed to all except those with supersensitive detection devices (see, 1 LaFave, Search and Seizure § 2.2 [f], at 367-368 [2d ed]).

Thus, we conclude that the "canine sniff” in question here was a search within the meaning of article I, § 12 of our State Constitution. To hold otherwise, we believe would raise the specter of the police roaming indiscriminately through the corridors of public housing projects with trained dogs in search of drugs (see, People v Dunn, 155 AD2d 75, 90 [Lawton, J., concurring]; United States v Jacobsen, supra, at 138 [Brennan, J., dissenting]). Such an Orwellian notion would be repugnant under our State Constitution (see, People v Belton, 55 NY2d 49, 52, on remand from New York v Belton, 453 US 454 ["(T)he State Constitution protects the privacy interests of the people of our State * * * against the unfettered discretion of government officials to search or seize.” (Emphasis supplied.)]).

Our conclusion that there was a search, however, does not end the inquiry. As Justice Lawton noted in his concurrence below, a "canine sniff’ is far less intrusive than a full-blown search of a person’s home (155 AD2d, at 90-92 [Lawton, J., concurring]). It does not entail entry into the premises or exposure of one’s personal effects to the police. Given the uniquely discriminate and nonintrusive nature of such an investigative device, as well as its significant utility to law enforcement authorities, we conclude that it may be used without a warrant or probable cause, provided that the police have a reasonable suspicion that a residence contains illicit contraband (see, People v Class, 63 NY2d 491, 495, revd New York v Class, 475 US 106, on remand 67 NY2d 431, supra [noting that since a vehicle identification number inspection is a lesser invasion than a full-blown search a lesser justification than probable cause may be required]; People v Cantor, 36 NY2d 106; 1 LaFave, Search and Seizure § 2.2 [f], at 375 [2d ed]; see also, New Jersey v T.L.O., 469 US 325, 340-341; Terry v Ohio, 392 US 1).

Here it is undisputed that law enforcement authorities had a reasonable suspicion that defendant’s apartment contained illegal drugs. Since this was a sufficient justification for the police, while lawfully in the common hallway outside the apartment, to conduct a "canine sniff,” defendant’s rights under article I, § 12 of our State Constitution were not infringed.

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

Chief Judge Wachtler and Judges Kaye, Alexander and Hancock, Jr., concur with Judge Titone; Judges Simons and Bellacosa concur in result for the reasons stated in the opinion by Justice M. Dolores Denman at the Appellate Division (155 AD2d 75), and stress that in their view the sniff by a trained police dog in the hallway outside defendant’s apartment did not constitute a search within the meaning of the Fourth Amendment of the US Constitution or NY Constitution, article I, § 12.

Order affirmed.

      . LaFave, Search and Seizure § 2.2 (f), at 367 (2d ed).

      . By not having timely raised below the question of whether the police were lawfully in the common hallway outside his apartment when the "canine sniff” was conducted, defendant has failed to preserve this issue for our review.

      . Article I, § 12, like the Fourth Amendment, provides, in pertinent part: "The right of the people to be secure in their persons, houses, papers and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

      . As stated by the court in United States v Thomas (757 F2d 1359, 1366): "It is one thing to say that a sniff in an airport is not a search, but quite another to say that a sniff can never be a search. The question always to be asked is whether the use of a trained dog intrudes on a legitimate expectation of privacy.” Although, as noted earlier, we find the Thomas court’s holding to be wrong as a matter of Federal constitutional law, we nevertheless find much of its analysis to be persuasive in interpreting our State Constitution.

      . The "use of [the] dog [was] not a mere improvement of [the officer’s] sense of smell, as ordinary eyeglasses improve vision, but [was] a significant enhancement accomplished by a different, and far superior, sensory instrument.” (United States v Thomas, 757 F2d 1359,1367.)


text:
    Landoil Resources Corporation, Plaintiff, v Alexander & Alexander Services, Inc., et al., Defendants and Third-Party Plaintiffs. Lloyd’s Syndicate 317 et al., Third-Party Defendants.
    Argued October 18, 1990;
    decided November 20, 1990

      POINTS OF COUNSEL

      John M. Woods and Joseph G. Grasso for Lloyd’s Syndicate 317, third-party defendant.

      Jonathan C. Thau, Thomas W. Hyland, Thomas A. Leghorn and Michael Schwartzberg for defendants and third-party plaintiffs.
   OPINION OF THE COURT

Simons, J.

Plaintiff Landoil Resources Corporation, a Philippine construction company, instituted this action against defendants Alexander & Alexander Services, Inc., et al. (Alexander), a group of United States corporations engaged in the insurance brokerage business. It sought to recover damages allegedly sustained as a result of defendants’ wrongful acts in acquiring two policies of political risk insurance to cover plaintiff's foreign projects. Alexander had secured the insurance from Lloyd’s of London. Accordingly, it asserted third-party claims for indemnification and contribution against Lloyd’s Syndicate 317, a group of insurance underwriters who conduct their underwriting business at Lloyd’s.

The matter comes to us from the United States Court of Appeals for the Second Circuit, which certified the question of whether Syndicate 317 is "doing business” in New York and therefore subject to personal jurisdiction under CPLR 301 (see, 22 NYCRR 500.17). We accepted the certified question and now answer it in the negative.

I

Before addressing the question, it is important to understand how Lloyd’s of London conducts its business.

The Corporation of Lloyd’s is a nonprofit corporation created by a Special Act of Parliament in 1871. It does no underwriting, but instead provides services to members who perform underwriting in their individual capacities. The individual members transact their business in groups called syndicates, managed by agents who in turn employ an active underwriter to handle the business for the syndicate. The managing agent keeps the syndicate’s books while the active underwriter accepts or rejects the risks submitted for underwriting, collects premiums, pays losses and disburses all funds. All the syndicates conduct their business at the market place known as Lloyd’s of London located at One Lime Street, London, England.

Lloyd’s policies can only be obtained by registered Lloyd’s brokers who have been appointed either by the prospective insured or by the insured’s non-Lloyd’s broker. In placing policies, a registered Lloyd’s broker prepares a "slip” which states the details of the insurance required and then offers the risk to the active underwriters. Any underwriter who wishes to underwrite all or a portion of the risk indicates this on the slip. Once the entire risk has been subscribed, the Lloyd’s broker informs its principal that the insurance has been effected. A policy is prepared by Lloyd’s Policy Signing Office, a department of the Corporation of Lloyd’s, and the transaction is consummated.

Landoil’s policies were obtained in this manner. In 1982 and 1983 it requested Alexander to acquire political risk insurance policies covering its operations in the Middle East and Africa. Since Alexander was not a registered Lloyd’s broker, the policies had to be negotiated in London between an appointed Lloyd’s broker and certain Lloyd’s underwriters. Alexander secured the insurance from a group of Lloyd’s underwriters, including Syndicate 317.

Subsequently, disputes arose between Landoil and the various underwriters, including Syndicate 317, over the coverage of certain losses. The claims were settled following arbitration proceedings in London to which Alexander was not a party. Landoil then instituted this action against Alexander in the United States District Court to recover the balance of its loss. Alexander filed a third-party complaint for indemnification and contribution against Syndicate 317 and other Lloyd’s underwriters alleged to have subscribed to Landoil’s policies and Syndicate 317 responded by filing the motion to dismiss the third-party complaint for lack of personal jurisdiction. The District Court denied the motion to dismiss, holding that Syndicate 317 was "doing business” in New York within the meaning of CPLR 301 (Landoil Resources Corp. v Alexander & Alexander, 720 F Supp 26).

The court rested its decision on the existence of a fund held in trust at Citibank in New York City by the Corporation of Lloyd’s. The fund, known as the American Trust Fund (Fund), was originally established in 1940 to provide security to United States policyholders during World War II, when England was under siege by Germany. It consists of United States dollar premiums collected worldwide by Lloyd’s brokers and subsequently transferred through Lloyd’s accounting system in London to Citibank in New York. The Fund is used to pay American claims underwritten by Lloyd’s. It also serves as security for New York insureds pursuant to New York Insurance Department regulations which provide that a New York broker or insurance company cannot place New York risks with an unauthorized alien or foreign insurer unless it has ascertained that such insurer maintains a trust fund at a New York bank, in an amount specified by regulation, as security for the insured (see, 11 NYCRR 27.5 [a] [1] [ii]; see also, 125.4 [c]). Thus, the Fund enables New York brokers and insurance companies to submit risks to Lloyd’s underwriting syndicates which are not authorized to write insurance in New York. The Lloyd’s underwriters do not directly deposit or withdraw any moneys from the Fund, but a portion of United States dollar premiums attributable to risks underwritten by groups such as Syndicate 317, including some derived from New York insureds and risks, are part of its assets. The Fund is administered by the Finance & Market Services Group (FMSG), one of Lloyd’s administrative departments and, as of December 31, 1988, it had $9.4 billion dollars on deposit at Citibank.

From these facts, the District Court concluded that FMSG "is performing a service in New York” on behalf of Syndicate 317, by administering — from London — the Lloyd’s American Trust Fund. Inasmuch as the assets of the Fund were in the billions of dollars, the court inferred that the underwriting was substantial and that these activities constituted "doing business” in this State. The court did not rest its ruling on activities of Syndicate 317 in New York, observing that "in the traditional sense of the phrase, they do not themselves 'do business’ anywhere except in London.” (Landoil Resources Corp. v Alexander & Alexander, 720 F Supp 26, 27, supra.) Syndicate 317 appealed to the Second Circuit Court of Appeals and that court certified the question to us. We conclude that Syndicate 317 is not subject to in personam jurisdiction in New York State.

II

A foreign corporation is amenable to suit in New York courts under CPLR 301 if it has engaged in such a continuous and systematic course of "doing business” here that a finding of its "presence” in this jurisdiction is warranted (Laufer v Ostrow, 55 NY2d 305, 309-310; Frummer v Hilton Hotels Intl., 19 NY2d 533, 536; Simonson v International Bank, 14 NY2d 281, 285; accord, Delagi v Volkswagenwerk AG, 29 NY2d 426, 430-431). The test for "doing business” is a "simple [and] pragmatic one,” which varies in its application depending on the particular facts of each case (see, Bryant v Finnish Natl. Airline, 15 NY2d 426, 432; see generally, Siegel, NY Prac §§ 82, 83). The court must be able to say from the facts that the corporation is "present” in the State "not occasionally or casually, but with a fair measure of permanence and continuity” (Tauza v Susquehanna Coal Co., 220 NY 259, 267; see also, Laufer v Ostrow, 55 NY2d 305, 310, supra). That test is not satisfied by the evidence in the record before us.

Alexander’s submission focuses on three general areas.

A

First, Alexander contends that Syndicate 317 is doing business in New York because it underwrites policies for New York insureds and risks. Such activity standing alone, however, will not support jurisdiction. In Delagi v Volkswagenwerk AG (29 NY2d 426, 433, supra), we held that "mere sales of a manufacturer’s product in New York, however substantial, have never made the foreign corporation manufacturer amenable to suit in this jurisdiction.” Delagi involved a German automobile manufacturing corporation which sold its vehicles to a New Jersey importing corporation, a wholly owned subsidiary, which in turn sold them to a corporate wholesale distributor in New York owned by American investors. We concluded that the manufacturer, which was not qualified to do business in this State and did not have an office or place of business here, was not subject to jurisdiction because it had not engaged in a systematic and regular course of business in New York (Delagi v Volkswagenwerk AG, 29 NY2d 426, supra).

Similarly, the sale of insurance policies in New York, which are underwritten by a group of unauthorized foreign underwriters, does not, without more, support a finding that the underwriters are engaging in a systematic and regular course of business in New York (cf., Bryant v Finnish Natl. Airline, 15 NY2d 267, 270, supra [office, staff and bank account in New York constituted doing business]; Tauza v Susquehanna Coal Co., 220 NY 259, supra [office and direct and continuous sales and shipment of goods into New York constituted doing business]). Syndicate 317 does not have an office in New York, it does not solicit business in New York, it has no real or personal property in New York and it does not maintain a bank account in New York. Rather, it conducts its business in London and considers risks brought to it there by registered Lloyd’s brokers. A New York broker may seek to place insurance with Syndicate 317, through a Lloyd’s broker, but Syndicate 317 does not directly or purposefully solicit, sell or promote its underwriting activity in New York.

B

Alexander next contends that Syndicate 317 has sufficient interest in the Lloyd’s American Trust Fund to warrant a finding of its "presence” in New York. It notes that a portion of United States dollar premiums, including income derived from the underwriting of New York risks by Syndicate 317, is deposited in the trust fund and that without it or a similar type of fund, New York brokers and insurance companies could not conduct business with the Syndicate. Syndicate 317’s indirect interest in that Fund does not provide a basis for CPLR 301 jurisdiction, however.

Syndicate 317 does not "maintain an account” at Citibank in the usual sense. Funds cannot be withdrawn from or deposited into the account by Syndicate 317 and it is not administered by Syndicate 317 or the underwriters, but rather by FMSG, an administrative branch of the Corporation of Lloyd’s. But even if it is assumed that Syndicate 317 does "maintain” the account, because a portion of the income derived from the underwriting of New York risks by Syndicate 317 is on deposit there, that alone does not establish that Lloyd’s underwriters do business in New York on a continuous and systematic basis (see, Nemetsky v Banque de Developpement, 48 NY2d 962 [involving a correspondent banking relationship]; see also, Bank of Am. v Whitney Bank, 261 US 171).

Alexander contends that Nemetsky and Whitney are distinguishable because the Fund is not used merely to facilitate underwriting of New York risks, but rather is a functional predicate to Syndicate 317 insuring New York customers or risks. It maintains that this added purpose suffices to support a finding that the Syndicate is "doing business” in New York. To establish jurisdiction under CPLR 301, however, the foreign entity must engage in a continuous and systematic course of activity in this State. Syndicate 317’s only connection with the Fund is that some unknown amount of United States dollar premiums attributable to risks underwritten by it are on deposit in the Fund.

Moreover, the Fund is not maintained for the purpose of allowing Syndicate 317 to take advantage of the New York insurance market. It was established in 1940 to provide security for the payment of valid claims made by all United States holders of insurance policies underwritten at Lloyd’s in London. The fact that the Fund now satisfies the requirements of the New York insurance regulations so that New York brokers and insurers can seek coverage from Lloyd’s underwriters through registered Lloyd’s brokers in London is fortuitous. Whether Lloyd’s would, in the absence of such a fund, establish something similar in its place which might support jurisdiction, is entirely speculative. The existence of a New York trust fund established for the benefit of United States holders of Lloyd’s policies cannot serve as a predicate for exercising jurisdiction over the Lloyd’s underwriters pursuant to CPLR 301 merely because it indirectly benefits Syndicate 317.

C

Finally, Alexander maintains that FMSG is an agent of Syndicate 317 and that its activities in administering the New York account are sufficient to confer jurisdiction over Syndicate 317 under the ruling in Laufer v Ostrow (55 NY2d 305, supra) and other agency cases (see, e.g., Gelfand v Tanner Motor Tours, 385 F2d 116; Frummer v Hilton Hotels Intl., 19 NY2d 533, supra). Assuming that FMSG is an agent of Syndicate 317 because of its administrative activities, more than an agency relationship is needed to support in personam jurisdiction. FMSG is not physically present in New York, it does not solicit business for the Lloyd’s underwriters in New York and it performs all of its administrative functions relating to the Fund from London. It cannot be said to be performing acts in New York on a systematic and continuous basis or for the benefit of Syndicate 317 (cf., Laufer v Ostrow, supra; Frummer v Hilton Hotels Intl., supra).

The plaintiff in this case is a Philippine corporation which was insured by a British insurer for risks in foreign countries. The dispute in the third-party action is between an American broker, not the insured, and the British insurer. Personal jurisdiction in New York between the two must necessarily rest upon the existence of the Citibank account but to hold in favor of Alexander on that basis would subject any foreign insurer to suit in New York merely because of the existence of a security fund, whether the insurer had sold insurance here or not. The facts presented do not support a finding of "doing business” under the New York statute.

Accordingly, the certified question should be answered in the negative.

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

Following certification of a question by the United States Court of Appeals for the Second Circuit and acceptance of the question by this Court pursuant to section 500.17 of the Rules of Practice of the New York State Court of Appeals (22 NYCRR 500.17), and after hearing argument by counsel for the parties and consideration of the briefs and the record submitted, certified question answered in the negative.

      . In ruling on the motion, the District Court considered all of the underwriters to be appearing on the motion. Observing that the motion presented a question of first impression, the District Court certified that such question was one "upon which reasonable minds might differ.” (28 USC § 1292 [b]; 1989 Lexis 13826.) On appeal to the Second Circuit, Syndicate 317 conceded that the motion is in effect a test case for the other Lloyd’s underwriters named in the third-party complaint.

      . This is not to say that the Fund can never serve as a predicate for exercising jurisdiction over a Lloyd’s syndicate. The Fund might, in an appropriate case, serve as a predicate for exercising jurisdiction based on quasi in rem or long-arm principles. Contrary to the third-party plaintiffs’ contention, however, this Court’s analysis in Banco Ambrosiano v Artoc Bank & Trust (62 NY2d 65), which was based on quasi in rem principles, is not equally applicable to "doing business” cases. In Banco, we held that the relationship between the defendant, the litigation and the State was sufficient to make.it fair that defendant be compelled to defend in New York. In distinguishing cases where the maintenance of a bank account in New York was found not to be sufficient to sustain jurisdiction, we stated that the Banco case did not involve property coincidentally located within the State’s borders which formed the only relevant link to defendant; rather, defendant’s account with the New York bank was closely related to plaintiff’s claim making quasi in rem jurisdiction proper under the facts of that case. Here, the Trust Fund does not relate in any way to the direct cause of action or to the third-party complaint.