Actresses as Allies presents a screening of The Paper House Report

 

Actresses As Allies Presents a Screening of The Paper House Report

A documentary film by Nicole Cimino & Jack Boar Pictures

Join us for cocktails and hors d’oeuvres at WIP (Work in Progress) on Wednesday, May 30th at 9:00 PM.

Complimentary Admission.

There will be an AFTERPARTY at WIP following the screening! All attendees are welcome to stay and dance the night away.

***SPACE IS LIMITED, PLEASE RSVP TO: PaperHouseScreening@GMAIL.COM***

The Paper House Report is a 25 minute documentary about Jerry Delakas, a Greek immigrant who immigrated to the United States in the 1970’s. Over the years, Jerry has become an icon of the Cooper Square area and the face of the Astor Place Newsstand, which he has been running for past 25 years. The Paper House Report is the story of his fight to continue running the newsstand after the DCA denied the renewal of the license. Director Nicole Cimino & Jack Boar Pictures teamed up to create The Paper House Report, a documentary which brings awareness to support Jerry and his struggle.

We look forward to seeing you there! 

And follow us on Twitter @paperhousedoc
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The Paper House Report. Thanks to everybody.

Eventually the 25 minutes length documentary about Jerry Delakas is done!

You can watch it here! http://vimeo.com/37930263

I hope you watch it and know more about his story and fingers crossed for the upcoming decision!

Thanks to Alex Arbuckle who first created the petition and the website www.savejerry.com.

Thanks to Bernadette O’Reilly who created the facebook page Jerry’s Newsstand.

Thanks to Suzanne Stack to speak out and release an interview.

Thanks to Gil Santamarina and his passion to win this trial.

Thanks to everyone that signed the petition.

Thanks to people who wrote a line to support Jerry and this fight for justice.

Thanks to hundreds of people who said Save Jerry and love him and thanks to all institutions and newspapers who wrote to support him.

Thank you,

I can’t write all your names but thanks to each one of you to support Jerry:-)

Lily Feldman

“This man is a committed New York citizen. Astor Place would be nothing without him.”

Jim Saylor

“Save Jerry – He’s an Icon.”

Noel Hardy

“Bureaucratic injustice; the order of the day every day in the US.”

Dana Edlund

“You have the power to not destroy a person’s life- do the right thing!”

Toliver-Lyons

“This is an Institution!”

Carroll Armstrong

“Let him keep his stand… he should be grandfathered in!”

Laura Dahlke

“People just do not matter anymore. How could things in our country have sunk to this level, where we would deprive an aging man of his livelyhood for the sake of a piece of paper. Someone with more money must want his spot. It’s unforgivable.”

Penny

“He has proven to be a good businessman and friend and deserves the right to keep running his newsstand.”

Christina Luke

“Do the right thing NY! He’s been there since Astor Diner! He’s been a part of the backdrop of my life since I was a teenager sneaking downtown gallivanting around the village. Whenever I stare at that glass monstrosity, I turn to that stand, see Jerry’s face and know that at least some things don ‘t change. He’s an old man. Just give Jerry the lease!”

Eleni Kostopoulos

“One of the last of the great newsstands- a NYC staple that we are sadly losing day by day.”

Evelyn L. Wilson

“Sometimes the Mayor needs to step in and do the right thing and transfer that title to Jerry!!!! It is such a simple thing for the Mayor and great PR …”

 Lori B. Tokar

“Save Jerry and put a smile back on his face…and his customers that have seen him in the same place for 24 years. Please.”

 Will Politan

“This man is part of a community and deserves justice.”

Benton Jeter

I live in Atlanta and saw the story on Jerry and I sign this petition to save his job that he served faithfully for 24 years. Let Jerry work…!!! 

Will Politan

“This man is aprt of a community and deserves justice.”

Barbara Hall

“Stop raping people he wants to work, let him.”

Vinnie Politan

“Have a heart!”

Gerald Robert Jr.

“Just give him the license!! Everyone needs a job and the local people need him!”

Dean Marchi

“With a chase bank and a kmart across the street and starbucks creeping up behind him…. jerry’s stand is the only thing that is keeping astor place a real neighborhood. save jerry’s news stand!!”

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Once upon a time…

Twenty-four years has gone and Jerry has been always here.

Jerry Delakas’s brother Aris worked in the Newsstand and this is how the first Newsstand was.

Jerry is in his second Newsstand , the one he paid $55,000 of his own funds to renew to abide by the law in 1993.

Jerry on September 11 2001.

Jerry today in his third Newsstand, the one that CEMUSA renewed in 2007.

Where he belongs to and we wish to be here forever.

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Jerry’s side in two points.

Now we need to look closer to the instant appeal and argument that Gil Santamarina prepared in order to support Jerry Delakas:

Point I: THE LOWER COURT ‘S DENIAL OF APPELLANT’S ARTICLE 78 PETITION MUST BE REVERSED.

A. The lower court erred in holding that “DCA’s decision to deny Appellant’s application for a license to operate the newsstand had a rational basis”. the lower court incorrectly held that “even if an applicant meets the requirements set forth in the statute, the Commissioner is not required to grant the application”. To the contrary, it would be “arbitrary and capricious” for the Commissioner to deny an application that met the statute.

Administrative agency decisions must have a rational basis. (See Goldstein 90 A.d. 2d at 749). In this case the three prongs of the statute serve as a guidance for developing a rational basis from which substantial evidence may be gathered. Substantial evidence is required for a decision of the administrative tribunal to be upheld.

Appellee’s action was arbitrary and capricious because, without explanation and in the face of a clear demonstration of factors meeting the requirements of RCNY 2-64 (a)(12), Appellant’s application was denied and that no reason was given in the Denial Letter, underscores the arbitrary nature of the denial. Since Appellee’s action was taken without regard to the facts it is deemed arbitrary. (See Halperin v. City of New rochelle 24 a.D. 3d 768, 770; 2nd Dep’t 2005) Failure to take into account the three prongs of 6 RCNY 2-64 (a)(12) is an abuse of discretion.

The lower court is mistaken in its conclusion that “it was rational for the DCA to determine the Appellant did not demonstrate that he had financially dependent relationship with either of the Ashleys that would entitle him to the license transfer under 6 RCNY 2-64 (a)(12). (R. at 12.) Significantly, the court read into the DCA’s decision, this conclusion is nowhere contained in the Denial Letter. (R. at 42.)

However in addition to being incorrect the court failed to address the other two prongs of 6 RCNY 2-64(a)(12).

Appellant operates the Newsstand for a living. His livelihood is dependent on the income he derives from it. (Appellant swore to this in his application and DCA has no factual basis for disputing this). Since the Ashleys permitted to him to earn whatever profit he made over $75 weekly payment they received from him, then (a) he was their de facto employee, and he was (b) financially dependent on them and had a pre-existing relationship with them and (c) this was his exclusive source of income.

This is all that 6 RCNY 2-64 (a)(12) (a)&(b) requires. Appellant meets these criteria.

Death or disability of licensee. …, DCA may accept an application for a license to operate such existing newsstand where:

A) the applicant is a dependent spouse, dependent domestic partner, dependent child or one-time employee of the former licensee, or bears another pre-existing, established relationship to such former licensee that included financial dependence on such licensee;

B) the applicant demonstrates to DCA that the operation of such newsstand will be his or her principal employment;

C) the applicant is a person to whom the grant of such license would be in the interest of fairness.

The lower court’s characterization of the Appellant’s operation of the Newsstand as a “fraudulent, under-the table arrangement with Ashleys” is a gross mischaracterization and was not identified in the Denial Letter as being a basis for Appellant’s application being denied.

Given Appellant’s open and notorious nature of operating the Newsstand, which included not only his presence at the newsstand 6 days a week, 12 hours a day for 24 years, but also various features in main stream magazines such as the New York Times, and New York Newsday, in addition to his appearing in the 2009 movie entitled “South“, it is anything but an “under-the table arrangement”.

DCA was or should have been on notice of his operation of the newsstand, and in any event, the lower court erred in holding that the “under-the table arrangement was a proper basis for DCA’s denial since the Denial Letter make no such reference.

For these reasons, the lower court erred, and its decision must be reversed.

B. The decision of the DCA must be set aside and/or remanded to the agency for review because it lacks any rational basis, is not grounded in substantial evidence, and is an error of law.

DCA acknowledges that under 6 RCNY 2-64 (a)(12), the DCA may accept an application for a license to operate an existing newsstand where: (a) the applicant is… one-time employee of the former licensee, or bears another pre-existing, established relationship to such former licensee that included financial dependence on such licensee; (b) the applicant demonstrates to DCA that the operation of such newsstand will be his or her principal employment; and (c) the applicant is a person to whom the grant of such license would be in the interests of fairness. (R. at 281.)

Supporting point (a)

  • Appellant’s twenty-four year relationship with the Ashleys, the licensees, through whom he earned a living wage can only be characterized as “an established pre-existing relationship to such former licensee that included financial dependence on such licensee.” (R. at 19.)
  • Katherine herself, by way of her will, described her relationship with Appellant as “warm, trusting, and loving.” (R. at 29.) Her intention to continue to provide for her beloved friend is evidenced by her will: “it is my wish that JERRY DELAKAS continue in his capacity as day to day operator of the Newsstand after my demise and, if possible, to succeed me as a franchisee” (R. at 29.)
Although such a conveyance has no legal affect, it is indicative of the established relationship between the Appellant and the licensee, illuminating the monetary support provided by the licensee and the Appellant’s financial dependence on such.
Supporting point (b)
  • As per the income tax filing by Appellant’s company of Cooper Square News Corp of 2009, the Newsstand generated $20,209.00 of income.(R. at 47.) As such, Appellant received approximately $389.00 a week of which he gave $75 to the Ashleys. (R. at 25.)
  • DCA quibbles with whether one who pays to operate a business is an “employee” or can be deemed to have a financial relationship with the owner of that business, in this case, the Ashleys. (R. at 67-68). But this is a distinction without a difference. (R. at 282.) In 2009 for example, Appellant made a profit of $389.00 a week and paid the Ashelys $75, then his salary, or income, from operating the Newsstand that week was $314; this is no different than if he just received a check from Ashleys for $314.
Supporting point (c)
  • Finally, as to the “interest of fairness” standard which forms the third prong of the analysis under 6 RCNY 2-64 (a)(12), Appellant meets this prong for three reasons:
1) He has openly and notoriously operated this Newsstand for almost a quarter of a century,
2) Today he is 62 years old and losing this job would render him unemployed, and at that age, unemployable, and
3) In reliance upon his long-standing arrangement and understanding that he would continue to operate the Newsstand indefinitely, in 1993, Appellant invested $ 55,000,00.00 of his own funds to rebuild the Newsstand. (R. at 25.)
  • Given the open and notorious nature in which Appellant has operated the Newsstand, set forth below in greater detail, it is simply unfair for DCA to deny Jerry Delakas’s request for a license to operate the existing Newsstand at a fragile age of 62. Given Appellant’s age, it would be a great hardship for him to find another form of employment or start a new career.
  • Lastly, Mr Jerry Delakas operates the Newsstand with great care and pride, evidenced by his investment into the Newsstand, which has become a staple of Astor Place as recognized by the NY Times in its “Time Capsule” issue of what NYC looked like 2000 for benefit of future generations. (R. at 286)
Point II: APPELLANT HAS OPERATED OPENLY AND NOTORIOUSLY AS A NEWSSTAND OPERATOR AND THEREFORE APPELLEE CANNOT ASSERT LACK OF KNOWLEDGE.
A. Appellee was on notice that Appellant operated the Newsstand and should be stopped from denying such knowledge and acceptance.
Form the past twenty-four years Appellant prominently displayed the consumer affairs license first bearing the name Stella Schwartz until 1994, then the name Katherine Ashley from 1994 to 2006, and since 2006, the name of Sheldon Ashley.
No person upon visiting the Newsstand from the late 1980s-2006, nearly twenty years, could possibly mistake Mr. Jerry Delakas for Ms. Stella Schwartz or Mrs. Katherine Ashley. Mr Jerry Delakas openly and notoriously operates the Newsstand, personal spending six days a week, twelve hours a day at the Newsstand. Therefore , the DCA was on constructive notice that Appellant was operating the Newsstand, which they licensed first to Stella Schwartz and then to Mrs. Katherine Ashley, and then to Mr. Sheldon Ashley, all the while that Mr. Delakas was openly working there alone. Mr. Jerry Delakas has continuously disclosed to anyone who would ask that this was “his” Newsstand. Since the early 1990s, Appellant held himself out to not just New York City, but the world, as being the owner and proprietor of the Newsstand. Jerry Delakas’s Newsstand has been featured in several popular news stories over the years. Appellant is regarded as a familiar neighborhood staple. He has been featured in publications and movies from 1994 through the present. For example, the New York Times Magazine featured an article entitled “New York Minute”, in its December 5, 1999 edition, where Jerry Delakas is described as standing “alone in his compact green newsstand” represents on the many sights, smells and sounds of New York City.  
An article in the New York Newsday from November 11, 1994 referred to Mr. Delakas as “the newsstand proprietor” of Astor Place.
The September 1999 feature of the International Publication for the Professional Photographer featured Jerry Delakas on its cover, and on the inside refers to him as the “Proprietor of the Astor Place Newsstand”. 
The Web site http://www.eastvillagepodcasts.com wrote about Appellant on September 6, 2008 in reference to the City of New York’s contract with CEMUSA to replace the city’s newsstand and the problems the new structure have created for stand operators: “Jerry,  newspaperman for the East Village of NYC, on the corner of Astor Place and Lafayette, can attest to these failings.” In a New York Magazine article entitled “Everything’s a Dollar!”, published December 11, 2005, Jerry Delakas is referred to as “the Astor Place newsstand vendor.” Jerry Delakas was even featured in the movie entitled “South”, where he is listed on the Web site IMDB.com as “Man at Newsstand”. Appellant field income taxes as the Presidetn of “Cooper Square News Corp.” for the Newsstand. He ensured that taxes were filed for the corporation. DCA was also on notice as all corporations are registered with the Department of State and available for public viewing through their website. In 2007, Appellant’s newsstand was renovated by CEMUSA, an advertising company contracted by the City of New York to replace many newsstand throughout the City. The City, through its agent CEMUSA, had knowledge that Jerry Delakas was operating the Newsstand.
Thus, Appellee should be stopped from denying Appellant’s license renewal application because in 2007, when it caused the Newsstand to be renovated by one of its agents, it accepted Appellant Jerry Delakas as everyday operator of the Newsstand. 
Posted in Jerry Delakas | 3 Comments

The other side of the story.

Last month I met Jerry Delakas’s lawyer, Gil Santamarina and I talked to him about my project and asked him to clarify some points of this story that seemed dark to me.

He has been cooperative and kind, explaining me everything. He gave me the previous record on appeal where I could unravel some aspects, and the copy of his brief for petitioner-appellant in support of his appeal from following Decision and Order of Honorable Cynthia S. Kern that will be discussed in few months in New York Supreme Court.

Now, everybody can have an idea about the justification of the previous Decision and Order of March 21, 2011, in this post

About last appeal… one side of the story.

I am here to show through this documentation what has been omitted and not totally considered.

The side of Jerry story not fully took into consideration and fully respected.

I want to thank Gil Santamarina to let me have all further information that now I have the chance to share with all of you.

In the DCA Denial Letter, Determination dated January 6, 2011, Appellant’s application for a renewal of a license to operate the existing newsstand located at the northwest corner of Astor Place and Lafayette Street was refused.

This happened although the Appellant has established what they asked:

A) that he is a “one-time employee of the former licensee” or in the alternative, “he has demonstrated that he had a pre-existing, established relationship to the former licensee that included financial dependence on the licensee“. (R. at 19)

B) The operation of the Newsstand has been Appellant’s principal employment for almost a quarter of a century.

C) there is also an interest of fairness that should be considered and that should grant the license to Jerry Delakas.

The lower Court found “rational basis” in the denial although there is not.

Why not?

1) Appellant Jerry Delakas has operated the Newsstand continuously and without interruption 6 days a week 12 hours a day since 1987, approximately 24 years.

2) The operation of the Newsstand is Jerry’s primary employment.

3) He is dependent on the income generated from the Newsstand for his livelihood. Jerry takes also care about Aris, his only brother who is affected by mental problems.

 4) The license to operate the Newsstand was originally issued in the name of Stella Schwartz, and then Katherine Ashley, now deceased. Jerry and licensee holders agreed that he would operate the Newsstand in exchange for a weekly fee of $75,00, which he has duly paid since 1987, with the understanding that he would remain the operator of the Newsstand indefinitely and that upon her death, the license would pass him.

Jerry has been paying his taxes all these years and never tried to be disrespectful of his community or of the U.S.A. Government.

5) In reliance upon this long-standing arrangement, in 1993, Jerry rebuilt the Newsstand out of his own funds, to fit the new standard the law requested, at the cost of approximately $55,000.00 with the understanding that he would continue to operate the Newsstand indefinitely.

6) When Mrs. Ashley died in 2006, her will bequeathed to Jerry her interest in the Newsstand so that Jerry could continue in his capacity as operator of the Newsstand after her death and succeed her as franchisee.

Reporting Article Seven of the Will:

” For many years, the day-to-day operation of the Newsstand has been conducted diligently by JERRY DELAKAS (…) with whom I have developed a warm, trusting, and loving relationship. It is my wish that JERRY DELAKAS continue in his capacity as day-to-day operator of the Newsstand after my demise and, if possible, to succeed me as franchisee.”

But they say there is not a sufficient proof of a pre-existing, established relationship to the former licensee that included financial dependence on the licensee.

7) Jerry received notice of this bequest by way of a probate notice on or about August 6, 2006, which informed him that the notice did “not require any action on his part”.

So Jerry didn’t do anything of course.

8) For reasons unknown to Jerry, or anyone, on December 11, 2008, the license to operate the Newsstand was reissued by DCA in the name of Sheldon Ashley, Mrs. Katherine Ashley’s husband.

9) So as was the arrangement with Katherine Ashley, Jerry continued to pay Sheldon Ashley $75,00 a week in order to operate the Newsstand.

10) Upon information and belief, based upon correspondence with Ms. Ashley’s attorney, Mr. Ashley took no action with regard to transferring the Newsstand franchise to Jerry, although this was clearly Katherine’s intent as set forth in her will.

Obviously Jerry never asked Mr. Sheldon Ashley to do what was written in his wife’s will. It was supposed to be Sheldon’s responsibility and care.

So simply Jerry’s arrangement with Mrs. and Mr Ashley remained in effect and Jerry continued to operate the Newsstand and pay the $75,00 a week.

Just some steps back to clarify the procedural history and decisions.

  • On or about September 20, 2010:  the Estate applied for a renewal of the license, duly filing the Renewal License Application and paying the fee of $ 1,076.00, the intention being to permit Jerry to be able to continue to operate under said license as he has since 1987. (R. at 36).
  • On or about September 24, 2010, the Estate received notice from Appellee by mail, stating that the Estate could not be granted a license, because under section 20-229 of the New York City Administrative Code, the DCA may only issue a license to persons operating such franchises as their principal employment and an “estate of a deceased cannot maintain employment.”

The letter, lengthy in comparison to that received by Jerry, advised that “rules promulgated by Commissioner of Consumer Affairs do authorize the Commissioner, at his discretion, to transfer a newsstand license to a dependent in the event of a death of licensee.” (R. at 40.)

  • On or about December 6, 2010, Jerry filed a Renewal License Application to operate the existing Newsstand and to have title to the license issued in his name under 6 RCNY 2-64 (a)(12), which states:

Death or disability of licensee. At the discretion of the Commissioner or his or her designee, upon the death or permanent disability of the person who was licensed to operate a newsstand at a location, DCA may accept an application for a license to operate such existing newsstand where:

A) The applicant is a dependent spouse, dependent domestic partner, dependent child or one-time employee of the former licensee, or bears another pre-existing, established relationship to such former licensee that included financial dependence on such license;

B) the applicant demonstrates to DCA that the operation of such newsstand will be his or her principal employment; and

C) the applicant is a person to whom the grant of such license would be in the interest of fairness. The Commissioner may grant a license to such an applicant who meets the burden of demonstrating to operate such an existing newsstand where the conditions in this paragraph (12) have been met, the applicable license and application fees have been paid, the New York certification of authority to collect New York sales tax has been provided, and the newsstand, and the newsstand meets all other applicable requirements of this Part including, but not limited to, a qualifying inspection by DOT.

  • January 6, 2011 Jerry’ request was denied from Juan Orozco, Jr.; Director of Licensing for Appellee.

” (…) Your request for a license to operate the existing newsstand at the northwest corner of Lafayette Street and Astor Place last licensed to Sheldon Ashley under license No. 1243058 is denied. You have not demonstrated that the Department should exercise discretion to issue a license to (Appellant) under 2-64 (a)(12) of Title 6 of the Rules of the City of New York, the applicable provision.”

No explanation was offered in denying Jerry’s application for the license, despite Jerry’ clear demonstration as required under 6 RCNY 2-64(a)(12).

As I showed before:

A) (…) that he is a one-time employee of the former licensee, or in the alternative has a pre-existing, established relationship, which included financial dependence on such license,

B) that the operation of the Newsstand constituted Appellant’s principal employment, and

C) that issuance of the license, given Appellant’s investments of resources, time and energy over almost a quarter of a century, is “in interest of fairness.”

After the denial letter Jerry brought the Article 78 petition of CPLR to the Supreme Court, County of New York.

  • December 6, 2010 Jerry provided a copy of his application to the Lower Court in support of the Article 78 petition.

The Lower Court denied Jerry’s petition.

  •  On or about August 13, 2011, Jerry appealed the Lower Court’s decision to the Appellate Division of the Supreme Court of the State of New York, New York County.
Which is the basis of action?
The DCA improperly denied Appellant’s Renewal License Application and would have to permit him to continue to operate the existing Newsstand a she had for the previous 25 years and to have title to the license issued in his name under RCNY 2-64 (a)(12).
Now the point is that:
Courts have the power to overturn the decision of an administrative tribunal when there is “no rational basis for the exercise of discretion or the action complained of is arbitrary and capricious”. (See Pee v. Bd. of Educ. of Union Free School Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Wetchester County, 1974).

Courts have power to determine whether an administrative agency acted arbitrarily and capriciously by testing whether a particular action is without foundation in fact.

“An action is arbitrary if without sound basis in reason and is generally taken without regards to the facts.” And,“Rational basis exists where the administrative determination is supported by substantial evidence”.

It’s defined “substantial evidence, such relevant proof as a reasonable mind may accept as adequate to support a conclusion or ultimate fact, it does not rise from bare surmise, conjecture, speculation or rumor” (Id. Goldstein v. Lewis).

There is not substantial evidence to refuse Jerry’s request according to the evidences he had to provide to the DCA.


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Something to take into consideration…

First of all, thanks to everyone who wrote, who tried to give Jerry what he deserves.

Someone of you is not alive anymore, but thanks wherever you are.

I want to show some evidences that Jerry has been trying to work honestly and to be legally considered one of the licensee of the Newsstand in Astor Place where he has been working 7 days per week almost 12 hours for these past 24 years.

The Newsstand license belongs to him. Whatever could have been wrong in the previous arrangements.

This is the letter that in 1994  Katherine B. Ashley, the sister of Stella Schwartz (Stella was the wife of Michael Arthur Schwartz, the first person who owned the license of the Newsstand, ), sent as a request to include the name of Jerry Delakas in the license.

 

But they say there is not a valid evidence of a previous relationship between them.

This is the letter that always in 1994 Eleonor Garz sent to support the transfer of the license of the Newsstand to Jerry Delakas.

 

And still he can’t get it.

This is the letter that Loretta Brennan Glucksman, chairman of The American Ireland Fund, sent to Hon. Jonathan Mintz, on August 2, 2011.

We hope this will take into consideration for the next appeal on October, 2011.

This is the letter that Bruce Cunningham, Executive Director of Queens Interagency Council on Aging, sent to Mayor Michael Bloomberg on April 18, 2011.

We trust and believe that he can still do something and act on the side of fairness and not let this words ending like this.

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About last appeal… one-side story.

Jerry Delakas and his lawyer Gil Santamarina decided to petition against the decision that New York City Department of Consumer Affairs (DCA) made on January 6, 2011 concerning the request by Jerry Delakas for a license to operate the Newsstand in Astor Place.

When Juan L. Orozco Jr., Director of Licensing for DCA, denied the application in a letter, Jerry and Gil started the petition pursuant to Article 78 of the Civil Practice Law and Rules (CPLR).

So the trial started against Jonathan Mintz, in his capacity as Commisioner of New York City Department of Consumer Affairs.

This is the decision made on the last appeal on March 21, 2011.

In the Matter of the Application of Jerry Delakas, Petitoner v. Jonathan Mintz, in his capacity as Commissioner of the New York City Department of Consumer Affair, Respondent, 100739/11

Justice Cynthia S. Kern

Decision/Order

*1  Petitioner Jerry Delakas brought this petition pursuant to Article 78 of the Civil Practice Law and Rules (CPLR) seeking to vacate and annul a determination made by the New York City Department of Consumer Affairs (the DCA), dated January 6, 2011 (the Determination). In the Determination, the DCA denied petitioner’s application for a license to operate an existing newstand located at the northwest corner of Astor Place and Lafayette Street, New York, New York. For the reasons set forth below, the petition is denied.

*2 The relevant facts are as follows. Petitioner has operated a newsstand located at the northwest corner of Astor Place and Lafayette Street, New York, New York (the Newsstand) continuously and without interruption since 1987, approximately twenty-four years. The license to operate the Newsstand was originally issued in the name of Katherine Ashley, who is now deceased. According to petitioner, Ms. Ashley and petitioner agreed that petitioner would operate the Newsstand on a daily basis in exchange for a weekly fee of $75,00, which the petitioner has paid continuously since 1987. Ms Ashley would, however, remain the only person actually licensed to operate said Newsstand.

However, under Title 20 of the New York City Administrative Code, an individual cannot operate a newsstand unless he or she is licensed to do so. Additionally, under 6 RCNY 1-01.1:

a) No applicant for a license or a renewal thereof shall fail to provide complete and truthful responses to all the information requested on an application for such license or renewal thereof and any documents related thereto.

b) No applicant for a license or renewal thereof shall conceal any information, make a false statement or falsify or allow to be falsified any certificate, form, signed statement, application or report to be filed with an application for a license that is to be issued by the department or for a renewal thereof.

Furthermore, Admin. code 10-154 provides the following:

Any person who shall knowingly make a false statement or who shall knowingly falsify or allow to be falsified any certificate, form, signed statement, application or report required under the provisions of this code or any rule or regulation of any agency promulgated thereunder, shall be guilty of an offense and upon conviction thereof shall be punishable by a fine of not more than five hundred dollars or imprisonment of a term of not more than sixty days or both.

*3 Thus, it appears that the arrangement petitioner maintained with Ms. Ashley was illegal under the laws of the City of New York.

Ms. Ashley died in 2006 and bequeathed to petitioner her interest in the Newsstand so that petitioner would continue to operate the Newsstand on a daily basis and succeed Ms. Ashley as franchisee of the Newsstand. Petitioner received notice of the bequest by way of a probate notice on or about August 6, 2006, which informed petitioner that the notice did “not require any action on (petitioner’s) part.” The license to operate the Newsstand, however, was instead transferred by DCA to Ms. Ashley’s surviving spouse, Sheldon Ashley, as sole licensee of the Newsstand. On December 11, 2008, a license to operate the Newsstand was reissued by DCA in the name of Mr. Ashley. As per the illegal arrangement with Ms. Ashley, petitioner continued to pay Mr. Ashley $75,00 a week in order to operate the Newsstand.

During his lifetime, however, Mr Ashley did not transfer the license to operate the Newsstand to petitioner, and upon Mr. Ashley’s death, the interest in the Newsstand franchise passed to the Estate of Sheldon Ashley (the Estate). The Estate has authorized petitioner to continue to operate the Newsstand. On September 20, 2010, the Estate timely applied for a renewal license. On or about September 24, 2010, the Estate received notice from the DCA by mail stating that the Estate could not be granted a license because under Admin. Code 20-229 the DCA may only issued a license to persons operating such franchises as their principal employment and “an estate of a deceased cannot maintain employment.”

On December 6, 2010, petitioner filed a Renewal License Application to operate the Newsstand and to have title to the license issued in his name, as per 6 RCNY 2-64(a)(12), which states:

*4 Death or disability of licensee. At the discretion of the Commissioner or his or her designee, upon the death or permanent disability of the person who was licensed to operate a newsstand at a location, DCA may accept an application for a license to operate such existing newsstand where:

A) The applicant is a dependent spouse, dependent domestic partner, dependent child or one-time employee of the former licensee, or bears another pre-existing relationship to such former licensee that included financial dependence on such licensee;

B) The applicant demonstrates to DCA that the operation of such newsstand will be his or her principal employment; and

C) The applicant is a person to whom the grant of such license would be in the interest of fairness. The Commissioner may grant a license to such an applicant who meets the burden of demonstrating eligibility to operate such an existing newsstand where the conditions in this paragraph (12) have been met, the applicable license and the application fees have been paid, the New York certification of authority to collect New York sales tax has been provided, and the newsstand meets all other applicable requirements of this Part including, but not limited to, a qualifying inspection by DOT.

In his application, petitioner attempted to demonstrate his eligibility for the license by showing (A) a “pre-existing, established relationship” which included financial dependence on said relationship, (B) that the operation of the Newsstand constitutes petitioner’s principal employment, and (C) that issuance of the license, given petitioner’s investment of time, energy and resources over the last 24 years is “in interests of fairness.”

Petitioner’s application was denied on January 6, 2011 in a letter (the Denial letter) from Juan L. Orozco Jr., Director of Licensing for DCA, for failure to demonstrate that “the DCA should exercise discretion to issue a license to (petitioner) under 2-64 (a)(12). ” The denial letter failed to provide an explanation as to why petitioner’s application was denied other than that petitioner failed to sufficiently demonstrate that the DCA should exercise its discretion.

 *5 Petitioner now moves pursuant to Article 78 of the CPLR for an order vacating and annulling the DCA’s denial of his application for a license to operate the Newsstand.

On review of an Article 78 petition, “the law is well settled that the courts may not overturn the decision of an administrative agency which has a rational basis and was not arbitrary and capricious.” Goldstein v. Lewis, 90 A.D. 2d 748, 749 (1st Dep’t 1982). “In applying the arbitrary and capricious standard, a court inquires whether the determination under review had a rational basis.” Halperin v. City of New Rochelle, 24 A.D. 3d 768, 770(2d Dep’t 2005); see Pell v. Board. of Educ. of Union Free School Dist. No. 1 of Towns of Scarsdale & Mamaroneck, Westchester County, 34 N.Y. 2d, 222, 231 (1974) (“rationality is what is reviewed under both the substantial evidence rule and the arbitrary and capricious standard”.)

“The arbitrary or capricious test chiefly relates to whether a particular action should have been taken or is justified… and whether the administrative action is without foundation in fact. Arbitrary action is without sound basis in reason and is generally taken without regard to facts .” Pell, 34 N.Y. 2d at 231 (internal citations omitted).

In the instant action, the court finds that the DCA’s decision to deny petitioner’s application for  a license to operate the Newsstand  had a rational basis. As an initial matter, under 6 RCNY 2-64 (a)(12), it is in the Commissioner’s discretion whether to grant an application to operate a newsstand. Even if an applicant meets the requirements set forth in the statute, the Commissioner is not required to grant the application.

Second, the respondent had a rational basis for denying the application based on the position that petitioner engaged in a fraudulent, under-the-table arrangement with the Ashleys whereby he paid them $75,00 a week in exchange for the opportunity to operate the Newsstand. As more fully explained above, although the Ashleys held themselves out as the owners and operators of the Newsstand on paper at the

*6 DCA, the Ashleys illegally rented their City-issued license to petitioner. thus, the DCA was rational in not considering petitioner’s reliance on this fraudulent arrangement.

Finally, even if the DCA were overlook the fraudulent arrangement between the Ashleys and petitioner , the record clearly supports the finding that petitioner failed to meet requirements set forth in 6 RCNY 2-64(a)(12) for the transfer of the Newsstand’s license upon the death of Mr. Ashley. It was rational for the DCA to determine that petitioner did not demonstrate that he had a financially dependent relationship with either of the Ashleys that would entitle him to the license transfer under 6 RCNY 2-64(a)(12). While petitioner argues that he became financially dependent on the income from the Newsstand, that argument is without merit. Petitioner was financially dependent on the license itself, and not on the licensee, as required by the statute.

Because the record clearly supports the DCA’s decision, the court finds that there is a rational basis for its determination. It is therefore adjudged that the petition is denied and the proceeding dismissed.

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