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Thursday, March 26, 2009

The custodian of the records has the burden of proving that information it withheld in responding to a FOIL request is within a FOIL exemption

Matter of U.S. Claims Servs. Inc. v New York State Dept. of Audit & Control, 2009 NY Slip Op 29071, Decided on February 20, 2009, Supreme Court, Albany County, Platkin, J.

The U.S. Claims Services case concerned a FOIL demand for certain information held by the State Comptroller concerning the value of fund held by the State pursuant to the Abandoned Property Law [APL].

The APL requires banks, insurance companies, utilities, and other businesses to turn dormant savings accounts, unclaimed insurance and stock dividends, and other inactive holdings over to the State. If there has been no activity in the account for a set period of time, usually between two and five years, the money or property is considered unclaimed or abandoned.

Not only are funds owned by individuals turned over to the Comptroller – in some instances the monies are the property of governmental and private sector organizations. NYPPL reported that Albany City School; BOCES, Nassau County; City of New York; Erie County; State of New York; SUNY – Binghamton; SUNY Buffalo and Walmart Stores were among such institutions in an report published earlier. [The item is at:
http://publicpersonnellaw.blogspot.com/2008/11/unclaimed-funds-under-abandoned.html

U.S. Claims, an asset finder engaged in the business of assisting individuals and institutions in locating and recovering abandoned property, contacted respondent Office of the State Comptroller ("OSC"), requesting "information on [abandoned property] claims that fall within a [specified] range of dollar values, sorted alphabetically … [ranging in value from $250 up to $500]."

Although the Comptroller is required by law to publish semiannually a statement of abandoned property held by the State reporting the names and addresses of persons with an abandoned property value in an amount of at least twenty dollars, Eric Duvall, the Director of Services for the Office of Unclaimed Funds, denied U.S, Claims access to the records it had requested.

Mr. Duvall wrote U.S. Claims indicating … “under Section 1401 of the New York State Abandoned Property Law (APL) we cannot reveal dollar amounts for unclaimed accounts, unless the claimant has provided proof of entitlement or a satisfactory interest in the funds.” Noting that Section 1402 of the Abandoned Property Law has a $20, Mr. Duvall said the Comptroller “maintain a $50 threshold for our Internet website” but … “in keeping with the spirit of the law, we do not provide segments of the account owner list based on higher dollar amounts … to maintain the general confidentiality of the funds."

U.S. Claims appealed, claiming that it was entitled to the information pursuant to FOIL. Justice Richard M. Platkin dismissed its petition, noting that all records of a government agency are presumptively available to the public, unless the requested records fall within one of the enumerated exemptions set forth in the FOIL statute and “[t]he burden of demonstrating the applicability of a FOIL exemption rests squarely with the government agency," citing Daily Gazette v Schenectady, 93 NY2d 145.*

At to whether the FOIL exemption from disclosure for the abandoned property records are "specifically exempted from disclosure by state or federal statute," Justice Platkin said that "[s]o long as there is a clear legislative intent to establish and preserve confidentiality of records, a State statute need not expressly state that it is intended to establish a FOIL exemption."

Accordingly, the issue to be decided, said Justice Plankin, is whether the State Comptroller's construction of the APL is rational and reasonable.

The court’s conclusion: “The State Comptroller's construction of [the APL] as prohibiting the disclosure of abandoned property claims that fall within a targeted range of amounts [requested by U.S. Claims] is a reasonable method of giving effect to the Legislature's expressed intent of withholding from third parties information concerning the value of abandoned property claims."

* The release of some public records is limited by statute [see, for example, Education Law, §1127 - Confidentiality of records; §33.13, Mental Hygiene Law - Clinical records; confidentiality]. Otherwise, an individual is not required to submit a FOIL request as a condition precedent to obtaining public records where access is not barred by statute. A FOIL request is required only in the event the custodian of the public record[s] sought declines to “voluntarily” provide the information or record requested. In such cases the individual or organization is required to file a FOIL request to obtain the information. It should also be noted that there is no bar to providing information pursuant to a FOIL request, or otherwise, that falls within one or more of the exceptions that the custodian could rely upon in denying a FOIL request, in whole or in part, for the information or records demanded.

The full text of the decision is posted on the Internet at:
http://www.courts.state.ny.us/reporter/3dseries/2009/2009_29071.htm

Reprinted with permission from New York Public Personnel Law Blog

Mitchell H. Rubinstein

http://lawprofessors.typepad.com/adjunctprofs/2009/03/the-custodian-o.html

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