Application of a CHILD WITH A DISABILITY, by his parents, for review of a determination of a hearing officer relating to the provision of educational services by New York City Department of Education
Skyer, Castro, Foley & Gersten, attorney for petitioners, Diana Gersten, Esq., of counsel
Hon. Michael A. Cardozo, Corporation Counsel, attorney for respondent, Andrew Rauchberg, of counsel
Petitioners appeal from the decision of an impartial hearing officer which denied their request to be reimbursed for privately funded services provided to their son at the East Side Community High School (ESCHS) for the 2002-03 school year.1 The appeal must be dismissed.
At the time of the impartial hearing, the student was 20 years old. The student's eligibility for special education programs and services as a student with a speech impairment is not in dispute (see Parent Ex. B at p. 2; 8 NYCRR 200.1[zz]).
Petitioners report that the student has experienced severe speech and language difficulties since early childhood, presenting with auditory processing, semantic imprinting and lexical retrieval challenges (Parent Ex. B at p. 1). For the 2002-03 school year, respondent's Committee on Special Education (CSE) recommended general education with nine periods of special education teacher support services, a health services paraprofessional, speech and language therapy and occupational therapy for the student (id.).
On or about September 9, 2002, petitioners requested an impartial hearing, and contended that the student's placement was inappropriate because it lacked the necessary support services. They sought "a full-time facilitation, a Communication Education Technology Associate and the intensive services of a Communication Education Technology Specialist" at ESCHS for the student for the 2002-03 school year. Petitioners withdrew their hearing request in March 2003 before an impartial hearing was held on the merits (Tr. pp. 13-15). By due process complaint notice dated February 1, 2006, petitioners sought reimbursement for the privately funded services provided to the student at ESCHS during the 2002-03 school year (Parent Ex. B at p. 1).
On or about June 5, 2006, respondent moved to dismiss petitioners' reimbursement claim, arguing that petitioners' claim was time-barred under the Individuals with Disabilities Education Act (IDEA), as amended (20 U.S.C. §§ 1400-1482;2 Dist. Ex. 1 at p. 2). Respondent further asserted that petitioners' claim would have been untimely even prior to the amendment of the IDEA (Dist. Ex. 1 at p. 2). In response to the motion to dismiss, petitioners argued that legal action was commenced in a timely manner and that they withdrew their claim after respondent was recommending settlement of the case. Petitioners asserted that respondent "repeatedly promised settlement" and therefore respondent should be equitably estopped from pleading that the "common law statute of limitations of one year" had elapsed (Parent Ex. A at pp. 3-6). Petitioners also contended that "but for the misrepresentation regarding settlement, the parents would have not withdrawn their timely request" and that the IDEA, as amended, provides that the statute of limitations is inapplicable where a parent is prevented from requesting a hearing due to the specific misrepresentations by a local educational agency (Parent Ex. A at pp. 3-4; see 20 U.S.C. § 1415[f][D]). Petitioners also argued that respondent was precluded from asserting the defense of laches because respondent was not prejudiced by the delay and respondent's misrepresentation regarding settlement justified the delay (Parent Ex. A at pp. 4-5).
An impartial hearing was held on July 10 and August 3, 2006. The impartial hearing officer first took evidence on respondent's motion to dismiss before deciding whether to proceed to the substantive aspects of petitioners' claim for reimbursement (Tr. pp. 25, 28). Respondent called a witness employed in its Central Liaison Office (CLO), who testified that his office was created for the purpose of tracking impartial hearing and settlement information in tuition reimbursement cases in a computerized database (Tr. p. 36; Dist. Exs. 2, 3). The CLO employee explained that his office compiles recommendations for settlement and additional case information and then forwards the information to respondent's Office of Legal Services (OLS) (Tr. pp. 38-39). He asserted that submitting a recommendation for settlement to the CLO does not mean that a stipulation of settlement will ultimately be issued by OLS (Tr. p. 66).
The attorney who conducted negotiations on behalf of petitioners (negotiating attorney) testified at the impartial hearing that the parties had not agreed upon a dollar amount with regard to petitioners' claim for reimbursement for the 2002-03 school year (Tr. pp. 99-100). The negotiating attorney submitted a letter to respondent dated March 7, 2005 asserting that if the 2002-03 reimbursement claim was not resolved within two weeks, then petitioners would pursue their claim through litigation (Dist. Ex. H). According to the negotiating attorney, one of respondent's attorneys then requested that petitioners refrain from putting the case "back on the calendar" (Tr. pp. 103, 110, 134-35). The negotiating attorney also testified that the CLO employee did not have authority to negotiate cases and that he told her to put petitioners' claim from the 2002-03 school year "back on the calendar" (Tr. pp. 109-10). The negotiating attorney further testified that certain types of cases typically take years to settle, and she opined that there is no statute of limitations with respect to settlement negotiations (Tr. pp. 113-14). According to the negotiating attorney, when respondent's OLS represents that a case is settled, the OLS requests that the case be withdrawn and a petitioners' attorney does so "without prejudice" (Tr. pp. 115-16). With regard to petitioners' case, the negotiating attorney asserted that respondent's attorney confirmed orally that the case had been recommended for settlement and that "everyone was entering into settlement negotiations" (Tr. p. 119). She further asserted her belief that if a case is timely filed and subsequently "withdrawn without prejudice," then there is no timeframe within which the case must be resolved (Tr. pp. 140-41).
By decision dated September 20, 2006, the impartial hearing officer determined that petitioners' claim arose when the one-year statute of limitations was in effect (IHO Decision, p. 9). However, she applied the two-year statute of limitations under the IDEA, as amended, because respondent raised a two-year statute of limitations defense and "in order to be generous to [petitioners]" (id.). Finding that the action forming the basis of petitioners' complaint began the first day of the 2002-03 school year and ended the last day of the school year, the impartial hearing officer determined that petitioners should have filed a complaint within two years after the last day of the 2002-03 school year, or on or about June 30, 2005 (id. at p. 10). The impartial hearing officer found that petitioners' claim was untimely because they did not file the claim within the two-year limitations period and they did not establish that respondent prevented petitioners from filing a timely request by misrepresenting that the matter had been resolved (id.). Lastly, the impartial hearing officer found that petitioners failed to sustain their burden of proving that respondent was not prejudiced by the delay in litigating the claim and refuting that laches barred their claim (id. at p. 11).
On appeal, petitioners argue that their February 1, 2006 due process complaint notice was a reinstatement of their initial hearing request filed in September 2002 because the parties failed to finalize a stipulation of settlement. Petitioners allege that they did not intend to waive their right to an impartial hearing when they withdrew their case in March 2003. Petitioners also annex to their petition an affirmation by their former counsel (Pet. Ex. A).3 Petitioners argue that their claim is not untimely because at no time after withdrawing their claim in 2003 did they inform respondent's CSE that they accepted the CSE's recommendation or that they did not wish to pursue an impartial hearing.
Petitioners also claim that the impartial hearing officer erred by holding that petitioners were not prevented by respondent from filing their request for an impartial hearing. Petitioners assert that they relied upon respondent's promises to settle their 2002-03 reimbursement claim and that consequently, the statute of limitations should be tolled. Contending that equitable estoppel should bar respondent from pleading a statute of limitations defense, petitioners assert that respondent used the settlement process to delay petitioners from reopening their case. Petitioners also allege that the doctrine of laches should not bar their claim because respondent did not change its position with respect to the 2002-03 individualized education program (IEP) after petitioners filed their 2002 hearing request and it was not precluded from responding to petitioners' concerns. Petitioners assert that by engaging in ongoing settlement negotiations, respondent shared responsibility for the delay, which precludes application of the doctrine of laches in this case.
Respondent admits that petitioners withdrew their 2002 hearing request. Respondent argues there was no evidence that an offer of settlement was tendered or that a stipulation of settlement was signed. Respondent also argues on appeal that the former one-year statute of limitations was in effect when petitioners' claim accrued and that petitioners' claim had likely accrued sometime before they filed their original hearing request on September 9, 2002, and that the claim was time-barred no later than October 7, 2003, one year after the annual review of the student's IEP that was conducted for the 2002-03 school year. Asserting that the claim is also untimely under the new two-year statute of limitations, respondent further contends that none of the statutory exceptions to the two-year limitations period apply because respondent did not withhold any required information from petitioners and there is no evidence that respondent either misrepresented that it had resolved the dispute or prevented petitioners from asserting their rights. Finally, respondent contends that petitioners' 2006 due process complaint notice was brought after the one-year statute of limitations had elapsed, and that petitioners failed to overcome the strong presumption that their claim was barred by the doctrine of laches.
I find that petitioners' due process complaint notice is untimely for the reasons stated herein. The parties agree that petitioners' claim for tuition reimbursement arose in 2002, and I find that the impartial hearing officer correctly determined that a one-year limitations period governed when the events underlying the dispute occurred (IHO Decision, p. 9). Prior to the 2004 IDEA amendments (20 U.S.C. §§ 1400-1482), the IDEA did not prescribe a time period for filing a request for an administrative due process hearing and New York applied a one-year limitations period (M.D. v. Southington Bd. of Educ., 334 F.3d 217, 221-22 [2d Cir. 2003]; Application of the Bd. of Educ., Appeal No. 02-119). A claim accrues when a petitioner knew or should have known of the injury involved, i.e., the inappropriate education (Southington, 334 F.3d at 221; Application of the New York City Dept. of Educ., Appeal No. 06-110; Application of a Child with a Disability, Appeal No. 06-083). IDEA 2004 requires that, unless a state establishes a different limitations period under state law, a party must request a due process hearing within two years of when the party knew or should have known of the alleged violation (20 U.S.C. § 1415[f][C]; see also 20 U.S.C. § 1415[b][B]; N.Y. Educ. Law § 4404[a]). Furthermore, IDEA 2004 contains statutory exceptions to the limitations period, one of which applies when the local educational agency specifically misrepresents that it has resolved the issue forming the basis of the complaint (20 U.S.C. § 1415[f][D]).4
However, I disagree with the impartial hearing officer's decision to apply the newly enacted two-year statute of limitations in order to be generous to petitioners (see IHO Decision, p. 9). Legal authority requires the application of the one-year limitations period. Both the Supreme Court of the United States and the Second Circuit Court of Appeals have provided guidance indicating that, absent clear congressional intent or unambiguous language in the statute, a newly enacted statute of limitations should not be applied retroactively to revive previously time-barred claims (Hughes Aircraft Co. v. U.S., ex rel. Schumer, 520 U.S. 939, 950  [citing Chenault v. U.S. Postal Service, 37 F.3d 535, 537, 539 [9th Cir. 1994]]; Landgraf v. USI Film Products, 511 U.S. 244, 280 ; In re Enterprise Mortgage Acceptance Co., 391 F.3d 401 [2d Cir. 2005] [the limitations period in the Sarbanes-Oxley Act of 2002 did not have the effect of reviving stale claims]; see also Application of a Child with a Disability, Appeal No. 06-026; Application of the New York City Dept. of Educ., Appeal No. 06-016). IDEA 2004 does not contain clear congressional intent or unambiguous language indicating that the new limitations period should apply retroactively, and accordingly I decline to apply its two-year limitations period or its attendant exceptions (see Application of the New York City Dept. of Educ., Appeal No. 06-110; Application of a Child with a Disability, Appeal No. 06-083).
Here, there is no dispute that petitioners filed their hearing request for the 2002-03 school year on September 9, 2002 (Parent Ex. C), and that petitioners now seek to pursue the claim more than three years later (Parent Ex. B; Tr. pp. 118-20). Although petitioners' claim may have been timely when they first asserted it in 2002, the parties agree that it was not resolved on the merits (Tr. p. 15). Petitioners did not refile their claim within the one-year period. Applying the one-year limitations period, I find that respondent's February 1, 2006 due process complaint notice was filed long after the one-year limitations period had expired (Application of the New York City Dept. of Educ., Appeal No. 06-110; Application of a Child with a Disability, Appeal No. 06-083; Application of the Bd. of Educ., Appeal No. 02-119).
The inquiry does not end here because the parties differ about the effect of petitioners' withdrawal of their claim. I agree with the impartial hearing officer that the claim was filed in 2002, that it was voluntarily discontinued by petitioners in 2003 prior to a determination on the merits, and that therefore the statute of limitations continued to run as if petitioners' 2002 hearing request had never been filed because it had been withdrawn (see IHO Decision, pp. 9-10; A.B. Dick Co. v. Marr, 197 F.2d 498, 502 [2d Cir. 1952], cert. denied, 344 U.S. 878  ["voluntary dismissal of a suit leaves the situation so far as procedures therein are concerned the same as though the suit had never been brought. . . , thus vitiating and annulling all prior proceedings and orders in the case, and terminating jurisdiction over it for the reason that the case has become moot"]; Long v. Card, 882 F. Supp. 1285, 1288-89 [E.D.N.Y. 1995] [finding a claim time-barred after plaintiff's voluntary discontinuance]; see also Hollenberg v. AT&T Corp., 2001 WL 1518271 at *1-2 [S.D.N.Y. 2001]).
Turning to petitioners' argument that the doctrine of equitable estoppel should be applied to preclude respondent from pleading the statute of limitations as a defense, I find that equitable estoppel does not apply in this case. Ongoing negotiations or a likelihood of settlement does not, by itself, prevent a statute of limitations from running or provide a basis for applying equitable estoppel (Tomas v. Gillespie, 385 F. Supp. 2d 240, 248 [S.D.N.Y. 2005] [mere existence of ongoing settlement negotiations is insufficient to estop a party from asserting the statute of limitations as a defense]; Stark v. City of New York, 31 A.D.3d 530, 531 [2d Dep't 2006] [settlement negotiations, allusions to future negotiations, or oral promises are insufficient to estop a party from asserting the statute of limitations]; Marvel v. Capital Dist. Transp. Auth., 114 A.D.2d 612, 612-13 [3d Dep't 1985]; Procco v. Kennedy, 88 A.D.2d 761 [4th Dep't 1982], aff'd, 58 N.Y.2d 804 ; see also Mikinberg v. Baltic S.S. Co., 988 F.2d 327, 331 [2d Cir. 1993]. While settlement negotiations may be a factor in equitable estoppel cases, a party's reliance on an opposing party's promise of settlement must be reasonable (see Cerbone v. Int'l Ladies' Garment Workers' Union, 768 F.2d 45, 50 [2d Cir. 1985]).
In this case, petitioners did not establish that respondent misrepresented that the case would be settled. The negotiating attorney testified that negotiations proceeded to a point where petitioners made a monetary settlement demand and, according to her, respondent's attorney stated that he would "look into getting [petitioners] what [they received] for the prior year" (Tr. pp. 131-32, 138). Unlike petitioners' claim for the previous school year that settled in 2003 and for which the student's mother testified that she received signed stipulation of settlement (Tr. pp. 163-64), there is no evidence in the record that a stipulation of settlement resolving petitioners' claim for the 2002-03 school year was forthcoming. Petitioners voluntarily withdrew their claim in March 2003 (Tr. pp. 13-15). Two years later in March 2005, petitioners' negotiating attorney asserted that petitioners would reassert their claim if it was not resolved by respondent within two weeks. Petitioners nevertheless delayed for nearly eleven more months before requesting an impartial hearing (Parent Exs. B, H at pp. 1-2; Tr. p. 144). Furthermore, petitioners did not reassert their claim until the negotiating attorney was advised by respondent's staff to do so in January 2006 (Parent Exs. B, H at pp. 1-2; Tr. pp. 143-44). Under these circumstances, I find that equitable estoppel does not bar respondent from pleading the statute of limitations as a defense because the evidence does not demonstrate that respondent made any misrepresentations of fact for the purpose of improperly lulling petitioners into a false sense of security or dissuading petitioners from asserting their reimbursement claim (see Procco, 88 A.D.2d at 761-62, see also Long, 882 F. Supp. at 1289).
For similar reasons, I also find that petitioners' claim is barred by laches. Generally, a claim is barred by laches if: (1) a party inexcusably fails to assert a right in a timely manner; and (2) the lapse of time causes prejudice to the adverse party (see Ikelionwu v. United States, 150 F.3d 233, 237 [2d Cir. 1998]; Conopco, Inc. v. Campbell Soup Co., 95 F.3d 187, 192 [2d Cir. 1996]; Phillips v. Bd. of Educ., 949 F. Supp. 1108, 1112 [S.D.N.Y. 1997]). Where a most analogous statute of limitations is applied and a claim is made after the limitations period has run, there is a strong presumption that laches bars the claim, and the claimant has the burden of rebutting that strong presumption and establishing that the defense of laches does not apply (see Conopco, 95 F.3d at 191).
In the instant case, petitioners' request for an impartial hearing was made after the one-year most analogous statute of limitations had expired, hence a strong presumption of laches attached (id.). Petitioners had the burden to produce evidence to rebut the strong legal presumption that their claim was barred by laches. The same circumstances regarding petitioners' delay in asserting their rights that preclude petitioners from asserting equitable estoppel also prevent them from successfully rebutting the strong presumption that their claim is barred by laches. The evidence in the record does not establish that petitioners' delay in asserting their rights was excusable because they requested an impartial hearing in 2002, withdrew the impartial hearing request thereafter, and opted not to assert their rights at an impartial hearing while hoping that a negotiated resolution with respondent could be achieved (Parent Exs. B, C; Tr. pp. 15, 108-109, 144). Under the circumstances of this case, I concur with the impartial hearing officer that petitioners failed to sustain their burden of rebutting the strong presumption of laches (IHO Decision, p. 11; see Ikelionwu, 150 F.3d at 237; Conopco, 95 F.3d at 191).
Petitioners' argument that the doctrine of equitable tolling should apply also fails. Petitioners did not establish any reasons for failing to file their claim that are fairly attributable to respondent except that the parties had hoped to settle the case (Tr. pp. 108-109). I find petitioners' equitable tolling argument unpersuasive because they did not establish facts showing that trickery or inducement by respondent caused petitioners to delay asserting their rights, and they present no extraordinary circumstance that prevented them from exercising their rights (see Veltri v. Bldg. Serv. 32B-J Pension Fund, 393 F.3d 318, 322-23 [2d Cir. 2004]; Cerbone, 768 F.2d at 49; Long, 882 F. Supp. at 1288-89).
Lastly, if I had applied the a two-year statute of limitations under the IDEA, as amended, I would not find that respondent's recommendation for settlement and continuing efforts to negotiate a resolution constituted specific misrepresentations that respondent had resolved the problem forming the basis of the complaint (see 20 U.S.C. § 1415[f][D][i]; Application of the New York City Dept. of Educ., Appeal No. 06-110).
For the foregoing reasons, petitioners' claim for reimbursement for the 2002-03 school year is barred by the one-year statute of limitations. I have considered petitioners' remaining contentions and find them to be without merit.
THE APPEAL IS DISMISSED.
1 The record is somewhat unclear; however, it appears that the student attended the public school placement offered by respondent during the 2002-03 school year and that respondent permitted petitioners to privately fund additional services that were provided to the student at the public school (see Tr. pp. 99, 113).
2 On December 3, 2004, Congress amended the IDEA, effective July 1, 2005 (see Individuals with Disabilities Education Improvement Act of 2004, Pub. L. No. 108-446, 118 Stat. 2647 ). The relevant events underlying petitioners' claim for reimbursement took place prior to the effective date of the 2004 amendments. For convenience, citations in this decision are to the newly amended statute, unless otherwise noted.
3 Respondent objects to petitioners' submission of this exhibit on appeal. Generally, documentary evidence not presented at an impartial hearing may be considered in an appeal from an impartial hearing officer's decision only if such additional evidence could not have been offered at the time of the impartial hearing and the evidence is necessary in order to render a decision (see, e.g., Application of a Child with a Disability, Appeal No. 06-081). I decline to consider it because I find nothing indicating that the additional document was unavailable at the time of the impartial hearing and the document is not necessary for my decision.
4 IDEA 2004 provides that
[t]he timeline described in [20 U.S.C. § 1415[f][C]] shall not apply to a parent if the parent was prevented from requesting the hearing due to -
(i) specific misrepresentations by the local educational agency that it had resolved the problem forming the basis of the complaint; or
(ii) the local educational agency's withholding of information from the parent that was required under this subchapter to be provided to the parent.
20 U.S.C. § 1415[f][D].