The opinion of the court was delivered by: Thomas J. McAVOY, Senior United States District Judge
Plaintiffs David D. Vicks and Gladys M. Vicks bring this action pursuant to 26 U.S.C. § 7422 claiming an entitlement to a $3,602 tax refund from the 2000 tax year. See Compl. ¶¶ 1-6, 12. The issue in dispute is whether Plaintiff David D. Vicks ("Vicks"), formerly employed as a firefighter with the City of Binghamton Fire Department, was paid taxable wages and other employment benefits during 2000, or whether he was receiving non-taxable benefits pursuant to New York General Municipal Law § 207-a. The United States ("Defendant") has moved for summary judgment arguing that Plaintiffs are not entitled to the requested refund because, although Vicks received Section 207-a benefits in years previous to 2000, in 2000 he was paid taxable salary or wages. Plaintiffs have opposed Defendant's motion and have cross-moved for summary judgment. Plaintiffs argue that once the City of Binghamton awarded Vicks Section 207-a benefits, the benefits could not be revoked absent a revocation hearing. Plaintiffs further argue that because no revocation hearing took place before 2003, Vicks's compensation during 2000 was non-taxable and, therefore, they are entitled to the sought-after refund as a matter of law. For the reasons discussed below, both motions are DENIED.
Based on the parties' Local Rule 7.1(a)(3) statements and responses, a number of relevant facts are undisputed. These undisputed facts are set forth without citation to the record. Where a genuine question of material fact exists, the Court sets forth the parties' positions on that fact and a citation to the record.
On September 3, 1995, David Vicks was injured in the line of duty while working as firefighter for the City of Binghamton Fire Department. As a result of his injuries, Vicks was out of work from September 3, 1995 until January 17, 1996. On January 17, 1996, Vicks returned to work for the Binghamton Fire Department in a light duty capacity. On February 6, 1996, the Office of the Comptroller of the City of Binghamton concluded that Vicks was "entitled to the full amount of his regular salary or wages pursuant to Section 207-a of the General Municipal Law of the State of New York from November 24, 1995 until his disability ceased on January 17, 1996." Feb. 6, 1996 ltr, Ex. A to Vicks Aff.
Vicks continued to work in a light duty capacity, although on an intermittent basis, until August 11, 1999. Vicks's medical provider took him out of work at least 17 times between January 1996 and August 11, 1999. Plaintiffs contend that the injury causing him to miss work these 17 times was "the injury sustained in 1995." Plt. L.R. 7.1 Stat. ¶ 26.
Defendant responds that this fact is irrelevant but "[a]dmits that for intermittent periods prior to August 1999, David Vicks received benefits pursuant to New York General Municipal Law Section 207-a arising out of an accident that occurred in 1995." Def. Resp. to Pltf. L.R. 7.1 Stat., ¶ 26. Defendant's response appears to admit that Vicks received Section 207-a benefits during his absences from work between January 1996 and August 11, 1996.
Assuming that Vicks did receive Section 207-a benefits at some point
after he started light duty work in January 1996, it is unclear, and
disputed, whether he re-applied for these benefits.*fn1
There is a document attached to the Complaint, however, that
sheds some light on this issue. This document, entitled "Stipulation
and Settlement of Claim Pursuant to General Municipal Law §207-A," is
an agreement entered into by Vicks, his attorneys, and the City of
Binghamton Corporation Counsel on May 1, 1998. Because the payment, or
non-payment, of Section 207-a benefits after August 1996 is central to
a resolution of the pending motions, and because the May 1, 1998
agreement appears to address the issue of whether, and under what
conditions, Section 207-a benefits were paid to Vicks after August
1996, the Court will examine the agreement although not referenced in
the parties' Local Rule 7.1 Statements.*fn2
The May 1, 1998 agreement provides that "[t]he City of Binghamton agrees to grant Mr. Vicks full benefits pursuant to General Municipal Law Section 207-A from the prior date of termination on March 4, 1997 until the date of his retirement." 5/1/98 Stip. (Compl. Ex. D), ¶ 2.*fn3 The agreement further provides that "there is no modified duty available for Mr. Vicks based upon his unique disability and restrictions," id. ¶ 3, and that the City of Binghamton will not contest Vicks's claim for New York State Workers' Compensation benefits. Id. ¶ 4. In addition, the agreement requires that Vicks apply for "Accidental and Performance of Duty Disability Retirements with the New York State Retirement System within twenty (20) days of the date of [the] agreement . . . [and] if such application is rejected, Mr. Vicks shall file for service retirement within twenty (20) days of any such rejection . . . ." Id. ¶ 6. Paragraph 8 of the agreement provides:
Mr. Vicks agrees to withdraw any further claim for benefits pursuant to General Municipal Law §207-A after his retirement and Mr. Vicks further agrees that if he fails to file for [retirement as set forth in ¶ 6] the City of Binghamton may discontinue his General Municipal Law § 207-A benefits without further recourse by Mr. Vicks whether by grievance, arbitration, Article 78 proceeding and/or litigation by him or anyone on his behalf.
Inasmuch as Plaintiffs have admitted that "[t]hroughout the 2000 calendar year, David Vicks was employed as a City of Binghamton, New York Fire Fighter," Def. L.R. 7.1 Stat. ¶ 1; see Vicks Aff. ¶ 9 ("Even though I did not work, I received my full compensation during 2000 from the City of Binghamton), it appears that Vicks did not retire as required by the May 1, 1998 agreement. Further, Defendant has submitted evidence indicating that on July 15, 2003, after Vicks, his attorney, and the City of Binghamton entered another settlement agreement (i.e. "Global Settlement Agreement," discussed below), Vicks resigned from the Fire Department. Thus, when addressing Plaintiffs' cross-motion (and thereby viewing the evidence in the light most favorable to Defendant), a reasonable inference could be drawn that Section 207-a benefits, while perhaps re-awarded after 1996, terminated sometime thereafter by operation of paragraph 8 of this agreement because Vicks did not pursue retirement.*fn4
On August 11, 1999, Vicks stopped physically attending work for the Binghamton Fire Department and subsequently filed for Workers' Compensation benefits. On March 6, 2000, the New York Workers' Compensation Board awarded Vicks $3,336.20 for the period from September 1, 1999 through February 29, 2000. On January 19, 2001, the New York Workers' Compensation Board awarded Vicks $11,741.35 for the period from February 29, 2000 through January 11, 2001. The Workers' Compensation Board determined in both awards that Vicks's inability to work during the stated periods was causally related to his 1995 injury. However, because the New York courts have held that a Workers' Compensation Board ...