DECISION-ORDER This matter is a contract dispute relating to certain change orders in the construction of a car wash/dog wash building in the City of Watertown, N.Y., owned by a corporation solely controlled by Anthony Doldo (hereinafter “Doldo”) called AM Service Tech, LLC. The general contractor for the project was a corporation solely controlled by Joseph Gerstenschlager, the defendant herein (hereinafter “Gerstenschlager”), called Great Northern Construction, LLC. The parties were personal friends at the commencement of the project. The change orders resulted in Doldo paying $21,448.32 over the original cost of $535,582 set forth in the contract between the parties (an increase of 4 percent ). The parties’ contract (which was a standard contract published in 2014 by the American Institute of Architects — AIA Document A121) was signed in July, 2015 and the project was essentially completed and occupied by December, 2015. Gerstenschlager was arraigned on September 4, 2019 on sealed indictment No. 086-16 reported from the July, 2019 term of the Jefferson County Grand Jury. The indictment accuses the defendant of one (1) count of Grand Larceny in the Third Degree, in violation of section 155.35(1) of the Penal Law; one (1) count of Criminal Possession of Stolen Property in the Third Degree, in violation of section 165.50 of the Penal Law; and one (1) count of Falsifying Business Records in the First Degree, in violation of section 175.10 of the Penal Law. These charges relate to the Defendant’s alleged violation of the NYS Lien Law. The Court has received Defendant’s motions to dismiss in the furtherance of justice and for a review of the grand jury minutes and for an order of dismissal as a result of that review. The Defendant also moved for other relief in the omnibus motion. The District Attorney has submitted her written response in opposition. The Court has also received a motion from District Attorney Kristyna Mills, seeking court recusal on the alleged basis that the Court had acquired information about the case outside of the normal course of Court business and that it had engaged in impermissible ex parte communication. The Court has received responding documents from Defense Counsel Annaleigh Porter, Esq., opposing the motion and it has heard personal oral arguments from both counsel on that motion. Motion for Recusal Contrary to the District Attorney’s claims otherwise in her motion seeking court recusal, (regarding information available to this Court at the time of conferencing this matter), this Court began to receive file information in this matter from the District Attorney’s office on August 1, 2019 and again on August 8, 2019 (prior to arraignment) when it received a CPL Section 710.30 Notice and a Supplemental CPL Section 710.30 Notice containing detectives’ notes and a copy of the Defendant’s grand jury testimony. On September 3, 2019 (the day before the Defendant’s arraignment and the first conference with counsel) the Court received six (6) pages of faxed correspondence from defense counsel that, among other things, contained a letter from defense counsel to Chief Assistant District Attorney Patricia Dzuiba, Esq. (dated June 22, 2018) outlining the contractual history between Doldo, the complainant and Gerstenschlager, the defendant. Prior to Defendant’s in-court arraignment on September 4, 2019 the Court held a felony screening conference in this matter in chambers with Assistant District Attorney Zakary Woodruff and Defense Counsel Annaleigh Porter. Copies of the indictment with notices attached, were served on counsel. At this initial conference, Defense Counsel raised potential conflict of interest issues with Kristyna Mills, the District Attorney and specifically discussed the fact that complainant Doldo was a member of the Jefferson County Board of Legislators and sat on the jurisdictional committee that oversaw the operations of the county’s District Attorney Office (with decision-making authority over budgetary, funding and personnel issues). Also, during that initial conference, the Court noted that it was aware that campaign posters in support of then DA candidate Mills (also the Chief Assistant District Attorney at the time) were displayed on the subject property during the 2015 Fall campaign (as the Court observed that property in its daily commute). After inquiry by the Court, Assistant District Attorney Woodruff could not confirm or deny whether Doldo was a member of the Jefferson County Republican Committee or had any other role in the District Attorney’s campaign (financial or otherwise), but acknowledged that several assistant district attorneys had been involved in the matter over a period of about four (4) years and that potential prosecutorial conflict of interest issues had been discussed in that office. It should be noted, here, that it has been a well-known policy of District Attorney Mills, since her election, that all offers and dispositions in felony matters made by any one of the nine (9) assistant district attorneys in her office must have her personal approval. This policy has been directly communicated to this Court by District Attorney Mills, and by every assistant in her office appearing in this court, on numerous occasions. Ms. Mills was the prosecutor filing of the instant motion seeking recusal and arranged to have several assistant district attorneys prepare affidavits to attach to her motion documents and she personally appeared in court to argue the motion. The Defendant pled not guilty to all charges at his arraignment on September 4, 2019. Defense counsel was directed to file its omnibus motion by September 25, 2019 while the prosecution was directed to respond by October 9, 2019. A further conference date was established for October 18, 2019. On September 25, 2019, the Court received the defense counsel’s omnibus motion (containing seventy-four (74) tabulated pages) which included, among other requested relief, a motion for dismissal in the furtherance of justice and dismissal of the indictment after review of grand jury proceedings. Copies of contract documents, email and other correspondence by and between the parties and counsel, affidavits and other material were included in the motion papers. The People’s response to the omnibus motion was received by the Court on October 7, 2019. However, a transcript of the grand jury proceedings was not attached to the responding papers. On October 17, 2019 the Court, pursuant to the Freedom of Information Act, submitted an email request to the office of the Jefferson County Board of Elections for copies of two (2) public documents filed with that office. The email was addressed to Mr. Jude Seymour and Ms. Babette Hall, the respective Jefferson County Republican and Democratic Election Commissioners, and sought the District Attorney Republican nominating petitions for Kristyna Mills submitted in 2015 and the membership listing of the 2014-2015 Jefferson County Republican Committee. That email correspondence did not identify any court file name or number nor did it contain any information about any pending matter in County Court. District Attorney Mills, in her oral argument on the instant motion, admitted that she spoke with Republican Commissioner Seymour and others about this Court’s FOIA request and about this case at a Republican fund-raising dinner later in the evening of the same day (October 17, 2019). It is unknown whether the complainant Doldo took part in any of the discussions the District Attorney had regarding this case at that fund raiser. The Court received copies of the requested documents (by email) the following day (October 18, 2019) which showed that Anthony Doldo (the complainant seeking criminal prosecution in this matter) was a member of the Jefferson County Republican Committee during the DA campaign in the fall of 2015 and personally carried and witnessed Republican nominating petitions for Kristyna Mills. District Attorney Mills acknowledged that the Jefferson County Republican Committee gave her campaign committee $10,000 prior to her election when questioned by the Court during oral arguments on the instant motion. This Court takes judicial notice of the public campaign income and expense statements filed with the NYS Board of Elections by the “Elect Mills District Attorney” campaign committee (Filer ID C04388) for the 2015 campaign. Those filings show that the Jefferson County Republican Committee gave Ms. Mills’ campaign committee $10,000 in October, 2015 and that, coincidentally, it directly paid Ms. Mills over $10,000 (presumably to reimburse her for lawful expenses she spent on the campaign). However that filing shows that Ms. Mills had a personal pecuniary interest in the funds raised and expended by her campaign committee and in the people and organizations who donated to that campaign. This information regarding a direct monetary interest is very relevant in determining the issue of whether she possessed a prosecutorial ethical conflict. The Court was aware of the public records from both the county and state boards of election and of the documentation previously submitted by counsel related to the filed motions and otherwise (that contained extensive information about the case) when it held a conference (on October 18, 2019) with Defense Counsel Annaleigh Porter and Chief Assistant District Patricia Dzuiba. There was a spirited discussion during that conference on the issue of whether or not District Attorney Mills should have recused herself and her office and thereafter asked the Court to appoint a special prosecutor to deal with any matters relating to Anthony Doldo, the complainant in this matter. Chief Assistant DA Dzuiba asked for a one (1) week adjournment and for a further conference with counsel and the Court to allow her office to put together an offer (that might resolve the matter) before the Court ruled and filed a written decision on the motion to dismiss filed by Defense Counsel. No one was personally disparaged at that conference and the Court never indicated what its decision would be on any motions filed. However, on October 21, 2019 District Attorney Mills filed her motion seeking Court recusal before the next scheduled conference date of October 25, 2019 and Defense Counsel responded with an electronic filing and later with a hard copy filing on the day of oral argument on the motion held on October 25, 2019. The Court was given a copy of the Grand Jury minutes by DA Mills after oral argument on that date. District Attorney Mills frivolously argued that the Court engaged in some type of prohibited ex parte communication about the merits of the case when it requested copies of public documents (without the Court identifying any matter pending before it) on file with the Jefferson County Board of Elections, a public agency. This Court did not engage in any ex parte communication about this matter with anyone. There has been no allegation of legal disqualification under section 14 of the Judiciary Law and the Court is the sole arbiter of recusal. See People v. Moreno, 70 N.Y.2d 403, 405, 521 NYS 2d 663 (1987) and People v. Alomar, 93 N.Y.2d 239, 246, 689 NYS 2d 680 (1999), (“Recusal, as a matter of due process, is required where there exists a direct, personal, substantial or pecuniary interest in reaching a particular conclusion” Id). Judiciary Law §14 requires disqualification of a judge by reason of interest (such as prior representation or consanguinity). The Courts have made it clear that because a judge is “uniquely capable of distinguishing the issues and of making an objective determination “based upon appropriate legal criteria” he or she can be aware of facts which cannot properly be relied upon in making the decision. See Moreno Id at p. 405. This is demonstrated by the same Court’s ability to hear suppression issues and then subsequently preside over a non jury trial. See People v. Brown, 24 N.Y.2d 168, 172, 299 N.Y.S.2d 190 (Ct. App., 1969). When comments are based on information obtained “during the course of his responsibilities in presiding over the matter” there is no bias or prejudice warranting recusal. People v. Glynn, 21 N.Y.3d 614, 619, 977 N.Y.S.2d 692 (Ct. App., 2013). This Court learned of the complainant’s name and business relationship with the defendant and the contractual issues between the parties upon review of material provided by the District Attorney and defense counsel’s submissions, conversations in conference and review of the file, which included the defendant’s grand jury testimony, among other information. As a result, the purported prejudicial information (as alleged by the District Attorney) was acquired by the Court through it’s performance of adjudicative responsibilities. The Court, by separate decision, denied the application of District Attorney Mills to have this Court to recuse itself. Motions to Dismiss This project was constructed on two vacant building lots owned by Doldo at the corner of Bradley Street and Burdick Street in the City of Watertown immediately adjacent to a convenience store/gas station also owned and managed by Doldo. The design plans for the project were prepared by Scott Weston, a mechanical engineer/project engineer and owner of a firm called “Plans by Design”. Mr. Weston arranged for the assistance of the services of a professional engineer who stamped the project plans, as required by various governmental agencies. After governmental approvals were given for the project in early 2015 Mr. Weston did not have any further responsibilities with the project until late 2015 after the project was substantially completed. The contract between the parties required Doldo to hire an architect to supervise and oversee the project during construction. In the absence of an architect, the contract called for the owner to perform those services. After receiving a quote for services from an architect, Doldo decided not to hire an architect or any other professional to serve as a “clerk of the works” or project manager even though he had no prior experience with building or supervising a project of this size and nature. Some subcontractors were hired by Gerstanschlager and some by Doldo. Doldo and Gerstanschlager talked with each other on the site almost on a daily basis between August, 2015 and November, 2015. As is common with construction projects of this scope, there were several items of work performed that were not originally contemplated by the parties’ contract and some items of work that were not required or were otherwise eliminated from the original scope of work. Gerstanschlager testified (during the Grand Jury proceedings herein) that he kept Doldo informed of all items of additional work required as well as those that were not needed or otherwise eliminated from the scope of work contemplated by the contract and he further testified that Doldo approved of all of the changes. However, there was no evidence that Doldo ever asked for (or was given) an estimate of the costs (or savings), from his former friend Gerstenschlager, of any of these changes until the project was nearly complete in the middle of November, 2015. Some of the additional work required involved the excavation and removal of an old submerged foundation on one of Doldo’s lots that had not been previously disclosed to Gerstenschlager prior to the parties’ agreement. An additional cost was incurred for a governmental permit not included in the original contract estimate (and for which Doldo, as the property owner, would normally be responsible). Another item of additional work included the purchase and placement of additional driveway base material, among other things. There were a total of fifteen (15) changes with four(4) changes that reduced the costs of the project and eleven (11) that increased the costs of the project. During his testimony to the grand jury, Doldo said he knew there were changes during the project but just assumed all of the changes would save him money under the contract and that none would increase his total cost originally contemplated by that document. A dispute arose between the parties in November, 2015 after Doldo heard from some subcontractors who had not been paid (or paid in full) after the fifth draw or pay application that had been approved and released by Watertown Savings Bank, Doldo’s lender. Gerstanschlager and Doldo exchanged several emails during that period discussing those changes and the costs (or savings) associated with them and the effect the changes had on the allocation of the funds distributed in that fifth draw (and the effects on the net costs to Doldo). The parties continued to disagree through the months of December, 2015 and January, 2016 over the responsibility for the approximate 4 percent net additional costs for this project. Doldo refused to meet with Gerstanschlager in a “round table meeting” with people involved in the project to resolve the issues over responsibility for those change orders. No further funds were approved and distributed by the bank until the end of January, 2016 after it apparently required Doldo to re-hire Scott Weston (Plans by Design) to review the change order requests (and work performed) and to certify to Doldo (and the Bank) those change orders that should be approved and paid. Weston, who has experience as a “clerk of the works” for a number of projects, told the grand jury in this matter that a net increase contract change of 4 percent was a very reasonable amount for a project of this size. There was absolutely no evidence that any money paid by Doldo in this matter was used for anything other than labor and materials for his construction project. There is no evidence that Gerstanschlager was paid anything more than what was contemplated by the contract between the parties or that he illegally diverted any funds entrusted to him under the NYS Lien Law to himself or other third party. On or about January 29, 2016 Doldo paid Watertown Savings Bank the net contract shortfall sum of $21,448.32 and all contractors and subcontractors were paid in full thereafter. However, at some time before that occurred, Doldo personally spoke with newly-elected District Attorney Kristyna Mills and requested a criminal prosecution of his now-former friend, Gerstanschlager. The District Attorney referred Doldo to a contact within the Watertown City Police Department. In January, 2017 the District Attorney’s office subpoenaed Gerstenschlager’s bank records even though there was no grand jury proceeding pending against Gerstanschlager at that time. There was no evidence that the District Attorney ever sought a magistrate’s approval of any subpoena in this matter. Off and on, over a period exceeding three (3) years, police representatives interviewed various subcontractors or other people with whom Gerstanschlager did business. Conclusions of Law As there is no proof that defendant Gerstanschlager committed any larceny or intended to commit a larceny, the charges contained in this indictment should be and are hereby dismissed, as a matter of law. The issue of whether the defendant is responsible for any monies expended by the complainant Doldo under the contract he had with Gerstanschlager is clearly a civil matter and has no business being in the criminal courts of this state. As a result of the dismissal of the indictment herein, it is unnecessary for this Court to determine any other relief requested by and through the Defendant’s omnibus motion. Even if this matter had not been dismissed, as a matter of law, it should have been in the interests and furtherance of justice as authorized under Criminal Procedure Law Section 210.40, provisions of which the Court has considered. Kristyna Mills abused the prosecutorial powers of her position as District Attorney in this matter. She had an ethical obligation to request the appointment of a special prosecutor in this case which involves criminal complainant Doldo who is a political crony of the District Attoreny, and who was personally and actively involved in her political campaign and was a member of a group that made the largest gift ($10,000) to her campaign fund that would later be used to personally and directly pay candidate Mills over $10,000. Doldo not only serves on the County Legislature which generally funds and operates the District Attorney’s office as one of its departments, but also serves on the very jurisdictional committee of the Board with supervisory responsibility for the operations of the District Attorney and her office (including financial and personnel matters) which requires regular and frequent personal and other interaction and communication with Mills. It is clear that District Attorney Mills has, inappropriately, controlled and supervised the prosecution of this matter from the initial conversation she had with the complainant up to and including the preparation and submission of the latest motion in this matter and her oral argument on that motion. The four (4) year investigation and prosecution of this matter was an inappropriate and wasteful expenditure of public resources and time of personnel by staff within the District Attorney’s office and within the involved police agencies. A dismissal in the furtherance of justice would help restore confidence in the criminal justice system of this county to show that a system of justice giving preferential treatment to the privileged and politically connected is not acceptable. The Defendant Gerstanschlager is a respected businessman, who has apparently not even had the necessity of consulting an attorney in over twenty-seven (27) years in the construction business. Any of the legitimate disputes in this construction case are exactly the type of disputes that can and should be considered in the Alternative Dispute Resolution programs operated by the civil courts of this state (including the new “Presumptive ADR” program recently instituted by Chief Judge Janet DeFiore and Chief Administrative Judge Lawrence K. Marks). For all of the reasons set forth herein, this matter is dismissed. This decision constitutes the order of this Court.
