Plaintiff conducted an investigation into allegations that defendants underpaid their workers in connection with three public works projects. Following an evidentiary hearing, [*2]plaintiff issued a Determination and Order finding that defendants had failed to pay prevailing wages and supplements to their workers on all three projects. Plaintiff later entered a judgment against defendants for the unpaid wages together with statutory interest and penalties. Defendants now move to vacate or resettle the judgment due to claimed errors contained therein, and to vacate the judgment as against Ruth H. Sutton. Plaintiff opposes and cross-moves to correct the judgment.

Initially, defendants claim that the amount of the judgment is inconsistent with the amount determined to be owed by them in the underlying Determination and Order. As such, defendants seek to vacate the judgment. "Pursuant to CPLR 5019 (a), a trial court has the discretion to correct an order or judgment which contains a mistake, defect, or irregularity not affecting a substantial right of a party, or is inconsistent with the decision upon which it is based" (Adams v Fellingham, 52 AD3d 443, 444 [2008]; see Woolfalk v New York City Housing Authority, 36 AD3d 444, 444 [2007]). Here, plaintiff concedes that there are typographical errors in the judgment as well as an error in the proper interest cut-off date for one of the projects. In order to correlate the judgment with the Determination and Order, plaintiff submits a proposed amended judgment that corrects the typographical errors and uses the correct interest cut-off date. In their reply, defendants do not dispute the accuracy of plaintiff's correction of errors and recalculation of interest. In fact, these corrections reduce the total amount of the judgment by approximately $14,000. Since defendants' substantial rights are not affected by correcting the errors to correlate the judgment with the Determination and Order, the proper remedy for correcting these errors is not to vacate the judgment but, rather, to permit plaintiff to file the amended judgment (see Woolfalk v New York City Housing Authority, supra).

As a separate matter, defendants seek to resettle the judgment on the ground that the judgment failed to credit them for $96,060.75 in contract funds that were allegedly withheld by the Warwick Valley Central School District (hereinafter "Warwick") following plaintiff's investigation into the wage violations. Plaintiff responds that it did not credit defendants with these funds because, although it directed Warwick to withhold funds from defendants, it never received the funds from Warwick. Plaintiff also submits the affidavit of Warwick's assistant superintendent, who states that although Warwick initially informed plaintiff that it was withholding these funds, Warwick never actually withheld the funds because it determined that defendants failed to sufficiently complete their work under the contract. Therefore, Warwick did not consider the funds to be owed to defendants or subject to withholding under the statute.

When wage violations are discovered, plaintiff is entitled to direct that a public contracting agency such as Warwick withhold "any payment due or earned the contractor" (Labor Law § 220-b [2]; [a]; [1]). As defendants correctly point out, the contracting agency would not be allowed to use such withheld funds for any purpose other than for the benefit of the workers (see Labor Law � 220-b [2]; [b]). However, if funds are never withheld at all because they are not "due or earned the contractor," it does not follow that plaintiff must seek to recover the funds from the public contracting agency. To the contrary, it is the contractor against whom a judgment may be entered for any unpaid wages, interest and penalties that are not satisfied by withheld funds (see Labor Law � 220-b [2]; [g]). In sum, since no funds were withheld by Warwick, defendants are not entitled to a $96,060.75 credit on the Warwick project.

Defendants also contend that they should be credited for the interest that has accrued on [*3]the $96,060.75 that was supposedly, but not actually, withheld by Warwick, because plaintiff unreasonably delayed in collecting those funds from Warwick. As indicated above, plaintiff was not required to pursue the funds from Warwick. Interest has accrued due to defendants' own failure to pay the wages for which they were found to be responsible. Therefore, defendants are not entitled to be credited for interest that has accrued on unpaid wages from the Warwick project.

Finally, defendants argue that the judgment should be vacated as against Sutton, individually. Defendants assert that Labor Law Article 8 does not provide an explicit avenue for plaintiff to hold Sutton personally liable, and that plaintiff should not otherwise be allowed to pierce the corporate veil. Plaintiff responds that Article 8 should be interpreted to allow it to hold personally liable any of the top five shareholders of an employer who fails to pay prevailing wages.

The Court finds that Article 8 allows plaintiff to pursue a judgment against a top five shareholder. In the event of a wage violation in connection with a public contract, plaintiff may direct the withholding of money due to a contractor or subcontractor (see Labor Law � 220-b [1], [2]; [a]; [1]). If there are insufficient moneys due to the contractor or subcontractor to cover the unpaid wages, interest and penalties, then plaintiff may withhold money due to a top five shareholder (see Labor Law � 220-b [2]; [a]; [2]; [ii], [2]; [a]; [3]). Such person has the right to contest their status as a top five shareholder (see Labor Law � 220-b [2]; [a]; [3]). Following an investigation and hearing, plaintiff may issue an order directing that the withheld funds be used to pay the worker the amount due to him or her, plus interest and penalties (see Labor Law � 220-b [2]; [c];-[f]). Plaintiff may thereafter file a copy of its order with the county clerk in the county where any of the top five shareholders reside or have a place of business (see Labor Law � 220-b [2]; [g]; [ii]), at which time such person may again contest their status as a top five shareholder (see Labor Law � 220-b [2]; [g]; [iii]). The filing of the order has the full force and effect of a judgment (see id.). The foregoing procedure clearly contemplates that funds may be withheld from a top five shareholder for the benefit of an unpaid worker, and a judgment may ultimately be entered against a top five shareholder.

Furthermore, Sutton is not shielded by the corporate veil doctrine. Generally, "piercing the corporate veil requires a showing that: (1) the owners exercised complete domination of the corporation in respect to the transaction attacked; and (2) that such domination was used to commit a fraud or wrong against the plaintiff which resulted in plaintiff's injury" (Morris v New York State Dept. of Taxation and Fin., 82 NY2d 135, 141 [1993]). "Broadly speaking, the courts will . . . pierce the corporate veil whenever necessary to prevent fraud or to achieve equity" (id. at 140 ). In this case, the hearing officer determined that Sutton was at all times the sole shareholder of defendant Pine Valley, the entity responsible for the underpayments, as well as its president from 1980 to 2004. While the hearing officer noted that Sutton ceased participating in the operations of Pine Valley after 1999 due to failing health, the hearing officer also found that Sutton certified the payrolls on two of the projects and signed the subcontract on a third project. Most significantly, the hearing officer found that Pine Valley falsified its payroll, deliberately underpaid its Mexican workers, and willfully violated Article 8 with respect to each of the projects in a demonstration of "serious bad faith." Based upon all of the foregoing, the Court finds that the corporate veil doctrine does not shield Sutton from personal liability.

Accordingly, it is hereby

ORDERED, that defendants' motion to vacate or resettle the judgment is denied, and it is further

ORDERED, that plaintiff's cross-motion to correct the judgment is granted.

This shall constitute the decision and order of the Court. The original decision/order together with the proposed amended judgment are returned to the attorney for plaintiff. All other papers are being delivered to the Supreme Court Clerk for delivery to the County Clerk or directly to the County Clerk for filing. The signing of this decision/order and delivery of this decision/order does not constitute entry or filing under CPLR Rule 2220. Counsel is not relieved from the applicable provisions of that rule respecting filing, entry and notice of entry.

_____________________________________Andrew G. Ceresia

Acting Supreme Court Justice