Albert Elia Bldg. Co., Inc. v. New York State Urban Development Corp.

• Decision Date: 12 November 1976
• Citation: 388 N.Y.S.2d 462,54 A.D.2d 337
• Parties: ALBERT ELIA BUILDING COMPANY, INC., Appellant, v. NEW YORK STATE URBAN DEVELOPMENT CORPORATION et al., Respondents.
• Court: New York Supreme Court — Appellate Division

Page 462

388 N.Y.S.2d 462

54 A.D.2d 337

ALBERT ELIA BUILDING COMPANY, INC., Appellant, v. NEW YORK STATE URBAN DEVELOPMENT CORPORATION et al., Respondents.

Supreme Court, Appellate Division, Fourth Department.

Nov. 12, 1976.

Duke, Yaeger & Schlopy, Buffalo (Peter G. Ruppar, Buffalo, of counsel), for appellant.

Hodgson, Russ, Andrews, Woods & Goodyear, Buffalo (Stephen Kelly, Buffalo, of counsel), for respondents N.Y.S. Urban Development Corp. and Logue.

George M. Donohue, Niagara Falls, for respondents Abramowitz and City of Niagara Falls.

Moot, Sprague, Marcy, Landy, Fernbach & Smythe, Buffalo (John J. Phelan, Buffalo, of counsel), for respondent Pigott Construction.

Before MOULE, J.P., and CARDAMONE, SIMONS, MAHONEY and WITMER, JJ.

CARDAMONE, Justice Presiding:

Petitioner, Albert Elia Building Company, Inc., (Elia) a domestic corporation engaged in the general construction business, commenced an Article 78 proceeding to challenge the granting of a change order issued to the Pigott Construction Company for the construction of a tunnel project at the Niagara Falls Convention Center as contrary to the competitive bidding statutes, requesting that the City of Niagara Falls and the New York State Urban Development Corporation be restrained from making payments to Pigott by reason of said illegal change order.

In 1971 respondent City of Niagara Falls (City) entered into a lease agreement with respondent New York State Urban Development Corporation (UDC) whereby the UDC was to construct a Convention Center in downtown Niagara Falls on behalf of the City of Niagara Falls. The Convention Center was to consist of approximately two acres of buildings located along the eastern side of Fourth Street. In March, 1971 respondent Pigott, was awarded the $16,864,000 contract for the general construction of the Convention Center.

In the fall of 1972 the City commenced plans for the development of the areas to the west of Fourth Street, between the Convention Center and Niagara Falls. Abraham Geller and Associates (Geller) was awarded the contract to design the new development and submitted a proposal which consisted of a large plaza in the area between Third Street and Fourth Street, modeled somewhat after Rockefeller Center Plaza in New York City. This original design envisioned a covered-overpass across Fourth Street connecting the plaza with the second floor of the Convention Center. City and UDC officials were concerned, however, over the esthetics of the covered-walkway and they engaged in numerous discussions concerning it. These discussions culminated in a decision on May 11, 1973 by the City Council to request the architects and UDC to eliminate the covered-overpass and, as an alternative method of connecting the Convention Center with the Rainbow Plaza, to build a tunnel under Fourth Street. Drawings for the tunnel, completed by May 25, 1973, involved construction of a retaining wall on the west side of Fourth Street and the construction of a tunnel underneath Fourth Street running from the west side easterly to a point six feet from the outer foundation wall of the Convention Center.

When plans for the tunnel project (Tunnel B) were completed by Geller, the tunnel and retaining wall was still part of the Rainbow Plaza Project. By the middle of June, however, a decision was made that the work on the tunnel and retaining wall should be broken-out of the plaza project. It was further decided that Tunnel B would not emerge into an air lock in front of the glass entrance doors located in the western face of the Convention Center but, rather, the tunnel would lead into an escalator shaft which would emerge within the Convention Center itself. Additional plans for the linkup with Tunnel B, the excavation of the escalator shaft, and the excavation within the Convention Center were then drawn up by Architects, Johnson and Burgee.

On July 16, 1973, the City Council met to determine how to proceed with the work on the tunnel. The City Council decided that rather than have a public bidding they would award the work to Pigott through the issuance of change orders. Two field orders were issued to Pigott that same day after the consent of the City Council was obtained. Field Order 53 covered the work required to construct Tunnel B in accordance with the plans submitted by Geller and Field Order 52 covered both excavation for the escalator pit and breakthrough into the Convention Center, in accordance with the plans submitted by Johnson and Burgee. Four days later, Pigott submitted a price proposal for the Tunnel B construction in the amount of $428,100.

Petitioner commenced the instant Article 78 proceeding by order to show cause why the Tunnel B construction should not be awarded to the lowest responsible bidder pursuant to the public bidding statutes. Petitioner challenged only that part of the tunnel construction covered by Field Order 53, i.e., the tunnel itself and the retaining wall under Fourth Street. Subsequently, respondents served an answer seeking that the petition be dismissed. After a hearing on the merits, Special Term dismissed the petition and granted judgment in favor of the respondents. From this determination, petitioner Elia appeals. The contested Tunnel B work was subsequently performed and completed by Pigott and apparently full payment was made to Pigott by the City, as agent for UDC.

Petitioner contends that the Tunnel B construction work is outside the scope of the Convention Center contract and that the City, as agent for the owner, has violated the provisions of section 103 of the General Municipal Law and that the owner (UDC) has violated the provisions of section 144 of the State Finance Law by awarding such construction work other than to the lowest responsible bidder after public advertisement as required by said statutes. Respondents contend that petitioner has failed to show the personal aggrievement required to maintain the instant proceeding. In the alternative, they urge that petitioner cannot maintain an Article 78 proceeding when it has another avenue for review of the change order by way of a taxpayer's suit pursuant to section 51 of the General Municipal Law.

The competitive bidding statutes (General Municipal Law, § 103, State Finance Law, § 144) impose a mandatory duty upon public officials. Article 78 is the proper vehicle to compel officials to perform a mandatory duty imposed by statute (CPLR 7803(1)). The question presented is whether petitioner is a proper party to compel respondents to comply with these mandates. We observe, at the outset, that petitioner's failure to bring a taxpayer's action pursuant to section 51 of the General Municipal Law is not fatal. Since the owner of the Convention Center is a state agency, an action under section 51 which applies only to municipal action, would not lie. As owner of the Convention Center, UDC was responsible for and exercised control over decisions to proceed by change order rather than separate contract. Special Term found that 'a citizen and taxpayer has no right to bring before the court for review the acts of another department of government simply because he is one of many such citizens and taxpayers nor does the court find petitioner to have shown the personal aggrievement required to bring it within the exception to that rule.' The Court of Appeals, however, departed from its holding in St. Clair v. Yonkers Raceway, 13 N.Y.2d 72, 242 N.Y.S.2d 43, 192 N.E.2d 15, relied upon at Special Term, and held that a taxpayer has standing to challenge enactments of the State Legislature as contrary to the mandates of the State Constitution. Thus, standing is held to exist where a failure to accord it would in effect erect an impenetrable barrier to any judicial scrutiny of legislative action (Boryszewski v. Brydges, 37 N.Y.2d 361, 372 N.Y.S.2d 623, 334 N.E.2d 579). Petitioner is seeking traditional mandamus relief in its attempt to have UDC comply with the applicable competitive bidding statutes. As a general rule, where a citizen, in common with all other citizens, is interested in having some act of a general public nature done, devolving as a duty upon a public body or officer refusing to perform it, the performance of such act may be compelled by a proceeding brought by such citizen against a body or officer. This is especially so where the matter involved is one of great public interest, and granting the relief requested woud benefit the general public (24 Carmody-Wait 2d, N.Y.Civ.Prac., § 145.255). The office which the citizen performs is merely one of instituting a proceeding for the general benefit, the only interest necessary is that of the people at large (People ex rel. Stephens v. Halsey, 37 N.Y. 344; 24 Carmody-Wait 2d N.Y.Civ.Prac., § 145.255). Any citizen may maintain a mandamus proceeding to compel a public officer to do his duty (Matter of Cash v. Bates, 301 N.Y. 258, 93 N.E.2d 835; Matter of Andresen v. Rice, 277 N.Y. 271, 14 N.E.2d 65; Matter of McCabe v. Voorhis, 243 N.Y. 401, 153 N.E. 849; Matter of Yerry v. Goodsell, 4 A.D.2d 395, 403, 166 N.Y.S.2d 224, 233, affd., 4 N.Y.2d 999, 177 N.Y.S.2d 514, 152 N.E.2d 535). Further, resort to a proceeding under Article 78 may be had by a party who is the lowest bidder on a project, and who asserts that by illegal official action he has been denied the award of the contract (Matter of Dictaphone Corp. v. O'Leary, 287 N.Y. 491, 41 N.E.2d 68; Matter of Cestone Bros., Inc. v. Solowinski, 276 App.Div. 970, 95 N.Y.S.2d 170; see, also, Matter of Warren Bros. v. Craner, 30 A.D.2d 437, 293 N.Y.S.2d 763; Matter of Allen v. Eberling, 24 A.D.2d 594, 262 N.Y.S.2d 121). Inasmuch as unsuccessful bidders have standing, it would be 'illogical to deny standing to one who claims that the violation of the statute prevented him from entering any bid at all' (Empire Electrical Contractors Ass'n v. Fabber, 71 Misc.2d 167, 170, 335 N.Y.S.2d 540, 543). Moreover, the preparation of...