City of N.Y. v. Yeshivas Ch'San Sofer, Inc. (In re Oakwood Beach Bluebelt—Stage 1), 2015–10724

Citation164 A.D.3d 1453,84 N.Y.S.3d 518
Decision Date26 September 2018
Docket NumberIndex No. 4009/09,2015–10724
Parties In the MATTER OF OAKWOOD BEACH BLUEBELT—STAGE 1. City of New York, appellant, v. Yeshivas Ch'San Sofer, Inc., respondent.
CourtNew York Supreme Court Appellate Division

Zachary W. Carter, Corporation Counsel, New York, N.Y. (Rochelle Cohen, Michael Chestnov, and Adam Dembrow of counsel), for appellant.

Goldstein, Rikon, Rikon & Houghton, P.C., New York, N.Y. (Michael Rikon and Joshua Rikon of counsel), for respondent.

WILLIAM F. MASTRO, J.P., REINALDO R. RIVERA, SYLVIA O. HINDS–RADIX, ANGELA G. IANNACCI, JJ.

DECISION & ORDER

In a condemnation proceeding, the condemnor, City of New York, appeals from an order, judgment, and fourth separate and partial final decree (one paper) of the Supreme Court, Richmond County (Wayne P. Saitta, J.), dated August 28, 2015. The order, judgment, and fourth separate and partial final decree, insofar as appealed from, upon a decision of the same court dated June 10, 2015, made after a nonjury trial, finding that the value of the subject property was $10,100,000, awarded the claimant the principal sum of $10,100,000 as just compensation for the taking of its property.

ORDERED that the order, judgment, and fourth separate and partial final decree is modified, on the law and the facts, by reducing the award from the principal sum of $10,100,000 to the principal sum of $3,165,513; as so modified, the order, judgment, and fourth separate and partial final decree is affirmed insofar as appealed from, without costs or disbursements, and the matter is remitted to the Supreme Court, Richmond County, for the entry of an appropriate amended order, judgment, and fourth separate and partial final decree.

This condemnation proceeding concerns an approximately seven-acre plot of land, consisting of six tax blocks. In the early 1980s, the subject property was donated to the claimant by separate donors or sponsors in separate parcels for the purpose of constructing a yeshiva. In 1985, the subject property was mapped as a wetland by the New York State Department of Environmental Conservation (hereinafter the DEC). When the claimant was notified in August 1985 that the property had been mapped as a wetland, the claimant sought to procure substitute property, but was financially unable to do so due to a combination of rising property costs and the lack of a suitable location for its space specifications. The claimant applied to the Freshwater Wetlands Appeals Board (hereinafter the FWAB) for a hardship exemption from the wetlands designation. The FWAB granted the hardship exemption in January 1991. The FWAB noted in its decision and order granting the exemption that the claimant "received help from an architect to plan for the use of the space," which plans consisted of the construction of a 53,000–square–foot facility. The facility was to have 15,000 square feet for classrooms, an 8,000 square foot synagogue, 20,000 square feet for a playground and park, and 10,000 square feet for outdoor lecture space, plus additional space in an unspecified size for student and faculty housing. In April 1991, on the claimant's request for a rehearing, the FWAB issued a decision and order removing any "implied restriction on limiting the Yeshiva's development to 53,000 square feet." However, development did not proceed, and the claimant did not file the appropriate applications for development, including the additional housing.

This hiatus in development extended for a period of more than 10 years, between the permit appeals in 1993 and implementation of a one year moratorium on the issuance of permits for development in certain freshwater wetland areas by the commissioner of the DEC in 2003. The moratorium was extended until 2005, when the Department of Environmental Protection and the Department of Citywide Administrative Services applied for site selection and acquisition of the subject property for condemnation.

The City of New York commenced this condemnation proceeding by notice of petition and petition dated May 8, 2009. In the petition, the City requested the Supreme Court to determine, without a jury, the amount of just compensation which should be made to the claimants. Title to the subject property vested to the City on June 25, 2009. The court conducted a nonjury trial in October 2014 as to the valuation of the property. At the nonjury trial, the claimant presented revised plans for development which included additional housing. The court found that the value of the subject property was $10,100,000 and awarded the claimants that principal sum. The City appeals.

"The measure of damages in condemnation is the fair market value of the condemned property in its highest and best use on the date of the taking" ( Matter of City of New York [Franklin Record Ctr.], 59 N.Y.2d 57, 61, 463 N.Y.S.2d 168, 449 N.E.2d 1246 ). The fair market value is the price for which the property would sell if there was a willing buyer who was under no compulsion to buy and a willing seller under no compulsion to sell (see Keator v. State of New York, 23 N.Y.2d 337, 339, 296 N.Y.S.2d 767, 244 N.E.2d 248 ). A determination of the highest and best use of property must be based upon evidence of a use which reasonably could or would be made of the property in the near future (see Matter of Town of Oyster Bay [55 Motor Ave. Co., LLC], 156 A.D.3d 704, 67 N.Y.S.3d 221, citing Matter of City of New York [Broadway Cary Corp.], 34 N.Y.2d 535, 536, 354 N.Y.S.2d 100, 309 N.E.2d 870 ). The burden of proof on that issue was on the claimant (see Matter of City of New York [Broadway Cary Corp.], 34 N.Y.2d at 536, 354 N.Y.S.2d 100, 309 N.E.2d 870 ; Matter of Town of Oyster Bay [55 Motor Ave. Co., LLC], 156 A.D.3d at 708–709, 67 N.Y.S.3d 221 ).

As evidence of highest and best use, the claimant presented evidence of its hardship exemption, and evidence of specific plans for the yeshiva, including streets, parking, and lots that would be left vacant. In contrast to the plans considered by the FWAB in 1991, for the construction of a 53,000 square-foot facility, the plans presented to the Supreme Court consisted of four buildings, with a total floor area of 302,000 square feet. Two of the tax blocks, consisting of 103,608 square feet, would be occupied by structures cited in the original plan, to wit, an 8,000 square-foot building containing a synagogue and offices, and a second seven-story building containing 15,000 square feet of classrooms and 94,200 square feet of housing. Two other blocks consisting of 111,127 square feet would be occupied by two additional buildings, each seven stories in height, consisting of 184,800 additional square feet of housing. The two remaining tax blocks consisting of 91,227 square feet would remain undeveloped. At the hearing, the parties submitted into evidence a stipulation which, inter alia, provided that the site preparation and foundation work for the plans would cost an additional $581,152.

The Supreme Court found that the concrete step taken by the claimant of pursuing a hardship exemption demonstrated that the use as a yeshiva was not a hypothetical, and therefore the use of the property as a yeshiva was the highest and best use of the property. Contrary to the City's contention, that planned use was not...

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