City of New York v. State
| Decision Date | 13 June 1989 |
| Docket Number | Nos. 70168,66669,s. 70168 |
| Citation | 542 N.Y.S.2d 545,148 A.D.2d 289 |
| Parties | The CITY OF NEW YORK, Claimant-Respondent-Appellant, v. The STATE of New York, Defendant-Appellant-Respondent. (Claims) |
| Court | New York Supreme Court — Appellate Division |
Renee Modry, of counsel (Joseph I. Lauer and Robert Pfeffer with her, on the brief; Peter L. Zimroth, Corp. counsel, New York City, attorney), for the City of New York.
Peter J. Dooley, of counsel (William J. Kogan with him, on the brief; Robert Abrams, Atty. Gen., Albany, attorney), for the State.
Before SULLIVAN, J.P., and CARRO, MILONAS, KASSAL and ELLERIN, JJ.
The instant appeal addresses the issue of whether the Court of Claims properly denied a request, jointly made, for an extension of time for the filing of appraisals in two related condemnation proceedings. The parties sought the extension so as to allow them the opportunity to resolve the myriad issues underlying the two claims, which are extraordinary both in size and complexity. The subject property, located on the West Side of Manhattan, was owned by the City of New York and appropriated by the State of New York between 1981 and 1982 for the now defunct Westway Project (Westway), a proposed interstate highway. The center of an intense political and legal controversy, Westway was abandoned in September of 1985, when the City and the State elected to "trade-in" the project for the set-aside federal monies which would then be used to improve highways and various other public transportation facilities.
As part of the trade-in of the funds, the State and the City agreed to cooperate in resolving all the remaining matters, including the design of a West Side replacement highway, utilization of the property appropriated for Westway, the value of the property appropriated, and the respective roles of the City and State in the development and implementation of a new plan. Feasibility studies on the remaining issues were to be reviewed by a task force consisting of members jointly appointed by the Mayor and the Governor, as well as community, business, labor, environmental and transportation groups. The task force was to report to the Mayor and the Governor by the end of 1986, and make recommendations consistent with the general objectives adopted for Westway.
On May 19, 1982, the City had filed Claim No. 66669 against the State for $225 million for the value of the property appropriated. On November 19, 1984, it filed Claim No. 70168 in an amount in excess of $95 million to protect its right to be compensated either by functional replacement, or otherwise, for certain appropriated property not included under Claim No. 66669. Through January of 1986 the Court of Claims had granted four extensions of time with respect to Claim No. 66669 and two with respect to Claim No. 70168, for the purpose of allowing both parties to file appraisal reports. After two joint motions for time extensions were made in early 1986, the court ordered the claims to trial on April 21, 1986. Both parties appealed. This court granted a stay pending appeal.
While the appeals were pending, the parties jointly moved before the Court of Claims, pursuant to section 206.21 of the Uniform Rules for Trial Courts (22 NYCRR § 206.21), for a further extension of six months after the time when they either agreed to a new plan for a replacement highway and utilization of the property appropriated, or reached an impasse in their negotiations. They also sought, pursuant to section 206.13(d) of the rules, the establishment of a special calendar for these claims. The court denied the motion on January 29, 1987, finding that the parties had "failed to show the required good cause, or that any unusual or substantial circumstances exist[ed] for the Court to favorably exercise its discretion and further extend the time to file appraisals." The court did not, however, then set a new date for the filing of appraisals.
On May 26, 1987, this court reversed, granted the parties' motion for a further time extension in which to file the appraisals, and remanded the matter to set a new date for the filing of reports and for trial. (City of New York v. State of New York, 130 A.D.2d 433, 515 N.Y.S.2d 764, Milonas, J. dissenting.) Quoted at length was section 206.21, which, addressing the procedural requirements for the filing of appraisal reports and the granting of extensions of time for such filing, provides:
(2) An application for any further extension shall be made by motion on notice showing good cause and shall be made to the assigned judge prior to the expiration of any previous extension. The court in its discretion may grant the motion upon such terms and conditions as may be just. Alternatively, a further extension may be set forth in a stipulation which shall be signed by the attorneys and submitted to the assigned judge. The court in its discretion may "so order" said extension.
(3) An application for other or further relief from the requirements or consequences of this section also shall be made to the assigned judge by motion on notice showing unusual and substantial circumstances. However, any application for such relief made after the commencement of trial may be granted only upon a showing of extraordinary circumstances. The court in its discretion may grant the motion upon such terms and conditions as may be just. (Id. at 435-436, 515 N.Y.S.2d 764.)
This court also referred to its power, in reviewing the discretionary power of the trial court, "to determine whether considerations of public policy or special circumstances justify an extension, and to substitute its own discretion for that of the trial court even in the absence of abuse." (Id. at 436, 515 N.Y.S.2d 764, citing Brady v. Ottaway Newspapers, 63 N.Y.2d 1031, 1032, 484 N.Y.S.2d 798, 473 N.E.2d 1172.) In concluding that the parties had demonstrated special circumstances which warranted the granting of their motion for a further extension of time as an exercise of discretion pursuant to section 206.21(g)(3), we held:
In our view, the public interest to be served by facilitating settlement of the valuation issue in the broader context of the current Westway negotiations involving, inter alia, the formulation of new plans for utilization of the property appropriated for Westway, outweighs the salutary purpose almost always served by moving a case to trial expeditiously. (See, City of New York v. State of New York, 40 N.Y.2d 659, 679 [, 389 N.Y.S.2d 332, 357 N.E.2d 988] [1976].) "Both of these powerful entities with their mutual need to cooperate on a host of fronts, financial and otherwise, should be expected to act with far more motivation to avoid litigation whenever possible." (130 A.D.2d at 436-437, 515 N.Y.S.2d 764.)
Shortly after the decision, the parties were summoned to a June 29, 1987 pre-trial conference, at which they renewed their prior motion for a further extension of time to file the appraisal reports and the establishment of a special calendar for both claims. The parties also informed the court that the task force had completed its work and had submitted its recommendations to the Mayor and the Governor, who were currently reviewing them. In addition, the City reported that since the last court appearance Congress had amended the federal highway law (Public Law 100-17, Surface Transportation and Uniform Relocation Assistance Act of 1987) so as to affect the State's obligation, in light of the trade-in, to refund some of the federal funds advanced for Westway, a change which, both parties agreed, had a significant impact on the negotiations between them. The City also advised the court that the parties were "not far apart" in a resolution of the issues. Notwithstanding these developments and the findings of this court in its decision published just one month earlier, the court denied renewal on July 9, 1987 and ordered the parties to file appraisal reports by July 31, 1987, and either to proceed to trial on September 21, 1987, or to withdraw the claims. The parties appeal both the January 29 and July 9, 1987 orders.
One month after the Court of Claims' July 9, 1987 determination, the Mayor and the Governor agreed to a roadway concept, and the respective agencies, including the City and State Departments of Transportation, the City Planning Commission, Department of Ports, International Trade and Commerce, and other agencies, became engaged in a cooperative effort to plan for the economic growth of a revitalized West Side, to consider how best to provide for open space and public access to the waterfront and to design a comprehensive land use plan, encompassing both public and private development, for the property and to resolve other major issues such as the inter-governmental relationship between the two parties in exercising their oversight responsibility. As part of that cooperative effort, the City and State began negotiating the City's valuation claim in the context of a settlement of the outstanding issues.
In a memorandum released in May 1988, the Mayor and the Governor agreed that the City would discontinue both claims with prejudice and without any additional payment by the State, but subject to the terms described therein, including a "50-50" partnership relationship between the City and the State as to the liabilities and assets of the property, the establishment of a "West Side Waterfront Panel" for overseeing future planning, and the approval of the City Comptroller. According to press releases, the Comptroller estimated the fair value of the property, originally intended as a site for housing and commercial construction, at approximately $200 million. The State contended that the $90 million it originally paid to the City for the appropriated property was reasonable because the improvements would not be built. (See, Poor Little Westway, New York Times, Feb. 14, 1989.)
On January 16, 1989, however, the Governor informed...
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