Courtesy Sandwich Shop, Inc. v. Port of New York Authority, TRANS-HUDSON

• Decision Date: 04 April 1963
• Docket Number: TRANS-HUDSON
• Citation: 240 N.Y.S.2d 1,12 N.Y.2d 379,190 N.E.2d 402
• Parties: , 190 N.E.2d 402 ., et al., Respondents, v. PORT OF NEW YORK AUTHORITY et al., Appellants, Arthur J. Sills, Attorney-General of the State of New Jersey, Intervenor-Appellant. Application of the PORT AUTHORITYCORPORATION, Appellant, Relative to Acquiring Title to Real Property in the State of New York and the State of New Jersey for Hudson Tubes Purposes. Courtesy Sandwich Shop, Inc., et al., Respondents, Louis J. Lefkowitz, Attorney-General of the State of New York, Intervenor-Appellant. Court of Appeals of New York
• Court: New York Court of Appeals Court of Appeals

Page 1

240 N.Y.S.2d 1

12 N.Y.2d 379, 190 N.E.2d 402

COURTESY SANDWICH SHOP, INC., et al., Respondents, v. PORT OF NEW YORK AUTHORITY et al., Appellants, Arthur J Sills, Attorney-General of the State of New Jersey, Intervenor-Appellant Application of the PORT AUTHORITY TRANS-HUDSON CORPORATION Appellant, Relative to Acquiring Title to Real Property in the State of New York and the State of New Jersey for Hudson Tubes Purposes Courtesy Sandwich Shop, Inc., et al., Respondents, Louis J. Lefkowitz, Attorney-General of the State of New York, Intervenor-Appellant.

Court of Appeals of New York.

April 4, 1963.

Daniel B. Goldberg, Sidney Goldstein, Rosaleen C. Skehan, Joseph Lesser, Patrick J. Falvey, Isobel E. Muirhead, Lewis H. Sandler and Anthony J. Raiola, New York City, for Port of New York Authority and others, appellants in the above-entitled action.

Arthur J. Sills, Atty. Gen., of the State of New Jersey (Theodore I. Botter, Trenton, N. J., of counsel), intervenor-appellant pro se.

Louis J. Lefkowitz, Atty. Gen., of the State of New York (Samuel A. Hirshowitz and Daniel M. Cohen, New York City, of counsel), in his statutory capacity under section 71 of the Executive Law.

Edward S. Greenbaum, Roger Bryant Hunting, Morris L. Ernst, Leo Rosen, Louis W. Bookheim, Jr., W. Bernard Richland and I. Lee Merin, New York City, for respondents.

David W. Peck, Herman T. Stichman. Theodore N. Tarlau, John C. Jaqua and Michael A. Cooper, New York City, for Hudson & Manhattan Corporation and another, amici curiae.

Boyle, Feller & Reeves, New York City, for West Side Association of Commerce, Inc., amicus curiae.

Robert E. Littlefield, New York City, for Commerce and Industry Association of New York, Inc., amicus curiae.

Charles W. Merritt, Louis M. Loeb and Jack P. Jefferies, New York City, for New York Chamber of Commerce, amicus curiae.

Donald A. Robinson, Newark, N. J., for New Jersey State Chamber of Commerce, and others, as amici curiae (Shanley & Fisher, Newark, N. J., of counsel; Bernard M. Shanley, Donald A. Robinson, John Kandravy, Newark, N. J., on the brief).

BURKE, Judge.

Chapter 209 of the Laws of New York, 1962, McK.Unconsol.Laws, § 6601 et seq., together with concurrent New Jersey legislation (Laws of N. J., 1962, ch. 8, N.J.S.A. 32:1-35.50 et seq.), authorizes the Port of New York Authority, through the appellant subsidiary, to effectuate a single port development project to consist of the present Hudson & Manhattan Railroad system and a new development to be known as the 'World Trade Center', all on a site in lower Manhattan, part of which is now occupied by the existing Hudson & Manhattan Terminal. Appellant is authorized to condemn property to achieve this purpose and, under this power, instituted the condemnation proceeding here challenged by respondents, who have an interest in the subject property. Respondents argue that chapter 209 violates section 7 of article I of the New York Constitution and the United States Constitution (Matter of Hopper v. Britt, 203 N.Y. 144, 149, 96 N.E. 371, 372-373, 37 A.L.R.,N.S., 825; Missouri Pacific Ry. v. Nebraska, 164 U.S. 403, 17 S.Ct. 130, 41 L.Ed. 489) in that it authorizes the taking of private property by eminent domain for other than a public use.

The proposed World Trade Center is defined by statute as that part of the unified project that is 'a facility of commerce * * * for the centralized accommodation of functions, activities and services for or incidental to the transportation of persons, the exchange, buying, selling and transportation of commodities * * * in world trade and commerce * * * governmental services'. It also states that as far as structures are concerned the World Trade Center also includes any such structure not devoted to railroad functions (thus preserving the distinction between the Hudson & Manhattan part of the project and the World Trade Center functions) even though portions of such structures are not functionally related to the project's purpose and are used solely for 'the production of incidental revenue * * * for the expenses of all or part of the port development project' (ch. 209, § 2).

All of the Appellate Division Justices are agreed that the World Trade Center concept represents a public purpose. The majority found, however, the statute was on its face unconstitutional, in that the act granted a power to condemn property to be used for no other purpose than the raising of revenue for the expenses of the project, and for a class of tenants with a remote relationship with world trade. These conclusions were drawn from the inclusion in the definition of the term 'incidental'. The definition refers to 'incidental' revenue and 'functions * * * incidental to * * * the exchange, buying, selling * * * of commodities * * * in world trade and commerce'. The dissent read the definition as not including the power to condemn any independent areas separately accommodating only incidental revenue tenants not related to the World Trade Center concept. Therefore, it found that revenue production was incidental and not the primary purpose of the taking.

The prime issue, then, is whether the language of the act must be interpreted so as to authorize condemnation for the production of revenue without subordination to any primary purpose. If that is so the act goes beyond what the cases authorize (Bush Term. Co. v. City of New York, 282 N.Y. 306, 26 N.E.2d 269; Kaskel v. Impellitteri, 306 N.Y. 73, 115 N.E.2d 659; Cannata v. City of New York, 11 N.Y.2d 210, 227 N.Y.S.2d 903, 182 N.E.2d 395, app. dsmd. 371 U.S. 4, 83 S.Ct. 28, 9 L.Ed.2d 48) and beyond what can be constitutionally permitted. We think that the statute is valid.

The Appellate Division has stated that the concept of the World Trade Center is a public purpose. We understand this to mean that any use of the property sought to be condemned that is functionally related to the centralizing of all port business is unobjectionable even though private persons are to be the immediate lessees. The 'concept' referred to by the Appellate Division can mean only that. It is the gathering together of all business relating to world trade that is supposed to be the great convenience held out to those who use American ports and which is supposed to attract trade with a resultant stimulus to the economic well- being of the Port of New York. This benefit is not too remote or speculative as to render the means chosen to achieve it patently unreasonable; nor is the benefit sought itself an improper concern of government. The history of western civilization demonstrates the cause and effect relationship between a great port and a great city. (See Pirenne, Economic and Social History of Medieval Europe, (Harcourt, Brace & Co., N.Y.).) Fostering harbor facilities has long been recognized by this court as the legitimate concern of government. (Matter of Mayor of City of N. Y., 135 N.Y. 253, 31 N.E. 1043.) Even the centralization of inland trade has supported the exercise of the power of eminent domain for the establishment of public markets wherein private merchants plied their trades. (Matter of Cooper, 28 Hun 515, app.dsmd. 93 N.Y. 507; Peterson v. Mayor of City of N. Y., 17 N.Y. 449; Ketchum v. City of Buffalo, 14 N.Y. 356.) More recently the indirect benefits deriving from slum clearance and from a 'plan to turn a pre-dominantly vacant, poorly developed and organized area into a site for new industrial buildings' have justified condemnation (New York City Housing Auth. v. Muller, 270 N.Y. 333, 1 N.E.2d 153, 105 A.L.R.2d 905; Cannata v. City of New York, 11 N.Y.2d 210, 215, 227 N.Y.S.2d 903, 905, 906, 182 N.E.2d 395, 397, supra). To retreat from the public importance of piers, markets and slum clearance, even esthetic improvements have been held to be a public purpose justifying condemnation (Berman v. Parker, 348 U.S. 26, 75 S.Ct. 98, 99 L.Ed. 27). No further demonstration is required that improvement of the Port of New York by facilitating the flow of commerce and centralizing all activity incident thereto is a public purpose supporting the condemnation of property for any activity functionally related to that purpose. Nor can it be said that the use of property to produce revenue to help finance the operation of those activities that tend to achieve the purpose of the project does not itself perform such a function, provided, of course, that there are in fact such other activities to be supported by incidental revenue production (Bush Term. Co. v. City of New York, 282 N.Y. 306, 26 N.E.2d 269, supra). The crux of the problem here, however, is that the statute has been read by the Appellate Division as allowing unfettered erection of structures that are solely revenue producing. As the dissent below maintains, this misreads the statute. The act was construed so as to raise rather than settle a constitutional question. We have said that where there are two possible interpretations the court will accept that which avoids constitutional doubts. (Kauffman & Sons Saddlery Co. v. Miller, 298 N.Y. 38, 44, 80 N.E.2d 322, 324, 325; Matter of Coates, 9 N.Y.2d 242, 253, 213 N.Y.S.2d 74, 82, 83, 173 N.E.2d 797, 803, 804.) The act may properly be read to authorize only incidental extensions of a site required for a public use. This is best understood not by reference to only portions of the language of the statute but by reading all the language in context as an entire definition.

The entire definition follows: "World trade center' shall mean that portion of the port development project constituting a facility of commerce consisting of one or more buildings, structures, improvements and areas necessary, convenient or desirable in the opinion of the port authority for the centralized accommodation of functions, activities and services for or incidental to the transportation of persons, the exchange, buying, selling and transportation of commodities and other property in world trade...