Gembala v. Audobon Ass'n, Inc.

• Decision Date: 16 December 1983
• Citation: 469 N.Y.S.2d 502,97 A.D.2d 345
• Parties: Barbara Ellen GEMBALA, Individually and as Parent and Natural Guardian of Michelle Gembala, Appellant, v. AUDOBON ASSOCIATION, INC., et al., Defendants, New York State Urban Development Corporation, Respondent.
• Court: New York Supreme Court — Appellate Division

Page 502

469 N.Y.S.2d 502

97 A.D.2d 345

Barbara Ellen GEMBALA, Individually and as Parent and Natural Guardian of Michelle Gembala, Appellant, v. AUDOBON ASSOCIATION, INC., et al., Defendants, New York State Urban Development Corporation, Respondent.

Supreme Court, Appellate Division Fourth Department.

Dec. 16, 1983.

Allen, Lippes & Shonn, Buffalo (Eric Bloom, Buffalo, of counsel), for appellant.

Damon, Morey, Sawyer & Moot, Buffalo (Joseph A. Matteliano, Buffalo, of counsel), for respondent.

Before DOERR, J.P., and BOOMER, GREEN, O'DONNELL and SCHNEPP, JJ.

O'DONNELL, Justice:

Plaintiff brought suit against several defendants including the Urban Development Corp. [UDC] in a negligence action in Erie County Supreme Court. UDC moved to dismiss the action pursuant to CPLR 3211 (subd. [a], pars. [2] & [7] ) upon the grounds that Supreme Court lacked subject matter jurisdiction. Special Term granted the motion, finding that the UDC is the State qua State, a "corporate governmental agency of the State", and therefore, that UDC may be sued only in the Court of Claims.

The State of New York waived immunity from tort liability with the passage of the Court of Claims Act, vesting that court with exclusive jurisdiction in actions brought against the State as well as agents and agencies of the State exercising governmental powers (Court of Claims Act, article 2, § 9; Psaty v. Duryea, 306 N.Y. 413, 118 N.E.2d 584; Belscher v. New York State Teachers' Retirement System, 45 A.D.2d 206, 357 N.Y.S.2d 241).

The issue on appeal is whether the UDC is so closely related and intertwined with the State as to render it an arm of the State. We conclude that it is not.

Although the UDC, as a public benefit corporation, has many ties to the State, it is not identical to the State and enjoys an independent existence (Matter of Smith v. Levitt, 30 N.Y.2d 934, 935, 335 N.Y.S.2d 687, 287 N.E.2d 380, affg. 37 A.D.2d 418, 421, 326 N.Y.S.2d 335; see also, Grace & Co. v. State Univ. Constr. Fund, 44 N.Y.2d 84, 88, 404 N.Y.S.2d 316, 375 N.E.2d 377; Matter of Dormitory Auth. of State of N.Y. (Span Elec.), 18 N.Y.2d 114, 117, 271 N.Y.S.2d 983, 218 N.E.2d 692; Matter of Plumbing, Heating, Piping & Air Conditioning Contrs. Assn. v. New York State Thruway Auth., 5 N.Y.2d 420, 423-424, 185 N.Y.S.2d 534, 158 N.E.2d 238). The UDC is not a State agency, and the UDC bond proceeds are not State money (Matter of Smith v. Levitt, supra). Accordingly, Special Term erred by holding that the UDC is a "corporate governmental agency of the State."

Moreover, we have previously held that the "familiar grant of power to defendant 'to sue and be sued' " impliedly vests jurisdiction of tort actions in courts of general jurisdiction (Town of Amherst v. Niagara Frontier Port Auth., 19 A.D.2d 107, 108, 241 N.Y.S.2d 247). Where the State Legislature has decided to confer on the Court of Claims jurisdiction over public authorities, it has done so specifically by statute; the absence of such a provision in the enabling legislation indicates that jurisdiction lies with courts of general jurisdiction (see Cole v. State of New York, 64 A.D.2d 1023, 1024, 409 N.Y.S.2d 306). The legislation creating the UDC does not confer jurisdiction upon the Court of Claims. To the contrary, one provision specifically notes that Supreme Court shall have jurisdiction over any proceeding involving UDC notes or bonds New York State urban Development Corporation Act [L.1968, ch. 174, § 1], § 27, subd. [4] ).

Defendant argues that the grant of jurisdiction to Supreme Court with respect to bonds and notes implies that ...