Hackensack Water Company v. Village of Nyack

• Decision Date: 16 August 1968
• Docket Number: No. 67 Civ. 2573.,67 Civ. 2573.
• Citation: 289 F. Supp. 671
• Parties: HACKENSACK WATER COMPANY, Plaintiff, v. The VILLAGE OF NYACK, Defendant.
• Court: U.S. District Court — Southern District of New York

289 F. Supp. 671

HACKENSACK WATER COMPANY, Plaintiff, v. The VILLAGE OF NYACK, Defendant.

No. 67 Civ. 2573.

United States District Court S. D. New York.

August 16, 1968.

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LeBoeuf, Lamb, Leiby & MacRae, New York City, for plaintiff; by Taylor R. Briggs, and Ann Dudley Cronkhite, New York City, of counsel.

Costello, Cooney & Fearon, Syracuse, N. Y., for defendant; Gerald R. Kane, Nyack, N. Y., by George R. Fearon and Angela E. Struglia, Syracuse, of counsel.

OPINION

POLLACK, District Judge.

This is a diversity case. Motions by both parties are before the Court for summary judgment under Rule 56 F.R. Civ.P.

Plaintiff Hackensack Water Company, ("Hackensack" hereafter), is a water service company which draws water from the Hackensack River to service the public in the counties of Bergen and Hudson in Northern New Jersey. Hackensack owns riparian lands in New Jersey along and adjoining the River which are located 5 miles downstream (south) of the point where the Nyack Water Works, i.e., the defendant, obtains water from the River for the use of the cluster of communities known respectively as South, Central, West and Upper Nyack and the Village of Nyack itself. Nyack returns virtually none of the diverted water to the River, but releases any excess into the Hudson River or within the Hudson watershed thus depriving Hackensack River downstream owners or users of the quantity taken by the defendant.

Plaintiff asserts that the flow of the River is decreased by defendant's average diversion of more than 1.384 million gallons per day rendering the flow inadequate to meet plaintiff's water supply requirements and that plaintiff has had to purchase water from other suppliers to meet its needs. Consequently, the plaintiff seeks a summary judgment under Section 429-j(5) of the New York Conservation Law, McKinney's Consol. Laws, c. 65, declaring the rights of the plaintiff Hackensack to be compensated by the defendant Nyack for its withdrawal and diversion without return of the water of the River and limiting further proceedings in this case to an assessment of the amount of damages.

The answer to the complaint admits that Nyack is drawing water from the River and that it is supplying customers in its area, but denies that it is interfering with or violating any rights of the plaintiff. The answer also raises as affirmative defenses that (i) the complaint is insufficient in law, (ii) that plaintiff, having failed to comply with notice of claim statutes, is barred from prosecuting the law suit, (iii) that plaintiff has been guilty of inexcusable laches, (iv) that New York State which owns and controls waters of the River in the State has given Nyack permission to use the waters, (v) that the New York Water Power and Control Commission (now Water Resources Commission) and the Appellate Division of the Supreme Court of New York rendered certain decisions which are a bar to the plaintiff's claims.

Defendant contends that if the following are not found in its favor as a matter of law, there are genuine issues to be tried herein concerning: whether in fact there has been any diversion of water; whether the authorization to Nyack to construct a new water filtration plant also held that lower riparian owners were to be compensated by the courts for damages; whether Nyack plans to divert water at double the present rate from the Hackensack River to the Hudson River watershed; whether the flow of the River has been inadequate to meet plaintiff's legitimate requirements; and whether plaintiff did in fact meet the requirements for filing of claims against Nyack in accordance with the relevant sections of the Village Law of New York State. The defendant also challenges plaintiff's factual contention that plaintiff has annually incurred substantial expenditures for the regulation of the flow of the River, improvements of conditions during dry weather and conservation of the waters of the River.

The defendant has counterclaimed for damages asserting that plaintiff and its wholly owned subsidiary, Spring Valley Water Company, have attempted unfairly to interfere with and appropriate Nyack's water customers and have inspired a groundless taxpayer's action against Nyack and done other acts with the intent or result of unfair competition or violation of the federal and state antitrust laws.

The plaintiff's opposing statement denies the substantive facts of the counterclaim.

Affidavits and exhibits submitted by the parties in support of their respective motions and in opposition to the motions of the other party reveal the following background facts:

The Hackensack River rises in the northern part of the town of Clarkstown in Rockland County, New York, flowing southward, west of and parallel to the Hudson River. The River flows past property owned by the defendant village near the New York-New Jersey border, then past the riparian land of the plaintiff through New Jersey and into Newark Bay and the Atlantic Ocean.

Both parties are dependent upon the Hackensack River as a source of water supply. The plaintiff renders water service to the public in Bergen and Hudson counties in New Jersey, furnishing water for domestic, commercial, industrial and fire protection purposes in 59 municipalities having a combined population in excess of 800,000 persons. Plaintiff is the owner in fee of approximately 90% of the riparian lands lying along and adjoining both banks of the Hackensack River in New Jersey, and has for many years developed and improved the River as a source of water. Plaintiff has constructed two reservoirs in the mainstream of the River in New Jersey, one located at Oradell, the other in Rivervale and Old Tappan (Lake Tappan).

The defendant has constructed a water intake system approximately five miles upstream of plaintiff's riparian land. The water thereby diverted serves approximately 12,500 persons and commercial enterprises in the Village of Nyack as well as inhabitants of South Nyack, Central Nyack, and portions of West Nyack, and Upper Nyack. Water diverted and not consumed by the defendant is expelled into the Hudson watershed and so is lost to the plaintiff.

Nyack originally acquired its water supply system in 1896 by condemning the property of a private water company. Water has been taken from the Hackensack River for use in the system since the nineteenth century. Until 1951, the plaintiff was the only other public water supply system using the River. In that year, however, the Spring Valley Water Company, a wholly owned subsidiary of the plaintiff, then supplying water from wells to residents of Rockland County in New York, applied to the New York Water Resources Commission for permission to draw water from the Hackensack River, and to build a dam and reservoir on the River above the defendant's intake (Application No. 2189, decided July 23, 1952; such application was required by §§ 450-451 of the New York Conservation Law). Creation of the dam and reservoir was expected to increase the dependable yield of the River in Rockland County below the dam to 20 million gallons per day (abbreviated hereafter as "MGD"). The papers submitted to the Court do not reveal the yield prior to 1951.

In approving the project, to be known as the DeForest Dam and Reservoir, the Commission cited the water needs of residents of Rockland County and of New Jersey, and placed certain restrictions on the daily yield of the watershed. Ten MGD were forever reserved for the needs of inhabitants of Rockland County (Finding No. 60). Spring Valley must release from the reservoir "at least" two MGD reserved for Nyack, subject to adjustment should Nyack's needs prove greater than anticipated (Finding No. 57 and Condition K); and 7.75 MGD must be released from the reservoir for passage into New Jersey (Finding No. 56).

Residents of the area to be flooded opposed the proposed dam and reservoir. New Jersey appeared before the Commission to insure that a sufficient amount of water would be permitted to flow into the State of New Jersey. The objectors contended that no direct benefit would accrue to residents of Rockland County, but rather to Bergen County in New Jersey. The Commission, however, stated that it had "full power to see that this project is operated solely for the benefit of citizens of Rockland County. The only benefit to the Hackensack Water Company in New Jersey and the people of New Jersey is the incidental benefit of a regulated flow in the river" (Finding No. 37). The Commission stated that it had given due regard to the interests of the State of New Jersey in maintaining a regulated flow, in pursuance of a policy of "`equitable apportionment'" (Finding No. 51).

The determination of the Commission was affirmed on appeal, Rockland County Anti-Reservoir Ass'n v. Duryea, 282 App.Div. 457, 123 N.Y.S.2d 445 (3rd Dept. 1953). The plaintiff herein agreed to the conditions of the Commission and argued in favor of its affirmance in the Appellate Division.

Spring Valley completed and began operation of its reservoir in 1956 but actual use of the reservoir, dam and filtration plant to supply its customers did not occur until 1963. Meanwhile, between 1952 and 1958, Nyack continued to distribute water from the River to its users. Nyack's requirements had grown from 1.102 MGD pumped in 1952 to 1.4 MGD in 1957. At this rate of increase, a new filtration plant of increased capacity would be needed to meet Nyack's present and future needs for water.

In 1958, Nyack applied to the Water Resources Commission for approval of a new filtration plant of increased capacity (Application No. 3431, decided December 9, 1958). The defendant's application was for permission to take up to an average of 3 MGD, and up to 4.8 MGD during peak periods, from the River.

The plaintiff and Spring Valley objected to the 1958 application, contending that the entire flow of the stream except for a small amount...