In re Bd. of Water Supply of City of New York

• Citation: 105 N.E. 213,211 N.Y. 174
• Parties: In re BOARD OF WATER SUPPLY OF CITY OF NEW YORK.
• Decision Date: 21 April 1914
• Court: New York Court of Appeals

211 N.Y. 174

105 N.E. 213

In re BOARD OF WATER SUPPLY OF CITY OF NEW YORK.

Court of Appeals of New York.

April 21, 1914.

Appeal from Supreme Court, Appellate Division, Third Department.

Application by the Board of Water Supply on behalf of the City of New York to acquire real estate under chapter 724 of the Laws of 1905 and the acts amendatory thereof. From an order of the Appellate Division, Third Department (159 App. Div. 279,144 N. Y. Supp. 373) modifying and affirming an order refusing to confirm and award to De Forest Bishop and another by a commission appointed to appraise and determine the damages to such claimants and others by reason of such board acquiring certain real property, the claimants mentioned appeal on questions certified by the Appellate Division (145 N. Y. Supp. 1113). Reversed, and order of the Special Term affirmed.

Appeal by De Forest Bishop and Frank Bishop, claimants, from an order of the Appellate Division of the Supreme Court in the Third Judicial department, dated September 9, 1913, modifying and as modified affirming an order of the Ulster Special Term, which refused to confirm an award made to claimants by a commission appointed in proceedings to appraise and determine what, if any, damages certain claimants should be paid by reason of the board of water supply of the city of New York acquiring certain real property under chapter 724 of the Laws of 1905 and the acts amendatory thereof.

On August 5, 1907, the appellants filed a claim with the board of water supply of the city of New York for damages to an established boarding house and livery business which was conducted by them in the town of Olive, county of Ulster, on the 1st day of June, 1905.

On the application of the corporation counsel of the city of New York for and on behalf of said city, commissioners were duly appointed to appraise the amount of damages, if any, which the appellants and other named claimants had sustained.

After a hearing said commissioners of appraisal reported to the court by which report the damages of the appellants were fixed at $7,250, together with an allowance to counsel including disbursements of $555.50. The court at Special Term refused to confirm said report, and it was wholly vacated and set aside, and new commissioners were appointed to hear said claims and make awards thereon.

An appeal was taken from the order of the Special Term to the Appellate Division, where the order of the Special Term was modified by striking therefrom the part thereof appointing new commissioners, and as so modified it was affirmed.

An appeal is taken to this court pursuant to an order of said Appellate Division (145 N. Y. Supp. 1113) granting leave to bring this appeal, and certifying that the following questions of law have arisen which ought to be reviewed by this court, viz .:

First. In determinating the value of an established business under section 42, c. 724, of the Laws of 1905, as amended by section 9, c. 314, of the Laws of 1906, should interest upon the capital used in the business, whether real or personal property, be charged as an expense against the gross profits?

Second. In determining the value of an established business under said section 42, should the value of the services of the proprietor and the members of his family in the business be charged as an expense?

Third. In determining the value of a farm boarding house business under said section 42, should the market value of the farm products consumed by the boarders be charged as an expense?

Fourth. In the trial of a claim for damages to an established business under said section 42, is the city of New York entitled to prove any circumstances in abatement of such damages which will tend to mitigate or lessen them?

Fifth. Assuming the claimants, Bishop Bros., conducted a summer boarding house and livery business upon a farm not owned by them, but owned by their mother, and whose boarders were nonresidents of the county of Ulster, which farm and the buildings thereon were condemned and acquired by the city of New York under the provisions of chapter 724 of the Laws of 1905, as amended by chapter 314 of the Laws of 1906, that their mother was awarded the value of the farm and buildings and received the award, was the summer boarding house and livery business conducted by the claimants on the property an established business within the meaning of the said acts, and can the claimants prosecute a claim for its decrease in value, if any such decrease there be?Harrison T. Slosson, of New York City, for appellants.

Frank L. Polk, Corp. Counsel, of New York City (William McM. Speer, of New York City, of counsel), for respondent.

CHASE, J. (after stating the facts as above).

The appellants' claim for damages is wholly dependent upon statutory provision. A reference to the statute under which the claim is filed, and of the statutes passed contemporaneously with it, is necessary to ascertain the extent to which the Legislature intended to authorized the recovery of damages in cases where no such right existed at common law.

[1] The state water supply commission was organized pursuant to chapter 723 of the Laws of 1905. That act provides that a municipal corporation shall not have power to acquire, take, or condemn lands for any new or additional sources of water supply until it has first submitted the maps and profiles therefor to said commission, and until said commission shall have approved the same. The act provides in detail for submitting the maps and profiles to said commission, and among other things it provides that they shall be accompanied ‘by a plan or scheme to determine and provide for the payment of the proper compensation for any and all damages to persons or property, whether direct or indirect, which will result from the acquiring of said lands and the execution of said plans.’ It also provides that the commission shall determine whether the plans proposed are justified by public necessity, ‘and whether such plans are just and equitable to the other municipalities and civil divisions of the state affected thereby and to the inhabitants thereof * * * and whether said plans make fair and equitable provisions for the determination and payment of any and all damages to persons and property, both direct and indirect which will result from the execution of said plans.’ Section 3.

By chapter 724 of the laws of 1905, passed simultaneously with the act establishing the state water supply commission, provision was made for the appointment of a board of water supply of the city of New York with authority to provide an additional supply of pure and wholesome water for said city. Such board was thereafter appointed pursuant to said act, and after the necessary preliminary steps an application was made by it in behalf of the city of New York to the state water supply commission for its approval under the statute of its plan and scheme for acquiring land and property necessary for the construction and maintenance of a reservoir and its appurtenances in the Catskill mountains to provide for such additional supply of pure and wholesome water for said city. While that application was pending before said state water supply commission, certain sections of chapter 724 of the Laws of 1905 were amended by chapter 314 of the Laws of 1906. Section 42 of said act was amended so as to read as follows: ‘The owner of any real estate not taken by virtue of this act and chapter seven hundred and twenty-three of the laws of nineteen hundred and five or of any established business on the first day of June, nineteen hundred and five, and situate in the counties of Ulster, Albany or Greene, directly or indirectly decreased in value by reason of the acquiring of land by the city of New York for an additional water supply or by reason of the execution of any plans for such additional water supply by the city of New York under the provisions of this act and chapter seven hundred and twenty-three of the laws of nineteen hundred and five, their heirs, assings or personal representatives shall have a right to damages for such decrease in value. The board of water supply of the city of New York may agree with such person as to the amount of such damages, and if such agreement cannot be made such damages, if any, shall be determined in the manner herein provided for the ascertaining and determining the value of real estate taken under the provisions of this act, and the commissioners shall not be limited in the reception of evidence to the rules regulating the proof of direct damages. * * * A person employed in a manufacturing establishment, or in an established business, or upon any lands and is not an owner or part owner thereof or of an interest therein, in the counties of Ulster, Albany and Greene, which manufacturing establishment, or established business is injured or destroyed, or which lands are taken or acquired under or because of the provisions of this act, who has been so employed continuously for six months prior to the first day of January, nineteen hundred and six, and who continues in such employment up to the time of such injury, destruction, taking or acquisition shall have a claim for damages against the city of New York equal to the salary paid such employee for the six months immediately preceding the first day of January, nineteen hundred and six. Such damages may be determined by agreement with the board of water supply of the city of New York . In case such agreement cannot be made such employee may maintain an action against the city of New York...