De Lorenzo v. City of Hackensack

Decision Date12 May 1952
Docket NumberNo. A--47,A--47
Citation9 N.J. 379,88 A.2d 511
PartiesDE LORENZO v. CITY OF HACKENSACK et al. . Re
CourtNew Jersey Supreme Court

William De Lorenzo, Hackensack, argued the cause for the plaintiff-appellant.

Ralph W. Chandless, Hackensack, argued the cause for the defendants-respondents City of Hackensack and Parking Authority of City of Hackensack (Chandless, Weller, Kramer & Frank, Hackensack, attorneys).

Benjamin C. Van Tine, Trenton, argued the cause for the State (Theodore D. Parsons, Atty. Gen., attorney).

Martin J. Loftus, Newark, argued the cause and filed brief Amicus curiae for Isaac Terhune and Louise Terhune.

Ernest Weller, Hackensack, filed brief Amicus curiae for Emil J. Habrich (Reed, Hoyt & Washburn, New York City, attorneys).

William N. Gurtman, Passaic, filed brief Amicus curiae for Parking Authority of City of Passaic (Gurtman & Schomer, Passaic, attorneys).

The opinion of the court was delivered by

JACOBS, J.

This court granted certification under Rule 1:5--3 to review a judgment of the Law Division which sustained the power of the Parking Authority of the City of Hackensack to issue bonds as a body corporate and politic validly created under L.1948, c. 198 (R.S. 40:11A--1 et seq., N.J.S.A.) and declared the legality of certain agreements entered into between the authority and the City of Hackensack.

Following the passage of L.1948, c. 198 the City of Hackensack, by ordinance, created its parking authority. Thereafter studies were made, the construction of several off-street parking projects was planned, and the authority entered into negotiations for the sale of its bonds in the principal amount of $650,000. It was evident that if the authority's bonds could pledge the city's credit as well as its own they would be more readily saleable at lower interest rates. Accordingly, the city and the authority entered into three agreements dated respectively January 24, 1951, April 1, 1951 and June 4, 1951.

In the main these agreements provided that the authority would acquire certain designated parcels of land and construct parking facilities thereon; the city would lease the land and facilities for 30 years and would agree to pay fixed annual rentals; possession and operation of the land and facilities would remain in the authority which would reduce each annual rental payment from the net revenue realized by it during the preceding year from such operation; the authority could mortgage the premises, issue its bonds and assign the rental payments due from the city to a trustee for bondholders, as additional security, and in such event the city's obligation to make its rental payments would remain absolute and unconditional even though the authority did not undertake or complete the construction of the parking facilities or otherwise defaulted.

Although the agreements purported to effectuate leasing arrangements it seems clear that none of the ordinary incidents of leases was present. Looking through their form to their substance, the agreements obligated the city to contribute annually during each of the 30 years the difference between the net revenues of the authority in the previous year and the amount required by the authority for payment of principal and interest on its bonds. That much is expressly conceded in the brief Amicus curiae filed in this court at the request of the attorneys for the city and the authority in the name of the chairman of the authority. No ordinance relating to the agreements was ever adopted by the city and the only appropriation made pursuant thereto was in the city's budget for 1951 in an amount representing the 1951 rental payable under the agreements.

In July, 1951 the plaintiff-appellant William De Lorenzo, a taxpayer residing in Hackensack, filed his complaint in the Law Division seeking a declaration as to the validity of the agreements between the city and the authority. The city filed answer and the authority filed answer, counterclaim and cross-claim seeking a declaration that the agreements were valid and enforceable and that a proposed assignment, as security, by the authority to a trustee for bondholders of the annual rental payments from the city would be valid and enforceable. Thereafter motions for judgment on the pleadings were made by the taxpayer and the authority. In its opinion sustaining the agreements and the authority's right to assign the annual rental payments to a trustee for bondholders, the Law Division indicated its view that L.1948, c. 198 was a constitutional exercise of legislative power (McSorley v. Fitzgerald, 359 Pa. 264, 59 A.2d 142 (Sup.Ct.1948)), that the city had power to enter into its agreements with the authority (R.S. 40:11A--21, N.J.S.A.; R.S. 40:11A--23, N.J.S.A.; R.S. 40:56-- 1. 1 et seq., N.J.S.A.), and that no appropriation beyond the rental payment for the then current year of 1951 or further ordinance was necessary (Debow v. Lakewood Township, 131 N.J.L. 291, 36 A.2d 605 (Sup.Ct.1944); Viracola v. Long Beach, 142 A. 252, 1 N.J.Misc. 200 (Sup.Ct.1923)). The ensuing judgment dismissing the taxpayer's complaint and granting the relief sought by the authority is now before us for review and the cause has been reargued at the court's direction.

The parking problem confronting urban municipalities in New Jersey and elsewhere is a serious one. See Giant Tiger Corporation v. Board of Commissioners of Trenton, 168 A. 310, 11 N.J.Misc. 836, 839 (Sup.Ct.1933); England v. Millburn Township, 122 N.J.L. 462, 465, 5 A.2d 782 (E. & A.1939). It is being dealt with in many communities by public off-street parking facilities operated oftentimes by the municipalities themselves or by so-called parking authorities created pursuant to enabling legislation. Dean Fordham has referred to the State of Pennsylvania as the leading exponent of the authority plan (Fordham, Local Government's Power to Provide and Finance Parking Facilities, 5 Traffic Quarterly 369, 370 (1951)) and a discussion of the enabling statute in that state may be found in Alpern, Unsnarling the traffic Jam by the Use of Parking Authorities, 36 Va.L.Rev. 1029 (1950). In McSorley v. Fitzgerald, supra, the Supreme Court of Pennsylvania in sustaining its Parking Authority Law had little difficulty in accepting the legislative finding that the maintenance of off-street parking facilities, designed to relieve traffic congestion, constitutes a proper public purpose. Indeed, all of the pertinent recent decisions soundly embody similar views. Fordham, supra, at p. 372; 8 A.L.R.2d 373, 376 (1949). See Denihan Enterprises, Inc. v. O'Dwyer, 302 N.Y. 451, 99 N.E.2d 235 (Ct.App.1951); Poole v. City of Kankakee, 406 Ill. 521, 94 N.E.2d 416 (Sup.Ct.1950); State ex rel. Gordon v. Rhodes, 156 Ohio St. 81, 100 N.E.2d 225 (Sup.Ct.1951).

The use of independent authorities to effectuate proper public purpose was well known in early English and American history; in part, in was a device to enable public road construction as self liquidating projects without additional burdens on taxpayers. See Alpern, supra, at p. 1030. In our State their legal validity has been repeatedly recognized. Thus in New Jersey Turnpike Authority v. Parsons, 3 N.J. 235, 69 A.2d 875 (1949), this court sustained the act which created the New Jersey Turnpike Authority empowered to construct turnpike projects and issue its revenue bonds to defray the cost thereof. Cf. City of Camden v. South Jersey Port Commission, 4 N.J. 357, 73 A.2d 55 (1950). And in Romano v. Housing Authority, Newark, 123 N.J.L. 428, 10 A.2d 181 (Sup.Ct.1939) affirmed 124 N.J.L. 452, 12 A.2d 384 (E. & A.1940) the Court of Errors and Appeals sustained the act which authorized municipalities to create housing authorities with power to construct and operate housing projects and issue bonds. See also Ryan v. Housing Authority of Newark, 125 N.J.L. 336, 15 A.2d 647 (Sup.Ct.1940); Kantor v. Perth Amboy, 123 N.J.L. 504, 10 A.2d 184 (Sup.Ct.1939).

In the light of the foregoing it seems clear to us that L.1948, c. 198 insofar as it authorized, in section 4, the creation of a parking authority in Hackensack with power under section 8 to issue its bonds constituted a proper exercise of the legislative function. See Allison v. Corker, 67 N.J.L. 596, 603, 52 A. 362, 60 L.R.A. 564 (E. & A.1902). Indeed, as we understand the briefs of counsel, they do not question the basic right of the Legislature to enable the creation of municipal parking authorities with authority to issue bonds but rather address their attack to particular individual powers granted elsewhere in L.1948, c. 198 which they assert are not accompanied by sufficient legislative standards or are otherwise invalid. Thus, they point to the broad powers enumerated in section 6 (R.S. 40:11A--6, N.J.S.A.) which they contend are without proper legislative guide for their exercise. See Van Riper v. Traffic Telephone Workers Federation, 2 N.J. 335, 353, 66 A.2d 616, 9 A.L.R.2d 854 (1949). But cf. Bd. of Health of Weehawken v. N.Y. Central R. Co., 4 N.J. 293, 300, 72 A.2d 511 (1950); Davis, Administrative Law, p. 52 (1951); 2 McQuillin, Municipal Corporations, (3d ed. 1949) p. 22. However, since we are of the opinion that the only real controversy between the parties in the instant matter will be fully disposed of by our adjudication on the validity of the agreements between the City of Hackensack and the parking authority, we shall refrain from consideration of the legislative standard issue and the other issues touched upon in the briefs of counsel; they ought await determination in appropriate controversies where they may be grounded upon particular facts fully and properly presented to the court. See Rescue Army v. Municipal Court of the City of Los Angeles, 331 U.S. 549, 568, 67 S.Ct. 1409, 91 L.Ed. 1666, 1677 (1947); Denihan Enterprises, Inc., v. O'Dwyer, supra; Como Farms, Inc., v. Foran, 6 N.J.Super. 306, 317, 71 A.2d 201 (App.Div.1950). Cf. ...

To continue reading

Request your trial
37 cases
  • City of Trenton v. Lenzner
    • United States
    • New Jersey Supreme Court
    • November 22, 1954
    ...of public parking facilities designed to relieve traffic congestion constitutes a proper public use. See DeLorenzo v. City of Hackensack, 9 N.J. 379, 88 A.2d 511 (1952); McSorley v. Fitzgerald, 359 Pa. 264, 59 A.2d 142 (1948); Jahr, While the fact that the property is actually being used fo......
  • Town of Bloomfield v. New Jersey Highway Authority, A--114
    • United States
    • New Jersey Supreme Court
    • April 25, 1955
    ...of such independent agencies is nothing recent but was well known in early English and American history. See De Lorenzo v. City of Hackensack, 9 N.J. 379, 385, 88 A.2d 511 (1952); Webb, Statutory Authorities for Special Purposes, 17, 152 (1922). Cf. Coons, The Development of Public Corporat......
  • Grogan v. De Sapio
    • United States
    • New Jersey Supreme Court
    • January 19, 1953
    ...intention of the whole act. Bass v. Allen Home Improvement Co., supra, (8 N.J., at page 224, 84 A.2d 720); De Lorenzo v. City of Hackensack, 9 N.J. 379, 389, 88 A.2d 511 (1952); State v. Mundet Cork Corp., supra (8 N.J., at page 366, 86 A.2d 1). Cf. Gemsco v. Walling, 324 U.S. 244, 265--266......
  • State v. John P. Callaghan Co.
    • United States
    • New Jersey Superior Court
    • November 29, 1961
    ...Law, provides that the authority shall be a completely separate and independent entity and body politic (citing DeLorenzo v. City of Hackensack, 9 N.J. 379, 88 A.2d 511 (1952), and State v. Parking Authority of the City of Trenton, 29 N.J.Super. 335, 102 A.2d 669 (App.Div.1954)), and theref......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT