Port Authority Police Benev. Ass'n, Inc. v. Port Authority of New York and New Jersey

Decision Date27 May 1987
Docket NumberNo. 86-5768,86-5768
Citation819 F.2d 413
CourtU.S. Court of Appeals — Third Circuit
PartiesThe PORT AUTHORITY POLICE BENEVOLENT ASSOCIATION, INC., and Dominick Evangelista, individually and as President of the Port Authority Police Benevolent Association, Inc., Appellants, v. The PORT AUTHORITY OF NEW YORK AND NEW JERSEY, Appellees, Kirk Nelson, Donald F. Delano, Dennis Flavin, Charles Cossentine, Eugene Ceccarella & George Albin (Intervenors).

Alfred G. Osterwell, P.A. (argued), Edgewater, N.J., for appellants.

Hugh H. Welsh (argued), Arthur P. Berg, Anne M. Tannenbaum, Donald F. Burke, One Path Plaza, Jersey City, N.J., for appellees.

Steven Morelli (argued), Leeds & Morelli, Carle Place, N.Y., for intervenors.

Before WEIS, STAPLETON, and HUNTER, Circuit Judges.


JAMES HUNTER, III, Circuit Judge:

This appeal arises from a complaint for injunctive relief brought under 42 U.S.C. Sec. 1983 (1982) ("section 1983") by the Port Authority Police Benevolent Association ("PBA") against the Port Authority of New York and New Jersey ("Port Authority" or "Authority"). In January 1985, the Port Authority informed the PBA of its intention to use an expired promotion list to meet its current staffing and operational needs. After being rebuffed in its attempts to persuade the Port Authority Labor Relations panel to enjoin use of the list, the PBA filed a section 1983 action for injunctive relief in the United States District Court for the District of New Jersey. In its complaint, the PBA contended that its members had been deprived of a valuable property interest without due process of law in violation of the Fourteenth Amendment. See U.S. Const. amend XIV. In December 1985, the district court issued an opinion finding that the PBA had been deprived of a property interest without due process of law. The district court enjoined the Port Authority from further use of the expired list, and directed that the six promotions that had been made from that list be set aside. After this opinion had been filed, but before an order was entered, the individuals whose promotions were to be set aside were granted leave to intervene as defendants. The court granted their motion to dismiss the PBA's complaint on the ground that the Port Authority enjoys Eleventh Amendment immunity and is therefore not amenable to suit as a "person" under section 1983. This appeal followed. We affirm the order of the district court.

The Port Authority was created by an interstate compact entered into by New York and New Jersey in recognition of the fact that "the commerce of the port of New York has greatly developed and increased and the territory in and around the port has become commercially one center or district." N.J.Stat.Ann. 32:1-1 (West 1963); N.Y. Unconsol. Laws Sec. 6401 (McKinney 1979). The compact was created by the two states in 1921, and approved by the Congress of the United States, as required by the Constitution of the United States. See U.S. Const. art. 1 Sec. 10. We must determine whether such an interstate agency is an arm of the state immune from suit under the Eleventh Amendment, see U.S. Const. amend. XI, or a "person" amenable to suit under section 1983. We conclude that, under the Supreme Court's decision in Lake Country Estates v. Tahoe Regional Planning Agency, 440 U.S. 391, 99 S.Ct. 1171, 59 L.Ed.2d 401 (1979), and our own decision in Blake v. Kline, 612 F.2d 718 (3d Cir.1979), the Port Authority is entitled to Eleventh Amendment immunity. Cf. Mineo v. Port Authority, 779 F.2d 939, 949 (3d Cir.1985) (holding that the Port Authority should be treated as a state for Tenth Amendment purposes).

In Lake Country Estates, Inc. v. Tahoe Regional Planning Agency, the Supreme Court of the United States held that the interstate Regional Planning Authority ("RPA") created by California and Nevada was a "person" for purposes of section 1983. The Court held that, in order to enjoy Eleventh Amendment immunity, an entity created by interstate compact must be an arm of the compacting states rather than a body "comparable to a county or municipality." 440 U.S. at 401, 99 S.Ct. at 1177. Further, there must be "good reason to believe that the States structured the new agency to enable it to enjoy the special constitutional protection of the States themselves." Id. Finally, it must be clear that "Congress concurred in [the States'] purpose." Id. To determine whether the RPA met these criteria, the Court focused on six factors: (1) How is the agency characterized by the language of the creating statutes? (2) From what governmental entity does the agency derive its funding? (3) Is the state financially responsible for the liabilities and obligations incurred by the agency? (4) Are the officers or members of the agency appointed by the state, or by county or municipal governments? (5) Is the function performed by the agency traditionally state or municipal? and (6) Are the actions of the agency subject to the state government's veto? We shall consider each of these factors in turn.

The application of the first Lake Country Estates factor is problematic, because the characterization of the Port Authority by the statutes creating it is somewhat inconsistent. The Port Authority is variously called a "joint or common [state] agency," N.J. Stat. Ann. 32:1-1 (West 1963); N.Y. Unconsol. Laws Sec. 6401 (McKinney 1979), "a body corporate and politic," N.J. Stat. Ann. 32:1-4 (West 1963); N.Y. Unconsol.Laws Sec. 6404 (McKinney 1979), a "person," N.J. Stat. Ann. 32:1-35.73(h) (West Supp. 1986), and "the municipal corporate instrumentality of the two states for the purpose of developing the port and effectuating the pledge of the states in the said compact." N.J. Stat.Ann. 32:1-33 (West 1963); N.Y. Unconsol. Laws Sec. 6459 (McKinney 1979). The term, "joint or common agency" suggests that the Port Authority is a state agency entitled to immunity; the terms, "body corporate and politic" and "person" suggest vulnerability to suit under section 1983, see Monell v. New York City Dept. of Social Services, 436 U.S. 658, 689-90 n. 53, 98 S.Ct. 2018, 2035 n. 53, 56 L.Ed.2d 611 (1978); and the term, "municipal corporate instrumentality" suggests nothing definite in either direction, although its context suggests that the Authority was meant to be a state agency.

Since the statutory language is inconclusive, we will look to guidance from the courts of New York and New Jersey to determine how the state judiciary has characterized the Authority. See Blake v. Kline, 612 F.2d at 722 (" '[L]ocal law and decisions defining the status and nature of the agency involved in its relation to the sovereign are factors to be considered[.]' ") (quoting Urbano v. Board of Managers, 415 F.2d 247, 250-51 (3d Cir.1969), cert. denied, 397 U.S. 948, 90 S.Ct. 967, 25 L.Ed.2d 129 (1970)), cert. denied, 447 U.S. 921, 100 S.Ct. 3011, 65 L.Ed.2d 1112 (1980). The state and federal courts of New York and New Jersey have consistently, whenever confronted with the question of whether or not the Authority is an arm of the state government, held that the Authority is a state agency performing functions on behalf of the state. See, e.g., Mineo v. Port Authority, 779 F.2d at 949 ("[f]rom its inception ..., the Port Authority has been an entity of the two compacting states"), cert. denied, --- U.S. ----, 106 S.Ct. 3297, 92 L.Ed.2d 712 (1986); Newark v. Board of Taxation, 54 N.J. 171, 175, 254 A.2d 513, 515 (the Authority was created by the two states as "their joint agency"), cert. denied, 396 U.S. 987, 90 S.Ct. 483, 24 L.Ed.2d 452 (1969); The Port Authority v. Bosco, 193 N.J. Super. 696, 700, 475 A.2d 676, 678 (1984) (per curiam) (" '[q]uotations of this nature could be multiplied indefinitely' ") (quoting Whalen v. Wagner, 4 N.Y.2d 575, 152 N.E.2d 54, 57, 176 N.Y.S.2d 616, 619 (1958)); Trippe v. Port of New York Authority, 14 N.Y.2d 119, 122, 123, 198 N.E.2d 585, 586, 249 N.Y.S.2d 409, 410, 411 (1964) (the Authority is a "governmental agency" and a "direct agency" of the two states). Indeed, when confronted with the specific question of whether the Authority was suable as a municipal corporation or immune from suit as an agency of the state, the United States District Court for the District of New Jersey concluded that "the Port Authority ... is a joint or common agency of the states of New York and New Jersey. It performs governmental functions which project beyond state lines, and it is immune from suit without its consent." Howell v. Port of New York Authority, 34 F.Supp. 797, 801 (D.N.J.1940) (citations omitted). It is notable that this long-standing judicial characterization of the Authority has never been questioned by either state legislature despite the numerous opportunities to overrule these decisions presented by the periodic amendments the legislatures have made to the statutes creating the Port Authority. Thus, we conclude that the combined legislative-judicial characterization of the Authority indicates an intention on the part of New York and New Jersey that the Authority be considered a state agency for purposes of Eleventh Amendment immunity.

The next two Lake Country Estates factors focus on the financial functioning of the Authority. First, where does the Authority get its funding? At the present time, the Authority does not rely on annual appropriations from the state legislatures. However, under the original terms of the Compact Unless and until the revenues from operations conducted by the port authority are adequate to meet all expenditures, the legislatures of the two states shall appropriate, in equal amounts, annually, for the salaries, office and other administrative expenses, such sum or sums as shall be recommended by the port authority and approved by the governors of the two states, but each state obligates itself hereunder only to the extent of one hundred thousand dollars in any one year.


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