State v. SEVENTH REGIMENT

• Decision Date: 04 June 2002
• Parties: STATE OF NEW YORK, Appellant, v. SEVENTH REGIMENT FUND, INC., Respondent.
• Court: New York Court of Appeals Court of Appeals

98 N.Y.2d 249

774 N.E.2d 702

746 N.Y.S.2d 637

STATE OF NEW YORK, Appellant, v. SEVENTH REGIMENT FUND, INC., Respondent.

Court of Appeals of the State of New York.

Argued April 23, 2002.

Decided June 4, 2002.

Eliot Spitzer, Attorney General, New York City (Melanie L. Oxhorn, Caitlin Halligan and Michael S. Belohlavek of counsel), for appellant.

McCanliss & Early LLP, New York City (Philip M. Chiappone of counsel), for respondent.

Judges SMITH, LEVINE, CIPARICK, WESLEY, ROSENBLATT and GRAFFEO concur.

OPINION OF THE COURT

Chief Judge KAYE.

In this hotly-contested litigation, the State alleges that defendant, the Seventh Regiment Fund, Inc., is in wrongful possession of valuable historic artifacts belonging to the State. The Fund maintains that the action is time-barred. The State counters that it is immune from the statute of limitations, and in any event that it sued soon enough after its cause of action accrued. We reject the State's immunity argument but hold that its accrual arguments present issues of fact that render summary judgment improper. We therefore reverse the Appellate Division's grant of summary judgment to the Fund.

Facts

The 107th Support Group of the New York Army National Guard, as it is now styled, is the successor to state militia units that have existed since the early nineteenth century. During much of its history it was called the Seventh Regiment. Beginning in the 1870s, the regimental Armory has been located at 643 Park Avenue in New York City, which is also the address of the Fund, a not-for-profit corporation consisting of veteran and active members of the Regiment.¹ The Fund was incorporated in 1909, for the purpose of promoting and conserving the interests of the Regiment.

The Armory houses various artifacts that the Regiment accumulated through the years, including art works; military trophies and medals; letters and commissions; silverware; books and flags. The parties agree that these memorabilia are historically significant, and worth 6 to 10 million dollars. The memorabilia came to the Regiment both by bequest and by inter vivos gift.

In February 1952, the Regiment's board of officers approved a resolution authorizing its president and commanding officer to sell the memorabilia to the Fund for one dollar. The Fund maintains that the officers anticipated the call to active service in Korea and authorized the transfer in order to ensure the safety of the memorabilia. A bill of sale purportedly transferring to the Fund "all personal property" of the Regiment, with certain exceptions, was executed by the Regiment's commanding officer. The memorabilia remained at the Armory.

The Regiment did not forward copies of the resolution or bill of sale to the Comptroller, the Adjutant General of the militia, or any officer of the State outside the circle of people who participated in the transaction. The Fund claims, however, that various events must have notified the State—for example, publication of photographs of some of the memorabilia with attribution to the Fund, and the Fund's references to the memorabilia during an unrelated 1984 litigation with the State concerning use of the Armory.

In 1996, members of a task force on the state's military heritage visited the Armory to inventory its contents, and were denied access to the memorabilia by members of the Fund. After an exchange of correspondence, in November 1996 the State brought the present action against the Fund, its directors and the Regiment's board of officers, seeking a declaration that it is the owner of the memorabilia.

The State's complaint set forth numerous causes of action, winnowed down by motion practice to a claim against the Fund that the Regiment held the memorabilia in trust for the State in 1952 and thus did not transfer good title. On its first summary judgment motion, the Fund argued that former Military Law § 244 empowered the Regiment to own and dispose of goods received by devise or bequest.² The Appellate Division concluded that, whatever rights and powers section 244 may have conferred as to goods obtained by devise or bequest, the Regiment held at least those objects acquired by inter vivos gift in trust for the State (262 AD2d 205).

The Fund then sought summary judgment on the ground that the State's claims are untimely. Supreme Court assumed that the State's cause of action for spoliation of public property accrued in 1952, and, reasoning that the claim was governed by a 10-year statute of limitations that applied at the time of accrual (see Civ Prac Act § 1226), dismissed the complaint. On reargument the State urged a new theory: that the statute of limitations is not a defense when the State sues in its sovereign capacity. Supreme Court rejected this argument on the merits. The Appellate Division affirmed, rejecting both the State's argument that its claim accrued in 1996 and its "sovereign capacity" theory (283 AD2d 321). We granted the State's motion for leave to appeal, and now reverse and deny the Fund's motion for summary judgment.

The State as Sovereign

The State argues first that the statute of limitations is no defense when it sues as sovereign to recover goods held in trust for the People of New York. The Appellate Division rejected this theory because section 1226 of the Civil Practice Act expressly set a limitations period for State actions to recover personal property, and because the limitations prescribed by the Civil Practice Act "for actions other than for the recovery of real property" applied "alike to actions brought in the name of the people of the state, or for their benefit, and to actions by private persons" (see Civ Prac Act § 54; see also CPLR 201).³ The State maintains, however, that these sections subject it to the statute of limitations only when it acts as a proprietor, not when it acts as a sovereign claiming irreplaceable personal property. The State acknowledges that we have never made this distinction, although the Appellate Division has done so once, relying on the common-law rule that "no time runs against the King" (see State of New York v Vernooy, 109 AD2d 682, 683 [1985]).

We decline to add a "sovereign capacity" exception to the statute of limitations when the State sues to recover personal property. The statutory language clearly subjects the State to the statute of limitations, with the limited exception (under the Civil Practice Act and earlier statutes) of actions for the recovery of real property (see Civ Prac Act §§ 54, 1226; CPLR 201, 213 [5]). Where the Legislature has spoken so plainly, we are reluctant to find further, hidden exceptions.

Beginning in the 17th century, English statutes limited the time in which the Crown might bring certain actions, including suits over rights in land (see generally People v Clarke, 9 NY 349, 361 [1853]). New York's first statute of limitations, enacted in 1788, was "nearly a literal transcript" of the English law, and an 1801 revision left the substance of the 1788 statute intact (see id. at 362; see also L 1801, ch 183). Construing the 1801 statute in 1820, Supreme Court concluded that the Legislature had revoked the State's immunity from statutes of limitations only where real property was concerned, so that the State's action against a lottery manager for misappropriation of funds was not time-barred (see People v Gilbert, 18 Johns 227, 228-229). In Vernooy, when the State sued to assert its title to historic relics salvaged from a sunken warship in Lake Champlain, the Appellate Division relied on Gilbert to support its conclusion that no limitations period applied because the sovereign's common-law immunity remained intact (see Vernooy, 109 AD2d at 683).

That reliance was misplaced, because the statute of limitations has applied against the State in actions other than for real property ever since the Revised Statutes took effect in 1830 (see Rev Stat of NY [part III, ch IV, tit II, § 28 (1st ed 1829)]). Thus, the Legislature enacted the precursor to Civil Practice Act § 54 and CPLR 201 in a deliberate departure from the common-law rule that, in general, "no time runs against the King." Gilbert is merely a late specimen of that rule, inapplicable to the extent that legislation has "shorn" the government actor that invokes it of the "protection which surrounds the sovereign" (see Matter of Gewertz v Berry, 258 NY 505, 509 [1932]). Indeed, the revisers' reports for the Revised Statutes of 1830 show that the precursor to Civil Practice Act § 54 and CPLR 201 was enacted in conscious repudiation of Gilbert. As the revisers stated, in Gilbert "it was held that the state was not bound by the statute of limitations. It is supposed that no good reason exists for the discrimination" (Revisers' Reports and Notes, 3 Rev Stat of NY, at 703 [2d ed 1836]).

Thus, aside from the statutory language itself, which is clear enough, the legislative history plainly expresses an intent to repudiate this doctrine.

The State reinforces its "sovereign capacity" argument by reference to several adverse possession cases (see City of New York v Wilson & Co., 278 NY 86, 99-100 [1938]; Hinkley v State of New York, 234 NY 309, 315-316 [1922]; People v Baldwin, 197 App Div 285, 288, affd without op 233 NY 672 [1922]; Burbank v Fay, 65 NY 57, 65-67 [1875]; see also Weber v Board of Harbor Commrs., 18 Wall [85 US] 57, 70 [1873]). In each of these cases, however, the private claimant did not satisfy one or more of the elements of adverse possession, failing either to occupy the land openly, adversely and exclusively, or to do so for the necessary span of years. Nevertheless once, in Burbank, we characterized as most "decisive" the rule on which the State relies—namely, that no transfer of title to land by adverse possession or prescription "can be presumed where a grant would be unlawful" (65 NY at 66).

For the present discussion, we may assume that when public land of the kind at issue in Weber, Burbank and their...