United States v. Mayor and Council of City of Hoboken, NJ

• Decision Date: 10 August 1928
• Citation: 29 F.2d 932
• Court: U.S. District Court — District of New Jersey
• Parties: UNITED STATES v. MAYOR AND COUNCIL OF CITY OF HOBOKEN, N. J., et al.

29 F.2d 932 (1928)

UNITED STATES v. MAYOR AND COUNCIL OF CITY OF HOBOKEN, N. J., et al.

District Court, D. New Jersey.

August 10, 1928.

COPYRIGHT MATERIAL OMITTED

Walter G. Winne, U. S. Atty., of Hackensack, N. J., Chauncey G. Parker, of Newark, N. J. (Richard F. Jones, of Washington, D. C., of counsel), for the United States Shipping Board.

Horace L. Allen, Corp. Atty., of Hoboken, N. J. (John S. Wise, Jr., of New York City, of counsel), for defendants.

CLARK, District Judge.

This is the return of a rule to show cause why a permanent restraining order should not issue. The rule was granted by one of the other judges of this court on ex parte motion. It was accompanied by a temporary restraint granting in full the prayer of the United States that certain property in the city of Hoboken be declared permanently tax-exempt. The facts are not in dispute. The North German Lloyd and the Hamburg-American Line, the two large German steamship companies operating from this country, acquired part of the bed of the North branch of the Hudson river. Such part extended from the high-water mark opposite that part of the shore which was within the municipal limits of the city of Hoboken. We have not been furnished with any connected history of these properties. However, we have supplemented the facts furnished to us with some investigation of our own. The chain of title to land under piers 1, 2, and 3 (North German Lloyd) shows that they were acquired from the riparian commissioners, pursuant to an act of the Legislature passed April 19, 1889 (4 Comp. St. 1910, p. 4393, § 31), conveying to the city of Hoboken the lands under the Hudson river fronting on Hudson Square, a public park in that city. In return for this grant, the city covenanted as follows:

"The said grant and conveyance is made upon the conditions and upon the covenants of the said the mayor and council of the city of Hoboken, its successors and assigns forever, that the said square and the lands under water in front thereof shall be kept and maintained as an open public square forever fronting on the tide water of the Hudson river, and that no buildings or other structures shall be erected on said public square or on the lands under water, hereby granted, or in front of said square, which shall in any way obstruct or interrupt the view or public access to the water from any part of the said square, and if at any time said public square or the lands hereby granted, or in front of said square, shall cease to be used as a public square or park, or any of the above covenants shall be broken, the lands under water granted herein and hereby shall revert to the state of New Jersey, and belong to the state the same as if this grant and conveyance had not been made." (Italics ours.)

In 1901 and in 1909 the city leased an easement of docking, et cetera, over, first 100, and then later 50 feet of these lands to the North German Lloyd Dock Company for 999 years. Each of these leases contained this covenant:

"Neither of the parties to this agreement, nor the successors nor assigns of either, shall fill in said lands under water, or erect or maintain thereon any buildings or other structures which shall in any way obstruct or interrupt the view or public access to the water from any part of said Hudson Square." (Italics ours.)

Piers 4, 5, and 6 (Hamburg-American Line) were also obtained from the state. They were granted by special act of the Legislature in 1869, before the creation of the riparian commission, to the United Delaware & Raritan Canal Company (P. L. 1869, c. 386). The date and circumstances of the transfer from this company to the Hamburg-American Line, or its American subsidiary, Hamburg-American Line Terminal & Navigation Company, do not appear. It may be important for the city to examine this transfer to determine if there is any condition similar to that outlined in respect to piers 1, 2, and 3.

On these riparian lands the piers so familiar to commuting citizens of New Jersey were erected. They were in constant use for passenger and freight transportation between this country and Germany until the declaration of war between the two nations on April 6, 1917. On March 28, 1918, Congress passed an act reading as follows:

"The President is authorized to acquire the title to the docks, piers, warehouses, wharves, and terminal equipment and facilities on the Hudson river now owned by the North German Lloyd Dock Company and the Hamburg-American Line Terminal & Navigation Company, two corporations of the state of New Jersey, if he shall deem it necessary for the national security and defense: Provided, that if such property can not be procured by purchase, then the President is authorized and empowered to take over for the United States the immediate possession and title thereof. If any such property shall be taken over as aforesaid, the United States shall make just compensation therefor to be determined by the President. Upon the taking over of said property by the President, as aforesaid, the title to all such property so taken over shall immediately vest in the United States: Provided further, that section three hundred and fifty-five of the Revised Statutes of the United States shall not apply to any expenditures herein or hereafter authorized in connection with the property acquired." 40 Stat. 459.

Three months later, the President by proclamation determined and declared that —

"The acquisition of title to the foregoing docks, piers, warehouses, wharves, and terminal equipment and facilities, is necessary for the national security and defense, and I do hereby take over for the United States of America the immediate possession and title thereof, including all leaseholds, easements, rights of way, riparian rights and other rights, estates and interests therein or appurtenant thereto."

* * * * * * *

"Just compensation for the property hereby taken over will be hereafter determined and paid." 40 Stat. 1804, 1805.

On December 3, 1918, the President by proclamation further declared:

"Pursuant to the authority vested in me by the said act of Congress, approved March 28, 1918, do hereby determine and declare that the just compensation for the property in and by said proclamation of June 28, 1918, expropriated for the United States of America is the sum of seven million, one hundred and forty-six thousand, five hundred eighty-three dollars ($7,146,583); and I do hereby order and direct that compensation for the same, aggregating said amount of $7,146,583, be made out of the money appropriated by the act approved December 15, 1917. * * *" 40 Stat. 1914, 1915.

The schedules to this proclamation indicated the disposition of the money would be $2,314,877 to the Hamburg-American Line Terminal & Navigation Company, a corporation of the state of New Jersey, and $1 to the North German Lloyd Dock Company, a corporation of the state of New Jersey, in respect of its reversion, and $4,784,205 to the Alien Property Custodian on behalf of the North German Lloyd, a corporation of the German Empire, in respect of a 999-year lease held by it from the dock company.

Some time after the close of the war, piers 1, 2, and 3 were leased by the War Department as follows:

                  ===========================================================
                    Pier. |        Lessee.   |       Term.  |  Consideration
                  --------|------------------|--------------|----------------
                    No. 1 | Panama Railroad  | 5 years from | $15,000 a month
                          |  Co.             |   12/6/19    |
                    No. 2 | Cosmopolitan     |   ___ from   | $15,000 a month
                          |  Steamship Co.   |   1/8/20     |
                    No. 3 | Munson Steamship | 5 years from | $16,725 a month
                          |  Co.             |   8/31/20    |
                  --------|------------------|--------------|----------------
                

Except in the case of the Panama Railroad Company (itself a government corporation), the leases were assigned to the Shipping Board. Each of them contained a clause substantially as follows:

"8. The use of any part of the leased premises by the lessee in handling merchandise in or out of the pier, or otherwise, shall be such as not to interfere in any way with the government's use of said pier, as in this paragraph provided, or with the waters adjacent thereto, or with any part of said pier, or of the adjacent waters, at any time, with or without notice in advance, notwithstanding the existence of this instrument, and the government's business in connection with said use shall at all times have paramount right of way over the business of the lessee. It is further agreed that any War Department vessels engaged in the return of the American dead from Europe and in the maintenance or return of the American forces in Germany shall be permitted whenever necessary to dock at said pier No. 3, and that in each instance of such use the United States shall refund to the lessee a pro rata or share of the cost to lessee of the pier as a whole (including cost or rental, upkeep, and other expenses), based upon the berthing and/or storage space used and the length of time so used in each instance."

The record again appears to neglect piers 4, 5, and 6, and is silent as to their use subsequent to the war. We gather that they were transferred by the War Department to the Shipping Board, and either used by the United States Shipping Board boats or destroyed by fire. We suggest here also to counsel for the city that further investigation might be useful to enable it or the state to take advantage of such rights as they may have.

Before any discussion of the right, the court is impelled to speak of the remedy. Counsel for the government touch on the question of jurisdiction more by way of assumption than by way of argument, and by citing a case where a similar issue had been considered in equity. Clallam County v. United States, 263 U. S. 34, 44 S. Ct. 121, 68 L. Ed. 328. Many similar cases could, of course, be adduced. Lincoln County v. Pacific Spruce...